Question of the Week:
Why does it seem like SO MANY business owners and multi-millionaires have a warped idea of the way capitalism and economics works?
Example: Warren Buffet comes across very much as a socialist in the way he talks about the earned income credit. In an interview with the CEO of Alibaba he spoke about the way he thinks there will be less of a need for people to work as the world experiences a great technological boom.
Why is this? Do they not need to have a good understanding of capitalism in order to be able to employ so many people and run their companies efficiently?
David H.
Dear David,
You mention the Sage of Omaha, Warren Buffett. One might add Bill Gates of Microsoft, Jeff Bezos of Amazon, Elon Musk of Paypal and Tesla, and perhaps Mark Zuckerberg of Facebook. These and a few others are outliers on the edge of the universe. For them the stars all lined up; first, they are all people of extraordinary talent and drive. Second, against all odds, for them the timing, their family and their connections, ideas, capital market conditions and the zeitgeist were all in place. Their lack of spiritual understanding and wisdom made no difference such was the strength of the current that swept them along. However, for the millions of entrepreneurs, small businesses owners, and career builders, for the rest of us ordinary folks, our chances of success are greatly enhanced by possessing both information and wisdom.
We’re sure you’ve heard of the Pareto Principle, named for a 19th century Italian economist. It is sometimes called the 80-20 rule. For instance, it is typical for 80% of a sales professional’s commission to come from 20% of his customers. Similarly, a chef with only 80% of possible training might achieve success.
It is possible to succeed in business up to a certain level without knowing much more than how to follow recipes just as a lower-level chef might do quite well even without adding the final step that makes him a culinary artist. To achieve one’s fullest potential one needs not just information and knowledge but also wisdom.
What I mean by this is that for many years, perhaps since the early 1970s, we’ve been living in what is usually described as the “Age of Information”. This means that data is available to anyone, anytime, from almost anywhere on any topic. Ancient Jewish wisdom celebrates the availability of information and its value but promotes wisdom as an indispensable adjunct to information. As the English novelist C. P. Snow wrote back in the 1960s, in The Two Cultures and the Scientific Revolution, information tends to exist in silos. Physicists discuss forces and natural phenomena from railway locomotives to atoms and know close to nothing about Shakespeare, while poets know English literature but know almost nothing about the 2nd law of thermodynamics. Our world tends to be run by information people. For example, Anthony Fauci possibly knows some information about public health, but he certainly knows very little about economics and the psychological consequences of loneliness and financial stress. Information tends to be about gathering data and organizing it within disciplines while wisdom is about integrating information and achieving harmony. Information builds many tall towers in which one can ride up and down in elevators. Wisdom allows us to move between the data towers. One reason the CEO gets the big bucks is because he listens to advice from his legal people, his marketing people, his finance and accounting people, his human resources people and his manufacturing and logistics people and then he arrives at a lonely decision with which few of his advisors will necessarily agree. For a virus specialist confronting a pandemic, a shut-down makes all the sense in the world. An economist, a psychologist, and a national security specialist might all give different advice. Information leads to specialization; wisdom leads to integration.
Part of wisdom, in fact its foundation, is knowledge of God. The beginning of wisdom is fear of the Lord, and knowledge of the Holy One is understanding. (Prov 9:10) Without that and restricted to a materialistic view of reality, most of us cannot achieve anywhere close to our full potential. What is more, ignorance of God and of spiritual reality makes it all but inevitable that one will be attracted to socialism as an economic system. This is a longer topic than suits this venue but in brief, without God and His moral system, men are drawn to the simplistic moral model in which equality is the ultimate value. Naturally this opens the door wide to manipulative and ambitious politicians who self-servingly stimulate resentments and jealousies.
So, as you say, there are certain financially successful people who are drawn to the fallacious morality of secular fundamentalism. Currently, some of them are easily misled by being in thrall to technical information. Thus, they announce how robots will soon make work obsolete, and how people will need to colonize Mars and how men will eventually seek solace from robots not women. They may not be very wise, and they may be laughably inept as futurists but they don’t make many mistakes as they build their business colossuses.
Most of us, however, live more normal lives where we each enjoy certain advantages and corresponding drawbacks. We work on ourselves and we try to increase both our reservoirs of information and our wisdom.
Onwards and upwards,
Rabbi Daniel and Susan Lapin
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