Creating Jobs

I recently read an excerpt from an interview Forbes did of a guy named Jim Clifton, CEO of Gallup. I pulled it from a weekly letter I get from an economist named John Mauldin. I liked some of the points he made and thought I'd pass them along.

Jim Clifton, CEO of Gallup

When asked the question, "What obstacles do leaders have when trying to create more jobs?", he responded,

There are no real obstacles. Just wrong thinking, bad assumptions. When you build strategies and policies on wrong assumptions, the more you execute, the worse you make everything, which is what we are doing now. There are three wrong assumptions that cause all the current job creation attempts to not work.

1. Innovation is not scarce. Entrepreneurship is scarce. We are spending billions and wasting years of conversations on innovation and it isn't paying off. Great business people are more valuable and rarer than great ideas.

2. America has about six million active businesses. Ninety-nine percent of them are small businesses. An incalculably huge mistake leaders are making now is spending time, money, strategies, and especially policies for those who need 'help' getting a job. A useful way to look at any citizen is this, 'Can she herself create jobs or does she need a job created for her?' We are spending all our time on the cart and doing little or nothing on the horse. We have our assumptions and futurism that backward. 'The horse (small and medium business) stopped, so we fix the cart (jobs).' If we change all our strategies and policies to favor the job creators (small and medium businesses) the horse and cart will get moving again. We have our compassion right, but the logic is staggeringly stupid.

3. It is wrong thinking to imagine that Washington has solutions. Job creation is a city problem. There is great variation in job creation by city in the United States. San Francisco and the greater Valley keep pumping away while Detroit isn't. Austin's cart works while Albany's doesn't. Cities need to look inwardly and say, 'What can I do to create great economy energy, to bring new customers for all existing companies and start-ups?'

I think Jim may not have formulated his answer (most likely delivered verbally) as elegantly as he might have, but I think his points are mostly valid. I admit part of the reason I liked the quote is because his 'staggeringly stupid' comment made me laugh out loud. But I agree that we get our logic backward a lot of times. Fostering job growth has to include encouraging the producers of jobs, which are historically small and medium businesses according to my friend John Mauldin. Mauldin's writings over the years have led me to believe that most large businesses don't create a lot of growth or innovation. There are exceptions. But I'd like to see more encouragement for people to start their own businesses and create economic value rather than seeking jobs from large businesses, hoping that someone will drive the economic growth necessary to create and continually validate the existence of that job.

I think he's probably right about where the solutions should originate. At the local level, people and governments can have a much greater impact. It seems logical to me that many of the solutions should come at the local and possibly state level. I want to see everyone have a job that keeps them meaningfully employed, but I don't think the Federal government is going to solve that problem. I don't believe they can.

Though there are valuable policies that governments can implement that can encourage economic growth, it may be that one of the best things they can do is to stop weighing down the horse. Unfortunately, just how that should be done is not something I can answer very intelligently.

Emotion vs. Logic

My son shared with me a frustration on Saturday and his argument was irrational. We were at a scouting activity and he was being excluded because other non-scouts had taken all the available slots. When I asked him what was wrong, he told me that people who weren't scouts shouldn't be allowed to participate. I tried to reason with him by telling him it was a family activity and if they didn't allow siblings to participate, families wouldn't want to come. He became more frustrated ... go figure.

Then I realized he was trying to share a feeling with me and the only words he could find were couched in something that didn't make sense ... and he knew it didn't make sense. But it was all he could find to share with me his angst because he felt excluded from the activity.

Feelings often don't seem to be rationally based or, if they are, we can't always find a rational way to explain them. We're too busy feeling them. But we need to share them with each other in order to bond and sometimes in order to deal with the emotions and let them go.

I often forget this in practice, but I think it's so important, when someone is sharing a feeling, particularly a negative one, to just listen. Refrain from giving advice. Refrain from passing judgment. Don't try to use logic. Just listen, empathize, try to enter into their emotion, recast it in your own words to make sure you understand what they're feeling, and let them talk it out.

Women seem to be much more emotional than men on average and I've had to learn this idea with my wife to keep our marriage healthy and happy. Unfortunately, I'm a very logical, left-brain kind of guy and I still mess up a lot .. but I'm getting better.

