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I opened an old leather-bound register in the archives of my employer, the Bank of California. An entry in March 1906 showed that my grandfather had taken out a commercial loan for $5,000. The rest of the line was blank. Grandpa Henry never repaid that loan.
Nearly all of us live in the world of commerce. The surface wave of commerce began several thousand years ago. It grew rapidly a hundred years ago; now our lives are engulfed in the tsunami of commerce. Today, the words commerce and modern world describe nearly the same thing. Neither can exist without the other. The tsunami of commerce created our modern world. The term commerce, as used in this book, means more than the word business. Commerce is broader because it includes barter. Barter is commerce, but not business. Businesses can succeed
© Copyright 2004 Michael Phillips
or fail. Commerce and only be suppressed. Over the past century, communist governments disbanded businesses and tried to eliminate commerce, but communism never succeeded in burying it. When I visited Moscow in 1981, commerce was alive and well in nearly every alley, offering souvenirs, currency and sex. Business can be destroyed but commerce can’t. Commerce is a unique system that contrasts with: the military, the arts, government, the intellectual world and religion. Each of these provinces government, intellect and religion - have a different mind-set than the mind-set of commerce. Soldiers, participants in the military, have a different worldview than participants in commerce. Commercial people and the commercial mind are distinct. Business is a part of commerce and nearly all major institutions. Each major institution, such as the military and the arts, has within it a form of business, such as the purchasing of military supplies and the selling of tickets to theatrical performances. To understand and appreciate the modern world1, it helps to recognize the indifference of commerce to traditional morality. For me, the first step in understanding the modern
commercial world was my acceptance of this state of indifference. Accepting the indifferent nature of commerce reduced my confusion about the role of commerce in our existing moral and cultural orders. Technology and science are good models for understanding and appreciating the value of the morally indifferent systems that exist around us. These include technology and science. With an understanding of the morally indifferent nature of commerce we can move on to the second chapter in this book, appreciating the positive values inherent in the emerging commercial world. The third chapter of this book examines the interaction between our individual minds and the commercial world we inhabit. The final chapter of this book examines how commerce thrives or falters within the larger world of politics and government.
Morally Indifferent Technology and Science
Technology seems to fight a never-ending battle with other human institutions because of its indifference to existing morals. In 800 B.C.E., Indian surgeons restored amputated ears and noses and removed tattoos from their patients.
© Copyright 2004 Michael Phillips
the whole moral battle was reengaged. too. even with death. and announced evidence that life on the 4 . Indifferent technology has a neverending fight on its hands. Science. the “morning after” pill. not the instant creation told of in Genesis. the Roman Catholic Church. often gets into trouble because of its indifference to morality.The surgeons. The same strong reaction against science was evident centuries later with the scientific advances in geology and evolutionary biology. In the past several decades. medical practitioners have gotten better at preventing human conception and terminating pregnancy. religious opposition was vehement. For more than a century. were condemned for interfering with the judicial processes and offending the morality of their time. Science proclaimed a long history for the earth. When technology brought the next development in birth control to market. pioneers to whom we are now deeply grateful. The courts had amputated the ears and noses and branded the victims with tattoos as punishment. the Inquisition and many Protestant denominations rejected Copernicanism and punished. Many people today are offended by the use of technologies that allow contraception and induce abortions. and sometimes lethal. When Copernicus determined that the earth orbited around the sun and was not the center of the universe. Copernican advocates. billions of years. RU482.
