Capitalism's Greatest Trick

First published on

[ this is a draft ]

Capitalism's greatest trick has been to give companies legal rights, thereby channeling very strong human instincts towards economic prosperity.

Part 1 - Survival instinct is extremely powerful

There are human forces that drive our behavior. These have been shaped by basic evolutionary measures. Here are two, but there are more.
  • All humans have an evolutionary developed need for survival. Survival instinct is real and a very strong force. People under existential threats will do amazing things to survive.
  • Some humans have a competitive desire to conquer, to wage war and take resources of others. The competitive desires results in higher chances of passing on genes, but is less strong than Survival Instinct.
In most of human history, these forces have focussed on basic human needs for survival and gene reproduction: owning food, land, power, sexual relations.

Part 2 - Humans act as groups 

As humanity progressed, humans have collaborated and acted as groups. Humans strongly identify with the groups they belong to, sometimes exchanging their own values and needs for those of the group. People have fought wars for their countries, religions, etc.

Part 3 - Companies are legally people

In modern western law, there is the concept of a Legal Person. A Legal Person is something that has the rights that humans have. This includes companies. Companies have rights and obligations and employees are in a sense merely agents acting on behalf of the company.

Unlike most giant organizations (countries, religions), most companies are short-lived. It is trivial and socially acceptable to start a company, to join or leave one.

Capitalism gave companies super powers

Extending basic rights to companies is the greatest trick that capitalism has ever pulled off. It gave companies legal rights independently of the rights of the humans that are working for it. Now companies can be born, can grow or can die just like humans. Thanks to humans acting as part of their group, this mechanism allows humans to channel their evolutionary instincts without hurting other human beings.

This has two consequences:
  • Companies that have a competitive drive can result in the death of other companies, but not of human lives.
  • Companies that come under existential threats will find extremely creative ways to survive.
I believe that giving these very strong human instincts to companies while separating the consequences from human suffering has been the key differentiator for our capitalist economy.

Think about this the next time your company talks about crushing the competition. is under serious threat, I bet you can feel the survival instinct kicking in.



Disclaimer: I am not a biologist or economist.

Comments

Post a Comment

Popular posts from this blog

"Security Is Our Top Priority" is BS

First published on
A couple of years ago I was asked to give a conference talk about software security. Well, actually I wasn't really asked, my company bought a sponsorship package with a speaker slot and I replied to the internal email asking for volunteers  🤣  Anyway, while preparing my talk, I realized a couple of important points about security that have not left my mind since: Security is limitless . You can always spend more effort to make things more secure. The same goes for quality, safety, employee happiness, etc. The needs of security are opposed to the needs of a convenient user experience . Improving one typically hurts the other. Now some organizations say "Security is our #1 priority". Really? You want to make something that has no limits your number one priority? I mean security is a good thing, but this seems a bit too simple? In fact, hollow marketing claims like that can make me a bit angry. In this post I'll help you understand what to make of statements like that...
Read more

AI programming tools should be added to the Joel Test

First published on
Here's a wake-up call to all CTOs: AI programming tools are getting freaking amazing and if you don't allow your teams to use them somehow, it will bite you in the ass in a couple of years. You will be slower and you will lose your best people. The infamous Joel Test is a list from the year 2000 of 12 things all great software companies do. Since then most companies have implemented Git and CI/CD, checking of three items, so we have some space left in the 2024 update ;) I believe "Do you allow your developers to use AI assisted development environments?" is a necessary addition. I get that you don't want your source code to end up on some OpenAI / Microsoft / Github server somewhere, sure, but find a way to use your own models or learn to live with it. Note that this is often not the same as "#9 - Do you use the best tools money can buy?" as blocking AI tools is about data security, not money. So why do I think developers need AI programming tools? I...
Read more

The long long tail of AI applications

First published on
Image
Last year multiple companies asked me for advice. " We are evaluating this AI powered product, but do you think it makes sense at all? It seems a bit niche and we think ChatGPT might make this entire thing obsolete soon. " Long tail - credit to Wikipedia My answer so far has always been: "No, bare LLMs are not going to compete with this product." I think that people are failing to understand the distinction between different classes of AI companies. I see it like this: Foundational AI - creating models like GPT-4 (text), Sora (video) etc. Applied AI - using existing models to create smart applications. Note that there are also companies not focusing on AI - they will start lagging behind, let's forget about them ;) There are orders of magnitude  (!)   more companies that will deal with Applied AI than Foundational AI, and they will be very busy for decades to come. Here's why: To get the most out of LLMs, you have to ask the right questions. LLMs have acc...
Read more