A Quick Fix to Wealth Inequality?

I was having a chat with a friend yesterday about the incoming Canadian tax reform and he managed to inspire what I think is a rather interesting idea.

When it comes to modern finance, it’s a mess.  For the last few years, I’ve been trying to figure out a system of finance to account for the deflationary nature of technology and best practices while increasing productivity.  I think I’m close but it requires a complete overhaul of the system, and well as a cultural paradigm shift.  I’ll be patient.  Until then, I thought I’d mention an idea which works within the current system: Adjusting the local minimum wage to reflect the local cost of living.

If you’re working 40 hours a week, you should be able to earn a living.  That’s not to say that we should all be making the same, that’s to say that the floor should be set at what it costs to lead of modest lifestyle in that area.

Consider this, if someone is working 40 hours a week and living in poverty, they’re likely relying on social assistance programs.  Those social assistance programs are ultimately tax-payer funded.  That tax burden falls primarily on those who aren’t in poverty.  When someone grows up in a low-income neighborhood, falls in with the wrong crowd and ends up in prison, it’s the tax payers who pay for that too.  No matter how we look at it, we’re all in this together.  We either keep picking up the tab, or make an investment in the future.

For starters, imagine the impact this would have on the country’s collective anxiety – Knowing that if you work full time, you’ll be alright.  Now imagine the positive cultural impact of an entire generation of kids growing up with parents who aren’t barely getting by.  Now think about the reduction of people needing social assistance programs and the reduced government spending.  Now think about the reduced taxes for all tax brackets.  I guess we would call that trickle-up economics?  Just like trickle-down economics except rather than starting with helping those with the most and letting the residual benefits trickle down to those with the least, we start by helping those who need it the most and letting those residual benefits trickle up to those who need it the least.

The definitive test that trickle-up is better than trickle-down?  Trickle-up helps more people.

That all sounds pretty fantastic for people who are struggling to get by but that’s a rather large stone to toss in the water and it’s important to understand how this will affect everyone else in the pond, especially employers.

First off, businesses that haven’t embraced automation but probably should will likely need to.  The jobs which require the least amount of skill are often the ones which are easiest to automate so businesses will no longer need to rely on cheap labor to sustain their operations.  Fast food is already testing out automated ordering systems and burger flipping robots.

As the automation sector booms, the robotics and AI industries will boom and while not on a 1:1 basis, low-skill jobs will be replaced with high-skill jobs.

While measures like these will dramatically reduce low-skill jobs, I think they’ll also have the opportunity to redefine what we think of as an entry-level job.  If the objective is to have people perform at the best of their abilities, it’s about time we stopped putting young people in roles where they’re underutilized and calling it paying your dues.

The real victim in all of these is the entrepreneur who has to pay those increased wages though right?  Well if your business model relies on paying people a wage below what it costs for them to sustain, then yes – expect to be steamrolled.  If you can’t run a profitable business without the use of government subsidized labor, there’s a good chance you’re not fit to be running a business.

What about the businesses who do adapt, but still have to pay higher personnel costs because the average wage is now higher?  Because that’s real.  Well, it’s going to raise the bar for what we consider to be a well-run business.  Ultimately though, it means more money in the hands of the workers and less money in the hands of the owners.  Considering how the best entrepreneurs are motivated by the opportunity to create change, I don’t see the smaller paycheck making a difference – especially when you know that you’re putting extra food on the table of the team you built.

From an economic standpoint, if you systematically shift income from the wealthy to the working class then you’re looking at a far more robust economy.  More money in more hands makes for a much freer market as more people are inclined to make more decisions with their money.  Culturally, fewer wealthy people will mean mean a smaller market for luxury items and materialism may take on a more utilitarian feel.  From a philosophical standpoint, this is about equality in how we distribute the value we collectively create.

So set the local minimum income to be equal to the local cost of a minimum standard of living – seems reasonable.  Now set the minimum standard of living at a point which allows for a focus on personal development, providing them with the opportunity to become the most productive version of themselves.  Also seems reasonable.

 

I Think I Just Figured Out Flat Earth

So a good friend of mine, who most would assume is an otherwise intelligent individual, brought up the flat earth thing to me a few weeks ago.  It’s not that I was unaware of it, it’s just that I didn’t expect it coming from a friend.  After a bit of teasing, I humored him and asked him why he thinks the world is flat.

As it turns out, he didn’t necessarily think that the world was flat, it was simply a fun exercise in challenging the widely held belief that the world is round.

