systemic corruption

Interstate Commerce: Trade Barriers Between States

Doctor sees patients via Internet

Doctor sees patients via Internet

Ilya Somin has a post at Volokh/WaPo about “foot voting” (people choosing to move to jurisdictions that have local governments that reflect their values or offer economic opportunities lacking in their current home areas.)

One phenomenon often discussed is migrants bringing their voting habits with them and voting into place local governments that duplicate the conditions in, say. California (they are said to “Californicate” the new area.) People who move because of economic opportunities may have no understanding that the existence of the better job opportunities and lower costs of living in the new place owes much to more enlightened, less business-suppressing tax and regulation in the new location. Since they never realized those business-unfriendly California laws were suppressing local opportunities that might have kept them there, they don’t modify the type of politicians they support and so begin the process of bringing Progressive political machines and micromanagement to their new homes.

Outside observers look a country like India and wonder why reform of internal trade barriers, which are relics of the pre-colonial states, are widely understood to be prosperity-enhancing, but progresses very slowly if at all. Products made in one Indian state can’t be sold to a customer in another without paying additional taxes or being blocked by local content regulations.

In the US, regulation of interstate commerce was intentionally made a Federal matter, making the US a free trade area. This aided in creating the world’s largest internal free market and allowed local industries to grow up specializing in one manufacturing segment to serve a national market — regions specialized in furniture, shoes, textiles, steel, and so on, aided by economies of scale and able to take advantage of local resources that gave them a national advantage. If each state had been able to put tariffs on incoming products or block shipments from other states by regulation, the nation’s growth would have been stunted.

But services and professions are still licensed by states and even smaller units. To braid hair or do massage in a town can require licenses from both state and local authorities, with professional guilds using such licensing to block competition. This prevents poor entrepreneurs from finding work providing services and increases costs of those services for poor consumers, all in the name of consumer protection.

At the higher end, doctors are cartelized and regulated by states as well as the Federal government, which runs the subsidies and residency schemes that keep production of new physicians expensive and restricted. Healthcare services that could easily be handled by less expensive technologists are often required to be provided only under a licensed doctor’s supervision, pumping up the incomes for even the worst doctors (who may use their credential to take jobs in prison or institutional settings where their record of incompetence is ignored because their license is valid.)

New technology that might allow low-cost Internet doctoring by out-of-state or even out-of-country physicians is blocked in most states. Concern for consumer health is always cited as the reason, even when poor consumers can’t afford to seek any face-to-face care for their health issues. It is apparently better to go untreated than to allow the poor to buy “good enough” services on the Internet. The inability of above-board, higher-quality companies to run such remote doctoring systems leaves the field open to bootleg quacks.

So even the US is not truly a free trade zone, since many services (cable TV, real estate, medicine, restaurants, schools) are heavily regulated by state and local governments, and outsiders trying to break in face high barriers to entry. Big companies can overcome the need to manage 50 or more different regulatory regimes, but smaller chains just starting out have to choose wisely and only expand in areas where the regulatory environment is more supportive.

Not surprisingly, the result is vigorous competition and lower prices in less regulated areas, and sluggish investment and higher prices in more-regulated areas.

It’s clear that Federalism (state and local control) applied to service regulations is costing the economy growth and raising prices in an era where barriers to travel and communication have come down. Medical, teaching, and real estate professionals should not have to undergo licensing in every jurisdiction where they might practice. Cities and towns should not be able to extract concessions from a monopoly cable TV-Internet provider which result in high prices and no local competition.

Perhaps we should thank those Progressives who battered the Supreme Court into submission and started making the case that every local economic decision could be regulated by the Feds, since even the tiniest decision locally has some effect on the national market, no matter how minuscule.

The Progressives opened the way, so now it would be constitutional to overrule all local and state licensing of professionals, insurance companies, and other services, which could now be much more competitive in a true free national market. So if they wanted to, Congress could rule all medical and communications services licensed in one jurisdiction to be sellable in others. nationwide insurance policies would provide travel flexibility and economies of scale, and these companies could provide services via Skype examination that would undercut local doctor and hospital cartels. Sick people in the Bronx projects could be “seen” and prescribed treatment and medication from doctors in low-cost South Dakota, say. “Oh, no!” cry the Progressives, “They could be quacks!” And the products sold in New York from manufacturers in South Dakota, Michigan, or even China could be fakes or defective. Yet we tolerate the free trade of goods because it is in the long run best for everyone, and the wholesalers and retailers of goods have an interest in keeping bad products out of their systems. And now that low-skilled manufacturing jobs are mostly outside the US, isn’t it interesting that professions and industries that benefit from barriers to trade in services — lawyers, doctors, communications giants, drug companies, public schools — resist any effort to open themselves up to competition.

In “Death by HR” I discussed one remedy — a “Freedom of Contract” Amendment to the Constitution to clarify the Common Law right of adults to contract with each other and service providers in any way they choose. If I choose to buy a product from a Chinese company, I deal with the risk and consequences. I should be allowed to buy services from anywhere I want — to have my skin lesions imaged to a doctor in Florida, to have the treatment done by medications from a pharmacy in Oregon, to have a local contractor handle any hands-on services, and so on. The key problem with many necessary services today is regulation and a resulting lack of low-cost options. This is especially true in medicine, which Obamacare only made worse by restricting practical treatment options to small geographic regions. The solution is radical deregulation.


Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[Death by HR: How Affirmative Action Cripples Organizations, in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat…. It is time to turn the tide against this madness and Death by HR is an important research tool…  All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.


More reading:

A Clinton Christmas Carol
“High Tech Under Diversity Pressure
Ban the Box, Credit Scores, Current Salaries: The Road to Hiring Blind
HireVue, Video Interviews, and AI Job Searches
“Death by HR” – Diversity Programs Don’t Work

Tom Woods Commenter Dialog: “Death by HR”

[Death by HR: How Affirmative Action Cripples Organizations]

The Tom Woods podcast on Death by HR is here, and on Youtube here.

On Tom Woods’ site, a commenter with a long career in HR had a number of criticisms of the interview, though he had not actually bothered to read the book — the HR version of “skim until offended,” jumping to conclusions about the content of the book and spending more time criticizing and reacting than looking deeper. But he had a lot of interesting things to say about his career, apparently working in mostly smaller and poorly-managed companies where managers frequently used their position to act arbitrarily based on ethnic, racial, or sexual prejudices, or put their own satisfaction ahead of company goals.

 

  • Perhaps if Tom Woods wants someone to evaluate the HR function from a libertarian or Austrian Economic perspective, he should actually talk to someone who has worked in the field? Next week, an exposé on the internal waste at NASA, the guest will be a jack hammer operator from Arkansas, who obviously has the inside scoop…

    I’ve worked in HR and recruiting for over a decade now. Like any other department you’ll find in a company, it can be staffed with idiots or geniuses, but mostly it’s people who are somewhere in between. There are more than a few issues this guest brought up which are complete BS.