The Power of Leaders ... or Lack Thereof

Our society, and maybe all societies, tends to give too much blame/credit to our leaders. We blame/bless the President when the economy is bad/good. Really, he's just one among many that sets policies that affect the economy. That contribution can't be a large percentage of the total impact of fiscal and monetary policy. Appointed officials such as Fed governors have more influence on the economy than the President, but even they probably get more blame/praise than they deserve.

Tolstoy's 'War and Peace' gives some great arguments in favor of decentralizing the blame and praise. He also makes a pretty good case that in some ways, the guys with boots on the ground have a lot more to do with the success of an endeavor than the guys sitting behind the desk. One of his characters, Andrei Bolkonsky, consciously chooses a path that puts him on the field of battle rather than serving as an aide to the General because he believes he will have a much greater impact on the war in that capacity. I think Tolstoy goes a little too far with that idea, but it's a healthy counter to the ubiquitous concept that the leader is the one making everything happen.

Prince Andrei Bolkonsky

A CEO stepping into a company, for example, often finds his/her hands tied by the momentum of various projects, a corporate culture that may stubbornly refuse to change, or constraints imposed on him/her by predecessors that the new boss is powerless to change.

Leaders are people just like you and me. Their influence may be greater than the average guy on the street, but let's not overestimate their power. And let's not underestimate our own power either. Each of us can be an enormous force for good in this world. We just have to have a vision of what we want and work with firmness of mind to bring that vision to reality.

The Art of Unlearning

I've been studying neuroscience recently and I believe one of the foundational aspects of how our brain works is its ability to establish correlations. At a very basic level, one of the ways we learn seems to be the establishment of a connection between two or more objects, attributes, events, ideas, etc. Biologically, the synapses, or connections between neurons, are strengthened or weakened based on several mechanisms. The neuroscience community calls this elastic phenomenon 'synaptic plasticity' and it is believed to be an important mechanism by which we learn.

Pavlov's dogs are a good example of this phenomenon. Through repeated experiences, they learned that there was a correlation between the ringing of a bell and feeding time. In their minds, they correlated these two events over time such that one event (the ringing of the bell) would trigger physiological reactions (e.g. salivation) that indicated they expected the second event.

This seems to be why we often require repeated exposure to ideas in order to learn them. The synaptic plasticity doesn't occur with a single exposure to two ideas; it evolves over time as those experiences are repeated. Learning by repetition works really well for my kids and I think that's pretty universal.

So I got to thinking about the idea of 'unlearning' and I think it's a bit harder to do than learning. If learning is, at least in part, fundamentally the establishment of correlations, then one way to unlearn something is to break correlations, but that's not exactly a straightforward thing to do.

Suppose I have been building correlations all my life that connect a certain habit to various stimuli. Let's say I like to smoke. Every time I smoke a cigarette, I'm experiencing new visual, auditory, and olfactory stimuli. These stimuli can become correlated in my brain with the stimuli associated with smoking. Over time, a certain image, sound, or smell or even the thought of one of those stimuli can trigger the thought of smoking. If I have made it a habit, then my brain tends to reinforce the action with random sensory inputs that are correlated with the experience of smoking.

In the case of nicotine and other drugs, they actually modulate certain neuro-chemical processes in the brain by blocking or enhancing the reception of neurotransmitters, which makes them even more addictive than an ordinary, less brain-invasive habit. But the concept is the same. Habits and thought patterns can be triggered by association with other ideas and sensory inputs to the brain. Breaking a habit or unlearning a correlation is a lot harder than creating a habit or establishing a correlation.

Instead of associating ideas, to unlearn something, we have to disassociate them, which requires breaking correlations that have been embedded in the mind. I've found many times that I've had to unlearn things I had come to believe as a child or a young man. Some associations were formulated at school, some at home, and some who knows where. I imagine most people face this at one time or another.

I'm not sure I have a good formula for unlearning, but just as correlations are built with repeated associations, perhaps we can decorrelate ideas by thinking about one of the ideas and actively suppressing the other idea. If we repeatedly expose ourselves to cases where one idea is present and the other is suppressed, perhaps the brain will respond by weakening synaptic connections that were previously strengthened and over time, we won't automatically think of the second idea when presented with the first.

