Jonathan Brun

Jordan Peterson is very dangerous

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Council of Nikea, where the roman emperor became Christian.

There are two ways or organizing the world. The first method is the most common and the oldest. It involves the collective adoption of a set of social rules that are imposed though a mixture of state institutions, religious institutions and social pressure. Most traditional societies functioned this way. Grossly simplified, from an anthropological point of view, this way of organizing groups of people evolved first from a “respect your elders mentality”. The young and adults of a group could easily overthrow the elders of a group, but the elders managed to impose a set of rules and convince them to respect the wishes and opinions of the elders. This is referred to as a gerontocracy – where the old are in charge. This then evolved into a system where the old men were the dominant actors in a society and could set the rules, expel unruly members, arrange marriages, etc. Most religious societies and many aboriginal societies still function this way. See the Amish, the Hassidic Jews, religious Muslim society, etc.

The alternative way of organizing society is a loose set of rules that are mutable and changeable, with open membership to that society based on merit and physical and mental force. This way of organizing is more chaotic and unpredictable, but it can lead to more innovation and creation that upsets the current order. Examples of this are societies such as ancient Greece, ancient Rome, and of course, western society since the French Revolution – give or take a bit. No society is uniform and the switch between these two modes is not binary, parts of society can live in a highly structured environment while other parts are far more open and flexible. I live in downtown Montreal, an open and welcoming city, surrounded by a highly insular group of Hassidic jews. We get along, but we share few fundamental values.

These two ways of organizing society appeal to different people at different times. In times of strife or stress, order and rules are nice. In times of abundance and growth, flexibility and loose rules are great. For Western Civilization, the collapse of the Roman Empire gave rise to a static set of Christian rules. The collapse was largely due to the Muslim (read: old style world) expansion through North Africa and the Middle East around 750 AD. This expansion pushed the Roman empire north and finished it off after a slow death since Constantine converted to Christianity.

It took 1000 years for the Christian order in Europe to give way with the renaissance and the levy really broke with the enlightenment and the French revolution, where a static old order was literally decapitated. This opened up room for groups to manoeuvre and eventually led to the industrial revolution in Britain, creating material abundance and further disruption. Two hundred years later, give or take, we are feeling a backlash. With economic growth and wages slowing since the 1990s, certain people who were previously on top due to inherited wealth of the industrial revolution (read: white men) are starting to long for that old world order, one set by old men with clear rules.

Along comes Jordan Peterson. For those who have managed to avoid the guy, he is a University of Toronto professor who is leading a charge towards a return to traditional values. He published a bestselling book, 12 Rules to Life, that lays out a set of rules to put your life in order (and those of others too!). He is a very compelling speaker, storyteller and a passionate advocate for a return to something more primal, older, simpler and more ordered than our globalized, equal opportunity, women laden workplaces. He has a tendency to use hyperlatives and extrapolate from small issues to global crises that will create a world catastrophe. He equates the loss of traditional male masculinity with the death of god, for example. In this Vice interview, he states that “Can men and women work in the workplace… we do not know! [if women and men can work in the workplace]. Lipstick … is a sexual display in the workplace. A women [wearing makeup in the workplace who does not want to be sexually harassed] is hypocritical.” This is  a common strategy for Jordan, things are either clear and simple or unknowable. Nothing in between!

Peterson has been on many, many shows in the past few months and this is not to mention his own YouTube channel, that inclues thousands of hours of video. Whenever someone speaks that much, it is easy to pick and choose their mistakes. I do not know the guy, but after originally being intrigued by him, I find myself called to speak out against this false prophet who is contradictory, scheming and lying. He advocates for monogamy and honesty, but says he would vote for Trump. He refuses to dissavowe right wing white supremacists and believes that college campuses are festering pools or revolutionary children who need to be taught a lesson. I do not really have a bone in this fight, except that I believe in an open society that welcomes honest hard working people and strives to improve the lives of the next generation.

The best and most detailed damaging take down of Jordan Peterson that I have seen is the letter in the Toronto Star by his former mentor and advocate at the University of Toronto, Bernard Schiff. This is a man that housed Peterson and his family for months and lobbied the University to hire Peterson in the first place. In the article, Schiff states plainly,

“He was a preacher more than a teacher.” and goes on to say…

“Jordan is a powerful orator. He is smart, compelling and convincing. His messages can be strong and clear, oversimplified as they often are, to be very accessible. He has played havoc with the truth. He has studied demagogues and authoritarians and understands the power of their methods. Fear and danger were their fertile soil. He frightens by invoking murderous bogeymen on the left and warning they are out to destroy the social order, which will bring chaos and destruction.

Jordan’s view of the social order is now well known.

He is a biological and Darwinian determinist. Gender, gender roles, dominance hierarchies, parenthood, all firmly entrenched in our biological heritage and not to be toyed with. Years ago when he was living in my house, he said children are little monkeys trying to clamber up the dominance hierarchy and need to be kept in their place. I thought he was being ironic. Apparently, not.”

Need I say more? Of course, Peterson’s Darwinian social views also presupposes that there are no institutional prejudice towards certain people and that everyone as an equal shot at life. He seems to think that the game is not rigged and if you follow his 12 rules, you will be ok. To believe something along those lines it to be a complete idiot.

In this BBC interview, the interviewed really pins Jordan to his own cross. One of Jordan’s philosophical cornerstones is that Western society is by nature more individualistic and freedom loving than other society [read Asian and Muslim]. This is both clear and good according to Peterson. Yet, with a bit of pressure it becomes quickly apparent that there was nothing terribly individualistic about the Catholic Church (or the Orthodox Church for that matter). To be a member of Catholic society between 700 AD and 1700 AD was very much a collective act. All your sins could only be forgiven by the church and you could only reach heaven through a clear set of rules and an institution ruled by older [celibate] white men. By the way, Peterson was celibate before marriage. However, Peterson on the one hand labels himself as a liberty loving liberal who believes in individual freedom. Yet, he advocates for a set of clear rules that everyone should follow. Peterson is on the express train to hypocrisy town! The BBC hosts correctly identifies Peterson for what he is, “a fiery evangelical baptist preacher”.

What is so dangerous about all this? Peterson (and others) are creating a narrative for angry white men who feel that they are losing their place in this world. The place they presume to have, is at the top. The presumption of superiority is not based on skillsets, culture, or intelligence – it is based on looking at the past and saying, “that is how it was, that is how it should be”. Yet, the real reason western society excelled and grew over the past three hundred years (after 1000 years of stagnation) was not because of a strict set of rules or a set social hierarchy. Western society grew because we destroyed the rules of yore, tore down oppressive institutions, created the industrial revolution, took land and ressources from the weak and used slave labour to grow our wealth. It wasn’t pretty, but it did establish Western society as top dog. Losing this position is scary and some look towards the past for a solution. This is dangerous and not unlike past social convulsions.

Perhaps the most devastating attack on Peterson was done by standup comedian Jim Jeffries. Jim Jeffries came to fame thanks to a hilarious (and scary) video about gun control in the United States. He simply explained that Americans love their guns, not for freedom and liberty, but because guns are fun! He is correct.

