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Observer effect


The (one of many) problems with the Ayn Rand philosophy essentially boil down to the same thing I was trying to say to my uncle in Boston two years ago at Thanksgiving about America’s greatness.

An individual’s skill at their chosen income generating tasks is independent of the skill of making money. Yes? Tons of examples, of course, of poor geniuses, artists, scientists, innovators, through the ages.

The fundamental premise of Randian capitalism is that all skill is valued in $, and should be valued in $, as a common denomination of exchange. Which is all very fine, and it is an elegant solution to the centuries old problem of productivity benchmarks and economic drivers. But what about people who have great skill at their chosen income – e.g. painting – but do NOT know how to market themselves? We can leave it to the market to decide, yes, but that only works if there is full information symmetry, etc. etc. As a marketing person I KNOW that there are levers that you should and can pull to command a higher price for the same product. If Picasso is unaware of these levers, does he deserve to be a pauper?

And similarly, is America great because the nation has been at the forefront of productivity, or is it at the forefront of productivity because it’s a great marketing nation? Are not most of America’s productivity gains over the last two centuries due to a single-minded focus on productivity? If yes, then is some nation that is more focused on, say, culture (France?), or happiness (Bhutan?) a failure because it does not measure up to your measure?

Corollary: Is Obama a great manager, enough to President, because he has managed his campaign for President ‘so well’? That’s what he said when he compared the size of his campaign to the size of Sarah Palin’s Wasilla.

“Well, my understanding is that Governor Palins town of Wasilla has, I think, 50
employees [she was also a Governor, and the state of Alaska has 19,000 employees, but why let facts get in your way…]. We’ve got 2500 in this campaign. I think their budget is maybe $12 million a year. You know, we have a budget of about three times that just for the month. So I think that our ability to manage large systems and to execute I think has been made clear over the last couple of years”, Obama said.

John McCains spokesman called the suggestion laughable. For Barack Obama to argue that he’s experienced enough to be president because he’s running for president is desperate circular logic and is laughable.

Anyway, so if Ayn Rand’s philosphy is great as a first step, aka classic capitalism, it’s probably time for a quantum capitalism, taking into account the observer effect, and iterate. The drafter of the Observer Effect in macroeconomics is likely our generation’s Keynes and more. Who’s up?

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