The values that nourish commerce are fruitful: diversity. insects. openness. many people consider these commercial values positive values. technological bias and decentralization. monkeys and humans. These social values are discussed in detail in Chapter 2. The difference between right and wrong social values is the difference between a lush valley and a sparse desert. The presence of these social values promotes commerce while their absence restrains it. and some parts of it still are. pigs. Commercial Mind © Copyright 2004 Michael Phillips 5 . The prevailing moral order fought back. Social Values Commerce thrives when the right social values are present in a society but it struggles when those values aren’t present. We have a long history of ignoring the positive contribution that commerce makes to our society and its values.earth connected single cells to plants. In general. Many of these social values were in place before the explosion of commerce. markets. trees. commerce has rewarded those societies that have these values. meritocracy.
the unlimited potential for avarice. the rise of irony. the elevation of whim to a major factor in human behavior and the emergence of global commercial behaviors. and what state policies stifle commerce?” Nation states where commerce thrives. Among the many qualities of the commercial mind to be aware of are the fungibility of nearly everything. The State and Commerce We have many nation states on this twentyfour-thousand-mile round planet and we can compare them with each other to see where commerce flourishes and where it struggles.Living in a commercial world promotes a commercial mind in each of us regardless of the extent of our commercial-market immersion. blasé attitudes. the adoption of a managerial perspective in daily life. the triumph of cynicism. such as Singapore. for example. The commercial mind and its impact on our society are considered in Chapter 3. commerce is struggling to reassert itself. In Cuba. Nation states where commerce once thrived but has been almost extinguished also exist. some are neutral and a few may be positive. some we take for granted. Some qualities of the commercial mind are negative. 6 . This surfeit of nation states allows us to answer the questions “What state policies promote commerce. immediately come to mind.
Commerce can’t do well when el presidente can imperiously confiscate a successful business and hand it over to his brother as a gift. Recommending the ideal balance between the extremes of a weak state role in commerce and too great a state role is not what this book is about. over time.Our pool of Nation states provides a laboratory that tells us which state policies promote and which retard it. we find strong arguments that commerce thrives in societies that have diverse populations. • We can take anyone to court to settle our personal differences. © Copyright 2004 Michael Phillips 7 . nor so strong that the state can abrogate these rights. including property rights. and commerce is not simple. Understanding the relationship between the state. We know that finding the right mix of state control and commerce is possible. that value openness and honesty in communication and that place a premium on meritocratic workplaces. Examining a large array of nation states. when interested people perform the right scientific experiments and study the right data. We Americans take a great deal of a successful governmental and commercial system for granted. We also find that commerce can thrive when the state is neither too weak to enforce private contracts. This book aims to understand the reality of commerce. its people.
income tax. We Americans perennially debate tax policy on city. drug use in the workplace and much more. • We are outraged when we think a neighbor got a zoning permit in return for a bribe. we have gone from a world of modest commerce with only a 8 . We fight our battles about commerce and the role of the state at a high level of intensity and vigor. state and national levels. We debate government deficits. and we consider it a social goal to eliminate this type of behavior. This process is just beginning. In the past two hundred years. • A package sent through the postal service that has been opened and pilfered is unacceptable. experimentation and extensive study. excise tax and so on. • We would never let the sheriff’s brother take over our home for his family without compensation. free trade. We debate whether taxes should be progressive or regressive or neutral. Making sense of these state-commerce interactions requires research. We have a never-ending debate on the types of taxes we prefer: sales tax. We don’t have clear solutions. tariff barriers.• We serve on juries that adjudicate contractual disputes for billion-dollar corporations. public education.
few prosperous participants living in a few cities to billions of commercial participants in hundreds of thriving urban areas. that lives a long time and that travels over vast expanses rapidly Our history of commerce has created a large population that enjoys a wide range of emotional comforts and physical luxuries. © Copyright 2004 Michael Phillips 9 . with trillions of dollars in income and luxurious lives that were formerly unimaginable. That change in perspective is the modest goal of this book: to encourage a deeper appreciation of commerce. Some transformations were expected and many more have arrived unanticipated. and from living with high infant and maternal mortality to a very different world. One change of perspective has not occurred in the period since the tsunami of commerce has inundated us. from lifetime travel usually limited to a small radius. healthy. It is reasonable to expect a change in the worldview and personal perspective of the people who have undergone these changes. Two hundred years of commerce has overwhelmed us with a large population that is literate. We have gone from traditional homes shared with farm animals.