In Jeffries’ interview with Peterson, he gets Peterson to very clearly state that we should not force people to bake cakes for homosexuals or blacks if the [professional] bakers do not want to. A few seconds later Jeffries confronts Peterson with the challenge of getting southern US restaurants to serve black people during Jim Crow era. Peterson’s position crumbles like the cheap deck of cards that it is. Peterson confesses he was wrong and we should force bakeries to serve everyone. At least Peterson admits he is wrong and frankly speaking, he is wrong – across the board on many issues. Peterson has other ridiculous positions such as the one where he says gay marriage is acceptable (barely) because it will reduce the amount of extra-marital sex homosexuals have and they may have sex with less people. Terribly utilitarian, terribly stupid.

Augustus, emperor of Rome

There is a tomb in Rome. The tomb of the first true emperor, Augustus. He inscribed his accomplishments and his tips and tools for governing Rome. He stated, you have to build, build, build and invest in conquest. That, my friends, is the solution.

To keep our world of progress and democracy alive, we must build and conquer new frontiers. We must build new technology, roads, bridges, Hyperloops, reusable space rockets, electric cars, artificial intelligence, technology to clean the oceans and the air, and robots to relieve us of menial tasks like driving cars and trucks. We must build social systems that distribute collective wealth to allow for each person to have an equal opportunity in life. We must build tools to communicate across cultures and preserve cultures. We must build systems that welcome immigrants and integrate them into our societies. We must build infrastructure so other countries and civilizations can grow and prosper. Through collective building, we align our visions. When we sent a man to the moon, the whole world looked up to the stars, together. Humans are social creates – we want pride, acceptance, comfort and opportunity. We can try to offer that one of two ways, through a strict set of rules that puts everyone in their place or through a collective effort to build a better world for which we do not yet know the rules.

Additional Links

Mary Beard Documentary on Rome[:]

[:en]B2B SaaS in China[:]

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China is a large and tempting market for software vendors. In April 2017, our Canadian based SaaS B2B company Nimonik acquired a similar company base in Shanghai, China. The company in Shanghai is called Envitool and was setup in 2010 by a Swedish company.

Envitool is a Wholly Owned Foreign Enterprise (WOFE) and it offers an online service that helps businesses understand and monitor environmental, health and safety regulations. It also offers some consulting services that are critical to the use of the software system. When researching the market and legal requirements in the run-up to the acquisition, I read some interesting articles about selling software as a service in China and insightful articles on dos and dont’s on China Law Blog. Despite our research, there was not a lot of positive articles on B2B SaaS or SaaS in general in China.

Since the acquisition we have learned that running SaaS in China is not as hard as you might think, but it does require additional resources, costs and complexities. For one, you need to pick the appropriate legal arrangement for your entry into the Chinese market. The company was already a wholly owned foreign enterprise (WOFE), but we did look at various options below.

Legal Options for SaaS in China

1. Do business through a Reseller:

Keep the server is located outside China to reduce risk that the Chinese government would put up a firewall and block access. At a minimum, the reseller locates customers for the foreign company’s SaaS product. The reseller provides the ultimate customer with a username and password that allows the customer to connect to the foreign server hosting the SaaS product. The reseller collects the fee from the customer and deducts and pays applicable Chinese business and income taxes and then remits the remaining amount to the foreign software provider.

2. Set up a WOFE

We estimated it takes about 6 months of time and  $50K to $100K USD for paid up capital. Once paid up capital is resident in China, restrictions apply to taking out 50% of it, once the WFOE is profitable. Basically, you need to park money in the company in China and you can never take all of it out.

3. Do business through an Agent

Licence the your software to a Chinese entity that obtains the commercial ICP license that allows for offering the SaaS service to Chinese customers through a Chinese server. If a partnership type arrangement is set up, the Chinese Agent would invoice and collect payment from customers, and continue to be responsible for the operations in China.

4. Do business directly in China from Overseas:

You are short paid for the amount of taxes (withholding tax 10% & VAT). Payments may be delayed and clients may not receive permission to send payment as they cannot easily send money overseas. As a non-Chinese company, it would be difficult to get approval to run the software on a Chinese server, and if run on a non-Chinese server, you run the risk that the Chinese government would put up a firewall and block access.

Key Lessons Learned So Far

For a variety of reasons we opted to acquire the existing WOFE and continue to run the company from China. We are in the process of integrating the data from the Envitool software into our more modern platform, NimonikApp. Once that is complete, we will move all of our clients and data to the new platform and offer only that to the Chinese Market. We maintained the legal entity in China, maintained our ICP licence and ensured that we have trademarks in China.

To setup the Swedish Envitool company in 2010, the services of Scandic Sourcing were used. This is a Swedish consulting company that helps businesses setup in China. They also offer back-office services related to accounting, taxes, payroll and other items. We are still using their services and are very satisfied. They work with our team to ensure that all of our documents and paperwork are in order.

Getting Paid

Though all the legal questions are fun and interesting, the main worry for many foreign businesses is “will I get paid and how!” If there is one thing the Chinese Government is serious about, it is the collection of Taxes. Invoicing in China is interesting, the workflow is as follows:

1. We speak to an existing or a new customer
2. We send them an order form with a quote, this order form is stamped with our company seal (called a Chomp)
3. They sign and return the order form (sometimes in paper format and sometimes in electronic format).
4. We then send a real invoice (FaPiao), this is printed from a specific machine that is connected to the government servers, so they know exactly how much we charged, when and to whom
5. We stamp the invoice with another company seal (you have three different ones, one of which authorizes the sale of the business)
6. We then physically send this invoice to our client
7. Our client pays us via bank transfer
8. We charge a 6% VAT on all of our invoices and we have to remit that amount immediately, not when we get paid.
9. If an invoice never gets paid, it can be cancelled, but it is complicated. This happens in less than 2% of our cases.

I could go on with the intricacies of managing a team of Chinese sales and EHS experts, the cost pressure from local Chinese competitors and the demands for constantly increasing salaries – but I will spare those details for now. Long story short is that you can do B2B SaaS in China, but be prepared to invest at least 500 000$ before you see profit and make sure you work with local partners who really understand the system. Feel free to contact me with questions or comments, always happy to help a fellow weiguoren!

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[:en]Who will lead the world?[:]

[:en]Western media is biased against China. Then again, the west is biased against everything that is not western. From ancient democratic Greece, to the Roman Empire, to the Christian world, the renaissance, the enlightenment and the industrial revolution and putting a man on the moon – we think we are the the best off the best. Nevermind the slavery, the crucifications, the witch burnings, the constant warfare, rape, pillage, massive environmental damage, imperialism, the holocaust, foreign wars and the treatment of minorities – we are the best! We are taught at nearly every level of schooling that the logical endpoint of human societal development is the path the west is on, the ideal system, though imperfect is the liberal representative democracy. What if we are wrong?

History is a long and winding road, the victor never permanent nor clear. Today’s global geopolitical situation is as cloudy as it has been since the 1930s. Back in the 30s, many leading politicians and thinkers were engaged in a serious debate over the merits of capitalist market economies, fascist dictatorships and communist nations. Capitalist market economies won out, proving many smart people wrong. However, this does not mean that our system is the long term solution or that it beats all other potential solutions. It might, it might not. Today, the rise of populist protectionist anti-immigration nationalists in the UK, Austria, Turkey and the United States, contrasts starkly with the defence of globalization by China, France and Canada. To add to that, the ongoing regional wars in the Middle East create great uncertainty over the future of that part of the world. Where will Saudi Arabia, Lebanon, Iran and Tunisia be in 20 years? I have no clue. More and more, I am asking myself what Europe and its former colonies will look like 40 years? Will we still be the dominant economic an cultural powers or will we have returned to an Asia centric world that dominated the world from 400 AD – 1700 AD? If so, what will happen to the west?