    One, performance evaluations and legal risk. First, the legal risk for employers viz a viz their employees is next to zero in the US. With the exception of California, if you ask an actual labor lawyer if you can or should sue for X, Y, or Z, they will almost unanimously tell you that you can’t, or you can try but you won’t likely win. If you’re a member of a protected class, say a minority, and you have your boss on tape screaming racial epithets at you for hours on end before firing you, you might have a case. In this instance if they do have those performance evaluations they can use those to prove you were fired for legitimate reasons. And, unless you have a slam dunk case, no lawyer is going to take your suit on spec, so you’d better have a few grand to float as a retainer, and even if you win, the judgement won’t be as impressive as many assume.

    So for all practical purposes most people wanting to take advantage of the few laws that actually do offer some form of legal protectionism to labor in the US are &^% out of luck. Generally speaking, the answer lawyers will give you is yes, you can be fired for that, or like that, or abused or even physically assaulted at work (I’ve seen it happen multiple times), and you generally won’t have luck suing, unless you’re in California which has laws which diverge significantly from the rest of the US.

    In the above case the performance evaluation does serve the purpose the guest was mentioning, however in over a decade of experience I’ve seen them save more jobs than justify terminations. My favorite example was an employee who was moved through the process of disciplinary action to the point of being fired, the company at that time kept HR out of the process as much as possible, until the end where we came in to make sure everything was kosher. The employee was a woman with a very hard to find skillset at that point, because we were a manufacturer and there was little to no manufacturing left in our area. What was all the fuss about? It turns out the manager didn’t like the way she was opening, positioning, and sizing her email windows on her computer while she was doing her job. He had a process, ya’ see, and it involved micromanaging the movements of her frigging mouse. Her actual performance</i.>alsotolerate working for and with this moron.

    That is one example of a multitude I could lay out, which addresses another claim of this guest: managers know what they’re doing, and how to evaluate and reward their employees. After ten plus years of experience, to say I beg to differ is to put it mildly. In fact, that’s one of the most riduclously detatched from reality statements I’ve heard in my entire life. Most managers are just regular employees who were promoted. No one ever checked to see if they wanted to be managers, and often when they did want to be, it was because they didn’t see any other career progression, and so assumed they had to be managers. No one ever checked to see if they had any aptitude for the position, either. They were just the best at their job in someone’s estimation, and God only knows if that person had any particular skill in managing people, and that person clapped them on the shoulder one day and said, “Congrats, kid, you’re in charge now, so good luck!” Rarely if ever is any training even offered to these people, check corporate training budgets. They’ve gone through the floor over recent years. In my entire career I’ve met three or four managers who actually had a clue what they were doing, and I’ve worked with hundreds at this point, maybe over a thousand; directly for a few and with many more as an HR and recruiting person.

    In my years of experience the biggest problem I’ve had to deal with in HR and recruiting is not government compliance, which is an annoyance and yes, sometimes a big one, but rarely more than that. Nor has it been enforcing ‘diversity’ hiring, most small to medium sized companies couldn’t care less. No, the biggest issue has been managers running off the reservation and doing stupid things, or refusing to do their jobs. My favorite example in this regard was a manager who demanded to only hire Mexicans because they were better performers. They weren’t, actually. This guy’s top performers were all of Indian desent, with the top half of his performers not showing any particular trend in ethnicity. However, Mexicans it turned out were less apt to question him, and treated him like a god on earth. So, should HR not have stepped in and told this idiot he had to hire for actual performance reasons? Should we have let him sink the company with potentially worse overall performance and also potential legal risks just to stroke his ego? Again, one story like this of a multitude, one of the other prominent ones involves an IT department manager who would only hire Romanians. To his credit his department at least functioned well, but it drove the costs of hiring up because we had to cycle through tons of qualified people before we found someone for him to interview who had the right ancestry.

    Or how about a company owner who refused to offer flexible schedules? Great one that, because a manager that was also a close personal friend of his offered it to his employees anyway. That department’s performance went way up, their absenteeism went way down, their retention was up, every single positive indicator was up. The owner finally admitted to the head of HR, who had been pushing for this policy, that he made a mistake. Plans were made to roll it out company wide, at the last minute the owner walked into a meeting and started screaming at people at the top of his lungs about how he wasn’t going to ‘give anything away’ to his employees just because he could. The plans were scrapped. There’s the overly managed and controlled market people deal with every day, a business own deliberately doing something to lower his company’s potential productivity because there are so many people desperate for jobs, why not? You can just throw away the burned out ones and replace them for the most part, it’s only in demand skills that require any ‘special’ attention, and by ‘special’ I mean not treating them like emulsified balls of ferrett crap.

    HR can seem like a fiefdom sometimes. We do have to exclude people and keep secretive to a degree. Unless of course, you want your personal information sprayed all over the office for everyone to see. We have to deal with everything from deaths in people’s families to people with diseases or conditions who want to work, and do so quite well, but might need an accomodation here or there, and might not want the entire office to know their business. All manner of personal business which people want kept confidential, for all kinds of reasons, which might affect the business and how we do things but which, generally speaking, not everyone has a right to know if we can keep it confidential. So we do. It’s a fiefdom because too many managers are apt to screw it up if they get involved.

    In all my years of experience, when managers wanted to do stupid things, it was HR who stood in their way. When managers and business owners were assured that working for them was a privilege and people should consider themselves lucky to be there, it was HR who stepped in and told them they still had to pay attention to compensation levels and work-life balance, and that those things mattered if they didn’t want to burn through their entire available candidate pool in less than a year, no matter how much of a ‘privilege’ it was to work there.

    Over the decades in the US every possible job-killing protectionist racket has been tried, and the currency has been continuously debased. Those policies concurrently destroy competing job opportunities and devalue wages, keeping labor’s share of the expanding pie always lagging those of firm’s owners and financiers. Go ask Sean Corrigan, he pointed out as much in one of his Mises talks a long time ago. While that’s happening, HR does deal with a bit of government BS and compliance. But our main role is, in my experience and ironically enough, to try and stop companies from destroying themselves from within with idiotic and destructive policies towards their labor simply because they think they can treat people like crap because labor has been at a near permanent disadvatage thanks to over a century of idiotic policies and currency manipulation. This is increasingly hard to do in an economy where many companies would prefer some form of indentured servitude on a managed market where their competition is strictly limited, rather than to compete for free labor on an actual free market, because they’ve never known anything else. They wouldn’t know a free market if it bit them on the ass and called them daddy. And HR, whether you like them or not, is usually the department standing between the employees and the employer, constantly reminding the latter that to treat the former with at least a modicum of respect is just good business sense. Not everyone is lucky like me, to work for a company where the employer actually seems to care about its employees. Most work for people who would happily throw their employees’ children into a woodchipper if it meant a .000000000000001% increase in quarterly profits.

