I just saw this graphic on “How to disagree” that is a perfect explication of the majority of intellectual exchange I see on the Internet:
To truly be accurate, the base of the pyramid would flare out much more, and the top three points would be much, much sharper. Regardless, you can now refer people to this pyramid whenever you see a rotten counterargument.
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There is very little in this world as useless as the endless hair-pulling between two factions of the neoclassical economics world, The Keynesians and The “Austerians.” For those of you who correctly sense this to be too boring to follow, allow me to get you quickly and painfully up to date so that we can get beyond this whole moronic intellectual framework and on to something much more useful for actual people.
Ever since the Great Financial Crisis of 2008, the Same Old Authority Figures have separated themselves into two groups in their attempts to “fix” the world economy by doing nothing new or interesting. First, you have the Keynesians and their spiritual leader Paul Krugman. Their philosophy is simple: if the economy is producing privation, ecological ruin, anxiety, institutional collapse, grotesque inequality and bankrupt governments, have central banks print a bunch of money and give it to governments and megabanks. See? All better! Note: If this does not work, you did not print enough money! If you point out that, for example, the United States was already printing tons of money when its economy went in the toilet, Paul Krugman will scoff at you and mention his Nobel prize.
Grimacing toward the Keynesians in a hip-hop pose à la You Got Served is a group we can call the Austerians, economists that believe that we can fix the economy through “austerity.” This is accomplished by doing almost all of the same things as prior to the crisis, while making up any shortfalls by cutting government programs for the poor, sick and old. Cutting wages wouldn’t be a bad idea either, according to Austerians. (Why look at those nice Bangladeshis! Reasonable wages and a much lower Debt-to GDP Ratio than that horrible Europe!) If we follow the austerity path in a monastically devout way, we can reduce government debt, which is the Worst Thing In the World, despite that fact that most industrialized countries have been accumulating debt at a steady clip since the end of the gold standard, through times good and bad. According to Austerians, Government debt in 2013 is still the mostest awfulest thing ever which is precisely we everybody keeps producing lots of it and trading it on complex, state-sanctioned markets. Because it’s terrible and all the poor people need to help make it stop!
If you go on television to talk about The Global Economy, chances are either the hosts or the guests will attempt to suck you into this wrestling match. You are not allowed to stay on the sidelines, insisting on a broader and more nuanced understanding of our current economic predicament – you must immediately pump up on steroids, don Spandex pants and get in the ring.
Here are the only legal moves in Austerity Wrestling:
Illegal moves in Austerity Wrestling are as follows:
Like so much in today’s media, this is the game – we take a fascinating event in world history – a historic economic shift driven by demographics, management techniques, energy transition, technology and more – and we reduce it to a framework that is clean, well-defined and useless. Coke or Pepsi? Mac or PC? “Quantitative Easing” or “austerity?”
I got to play this game briefly on RT’s CrossTalk with Peter Clavell. The host, Clavell, actually avoids this construct, but the moment I am asked a question about austerity, the wrestling match is on. I say that obviously you can’t spend money indefinitely without consequences, no matter who you are. One of the other guests immediately straps on his Spandex and goes all ‘roid rage, accusing me of (GOP communications guru) Frank Luntz-style distortions so that I can support “my” plans for austerity. Huh? Since when is it a controversial thing to say that spending like a drunk sailor has consequences? How does that equal wanting to squash the poor while I laugh over at Karl Rove’s house? Well, in the Austerity Wrestling ring, it makes sense.
Eventually, I got to make my real point, which is that neither Keynesian nor Austerian politicians have articulated what’s going to happen after their miracle cure “fixes” the economy. Where are we going? If we suffer through “austerity,” what’s next, and how is it better? If printing money is the way to success, how long until we actually see some reductions in unemployment and the revitalization of some downtowns? I think that austerity has worked well for the Estonians and is actually causing an epidemic of suicide in Greece and Italy, so obviously there isn’t one right answer. I’m merely interested in the quality of economic leadership – people who can articulate a vision of a better future. The cognitive onanism of a bunch of theory-masticating college professors and central bankers is one step below useless for me and everybody else.