For most of human history, the economic centre of the world was Asia. Asia had the most advanced technologies, the most complex societies and the wealthiest nations. For a variety of reasons, Europe emerged as a leading intellectual powerhouse with the Renaissance and then with the Enlightenment and the Industrial Revolution. This took about 800 years after the fall of the Roman Empire. Why this happened is well dissected in books such as Guns, Germs and Steel and other anthropological studies. One of the standard narratives we tell ourselves is that West’s rise required democracy and competition. We explain to our muslim friends or our Chinese friends that our democratic institutions allowed for the intellectual freedom that led to the three iterative improvements during the Renaissance, Enlightenment, and the Industrial Revolution.

Of course, there was no true democracy until 1776/1789, so maybe democracy was not the key. Despite a rather monolithic Church, the competing states and aristocrats in Europe along with physical mobility allowed for competition, innovative ideas and eventually, massive cheap labour for factories. In a sense, though there was no democracy until the late 18th century, Europeans had more individual liberty than Asians as they could and did move from one nation to another with their ideas and projects. The famous story is that of Christopher Columbus who visited three kings before obtaining the venture capital to set off for a route to the Indies and needing up in the Americas, the rest is history, as they say. We are told that without individual freedom in Europe, the momentous inventions and advances that led to most of our modern day wealth would have not been possible.

When the European powers controlled most of the world and invaded China in the mid and late 1800s, our production capacity was 10 times more efficient than China due to the use of fossil fuels and the invention of the steam engine. (See Richard Baldwin, The Great Convergence, p. 59). 10x times can be hard to imagine, but try to imagine a country that is 10x more productive than the United States (or Sweden) on a per capita basis. This discrepancy is so massive it would inevitably lead to domination of one nation by another and likely to a sense sense of superiority.

In contrast to clearly divided European powers post Peace of Westphalia, China had a centralized imperial system that shut its doors to outsiders and trade in 1422, starting its decline to a impoverished nation. Some argue that had China been more fragmented and more individualistic, it might have had the ability to innovate like the West. Additionally, its lack of rule of law and democracy prevented new innovative ideas or progress from being made. Some argue that Asia is less prone to innovation than the West, making a clear implication that the west and caucasians have an inherent cultural advantage. That is the story we are told and like all stories, it has an element of truth.

Culture is a technology. As Lawrence Lessig has said, our laws (and culture) are the source code of our society. The laws and regulations determine what we can and cannot do, the method of innovation in society, our interactions and the way we offer opportunity to those who strive to build something better. Culture enables us to interact with each other, it sets societal norms and defines what is acceptable and what is not. Cultural norms and legal systems change for better and for the worse. But, it should be noted that anyone can steal and borrow both our hard technology (plans to a nuclear plant) and our soft technology (culture).

Our culture that lynched blacks, castrated gays, and caused wars and devastation has changed dramatically for the better. Asian culture has and will evolve as well, so we must avoid assuming that the rise of China is a temporary event – inevitably to be set back by the realities of their lack of a liberal democracy. China Economic Quarterly made a point recently that the west has been predicting the demise of China for more than 20 years and that has not yet materialized (thought it does not mean it will not).

Between 1880s and 1950s, many educated and intelligent people believed that the World would move from capitalism to socialism. The tremendous progress made by the Soviet Union and then China in improving the welfare of their people seemed to signal that a centralized and powerful state would beat out a decentralized and less organized Western Democracy. Yet, the revelation of the excesses of Stalin and Mao along with the collapse of their economies laid bare the failures of that system, With the fall of the Berlin Wall, the victory of liberal democracy over communism that was not at all obvious in 1930 or 1950 became self-evident.

But what if we are wrong? What if the Chinese governance model of a strong state and the interaction of government bureaucracy, state owned enterprise and government officials is actually a better model than universal suffrage and representative democracy?

China’s rise is still confounding many researchers. It goes against the narrative that without liberal democracy, a nation inevitably collapses due to corruption and nepotism. Xi Jiping’s 3 and half hour speech in 2017 on growing Chinese power and their preparations to open their economy, invest in clean energy and engage the world would not have been imaginable 40 years ago. His shorter version at Davos hit many of the same critical points. Many western commentators still write it off as a ploy and that the country actually has little intention of doing what it says. The west seems to confuse what we want from what is and this can be a deadly mistake. With 6,8% growth in China and a stable political system that is generally well liked by its people, it is becoming less and less obvious who will collapse first – the West or China.

This interesting talk outlines how the Chinese political machine works:

One of the reasons the West continues to culturally dominate the world is the narrative of freedom and democracy. We can rightfully claim that our rule of law and low(er) corruption levels will carry us in the long term as investors and people prefer to live and be members of a society where they are not subject to arbitrary decisions by government officials. However, our story is starting to show cracks at the seams.

The United States, the most democratic country in the world, has severely overextended itself in the Middle East and its internal infrastructure is crumbling. Additionally, its continued problems of racism and the mass imprisonment of millions of its citizens is undermining its ability to convince anyone, let alone China, that it has the right political and economic model. The capture of Congress and even the presidency by lobbyists and powerful interests makes it difficult for anyone to believe that the US is less corrupt than the average country. Additionally, the US has lost a great deal of support in the developing world as its proposed solutions for development, offered through the World Bank and the IMF have failed to deliver real gains for citizens. More and more countries are looking to China’s model as an option for development.

Speed of delivery is a core part of the satisfaction of the recipients. From the mundane to the geopoliticical, speed matters. Domino’s Pizza is famous for its commitment to deliver your Pizza in 30 minutes or its free. Despite mediocre pizza, this time limit made Domino’s into a financial success. At the national level, the speed of the reforms politicians deliver is just as important as the type or reforms.

At the U.S. Republican National Convention during the 2012 US election campaign the Hollywood actor and director Clint Eastwood improvised a skit. He stood on stage, in front of the nation and talked to an empty chair. He rambled about the lack of progress and lack of change for the American people. The imaginary chair represented Barack Obama.

At the time, everyone mocked Eastwood for an incoherent speech, but looking back on it may have been prescient. Obama did make progress, but for a few reasons the progress he made was marginal and slow. No significant metric in the US moved significantly – education, infant mortality, social mobility or disposable income. Some people received cheaper college and some people got insurance, but in the grand scheme of things it was too little, too slow to stop the rise of Trump.

Speed is of course a double edged sword. You can move fast in the wrong direction and part of the reason we endorse representative democracy is to avoid fast decisions made by one person that lead to disaster. However, as more and more countries are turning towards the Chinese approach of making big and relatively fast decisions on a 5 year scale and using state tools to accelerate implementation – notably State Owned Enterprises. Western commentators often brush this off as a desire for third world leaders to clamp down on opposition and that China is simply offering them a dictatorship model, not an economic model. However, I think that more and more countries are looking seriously at the type of State Capitalism that China has demonstrated and saying – why should we outsource our projects and thinking to western companies and institutions? We need to build up our internal capacity and remain independent. It is of course much more complex than this, but at a high level, Western development models have hit a brick wall and the past poster children of our development models – South Africa, India and Brazil – have seen their rise stall.