He asked me how I knew the world is round.  I told him that nobody falling off the edge was a good start.  He said that if they had fallen off, they weren’t exactly in a position to tell everyone about it.  Then I suggested using spatial reasoning to understand how someone could travel due east in a plane and end up at where they started.  So he asked how I knew a compass would take me due east.  I said by tracking the magnetic poles and letting you know where due north is.  He suggested that with a flat earth, the north pole would be a center point and where we think we would be moving in a 3 dimension circle around the planet’s equator, we would be moving in a 2 dimensional circle around the north pole.  Ok, but that would mean that someone couldn’t circle the globe by flying due south.  Has anyone?

I don’t know any off the top of my head but that seems like something that someone would’ve done.  He said that from what he’s read, apparently nobody does.  Huh.

I was tempted to start digging for sources to see if that was true but we were at a dinner with others so I tried a different angle.  What about satellites?   He said he didn’t know enough about satellites to know either way.  What about pictures from space?  You can CGI just about anything these days.  Huh.

So l asked us both to try and wrap our heads around how many people from all around the world would have to be in on this for evidence to have not leaked.  Astronauts, government officials, physicists, pilots, military, Redbull, Elon Musk, Stephen Hawking… and the list goes on.  Now consider how the scientific community has laughed this off while the flat earth community is absent of anyone with a PhD in physics.  I told him that it all seemed very unlikely.  He replied, “But it’s possible”.  I agreed, and then asked, “have you ever thought that we might be in the matrix?”

I think poker should be taught in school simply for the purpose of teaching probability.

I had to concede that we might actually be on a flat earth, not because I thought we were, but because I didn’t have all the necessary information to confirm otherwise.  What I did have though, was a strong enough understanding of other related factors which created a very strong case for a round earth.  The probability of a flat earth being kept secret from the general public for decades, if not centuries, is an extremely unlikely scenario.  If we hold the flat earth to be true, it literally undoes the laws of physics that we’ve come to understand.

I suppose that’s the beauty of it all though, it doesn’t matter how much you know, you can never truly confirm or deny anything.  Even if you have all the evidence you think is necessary, you still have to concede that none of this may be real.  Huh.

So if you can’t confirm or deny anything, if nothing is concrete, if everything is on a spectrum and nothing is entirely real, how do you proceed?  Probability.  Is the world round?  Probably.  Take one step forward.

What that conversation also highlighted for me was that most people probably believe the earth is round for the same reason that people used to believe the world was flat – because that’s what they were told and they assumed it to be true.  If it’s in our nature to challenge our beliefs, why are we so surprised that we’re challenging the belief of a round earth?

From my research on the flat earth theory, there seem to be two camps.  There’s the camp of people who genuinely believe that the earth is flat and aren’t interested in seeing evidence to the contrary.  Then there’s the camp who are saying that things don’t add up, and are looking for alternative explanations.  That’s legit.  There are plenty of things that don’t add up in this world and history would suggest that governments aren’t always the most accurate sources of information.  Alternative theories to explain events like 9/11, JFK or the moon landing are a healthy measure to keep people accountable to what they tell us.  If we just blindly accepted what people told us, we’d all still believe the world was flat, or round, or in a VR simulation operated by advanced aliens.

I just wish that for the sake of conversation, we could reach a point where we could speak a little more honestly about this stuff.  Is the earth flat?  Probably not, but did you know that Antarctica is bigger than Canada and barely anyone flies over it?  I wonder what kinda cool stuff has yet to be discovered there… wouldn’t that be the perfect location for a secret Hydra base?!

Let me try something..

Anyone remember that scene from Old School where Will Ferrell steps up to debate ‘The Ragin’ Cajun”, James Carville?

Curious enough, something similar happens to me from time to time.  Some people say that I’m articulate and well spoken but I may just be well rehearsed.  When I’m discussing something that I’ve given a lot of thought to, I’ve already had those conversations numerous times in my own head.  Perhaps that’s why my mind wanders when I’m giving speeches.  Perhaps even more curious, it’s often this state of mind which tends earn me that ‘mic drop’ moment.

Anyways, I had one of those moments in the shower earlier and I thought it might be worth writing down.  The debate question is:

What’s the real issue in American politics today?

Going into blackout mode…

 

This isn’t a black versus white thing, this isn’t a rich versus poor thing, and this isn’t a left versus right thing. This is what happens when politics becomes more important than governance.  This is what happens when a duopoly of power prioritizes the short-term success of their party over the greater good of the people they’re supposed to serve.

The American people have democracy, but in a democracy where you’re asked to elect someone you don’t know to run a system you don’t understand, what exactly are you asking of your people?  In an election process that requires billion dollar campaigns, who do you expect to be influencing those candidates?  In a system with such obvious fundamental flaws,  why do we keep expecting different outcomes?

