Sanity, as much as is ever found in the La-La land of tech, has prevailed. The late and lamentable Virtue-Signal ™ brand snacks dissected here and here have been burned through, and a brief chat with the office manager has discovered that they will not be being reordered. (She did mention that each species is available separately and much cheaper via Amazon, if there’s a particular kind anybody liked. Not going there myself, unless there’s some sort of delayed addiction coded into the Blueberry/Vanilla/Kale skeet that causes cocaine-level withdrawal symptoms – I almost wouldn’t put it past the hippies that make these abominations. But I digress…)
Turns out the seaweed snacks I’d seen previously had not, in fact, been a part of that particular order, but some had migrated, somehow, to the snack-food Serengeti that was the Cardboard Box of Virtue Snacks, from whence they were consumed – before I got to try them. In the name of Science! and all.
Well, well – a fresh snack shipment came in today from CostCo, which included:
The open package to the left is Ocean’s Halo Maui Onion flavored seaweed. First up for testing.
The operative word here is weed, as in a plant that’s in the way of whatever you’re really doing. But Science! must march on!
As a kid, went to the beach a lot (1), as it was 20 minutes away and I was a kid with older siblings dying to use that fresh driver’s license at any occasion. There were even Whittier to Huntington Beach buses one could catch, but we rarely did that. Instead, I and a bunch of kids from the neighborhood would just pile into the back of our old powder blue station wagon – older sis who was driving and her friends usually got the seats. We were sliding loose in a way that would horrify modern safety-niks as we drove down the 605 singing along with the radio as loud as we could. (Somehow, we all reached adulthood anyway.)
I mention this because the smell of the seaweed when I first open the package reminds me of the areas of the beach we would avoid. The areas where seaweed had washed ashore.
Seaweed was gross! Stank, covered with little flies, and would get tangled on your feet. Eat it? I think not!
But for Science! my love:
It’s – OK. The good parts are that it can curb your salt jones at only 20 calories a box. On the downside, it tastes like seaweed.
So far, I’ve eaten the Maui Onion sheets, and have tasted a couple of the Sea Salt offering. Seems an acquired taste. I think I could acquire it (love sushi rolls, and they have this exact stuff in them often as not…)
Further updates as events warrant.
Such that, as an adult, I’m on way too familiar terms with my dermatologist, who regularly gazes, pokes and prods and has cut chunks – once, and alarmingly large chunk – of ME off my body.
I can totally feel your breathless curiosity even from here: well? What high-end frou-frou snacks did your coworkers eat over the last 2 weeks, and which did they shun?
As of Friday morning:
ALL the Blueberry (13th listed ingredient) Vanilla (16th) Kale (15th) LivBars done got et! As did ALL the seaweed snacks (I didn’t even get to try them! Boohoo!). So what are the 7 items above that fell, somehow, even below those ‘hand made’ ‘organic’ ‘GMO-free’ etc. goodies?
Three (3) Grab the Gold pucks. These really are pucks. I’ve even eaten a couple. Apart from being sugar calorie bombs (as granola-based items strongly tend to be), they were pretty good. Verdict: These are worse than seaweed and kale? My coworkers are sadly mistaken.
Two (2) Go Raw Sprouted Watermelon seeds. OK, this one I kind of understand. Have not tried them myself.
One (1) Beans. This, too does not passeth understanding.
One (1) Sweet & Salty Kettle Corn – huh? (yea, it’s sideway – so sue me.)
So, there you are. The LivBars and seaweed did last to near the end, then, somehow, were more appealing to my coworkers than kettle corn and collapsed-star level dense granola pucks.
By now, there is hardly a larval emanation or tentacled youngling in the multiverse that hasn’t heard of United’s horrible treatment of a passenger on an overbooked flight and its subsequent epic and ongoing self-immolation. Case studies and business school texts are being drafted even now to include this story as the cautionary tale, above the caption: Don’t Ever Do This! (Or, at the better business schools: Fire Any Cretin Who Does This. One needs to be specific with alums of such business schools, as normal human behavior has long since been bred out of them.) Even I, who am unnaturally predisposed to ignoring anything that’s got the webs all a-twitter, have heard of it.