If we cannot deliver economic growth to developing countries, at least we can show them the moral high ground of democracy and freedom, right? Yet, our moral high ground (which was dubious to start with is eroding due to our wars, growing nationalism, refugee crisis handling and high incarceration rates in the US. If the West loses its moral high ground it will be near impossible to counter Chinese political and economic initiatives in the developing world. Countries will increasingly turn towards a Chinese type model of a strong state, large state owned companies and limited individual freedoms and liberties.

Yet, the recurring response to all this is that the West will rise again. That our system of governance, imperfect though it may be, offers the greatest freedoms and the greatest opportunities for individuals to create value for society. That, despite our challenges, we will rise again and hold high the light of liberty that all humans desire. This is a dangerous strategy. Many empires and ideologies thought themselves better than everyone else and then crumbled. The West’s wealth is primarily built on technical innovation (steam engine, …) and a bit of exploitation of people (slaves) and natural ressources (colonies). We are still living of our lottery ticket from 1700 when we invented the steam engine, extracted natural resources and colonized the world. What happens when we use up our winnings?

There is no doubt that an overhanging question that remains for the great Chinese expansion is, “Can you develop a society with rule of law and low corruption within a one party system?”. In concept it would seem not. An independent judiciary requires a political system that is not beholden to one set of people. Yet, the Chinese Communist Party is a party that has changed dramatically in since its inception in 1921. It has gone from a Soviet allied party to the Great Leap Forward that tried some pretty insane things and then to the Cultural Revolution that attempted to put farmers in prestigious universities and now to a form of state(s) directed and dominated market economy that is focused on technology and science advancement. China has shown a tremendous ability to change over the last hundred years. The west has not, though our civil liberties have greatly improved, our political institutions are basically unchanged since 1776.

Political systems aside, there is one trump card: technology. At the end of the day, all other thing aside, the rulers of history had the best technology – the best tools for farming, for production, and for war. As Vladimir Putin recently said, “the country that controls Artificial Intelligence, will control the world.” If the West wants to stay competitive, let alone rule, it needs to dramatically accelerate technological innovation and its deployment into society. We know what we need to do – autonomous vehicles, AI, hyperloops, better food production, space travel – the governments need to have the courage to invest and to act. I fear that our governments do not have that courage, the fear failure more than they believe in the potential for big projects to pay off. If we can say one thing that is without debate, the Chinese communist party believes in doing things on a massive, massive scale. From high speed rail to electric cars and AI, when China decides to go big, it goes very big. The next economic revolution is coming and it is not clear the West will lead.

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Useful articles on China

A Chinese Empire Reborn – The New York Times
Brrr … Xi’s short-sighted pollution policy goes up in smoke
What to do about China’s “sharp power” – Sunlight v subversion
Do you still want to bet against China?
Year 2018 in China
Behind the Fall and Rise of China”s Xiaomi
The traditional Chinese dance troupe China doesn’t want you to see
China’s Top Ideologue Calls for Tight Control of Internet
Maybe China Can”t Take Over the World
Wang Huning: China’s Antidote to Strongman Politics
The Western Elite from a Chinese Perspective – American Affairs Journal
China Busts a $3 Billion Underground Bank as It Tightens Its Grip on Money
China Looks to the Dumb Money for Its Financial Industry
China”s Quest For Clean Air Could Hit You in the Wallet
What a debt crisis in the provinces says about governing China
4 Attitudes of Chinese Young Women Impacting Their Lingerie Preferences | Jing Daily
Pollution curbs set to make skies clearer – China – Chinadaily.com.cn
Air Quality in China: Improving But Still Not Healthy
As Trump turns his back on the world, the stage is set for President Xi | Larry Elliott
China’s Silk Road Illusions
Opinion | Will the Next Steve Jobs Be From China?
We are obsessed with Brexit and Trump: we should be thinking about China | Martin Kettle
Xi Jinping heralds “new era” of Chinese power at Communist party congress
China’s Electric Car Push Lures Global Auto Giants, Despite Risks – The New York Times
The future China chooses will dictate the future of the planet
China encourages environmental groups to sue polluters
‘My job is to clean up the environment. China really wants to do that’
In the shadows of high-rises, Shanghai’s small neighbourhoods struggle to survive | Aeon Videos
“You should consider our feelings”: for Chinese students the state is an extension of family | Merriden Varrall
As Bike-Sharing Brings Out Bad Manners, China Asks, What’s Wrong With Us?
China Should Beware What It Wishes For
Global automakers call on China to ease “impossible” electric car rules
10 Chinese Megacities to See Before You Die
The changing face of growing old in China
Is China Outsmarting America in A.I.?
China”s Asian Dream
World”s biggest building project aims to make China great again
China can deflate the world’s largest credit bubble in an orderly fashion
Inside Alabama’s Auto Jobs Boom: Cheap Wages, Little Training, Crushed Limbs
As Hong Kong Chooses Its Next Leader, China Still Pulls the Strings
China Poised to Take Lead on Climate After Trump’s Move to Undo Policies – The New York Times
China to Plant ‘Green Necklace’ of Trees Around Beijing to Fight Smog – The New York Times
The miracle of reading and writing Chinese characters
Welcome to Yiwu: China”s testing ground for a multicultural city
More than 100 Chinese cities now above 1 million people
“Half these apartments are empty”: Mao’s former home city struggles with growth
China Pushes Legal Overhaul That Would Bolster State Power
China’s Plan to Build Its Own High-Tech Industries Worries Western Businesses – The New York Times
Chinese premier declares war on pollution in economic overhaul
China builds world”s biggest solar farm in journey to become green superpower #GlobalWarning
Out of China’s Dusty Northwest Corner, a Solar Behemoth Arises
China”s premier unveils smog-busting plan to “make skies blue again”
Beijing is replacing its entire taxi fleet with electric cars to fight pollution
Gas-to-electric cab conversion in Beijing brings opportunity worth 9 bln yuan
Elon Musk reaffirms UBI prediction at World Government Summit | Basic Income News
China”s Outstanding B2B Invoices Grow | PYMNTS.com
Selling your software in China
What’s Causing Those Capital Outflows From China: QuickTake Q&A
China “eliminating civil society” by targeting human rights activists – report
Why Europe Is Warning of Pax Americana”s End
How Xi Jinping”s global ambitions could thrive as Trump turns inward
Getting Money Out of China: The Reality Has Changed | China Law Blog
SaaS in China: The 101 | China Law Blog
Selling Software as a Service (SaaS) in China
Foreign SaaS in China: Get off of my cloud
Is Your WFOE in China Optimized? Find Out Where You’re at Risk of a Crash Landing…
Watch Out For Saas Startups in Asia[:]

[:en]Business Books for Scaling Up a Successfulish Startup[:]

[:en]When I started Nimonik in 2008 I had read some key books on business and software. Nimonik is my main occupation and our stated goal is to Improve the world by helping businesses comply with environmental, safety and quality regulations. We offer a software as a service and now help over 500 companies track and comply with both regulations and internal standards. Though we are doing well, the company is still in its infancy.

