Sunday, December 2, 2012

Are You Fragile or Antifragile?

It's Sunday, a time when I contemplate my miniscule place in the universe. It's also a time when I surf the various news feeds. I seek tidbits of enlightening wisdom. Okay, so that's a paradox when it comes to scanning the news media. But, in fact, if I'm fortunate and don't sit on any one channel too long, I almost always uncover some hidden treasure. Normally, I have total disdain for channel surfers, but I must admit that the remote control is the only way I make my discoveries. I typically move between the Fox News Channel, CNN, CNN's Headline News, MSNBC and CNBC. When the broadcast network programs are on (usually weekend mornings before the overload of sports that I totally opt out of) I include those in the mix.

I'm bored to death by all the typical political banter over Benghazi, Ambassador Rice's possible nomination as Secretary of State and the fiscal cliff. Then add the ongoing wailings of those unfortunate souls of natural disasters, currently, super storm Sandy and probably, upcoming, those flooded out and without power on the west coast by their barrage of storms. Somehow all of them believe it is everyone else's responsibility to restore their lifestyles. Add to these the way over extended war in Afghanistan, the Middle East crises (never just one) and the European economic crisis. And don't get me started on the celebrity stories. Well, I'm sure you know what I'm talking about. It's pure information overload and always bad news and gloom and doom.

Please, don't make the assumption that I don't care. The reality is that I CAN'T care. It's too much burden to bear, especially since I can't change it, fix it or make it all go away. What I can do is to do my very best to not become a burden on anyone else, on society or on the world. I have no interest in becoming a martyr or a ward of society. I've paid my dues and continue to do my best to remain a productive member of the universe taking up the smallest footprint possible and providing a positive impact on anyone I come in contact with.

The Little Treasures

So, those little treasures I find are bits of information I can hopefully put to work in a positive way for myself and anyone I'm in contact with. The story that has gone viral about the young NYC police officer who bought a pair of boots with his own money for a homeless man who was barefoot. That's a treasure and makes me think about things I can do to help others. The story told by the young Marine sergeant about how the Toys for Tots program began 65 years ago and to date has provided over 500,000,000 toys to needy children at Christmas (yes, I proudly say Christmas - not Holiday Celebration). But, today's most intellectually inspiring treasure was an interview with Nassim Nicholas Taleb, author of a new book titled Antifragile: Things That Gain From Disorder.

So, why did this interview impact and inspire me? It inspired me because, in essence, he affirmed many of my belief systems about the world, society and my own country, the United States. In part, he indicates how the U.S. as a country and society has transitioned from being antifragile when it was in it's formative and fledgling years to being a fragile society with only a few pockets of antifragility left. He uses this antifragile concept to illustrate why the U.S. and other countries, societies, corporations and individuals are destined to lose or fail and not recover.

Gloom and Doom!

Okay, so here's my personal gloom and doom prediction. I know this is an unpopular position and I'm likely to be flamed by many who take the time to read this, but it's what I believe and unless you can prove my supposition to be wrong, unequivocally, I'm sticking with my story. You can believe what you want. Like the people who were told to evacuate from the path of the recent storms, who said nothing like this has ever happened before, so I'm staying here. Some of them may have changed their belief systems after the storms. It's too bad they had to learn the hard way that sometimes your belief systems can not only be challenged, but proven wrong.

I believe that we're going to have an ongoing employment crisis, not only in the U.S. but in the world. I believe that we are the authors of this problem. I believe those who listen to the government talking heads are being sold snake oil. Those who tell everyone that they can stimulate and create new jobs, know in their heart of hearts they are effusing a huge line of baloney. However, the truth and the facts are that the efforts of those in government are in maintaining a complacent populace and retaining their seats of power. In other words, they maintain their positions of power and control by telling the populace exactly what they want hear, not the real facts and what they need to hear.