    Maybe next time Tom Woods wants to talk about HR, he can talk to someone who actually works in… HR. I’d recommend Liz Ryan or Peter Capelli. Both are recognized in the field, I have no idea of their political or economic leanings though I get the feeling they’re both lefties. But they’ve at least worked and published in the field, which is a massive leg up on this guest. Lazlo Bock over at Google is another person worth talking with, or Dr. John Sullivan, who writes regularly for Ere Media. It’s not like there’s a shortage of people in the industry, God only knows why Woods decided to talk to some random guy who had a bad experience getting a mortgage once and decided to write a book. Having worked with many people who saw HR as some sort of obstacle, I can say unequivocally that sometimes they were right, but way more often than not HR was just the obstacle to them enacting their own stupidity at the expense of the company and people’s livelihoods. That’s an obstacle I’m happy to count myself among.

    • Recruiter –

      I hope you get time to actually read my book. In a short interview there’s not enough time for nuance or depth. I consulted many sources and quite a number of HR managers, but more importantly mid-level managers who only see HR staff when there’s trouble. And most of my sources are in engineering and technology, so the high quality of both employees and managers make HR less helpful and more culturally unlike the general staff. I did make a point of acknowledging the many hardworking HR people who put out the fires and work hard to promote the business.

      But since my book is a polemic – intended to be a corrective for the hundreds of other books cheerleading for current HR fads and elevating the importance of HR for an audience of HR specialists who of course want to promote their own specialty above others – it focuses on the negative and the worst excesses of HR staff less competent that you say you were.

      Every bureaucrat thinks they work hard to hold back the tides of chaos. You probably worked very hard, and of course you were called in when some manager had screwed up, so your dim view of managers generally is understandable. Your view that low and mid-level managers are accidents waiting to happen and only enlightened guidance from the likes of you kept them from disaster is just a tad skewed. What business is foolishly promoting people with no emotional intelligence, manners, or good business sense into management? What industry did you work in that had such incompetent and insensitive managers?

      One, performance evaluations and legal risk. First, the legal risk for employers viz a viz their employees is next to zero in the US. With the exception of California, if you ask an actual labor lawyer if you can or should sue for X, Y, or Z, they will almost unanimously tell you that you can’t…

      Most of my sources – and most of the technology industry, which was one of the focuses of the book – are in California, specifically Silicon Valley, and if you had actually read it you would have seen cases and excerpts from attorneys involved in litigation, defending against state regulators and class action attorneys suing under California’s antiquated labor laws specifying things like break times, proper seating, and temperature for workplaces long since evolved away from factories.

      It’s true that most lawsuits of alleged discriminatory firing don’t go far, but the threat is only manageable because companies have taken defensive action by staying aware of the possibility and starting a documentation trail of poor performance a year or more before the intended firing. Costly settlements still happen (quietly, of course) to avoid legal and reputational costs.

      In my entire career I’ve met three or four managers who actually had a clue what they were doing, and I’ve worked with hundreds at this point, maybe over a thousand; directly for a few and with many more as an HR and recruiting person.

      In the companies I’m familiar with, new managers get guidance from their own managers and those who don’t show some decent understanding of their role do not progress further. Since you are steeped in HR, you think “training” is the answer – like any quasi-government bureaucrat, you think a program and a certain number of hours in a classroom is needed to impart the common sense and emotional skills to manage diverse people to get a job done. And you resent that no one has given HR budget to set up training programs and pull skilled people away for days of nonproductive paid time to be enlightened by HR staff and their favorite contractors.

      My favorite example in this regard was a manager who demanded to only hire Mexicans because they were better performers. They weren’t, actually. This guy’s top performers were all of Indian descent, with the top half of his performers not showing any particular trend in ethnicity. However, Mexicans it turned out were less apt to question him, and treated him like a god on earth. So, should HR not have stepped in and told this idiot he had to hire for actual performance reasons?

      This manager should have been fired – and in any well-managed company with smart employees, he wouldn’t have lasted five minutes. The companies I know of would have had peer managers and upper managers detecting his incompetence and he would never have been put in a management role (or even employed.)

      …. Again, one story like this of a multitude, one of the other prominent ones involves an IT department manager who would only hire Romanians. To his credit his department at least functioned well, but it drove the costs of hiring up because we had to cycle through tons of qualified people before we found someone for him to interview who had the right ancestry.

      So you cooperated in his violation of the equal employment laws? Interesting.

      And HR, whether you like them or not, is usually the department standing between the employees and the employer, constantly reminding the latter that to treat the former with at least a modicum of respect is just good business sense. Not everyone is lucky like me, to work for a company where the employer actually seems to care about its employees. Most work for people who would happily throw their employees’ children into a woodchipper if it meant a .000000000000001% increase in quarterly profits.

      So you’re a free-market guy, but think company owners, CEOs, and managers are all incompetent, don’t realize a high-quality, happy workforce is a competitive advantage that can make the company succeed and grow, and only you and HR departments everywhere keep them from destroying their companies by turning them into grim, despotic labor camps?

      Well, first, companies that keep their HR departments from falling into that kind of condescending attitude by cultivating managers who are competent enough to rarely need your help – so HR is kept small and focused on helping managers – are better places to work and more productive.

      Maybe next time Tom Woods wants to talk about HR, he can talk to someone who actually works in… HR. Id recommend Liz Ryan or Peter Capelli. Both are recognized in the field, I have no idea of their political or economic leanings though I get the feeling they’re both lefties. But they’ve at least worked and published in the field, which is a massive leg up on this guest. Lazlo Bock over at Google is another person worth talking with, or Dr. John Sullivan, who writes regularly for Ere Media.

      You do realize that no one who is a careerist in the field would ever dare tell people that the Emperor of HR is naked. I think I quoted all of the people you mention somewhere in the book, and Bock in particular has done good work getting Google away from their academic, credentialist early employment prejudices to get really productive people. But none of them are going to look at HR with a critical eye and admit that most HR departments in many companies are doing as much harm as good, especially under the new atmosphere of political correctness (which I gather didn’t affect your work, but is an increasing problem in Silicon Valley.)

      I’ll leave you with some mainstream critiques made recently. I’d hope you would actually read my book and come away a little more respectful of what I’m trying to do.

      https://www.fastcompany.com/30…

      http://www.theatlantic.com/bus…

      http://fortune.com/2015/04/02/…

       

      • “And most of my sources are in engineering and technology, so the high quality of both employees and managers make HR less helpful and more culturally unlike the general staff. ”

        Do you have any actual evidence in your book as to the ‘high quality’ of these people? Do you have side by side comparisons showing them achieving better productivity and retention rates, or did you just take their word for it? Far be it from me to suggest you need to do more than talk to a few people in a couple narrow sectors who are mostly located in the most highly regulated state in the entire union that is notorious for its complex labor laws before you generalize to the entire profession.

