And suddenly it’s up to you

I distinctly remember the first time I had this feeling in a professional setting.  I was three years out of college, three years into my stint in management consulting, working for a client who wanted us to do a bunch of regression analysis on piles of data to see how they could respond to the rise of mobile phone service.

[answer: stop running and hiding and burying your head in the sand. Mobile wasn’t going away.  Kinda obvious in retrospect.]

The terrifying bit was discovering that, on that client team and in the small office where I worked, I was the person who knew the most about what kind of analysis we should run – terrifying because I knew I didn’t know enough, and I definitely knew less than the client expected.

In retrospect, since most of the gap in what I knew was technical I should have found a way to find SOMEONE who could help me bridge the gap.  But how to better navigate the regression wasn’t the important bit.  The important bit, the part that sticks out is the “this can’t possibly be up to me” moment I experienced.  I felt like if it was all in my hands then something was massively broken, it was a temporary glitch in the Matrix and we’d soon get back to our regularly scheduled programming.

Because what did I know?

These moments are hitting people earlier and earlier in their careers, because we’re no longer asking people to walk a path or climb a ladder.  We’re starting to recognize that whole industries (music, books, finance, technology, energy, infrastructure, philanthropy, healthcare) are either already unrecognizable or will be within 20 years, so we don’t need young people to master the old tricks of the trade, we need them to reconceive everything.

I can shout that from the rooftops but I probably won’t get you to believe that it all should be up to you, today.

But I bet I can get you to notice the next “this is up to me” moment and have you pause for a second and say, “Wait a minute.  Maybe that’s exactly the way this is supposed to be.  Maybe I’m the perfect person for the job.”

Because you are.

An “intangible” dividend?

So here’s a curious narrative: in the early 1990s, 4,600 poor families in LA, New York, Chicago and Boston were moved from very poor neighborhoods (more than half the residents living in poverty) to wealthier (less than a third of the residents living in poverty).  The hope was this would result in better jobs, higher incomes, and better educational outcomes.

After rigorous, scientific testing, the initiative failed to deliver the desired results.

And yet, in what was described as an “intangible dividend” by the NY times, the recipients ended up significantly, quantifiably happier.  “The improvement [in happiness] was equal to the level of life satisfaction of someone whose annual income was $13,000 more a year.”

This is the dividend that’s called intangible.  Happiness.

Of course it’s hard to measure, of course it is squishy and self-reported, but if we’re ever going to get anywhere we have to have the comfort and confidence to say out loud that things like human dignity, pride, and yes happiness are the whole point, the only point really, and that everything we’re doing is aimed at loose proxies to those results – what could be more real or concrete than that?

Just think how much we’ve punted on this issue, if we’re really honest with ourselves.  We’ve come to a point where we’re saying with a straight face that if we put a lot of money into the impact investing sector and that money realizes a healthy level of financial return then we’ve had success.  That puts us about seven degrees removed from actually understanding if anyone is better off, happier, freer, more proud or connected or more able to realize their potential, if someone is more likely to realize justice if they’re wronged or less likely to fall back into poverty if they get sick.

As a sector we have to have the courage to say out loud that happiness is not an “intangible” dividend, it’s not a silver lining in a program that otherwise failed to raise people’s incomes.

Would that we lived in a world in which the NY Times headline could have been: “large-scale government program a huge success, making 4,600 families happier, healthier, even without increasing incomes.”

It feels like looking at the sun, saying out loud that the whole point is happiness or pride or dignity.  It’s so much easier and safer to look away.

Quiet, and silence

Pay attention, the next time you hear someone speak, to the difference between quiet and silence.  Quiet is the sound of people paying attention and listening actively.  But there are still rustling papers, people still shift in their seats, adjust their clothes or just uncross and recross their legs.

And then there’s silence.  It overtakes the room, covers it up, stills the air.  It is a presence so real that you can’t help but hear and feel it if you’re paying just a bit of attention.  It is stillness.  It is people leaning in.  It is people actually holding their breath.

I’ve started paying attention to when this moment happens, and it seems to me that it is the moment that a speaker steps towards real truths.  This truth can come in the form of honesty, in the form of openness and in the form of vulnerability.  It can be stark or honest.  It is always unadorned and there’s never any showmanship.