When we start to notice what’s happening though, rather that acknowledge our mistakes and work to solve our problems, we’re given someone to blame.  If you’re rich, blame the tax raising democrats.  If you’re poor, blame the heartless republicans.  If you’re middle America, blame the coastal elites.  If you’ve lost your job, blame the immigrants.  If you’re a liberal millennial, blame the white man.  It’s all utterly ridiculous because when someone understands how interconnected we all are, it’s very easy to see that we’re all in this together.

The American people want freedom.  That’s the freedom to be whoever we want to be and love whoever we want to love.  That’s also the freedom for businesses to compete without unnecessary regulations.  The American people want lower taxes, but don’t mind paying them as long as they’re spent well.  The American people want someone working 40 hours a week to earn a livable wage.  The American people want to stop invading other countries.  The American people want affordable access to health care.  The American people agree on almost all major issues, but through the spin cycle of politics and media, everyone’s divided without even really understanding why.

The universe always finds it’s equilibrium.  Just after Trump was elected, I said this may be a good thing.  Not because he’ll be any good at his job, but because he might just be catastrophically bad at it.  Just maybe he’ll lie more than any politician ever has.  Maybe he’ll flip flop all of his policies.  Maybe he’l have temper tantrums so frequently that people question if he’s mentally fit enough for office.  Maybe he’ll let his racist undertones influence policy.  Maybe all the shady stuff that he’s done in the past will come to boil over during his presidency and we can finally have a complete meltdown of the confidence in our government.

Maybe that’s when we stop paying attention to them, and start paying attention to each other.  Maybe that’s when we start to drive our own rhetoric around the values that got us here in the first place.  Maybe that’s when we’ll finally open our minds to what government could be.

 

Honest Modesty

There’s a fantastic quote from Bruce Lee, “If I tell you I am good, probably you will say I am boasting.  But if I tell you I’m not good, you’ll know I’m lying.”

By most people’s standards, Bruce Lee wasn’t just good, he was one of the best to ever do what he did.  But if he were to say that, then he risks being labelled as boastful.  Why?

The Rick side of me wants to say that those with insecurities about their own abilities would prefer that high achievers understate their skills and accomplishments to minimize feelings of inadequacy and inferiority.  They key word there being feel.

The more patient side of me thinks there’s another level to this.  Honesty is communication in it’s most accurate form.  When you’re being honest with others, you’re giving them the most accurate version of the information you have.  When you’re being honest with yourself, you’re looking at the most accurate version of yourself.  As working with accurate information is always more efficient than working with inaccurate information, honesty is key to an efficient life.

I also value modesty.  For me, modesty is a perpetual state of mind in which I remind myself that there’s always more room to grow and that what I’ve accomplished isn’t nearly as important as what I’m working towards.  Google’s definition of modesty is an unassuming or moderate estimation of one’s abilities.  I can work with that.

Unassuming and moderate are worth exploring here.  For me, unassuming means knowing your value, but also leaving your mind open for the things you don’t know.  For example, an unassuming fighter would know the techniques they’re best at, but wouldn’t assume to know how successful they would be against a hypothetical opponent.

In a universe with nearly infinite variables – most of which are unknown to us – any prediction of the future is an assumption.  Being unassuming is simply a more honest and accurate understanding of yourself and the universe you exist within.  Being moderate, in this case, could probably be defined as without bias.  Without a desire to understate or overstate one’s abilities, the middle ground would be a moderate estimation – again, the most honest and accurate understanding.

Perhaps there will always be people who would prefer that high achievers keep their achievements to themselves to minimize feelings of insecurity.  For the rest of us however, I think it’s important to understand that modesty isn’t a function of class, or making others feel better about themselves, it’s a function of honesty and accuracy.

If you’re great, be great, do great.

 

Random Inventions: The Nice Horn

I often observe behavior on the road and try to use that behavior to better understand the driver behind the wheel.  What does it say about a person when they’re weaving from lane to lane without signaling?  What does it say when they don’t notice that the light has turned green?  What does it say when they’re content cruising along at exactly the speed limit?  I find human behavior to be fascinating and seeing how we interact on the roads is certainly a unique glimpse.

It occurred to me a while back that despite how well coordinated drivers have to be with one another to avoid accidents and maintain order on the road, we’re not given much to communicate with.  For the most part, it’s just the horn.  The horn is not the most pleasant sound.  When most people use it in anger and frustration, most people probably perceive it as an aggressively unpleasant sound.  When our only mode of communication with one another on the road is aggressive unpleasantness, I wonder how that impacts how we drive.

