My last blog was a bit down, so I thought I’d follow it up with a more positive vibe quickly. This blog will wander less and stay a bit close to a single idea. The human interactions with opportunity, second chances, and failure - but the good kind of failure.
One of the biggest factors in the successes I’ve had in life, and a factor that I expect will part of any future successes, is the wonderful ‘second chance’. We human folk are remarkably limited compared to all there is to know. There are things we learn by watching others, things we learn by listening to others, and things that we learn by trying - and quite often failing, and trying again.
Those failures, the things we need to try again, are part of the human condition. No one hits the optimally perfect mark the first time they do anything. Ever (or for the pedants, ‘really really close to ever’). Yet it seems some people feel others should be criticised for only a partial success when they first try something. Even worse is when those people aren’t hypocritical about it, and feel they have under-performed when they come up short of the mark, and get scared of having another under-performance.
Failure can be a good thing. The scientific method involves trying to make your theory fail. Hypothesis, Null hypothesis, and Test. Too much of present day science, and getting published, is brushing away failure instead of celebrating it. Proving something you thought was true is actually false permits progress, and gets a bad idea out of the way, so it doesn’t stop other people. That’s good.
The willingness to fail, the willingness to get out of your comfort zone and try stuff is where progress happens. Steve Jobs, Elon Musk, they are/were people who are/were perfectly willing to fail, to push the envelope, and have/had succeeded at some of it. Jobs ended up hitting stuff way out of the park on his third or fourth swing at it, and a long string of foul balls (sorry for any international readers who don’t know baseball. Maybe Beckham bending in a goal involved making a lot of misses that didn’t bend enough.)
Musk is busy failing in real time with the silly Boring Company thing, but doing cool things with Tesla (it’ll be awhile till we see self-driving cars , mind) and making a real go of it with Space X. Being willing to fail at some stuff gets other stuff off the ground. Gates and Bezo are guys that risked failure, and hit a homer first time - and only won championships after a lot of effort to develop their swing. There were a whole bunch of guys playing the same game at the same time, that either didn’t try (IBM at operating systems, Xerox at following up piles of good ideas), just faded away/disintegrated all together (Netscape, Yahoo - could still come back, Word Perfect, Lotus, Apple for a long time, etc, etc, etc.)
Microsoft has been failing since about 1995 and holding back progress because of their dominant position. They stopped being willing to fail, and concentrated on protecting their market share - making it inevitable they would be passed by in time. Lately they are getting some of the groove back, but that’s by trying new things they might fail at (the One Drive thing, some actual innovation with Word and Excel) and is happening in a world where they have lost their one time dominance
Thomas Beckett’s “Ever try. Ever fail. No matter. Try again. Fail again. Fail better.” has the nut of it (even if it the quote, in its original context, is not even nearly, almost, a positive encouragement thing. Beckett didn’t do inspirational. He did miserable and hopelessness - if you can figure out what he was doing at all. Anyway, taking the quote out of context helps me make a point, so consider the quote in its present ‘inspiring’ incarnation for this). It is kinda important that the consequences of failure are built into the attempt. If it is the first ever open heart surgery, you want to be as sure as you can that it will work, and maybe try it on a sick pig or something, before trying it on a sick person.
If it’s a business thing, you want to make sure you don’t end up homeless if it goes sideways. If you listen to rich folks doing business, they have a way to get out (and sometimes leave investors, or government on the hook) if their idea goes wrong. They either learned that by failing already, and picking up the pieces, or by learning from the mistakes of others. The orange one in the White House is the Greatest Ever, at surviving Yuge failures (see recent NYTimes things). Banks are pretty good at getting paid in the end, but venture capital budgets on most of their ventures failing. It means trying new things needs significant piles of money to play with, to start (other people’s money if you can arrange it), so failing doesn’t leave you starving. The innovators need the freedom to fail, and try again.
[‘nother aside]
Failure may be what keeps China from taking over the world. China is a ‘face culture’. Losing ‘face’, looking bad, is, culturally, a ‘bad thing’. Without being willing to fail, without trying anyway, it could keep them from innovating their way passed everybody else. They’ve been plundering the International Patent system to catch up in a hurry, and keep up on coming advances, but they’ve almost played out that hand. They are going to need to do more innovating themselves, risk failing themselves, to move ahead.
