It’s been suggested that we’ve moved to a postfactual society, where evidence and truth no longer matter, and lies have equal status to the clarity of evidence. So how can we rebuild respect for truth and evidence into our liberal democracies? It has to begin with education, but it has to start with the recognition that there are huge gaps.

This comes at about 10:50 into this TED talk by Alexander Betts, on Brexit. I recommend this one for anybody reading this, especially Americans. What he says about realities of class division and globalization applies equally to this country.  He offers fascinating data from the U.K. Applying it here, in the U.S. as well, is obvious.

He also offers a set of recommendations on what we do about it. A difficult path to follow, but a whole lot better than just cursing what is.

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With passion and wry humor, the former Dean of Freshmen at Stanford makes the case for parents to stop defining their children’s success via grades and test scores. Instead, she says, they should focus on providing the oldest idea of all: unconditional love.

She’s very concerned in this talk with the other side of the coin – not neglectful, uncaring parenting, but parenting that focuses on visible trappings of kid success:

But at the other end of the spectrum, there’s a lot of harm going on there as well, where parents feel a kid can’t be successful unless the parent is protecting and preventing at every turn and hovering over every happening, and micromanaging every moment, and steering their kid towards some small subset of colleges and careers.

And this:

What I’m saying is, when we treat grades and scores and accolades and awards as the purpose … What I’m saying is, our kids need us to be a little less obsessed with grades and scores and a whole lot more interested in childhood providing a foundation for their success built on things like love and chores.

She has a lot to say about defining kids and childhood beyond the kind of achievements that lead to admission to the best college. She has a good argument for including chores in childhood. And a serious plea for unconditional love instead of conditional success.

All of which makes me pleased with my post yesterday, about raising kids to be entrepreneurs. I suggested in that post that you don’t push too hard, live your own life instead of theirs, and let them study what they want, not what you want. Among other things.

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Have you wondered why politicians are not what they used to be? It’s not because their DNA has degenerated. It is rather because one can be in government today and not in power, because power has migrated from the political to the economic sphere.

The audience laughs at the DNA joke, but then falls silent. The speaker, Yanis Varoufakis, who was Greece’s finance minister during last year’s Greek financial crisis, has a very serious point.

Over the last three months, in the United States, in Britain and in the Eurozone, we have invested, collectively, 3.4 trillion dollars on all the wealth-producing goods — things like industrial plants, machinery, office blocks, schools, roads, railways, machinery, and so on and so forth. $3.4 trillion sounds like a lot of money until you compare it to the $5.1 trillion that has been slushing around in the same countries, in our financial institutions, doing absolutely nothing during the same period except inflating stock exchanges and bidding up house prices.

So a mountain of debt and a mountain of idle cash form twin peaks, failing to cancel each other out through the normal operation of the markets. The result is stagnant wages, more than a quarter of 25- to 54-year-olds in America, in Japan and in Europe out of work. And consequently, low aggregate demand, which in a never-ending cycle, reinforces the pessimism of the investors, who, fearing low demand, reproduce it by not investing.

the economic sphere has been colonizing and cannibalizing the political sphere to such an extent that it is undermining itself, causing economic crisis. Corporate power is increasing, political goods are devaluing, inequality is rising, aggregate demand is falling and CEOs of corporations are too scared to invest the cash of their corporations.

So the more capitalism succeeds in taking the demos out of democracy, the taller the twin peaks and the greater the waste of human resources and humanity’s wealth.

I’ve been a fan of TED for years now because it tends to highlight a combination of truth, concern, science, arts, and of course it’s namesake acronym, Technology, Education, and Design (TED).  I like talks that shake me up a big and make me think. This one does that.

The source of this is at the following link: Yanis Varoufakis: Capitalism will eat democracy — unless we speak up.

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“We spend billions of dollars trying to understand the origins of the universe while we still don’t understand the conditions for a stable society, a functioning economy, or peace.”

Network Analysis of Economics as a Complex System

He uses analytic techniques from science to look at the ownership of global corporations and control of the economy.