        “In the companies I’m familiar with, new managers get guidance from their own managers and those who don’t show some decent understanding of their role do not progress further. Since you are steeped in HR, you think “training” is the answer – like any quasi-government bureaucrat, you think a program and a certain number of hours in a classroom is needed to impart the common sense and emotional skills to manage diverse people to get a job done. ”

        Your derisive attitude toward training is indicative of why your book is likely not worth reading. Again, far be it from me to suggest that simply assuming someone’s expertise in an area and not bothering to at least bolster them with some education on the matter might be a bad move. Once more, do you cite any actual evidence for the quality of the ‘guidance’ these people get, or do they instinctively know how to manage? Do they know how to break a job down into deliverables, time frames, and quality metrics, or might they need some… GASP! … training on how to do so? Do they think people can work endlessly and tend to overwork people until they burnout, or do they realize people have a breaking point and need rest? Based on what I’ve heard from silicon valley, I can guess which it is. Do any of them bother to do salary surveys before they move to hire people to ensure they’re not under or over offering? The latter being far less frequent, but it does happen. Do any of them know how to actually develop and write an actual job description so the people they’re looking to hire have a clue what they’re in for, or do they all do the typical thing of writing a description of the person they think can do the job they think they want to hire for, and then ambush them with reality after they’re hired? Do any of them have any training in any type of interviewing technique, be it behavioral or performance based, and what’s their success rate relative to what can be expected with industry best practices? Comparisons like that would be actual evidence.

        “This manager should have been fired – and in any well-managed company with smart employees, he wouldn’t have lasted five minutes. The companies I know of would have had peer managers and upper managers detecting his incompetence and he would never have been put in a management role (or even employed.)”

        Which goes to show your naivety and lack of experience in the field. Why would this manager be fired by the very people who promoted him when doing so would be a negative reflection on their own judgement? Yes, in some idealized firm that only exists as a proposed hypothetical in the mind of an academic who has never actually worked for a living, this manager would have been fired, or at least disciplined. However, in the real world hiring, promotions, and terminations are not just informed by performance, but by politics both good and bad, competence and incompetence, nepotism, and fear. IO psychologists have studied these dynamics for a long time, nepotism is a big one, especially in family owned companies, and I can assure you that the son of the boss has, quite often, damaged his father’s company with no consequences simply because of his relationship. And it’s HR more often than not that has to put a leash on that crap and who even occasionally does something horrible like suggest they hire out of the box people, and not fire people for spurious reasons irrelevant to performance.

        “So you cooperated in his violation of the equal employment laws? Interesting.”

        I guess passively yes, I just kept putting qualified people in front of him, letting his managers know about the problem, and they didn’t do anything about it because his department’s performance was okay. Eventually someone with the right background came in front of him and he hired that person, the business was in NYC and there were enough ethnic enclaves still there that eventually a Romanian came our way. What did happen, after I left that company, was that one Asian kid was transferred from the development side of IT to networking to help cover some turnover, and in short order he quit and in his exit interview apparently lambasted the manager and department. He was harassed to hell and back for various reasons including his race and demeanor, which was reserved.

        Now, here’s the problem and why ‘diversity’ might be a laudable goal to educate these guys on, because what happens when they can’t find any more Romanians? Do they just deal with massive turnover because these guys don’t know how to treat people who aren’t of their ilk? Work perpetual overtime? Import someone directly from Romania? The company can’t fire the whole damn department and lose all that training and institutional knowledge. Gee, might some… GASP!… training on how not to be a dick potentially be in order to mitigate the situation, or even solve it?

        I knew those guys, I don’t think they were deliberately being schmucks, they just all came from a very gruff, very blunt, very low emotional intelligence background. Christ, have you ever yourself worked with a ton of eastern European immigrants? Gone to a Russian restaurant and dealt with the waiters? If someone had addressed that as an issue before the managers built their own internal ethnic kingdom within the company it wouldn’t have been a problem. But no one cared until I and the HR manager at the time pointed out the problem repeatedly. To my knowledge it’s still on going though, because the department ain’t broken in terms of performance, not yet. But they are setting themselves up for a potentially massive point of failure that could be avoided if they’d force these guys to think outside their own nationality. But, wouldn’t want to let a liberal idea like diversity hurt their performance. Don’t want to hobble the managers with pesky HR requirements like not setting up a department with an obvious and glaring vulnerability, the legal risks and ramifications of which pale in comparison to the largely unseen costs, current and potential, that they’re imposing on themselves.

        “So you’re a free-market guy, but think company owners, CEOs, and managers are all incompetent, don’t realize a high-quality, happy workforce is a competitive advantage that can make the company succeed and grow, and only you and HR departments everywhere keep them from destroying their companies by turning them into grim, despotic labor camps?”

        I grade competence based on evidence, company owners and CEOs may or may not be incompetent, since we don’t operate in a free market it’s hard to nail down how much of their success is due to skill vs political acumen. However, I do not see anything in particular that assures they have any expertise in human capital management. If there was and they did, they wouldn’t fail so often on that front. Check out the reviews on Glassdoor.com of many companies, or Indeed.com. Look at their actual turnover data if you can get hold of it.

        The vast majority of businesses in this country are not silicon valley firms, large or small, worrying endlessly about diversity hires. They are small to medium sized businesses owned and run by people who have no particular qualifications in human capital management. They had a good idea for a business or a product or service and got it off the ground, that’s it. That is not evidence they have any particular skill in hiring, retaining, or managing people.

        “You do realize that no one who is a careerist in the field would ever dare tell people that the Emperor of HR is naked.”

        I have, which is why I do it anonymously. You’re not entirely wrong in your concerns, but the idea that the majority of HR people nationwide are obsessing over diversity hires and government compliance is nonsense. The vast majority of HR departments at the vast majority of companies consist of the payroll guy or girl, who handles the payroll, occasional employee complaints, and a labor lawyer who they talk to when things get serious. And where HR departments do exist in larger companies, the vast majority of people I have met and worked with are doing their best day after day to stop people from shooting themselves in the foot with their own stupidity. And the source of most of the worst behaviors is managers, and not blatant screw ups like the example I initially gave, but just people who have been promoted to their level of incompetence and are barely holding on without a clue what they’re doing, and their employers not offering any resources to help them figure it out, more often than not.