Ignoring the best response (rolling over and going back to sleep after pledging to never again take United at least until they have a really good deal to Cancun), there are two general ways one can react to this. One can marvel at the efficacy of the Dead Hand, which, even now, is pounding United into a bloody pulp. Under the somewhat free market system airlines labor under – this is a tricky part for some – nobody has to fly United. You can pick any number of airlines to be the apex of your airport dehumanization process, or even take a train, drive or stay home. You can park your retirement funds someplace else. And millions, now, are dealing with that exact decision, and whacking big bad United where it presumably hurts the most – in the wallet.
Or one can go all Cosmic Metaphor. You are not mad at United. You are mad at America! It’s the system getting you down, man. Rather than doing something simple, direct and effective – not flying the Friendly Skies – let’s instead throw a pouty party, and dust off everything that sociology professor with the cool beard told us about Capitalism back in the 80s while sitting on the front of his desk, and enlighten the masses.
Airlines try to make money in order to a) stay in business and b) provide a profit to their investors. Or as Dr. Coolbeard would say: they’re greedy. Same exact thing. Because, under the magic flying unicorn system, airlines can stay in business and fly me, a nobody with no connections, most anywhere in the world for a under a week’s salary, without worrying about dirty, dirty money. They can finance (1), fly and maintain vast fleets of insanely complex and expensive machinery at locations all around the world, and sell me and anybody with a few hundred bucks a ticket to a regularly scheduled flight, and pay pilots, attendants, mechanics, baggage handlers and, evidently, graduates of the Nicolae Ceausescu School of Crowd Control – by applying good will and right thinking alone!
I think not.
Running an airline is what is sometimes called a ‘sporty game’ by exactly those graduates of elite business schools from whom all human feeling has been surgically removed. What they mean: You have to be a little crazy to own an airline.
Boring yet important business type stuff follows.
Airline revenues are highly cyclical, while fixed costs are very high. What highly cyclical means: when times get a little tough, one of the first things people cut back on is travel. This holds for businesses as well as individuals. If you sell travel, as airlines do, then, as the saying goes, if the economy gets a cold, you get pneumonia: a slight reduction in overall economic activity produces as relatively large dip in airline revenues. On the other hand, when times get better, people just love to go places!
Yet costs – financing and maintaining all those planes, leasing gates and counters and baggage facilities at all those airports and paying all those people – won’t just go away because you’ve decided to put off seeing grandma until next year and your company switches to a teleconference instead of an in-face meeting. Nope – whether they’re booking every seat and adding routes or flying half-empty planes, a huge chunk of airline expenses are just there. (2)
In practice, what this means is that airlines have to make big money in good times in order to ride out bad times – they are highly motivated to get every penny they can out of every flight. Yet they are also in a highly competitive market, both in direct terms – you can almost always pick between several airlines between any half-way popular destinations – and indirect – you can often drive or stay home or teleconference.
The last straw: your customers aren’t stupid. They know they can go online and compare fares from sometimes dozens of airlines and pick the one they like – usually, the cheapest one that does what they want.
So, here you are, trying to run an airline and pay the salaries of thousands of hardworking people and avoid having to lay them off, so you’re trying to figure out both how much to charge for tickets and what policies will tend toward getting the most revenue out of each flight.
Some genius MBA comes up with the idea of overbooking: since some percentage of people are all but guaranteed to not show up or cancel at the last minute, if you sell only exactly how many seats the plane has, you’ll be flying a less than full airplane and leaving money on the table. What if you sell a few more tickets than you actually have seats for, so that you can fill in the empty seats created by those no-shows and late cancels, and fly a full plane, and make a little extra dough?
The cool part: you, the airline, have all the data needed to make this work – you’ve got years of history of no-shows and cancels by flight! You can hire some smart statisticians to crunch the numbers, and they can tell you within an acceptable level of confidence exactly how many extra seats to sell per flight so that a) your chances of a full flight (and resultant maximum revenue) are high (for whatever value of high you like) while your chances of really, really pissing off your customers is acceptably low (for whatever value of low you can live with).