Chapter 1 A loan ledger in the Bank of California archives shows that a loan to my grandfather was made in March 1906. Commerce readily delivers illegal goods to any buyer and can reward morally corrupt people with great wealth. In April 1906. The loan was never repaid. © Copyright 2004 Michael Phillips 11 . contraband and slaves. Commerce is indifferent to traditional morals. downtown San Francisco was destroyed by earthquake and fire. It enthusiastically provides immoral products such as drugs. Grandpa Henry Phillips was a dentist practicing in Union Square in San Francisco. My grandfather closed his practice and left the country with my grandmother. Such a moral view leads to confusion in understanding what commerce really is. Indifferent to Old Morality Many people believe that good people are rewarded with money and success.
We need mental tools to understand and appreciate the indifference of commerce. In this chapter, we compare commerce to other morally neutral systems such as technology and science. As we will discuss in Chapter 2, commerce does have positive social values, however. Oddly enough, it is the moral indifference of commerce that underlies its genuinely positive values. One clear way to understand this dynamic is to examine other morally indifferent institutions that have created out modern society.
Beer, wine and whisky are the products of early technology. These alcoholic beverages have been the targets of moral outrage in many societies over the centuries. The same technology of controlled fermentation creates bread and yogurt, which don’t evoke the same moral outrage. In its broadest definition, technology is all human-made and human-organized arrangements of the physical world intended for human use. A chair is an example of technology - from the most rudimentary log
used for sitting next to a campfire to the more complex example of an ejection seat in a jet fighter. Knives and forks, drinking glasses, reading glasses, clothing and shampoo are the products of technology. Each is a human artifact created for human use. We humans have a long history of technology; from making a smooth footpath hundreds of thousands of years ago so our tribe could walk faster and carry large loads, to the undersea fiber optic transmission cables of today, which carry international communication. Technology for human use doesn't necessarily mean for each humans benefit. Technology can be used for both good and evil. A knife can cut a loaf of bread to share with friends or to cut a fellow human's throat in anger or warfare. Because technology can be used for both good and evil it is neither moral nor immoral it is indifferent to morality. The thousands of people who developed knives over thousands of years were driven by countless motivations. The creators of knives were driven by an even greater variety of motivations in selling the knives. The entire venture of the creation of the knife belongs to the morally indifferent history of technology.
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War, murder and a wide range of human inhumanity to other humans are closely connected with technology, from the most rudimentary chipped arrowhead on a spear to a laser-guided missile launched with an eighthundred-pound bomb tip. Selecting a single technology of war and identifying it as evil, doesn’t work. Defining the laser-guided missile as evil does not properly place the missile in the framework of technology. We would be ignoring the phone call to the missile-launch commander, which uses phone technology, the missile launcher made of steel and derived from advancedmaterial technology, and we would be ignoring the fact that the designers of the bomb did their design work in buildings that were the product of technology. Since technology is pervasive, it is not possible to separate out the particular part of technology that is used for good or evil. Technology is pervasively used for both. Technological objects and processes are used in everyday life, and everyday life is filled with moral and immoral actions. An ice cube can be added to a glass of water to give to a sick and thirsty ninety-year-old neighbor. The same ice cube could be used by an indiscreet uncle to serve a ten-year-old nephew a glass of whiskey.
weapons designed to maim soldiers. Opponents of the death penalty can consider electric chair technology immoral while death penalty supporters treat it as an instrument of morality. Moral and immoral refer to social and cultural standards that are not universal.Technology is also indifferent to morals because the humans who make technology don’t have a universal moral system. plant poisons sprayed on marijuana plants to make marijuana smokers ill and the classic electric chair for state executions. The list of examples is long and includes chemical poisons used in warfare. Consider the wide range of technologies that are designed to induce human fetal miscarriage. Some readers would consider these technologies immoral. maybe even virtuous. A great deal of technology is designed for purposes that some people consider moral and others consider immoral. national liberation and "just" wars in Roman Catholic theology. Each of these examples has supporters who consider the particular technology moral and others who consider them immoral. Poisons sprayed on marijuana plants are considered moral by opponents of that drug and immoral by users of marijuana. © Copyright 2004 Michael Phillips 15 . others would consider them moral. Weapons of war are considered moral when used for defense.