Okay, I know I'm in for it now. I guess I'm anti-American for making such a statement. But, I'm also antifragile. Antifragile according to Taleb means I'm prepared for a volatile set of circumstances. I'm willing to take risks and deal with failures, get up, brush myself off and try again. This is the attitude and the position that people had when this country was founded. There were no government bail-outs for those companies "too big to fail." There was no government stimulus. There were no safety nets like Medicaid, Welfare, SSI or even military disability. And guess what? As a society, we not only survived, but in, probably the shortest time in all recorded history, we became the wealthiest, most successful and powerful nation in the world. It was because, as a people, we did what we had to. Life was volatile. There were no guarantees. People failed. People died. People learned from the failures and deaths and became stronger.

The Big Transition

Again, at risk of being flamed, we have transitioned. We were a nation of pioneers, innovators, inventors, risk takers, hard workers and doers. Today, we've become a nation of whiners, security seekers, entitlement welfare recipients, complainers, blamers, finger pointers and so on.

What happened? It's really very simple. The easier we made it for everyone the less incentive there was. The more expectation of a guaranteed and secure life everyone should have, the greedier and more materialistic everyone became. And, of course, now it's popular to point the finger at the "rich" people and the big corporations as the cause of it all. And, to be perfectly honest, some of the rich people and their greed and the huge mega corporations do hold some responsibility for this mess we're in, but far from all the responsibility.

Unions - A Dying Breed

Another news story today was about a union attempting to unionize the McDonald's fast food chain. They want the employees to make a living wage of nearly double what they are currently paid. Here's the problem with that. First, the work that most McDonald's employees do isn't worth more then the amount they are currently paid. Second, McDonalds jobs are not designed as long term careers, so the majority of the employees will never gain any of the benefits of what the union will promise, but, as seems to be the case, never actually deliver. Third, the prices of McDonalds products will have to increase substantially to pay the employees, thus putting the price of McDonald's food out of the range of more of the buying public sending customers to competitors. That will ultimately make McDonalds less profitable and requiring them to increase the cost of their franchises and franchise fees making them less desirable as a business opportunity resulting in less McDonalds stores. Then the union will attempt to unionize the competitors who will fight back with a vengeance so as not to suffer the same fate.

And, here's the kicker. The union will have a healthy slice deducted from every McDonalds employee's paycheck for which, in the long run, the employees will gain little or no benefit since these jobs are basically transitional. Who wins? The union. Who loses? The employees, McDonald's and the consumers. The unions, while once a very necessary entity to bring some realistic balance to the workplace have also transitioned to a top down, fragile entity that makes their members more dependent on the union and the government. I know! I've been there.

Remember the auto industry? The unions ran the union wages and benefits up for jobs that weren't worth the pay and benefits and the employees became complacent, so the price of cars rose and the quality suffered. The foreign manufacturers took a huge bite out of the market, built their own plants in the U.S. with non-union labor and today there are only about 390,000 union auto workers compared to 1.5 million workers in 1979. So, the population of the U.S. increased from slightly more than 225 million to about 312 million today or an increase of just under 40% while the union membership declined by nearly 75% during the same period. This is one indicator of why my original supposition will hold true. Private sector unions now represent only about 7% of the workforce down from an all time high of 35% of the workforce. That's an 80% decrease from the 1950s peak.

Some Real Facts!

Here are some facts. Population is increasing exponentially. In 1928 the world population was two billion people. Eighty-four years later the world population is around seven billion. That's an increase of 350%. In 1928 the U.S. population was 120.5 million. Today it's approximately 312 million. That's an increase of 260%. There are simply too many people. Read my most popular post, Too Many People, if you haven't already.

Add this to the list of facts. Radio was in its infancy. Television did not exist. The Internet hadn't been conceived of. Telephone communication was primitive and expensive. Computers didn't exist. Automated robots didn't exist, let alone replace humans in manufacturing. The list of technologies that have literally replaced human labor is almost endless since 1928. The many social and entitlement programs that have weakened individual resolve didn't exist. Most work was done by hand.