Two catches: the obvious one, the one painfully clear from United’s late unpleasantness, is that, once in a while, you are going to royally infuriate some customers. The less obvious one: once any airline starts overbooking, all of its competitors on the same routes are all but forced to start overbooking as well. Why? Because failure to get that extra couple grand per flight generated by overbooking means your flight is that much more expensive, on net, than your competitors – in the not so long run, that will put you out of business, unless you can find some other way to make it up. Since you’re already charging for extra bags and food and every other thing the evil, evil airlines have come to charge for over the years, the only real option is to raise prices.
Aaaaaand – you’ll go out of business. Even if it’s only, say, $20 a ticket, you know and I know we’re picking the cheaper ticket – every. darn. time. So is almost everybody else. (This is where our more enlightened comrades will tell us that $20 doesn’t matter, it’s a small price to pay for JVSTICE! and so on. Of course, they always say this about somebody else’s $20. Try walking up to them and asking for that $20 that doesn’t matter – see what happens.)
Conclusion: The free market has provided the opportunity for anyone with a few hundred dollars to travel almost anywhere in the world – at +/- 600 miles/hr. That we take this for granted is nearly as amazing as the brute reality itself. The prices are kept very low (3) because many airlines fly the same popular routes, and most people almost reflexively price shop for tickets. Even a few dollars in price difference will make or break the sale much of the time.
Because airlines are in a sporty game in a highly competitive market, they must – as in, they will go out of business within a few short years or less if they don’t – try to squeeze every penny out of every flight. Overbooking helps them do that, so they are all but forced to do it – by us, the ticket-buying public. Usually, this works great – passengers aren’t even aware it’s going on. Sometimes, it doesn’t. Sometimes, an airline will handle it so badly that they are in the news in the worst way for days on end, their market value drops into 10 figures almost overnight, and people start choosing any other airline.
This fiasco is what we business people call ‘negative reinforcement’. If United had to do it over again, they’d be offering 5 free flights and $10K in cash, and a ride around the airport in a sedan chair carried by United executives dressed as Vestal virgins, and OK, a pony! to free up the seats they needed, and be thrilled to do it. Hindsight is funny that way. Chances are pretty good that, in the future, United will have to find some other way to make total asses of themselves, insult and demean their customers and pull millions and millions out of their investor’s pockets – because they will, for a while at least, make sure they don’t do THAT again.
But they screwed up. And are paying a steep price. And that’s not because America is screwed up – it’s actually a rare case in which things are working pretty well.
My job has entailed learning a bit about financing aircraft, enough that I could go on for several pages at least on the financial ends and outs of getting and maintaining the aircraft an airline needs to stay in business. It’s scary stuff, financially speaking. If you’d like the inside scoop, just ask in the comments, and I’ll do a post! I don’t recommend it, really, but if you’re into that sort of thing…
Overtime and especially fuel are two readily controllable expenses, and they certainly are significant. But they’re not enough for a downturn of any length. Airlines regularly declare bankruptcy – just google any of the big carriers who have been around for a while – United, American, Delta – and you’ll see bankruptcies in their histories. Jetblue and Southwest are exceptions, I think, built on very tightly controlled business models.
The college bookstore is not like Barnes & Noble. The economics are different.
Publishers and book sellers often operate under some peculiar economics. Sarah Hoyt got me to thinking some more about this, after first going there after reading comments on John C Wright’s blog. The following is some informed speculation on the economics of Tor and Barnes and Noble, and the book publishing and selling business in general, based on a few minute’s of web research. I have no background in this in particular, but a lot in business in general.
Many people, with great justification and on the side of the angels, would like nothing more than to boycott Tor books into bankruptcy and oblivion. I wrote in a comment on John C Wright’s blog on why that’s unlikely to happen:
Think of it this way: Your purchases of Wright and Wolfe are not going to keep Tor afloat. There’s even a (theoretical) possibility of humiliations galore. In a free market, when the forced liquidation of Tor takes place, and the bankruptcy valuation people are pouring over the books, they’ll determine positive value – meaning, they think real people would pay real money – to the Wright, Wolfe, and Flynn rights, while counting all the money Tor spent on rights to almost all other current SFF authors as unrecoverable sunk costs to be written off. Tehe!