Think of a telephone or an automobile. we have gained the ability to move faster. Over centuries. they enlarge our systems of expression and perception. technologies have become extensions of our body and mind. Thalidomide became a morally acceptable drug a decade later when it was found effective in treating leprosy. 16 .a morally positive use of the drug. to communicate over larger distances. Increasingly. Thalidomide was used as a drug for reducing nausea in pregnant women in the mid 1950's -. Thalidomide became immoral to administer when if was found to produce limbless children. to perceive smaller objects and to move heavier loads as well as to work with delicate microscopic objects.A technology can change from being popularly considered moral to immoral and back to moral. These technological extensions of ourselves can be used for moral or immoral functions. Because each seems to be an extension of ourself it is easy to use a phone for insulting someone or helping a friend and to use a car to take a pregnant woman to the hospital for a delivery or get rid of an unwanted cat out in the country. It is best to treat the pharmaceutical technology that developed Thalidomide as indifferent to morality. But the car and the phone are not really extensions of ourselves: They are morally indifferent separate objects.
you have to be willing to drive with an unknown number of Jews and whites driving behind you. "I don't make phone calls for gay men. The same moral indifference of technology is true for the telephone. The telephone does not listen to your voice and say. you might have friends. African-Americans. You wouldn't likely go for a casual stroll in a Jewish or white neighborhood. the technology of traffic does not tell drivers what neighborhood their car is morally designed to drive around in.The automobile works because it is morally indifferent. relatives or clients in these groups and have a need to reach them by © Copyright 2004 Michael Phillips 17 . In most cases. That is why the telephone system works. people with New England accents. The moral indifference of the automotive traffic system is what permits it to operate." The telephone is morally indifferent. people under twelve or people who weigh more than one hundred kilos. While you may not be in any of the hypothetical groups listed above. Thank goodness. in front of you and next to you. The same is true for driving through neighborhoods. But if you want to drive an automobile. Floridians. Imagine that you were an antiSemite or an anti-white Black who would avoid taking a walk with a dozen Jews or half a dozen whites because it would violate your moral code.
We need a morally indifferent telephone system. In China. The lower-status person always came early. Landes in his landmark book Revolution in Time: Clocks and the Making of the Modern World (Harvard University Press. This argument is made by David S. the person with lower status used shadows in the street like a sundial (Chinese streets were usually laid out north-south and east-west) to 18 . to printing presses and paper. If the meeting was set for 11 a.telephone. He studies the absence of clock development in China during the same period at a point when China had many advanced forms of technology from gun power to moveable-type. the time for a meeting was set precisely. 1983).m. Landes concluded that comparing Confucian morality versus European commercial moral indifference yielded the best explanation for the significant difference in the developments in clock technology. A telephone system that would not connect to people based on any belief system (moral or immoral) would not be a useful telephone system. but the social hierarchy within the Confucian system determined the nature of the encounter. Landes reviewed the rapid development of clocks and watches in Europe in the 1500 to 1700's. One of the interesting arguments in the history of technology is that some moral systems retard technology.
more public clocks and. the moral indifference of technology. This arrangement produced a demand for more accurate clocks. which permitted it to operate as if it were in a society of social equals. Landes points out that Europe was developing a non hierarchical commercial system. European businesspeople used clocks so that both parties could arrive at the same time. Galileo © Copyright 2004 Michael Phillips 19 . and the other person came as close to 11 as suited his or her status. Science The first example of the moral indifference of science that comes to most people’s is Galileo Galilei. well before 11. Excommunicated from the Roman Catholic Church in the early 1600s. The technology for clocks and watches was better suited to a morally indifferent system where social class was unknown. We still have the phrase "fashionably late" referring to social-status time considerations.come early. ultimately. for watches. was conducive to technological development. The morality of class hierarchy was an obstruction to technology. where many people had to meet regularly for business and trade without knowing who had higher social status. Middleclass merchants were the first people in Europe to have clocks inside their homes.