In the meantime, I’m treated to opening the newspaper and attending conferences where theoretical economists whose work did nothing to predict or prevent out current predicament trumpet the success/failure of printing a lot of money (Look! The Dow is awesome! Also, our kids are doomed!) or point out the success/failure of the other guy (Look Latvia is doing great after austerity! And Portugal is doing terrible! Boo!) But just like professional wrestling, neither side ever wins, and the whole spectacle is a distraction from anything substantive going on in our lives.
And note that nobody will ever mention the real reason behind all that debt – it is a new way of executing great power politics through currency manipulation and financial engineering, all while telling Regular People that government debt works the same way as your checking account. If we’re going to discuss sovereign debt structures and bond markets, well let’s get into it – but this will preclude us from simultaneously guilting the guy in the street into believing that there is something bad he did yesterday that now requires his retirement to be delayed by a decade. Thus, we avoid having a real discussion entirely.
Bottom line – our economic woes lie in our failure to understand the future, not in our inability to declare a winner among the neoclassical economists from the 1940s. Huge questions remain, with answers that will impact real people’s lives. How can we transition away from our fragile, plutocratic financial institutions toward something that allocates capital in a flexible and useful way? How disruptive will the current energy transition become, and how fast will in change national fortunes? How much will climate change disrupt the world economy? What is a “nation-state” in a hyperconnected global economic system where both national and supranational policy makers seem unequal to the task of managing complexity? What about the unprecedented surge of aging populations? What are the rights and obligations we have to society as the economy becomes more abstract and global?
These are all questions we need to discuss, and their answers will be useful to real people, actual business leaders. But as far as the angels-on-the-head-of-a-pin discussions about austerity go, I have had my fill. Every moment spent wondering about that construct is a moment that could be spent helping somebody, revitalizing a downtown, finding a job for a young person. I’m throwing out my Spandex trunks.
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This past weekend I drove from Saint Louis to Oklahoma City on the original Route 66 – “The Mother Road.” A friend of mine wanted to attend a meetup of Saab owners using the classic highway, so I road shotgun to provide company and observe what remains of the roadway that was the primary route between Chicago and Los Angeles from 1926 to 1960. In the end, I really wanted a lot of housepaint and a crew of painters.
Let me explain.
As you come out of Springfield. Missouri you eschew the popular I-44 and ignore the redirected U.S. Route 66, turning down some back roads to arrive at the real Route 66. This is the view from 1940, photographed this weekend:
I can only imagine that this was the view that your grandfather had as he made the classic journey Westward: cement concrete roads, barely two-lane, isolated services, generally unspoiled landscapes, the road wandering off into the promise of America. Also: gas for twelve cents a gallon! This is the Route 66 of the Nat King Cole song – a long and winding road that goes through a bunch of beautiful, thriving communities on the way to California. It goes through Saint Louie – Joplin, Missouri, Oklahoma City – criss-crossing through Galena, Kansas, Catoosa, Oklahoma and many other communities whose names are obscured to all but the locals.
In 2013, this road does indeed wander off into the promise of America, but that promise has been broken. When the Eisenhower Interstate System was completed in the 1960s, the endless flow of motorists opted for wider, faster roads that did not bother stopping for every little town. As information technology and biotech has advanced, centralized farming has either moved farming under giant corporate holding companies, or to new places all together, such as California and points west. Light manufacturing has gone to points far east. As such, the view of most of the small communities on Old Route 66, is more like this:
I’m going to spare you the photos of the endless array of trailers and makeshift houses along the way, linked only by the cracked and weed-ridden concrete of the old Mother Road, left to rot. This, too, is America in 2013, and if you extrapolate the trend into the future, it leads straight into a vision of dystopia.
My mind wandered to all of the various wars and bailouts that have consumed this nation’s blood and treasure. Since 2001 there have been those two wars in far off lands, followed by a decade of nation building. Later, after a senseless deregulation of the banking industry we sent endless rivers of printed cash flowing into the coffers of the banks whose recklessness nearly set the world ablaze. We guaranteed the survival of General Motors, AIG, Fannie and Freddie. The total cost for these policies: trillions of dollars.
All I want is some paint.
I see the men, women and children scraping around the remnants of these once-thriving American communities, and I wonder how they can keep their head up, walking by abandoned downtown building after burned out house after dilapidated mobile home park. Our national government jumps at the chance of keeping car companies and banks from suffering the consequences of their mismanagement, and meanwhile, vast swaths of the United States are left to rot. We pour out our treasury to rebuild Iraq and Afghanistan, and turn a blind eye to the Heartland.