This kind of silence doesn’t last long – 30 seconds maybe, because people can’t hold their breath forever.  But if you start to notice it you can start to see what it really takes to get people to listen with their whole bodies.  Truth.

FDR and persistent experimentation

Acumen’s CEO Jacqueline Novogratz shared this with our team last week.  It’s from FDR’s 1932 Commencement Address at Oglethorpe University.

Especially today, our task is to remake the world which we find before us.  We have no other option.

Amazing how wisdom is so timeless.

The country needs and, unless I mistake its temper, the country demands bold, persistent experimentation. It is common sense to take a method and try it: If it fails, admit it frankly and try another. But above all, try something. The millions who are in want will not stand by silently forever while the things to satisfy their needs are within easy reach. We need enthusiasm, imagination and the ability to face facts, even unpleasant ones, bravely. We need to correct, by drastic means if necessary, the faults in our economic system from which we now suffer. We need the courage of the young. Yours is not the task of making your way in the world, but the task of remaking the world which you will find before you. May every one of us be granted the courage, the faith and the vision to give the best that is in us to that remaking!

– Franklin Delano Roosevelt

Not-so-small talk

It amazes me how much time we waste in our effort not to waste any time.

Five, even ten minutes to understand who a person is, where they are today, now, at this moment…there’s no way that you can skip that step and hope to create any sort of real connection in a meeting.

Almost every culture in the world knows this – that you cannot start a conversation before you’ve talked to someone as a person.  Except Americans, of course.  We pride ourselves on “getting down to business.”

There’s wisdom in those old civilities of asking after someone’s well-being, their family.

Two people might be able to strike a deal, but two human beings are needed to create any sort of partnership.

The risks of economizing generosity

Another surprising revelation from Sandel’s book was hearing how some prominent economists think about generosity and civic action.

In Chapter 3 of What Money Can’t Buy, Sandel talks about Richart Titmuss’ The Gift Relationship, published in 1970, in which Titmuss compared the US and British blood collection system.  The British system is entirely voluntary and the U.S. system is part voluntary and part paid.  According to Sandel, “Titmuss presented a wealth of data showing that, in economic and practical terms alone, the British blood collection system works better than the American one.  Despite the supposed efficiency of markets, he argued, the American system leads to chronic shortages, wasted blood, higher costs, and a greater risk of contaminated blood.”

Titmuss goes further, arguing not just against the inefficiency of the U.S. system but its morality.  Paying for blood, he argues, is unfair and corrupting.  It preys upon those not in a position to strike a fair bargain (the poor) when deciding whether to give something as vital and inviolable as their own blood.

Famed economist Kennith Arrow’s retort was striking – all the more so because Arrow was known for his work on market imperfections. He was no free market purist.   Nevertheless, Arrow stated that Titmuss’ argument was flawed on two fronts.  First, Arrow didn’t believe that creation of a market would have negative spillover effects on the voluntary market (my take here is that, for blood, it probably depends on how the two systems are set up, and the impacts could be studied empirically).  More surprising was Arrow’s argument about the risks of a voluntary market, and his claim that if something could be solved by a market mechanism it should, so that ethical behavior could be economized.

In Arrow’s words, “I do not want to rely too heavily on substituting ethics for self-interest.  I think it best on the whole that the requirement of ethical behavior be confined to those circumstances where the price system breaks down….We do not wish to use up recklessly the scarce resources of altruistic motivation.”

To paraphrase Bill Clinton, “this is important, so I’m gonna repeat it.”

“We do not wish to use up…the scarce resources of altruistic motivation.”

Amazing that Arrow could actually write this, and that anyone could take it seriously as a model of human behavior.  Generosity is generative, altruism is an orientation towards the world and a pattern of behavior that creates more kind action, both by the actor and by others.  Sure, it’s not limitless – everything must remain in balance – but one of my biggest revelations is that that shifting my own attitude about generosity didn’t exhaust some small, limited supply, it cracked open a door to a whole different way of being (and no, sadly, I don’t live it every day, it’s a lifetime project).  Generosity isn’t scarce and finite.  Indeed, in its earliest forms, newfound generosity is delicate and prone to being easily cowed.  Generosity can only grow if properly nurtured and cultivated, but if it is nurtured, it blossoms, it doesn’t run out.

