Posts tagged " Joseph Schumpeter "

Tent on the Beach

February 26th, 2019 Posted by Thought Tools 10 comments

Lately I’ve been listening to the rhetoric of ambitious politicians both in the United States and Europe.  They tend to speak of business in very negative terms usually with adjectives like greedy, selfish, and unfair.  They blame corporations for everything from inequality to poverty and from depression to crime.  They preach that the institution of business is inherently flawed.

Business, like politics, education and the press is run by people who sometimes do illegal and immoral things. But an additional complaint against businesses is the notion of competitiveness. Implementing new ideas in itself is evil, they claim, as it results in the closing of less creative enterprises.

It is true that business does depend upon constant innovation as things change.  The man making, selling or repairing fax machines in the 1980s had to adapt to email and cell technology at the turn of the century.

Former finance minister of Austria and mid-20th century Harvard economist Joseph Schumpeter said that business depends upon creative destruction.  Humans’ constant march forward to ever-newer ways of doing things is not a lamentable side effect of commerce but is an essential element of wealth creation. 

Prior to his death, Moses addressed each of the twelve tribes of ancient Israel. 

And to Zevulun he said, Rejoice Zevulun in your going out,
and Yissachar, in your tents.
(Deuteronomy 33:18)

What does this verse have to do with Schumpeter?

The attentive student of ancient Jewish wisdom hears in this account, a faint echo of an earlier event.  Prior to his death, Jacob also delivered a prophetic address; this one to his twelve sons after whom the tribes were later named. 

Zevulun shall dwell on the sea shore and
he shall be a haven for ships.
(Genesis 49:13)

Ancient Jewish wisdom reminds us that, tourism being a fairly recent manifestation of affluence, shipping and sea travel always mean commerce in Torah nomenclature.  Until recently, the only reason for travel was for business.  This Genesis verse is telling us that Jacob foresees his son Zevulun representing the business professional for all time.

Now back to Deuteronomy:  “Rejoice in your going out…” 

The phrase “Going out” means that Moses is advising the business professional, Zevulun, to always be in a perpetual state of exiting his current comfort zone.  What a perfect description of a successful business professional!

However, if your only formula for success is constantly to shatter the boundary fences, you are surely being guided directly to the office of your friendly state prosecutor and/or to bankruptcy.  Simply breaking boundaries is no roadmap to successful living.

Moses very carefully added a vital phrase to the advice he gave Zevulun, the business professional.  He didn’t just say, “Rejoice in your going out.” He added, “and Yissachar in your tents.”

These are the only two brothers or tribes treated together in one verse in Deuteronomy 33.  In ancient Jewish tradition, “tent” implies, not a primitive dwelling, but rather an entire framework of moral and philosophical coordinates. 

Yissachar is regarded as the tribe whose function it is to serve as a repository for Torah knowledge.  ( I Chronicles 12:32)  Now we can see that Moses instructed Zevulun to maintain a close connection with the entire framework of morality and emphasis on human relationships by keeping close to Yissachar’s tent. 

Only by clinging tenaciously to the unchangeable fundamentals does one gain the freedom safely to break down boundaries and innovate profitably.  Among the Torah’s many unchangeable fundamentals about business are these three:  Business is about satisfying other people; neither eyeballs nor tax benefits can replace real profit; and all transactions should be transparent and honest.

Business success does depend upon constant adaptation to constant change. It just as surely also depends on unchanging commitment to timeless truths and everlasting values.  Perhaps one reason that ambitious politicians despise business is that citizens who either own a profitable business or work for one are more independent and have little need for government hand-outs and favors.  Not surprisingly, ambitious politicians resent that which makes the their stock in trade less necessary.

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