        When compliance with regulations does come up, it’s dealt with as a risk vs cost issue like anything else. One manufacturer I worked for knew of and deliberately ignored many labor regulations. They had people who should have been hourly classified as exempt so they could avoid overtime, they routinely ‘adjusted’ the punches of hourly people to avoid overtime as well. Could these people complain to the DOL? Sure. The DOL doesn’t usually do jack shit to help anyone. In my entire career I’ve seen one company successfully sued for back wages out of God know how many that were in blatant violation of the laws. One. It’s also worth noting that as free market people, however we feel about those laws, those employers did agree to abide by them when they hired their employees, so their employees are not entirely wrong or out of line to get pissed when it happens, or to try and seek redress via the only route that is practically available to them. Telling them to just get another job is an assinine response in a market where jobs are increasingly scarce, and not everyone can be a podcaster.

        Maybe I’ll read the book, but if all you really did was talk to a bunch of people in silicon valley it’s a waste of my time. I can’t believe I have to explain to a bunch of Austrian econ inclined folks that there’s a difference between what people say and what they demonstrate via their actions. Simply assuming managers are right in what they want to do is insane. Hell, in my second to last job I was recruiting for tech firms in NYC and almost every single ‘manager’ I worked with had no idea that the salaries they were offering were 50% or more below market for the positions they were looking to fill, because they hadn’t bothered to check. But hey, I’m sure they had ‘guidance’ from their managers, so they shouldn’t need actual data to rely on or anything. It’s perfectly reasonable to try and hire a C# developer with ten years of experience in NYC for 50K. Gotta trust the instincts of those managers, they know so much more than those pesky HR people who bother to look at actual data and might want them to occasionally hire someone who isn’t a carbon copy of themselves.

        Jeb Kinnison

        • Fools and knaves lurk everywhere, I suppose, but your experiences don’t match what most of my sources say about companies today. Otherwise why would Deloitte be suggesting an end to annual performance reviews, to be replaced by more-constant manager feedback and a reliance on direct managers, with some coaching from “concierge” consultants, to determine raise and promotions? Their studies point to management-by-HR as a source of one-size-fits-all schemes that managers have to game anyway. It’s true that less well-managed companies end up with bad low- and mid-level managers, with your style of HR serving as a bandaid to prevent disaster. But I can’t help noticing how close your position is to the usual defender of progressive government, who believes that average citizen is too stupid and unenlightened to decide any important matter for themselves. An enlightened class of trained bureaucrats can regulate them into being better citizens…

          Your comments are valuable as one view from a long career, but most big employers today have big HR depts. doing things like requiring regular diversity and sexual harassment training by timed web browser, forcing productive and already-completely-aware people to jump through the same hoops over and over again, a degrading and timewasting experience for the 95% who don’t need it and provably useless on the 5% who do.

          I do hope you read the book, where I suspect you will agree with a lot of it. Just like staffers of a government bureaucracy, you see all the good work you appear to do but can’t see how things might be done differently, so you feel attacked and are outraged. No one is saying your work was pointless or that all HR is useless or unneeded. This book is supposed to counter the vast quantities of pro-HR, pro-Progressive propaganda put out by the HR industry. The revolution is coming…

           


The book is currently available in: trade paperback from Amazon, Barnes and Noble, and other bookselling web sites; Kindle ebook format from Amazon exclusively; and as an audiobook from Audible and Amazon.

Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[Death by HR: How Affirmative Action Cripples Organizations, in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat…. It is time to turn the tide against this madness and Death by HR is an important research tool…  All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.


More reading:

A Clinton Christmas Carol
“High Tech Under Diversity Pressure
Ban the Box, Credit Scores, Current Salaries: The Road to Hiring Blind
HireVue, Video Interviews, and AI Job Searches
“Death by HR” – Diversity Programs Don’t Work

The Tom Woods Show, Episode 817: “Death by HR”

[Death by HR: How Affirmative Action Cripples Organizations]

The Tom Woods podcast on Death by HR is here, and on Youtube here. We ran overtime a bit, but aside from editing out some lapses and timechecks, they ran almost all of our discussion.

I invented a new term, “reverse regulatory capture,” to describe how HR culture has generally come to accept the attitudes of the progressive regulators and labor lawyers toward much of their work. One of my editors told me when I used “Stockholm Syndrome” to describe the phenomenon that many readers would not understand what that term meant — here’s an explanation. Often used when talking about Patty Hearst, the heiress kidnapped by the Symbionese Liberation Army in 1974 who adopted the revolutionary name Tania and participated in bank robberies with them. Responding to someone who holds power over you by first pretending to adopt their values to avoid punishments, and eventually coming to truly believe them. HR has complied with government enforcement so long that its thinkers and educational programs have adopted the progressive values of the regulators.

I took his introductory comments as a blurb for the book:

“Interesting, cutting, incisive book about what’s really going on in HR departments in companies across the country.” — Tom Woods, senior fellow of the Mises Institute and host of The Tom Woods Show


The book is currently available in: trade paperback from Amazon, Barnes and Noble, and other bookselling web sites; Kindle ebook format from Amazon exclusively; and as an audiobook from Audible and Amazon.

Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[Death by HR: How Affirmative Action Cripples Organizations, in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat…. It is time to turn the tide against this madness and Death by HR is an important research tool…  All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.


More reading:

A Clinton Christmas Carol
“High Tech Under Diversity Pressure
Ban the Box, Credit Scores, Current Salaries: The Road to Hiring Blind
HireVue, Video Interviews, and AI Job Searches
“Death by HR” – Diversity Programs Don’t Work

Death by HR: Audio Introduction

Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[Death by HR: How Affirmative Action Cripples Organizations,]

The Tom Woods podcast will be doing a segment on Death by HR tomorrow, and when they send me the link I’ll put it up here so my readers can listen. I wasn’t familiar with his extensive writings or his career, but it’s impressive as seen in his Wikipedia entry. His current web site is here, and his podcast show is popular — old episodes are here. He’s closely associated with Peter Schiff and has him on frequently as a guest, and he recently started the Contra Krugman podcast — which uses the New York Times columnist Paul Krugman’s partisan writings on economics and current affairs as a foil to discuss more realistic economic ideas.

I enjoyed our discussion and was gratified that he supports the book. I did a practice segment a few days ago that turned out well enough that I’m posting it as a good short introduction to me as the author and the ideas in the book. Tom’s interview segment will be 15 minutes or so, and directed to a few areas of interest, so the focus is different — there’s not too much overlap.

So enjoy and pass on the audio of Jeb Kinnison introducing “Death by HR.”


The book is currently available in: trade paperback from Amazon, Barnes and Noble, and other bookselling web sites; Kindle ebook format from Amazon exclusively; and as an audiobook from Audible and Amazon.

Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[Death by HR: How Affirmative Action Cripples Organizations, in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat…. It is time to turn the tide against this madness and Death by HR is an important research tool…  All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.