Many of my friends think I know what I am doing and they ask me about their business ideas or how to get started. To help, I thought I would discuss a bit of the knowledge I have acquired and that now helps Nimonik grow sustainably. Ten years ago, I blogged that books such as Good to Great and Getting to Yes were respectively helpful in understanding leadership qualities of great CEOs and negotiating tactics for getting deals done. Both of those books were critical to what we have done at Nimonik. Another key book that helped us start was the 37Signals book on developing software, Getting Real. The book and blog posts by 37Signals came to my attention prior to starting Nimonik and they had a major impact on our choice of the programming framework Ruby on Rails and our approach of building clean and focused software based on the user’s real needs. For anyone looking to start a software project, I think Getting Real is a critical book to read.

10 years after I first blogged about Good to Great, I have learned a lot and made many mistakes. Starting a business is one thing, growing it is way harder! Nimonik was a tiny and fragile operation between our start in late 2008 and 2013, we were focused on securing key clients and slowly growing our operations and our product. In retrospect, we probably underinvested in the company and this hampered our growth. When we started, my two partners and I put in $25,000 and started with two clients who provided revenues of about $40,000 per year. However, the counter point is that had we taken in more investment, we likely would have wasted more on the mistakes that we did make. Who knows!

Starting in 2013, the company started to pick up steam and we have seen a doubling of revenues nearly every year since then. In 2016 we acquired a Toronto based company that was both a supplier and a competitor and in 2017 we acquired a company in China that had good market penetration there. Both of these deals were primarily equity swaps and the book Getting to Yes and its companion book, Getting Past No, were instrumental in our negotiating tactics to obtain a fair deal for all the parties involved. This KMPG webcast, Why most Acquisitions Fail has been very helpful for our integration of the two companies we have acquired. These books were all critical to keeping us alive, but growth was another challenge.

Starting in 2015-2016 we started to have growing pains. Staff turnover was higher than we wanted and team members were struggling to adapt to a small organization that was growing. I must admit that I was underprepared for growth and struggled to figure out what type of leadership I should offer, what I should prioritize and how I could delegate responsibility. Happenstance is a critical part of life. I regularly play hockey and though I must admit to being a fairly poor player, I believe that everyone (and especially entrepreneurs) should engage in regular team sports – it really helps clear the mind and it sets a weekly pace with regular games. One day, in the hockey dressing room one of my teammates mentioned an entrepreneurs club he was part of and I explained some of my challenges. He recommended a book, Scaling Up.

I read the book fairly quickly after the meeting and it opened my eyes. For any entrepreneur who wants to grow their business, I cannot recommend it highly enough. In contrast to many business books, Scaling Up is very actionable and clearly explains the four critical parts of a successful operation.

1.  Attract and keep the right people : People

2.  Create a truly differentiated strategy : Strategy

3.  Driving flawless execution : Execution

4.  Having plenty of cash to weather the storms: Cash

Though we have not yet implemented everything in the book, we have clarified our mission, our values, improved our cash position and improved our retention by leaps and bounds. There is a good summary of the book here. Through the Scaling Up Newsletter (which I very highly recommend), I was put onto other critical books.

Confessions of a Pricing Man is an amazing view into the world of pricing. At Nimonik, we feel regular pressure from certain clients to reduce costs and with other clients we see opportunities to offer more services at higher prices. Our challenge has been how to price our services to maximize our profit and minimize lost opportunities. This book is a must read for anyone running a business. If there is one message it hammers home, over and over again, it is that you must focus on profitability – not revenues. This same message was passed along to me by one of my uncles a few years ago.

My uncle was a mid-level manager at a company in France. The company built and sold systems for train navigation to the French national railway company (SNCF) and to many metro systems in France. He worked there for many years and at a certain point, the owners of the business wanted to retire. It was a family owned business and my uncle, having been a manager and having raised a family did not have a large investment fund he could use to acquire the business from the owners. However, he had made a critical insight into the business, the French rail and metro companies were tied to this supplier. This supplier’s products were the best on the French market, having been developed by the French military and it would be very challenging for the French rail companies to switch suppliers. This meant that the rail navigation supply company he worked at had pricing power which it was not using. My uncle ran around and gathered as much money as he could and even then it was not enough. He explained to the widowed owner of the business that he could not pay the price they wanted, but that he could pay out of future earnings. Remarkably, she agreed.

After the acquisition, my uncle simply went to their customers and informed them of a substantial price increase. Of course, they objected and fought. He held firm and informed them that they could simply purchase other products if they wished, knowing full well they could not easily do this. Eventually, the customers agreed and overnight, the business became highly profitable. He then went on to sell the business a few years later and he intelligently played two potential acquirers against each other. He leveraged the French-German rivalry of the acquirers to get them to outbid each other and he increased the purchase price of his company by over 50%!

Of course, this all sounds very easy in retrospect, but it took good timing and smart moves. He had worked at the company for many years and so he knew the industry and the owners, he was at the right place at the right time and he had the courage to increase pricing overnight. My uncle always told me, “Profits are all that matter, not revenues.”. Confessions of a Pricing Man propounds the same message and offers fascinating examples of different markets, businesses and strategies to improving the profitability of companies.

The last book to mention is Mastering the Complex Sale. This book outlines what it takes to make sales to large companies with committees, competitive bidding and complex and imperfect decision making processes. At Nimonik we sell mostly to mid and large organizations – L’Oréal, FedEx, Bosch,… and though our contracts are relatively small – $5,000 – $80,000 per year, we are faced with complex decision making and conflicting priorities from our clients. Our sales strategies and tactics have been developed mostly by trial and error and gut feeling. We tried more and less aggressive tactics, more or less phone calls, more or less email, and a variety of permutations in between.

To date I have been responsible for most of the larger deals we have signed at NImonik and as I tried to scale our sales operation I kept hitting a wall with the sales team. They could land smaller contracts, but the larger, more complex contracts kept coming back to my desk. It was partially domain knowledge, but I could tell it was more than that. I tried training, explaining and doing problem shooting with the sales team, but it did not stick. They kept asking me questions like, “How do I gain the client’s trust?”. This question baffled me, I would simply reply, “By being trustworthy!”, but that was not enough. We needed a how-to guide for the sales team.

The book, Mastering the Complex Sale is the best framework for larger complex deals that I have found and we are starting to implement it at Nimonik. Here is an excellent summary of the book here, which states,

A smarter way to sell transforms the conventional sales pitch that customers must endure into a high quality decision-making process that customers value. It transforms salespeople from predators into valued business partners in the customer’s mind. It transforms the sales process from premature presentations to a process of mutual confirmation. And it transforms the conventional solutions-based, seller-first approach to sales into a diagnostic-based, customer-centric approach. In fact, a smarter way to sell, Thull [the author] persuasively argues in Mastering the Complex Sale, is to stop selling in the conventional sense and adopt a practical proven approach called Diagnostic Business Development (or the Prime Process).

There are other great business books that I have read recently, such as Double Double, High Output Management, Only the Paranoid Survive and Epic Content Marketing. However, if you are in a decision making position at a company, whether it is your own or someone you work for, I think that the three books mentioned above are the most powerful and actionable business books I have found so far. My colleagues, who completed MBA programmes at prestigious schools agreed that they probably could have skipped MBA school and simply read those books – it certainly would have been a lot more cost effective!