[end ‘nother aside]
Back to second chances, and my very own life. I almost got kicked out of Queen’s, and had other people (my Dad, the friend of his that hired me, the other employees at the firm that wrote the letters getting me re-accepted to Queen’s) go out of their way to get me a second chance. I barely got over the finish line even with that second chance.
My early career went well, until my performance dipped after about five years. I was almost at a point where I would change careers (either on my own, or being pushed out of the company) when I got a second chance to move to England, and start again.
While there, I was working for an Associate Professor who could get Imperial College to ignore my undergrad marks and get me into grad school. Another second chance and it was based on who I knew. I had done work that impressed the people I knew, but I wouldn’t have had the second chance if I didn’t know that Associate Prof.
My performance began to dip after about five years, again, and this time had physical health factors involved. The company let me return to Calgary, on very favorable terms, and I could continue to feed myself, despite only being able to work part time. My dad lent me, and later gave me, the down payment on a house, - thus keeping my mother from murdering me, and messing up both of our lives (I joke. My mother is a saint.)
Now we know that, hidden underneath those failures was my mental health, and my fondness for a certain black dog, plus neurological problems - but we didn’t know that at the time - or were just discovering that at the time. I was able to do really good work when I wasn’t dogging it (pun intended), so was able to perform well enough to keep employed when I was underperforming. The ‘car thing’ didn’t really change that very much.
What can we learn by smashing all this rambling into a ball, and shoving it through a strainer? Two big things:
One - there is a bunch of stuff out of the control of a person that affects their life, and a person’s future isn’t necessarily in their control. You can fail because of stuff that happens, not because of the quality of your effort, and succeed at a third try despite the (lacking) quality of your previous efforts.
Two - even when failure is about the quality of your effort, if you learn from it, (and it doesn’t carelessly, or illegally mess up other people’s lives too much) it is a success in disguise. People that are willing to fail are rare and therefore precious.
So ‘good observation, who cares’ I hear from members of my tiny readership (that don’t think I’m just wrong about everything, and have already turned off their computers and gone to bed). Those lessons, and their import to the human condition give us clues on how to build a society that works. Really. Those are key concepts of successful capitalism. We have to be careful not to crowd those concepts out of capitalism in the future. They are important in that they foster competition, and capitalism minus competition goes badly for almost everyone, except those that get to be in the new hereditary aristocracy the ‘capitalistic minus competition’ leads to.
The big difference between my life to this point and lots of other people, people who aren’t sitting on a comfortable chair, in their own home, scribbling random rants, is - I was born into a family that had the contacts and standing to get me those second chances after my failures. Yes, I made the best of - maybe more ‘made good enough’ of - those chances, and I might deserve credit for that, but I wouldn’t have got those second chances to start with, if I didn’t have the family I had, or the brain I was born with…(that ‘brain thing’ is a mixed blessing for people that have anything to do with me - sorry dear reader, please give me a second chance!).
That gets us half of the moral condition that makes living in a society where significant taxes are paid by the wealthy fair and just. Some of those resources should be given back to people who didn’t do as good a job picking their parents, or smashed into a failure they didn’t recover from, through no fault of their own, or fault of their own, or just the fault of the cold, uncaring world. People should have the freedom to fail regardless of the economic position of their birth, and still survive long enough, with enough free time, to try again. Second chances.
The other half of that moral condition, more of that ‘fair and just’ stuff, is the wealthy of today made most of their money on an edifice of successes in their society’s past. Bezo’s doesn’t make much without Berners Lee donating the WWW IP into the commons. Note that Berners Lee never works out the WWW IP in the first place without government funded research. High functioning societies are great things to be part of. High functioning societies require high functioning governments - just saying.
As I’ve written elsewhere, and will write a bunch more times I’m sure, everything from language, to governance, to the uses of fire, to the invention of everything our society knows before a person makes their bundle, it all feeds into a person’s success. The ‘choice of parents’ thing is probably the single most important precondition of success, but they all help. There should be some payment made to the society for allowing everyone to coast on that society’s past successes. Taxes are morally justified as that payment into the society that has been foundational to people’s success, for upkeep and protection if nothing else.