More reading:

A Clinton Christmas Carol
“High Tech Under Diversity Pressure
Ban the Box, Credit Scores, Current Salaries: The Road to Hiring Blind
HireVue, Video Interviews, and AI Job Searches
“Death by HR” – Diversity Programs Don’t Work

“Death by HR” Released as Audiobook

Death by HR Audiobook Cover

“Death by HR” Audiobook Cover

After much work with narrator Joe Farinacci (who did such a good job with Avoidant) the Amazon/Audible audiobook of Death by HR is finally for sale at these links:

Amazon
Audible

Accountability, Equality, and Partial Fairness

Seal of the Handicapper General - Harrison Bergeron

Seal of the Handicapper General – Harrison Bergeron

One of the bigger problems with the ACA or any health insurance system which outlaws medical rating is its removal of the financial consequences of bad health habits. Progressives believe heavy taxes on cigarettes will reduce smoking and thereby reduce lung cancer and early death; a financial penalty on a self-destructive habit justified by the social welfare state’s future payment of medical expenses. (One issue is whether this is even true — it turns out most actuarial calculations show those who die early as a result of lung cancer have less spent on their medical care in old age and forego social security payments, so they save the welfare state money.)

But if you equalize the cost of medical insurance regardless of health habits, you are reducing the consequences of unhealthy habits and thus encouraging them. Accountability — having to be responsible for one’s actions — suffers under equalizing systems. Drivers with many accidents and drunk-driving convictions on their record will pay much more for (and find it difficult to even obtain) car insurance, and that’s normally considered a Good Thing because we want there to be financial penalties for habits that endanger others, like driving recklessly or under the influence.

The reasonable objection to charging for health insurance based on health record is that health status is only partly controlled by previous habits and behavior; a big chunk is genetics and chance. So it seems unfair to those who are sick because of bad luck in the genetic lottery — or even by accident, as cancers, for example, are thought in some cases to be created by accidental mutations, and only some cancers are caused by avoidable environmental exposures like smoking.

And many children begin life behind the eight-ball, having inherited problematic genes that make them more likely to suffer from conditions that cost a great deal to treat. Should insurance companies be able to use the results of genetic tests to offer low-cost policies to some, and much higher-cost policies to the unlucky?

In a laissez-faire world, insurance is an adversarial game with customers trying to hide any damaging information from the insurer as the policy is being sought, and the insurer doing their best to deny claims afterward. As a result, governments set up insurance commissions and regulators since it was impractical to adjudicate disputes over every consumer’s insurance policy in an expensive court of law. Arbitration and insurance commissions have done a fairly good job in the past of managing this conflict of interest, with some states being more pro-consumer than others.

One partial workaround for the medical rating problems is the idea of “continuous coverage.” The initial risk pool is assumed equal, and anyone who keeps paying for coverage continuously is allowed to stay in that average-risk category because some small part of their earlier premiums is true insurance — covering the risk that a health issue will turn up which makes them a bad risk in the future. Insurance contracts typically cover one year, and so if there is no requirement to continue coverage beyond that contract, rates could adjust upward or renewal could be denied based on negative events that happened during that year. Requiring renewal at the same rate as the rest of the risk pool makes the contract insurance against the long-term costs of treating any illness acquired during the period, not just that year’s costs.

What happens to people who allow their insurance coverage to lapse because they can’t afford the premiums or simply forget to pay? Most states had a high-risk pool with required must-issue, but rates were very high (of course — since the people seeking insurance under it were far more likely to need expensive care in the short term.) Some hybrids, like exclusions for pre-existing conditions for six months or a year, helped get people coverage at in-between prices.

The PPACA (“Obamacare”) tried to eliminate the problem with must-issue (no one could be refused insurance) combined with narrow time windows for seeking coverage and penalties for going uninsured. These were intended to force everyone to get insurance and to keep them paying for their insurance even if they were being charged much more than they were likely to receive in benefits. Younger, healthy people were expected to pay more to cover the costs of older, sicker people. In practice this did not work — even the subsidized rates were too high to get healthy young people to join up, and the penalties of going without insurance were small compared to the inflated new prices for insurance. So individual insurance coverage pools shrank and were dominated by new customers needing a lot of expensive, deferred care, and rates rose further as doctor networks were narrowed and more healthy people stopped paying.

The Supreme Court’s ruling deeming the ACA constitutional was only partial — the attempt to force states to increase Medicaid enrollments was deemed unconstitutional, so many states did not expand Medicaid. This left a bizarre hole in coverage in those states where a person could make too much to get Medicaid coverage, but too little to get private insurance subsidized through the exchanges. And the expansion greatly increased Medicaid enrollments in those states that participated, accounting for nearly all of the decrease in the uninsured in the US, but Medicaid itself has never been shown to improve medical outcomes or decrease mortality, and many people complained that they were forced to join Medicaid when they would have preferred to buy private insurance.

Also, the Supreme Court’s swing voter on the case, Chief Justice John Roberts, specifically warned that the fine for not having approved insurance was only constitutional if it was viewed as a tax, and an increase to the fine to an amount sufficient to force compliance would make it unconstitutional. This cuts off the ACA proponents’ attempt to raise fines to try to force more enrollment.

Which brings us to the subject of this essay — how do we decide what is fair when consequences of simple bad luck and genetics are mixed with the downside of behavior under a person’s control? Suppose a well-off person (let’s say the son from a wealthy family who left him a trust fund) drinks, smokes, and plays video games all day throughout his life. In his 40s now, he’s obese and unhealthy, with emphysema and cardiac problems imminent. Should his expensive future healthcare be subsidized by middle-class families who have worked hard, exercised, and been careful to avoid bad habits? That is the way ACA policies are now set up. Even unsubsidized, policies for wealthy people in poor health are much cheaper under the ACA than they would be in a free market, and those who have restrained their appetites and sacrificed to maintain their health better pay more than they otherwise would to make up for those costs.

But there’s no easy way to separate those “bad unhealthy” people whose illness is due to their own choices from those “deserving unhealthy” people who are ill because of chance or genetic inheritance.

The ACA plan tried to compel more equality of premiums regardless of actual risk or likely use of medical services, which removed some of the incentive for healthier behavior and burdened those who made the effort and sacrifice to keep themselves healthy. This tried to protect those who were simply unlucky, but many of those people are worse off than they were under previous high risk pool plans provided by the states, and have had their care disrupted or cut off by the high prices and narrow networks.

Every complex system is adaptive, and human systems especially so, with people quite capable of understanding the rules and seeking out every loophole to their advantage. The ACA has failed because people aren’t easily herded by programs designed by committees, and by finding the loopholes (paying for one month and using it for three, staying off until actually ill then signing up under the many loopholes in enrollment windows to get expensive care then dropping out again), the people have ensured the ACA cannot be sustained in its current form.