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[:en]How to Save the World – Liquid Feedback, Basic Income and More Politicians[:]

[:en]Canadian Prime Minister Justin Trudeau recently announced he would not be reforming the electoral process despite making a very clear and unequivocal commitment to do just that during his most recent election campaign. He said, “election will be the last federal election using first-past-the-post.” But we all know campaign promises are meant to be broken, silly rabbit! Trudeau claimed that there was no consensus concerning the type of electoral system we should put in place and there was not enough momentum to change the current system. While both points are true, I believe the real reason he did not move forward with the change was simple: the return on investment was not there.

Parliamentary Westminster democracies and Republics are broken in too many ways to count. Political journalist Andrew Coyne wrote a great piece in the Walrus outlining the accumulation of power in the prime minister’s hands and the disempowerment of members of parliament, and therefore citizens, over the past century. He dives into more detail in his recent talk (“Our Broken Democracy“) and even proposes some solutions to our situation. He chalks up the failure of Canadian democracy to things like the nomination power that the Prime Minister has over each MP (the PM can choose not to sign the MPs card and thus disqualify the person), the nomination of judges and many other government positions, the lack of proportional representation and the tight party lines that are enforced by the whips and the prime minister’s office.

While Coyne’s points are valid, he makes a most common mistake: he is reasoning from analogy, not from first principles. His proposed reforms to our system assume that our system has the correct foundation and that Westminster parliament is still appropriate to our situation. Nearly all of his proposed solutions exist in other democracies in some form, Germany has mixed-proportional representation, the US elects its judges and France does not hold to party lines. The system is broken and Coyne is is trying to put Humpty Dumpty back together with pieces from other democratic systems.

Changing an electoral system is a huge undertaking, it requires discussion with civil society, bureaucrats, politicians from different levels, societal education and much, much more. I cannot think of any country that has made a significant reform to its electoral system outside of a seismic event such as an economic or political collapse. The reality is that any electoral system we could imagine – within the realm of the existing systems – is just not that much better than the current system. Preferential voting, mixed proportional, proportional or something else might improve our ‘democratic performance’ by a couple percent (whatever that might mean) – but the cost to implement the change would be massive.

As I discussed in my 2012 TEDx talk, Canadian democracy needs much more than a fresh coat of paint. We are talking about a system that was designed before electricity, the internet, cars, trains, and planes. The US Republican system, as an example, still has a number of procedural rules that are based on the travel time by horse and buggy to and from Washington D.C.! Coyne and many other democratic reform activists seem constrained by their assumption that radical change is not possible or desirable. Or perhaps radical change – that is, attacking the root of the problem – does not even enter their train of thought. Who knows.

Four Critical Books on the Structure of Society

A great book I read a couple years ago is A People’s History of the World by Chris Harmen. The book charts the rise and fall of societies from the points of view of the working classes. Written by a self-proclaimed Marxist who applies the lens of class struggle to world history, it covers a wide array of political movements and outlines some of the underlying trends. The book puts in perspective our own system and how much of our democratic institutions were built by the male and older middle-upper class to allow them to retain control of the system, while appeasing some of the democratic demands of the people. The systems put in place in the British, French and American revolutions were done to ensure an orderly transition from kings and queens to a political elite that could be controlled by the same, but slightly larger, entourage.

A book that goes well with this one is David Graeber’s Debt, which charts evolution of debt in society. Debt and the way we treat it determines much of our social fabric. Who owns what is largely determined by who owes what. This essential book compares societies around the world and across time and proposes some radical changes to our current financial framework. I cannot effectively summarize this masterpiece, but you can read the short essay that David Graeber wrote himself. If the book does anything, it shatters your view that the system we have today is inevitable or ideal. Debt and our indebtedness through mortgages, credit cards, medical debt and student debt is a massive burden on society that is killing the potential of billions of people.

The trend of accumulation of power in the upper classes has come back to the forefront with the blockbuster book, Capital in the 21st Century by Thomas Picketty. The central thesis of the book is that when economic growth is less than the return on capital, wealth moves towards the top of society. That is, a worker who is basically riding economic growth through wage increases can never catch up to a person who is earning their revenues through return on capital. The historic norm for return on capital, most of which is housing, is 5%. So growth below that leads to an accumulation of wealth at the top. Of course, the book outlines the case and the structure of capital in a much more detailed way that we should all try to understand. Growth in the west is currently just above 2%, but between WWI and about 1970, it was near or above 5%. Coincidentally that period saw the rise of the middle class, free education, universal healthcare and massive technological innovation.

We have now returned to a situation where owning a building is potentially more lucrative than riding on society’s innovative capability – this is a dangerous situation. Since wealth (specifically capital that can be leveraged or become liquid) is simply a storage unit for power, we seem headed towards a return to a plutocracy of some sort. Despite the common assumption that we live in a democratic society where the government is held accountable by the people, power – both political and financial – has actually shifted away from the population in the past forty years and into an elite of extremely wealthy individuals.

However, over the past fifty years a significant portion of the population has been made docile by television, video games and low cost products from emerging markets. Our own greed and sloth have led us to a situation where the good jobs are gone and the future does not look that great. While the majority of society’s situation has stagnated, our elite accumulates more power and a great deal more money thanks to globalization and the segregation of the supply chain of major corporations. The excellent book The Great Convergence explains how there are three key elements to a society’s economic structure: The movement of goods, ideas and people.

The first pillar, goods, was made much cheaper with the invention of the steam engine, allowing Europe to move its goods to markets around the world. Previously, you could only sell to local shops. The second pillar, ideas, has been made extremely cheap through the Internet and telephone, allowing companies to move their knowledge to emerging, low-cost markets. This has led to a convergence of salaries around the world. The cost of labour in Eastern China is now approaching the cost of labour in the United States. The last pillar, the movement of people has not been solved. It is still rather costly to move people around the wold, but telepresence systems, hyper loops and high speed trains may change that. For now at least, the book paints a clear picture of globalization and the impact it has had on the working classes in the “western world” – basically it has killed a lot of their jobs.

Moving back to politics, which is intrinsically linked to economics, we can see that the political trends around the world are only getting worse thanks to endemic corruption. In the United States, where unlimited political contributions by corporations are a sad reality, the situation is even worse. Super PACS, which allow money to be funnelled to political messaging, have taken over the political system. It is not just the paid advertisements that get set by a wealthy elite, the messaging in those paid advertising and the issues they focus on inevitably get carried over into the “mainstream” press and even the “fake news” sites. Larry Lessig of creative commons fame, is putting together a Super PAC to end Super PACs (TED Talk)). He is trying to raise a large amount money to change the public financing laws. We will see how that works out, I have my doubts. Countries such as Canada have strict donation systems and I am not certain that our political system is significantly better. On a side note, he who must not be named, was elected with a much smaller campaign budget than Clinton. This may indicate something as to the value of Lessig’s initiative.