Our IP system says inventors deserve a period of monopoly rents as a reward for coming up, and developing a good idea, and passing that idea into the commons (For people that don’t speak econ’ese - People who invent stuff, and tell everyone about it, get a slice of any profits that come from ‘the stuff’ until a period of time has passed) - patents. The idea is that, without that incentive of no competition for a while, the reward to people who chance failure won’t be enough to develop ideas. Note - the patent isn’t to reward people who invent stuff. The public good is encouraging future innovation by demonstrating the society will reward the people who invent stuff. That could be done through a prize system, and that might lead to fewer problems, or social cost, than making the system we have work.
The idea and morality involved is to provide incentive to inventors, and help progress along. Right now, lots of progress is happening around San Francisco and App development. Of the major players, the Microsofts, the Amazons, the Apples, the Googles, they step on each other’s patents all the time, but they all have so many cross connecting patents that none of them could exist in a world where they were all litigated to the end. It’s a patent cold war of mutually assured destruction. How does that provide incentives for innovation? They litigate patents aggressively against small players who don’t have a patent warchest, and entice or force them into selling themselves into the borg, so it’s just the big guys who get to play.
The odd Facebook comes along and becomes big so fast and builds up a patent warchest so fast that they join the club, but that isn’t working out so well for society. Facebook became a phenomenon before it became a business, and they needed to find a revenue stream somewhere, so they sold access to user’s lives, to mixed results for society. I mentioned earlier, that around 1995 Microsoft stopped focusing on better products, and started to defend their position. They had the ‘best’ (broadly defined) spreadsheet and word-processor in 1995. From my viewpoint as a power user in that era, they seemed to get less useful over the next decade.
Had they kept making it better, instead of making changes that would extend and progress their patent holdings (to hobble challengers) they would still have been providing a public good. Instead, anyone who challenged them had to deal with random shifts in the monopoly operating system that inhouse developers had knowledge of well before outside competitors did. That was the moment when functional antitrust laws should have hit them over the head and broken them up, and/or ‘open sourced’ their code, but instead it only wagged a finger at them.
The goal is to innovate remember. Once a fine, innovating company stops innovating, the patents are no longer providing the public good the patent system was designed to encourage., Once that happens, the moral justification of the granted monopoly is toast. Innovation is the public good we’re trying to maximise. Companies buying smaller competitors and shutting them down before they become a threat and killing progress on their patents is a public ‘bad’.
A functional antitrust system, where monopoly or monopsony conditions are litigated out of existence, is a necessary part of the patent system we’ve worked out for our dog eat dog, let competition govern our economy and largely self regulate and yay Adam Smith! Go capitalism! Let our selfish, greedy worst natures create a world that lifts all boats!
The ‘public good’ is the moral justification of the competitive capitalistic world. You can harness greed and selfish motives to make everyone better off materially, and that leads to the moral justification for an economic system that encourages those values. That’s Adam Smith’s bit of genius. It has clearly had a gigantic, positive effect on lives that have been governed under its auspices. Thing is, just because harnessing those traits has worked to raise all boats, doesn’t make selfishness and greed ‘good things’, it just means they can get leveraged by a smart society, to raise all boats. To state my position clearly (for a change), selfishness and greed are not ‘good things’.
A foundational brick in Adam Smith’s edifice to reach that economic ideal is that competition is unfettered - not that capitalism is unfettered - but that competition is unfettered. Competition does not equal capitalism. Capitalism requires fetters for competition to be unfettered. At present our broken patent system and lack of antitrust enforcement fetter that foundational brick (beat that for mixed metaphors!). Even if competition was unfettered, there are moments when pure competition doesn’t lead to maximisation of the public good, and we end up with more of a brick through a window onto your kitchen table than ‘good’. Welcome to regulation.
Governments have a job to do, in the competitive capitalistic economic system, to keep the consent of the governed in place. Consent of the governed it a really cool thing. We want more of that. Especially when I am one of the governed. The government is supposed to regulate areas where monopoly (or monopsony) conditions arise, internalise externalities (for example, make a polluting industry pay for cleanup), and maintain ‘fairness’ in a society that has winners and losers. Unfettered capitalism sort of existed for most of human history, and it involves the powerful using their freedom to fetter everyone they can. Often not as metaphor.