refused to renounce the Copernican theory that the earth rotates around the sun. Since science is empirical. Many of the scientific arguments raised in Darwin's day continue to threaten religious moralists in America today. often considered the first great physicist. so that religious authorities would not punish him. Isaac Newton. Science has been in conflict with religious norms for several centuries and has been attacked as a threat to the moral order as a result. Science is often used to prove the validity of some moral point or to disprove it. The Catholic Church viewed the Copernican heliocentric view as immoral and a threat to the teachings of the Church. a scientific proof one day can disappear the next and leave the moral arguments subverted. went out of his way to argue that his scientific work on light. calculus and motion was consistent with existing religious morality. The evolutionary issues raised by the scientific theories of Charles Darwin were considered a direct threat to much of established religion and morality when first published in the mid-1800s. The Inquisition targeted followers of Copernicus. This has been the case for many health claims and many medical 20 .
so often glamorized in the past. The scientific evidence of this was offered as proof of the moral value of monogamy. the morally indifferent nature of science becomes a more comfortable reality. it cannot be expected to support preexisting human moral systems. were actually cheating on their mates. Science works when it is morally indifferent. For many years. Examples of our acceptance are the following: We can read a science journal as if we were the wealthiest or the brightest of people. when science is interacting with a real world. The detailed processes of technology and science and the specific steps in the processes are what we accept. DNA research has since found that the birds. Science is an empirical approach to the world. a world that exists independent of human conceptions. Moral Indifference is Acceptable Technology and science are accepted parts of our society. As centuries pass and more people learn to live with science. © Copyright 2004 Michael Phillips 21 . popular writers argued that a wide range of species of birds were monogamous. As a consequence.discoveries that had moral or immoral values attached to them.
that takes voice commands. seven-foot giant with splotchy skin and wearing a fur coat on a hot day tries to buy a microwave oven in a store that sells microwave ovens. There is no way a commercial transaction will occur or not occur because of the moral values of the individual carrying out the transaction. with the same acceptance (the measurement device accepts us). If the giant has a problem buying the microwave at 22 . If a drug-dealing. whether we are strong or weak. Commerce is Indifferent to Traditional Morality Like technology and science. obese. We can stand before a piece of technology. Being a technologist or doing science involves independent steps and detailed processes that ignore our personal moral status. commerce displays an indifference to traditional morality. the transaction is just as likely to occur as if the person were a mild mannered sixty-year-old matron.We can setup a nuclear magnetic resonance machine in the same way as anyone else. our religious beliefs or our country of origin. whether we are educated or not and regardless of our ethnicity. The neutral mechanisms of technology and science are indifferent to morality. say a measurement device. regardless of our sexual preferences.
Commerce rewards people for reasons that have nothing to do morality. Commerce has no effective mechanism to judge buyers. and the seller can be moral or immoral but the commercial transaction will occur because commerce is indifferent to morality. morally or otherwise. There are neutral non judgmental sellers. and in particular to protect Pacific Bell’s existing residential telephone © Copyright 2004 Michael Phillips 23 . to be found somewhere in the commercial world. Commerce rewards people for their success in commerce. Cruel people can gain great wealth and kind people can be poor. he or she will find someone somewhere else who will sell it.one particular store. invariably. New competitors began entering the West Coast telephone market. Pacific Bell decided to energize their telephone salespeople in order to protect their home market. Example of Commercial Indifference to Morality Pacific Bell faced local competition a few years after the giant Bell Telephone monopoly (American Telephone and Telegraph Company) was broken up. The buyer can be moral or immoral.
who didn’t speak English. and the salespeople became very aggressive. the Vietnamese community and several other minority communities that had large populations that didn’t speak English. When the salesperson found that the owner of the phone.customers. had phone bills with minimum monthly charges of $35 when the phone bills should have shown a monthly $10 charge. fancy TV’s and vacation trips to Hawaii. on the other end 24 . I was hired after an organization of California farm workers noticed that many of their migratory members. The farm workers’ organization phoned other minority organizations and found the same telephone-bill problem in the Chinese-American community. A simple sales incentive program was introduced that rewarded successful telephone sales people with new cars. The minority organizations realized what was happening and went to a public interest law firm2 who hired me. I learned that aggressive telephone salespeople were phoning existing residential telephone customers to sell upgrades to their phone service. I became involved in this because I am an expert witness in legal matters relating to business practices. The sales promotion program was effective.
