Recently several people have expressed frustration, within hearing range, over infuriating actions of large companies. For example, Apple's practice of generating excessive hype for unremarkable hardware by applying a spot of polish and a kiloton of marketing. Aggressive lawsuits and patent trolling are another instance. Attacks on the reputability of excellent sources of journalism are a third.
The corporation is a paradox. Unlike the human beings that own and work for it, the corporate entity can be physically massive and far-reaching, to the point of incomprehensibility. We are hard-pressed to even picture Toyota's 300,000 employees, or the 9 million cars it sells annually. Conversely, while the behaviour of their employees and investors as individuals is complex, corporate 'behaviour' is very simply-motivated.
In fact, it is not reductio ad absurdum to say that nearly all business ventures have a single purpose: to generate a return on investment. This is an ineluctable truth, their raison d'être.
With this in mind, we see that it is unreasonable to treat corporate behaviour as if it were human behaviour. "Singly-motivated" humans are frequently described as insane. Likewise, it is unreasonable to describe corporate behaviour using the human qualities of hypocrisy, audacity, justice, honesty, fairness, consistency, etc.
On the other hand, lower life forms, which respond predictably to changes in their environment, are a good model. If I say that ivy will put roots in weak mortar, unable to know that such action will cause the wall on which it lives to collapse, you can begin to see my meaning.
Bacterial colonies can be made to commit suicide by consuming all the food in a closed container. Similarly, when the return on investment is demanded quickly, the corporation can be expected shoot itself in the foot by generating short-term profit and ignoring (or actively denying) the possibility of long-term repercussions.
There are, of course, attempts to quantify the human impact of corporate activities. In such discussions you hear the terms goodwill, corporate social responsibility, ethical consumerism, and so on. But at root these are ways of assigning monetary value to efforts to limit profit-reducing public backlash against corporate actions which are seen as 'evil'. In nature, small creatures will avoid the unwanted attention of predators and competitors.
Applying this sort of analysis doesn't reduce the human damage often caused by corporate actors, but it certainly renders most instances unsurprising. The comparison works best for larger companies, in which the actions of the whole are most divorced from any good intent of the many individual employees. It also explains why we tend to see fewer 'inhumane' behaviours from non-profit organizations and charities. Freed of the overriding imperative to generate returns, these entities can adopt decision-making structures that tend to increase other outcomes.
Finally, to my mind, the analogy clarifies the issue of public versus private provision of government services. To shoehorn the positive societal impacts we expect from certain government programs into the measure of profit or return on investment is often inappropriate. Even where it is, private service providers can only be expected to yield the desired outcome if the direction of increased return is carefully aligned with more positive societal impact. On the other hand, as outlined above, the same providers can be expected to find all new ways of generating returns which do not necessarily correspond to any societal improvement—bursting like so many blades of grass through cracks in the figurative pavement.
I have almost finished reading the brilliant book Beyond Growth by the economist Herman Daly. It is worth quoting at length:
We have three economic problems to consider: allocation, distribution and scale.
Allocation refers to the apportioning of resources among alternative product uses—food, bicycles, cars, medical care. An allocation is efficient if it corresponds to effective demand, that is, the relative preferences of the citizens as weighted by their relative incomes, both taken as given. An inefficient allocation will use resources to produce a number of things that people will not buy, and will fail to produce other things that people would buy if only they could find them. It would be characterized by shortages of the latter and surpluses of the former.
Distribution refers to the apportioning of goods produced (and the resources they embody) among different people (as opposed to different commodities). Distributions are just or unjust; allocations are efficient or inefficient. There is an efficient allocation for each distribution of income.
Scale refers to the physical size of the economy relative to the ecosystem. The economy is viewed, in its physical dimensions, as a subsystem of the larger ecosystem. Scale is measured as population times per capita resource use—in other words total resource use—the volume of the matter/energy throughput (metabolic flow) by which the ecosystem sustains the economic subsystem. Scale may be sustainable or unsustainable. An efficient allocation does not imply a just distribution. Neither an efficient allocation or a just distribution, nor both, implies a sustainable scale.
The three concepts are quite distinct, although relations among them exist, as noted above.
(I had planned to write on this topic, but instead put a gift card towards this purchase—a lucky choice, in hindsight. Usually I am happier to read on new topics than to share my clumsy initial thoughts. Experience is starting to show this is a good habit.)
Daly points out that economics and the problem of scale cannot escape elementary thermodynamics. Human economic activity takes low-entropy matter & energy as input and produces high-entropy wastes. The ecosystem has a limited ability to convert the latter to the former. He also hints that the scale of the economy is unsustainable, or will soon be at current rates of growth. There are also a number of elegantly simple diagrams I will surely reproduce and reuse.