At least, in the real world, something like this is what would happen. In the phoney world of publishing – and here I speak only of the business model, not of any other fantasies that may be clung to by the people in the industry – Tor is owned by MacMillan, which makes a good chunk of its money by selling wildly overpriced textbooks into a completely rigged market. Tor is a pimple on the hindquarters of the beast. The ‘buyers’ are ‘educators’ immune to market forces (market forces = normal people behaving normally). Educators have open contempt for classics or even merely competent literature, and hold math and science to be social constructs of the Patriarchy. No, really. The publisher works hand in hand with the educators to produce ‘good’ books into a gamed market that forces purchases on the ultimate customers.
Further – and here it gets even murkier – MacMillan is owned by a privately-held German company, so I’m not sure how available or reliable overall revenue numbers would even be. I’m guessing that it’s far, far more profitable to sell $175 psychology books that will be outdated and need replacing in three years by the thousands to colleges that then force their students to buy them than to sell one novel at a time at $20 to people who can spent their money as they please. At the very least, it’s easy to see why a textbook publisher would try the same approach to bookstores: we’ll produce ‘good’ books full of right-think, and you make the students/customers buy them.
Just as a poser such as myself can support my writing Jones with my day gig, the owners of companies can support their publishing hobby – publishing books that make them feel good, but don’t make money – with other activities that do pay. A certain sort of billionaire will buy sports teams to be cool; literary imprints can be owned to stoke the egos of a different sort of rich person. That a particular publisher within the holdings doesn’t make money may just not enter into it, especially if it is a tiny part of the whole enterprise.
Further, as mentioned above, if I can sell expensive textbooks to college bookstores by the dozens or hundreds at a pop, and have the purchase decision made by one or few people who then push down the ultimate purchase to a captive audience – students – I’ll do that. For one thing, sales are almost perfectly predictable. Then, once I’ve got that model up and running, I’d try to see if I could expand it to other markets. Thus, big chain bookstores were treated largely like college bookstores, where numbers of books were ordered and shipped based on the assumption that the middlemen could then force them upon a captive audience. This approach could kinda sorta work – until an Amazon comes along. Once that happens, you need to sell single copies of relatively inexpensive books to one person at a time. That’s a different mindset altogether.
Hachette Book Group (HBG) is a division of the second largest trade and educational book publisher in the world, Hachette Livre. Hachette Livre is based in France and is a subsidiary of the French media company, Lagardère.
Financial: 2015 sales: 2.21 billion EUR; #4 in the US. Wholly owned by Lagardere, with had 2015 sales of 7.19 billion EUR. So: its entire publishing arm accounts for less than a third of annual revenue. Less than 13% of revenue comes from the US – didn’t see how much of that is books, I would assume much less than all. Arnaud Lagardere, current family member leading the group, has a net worth of about $2.4 Billion
Education sales accounted for 16% of total sales, illustrated books comprised 17%, Partworks represented 11%, and other sales were 16%. This only adds up to 60% – the other 40% isn’t publishing? Couldn’t tell from the available info.
Conclusion: financially, selling non-educational books in the US is not a significant enterprise for Lagardere, which is a media conglomerate. The subset that is SFF is a line item on the scale of office supplies, only smaller.
HarperCollins Publishers is a subsidiary of News Corp, the global media company led by Rupert Murdoch.
Financial: News Corp, Murdock’s holding company, had 2015 revenues of $8.633 billion; Harper Collins piece was $1.67 billion, about 20%. Murdock’s net worth is estimated at $13.1 billion.
Conclusion: SFF is, again, some tiny fraction of the activity of News Corp. Murdoch probably spends more each year on yard care.
Macmillan is a global trade publishing company, which is owned by the German Company Verlagsgruppe Georg von Holtzbrinck, with imprints in the United States, Germany, the United Kingdom, Australia, South Africa, and around the world. Macmillan publishes textbooks, journals, monographs, professional and reference works in print and online. Oh, yea, and some other books, too
Financials: As a privately-held company, Holtzbrinck doesn’t have to tell you much, and so doesn’t. 2014 revenues were 1.73 billion EUR; surprisingly, of that 1.64 billion EUR came from publishing, with 39% from North America.
