That quote in the headline is attributed to Frank Borman, former Apollo astronaut and Eastern Airlines CEO. I’m referencing it because it relates to some thoughts I have about something Nick touched on yesterday, the idea of integrity. This has always been a hot topic for me, for a few reasons. One is probably because of something a therapist said to me years ago, which was “you seem to have an almost exaggerated sense of fairness“. He was spot on in that observation I guess; if I were an attorney, I’d probably be a public defender, or some kind of activist lawyer for human rights or environmental issues. And one of the few things that will get me genuinely angry – I mean pulse-pounding, temples throbbing angry – is injustice. The other reason is that I’m either blessed or cursed with what a good friend of mine describes as a “gently ruthless sense of honesty”. This doesn’t make for a lot of adoring acquaintences, but it certainly cultivates reliable, devoted friends! But enough about me and my alleged virtues in this area, I want to talk about why I think we need to re-instill some integrity in the culture of commerce and capitalism.
Nick correctly observed yesterday that he and I find substantial common ground in spite of some slightly different views on some political issues. I believe that this is true because we allow for nuance in our discussions, which is rare these days when most people in the states discuss politics. And I think that this “integrity thing” we agree on is based on an informal but rational set of observations of the business world over the last few decades. And that’s what I REALLY want to touch on, because I’m convinced that bringing genuine value back to commerce is the only thing that will bring capitalism as we knew and loved it back from the brink of catastrophe it has hovered near for several years now.
Nick and I agreed early on that we would maintain a few simple principles in our business relationship. One was that although we may take pointers from methods like MLM’s, we would never adopt their core strategy. My view of MLM’s is perhaps harsher than Nick’s; I would comfortably describe them as Ebola-like, in the sense that although they appear to be incredibly successful in the short term, they ultimately devour their host(s). We also agreed that although we would vigorously promote our products, we would never sell hype itself, or sell something that in fact had no value other than the value that one had convinced oneself it has, for example the kind of “get rich on the Internet” schemes that are so common. I take a lot of pride in these simple decisions, and they make it a lot easier to throw my full energy and passion into our pursuits.
So back to Frank Borman and his quote from the 1980′s. The full quote was “I’ve long said that capitalism without bankruptcy is like Christianity without hell. But it’s hard to see any good news in this“. He was referring to the demise of Eastern Airlines. His view expresses what is these days loosely referred to as being from the Austrian School of economics, which – among other things – embraces the idea that business failures are a crucial aspect of developing a healthy and strong network of commercial transactions. In my opinion (and I’m far from alone), the abandonment of this simple idea is at the crux of almost every major economic and business woe we face today. Why bail out failed banks? It only encourages them to take greater risks. Why give CEO’s salaries 400 times their companies’ average employees? Statistics and facts have proven the absurd fallacy of CEO salaries and talent retention. Why cut staffs, send jobs overseas, and provide progressively inferior service for ever-higher prices? Why build crap products using environment-decimating methods and underpay the laborers that expose themselves to these processes daily?
Because we have a disease. And the disease doesn’t even have a handy name, because its symptoms are so diverse, and most of the explanations of the symptoms are really justifications based on the importance of profit for profit’s sake, and the indispensability of the elite leaders who are the only ones that actually benefit from it. The disease’s causes are fairly simple though, and its cure is even simpler if you dare take the medicine. The causes? Greed. Arrogance. Imagined superior knowledge. Pride in deceit masked as a mature growth beyond naivete. If these notions sound trite or sentimental to you, it’s probably because you yourself have fallen prey to this sort of “easy” path to riches (i.e. selling toxic investments, crappy products, and infinitely parceled and productized services) that abandons any sense of honor, true conquest, and responsibility. We’re living in a world controlled by that 80′s caricature of success named Gordon Gekko.
The cure? Create the best product possible. Sell it at the most competitive price that still enables you to build a positive future and a healthy community. When you fail, pick up the pieces and try again, and do better the second time because you’ve learned from your mistakes.
The cure, in a nutshell: Honesty. Hard work. And that other word Nick mentioned. Integrity.