So we started with a database containing 13 million ownership relations from 2007. This is a lot of data, and because we wanted to find out who rules the world, we decided to focus on transnational corporations, or TNCs for short. These are companies that operate in more than one country, and we found 43,000. In the next step, we built the network around these companies, so we took all the TNCs’ shareholders, and the shareholders’ shareholders, etc., all the way upstream, and we did the same downstream, and ended up with a network containing 600,000 nodes and one million links. This is the TNC network which we analyzed.

So he goes from there to control. How much control is how concentrated?

Disturbing data with disturbing conclusions

The talk is from 2012. It looks at the phenomenon of the great recession, the 2008 world financial crisis. But he goes into the underlying structure, and the enormous problems related to concentrated ownership and control in a very few hands.

If you want to compute the flow in an ownership network, this is what you have to do. It’s actually not that hard to understand. Let me explain by giving you this analogy. So think about water flowing in pipes where the pipes have different thickness. So similarly, the control is flowing in the ownership networks and is accumulating at the nodes. So what did we find after computing all this network control? Well, it turns out that the 737 top shareholders have the potential to collectively control 80 percent of the TNCs’ value. Now remember, we started out with 600,000 nodes, so these 737 top players make up a bit more than 0.1 percent. They’re mostly financial institutions in the U.S. and the U.K. And it gets even more extreme. There are 146 top players in the core, and they together have the potential to collectively control 40 percent of the TNCs’ value.

And what does that mean for the long-term stability, and peace, in the world? You decide. First, watch this 13-minute video. And by the way, the original is on the TED site as Who Controls the World.

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Malcolm Gladwell says trust the data

Whitney included this summary:

[Gladwell] tells the tale of Howard Moskowitz, a consultant who revolutionized the way companies align their product with their brand in the 1970’s and 80’s. There is much to be learned from Moskowitz’ example, especially as told by Gladwell, about how to use data driven buyer personas (sound familiar?) to provide the most possible value to your customer base.

Previous to Moskowitz’ research, companies were in the habit of seeing product development as a linear path towards one ideal item, as perfectly aligned with the desires of their customer base as possible. In order to develop an idea of what those desires were, traditional focus groups were used obsessively, rounding up endless groups of sample-consumers, and simply asking them what they prefer in a product.

Sheena Iyengar says put limits on choosing

Whitney followed that with this one, which he describes as “coming at the same problem from opposite sides of the ideological spectrum.” I like that. It fits my view of how much business is full of paradox and contradiction. Iyengar talks about the “choice overload problem”. The following is from his summary.

As a graduate student, Sheena executed a very interesting experiment with a local grocery store which was noteworthy for having a plethora of different options for all of their different product offerings (75 different olive oils, 348 flavors of jam etc.).

Sheena, though, was curious as to whether this actually promoted revenue or was a hindrance to it. To test this, she got permission from the store manager to set up a ‘Free Samples’ table in the store and do two trial runs: one with 6 options, and one with 24 options. She found that about 20% more people stopped when there were more options.

However, when tallying how many people actually bought a jar of jam as a result of stopping, she found that the table with fewer options was more effective as a marketing tool. Why might this be? This goes back to the choice overload problem. Sheena finds that if a consumer is bombarded with too many options, he/she will often ‘choose not to choose.’ For your business, that means lost revenue.

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I find this quote significant:

The fact is that most of the biggest catastrophes that we’ve witnessed rarely come from information that is secret or hidden. It comes from information that is freely available and out there, but that we are willfully blind to, because we can’t handle, don’t want to handle, the conflict that it provokes. But when we dare to break that silence, or when we dare to see, and we create conflict, we enable ourselves and the people around us to do our very best thinking.

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There is this moment in lighting that made me fall utterly in love with it. It’s the moment where all the pieces come together, and suddenly the world comes to life, as if it’s an actual place that exists.

I love it when people are in love with their work, and when they find something to do that they love, and pays them. This is clearly the case here. And it’s also a good reminder of the relationship between math and science and art and creativity. Some millennials I know divide the world into quant vs. fluffy. This kind of art is both.