The ACA, which was promoted as saving everyone money, has ended up being much more costly for most than the old system. It has helped a few, but cost far more tax and premium dollars to help those few than a direct subsidy to the existing high-risk pools would have. The redistributionists have again discovered that unintended consequences will make nonsense of their social engineering schemes.

Philosopher John Rawls is usually cited by progressives intent on redistribution; his thought experiment suggested we view a system as just if we would choose it willingly, not knowing in advance what advantages or disadvantages we would be born with. You can argue that much behavior is also dictated by fate — our example of the obese videogamer may well have been doomed by being born into his particular family with parents who could not guide him toward a better way of living. But under that view, no one is responsible for anything, and we know that people can change to overcome even the worst background and genetic inheritance. Removing rewards for modifying one’s behavior toward the socially-valuable means a society which is less civilized and poorer in every way.

The classic Vonnegut story “Harrison Bergeron” takes equality to the extreme. The government has decreed that all must have equal abilities and outcomes, and so those who are more intelligent or talented are handicapped to bring them down to average. Of course, this becomes a nightmare with tragic outcomes as society grinds to a totalitarian halt.

But suppose we already have a little bit of this deadening effect introduced by the government’s emphasis on hiring by ethnicity or sex rather than ability. Would we even realize that the but-for world where only merit is considered would be wealthier, happier, and more fulfilling for most if not all people? If one has never seen a ballet performed to perfection by the most talented dancers on Earth, would we notice that the dancers are being dragged down by lead weights they have been forced to carry — or selected for political reasons rather than talent — making their performance less satisfying?

Socialists and redistributionists tend to think diversity and choice and product improvement are not as important as providing the poorest an equal quantity of goods, and the central planners of the USSR counted quantities of production, not quality; the stories of great quantities of useless, poor-quality, ugly products available from state stores while people schemed and bribed to get better-quality goods from abroad show how central planners failed to understand what mattered to the people. Even Bernie Sanders, who should know better, suggested there was too much choice in deodorant and shoes, and restricting choice would somehow allow more poor people to be fed, clearly missing a lesson or two of the socialist past.

So if you had never seen a perfect ballet or operatic performance, you might not notice how the ones you have seen have been compromised for the sake of political goals. Similarly, if you’ve never seen a world of free enterprise without identitarian politics or Party corruption, you will never realize how much freer and more productive your society might have been. The US overcame a history of race and sex discrimination to more closely approach the standard of merit alone — then has been backsliding incrementally as race- and sex-conscious employment policies took hold. While it appears the US is now limiting progressive overreach by not electing Hillary Clinton president, there has been a lot of damage already, with government agencies especially dysfunctional. It will take a lot of work battling entrenched special interests to reverse the educational system’s failure to teach children civics, history, and economics.


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


For more reading goodness:

Materialism vs Purposeful Life: Trump, Bannon, and Teilhard de Chardin
Sekrit Reform Agenda: Untangling Government: Medical Deregulation
No More Elections or Campaigns: Liquid Democracy
“Death by HR” – High Tech Threatened by Social Justice Activists

Seal of the Handicapper General - Harrison Bergeron

Seal of the Handicapper General – Harrison Bergeron

Followup: Materialism vs Purposeful Life

Crony Capitalism - Prager U

Crony Capitalism – Prager U

Thanks to Instapundit for the link to yesterday’s post, Materialism vs Purposeful Life: Trump, Bannon, and Teilhard de Chardin. I want to expand on some parts and add some new links for completeness.

First, “Lie Swarms,” which discusses how the atomization of media has created copied and mutated lies which swarm the victim from so many directions that the repetition establishes truth for many news consumers:

Spengler said that the attacks on Bannon are an example of the Big Lie. I take issue with that. What we are seeing with Bannon, and have seen and are seeing with Trump, is something different: it is the Lie Swarm.

The Big Lie is an effective propaganda tactic in a centralized, vertical media system dominated by a small number–and in totalitarian systems, basically one–of information channels. Radio or television with a small number of national stations either directly controlled by the state, or subject to substantial state pressure (e.g., the US in the days of the Fairness Doctrine). To oversimplify only a little: one message, one medium.

In the modern fractured information environment, with a proliferation of outlets and social media that allows free access to millions, coordinating on a single message is far more difficult in such a diffuse and fragmented system. But this technology is perfectly suited for unleashing a swarm of half-truths and lies that forms what can best be described as an emergent order. It is not consciously designed by anyone, but without central coordination design it does exhibit order and synergistic behaviors.

One swarm tactic that is becoming increasingly common is Six Degrees of Hitler/Putin/The KKK/etc. Target A has some connection to B who has some connection to C who has a connection with D who said something that could be interpreted as being vaguely fascist . . . so Hitler!

In some respects, it is harder to fight the Lie Swarm than it is the Big Lie in a society where there the media is not rigidly controlled. A single lie can be rebutted if the target of the lie has the ability to make the case and the access to enough eyeballs and ears to do so. It is almost impossible to swat every lie in the swarm, especially since the lies change and mutate from day to day, and since whenever you are in a position of rebutting a lie you tend to draw attention to it. But unrebutted lies are often as treated as facts, so if you don’t kill them all some damage is done.

Bannon, and especially Trump, are primary targets of the Lie Swarm, especially since Trump had the temerity to actually prevail in the election. Don’t get me wrong–there is much about Trump to criticize. But there has been a kind of Gresham’s Law at work here: the bad criticism has driven out the good. Screeching “racist!” “Anti-Semite!” “Fascist!” on the basis of the most twisted and biased interpretation of the flimsiest evidence has overwhelmed substantive argument.

And the Swarm really hasn’t figured out that their attack will do little to get Trump supporters to change their minds. If anything, it will do the opposite, because the “deplorables” know that they are being attacked and smeared as much as Bannon and Trump. Furthermore, the Swarm seems hell-bent on living out Einstein’s definition of insanity: doing the same thing over and over, and expecting different results. Hillary’s whole campaign was based on personal attacks on Trump and his supporters, and she enlisted the Swarm in this endeavor.

And it backfired stupendously. Why should they expect that doubling down on it will work any better?

Behind-the-scenes coordination a la Journolist isn’t even required. The clickbait factories read each other’s output and copy the talking points almost immediately, so a Huff Post article is usually just a simplified and more hysterical version of Daily Beast, which in turn comes from a WaPo writer. See the hype progression on today’s news:

WaPo: Trump picks Sessions for attorney general, Pompeo for CIA. Sen. Jeff Sessions is known for his hard-line views on immigration.