[begin short aside]
Regulations build up when somebody does something ‘bad’, and pisses off some of the society. The government then makes some rules that make it harder to do that ‘bad’ thing. As lawyers and accountants focus on the rules and how to game them, more and more regulations are made, to make the gaming hard. If the government can make the gaming of laws and regulation hard enough, they don’t have to worry about enforcing them that often. Make an example of somebody, and close down that part of the game.
The democratic socialist countries, the ones that top all the ‘you should live here’ lists, still have shame as a tool to encourage bad actors to pull back a little, and not do ‘bad’ things, even if regulating them is hard. The threat of possible regulation and the bad PR of causing ‘bad things’ is a big enough stick to keep companies acting in a manner that minimises the number of pissed off citizens. Those pissed off citizens make governing hard, so governments try to avoid that, and should try to avoid that. It’s needed for that ‘consent of the governed’ thing, and that keeps guillotine sales down. Bad things happen when the pitchfork and guillotine industries are reporting record profits.
Of course, the leading democratic country (in terms of an ability to exert economic and physical coercion, [and sales of the modern guillotine equivalent, coincidently] not in terms of it being on the ‘you should live here’ lists, cus it doesn’t do very well on those) is frightened of the socialist part, of that ‘democratic socialist’ label. It is also burdened with leadership (both political and commercial) periodically free of the burdens of shame. That’s a shame, but not the point I’m dealing with today, except by accident. Free investment advice, go long on the guillotine industry.
[end ‘longer than I expected’ aside]
Anyway, back to second chances and failing. That government job to provide ‘fairness’ is there because it works, not just because we like to be fair. That we like to be fair, and it happens to work, is the kind of wonderful coincidence, that makes you think there is a greater power somewhere, shaking its head at us and wondering how we got so messed up, and working to fix it.
If everyone in a population has a real shot at second chances, more people are going to take risks, and the more progress we make (in the ‘adding to the knowledge base of man-kind’ kind of way. Also the more ‘shiny stuff’ way, but that isn’t as important). My ability to try and mostly fail to start two companies is dependent on my bad judgement as to predicted future events, my inability to encourage those future events to fit predictions, and a belief that I have an opportunity to fail and still eat and stuff.
What if everybody had that chance? What if everybody could tell their boss to shove it, and set up their own shop? The truth is, most people still wouldn’t do it, because they have good sense. It would still lead to more people doing it, and more stuff getting done. It would mean the next big thing is less likely to come out of ‘ivy league’-ish education (even if Gates quit before he graduated, it was still Harvard, and that it was Harvard made it unlikely his dad would let him starve if it all went south) and more likely to come out of Idaho State (not to pick on Idaho State. I have a very successful friend [in several of the meanings of success, if not quite all of them], who is an alumnus - which is why it came to mind).
Incentives to financial success work to motivate lots of effort to do ‘things’. They work well. Totally cool. The incentive doesn’t need to be more than the annual GDP of many small countries to fill that ‘working well’ role. There are studies I’m sure I’ve read and that google might know of, that show the marginal effectiveness of an incentive peter’s out well before you can single handedly wipe out hunger in whole global regions. If you’re worth a hundred million, another ten grand isn’t worth getting out of bed for, but building a global corporation is a motivation on its own - or so people that have a hundred million tell me..
Let’s take some of that excess incentive away from massively rich folks and use it to give ‘not massively rich’ folks second chances. Like the western economies tried to do during the post WWII years! Back when all the western economies were rewarded with constant improvements in standard of living! Back when America was rewarded, and a (melanin challenged) child could expect to be richer than their parents! Back when America was rewarded, and the top marginal tax rate was ninety percent! You know, the good old days!
This is ultimately a moral argument, and you can have your own morals and whatever, but it’s an argument that fits my morals, and has the benefit of working well for more people than the mess we have made of today. Let’s maximise second chances! Let’s make failure something people are comfortable doing! Let’s have ‘I Failed’ T-shirts outsell MAGA stuff. Let failure MAGA! It’s WAY better than having MAGA fail...