From what I can tell, the only reasonable remedy to our current trajectory is a dramatic shift away from our current form of governance. If there is one country we should look to for recent inspiration, it would be Iceland. During the 2008 financial collapse, Iceland was plunged into crises due to capitalist cowboys who took out massive loans on behalf of unwitting taxpayers and gambled on the financial markets. During the collapse, creditors came calling and in response to attempts by bankers from the city of London and New York to claim those loans, Iceland nationalized the banks, wiped out the loans and re-wrote its constitution (which was later overturned, but hey, they tried!). While Canadian banks are in good condition, they are continuing to underwrite incredulous housing prices and credit card debt with little hesitation. We will see what recent interest rate hikes have on the market. We might want to have a public discussion on the subject of debt, profits and what role banks have in democratic society. As mentioned, money, the money supply and power are intrinsically linked. You cannot realistically meaningfully reform political power without reforming the capital structure of society. And reforming capital structures is even harder than reforming political structures!

Government Structure

The previous Canadian government applied massive budget cuts to our public broadcaster/educator, cut science research and reduced capacity of Statistics Canada – these are all ways to blind the electorate and future governments. In discussions with people in the current administration, they have pointed out the need to rebuild parts of the Canadian public service and that until this is done, certain policies and proposals have stalled.

With a reduced government, it is easier for to turn to private interests as a solution and privatize “underperforming” assets. You can see the evidence of this shift with the the now common public-private partnerships and the Greek financial crisis. Even in the sensible, polite and peace loving country of Canada, we have let both our provincial and federal governments remove democratic power and transfer it to closed door meetings and financial interests as illustrated by our recent international free trade agreements that were not discussed publicly until they were complete.

In terms of solutions, we need to leave our Westminster or Republican box and return to first principles. If we want a government for the people, by the people and of the people, we should start our thinking from scratch. A simple patchwork of mixed proportional representation, reformed prime-ministerial powers and reformed party leadership powers are not enough to fix our situation. We must think much, much bigger. We are facing massive environmental and economic challenges. The planet is warming faster than ever and countries we once laughed off as uninviting and non-competitive have taken over in technologically advanced industries such as high speed trains, electronics and satellites. In addition to our current problems, our society has stagnated – the United States can no longer send humans to space, a billion people are hungry, we have 27 million slaves in the world and full-time employment at minimum wage is below the poverty line.

A friend of mine once explained that you should wait for new technology to be 10 times or 1000% better before you change your machine. This is true of televisions, computers and other things. If it ain’t broke, don’t fix it… unless you have something that is 10X more powerful.

So in light of all that, we need to think seriously if we can reform our way to a solution or if we need to start talking about a major overhaul of our democratic system. Here are three ideas that might have an impact.

1. Dramatically increase the number of elected officials

With 338 federal MPs, about 100 MNAs per province and a few city councillors per city, it is too easy to control and co-opt the system. In the 1980s British television series, “Yes, Minister” and “Yes, Prime Minister”, the UK PM asks his political advisor for suggestions on how to reform the borough level political system.

She counsels a scheme recently put forward by a Professor Marriott, which would give power back to the people by making town halls genuinely accountable. This involves making each councillor responsible for just 200 local residents, which would then lead to a large local council that would report to a smaller executive committee. Councillors would then be in close contact with those that voted for them — and would have to listen to their concerns. By the end of the episode, the civil service, fearful of losing power to “the people” teams up with power hungry politicians, who think they know better than the average citizen, to convince the prime minister that the idea is ridiculous.

Scientific studies have shown that the average human has evolved to live in a community of 250 people, we are comfortable knowing and interacting with that many people. In ancient times when a tribe expanded beyond those numbers, they would break off and form another group. If one person can only know 250 people then I would propose we should have 1 representative per 250 people. In Canada, with 35 million people that would be 140 000 representatives – they could either be spread out across the various levels of government or we could enforce that ratio of 1:250 for each level of government. At that ratio, Québec would need 64 000 representatives and in Montréal, 6 000 representatives. Not that China is exactly a democracy, but the Communist Party does have 89 million members, or about 1 in 12 Chinese or probably 1 in 8 adults. Their way of functioning is fascinating and merits a closer look. The long term potential of the Chinese system is debatable (as is the West’s), but it is surely working for most Chinese right now.

Getting that many people to have a coherent discussion and make decisions was impossible before the Internet. The German Pirate Party has proposed an interesting solution to the issue of delegating authority in large groups. Their system called Liquid Feedback allows a person to offer your vote on a subject matter (i.e. Environment, Economic Policy,…) to someone else. However, you ca withdraw your vote delegation at anytime!

During election time, because of my involvement in politics, many of my less politically inclined friends ask me for whom they should vote. Many of them would happily hand me their vote if they could. The beauty of the Liquid Feedback system is that you can hand off your vote to someone else, but you can also withdraw it at anytime. So, if you really trust someone on copyright reform and someone else on agriculture policy you could hand off your votes on those issues to people you trust, but if you change your mind or if they change their positions, you can withdraw your vote. Such a system starts to approach a true democracy.

A combination of a radical increase in the size of representative bodies and the delegation of votes with withdrawal powers would make it much harder to lobby and co-opt the system. It would also force many more people to actively Think about public issues and consequently spend less time on items that do not contribute to the advancement of society.

Convince a larger group of people of the merits of a policy, rather than a small isolated group should inevitably lead to policies that benefit more people. To reach consensus in large groups, you actually need to propose sensible policy with facts and reason. Aboriginal groups’ decision making process was restricted due to the lack of a written language (see my post here). Their need to discuss and reach consensus rather than create a policy and enforce it through written directives, was an inspiration for the leaders of the American revolution.

2. Limit the number of terms

The initial concept of representative democracy was that a person would volunteer some of their time to represent their community and then return to their line of work. A true democratic politician cannot be a professional politician, they should be a member of society who wishes to contribute their time, knowledge and experience. I would propose that no representative should be allowed to serve more than two or three consecutive terms. In combination with the increase in the number of representatives, this would result in a tremendous churn of people through the democratic system. Interestingly, China cycles its top members between State Owned Enterprises (Crown Corporations), various governmental departments and actual positions in the party. China also has mandatory retirement ages. This shuffling of the political deck would result in two things – more people would familiarize themselves with democratic institutions and it would avoid the creation of power bases amongst a clique of people.

Admittedly, the downside to term limits is that it can create lame duck situations where civil servants and other pretenders to power know they can wait out a curent representative’s term. It is critical that this not only apply to the President, as in many countries, or else you end up having lame duck presidents while members of parliament or congress bide their time and build up political capital that can reach beyond that of the executive leader.

We have this inherent tendency to reason by analogy. In fact, we should reason by first principles – we should not say, “How can we make the current parliamentary system slightly better through the copying of another system such as mixed proportional?”, we should instead reason by asking, “how do we best represent the interests of society and ensure we collaboratively design a future where we all benefit the most possible in the long term”. A true democratic system would entail more fluid exchanges with policy makers and a larger representation of the population’s wishes in policy making. Part of the solution is increasing the size of the elected body to offset the growth of the number of employees in the public service and the wealth accumulation in private industry, both of which represent important forms of power in society as well as inertia that prevents any change.

3. Basic Income

To be clear, my criticism of our mixed-economy capitalism is not indictment of capitalism in general. Our current framework of liberal representative government and Keynesian policies has succeeded in providing massive amounts of material wealth to the majority of citizens. Despite the fact that many people have been left behind, a visit to a typical supermarket is a friendly reminder of our tremendous wealth. Who is not blown away by the quantity, variety and quality of the food available in your average supermarket?