The TED introduction says:

 she creates stories with soul and wonder using math, science and code. Go behind the scenes of Finding Nemo, Toy Story, Brave, WALL-E and more, and discover how Pixar interweaves art and science to create fantastic worlds where the things you imagine can become real.

The link to the source video on TED: https://www.ted.com/talks/danielle_feinberg_the_magic_ingredient_that_brings_pixar_movies_to_life#t-151746

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“The people we are coupled to [meaning talking to, sharing a story with] define who we are.  And our desire to be coupled to another brain is something very basic that starts at a very young age. “

Fascinating research here summarized by neuroscientist Uri Hasson, on how our brains become aligned when we hear the same story. He researches the basis of human communication, and experiments from his lab reveal that even across different languages, our brains show similar activity, or become “aligned,” when we hear the same idea or story.

This amazing neural mechanism allows us to transmit brain patterns, sharing memories and knowledge. “We can communicate because we have a common code that presents meaning,” Hasson says.

This is a 2016 TED talk. I chose it for my Friday video because I’m fascinated by the power of stories, as more true sometimes than truth, because of the way we think.

The source for this one, on the TED site, is http://www.ted.com/talks/uri_hasson_this_is_your_brain_on_communication

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Education

Does business education stifle innovation and creativity? You probably already know Sir Ken Robinson’s TED talk, from 2006, Do Schools Kill Creativity? It’s one of the five or so most viewed and most discussed TED talks. His basic idea is that school focus too much on the academic, not enough on other kinds of intelligence. He was talking about classic elementary education mostly. What about business, and business education?

I have trouble myself with some of the recent themes about education and entrepreneurship. I shudder when people ask, “Why get an education if I’m going to be an entrepreneur?” And then there’s the other one, “you can’t teach entrepreneurship.” I’m somewhere in the middle on these controversies; I believe general education makes life better; that the value of education isn’t to be measured in earnings dollars after education; that a liberal arts education is great preparation for entrepreneurship; and that an MBA degree was useful to me and can be to others, but isn’t a universal requirement, by any means. I’ve posted here previously 5 things business schools can teach and 5 things they can’t. And also, can business schools teach entrepreneurship?

The James March Question

But there’s also this idea, always in the back of my mind: the talk I had with James March, way back in the 1980s, about how higher education teaches us to do what everybody else has done, not to do things differently.

The best class I took at the Stanford Business School during my MBA years (1979-81) was taught by Professor James March, co-author of the book An Introduction to Models in the Social Science. It was about the same subject. He was funny. He was contrarian. He was brilliant. He had a mathematical model of a cocktail party that predicted how many people would be passed out at the end of the party, based on inputs including how many couples, how many singles, and, particularly important, how many more male singles than female singles. That may be too gender-specific for today’s world, but it was applicable 30 years ago.

I liked and respected Prof. March so much that in the middle 1980s I tried to get him to join me in what would have been a venture to create a game that teaches business. Prof. March didn’t join me and I didn’t create the new venture. I continued with my business plan consulting instead.

I’ve never forgotten the conversation we had in his office that day. I can’t remember the exact words, of course, but Prof. March reminded me that there is an underlying conflict between education and creativity. He was an educator, but he was also a contrarian and a thinker, so he enjoyed flanking our standard assumptions.

“Schools teach conformity,” he said. “Education is about reinforcing the supposed right way of doing something, meaning the way we’ve always done it, the way the establishment expects us to do it.” Schools taught that the world is flat until a renegade proved otherwise.

“New ideas come from people that haven’t been indoctrinated,” he said. This was of course before the phrase “think outside the box” came along, but he would have referenced that if we’d been later in time. Schooling is about learning how to think inside the box. If you believe this line of reasoning.

Here again, I run into paradox. I believe in education but I also believe what Prof. March suggests. Is the answer that you have to know the fundamentals before you transcend them?

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The study itself is remarkable. Waldinger credits luck and the persistence of several generations of researchers. About 60 of the original 600 men are still alive. Since 1938 they – a group of Harvard undergrads and another group of poor kids from Boston – answered questions, took exams, shared their lives with researchers on a regular basis.

So what keeps us happy and healthy as we go through life? Listen to this TED talk.

Click this link for the original on the TED site.

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