Human beings evolved in tribes. Everybody knew everybody in the tribe.
Governing us with systems is an attempt to extend the concept of tribe out to a country of 370 million or 1.2 billion people.
In business this would be called 'scaling'.
The benevolent Tribal Chief model can't work in countries with millions of people.
So we have to have some system that does work.
I think Capitalism fits the bill at the local level. Nothing else has ever worked. Also you have to have laws written down because things are no longer decided by the chief, because that would be impractical. So getting people to mostly agree on fixed laws is a good system.
Capitalism is a great economic system but runs into a problem when companies get to a certain size. The scaling doesn't work.
For example, if you have a company doing $10 billion of profit per year, then think about how important it is to have the best CEO.
If CEO A is 1% better at his job than CEO B, then the company stands to gain or lose $100 million dollars depending on which CEO they have.
This is what leads to utterly outrageous salaries and bonuses, at least at face value.
In reality, nobody has any good way to judge if one CEO is 1% better than another.
You end up paying a person $50 million dollars to make phone calls and answer emails, just like we all do every day. In my view this is an irrational result. It is ridiculous.
This is exactly what I mean when I say that capitalism doesn't scale up very well.
And now, when we allow companies like General Motors to be international, it causes a huge problem. China has 1.4 Billion people, 4x the number of people in the USA (329 M). So when you allow General Motors to enter the Chinese market, suddenly they care a whole lot more about making the Chinese Communist Party happy than the US Government or the US people.
See? That problem crops up again. Capitalism doesn't scale well. We end up with American Companies that are no longer American any more. They end up being more Chinese than American because that is the rational thing for them to do, since a business' profit is the main motivator.
So I don't have any solution in mind. Certainly not Socialism or Communism, which both bring complete misery. I do think whatever system that could work would use capitalism up to a certain size of business where it stops being reasonable.
Here's what I believe, fren.
Human beings evolved in tribes. Everybody knew everybody in the tribe.
Governing us with systems is an attempt to extend the concept of tribe out to a country of 370 million or 1.2 billion people.
In business this would be called 'scaling'.
The benevolent Tribal Chief model can't work in countries with millions of people.
So we have to have some system that does work.
I think Capitalism fits the bill at the local level. Nothing else has ever worked. Also you have to have laws written down because things are no longer decided by the chief, because that would be impractical. So getting people to mostly agree on fixed laws is a good system.
Capitalism is a great economic system but runs into a problem when companies get to a certain size. The scaling doesn't work.
For example, if you have a company doing $10 billion of profit per year, then think about how important it is to have the best CEO.
If CEO A is 1% better at his job than CEO B, then the company stands to gain or lose $100 million dollars depending on which CEO they have.
This is what leads to utterly outrageous salaries and bonuses, at least at face value.
In reality, nobody has any good way to judge if one CEO is 1% better than another.
You end up paying a person $50 million dollars to make phone calls and answer emails, just like we all do every day. In my view this is an irrational result. It is ridiculous.
This is exactly what I mean when I say that capitalism doesn't scale up very well.
And now, when we allow companies like General Motors to be international, it causes a huge problem. China has 1.4 Billion people, 4x the number of people in the USA (329 M). So when you allow General Motors to enter the Chinese market, suddenly they care a whole lot more about making the Chinese Communist Party happy than the US Government or the US people.
See? That problem crops up again. Capitalism doesn't scale well. We end up with American Companies that are no longer American any more. They end up being more Chinese than American because that is the rational thing for them to do, since a business' profit is the main motivator.
So I don't have any solution in mind. Certainly not Socialism or Communism, which both bring complete misery. I do think whatever system that could work would use capitalism up to a certain size of business where it stops being reasonable.