Entire industries have ceased to exist and many, including agriculture, formerly a large employer, have become so efficient they can function with only a very small percentage of the human resources formerly required. Women have entered the workforce in unprecedented numbers adding even more people where less are required to do the job. Even our military can function at a more awesome degree of destructive power with far fewer personnel. Our mortally wounded casualty count is unbelievably reduced, bringing back even more people to a workforce that no longer has a demand for all the human workers. The U.S. has nearly doubled the number of bachelor degree graduates in about 30 years, yet, somewhere between 63% and 74% of the current graduating classes can't find jobs.  And just as a comparison, India, with a population of approximately 1.1 billion people has more four year college graduates then the entire population of the U.S. and they are all looking for career opportunities.

So, we have more people and the population of both the U.S. and the world continue to increase exponentially. We have more technology then anyone could have ever imagined even 50 or 60 years ago. The technology is increasing at even a faster pace then the population and does work that once required humans and even more dramatically, it's doing work that never existed before. Currently, in any typical month there are less new jobs available than there are new additions to the workforce. And the jobs that are becoming available are not high paying jobs. So, just where are all these jobs going to come from that the government talking heads keep indicating they are going to create?

Gloom and Doom! Gloom and Doom! This is what Mr. Taleb conveys in his book, Antifragile. He points out the difference between a bottom up structure and a top down structure. The U.S. has transitioned from a bottom up structure where the individuals were the risk takers and, in essence "owned" and controlled the government as compared to the current status where the individual is risk averse, seeks security, expects the government to provide that security and, thus, it's now the government in control and the individual is, more or less "owned" (a more emphatic word then simply controlled) by the government.

Fragile or Antifragile?

Who are the antifragile people? They are the entrepreneurs, the innovators, the inventors, free spirits and risk-takers who create new ideas, technology, businesses and some personal wealth for themselves. They are much like those who were the foundation of this country. The only difference is that as a percentage of the total population, today they are only a tiny percentage. Additionally, the government and the top down structure in this country has made it more difficult by several magnitudes for these individuals to function. Yet, the occasional Bill Gates, Steve Jobs, Michael Dell, Meg Whitman, Steven Spielberg and others in a few other industries and the Silicon Valley types still emerge. The giants like IBM, HP, the Big Three auto manufacturers and such have had to automate and cut back employment in order to continue to exist. IBM is no longer in the personal computer business because it couldn't remain competitive. Industries like typewriters, vinyl record pressing and others have joined the buggy whip industry. If they exist any longer, they have become nothing more then cottage industries.

So, are you Fragile or Antifragile? The fragile are those who still believe they are going to find that dream, high salary job (and a few - as in a small percentage of the total number seeking the same thing) will find that job. But, they are becoming fewer and farther between. The antifragile are those who can muster up the risk taking, take control of their own lives, buckle down, stop chasing unrealistic dreams, create their own opportunities and become the innovators, creators, inventors, free thinkers and entrepreneurs of the 21st Century. It is these antifragile people who will realize and achieve their realistic dreams, live a comfortable lifestyle, however they define it, and survive.

But, be assured, the government created jobs will be just that, government jobs, either by direct employment or by contract. Where will the money come from to support these government created jobs? Why, from the pockets of those fortunate enough to work in the private sector or from the antifragile entrepreneurs. Oh yeah! And let's not forget by the government continuing to borrow from other countries until their money runs out or the U.S. is too big a credit risk, just as has happened to other nations over the past several decades. A debt that will never be repaid.

I've stated my beliefs. If you comment, that means you care about this reality. If you don't, you obviously have your head in the sand or just don't care. If you flame me, that's fine. I'm sure you have some good points and I'd just ask that you include some facts to back up your position. But, I wouldn't trust anything that politicians or bureaucrats, at any level, say because we're in the situation we're in right now because of them and they are promising more of the same. 

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