The company denied there was a problem -claiming the problem only existed in a few thousand cases. The number of non-English-speaking people who had been involuntarily signed up for $35 monthly phone bills when they should have had $10 bills turned out to be more than 700. The denial by Pacific Bell forced the publicinterest law firm and its minority clients to do a survey to measure the extent of the problem. didn’t speak English. three-way calling and several more specialized services on her phone when her bill arrived. The salespeople were correct in assuming that non-English speakers would have trouble realizing that their phone bills were excessive. the salesperson would illegally install the maximum number of telephone services on the line. Pacific Bell could have accepted complaints about their aggressive sales staff and changed their sales practices.000 families. would find that she had call forwarding.of the line. As a consequence. © Copyright 2004 Michael Phillips 25 . That is not what Pacific Bell did. who could barely operate the phone in the first place. This fraud was not itself the result of moral indifference by Pacific Bell. a seventy-year-old Vietnamese widow. caller ID.
is indifferent to morality. Long after Vail was gone. which sells missiles to terrorists to fire at civilian airliners. We are not comfortable with this commercial moral indifference. derived from the moral authority of their founding leader. Pacific Bell vigorously fought the case against them. drugs to drug addicts. irrelevant phone services to aged immigrant widows and sells slaves to whomever wants them. Summary Technology and science succeed in the modern world because of their indifference to morality. Pacific Bell and its parent company had a long history of good corporate behavior. lost. the company became like most other companies: indifferent to conventional public morality. and reluctantly repaid some of the victims of the telephone fraud. Most people are comfortable with this indifference. Theodore Vail. 26 . Commerce. Pacific Bell collected tens of millions of dollars in extra fees.Over the many months it took to detect this fraud and the several years before it was finally heard by a judge.
will nearly always be disappointed if they try to judge the world on that basis. Those who believe that commerce is either moral or immoral. The reality of this five-word statement reflects the way the world works.Commerce is indifferent to morality. © Copyright 2004 Michael Phillips 27 . Our reaction to this fiveword statement has much to do with the way each of us perceives the world. or that it should be moral.
Henry Phillips. a technological affinity and decentralization. Dr. was unable to continue his dental practice after the earthquake of ’06 destroyed downtown San Francisco and his office building burned to the ground. New Commercial Values Commerce thrives when specific social values are present: diversity. An American dentist was in such great demand and so highly valued in the world that he was able to immediately move to Berlin to become the dentist to the Kaiser. meritocracy. He moved to Berlin and built a practice there. their absence retards commerce. The presence of these values promotes commerce. 28 . markets.Chapter 2 My grandfather. openness. Phillips was a graduate of the Dental School of the University of California at Berkeley.
A few decades ago. The freedom to buy condoms without question was not the case when I was growing up. public morality was openly hostile to the country’s gay population. That was morality intruding on commerce. I don't have to explain my sexual plans. Sunday business was closed in nearly all of America due to Blue Laws up until the late 1960s. condoms were kept behind the counter in drugstores. At the same time. Buyers had to ask for them and at all times be prepared to answer intrusive questions about their sex lives. The tyranny of a pietistic rural majority governing urban lives over the past century © Copyright 2004 Michael Phillips 29 . when I was growing up. Young people were often refused the sale or lectured on the purchase.Moral Indifference Can Be a Positive Value If I walk into a drugstore to buy a pack of condoms I don't have to answer any questions from the salesperson.