So why not a secondary horn, with an audible sound that implies ‘thanks!’?  I know there’s the double tap of the standard horn, but still, why not a secondary horn?  No one blink screw you, two blinks for thanks, a genuinely happy sound that says I appreciate your conduct on the road.  Simple mechanics, simple market research effort to determine the sound, and a meaningful step towards more positive lines of communication with one another.  I’m looking at you Elon..

Analogies: Capitalism

a long time ago, someone designed a car.  It was beautifully engineered and truly revolutionary.  It was so well designed that it was pretty much built to last forever.

While the car was a something for the history books, the drivers were inconsistent.  Some understood the mechanics and drove respectfully.  Some showed less regard for the car and drove as it suited their agenda.

Along the way, drivers began allowing for more passengers.  Some for altruistic reasons, some because they paid, and some for the sake of personal relationships.

The car was built well enough to handle a few extra passengers, but as passengers increased and time wore on, key parts of the car started to wear down.  All the added weight was creating excessive pressure, leading to wear on parts that the car couldn’t function without.

Some of the older passengers are looking out the window saying the car looks just fine.  They can tell that the ride is bumpier but it’s hard to notice in a cushy seat.  They know that car was built to last and they know it’s gotten them this far.

Those who are more familiar see that the car is unsustainable.  If we maintain this rate of passengers, the car will fail.  If we want to reduce the amount of passengers, we can keep the car on the road.

Ironically, we’re so focused on the survival of old reliable, that we haven’t given any thought to the new models.  Technology changes everything.  As great as that car was, modern technology has changed how we get from point A to point B and it’s important to appreciate those changes.  There are ideas which we didn’t have the technology to pull off before but could be more viable today.

It’s dangerous assuming there’s no room for improvement.  Might be a good time to look at some options.  Even better, why don’t we look at what we need from our car, learn from our peers, and build something new and inspiring from the ground up.

 

 

 

Real Diversity

Google is a pretty big deal.  They hire cool people, they make cool stuff, and they’re arguably the world’s most valuable company.  I’ve been studying Google closely for over a decade and one of their most impressive assets has always been their organizational culture.

Recently, a Google engineer wrote a 10 page memo outlining his thoughts on diversity in tech.  Coverage of this memo made it to the front page of just about every major news feed and the  loudest commentary has been pretty one-sided… something to the effect of ‘how dare he?’

After I read the first article referencing the memo, I got the gist of what was going on.  A male employee said some things which suggested that men are better suited to work in tech than women.  Then I read a few of the comments after the article and got the gist of what was going on there too… men and women are equal in every way and to suggest otherwise is offensive, immoral, and shows a lack of empathy and understanding for the systematic oppression that white men have put on all other minorities since forever.

Oy.

Recently, a well-known tennis legend suggested that Serena Williams was the greatest female player of all time.  Then he was asked why not the greatest of all time instead of the greatest female player of all time?  To which he responded by saying that she wouldn’t do nearly as well on the men’s circuit.  I thought that was a fair and accurate understanding of the situation and by no means diminished Serena’s legacy.  I think it’s also fair and reasonable that in order to claim the title of greatest tennis player ever, you’d have to be willing to compete against the best tennis players – regardless of their gender.

This all seemed pretty straight forward to me.  Men and women have evolved differently over the millennia and while women became better equipped to care for the family, men became better equipped for the role of hunting and gathering.  The evolutionary advantages which men have acquired tend to make us better athletes thus providing an inherent advantage when competing in sports.  If that’s true, is possible that other evolutionary differences exist between men and women?

One of my biggest struggles with romantic relationships when I was younger was that I expected the other person in the relationships to see and understand the world like I did.  Eventually I was given that book about women being from Venus and men being from Mars.  While I didn’t read it, hearing a few passages was enough to help me understand that men and women are wired differently and that it was important to keep those differences in mind.  While I think the most significant differences come down to the people themselves, the most consistent pattern I’ve seen in the difference between men and women is that men tend to lean towards logic while women tend to lean towards emotion.  If that’s true, wouldn’t men – on average – be better suited towards jobs that relied heavily on logic skills?

In the pursuit of understanding, I asked two of the most intelligent feminists I know about evolutionary adaptation giving men the abilities to do certain tasks better than women.  One said that she didn’t want to get into it because it was too much emotional labor.  The other was offended by the idea and then said that she was too reactive to have the conversation. Ironically, in the second instance a nearby cardiologist chimed in saying that she agreed with the evolutionary perspective but pointed out that there were always exceptions (like women being better open-water long-distance swimmers because of their fat distribution).

