January 3, 2006

Business Column of the Year: Rich Karlgaard on the “World’s Worst Disease”

This is a good place to start as everybody returns for the first “real” business day of work in this new year.

I know it’s early January, but this may indeed be the Column of the Year — Forbes’ clear-headed Rich Karlgaard outdoes himself with his Jan. 9, 2006 column (may require subscrption, which is why much of it is excerpted below):

World’s Worst Disease

It’s not cancer or AIDS or avian flu; it’s a monstrously flawed idea. The sickest thinking–and the source of most of human misery throughout the ages–is based on the following beliefs:
• The Earth is running out of resources;
• People consume more than they contribute;
• Wealth is a zero-sum distribution game.

History overwhelmingly refutes these ideas; otherwise, humankind would still be living in caves, sharpening spears for the hunt. Our lives would be brutal and short, lasting on average about 30 years. We’d enjoy no books, movies or iPods; we’d drive no cars to visit grandma over the holidays; we’d savor none of her gooseberry pie if the economic pie hadn’t been growing all along.

Yet most politicians, economists and journalists act as if growth were a mirage and wealth a zero-sum game. What else accounts for last November’s headlines yelling about GM’s cut of some 30,000 jobs? Does the creation of 30,000 jobs get equal treatment? Why not? That’s about how many jobs are born in the U.S. every six days.

Origins of the Virus

Why do so many opinion makers promote the zero-sum view? I think that politicians, even the best and brightest, become zero-sum thinkers because they occupy a zero-sum world. Only one person can be President of this country; only 50 can be governors; only 100 can be senators. The most creative entrepreneur in the world can’t change these parameters. Politicians live in a world in which one person’s gain is another’s loss.

You’ll also find most economists and professors in the zero-sum camp.

….. It’s no surprise that the top business thinker of the last 50 years, the late Peter Drucker, operated outside of the university system. Drucker, who had escaped Germany in 1933, was no Pollyanna and no stranger to evil. But he saw that evil had its roots in a belief system of limits. The Nazis believed there was room on the planet for only one ideology and one race.

Journalists at mainstream media organizations wallow in a zero-sum world: There can be only one evening television anchor and one top editor at a newspaper. All others are beta dogs. Thus from the MSM we get a staple of alarming stories about job losses, trade and fiscal deficits, global warming, the price of oil rising to $100 a barrel and so on. Zero-sum nonsense, all of it. Why does the mainstream media love environmentalists? Both groups share a zero-sum view of the world.

Meanwhile, much of the better journalism and commentary has been migrating to blogs. No surprise here. Anybody who creates a blog is: (a) an entrepreneur and, thus, probably NOT a zero-sum thinker; and (b) a producer first and a consumer second. These two attributes alone guarantee that the blogger has a clearer view of how the world really works than does the zero-sum thinker toiling away at his mainstream media position.

Maybe “life is not a zero-sum game” should be the year’s mantra.
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UPDATE: Just before year-end, Don Luskin’s post on Karlgaard’s comment about “most economists and professors” being zero-summers generated quite a bit of heat, and a fair amount of light.

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1 Comment

  1. World’s Worst Disease Identified

    Tom Blumer found an interesting piece on the World’s Worst Disease by Rich Karlgaard writing in the 1/9/2006 Forbes. Since registration is required, Bizzy Blog has an extensive excerpt. Here’s the premise…

    Trackback by The Larsonian — January 3, 2006 @ 10:01 am

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