Conclusion: Again, while books make up a bigger piece of the pie for Holtzbrinck than for others, it’s still unlikely SFF rises to anywhere near the top of their concerns – they’ve got that locked-in textbook/technical journals market to think of first.
Penguin Random House
Penguin Random House is owned by Bertelsmann, a private company, controlled by Germany’s Mohn family. It publicly discloses some financial data. It is one of the world’s largest mass media companies and also active in the service sector and education, worth about $30B by my rough estimate.
Financials: Didn’t come up with any hard numbers after a couple minutes of googling around, but it’s safe to say that SFF is not a major source of revenue for this gigantic company.
Conclusion: Elisabeth Mohn is worth $4.4B, and sits on the board of the Bertelsmann Foundation, which controls about $20B more. She ain’t sweating SFF sales.
Simon and Schuster
Simon and Schuster is currently the publishing arm of the media company CBS Corporation, and does adult publishing, children’s publishing, audiobooks and digital books. CBS has interests in commercial broadcasting, publishing, and television production, with most of its operations in the United States. (Aside: this curiosity: “The stories swirling around Sumner Redstone these days make Rupert Murdoch look like a boy scout.” Nope, not gonna bite. Nope.)
Financials: CBS had $13.88 billion in revenue in 2015. Google was not being very cooperative in digging up Simon & Schuster info in the limited time I had to search, but it appears they have annual revenues in the $750M-$800M range across all their businesses – not bad. I would imagine a comparatively tiny portion of that is SFF.
Conclusion: Sumner Redstone, the major owner, is worth $5.5B. He’s not sweating SFF sales.
A logical cool-headed business person would be thinking of dumping traditional publishing investments, as the long-term prospects of even the education/technical side are grim. Selling may not be possible for any reasonable price – it’s a buyer’s market, which is another way of saying that there are not very many potential buyers, and those who do exist are looking for a bargain. Crunching the numbers might suggest – and I suspect it does – that simply running the current publishers into the ground and writing off the wreckage is the least bad solution, financially.
Meanwhile, a prudent business person will be asking: What’s next? Can we get in on it early? Problem is it seems Amazon is what’s next, and they own every desirable piece of real estate they’ve noticed, and are well equipped to buy any they spot in the future. But hope springs eternal – you don’t get into business unless you are an optimist.
Mostly put this together so that I’m not completely ignorant of the topic, as it is a big deal in one way or another among several authors and commentators of some blogs I follow. The only thing left to say: eventually, in an open market (however imperfect) what cannot go on will stop. Hemorrhaging cash is not a viable long term strategy, although it can go on for a long, long time if it is a) small enough, and b) important enough to the owners. I will say with little fear of rebuttal that millions have been and are being spent by business types in order to figure out how to work this new state of affairs. So far, the evidence suggest they have not got a clue: Amazon is eating their lunch, indie writers and small presses are doing well, and the last of the big chain bookstores is watching the pretty trail in the sky left by that asteroid heading for the Yucatan.
(All right! Down to a mere 70 draft items once I hit publish on this one. Woo, and, I might add, Hoo…)
My company held its annual all-hands strategic planning day yesterday (two months ago – old draft), during which we had the inevitable review of current and future technology and trends.
I tend toward a grizzled veteran’s view of tech trends: if it’s obvious, proven and clearly will make or save a ton of money, it will only take 10 – 20 years to get adopted. A large part is that the providers and their inside champions need to sell the idea to mostly risk-averse management (1) – and that takes time. But the main factor, the one I’ve seen in just about every case, is that the people proposing the technology woefully underestimate how much trouble it will be for a company to implement it. I myself have committed this sin – I’ve tried to get people to use certain analytics without recognizing, at first, how difficult – well-nigh impossible – it is to get usable data upon which to do the fancy-dan analysis (2). Everybody – well, almost – thinks what I’m proposing is cool, and if they could get the data without having to design a massive IT project and get it funded, they might do it. In other words, it ain’t happenin’.