Back to the Google memo.   If you were just going to read headlines and comments, you’d think that this kid was a contributor at Breitbart and that his ‘anti-diversity manifesto’ was right-wing propaganda that was designed to prop up white privilege and repress visible minorities in tech.  None of material referenced in this articles actually showed that perspective and knowing that Google typically doesn’t hire right-wing nut jobs, I sensed a disconnect.  So I tracked down the original memo and read the whole thing.

It’s not that bad.  In fact, it’s kinda good.  The opening line is, “I value diversity and inclusion, I am not denying that sexism exists, and don’t endorse using stereotypes.”  There are several more points throughout the memo that provide the necessary context to understand that James Damore values diversity, and wants to see diversity in the workplace, but thinks that a diversity of the mind is more important than a diversity of the body.

In the pursuit of that point, he suggests that there are several reasons why we’re likely to see lower numbers of women in tech.  He acknowledges that there is a systematic oppression of women in tech, but says that this might only be part of the issue and that part of it might be evolutionary.  He goes on to reference several studies which compare personality traits between men and women, suggesting  – on average – women have higher levels of anxiety and don’t cope with stress as well as their male counterparts.  Ironically, I had actually reviewed many of these studies a couple weeks prior as I was exploring evolutionary differences as a result of the Serena Williams conversation.

Science itself is an evolutionary process and from what I’ve read so far, the scientific community has a consensus that men and women are wired differently.  Where it becomes more grey is in how that develops into aptitude.  I suspect that with the ground that women have covered in the last 100 years and recognizing that the female population in post secondary education now eclipses men, the next 50 years will look much different than the last 50 years.  If we do it right, both men and women will have the opportunity to choose the profession that they’re best equipped for – but I don’t think that means that every job will have a equal representation of men and women.

I think that equality is a core concept to any prosperous society but I do think that the populist understanding of equality needs to evolve.  Equality is about equal opportunity, not equal outcome.  In the world of equal outcome, everyone receives a PB&J sandwich for lunch.  In the world of equal opportunity, everyone is given an opportunity to make the sandwich they want to eat.

Everyone is born a little different and it is a life built on that deviation which truly makes us unique to the world.  Because we are unique, each of us has the ability to provide something to the world that no one else can and it is the delivery of this gift to the world which I think makes us truly happy.  I know that’s a bit abstract and maybe even a bit fluffy so on a more grounded level, we’re all a little different, we all have a unique aptitude, and deploying that aptitude in a manner that helps us get closer to our maximum utility is likely what will make us happy and fulfilled.  If that’s true, isn’t true equality giving everyone the opportunity to reach their own, unique maximum utility?  If tech is biologically better suited for men, reaching a 50/50 quota of men/women will mean women who would otherwise be better suited and happier doing other activities will work in tech and men who would be best suited for tech will have to work in another field because those spots have been taken.

As hard as it can be to make this connection for some, it always comes down to an equation of efficiency.  The most efficient course of action is to encourage people to pursue careers in fields which will help them reach their maximum utility.  That’s a career which would see them happiest, most fulfilled, and creating their greatest contributions to society.  A perfect society is one in which everyone operates at their maximum utility and I think that’s the ideal of equality that people are pursuing – many just haven’t figured out how to get there yet.

The last thing I’ll touch on here which may be the most important part of this conversation is the lack of conversation.  I think that what I’ve written here would suggest that I agree with James Damore’s assessment of women in tech.  I don’t.  I think that he references some valid information, I think that he makes some coherent points, and I think that he’s legitimately looking to advocate for an ideological diversity over a visible diversity because at the end of the day, it’s what’s on the inside that matters.  I also think that there are too many unknown variables to draw direct conclusions between evolutionary biology and aptitude for jobs that didn’t exist 25 years ago.  The social, cultural, academic, and systemic variables are key in understanding this dynamic and they’re changing faster than we’re currently able to understand them.

If understanding them is a priority for us, we need to invest in the discussions that will flush out the real questions and invest in the sciences that will give us that data to answer those real questions.  I don’t agree with James Damore, but I absolutely agree with how he presented his thoughts and it is a remarkable failure when our ability to challenge these ideas devolves into comments like ‘this doesn’t even warrant a response’, or ‘how dare he?’.  It shows a lack of understanding of the topic at hand, a fear of opposing ideologies, and reluctance to engage with someone who doesn’t agree with your perspective.  James Damore was fired from one of the most important companies in the world because he intelligently argued a perspective not shared by the majority of his peers.  In the pursuit of diversity, Google just took a major step towards preventing the diversity of ideas.