We could have, during this interminable series of bailouts, set aside one billion dollars for a paint job. Imagine the collective impact of repainting downtowns in bright fresh colors. Think of the people of these communities, once the backbone of our nation, told by the rest of us – you are not forgotten. Consider the difference in a young person between growing up in a place rotting off the bone versus one in a town that is still honored.
One billion dollars- that’s a fraction of what we spend on the drug war, interest on the debt, policing the hills of some country that Americans can’t identify on a map anyhow. Senators spend one billion dollars before you have had your morning coffee.
Imagine what it would mean to these people.
Imagine what it means to have pride.
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When my friend Doug Stephens, retail futurist par excellence with a great new book out, told me about this, I almost thought that it was satire of the marketing profession. And yet, it’s a real thing – selling candy through the lens of the gay rights movement - and a signpost that tells us about the future of branding.
In an effort to make the “Mike & Ike’s” brand of candy relevant to young adults, the brand’s managers decided to bolt on a story about Mike & Ike as some sort of romantic couple now going through a divorce. From the article “Brands Come Out of the Closet“:
Caught in the crossfire of the gay-marriage debate were Mike & Ike, Just Born’s old-school fruit-flavored candy from our childhood. The candy brand has been around since the 1940s, but has been relatively quiet the past few years. All that changed in April 2012, when in an attempt to capture a younger demographic, the company launched a marketing campaign based on Mike & Ike’s troubled partnership.
Though the advertising, social media and packaging campaign attributed the split to creative differences, it wasn’t long before rumors were flying that it was part of a “gay divorce.” The Family Research Council publicly denounced the brand, saying, “It’s just another subtle example of society chipping away at the value of marriage.” Is the world ready for a maybe-gay candy? It appears so. Mike & Ike had its best year sales-wise in a decade, up more than 7%; it also tripled its Facebook fanbase.
The company has reinforced this original take on candy with images designed to remind your of the impending personal strife facing the two male characters who have never been seen in public.
Evidently, Ike is taking the whole thing rather hard and erasing any trace of Mike. You know how it is when a romance goes bad.
But wait! Facebook update! They are getting back together! Or something!
Once upon a time, people actually sold products by describing their benefits.
Then, as time went on, they moved on to showing how the product reinforced whatever identity the customer already had (or aspired to have)
Now, we’re in a brand new era. The future of branding seems to be about intriguing people with a story that captivates them – even if it really does not have a thing to do with the product or service sold.
In the old days, you would actually describe how delicious Mike & Ikes are. If you followed late 20th century logic, you would need to show how Mike & Ike defined you as a fun-loving or creative or whatever kind of person.
What we see today has no connection to that logic whatsoever. Nobody really thinks that Mike & Ike candies cause your gay romance to go bad – so it’s not a question of product feature. And nobody at the ad agency is attempting to say – “Mike & Ikes – the candy for people who believe in gay marriage, even bad ones.” And thus this isn’t a call to some form of identity.
No, the bad gay romance thing is just kind of funny. It’s ironic. For a young adult (the kind that isn’t aware of the diabetes epidemic) perhaps this kind of entertaining narrative will induce them to buy this brand of candy more often because – who knows what those crazy guys at Mike & Ike will come up with next. So, as we can see from the results, more people are willing to “like” the brand and purchase the product just because the narrative is unexpected.
In fact, this kind of phenomenon is revolutionary. What matters here is not the product or the consumer, but the brand itself. The customer is potentially drawn to the product because the people behind the brand seem to be plugged into the zeitgeist. Gay marriage is a cresting a huge wave all over the world; just as I write this, the French Senate approved the “Loi Taubira,” thus making gay marriage and adoption the law of the land. What does this have to do with candies? Nothing. But the brand is stating clearly, “Hey, we’re hip – we know what is interesting and relevant.”
Branding is really old hat these days – the new generation has been marketed to death since they were in diapers. Hearing about new products and what they mean to our identities is really old and busted. Connecting with a group of people – even through something trivial like candy – who know what’s important in the world – that’s something people seem to hunger for.
Is your brand able to connect itself to the larger cultural evolutions in the world? It seems to be driving sales.
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Eric Garland is a guy who studies big things that are changing. He shares his findings with school kids, executives, and audiences around the world. He is the author of three books on future trends, a regular public speaker, and a professional bassist.
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