Daily Beast: Donald Trump Puts the White Back in White House, Taps Jeff Sessions For Attorney General. With Jeff Sessions, Mike Flynn, and Steve Bannon, Trump’s early picks suggest he’s doubling down on his ugliest instincts.

HuffPo: DARK AGE A.G. – Civil Rights Groups Condemn Sessions… An ‘Extreme Anti-Immigrant’ Voice… Will ‘Erase 50 Years Of Progress’… Warren: Senate Has ‘Moral’ Obligation To Nix Nomination… FLASHBACK: Too Racist To Be a Judge… Said The Only Issue With KKK Is Their Drug Use… Suggested White Lawyer With Black Clients Was A Race Traitor… Denounced Civil Rights Groups: ‘Un-American’…

We’ve always had yellow journalism, but the clickbait farms are influencing the mainstream sites, making them compete to be more alarmist.


More thoughts on the forms of capitalism and the two forms Steve Bannon decried at the 2014 conference:

But there’s a strand of capitalism today — two strands of it, that are very disturbing.

One is state-sponsored capitalism. And that’s the capitalism you see in China and Russia. I believe it’s what Holy Father [Pope Francis] has seen for most of his life in places like Argentina, where you have this kind of crony capitalism of people that are involved with these military powers-that-be in the government, and it forms a brutal form of capitalism that is really about creating wealth and creating value for a very small subset of people. And it doesn’t spread the tremendous value creation throughout broader distribution patterns that were seen really in the 20th century.

The second form of capitalism that I feel is almost as disturbing, is what I call the Ayn Rand or the Objectivist School of libertarian capitalism. And, look, I’m a big believer in a lot of libertarianism. I have many many friends that’s a very big part of the conservative movement — whether it’s the UKIP movement in England, it’s many of the underpinnings of the populist movement in Europe, and particularly in the United States.

However, that form of capitalism is quite different when you really look at it to what I call the “enlightened capitalism” of the Judeo-Christian West. It is a capitalism that really looks to make people commodities, and to objectify people, and to use them almost — as many of the precepts of Marx — and that is a form of capitalism, particularly to a younger generation [that] they’re really finding quite attractive. And if they don’t see another alternative, it’s going to be an alternative that they gravitate to under this kind of rubric of “personal freedom.”

He correctly calls out crony capitalism, and the fascist capitalism you see in China and Russia to a great extent today, where enterprise is heavily controlled by the state and the corrupt entanglements enrich the connected in both state and enterprise. There’s way too much of that in Obama’s America as well.

His mention of Ayn Rand and Objectivism is interesting. Ms. Rand’s followers have tended to the cultish, with a romantic emphasis that is anachronistic sixty years after she wrote her seminal works. While explicitly atheist, Rand replaced the element of religious purpose with the aggrandizement of the creative individual. As Bannon says, in a time of collectivist thought-police expropriating the fruits of labor and denying any individual credit for achievement (“You didn’t build that,”) her creed can be very attractive to the young rebelling against stifling conformity.

What’s left out of Ayn Rand’s heroic vision is room for the personal altruism of the family and friendship. She railed against mindless altruism and self-sacrifice, but that was aimed at those who glorify sacrifice to the state and abstract others like “public opinion.” She had built her heroes without dependents or those boring long-term attachments that aren’t glamorous or transgressive, so the real underlying motivation for most people, making a better life for not only themselves but their children, family, and friends, was left out. Attachments would have spoiled her superhuman heroes and heroines, and her villains were often relatives — social-climbing wives, clingy brothers and the like.

Libertarian-ish thinking today has evolved to include more nuance and understanding of economics, game theory, and evolutionary psychology. While there is a definite “drive to create” that motivates many artists and business founders, the more important drives are for status (for the esteem of others and attracting better mates) and the obvious fulfillment of basic needs for food, shelter, and security for oneself and attached others.

Capitalism works best conducted in a neutral setting with a predictable legal backing. It is also dependent on trust — the willingness to put some money or effort out despite the risk that the supplier you are contracting with will stiff you or turn in shoddy work. You trust initially because your commitment is small and you’ve checked out the reputation of the supplier, and you trust more later after completing numerous satisfactory transactions with that supplier. You share your good experience with others despite the fact your supplier may gain new customers and raise prices or have less capacity to do your work, because you are also building a reputation and credit for being a good cooperator. This trust is what really makes capitalism efficient and more capable of producing what is satisfactory for others than any other system.

So community on small and large scales is necessary to success. This isn’t “You didn’t build that,” which is intended to imply that government supplied you with the environment critical to your success; the legal system, the roads, the communications nets, and your network of suppliers all use the framework of law and government in the background, but it was the private elements that created the trust and incentives to produce. Law and government are necessary as backstops, but not sufficient, and no one who is productive owes the proceeds of their success to government. Taxes to pay for government need to be neutral, too: extracted as much as possible in proportion to services demanded, kept as low as possible to provide those critical services.

The Pope’s view of capitalism is colored by his Argentinian background; Argentina has been in the grips of crony capitalist-fascist demagogues for decades. But the notion that values are critical to capitalist functioning is reasonable; no business does well to neglect the health and security of its customers and employees, and individual transactions are about more than money and goods exchanged.

Materialism forgets about the human background, and its various flavors are damaging in different ways. Communism purports to replace the profit element and private ownership with central planning and state ownership, which destroys the incentives that make society run. Democratic socialism similarly reduces the rewards of effort and transfers to strangers the fruit of one’s effort, which weakens the strength of community bonds as the state replaces voluntary association. These flawed ideas are based on redistribution of material goods as if they were far more important than human relationships of cooperation and reliance which are critical to happiness and productivity.

Ayn Rand’s ideal society has never been tried, for the obvious reason that human beings are almost never like her characters. It is probably best to view her work as intended to counter the collectivist central planners of her youth in the USSR and later in America; she emulated the romantic socialist propaganda but to promote individualism, which was denigrated at the time. Her vision lacked the bonds between people that make them more than homo economicus, the model of man as cold calculator of transactional benefit.

So Bannon has a point here, even if he oversimplifies the views of today’s libertarian thinkers. Some overarching purpose to life and work is required to make an economy grow, and the Obama era’s stifling correctness and overregulation has been sapping the will to open new businesses and to invest in new employees. Vanquishing religious thought damages the motivation of those who rely on it, and some of the other streams of purpose — emphasis on competition and production — have been deprecated in favor of inclusion and identity politics in staffing (see my book Death by HR below.)


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


For more reading goodness:

Materialism vs Purposeful Life: Trump, Bannon, and Teilhard de Chardin
Sekrit Reform Agenda: Untangling Government: Medical Deregulation
No More Elections or Campaigns: Liquid Democracy
“Death by HR” – High Tech Threatened by Social Justice Activists

Crony Capitalism - Prager U

Crony Capitalism – Prager U

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