Take system integration. Now, things are mostly integrated – your phone gets emails and can access Wikipedia and perform stock trades and get you on an airplane, among hundreds of other things. Which is pretty darn cool. All it took was about 30 years of tech and infrastructure development costing billions, maybe trillions, to pull off. We old guys can remember, or were even involved in, efforts 30+ years ago to get things integrated. Everybody could see the value. For some levels of basic integration, the tech was there. The savings/revenues were obvious.
30 years later, headway has been made!
That said, we’re hitting at least the 10 year mark on Big Data. To me, a very lightweight math guy but possessed of some philosophy chops, the underlying concept of big data analysis are – fraught with risk sounds a little dire, but something like that. The simple, obvious risk is that we’ll get it wrong – that by applying Big Data analysis, we will come to think we understand things that we don’t understand. Then, with that confident misunderstanding – hey, it’s backed by Big Data! – we’ll make predictions and chart courses that don’t work, that have unpleasant unintended consequences, or lead people to take actions that harm people for no benefits. (3)
The other, larger problem is well-illustrated by those scenes from that Captain America movie, sort of psychohistory-lite, where Hydra claims, in a totally Big Data way, to have identified all the troublemakers out there, who will of course now, like so many Kulaks, be executed.
Nothing in the last century, certainly not J. Edgar Hoover’s blackmailing his way to the top nor 100 years of Chicago politics, would lead one to worry that Big Data would be misused, and the examples of the Soviet, Chinese, and Cambodian mass slaughter of unarmed civilians can’t possibly apply to this country – our socialist are like Uncle Bernie, not like Uncle Joe! Right?
So far, we see only benign things, like Amazon suggesting that, based on my other searches, I might be interested in the works of some guy named Homer. However, one thing has long seemed odd to me: Is it a coincidence that, once the Chicago Machine was able to apply its years of, um, expertise to the Federal government, Congress’s ancient jealousy of the White House infringing on its Constitutional powers seemed to fade away, after the manner of any opposition to J. Edgar? Would it be unduly mean-spirited to consider the possibility that a city with a porous government/mafia interface(4), as it were, would use the unprecedented domestic spying powers the government granted itself after 9/11 to reach an understanding with a few key congress critters?
Nah, that could *never* happen.
Effectively unlimited domestic spying + Big Data + political ambitions – any discernable moral restraint = uh oh.
Management is risk averse for very good reasons, as the paragraphs that follow show.
I’m working on another project at the moment that will, as a side benefit, collect exactly the data needed for the analysis – woot! Once more, dear readers, into the breech!
As I understand it, and I got this from reading some Google documents years ago, the premise with Big Data is that you do correlation analysis without first having any hypotheses about causality – you don’t know or even have a theory about what the relations should be. Then, by thus naively crunching huge amounts of data, trends and correlations will be revealed. Next, if you were doing it right, you’d create hypotheses about what *causes* those relationships, assuming that there is a cause (that it is not accidental in the Greek sense), and test them with further data analysis. But this last part is likely to get skipped. Some more or less innocent things will happen immediately (they are already happening): since people under 30 who use Uber on Tuesdays tend to order pizza when out of town, we’ll sell ads to out of town pizza vendors and push them at the victims whenever they travel! But there are other ideas that are not nearly so innocuous.
Fred Roti, a known La Cosa Nostra made man, who ran the Chicago city government for over 20 years as an alderman – the kind of alderman who always voted first, so everybody else would know how they were to vote – was only put away in the 1990’s. As Wikipedia so delicately puts it: “Roti’s legacy lives on through the many City of Chicago employees whose hiring he effected.” Ya think? Those would be the people behind our current administration.
Continuing along the theme of showing what happens in business versus what people imagine happens in business, another story from my youth:
In the small job sheet metal fabrication business, (1) one often uses dies. Dies are special tools often custom built to punch a hole of a particular size and shape, or form a particular indentation, or both. Dies are used with punch presses or break presses – the piece to be worked is placed in the slot in the die, the press presses down on the top of the die with sufficient force to cause the hole(s) to get punched and the shapes formed.