Taking a big step back, and thinking about the commodified world we live in, I think that Titmuss has it right.  The risk we run, in Sandel’s words, is that “the declining spirit of giving made for an impoverished moral and social life” and that, as Titmuss continues, “It is likely that a decline in the spirit of altruism in one sphere of human activities will be accompanied by similar changes in attitudes, motives and relationships in other spheres” and that ultimately we might undermine altruism and a sense of community.

As Titmuss concludes:

The ways in which society organizes and structures its social institutions – and particularly its health and welfare systems – can encourage or discourage the altruistic in man; such systems can foster integration or alienation; they can allow the ‘theme of the gift’ – of generosity towards strangers – to spread among and between social groups and generations.

What does a society look like that encourages the altruist in all of us, that fosters integration?  Certainly it is one with strong communities and groups, a sense of connection and of shared responsibility.

Harder still, how does one measure and track the supply of altruism, of generosity, in a society, and is there a risk that as market efficiencies populate every corner of our economic and social interactions, that the notion that one would do anything for anyone “for free” would become such an alien concept that it would erode the very fabric of society and the underpinning of strong communities?

(BONUS:  the nice folks at Macmillan Audio reached out after yesterday’s post to let me know that there’s an audio version of What Money Can’t Buy.  Here’s a clip.)

What Money Can’t Buy

Harvard Professor Michael Sandel’s recent book, What Money Can’t Buy, is a critical look at the commoditization (economification?) of everything in our society.  We’ve gone from a world with first class and coach tickets (which, to Sandel, apparently was mostly OK) to a world where people pay for blood, pay second graders to read, pay homeless people to stand in line to hold spots for public congressional hearings, and pay people to tattoo advertisements on their foreheads.

The book is long on questions and short on answers – the central question being whether the potential utilitarian improvements that result from market transactions (both sides participate, so both parties must be better off) is corrupting to society as a whole.  As Sandel puts it, “In deciding whether to commodify a good, we must therefore consider more than efficiency and distributive justice.  We must also ask whether market norms will crowd out nonmarket norms, and if so, whether this represents a loss worth caring about.”

Sandel argues forcefully that in order to resolve these questions we need to get comfortable having normative discussions about the kind of society we wish to create and live in – and I was longing for a last third of the book that would equip me as a reader with tools to have those conversations.  That critique notwithstanding, it’s impossible to read the book and not start to notice how everything (everything!) seems to be for sale, and the prevailing wisdom is that this has to be a good thing.

The counterargument is that putting a price on things crowds out civic behavior.  The moment you offer $50 to people to give blood is the moment people stop showing up to donate blood out of a sense of duty and generosity to their fellow man.  As a wise friend of mine once said, “I’ve considered donating a kidney, but I’d never consider donating a kidney and getting paid $500 for my troubles.”

With this as context, I wonder if part of my interest in generosity was a backlash against everything being monetized and maximized – a desire to create a space in my life, connected to a sense of service, where market norms don’t prevail, where I act from a sense of duty first.

Duty means you don’t get to ask clever questions…you just act.  And these days, just acting is a welcome respite from the Chase review of line calls at the U.S. Open, the football games at Invesco Field, people buying the future income streams of young people instead of just finding great people and giving them our support.

Even in impact investing there’s a quiet whisper (getting louder every day) that if it something has a market-based solution then it HAS to be better.

Maxims are nice because they make the world simple and they ask little in the way of judgment and nuance.  But let’s just be clear: markets are great at efficiency, markets instill discipline, and markets give us quick feedback.  But the premise never was that markets alone have all the answers, and if we as a sector are going to make large-scale change, we need to learn the lessons of history – today’s (read: 2008 crisis) as well as yesterday (the building of the U.S. interstate system) – of where markets have worked and where they haven’t; what are their strengths and what are their limitations; where markets empower and where they marginalize.

The lines aren’t bright, but there are important lessons out there, and most of them weren’t written by Milton Friedman.  As our sector grows up, we will all have to start becoming better students of history, and becoming more versed in talking about where markets work, where they don’t work, and why.