These are all the triumphs of commerce over traditional morality. Today. but it will be a while before Americans can buy alcohol legally in bars at times that 30 . In most of America today. clothing and alcohol to gay men. Commerce triumphed to sell hardware. Commerce has won much of the public battle about retail store hours. among other neighborhoods in the United States. caters to gay men. such as the Federal encouragement of the monopoly of druggists on dispensing drugs and their practice of secrecy. But commerce continually struggles in its efforts to be unrestrained by traditional morality. Condoms are sold legally in the open and San Francisco’s Castro District (pictured on the cover). stores are allowed to open on Sundays and stay open twenty-four hours.was humiliating and in many ways disgraceful. The forces of morality have also been visible in the form of government enforcement of restrictions on commerce. morally indifferent commerce has triumphed. traders never respected the demand to stop business on the sabbath and the demand to stop carrying on business late at night. Retail stores are now open even at night and on Sundays in the United States. Commerce never stopped violating the established Sunday sabbath. Commerce triumphed to sell condoms to whoever wanted them.
Erotic.suit customers’ desires. throughout Europe. Docks and dockworkers have been the vehicle for forbidden commercial products to enter commerce for centuries. The vigor of indifferent commerce is most evident when we look at the way illegal products and services entered our society from the outlaw sector to become mainstream commercial successes. Tobacco came to us from the illegal smuggling of dockworkers in the 1600s. Commerce can be counted on to move smoking bars underground for a time and one day. The evidence for the moral indifference of commerce is even more convincing when we look at our history. When tobacco and coffee became legal. Tobacco and coffee were both illegal imports in most of Europe for more than a century in the 1600s and 1700s. they often became government monopolies. and tobacco is still a government monopoly in some countries. to bring them back to the legal commercial realm. Bars that allow smoking have been suppressed and are now a relic of the past in much of America. pornographic and antireligious books have been sold clandestinely by underground © Copyright 2004 Michael Phillips 31 . which was smuggled by dockworkers into the urban surroundings of a variety of ports. The same is true for coffee.
The actions of Shell were 32 . most countries imprisoned publishers and sellers of Baruch Spinoza’s philosophical works. 'rum runners' brought Americans their beloved illegal alcohol during the 1920s Prohibition Era.1 The triumph of commerce in connecting underground suppliers with willing buyers of alcohol has been a reality for several centuries.commerce for centuries. In the mid 1960s. Spinoza’s works were. amphetamines. Royal Dutch Shell secretly sold oil to Israel. Government pressure on large corporations has failed to deter commerce. Most recently. centuries later. cocaine. No amount of government enforcement seems to stop commerce from delivering to people whatever they are willing to pay for. The same is true of Mark Twain’s widely circulated nineteenth century scatological tome. In the early 1700s. Now. ecstasy and so on. Commerce continues to bring us other illegal drugs: marijuana. recently found in numerous eighteenth century libraries in Europe. The illegal underground was extensive even in the most repressive countries. heroin. we know that most important private European libraries had good collections of clandestine. all the Arab oil states threatened to stop oil sales to any oil company or nation that sold oil to Israel. nevertheless.
Sales of pornographic videos rose in the United States from tens of millions of dollars to several billions in a tenyear period. In most parts of the world. Videotapes and portable video cameras became a global market thanks to the driving force of pornography. The video disc was a rapid failure because it lacked the two elements that made the videotape format successful five years later: The video disc could not be used to © Copyright 2004 Michael Phillips 33 .2 The triumph of morally indifferent commerce is also evident in the history of the RCA video disc. Governments were fairly successful in suppressing pornography in the form of books and films. The 1980s saw the introduction of the new medium of home video recorders.moral or immoral. whose images didn’t need to be developed in photo laboratories. RCA introduced the video disc in the early 1970s. commerce continues to thrive on moral indifference. Today. Home video existed completely outside the day-to-day retail world and created an instant medium for pornography that was outside the reach of government. depending on your side in international politics. This technology created an entirely new industry. pornography has been considered immoral and has been illegal. and home video players.