Yet, most will also agree that society has not completely fulfilled its promise of equal opportunity and justice. How can we affect change that moves us forward? The way society functions is primarily dictated by the distribution of power and capital in that society as described above. The well-known Golden Rule says, “Treat others as you wish to be treated”, but there is a more sinister version, “He who has the gold, makes the rules”. Our current power structure has not changed significantly since the instauration of representative democracy in the 18th century.

In the 18th century and early 19th century, most of the western world transferred power from a land-owning aristocratic class to a body of elected representatives in the form of a Republic (i.e. America, France) or a Parliamentary democracy (i.e. UK, Canada). These representatives are elected through universal suffrage in one elector format or another. Despite the inventions of the steam engine, electricity, cars and the internet – the electoral model for distributing power in society has not substantially changed.

Money is a form of accumulated power. Currently, the vast majority of citizens are trapped by their financial situations. We are tied down by a combination of high property costs, the expense of raising children and overspending due to our consumer culture and advertising industry. Few of us have time to get involved in social change or in our communities. We do not contribute due to a lack of time, but for a lack of economic freedom which zaps our energy and motivation. Basic Income, a movement that is gaining traction around the world, is a potential solution to some of society’s ills.

To change the world, you must change the power structure. Yet, to change the structure within the current structure is extremely challenging. This is largely why it has not happened and why it took revolutions, blood and tears in nearly all countries to affect meaningful change. In his excellent Essay, “Enough with this Basic Income Bullshit”, Nicolas Colin outlines his criticisms of Basic Income. Largely, it boils down to a skepticism that people are willing to sacrifice life and limb for a Basic Income. He says “This is yet another reason why I’m skeptical about basic income: I simply don’t see the movement behind it. It’s intellectually seductive, a lot of people like the idea, but I’ve never met anyone for whom basic income is literally a personal question of life and death.” He is right.

From my point of view, the current electoral system will never implement a meaningful basic income unless a massive crisis hits society. In Switzerland, where a referendum on the subject was held last year, the results were interesting. At firs the elected officials were open to the idea, but once they understood that Basic Income was a transfer of power to the citizens, they unanimously voted against it. The population of the conservative country did vote for it to the tune of 30%, not bad for a first try!

The only type of basic income that elected representatives might support is one that simplifies bureaucracy and reduces government costs. This could be a either a low amount or a negative income tax. In other words, what our politicians might support is a program that transfers power from the bureaucrats to the politicians. As they say, the quickest way to be disappointed in someone is to expect them to act against their self-interest. Expecting our elected representatives to vote to remove power from their own hands is a recipe for disappointment.

Bearing this in mind, the only path to a real universal basic income (or a Citizen’s Dividend as I prefer to structure it) is through a Political Party. A political party must be born that holds at its core that a basic income is a fundamental right that allows for a decent standard of living to all. The party must have a clear net dollar figure and a clear proposal for changing the current tax system. Though they need this issue at their core, this party must not fall into the trap of being perceived as a one-issue party (i.e. Green Party) and must have concrete proposals for all areas of society – economy, environment, family, immigration etc. A basic income political party must rally a variety of actors to its defence, forming such a coalition would be a monumental task – not unlike the work of American or French revolutionaries. It seems the Germans, innovative as they are, have started the first Basic Income Political Party.

Forming a political party whose number one priority is a basic income would allow for a few benefits. First, it would allow basic income advocates and supports to center around a party. It would allow for political donations and related tax benefits to support a group of basic income advocates. And thirdly it would put pressure on existing parties to adopt pro-basic income positions to try and offset the movement.

A friend and well-known activist, Dmitri Roussopolous, recently brought to my attention a little known fact. He explained that most progressive initiatives start at the municipal level, not the national or state level. Accessing power at the municipal level is much easier than at the state level and the formation of a policy or political position at the municipal level is within grasp of a motivated group of citizens. Once established at one municipality, the policy can spread to other cities as it demonstrates it viability. A Basic Income Political Party may be best starting at a city level and creating a basic income at the municipal level through municipal taxes, congestion charges, and tourist taxes. The media attention this would create for the idea and the movement would be significant. Though a basic income at the municipal level would be lower due to the revenues available, it could be a real tool to convince others that it is a sound policy and that it will not lead to mass laziness.

The reality is that civil society is still trying to fight for change using 20th century tools – primarily protests, strikes, unions and other such mechanisms. In our globalized and technologically advanced world, civil society is struggling to compete with complex trade agreements, powerful and addictive technologies, a highly advanced advertising industry and a certain status quo that believes the defeat of communism marked the end of all major political discussions. To truly make an impact in everyone’s lives, we need a solution that will free citizens to participate in public life.

Ancient Greek democracy was based on slavery. Free men of Athens could participate in debate because they had slaves working for them. The slaves took care of the more basic tasks – construction, agriculture, food preparation and transportation. Today, we have the opportunity to create our own slaves through our technological innovations. Thanks to machinery from the steam pump to the washing machine to the airplane, we have and will replace a great deal of our drudgery with technology. Try to do your laundry by hand and you may realize how liberating that washing machine is!

Deep meaningful change can not come from a minority of society. The means of organization and communication of the masses are too powerful for any minority of a society to rise up and seize power. Additionally, due to the international economic system, markets and external relations, any attempt by a small minority of the population to change things will be crushed. As such, the only way to affect significant change in the structure of society is to convince a majority of people to follow us.

We must build an army of people motivated by their own personal interests, the interests of their children and a general desire to improve things. Humanity’s deepest and most powerful desire is to be free. As the late Robbin Williams said, when playing the Genie said in Aladdin, “But oh, to be free. Not to have to go “Poof! What do you need, “Poof! What do you need, Poof! What do you need?”. To be my own master. Such a thing would be greater than all the magic and all the treasures in all the world. But what am I talking about? Let’s get real here, that’s never gonna happen. Genie, wake up and smell the hummus.” No Genie, it is possible.

In my view, basic income is the most direct and powerful way to free ourselves and start a new form of society. A significant portion of society is caught between their revenues and their debts, they must meet their mortgage payments, accept less desirable jobs or compromise their decisions to satisfy their short term needs. If we can free people from short term anxiety and accompanying mental issues, we may be able to free the metaphorical genie from the bottle – and then who knows what will happen. As a side note, perhaps one reason many companies are started by upper middle class people – Gates, Musk,… – is that they have a certain freedom to experiment.

The list of society’s problems are long and complex. The list goes from overfishing, environmental degradation, sectarian wars, economic collapse, to populist nationalists! These issues are overwhelming to any of us and it is far easier to tune out than it is to engage. Basic income would enable us to confront many of these issues as we would free up parts of our brains to think about issues other than short term requirements.

What Next?

Capital structures of society are tightly bound with power structures. Changing one, changes the other. Which head do you tackle first? The answer is likely not easy, but if we can consider the idea of increasing the representation of the people in the power structure, offering a basic income and increasing the churn of elected officials, we should move closer to a society where the average citizen has a better shot at accomplishing their goals and society can make wiser decisions.

The only way to affect such massive change is to fight. In all likelihood, the fight will fail. But, it is worth it none the less. To keep our system and to keep switching from red to blue, blue to red, seems like an exercise in madness. It is challenging to consolidate these ideas into an essay, but the four books mentioned are fascinating and worth a read. If it were up to me, a basic income, liquid feedback and term limits would be the top three priorities for a society. With these three ingredients in place, anything is possible.[:]