Wednesday, May 24, 2006


Direct Deposit Considered Harmful Part 2

For just a moment, I want to return to the curiosity mentioned last time: a manager goes out of his way to hand-deliver paycheck envelopes to the employees. Because the money has already been direct deposited, there are no paychecks in the envelopes. Hierarchy seems absent while the employee accepts the gift of the hardcopy receipt of the direct deposit.

Managers and employees are not the only ones who participate in this kind of suspension of hierarchy. Chimpanzees do this when they share a feast. Food sharing encourages reciprocal exchanges with unrelated junior chimps and the action testifies to the moral character of the sharer. Status is not achieved by a position on an org chart. A direct deposit removes an opportunity for this exercise. It seems to squander an opportunity to acknowledge a reciprocal relationship between a boss and an employee.

Think of a person who gave you a gift when you were growing up. Do you still have an unusually strong fondness for that person? In elementary school, my friends and I mailed letters to Gale Sayers, Brooks Robinson, Johnny Bench and Magic Johnson. There was nothing more exciting than getting an autographed photo back in the mail. I'll never forget how we thought the players who were charging money for autographs were the biggest jerks. All these years later, those who sent us autographs will always be my favorite.

Here's a few observations:
  1. Sharing, with one type of exception, does not exist down a hierarchy

    For instance, an employee generally does not think to ask his boss for a ride to the airport. However, unused perishable items are shared: tickets to a sporting event, obsolete computer equipment, the deli tray left over from the managers' meeting. In a similar way, airlines allow customers to make use of unused seats by earning frequent flyer miles. All of these acts are perks that tend to build goodwill and loyalty and it costs the sharer nothing. It seems odd that, after all these years, my cell phone company has never offered to reward me with more minutes. They must squander billions of unused minutes. The Creative Commons initiative seems to address this blindspot in copyright laws which assume that every work is like Mickey Mouse and has an infinite commercial life. If managers played like the phone companies and copyright lobbyists, employees would never get to snack off the deli tray.

  2. Payments to subordinates in a hierarchy are opaque and for undefined work

    When payments are made outside of a hierarchy, they are often transparent. For instance, businesses advertise their prices on the market, anyone can find out how much a house sold for, etc. However, when it comes to salaries, this information is generally hidden. Furthermore, outside of a hierarchy, it is clear to the supplier or seller what he is providing. Within a hierarchy, an employee has a job description but that can change at any time.
If hierarchies are not conducive to sharing, where does sharing happen?

Gift exchanges happen within a community. Communities exist when there are gift exchanges. The Creative Commons is a community. So is the scientific community, the open source community and even bloggers. As Bernard Lietaer notes in The Future of Money, communities are destroyed when their gift exchanges are replaced by nonreciprocal currencies, like national currencies. An interesting example is that Japan continues a special tradition of gift exchange. Lietaer:
Gifts are constantly exchanged not only within the extended family, but between co-workers, esteemed individuals, social and work superiors and elders. It takes often the form of sharing one's talents in art, calligraphy, culture or other social graces...
A quick look at the Statistical Abstract shows that Japan stands alone among industrialized countries in measures like percentage of children raised by two parents, etc.

Turn back the clock 30,000 years ago. When woolly mammoths were hunted with dart throwers, there was too much meat for the hunter(s) to eat, so the mammoth was shared. This was a risky business and it makes sense to wait it out and let somebody else do the work. However, the status acquired due to the success of the kill and the sharing with others seems to be the incentive. An interesting idea is that in a high risk venture such as this, acquiring status is a good hedge when your hunting party doesn't get anything.

Matt Ridley briefly notes in The Origins of Virtue: Human Instincts and the Evolution of Cooperation that Glynn Isaac proposed that food sharing occupied a central place in human evolution.

It's getting late, so I'll have to finish up later. This is leading somewhere!

It seems to me that part of the point of the corporate paradigm is to destroy community. Humans are a naturally communal animal and our success as a species has been our ability to harness that very quality on increasingly grander scales. The point of community is to organize the tribe for its mutual and overall benefit whereas the point of corporatism is to organize workers to benefit an abstract entity and one which may even be harmful to the community. While some reciprocity is necessary, corporatism (particularly of the stock market variety) requires diminishing benefits to workers over time while increasing productivity in order to generate ever larger profits. One's value to the entity is determined not on output but on the available labor pool. Thus, reciprocity is eroded and the original purpose of commerce (to support the tribe) is inverted. The tribe now exists only to support commerce, hence the concept of "excess population."
Post a Comment

<< Home

This page is powered by Blogger. Isn't yours?