The very clear explanations lend weight to a number of incubating personal beliefs:
These considerations motivate major changes, but of course they don't mean that we must choose to be unhealthy, uncomfortable, hungry or unhappy.
More (hopefully) soon.
Public policy is a growing personal interest, building on my background in engineering, my morbid fixation with local, provincial and federal politics, and a view for leadership.
This term I have a fascinating graduate course in Engineering & Public Policy at the University of Toronto. While much of the material would likely cause the reader's eyes to glaze over, I hope to write about some situations that motivate the use of policy.
My mother grew up in what was essentially farmland in Aurora, Ontario in the 1950s and '60s. School always involved a long bus ride; the nearest neighbours were miles away. Her love of the outdoors led our family to own a ski chalet on 8 acres of land in upstate New York in the '90s, and for decades she has enjoyed an annual, week-long canoe trip with several women her age to one of Ontario's many parks. The works of the Group of Seven are among her favourite art.
I, on the other hand, have resolved never to own a car, which mostly confines my working life to urban areas. I am still interested in living in a Japanese-style one-bedroom apartment, the sort that tend to be too small for even a shower (a nearby bathhouse substitutes). Bicycle activism interests me, and recently I use 'driver' as an ephithet more often that not. Despite these contrasts I find that I share a high valuation of nature, of open spaces away from civilization, of the pristine. I cycle, ski, run and dragon boat because I love being outdoors. Nature's majesty has an unrivalled capacity to awe me.
Whereas earlier generations, especially in North America, had a concept of nature as bountiful and boundless, we are aware today of the limits of our planet. Conventional wisdom has it that a person is entitled to his own homestead, his plot of land, or at least his suburban home on a large lot. When space is plentiful, this is excellent—if each child had his own patch of woods to tromp through, we would surely have better mental health overall.
In Mississauga, where I grew up, there is no longer empty land; every hectare within the city limits has been zoned, and much of it for housing. The consequence is sprawl; youth who feel disconnected from communities they cannot traverse without a license and a vehicle; poor public transit in areas with density too low to support frequent service. Development, far from ceasing, continues in Brampton and other municipalities further from downtown Toronto.
I don't think this should be interpreted to mean that we no longer value nature. Imagery of the Great White North is central to our national identity and we are loath to abandon it. Nor are the developers and new homeowners inherently evil. Instead, I feel, our behaviour has been slow to change and no longer suits our values.
The course has confirmed my distaste for the varieties of conservatism that favour small government and markets. In the Greater Toronto Area, the de facto policy of letting the housing market alone has only allowed the efficient paving of large areas of green land. Yet the market provides no incentive to use instruments of collective benefit (parks, transit and multiple dwellings) over those of individual benefit (backyards, cars and individual homes). Thus the need for progressive policy. Looking to Western Europe and East Asia we can see myriad examples of both success and failure in this policy space, and we have the luxury of adapting the former to our own cities.
Thus also I can reconcile my 'city mouse' predilections with my 'country mouse' values. When wilderness and nature—the urban park, the lakeshore, the ski slopes and national parks a few hours away—are within easy reach, urban living need not feel confined or artificial.
The first of three short pieces for today deals with the concept of Tax Freedom Day, which divides the working calendar year in the same proportion as the income tax paid by the average taxpayer (around 40%, in Ontario). Promoted in Canada by the conservative Fraser Institute, it is also highlighted by the Canadian Taxpayers Federation (CTF) with words such as:
Another, albeit more depressing, way to view our tax burden is through the lens of a typical day...after working all morning for Paul Martin, Ernie Eves and Mel Lastman (or substitute your own mayor), it’s time for a quick sandwich and then back to work to make money to pay the bills. This scenario represents the daily grind for the average Ontario taxpayer.
The CTF has at its core the vaguely insulting reduction of 'citizen' to 'taxpayer', which both ignores civic duty and elides the crucial fact that the set of citizens and set of taxpayers are not the same. From the CTF's standpoint, children—not being, for the most part, taxpayers—are only of value to the extent that they earn tax breaks for their parents, and certainly their education (paid for by taxes) is assigned no objective value that might distinguish it from other "waste".
Regarding Tax Freedom Day itself, the key fault is evident in the quotation above, which supposes the money is solely lining the pockets of elected officials. While those do earn salaries—about which I will express no opinion—a more honest report would acknowledge that a taxpaying citizen's days until mid-June are spent:
Of course, the hope is that you will imagine yourself to be a serf working for a greedy landlord who allows you but a fraction of your meagre income. When this is successful, the citizen comes to believe he is only a taxpayer, becomes blind to the benefits of government and therefore howls for it to be demolished.