If you are going to make more than a few copies of some piece that requires a non-standard (e.g., not perfectly round or square, or not a common size) hole or form, it’s usually economical to have a die custom made for the purpose.
So, after the manner of the free market, people set up specialty die making companies. Now, auto manufacturers or, indeed, any manufacturers that make millions of things out of formed metal either have their own die making teams within their companies, or order from large die making firms. But a little shop like my father’s would do business with correspondingly small die makers.
For the life of me (hey, it’s been 40 years!) I can’t remember the name of the guy who was one of our die makers. He had a one-man shop, where he had the specialized equipment needed to machine the specialized alloys used in die making. We’d get new dies made once in a while – by the time I worked at Astro-Fab, we had built up a pretty good inventory of custom dies, many of which got used over and over again as customers ordered more of the same pieces. This die maker had made many of them.
This die maker was a good, solid craftsman. There’s no way my dad would have used him if her were not. But, it turns out, he was a pretty terrible businessman. Steve, my dad’s chief engineer, the guy who would spec out any new dies and the guy who would estimate work, ordered new dies as needed.
Steve took to doing estimates for our die maker. In other words, when he ordered a die, he would make a educated guess about how much it would cost our die maker to make it. Then, if the die maker came in with a cost that was much too low – as he often did – Steve would instead tell him how much he needed to charge in order to make any money. Steve would offer to pay his supplier more than what the supplier was asking for.
This of course was not pure altruism: we wanted the die maker to stay in business. He served our needs, and Steve feared he would put himself out of business if he kept losing money on his bids. As a small businessman himself, Steve understood that risk all too well – it was his job with Astro-Fab to make sure that didn’t happen. My dad thoroughly approved of keeping the die maker in business.
But if wasn’t pure self interest, either. The sort of risk-taking, high-energy people who go start their own companies do, in my experience, feel a sort of camaraderie. My dad knew what it was like to start you own business and put yourself on the line every day, to experience the excitement of success and the fear of failure, often at the same time. He and Steve sincerely wanted the die maker to succeed.
In Walker Percy’s The Movie Goer, there is a scene where the protagonist, a private investment advisor/stock broker, meets another businessman on a train. They have nothing in common, really, except that they are both businessmen. But they see someone who understands them, someone facing the same challenges. They part on completely friendly terms, vowing to help each other out if the opportunity arises. And Percy’s character is sure that those feelings are true and honest, that they would help each other out.
In his weird, insightful way, Percy is both making gentle fun of his characters, and yet pointing out something profound: that even over something as trivial, in the big picture, as business, people can find a chance to be truly human.
There are a fairly wide range of metal working companies, from giant steel mills down to super-specialized one-man precision shops. Astro-Fab, my dad’s shop, fell under the small job semi-precision sheet metal fabrication species. Semi-precision means we could get it real close – like, within a 1/100 of an inch – but were not, typically, getting much closer than that. For any greater precision, you’d want a machine shop or a specialized precision shop. Also, we didn’t do jobs that produced tens of thousands of items – that the ‘small job’ part. Larger shops could do those larger jobs more efficiently. Finally, we weren’t casting metal, but starting from standardized metal sheets (and beams, pipes, channels, etc.) – thus, the sheet metal fabrication part of the title.
Briefly stated, the Gell-Mann Amnesia effect is as follows. You open the newspaper to an article on some subject you know well. In Murray’s case, physics. In mine, show business. You read the article and see the journalist has absolutely no understanding of either the facts or the issues. Often, the article is so wrong it actually presents the story backward—reversing cause and effect. I call these the “wet streets cause rain” stories. Paper’s full of them.
In any case, you read with exasperation or amusement the multiple errors in a story, and then turn the page to national or international affairs, and read as if the rest of the newspaper was somehow more accurate about Palestine than the baloney you just read. You turn the page, and forget what you know.