This seems like a really important skill to learn. Some people seem to become more closed-minded as they age leaving an unmalleable mind in a 70 year old. Keeping our minds open and flexible requires regular exercise, which requires the humility to admit that we'll always have a lot to learn. I think we also have to find joy in the learning process and be willing to undertake the effort to unlearn ideas we previously cherished when we find them incompatible with truth. In the words of the great Yoda, "[we] must unlearn what [we] have learned."

Dorian Gray and Earnest

I recently read The Picture of Dorian Gray by Oscar Wilde - sad story, but interesting idea based on a Victorian concept that evil actions make themselves known in the physical appearance of the person who commits them. There is some truth to this, but it can also be a dangerous philosophy by which we make faulty judgments of people.

I'm not sure I'd recommend the book. It's clever and interesting, but a bit pessimistic. And I'm not sure I like the morals that seem to be naturally drawn from the story.

A while ago, I read another of Oscar Wilde's books called 'The Importance of Being Earnest'. That book is witty and delightful. I also enjoyed the movie adaptation with Colin Firth. A quick read, funny, witty, satirical - I highly recommend that one. It makes for an enjoyable few hours.

Skellig

We went to the library last night and a book caught my eye in the childrens' section. I started reading it, checked it out, and finished it last night. It's called Skellig by David Almond.

It's a beautiful book about life, healing, love, friendship, and it struck me as a book of poetry that happened to be associated with a story. It was an easy read, but it was so beautiful, I decided to learn a little more about David Almond and William Blake, a poet that Almond quotes several times in the book.

Blake was a fascinating man and I think I'd better read some of his works. And I'm really fascinated by Almond and think I'd better search out some more of his stuff in the library. That book was in the childrens' section, but that only makes sense to me as a short work of fiction. It's a book of poetry, philosophy, and beauty and as an adult, it appealed to me strongly. Now I'm off in search of more beauty from Mr. Almond.

It's strange to find a contemporary author I enjoy, but I think this book has a quality that could turn it into a classic that endures after Almond is gone.

The Emotions of Politics

I almost titled this post 'The Insanity of Politics', but I realized it's really about emotions. It isn't really insane; it's just ... well, ok, maybe it is.

My wife told me of a semi-celebrity who posted a supportive comment of Mitt Romney on her fan page the other day and, while there were some supportive comments, the feedback quickly degenerated into a childish fight. People expressed support for Obama, then for Mitt, then for Ron Paul, and then they started throwing insults at each other. There were some attempts to calm the rhetoric, but it was mostly silly.

I don't know exactly why people get so charged up about politics, but I think it's an unfortunate commentary on human nature. I see that kind of discussion going on and I just sigh; I laugh silently at the circus; and I long for some semblance of sanity to return to public discourse. That may be wishful thinking, but I do occasionally hear rational discussions in the public sector.

I actually think all three of those guys the fans talked about are pretty decent. I strongly disagree philosophically with a couple of them and I'm sure they're all far from perfect, but at the same time, I see good in all of them. But for some of the supporters of any one of them, all other candidates appear to be demons.

My approach in times of campaigning is typically to stay away from the news completely. I'll check out headlines and occasionally read a story, but I often feel disgusted after that and I go back to my old ways.

Another trick I've tried off and on is to turn on the talking heads and mute them. Try it sometime. It's pretty amusing and very therapeutic. I can't do it for more than a few minutes or I get bored, but it's a nice little diversion.

Religious discussions sometimes devolve into the same kind of childish spat. Maybe that's why religion and politics have become taboo in certain social settings. It's just too easy to make people mad. Which is a shame because both topics are pretty important and well worth discussing. I don't bring them up at work very often, for example, though I try to live my life such that people can see my philosophy in both domains shine through my actions.

When I find people who can keep a level head while talking about those topics that strike so close to the heart, I really enjoy sharing my ideas and hearing theirs. But I think rational debate requires us to adopt the mindset that we're not out to prove our point, but rather to share with one another in an attempt to jointly arrive at a better understanding. This philosophy of debate seems rare. Maybe that's what I find so sad. Maybe our public debate is a reflection of the arrogance that seems so inherent in human nature.