 Trust is cheaper than control. Welcome to part three. I hope you've watched parts one and two. These all build on each other And I want to go straight to the heart of capitalism and say look but in capitalism there is trust, right? Money is a mechanism for creating trust at a distance. You give me a dollar I have a dollar that I can go spend somewhere else It doesn't matter who you were so much the dollar helps Markets create trusted places for exchange and enlightened consumers a word if you've watched me elsewhere I can't stand go where they want and get what they need this whole system Creates a way that people can kind of trust each other and coexist well I'm taking a pretty different angle to this these things are Sort of true, but really broken But what I want to say is that capitalism as a structure Forces what I call design for mistrust and forces companies to mistrust the rest of us part of what's doing this is profit maximization the absolute squeeze on profits Wall streets short-term mentality. There's really good books recently about short termism Why don't we have any long-term thinking anymore? But the pressure for profit maximization an idea that is being debunked as we speak very beautifully Leads to a lot of this it squeezes managers to go do the kinds of things. I'm going to talk about here such as Overprotecting their intellectual property Small example, do you know what the original copyright term was how long copyright lasted? It was 14 years from the publication of the work renewable only once Statute of Anne 1710 England we kind of copied that and then we we kept expanding and expanding is expanding it and today Do you know what it is? per corporate works it's 95 years after publication of the work and Everything is copy written by default. You don't have to apply for it In the old one the original one it was 14 years You could only renew it once and you had to apply So that's just an example of what corporations have done how they kind of own our government to create a really favorable world for themselves Ignoring the consequences of what they're doing because overprotecting intellectual property is a terrible thing for humanity actually So all of this in the quest for a sustainable competitive advantage Which is sort of code-speak for an unfair competitive advantage? Nobody loves competitive advantage like a monopolist or maybe an oligopolist. So companies really seek that There's so much in incredible market pressure for just more stuff If you have a great quarter if you knock that, you know If you knock it out of the park and your numbers are better than they expected that just resets the bar at zero Now you've got to deliver more next time large companies need to continue to grow at incredible paces Nobody can really be sustainable. Nobody can really be consistent and be rewarded by the present marketplace Wall Street hates Consistency they really want overperformance in the middle of all this we have Incredibly exorbitant executive pay. There's this myth that this is the only way to get these great people to run these companies Mostly, that's not true. These are not such great people They rose to the top of organizations that are very efficient at sucking money out of their markets So as a result you have short executive tenure the companies have very little liability for their externalities Because there's not enough regulation not enough other things and the companies take very little responsibility for the commons that they touch That's starting to change Here I'm being stereotypical about capitalism There's a lot of enlightened companies out there that are breaking many or most of the bullet points on this page But but this this is the stereotype and and still the major market moves this way So they take little responsibility for commons. They have very few long-term incentives all of in fact all of the long-term Ties have been snipped. They've severed the long-term relationships that used to mean they were in Relationship with their clients with their communities with the commons with the government those have mostly been snipped very efficiently So what we have is a world where short-term incentives rule. I want to give you two examples I want to talk about agriculture and entertainment both very large businesses. So what are capitalism's effects on agriculture? Well, we end up engineering plants that don't reproduce the Monsanto's Terminator gene and then Plants that are not Susceptible to pesticides so they are roundup ready another Monsanto gift to us so that we can spray pesticides all over the crops We then pass legislation to protect all of our intellectual property We sue farmers who violate our intellectual property even if it's unintentional So pollen blew over from the crop next door which had bought some Monsanto products pollinated some of our field People come on to our land test our crops discover that and sue us out of existence We sue the seed cleaners out of existence There there used to be a dozen or two guides with with rigs on the back of their trucks Which would clean some of your seeds so that you could keep some of your seed to plant for next year This is the way agriculture has been for the five thousand ten thousand years We've had agriculture you keep some of your seed to plant it next year But no no no because we want plants that don't reproduce so you have to go back to the well and buy more from your supplier We get rid of the seed cleaners. How efficient is that? We also buy up the seed companies so we can control the stock We then have a problem because there's unintended consequences at every corner of this stupid mechanism We get superbugs that are resistant to our pesticides so we have to change and reformulate We get monocrops would become very fragile Along the way we make life really really hard for small farmers because the profits just get sucked right out of farming and worse We make agriculture fragile. We destroy the soil. We make the entire infrastructure really endangered a company like Monsanto That that I think workers at Monsanto think they're feeding the world and I don't understand how they work there given everything I've seen about the company This thing this then requires therapy for everyone involved a little tongue-in-cheek and my poster child here is Monsanto There's clearly other companies in this business but this is the large company that has really run the table in agriculture and is Endangering agriculture and our planet as we speak that's a cost and It's all about control You'll see I've just tried to name some of the ways in which companies like Monsanto are busy trying to control agriculture and the food system and There's plenty plenty more so these are costs that don't fit neatly into the previous presentations I did which is why I'm going there here, and I know it's it's sort of a hard luck message for capitalists I think capitalism can be fixed but not the consumer mass market capitalism that's fixated on profit maximization that we are steeped in today So let's switch for an instant to entertainment Which was once called culture. We used to sing with each other We used to tell stories around the campfire. We've basically industrialized the whole thing We've borrowed folk tales and prior art and here my poster child is Disney And I will disclose to you that my first real job in the world was at the Disney in Anaheim The Disneyland the original park I was a guide on the jungle cruise So I did work that two winters and one summer season had to memorize a spiel got to shoot hippos with a nickel plated Smith and Wesson 38 a part of the ride I'm sure is gone now, but Disney Walt borrowed a bunch of folk tales and prior art and then turned them into his very famous movies He built a huge base of IP assets, which then of course he went on to over protect them He went on to pass legislation Well, not Walt directly, but his descendants to protect his IP like the copyright term extension act the digital millennium copyright act and Worldwide treaties the world intellectual property organization the world trade organization whose major roles are basically to force everybody to Adhere to these overprotected rules He then force Disney then forces the in the PC industry Disney and other companies But the copyright industries force PCs to bake in copy protection schemes There was plenty of controversy about this in the 80s and 90s Intel Microsoft being the the principal sort of enforcers of these sorts of things And we're trying to mold good consumers along the way But in fact what we do is we denude the commons the commons of culture winds up being swept clear Things that need to exist and freedoms we need to have to remix culture and make things happen Fortunately mixing and remixing is damn easy and it's really hard to prosecute so people are doing it left right and center But the legal infrastructure if we actually towed the line and paid for copyright permissions and solicited permissions for all the things That we do we could not exist in that world and again the poster child here is Disney the tragic kingdom This is trust is cheaper than control part three Capitalism and trust sorry if it was bad news the next section will be about commons and community This is part of a larger work on trust which is part of a larger thesis the relationship economy I'm Jerry McCalsky to die deeper either go to Jerry McCalsky comm or just subscribe to this channel here on YouTube I'll be doing more of these videos Thanks for your attention