I first became painfully aware of this when Proposition 1o3 was on the ballot in California back in 1988. At the time, I worked in insurance, and had first-hand access to the people and information on the ‘no’ side. What was amazing to me – hey, I’m congenitally naive – was how the concerns and goals of the insurance companies were consistently misrepresented. The only thing the press coverage of Prop 103 ever got right – you’ll be shocked – was that the insurance companies were in to make money.(1) They never made the connection between not offering insurance or having unaffordable rates and not making money, though – that insurance companies, *because* they want to make money, would not red-line or price themselves out of a market *unless* they could not make money at it. Not racism, not fear of poor neighborhoods, not hatred of teenage males, not dislike of cheap performance cars – but the simple fact that nobody had yet figured out how to sell insurance to certain demographics and make any money out of it.(2) Because, in the end, in the real world, businesses need to make money or they and the services they provide cease to exist. (3)
In an odd way, this story illustrates the point I want to make about how the Gell-Mann Effect is a special case of a more general characteristic of us humans: that when we learn something, we often fail nonetheless to make the obvious application of that knowledge to the next obvious case. Here, the reporters noted correctly that the insurance companies wanted to make money – in the shorthand of politics, that they were greedy. But then with the next breath, they’d report that these companies were obviously motivated by racism or sexism or something – even though the first bit of knowledge – they they were in it for the money – was an obvious and sufficient explanation.(4)
I have a friend who didn’t get his PhD in history for reasons that were never explained to him. The fellowships upon which he (and PhD candidates in general) relied upon to get him through the process, which were largely awarded by or based on the recommendations of the faculty, dried up. No explanation was ever given; no appeal ever brooked. He was just driven out of his program. (5)
Yet we argue regularly about beliefs inculcated or nurtured by universities as though they were somehow Gospel: a flat moral universe, Marxist analysis, the evils of capitalism and the US in general, just the mish-mash of ill-formed and irrational ideas that form the meat of modern post-secondary education. He himself knows first hand that the gatekeepers can keep out whomever they choose with no explanation, no chance at rebuttal, no appeal. Yet he does not therefore reexamine how it is that on almost all campuses everywhere in America some ideas are Accepted Wisdom while other are lumped together under Fascism or some other ism, and asking exactly how and why this is so gets the exact same treatment: No explanation is ever given; no appeal ever brooked. These bad ideas are just driven out of the impolite society of the desperate and vulnerable that make up the students and teachers.
Maybe we could call the more generalized idea the No PhD For You! Effect? I’m open to better suggestions.
In short, while it seems likely to me that this rigid compartmentalization is related somehow to how we humans are wired on some fundamental level,(6) our failure to see connections is nurtured and polished to a shiny-shine by the compartmentalization of subject and grade in school. Where a classic education invites us to see how math, say, relates to the real world, and how poetry expresses morality and human aspirations, how, in short, the true, the beautiful and the good are one, modern education separates and isolates ideas. By the time kids get to college, they are all but incapable of making such connections, and have never been introduced to any reason why one would want to in the first place.
Unlike the reporters writing the stories, who consistently turn down raises and promotions and give their excess earnings to the poor.
The history of the insurance industry is in large part the story of people figuring out how to make money selling insurance to people who couldn’t get it otherwise. So, you can be really sure, as sure as you are that insurance companies want to make money, that any number of insurance companies have devoted real resources to selling insurance to *everybody* who could need it, regardless of the race, age, address, and vehicles they drive. Not because they’re into social justice or are saints of some kind – but because they want to make money.
The company I worked for ended up moving their headquarters – and several hundred jobs – out of California, not so much because Prop 103 in itself made California unprofitable, but because it lowered the bar on demagoguery and stupidity so much that simple prudence dictated they not keep all their eggs in that political basket.
The personal anti-business, pro-socialist tendencies of the reporters muddy this up, of course.
The current Twitter kerfuffle, for another example, follows this pattern exactly. As I’ve harped on before, the signature feature of Hegelian (and, by extension, Marxist) thinking is that those who are unenlightened cannot be reasoned with – thus, purges are conducted without any need to hear the other side, and only explained for the benefit of believers. The victim himself is beyond help by definition.
For example, I’m not sure most people most of the time don’t simply keep the various things they learn separate for simple efficiency’s sake. I’m not sure guys like me, who lose sleep wondering about how Calvin’s Catechism affects modern analytic philosophy, or if hybrid vigor is, in itself, an evolutionary adaptation, for a couple examples, are actually favored in the race for survival.