The first Internet search engines found that the number-one or number-two word in searches during the explosive Internet growth years was sex. Shylocks. one entry stands out: interest on money. no way for an underground to get started.make amateur home pornography. For many of the early years. There was no medium for porn. money lender. long historic ledger book of commerce. and the only video discs available were those sold at retail and produced by RCA. In the long. RCA had a strict anti-porn standard for their video disc marketing. and no basis for an above-ground commercial product to succeed. Searching for and finding sex sites was a significant factor in attracting early users to the Internet. The continuing triumph of morally indifferent commerce through underground channels was also evident again for the Internet in its early days. and shortly afterwards the videotape succeeded thanks to the rapid appreciation of the market for pornography (outside the censorship of the government). The RCA video disc failed. The history of the 34 . and a multitude of other terms of opprobrium have been applied to the morally indifferent actors in the theater of commerce. sex and pornography were the largest revenue producers for Internet businesses.
From the eleventh century until the eighteenth century. light hair and light-colored eye pigmentation. Americans still use the term “junk bonds” for high-risk bonds. many Euro-Anglo cultures have been certain of the “natural” superiority of people with pink skin. Yet commerce still makes junk bonds available. governments and moralists ultimately do give up. This was © Copyright 2004 Michael Phillips 35 . Despite the opprobrium of the word sharks.hostility and forceful suppression of interest on money is also the story of the triumph of the morally indifferent nature of commerce. Diversity over Homogeneity and Ethnic Cleansing For the past four centuries. Morally indifferent commerce never gives up its function of satisfying customers. loans were also made to those who needed them despite official antagonism. high-interest. not just in Islam but wherever the interest rate is high because the risk is high. Much of the historic hostility to money lending remains in the world today. high-risk personal loans continue to be offered by commerce. Loans were usually made to the kings and aristocratic elites who most vigorously suppressed money lending. “Loan sharks” make high-interest personal loans.
Commerce has had little or no truck with this view. the Lebanese and the Indian Gujurati. Southeast Asia. the African coastal tribes (Fulani. created the world's second-largest economy. the people formerly labeled “copycats” and “slave laborers. their presumed moral inferiority. and many “dark” ethnic groups have been successful in the world of commerce. The notable successes were the extensive commercial markets created by the overseas Chinese. cultural and mental characteristics.” Diversity is the word that describes the mingling of people with differing human physical. or their superficial anatomical characteristics.not a moral ideology. Senegalese and Woloff) and the “dark Mediterranean” people. and outback India to employ the formerly certified “lazy natives. Fortunately for everyone. morally indifferent commerce has no inherent bias against groups of people because of their cultures. Many parts of the “darker world” have successfully sold goods and services to the international commercial markets. just a regular everyday ideological certainty. Later.”3 the Japanese. 36 . Factories and industries of many types have moved to Mexico.
Diversity is a positive virtue in the commercial world. Nearly all commerce began and thrived in urban areas such as the Phoenician capital of Tyre in 600 B.C.E., later in Alexandria, and then in Carthage, followed by Baghdad and Venice. All these cities were cosmopolitan centers where commerce flourished in a diverse population. Baghdad was such a thriving and diverse center in 600 C.E. that it had hundreds of Chinese doctors in residence. Commerce has always thrived on diversity. The traditional urban diversity of religions, languages and ethnicities brought a wide range of skills, knowledge and information to a central urban site, which fertilized exchange. Diversity generated vital partnerships. Partnerships were formed based on unique sets of knowledge and skills of different partners. Traders needed the skills of craftspeople and both traders and craftspeople needed the skills of shippers. Commerce thrived in diversity, and diversity required tolerance, so commerce became a vehicle for tolerance. The urban commercial centers of Tyre, Alexandria, Carthage, Baghdad and Venice were widely known as centers of tolerance. They had to be because commerce brought diverse people together. Adam Smith, the first and greatest theorist of commerce, in his 1756 book The Wealth of Nations,
© Copyright 2004 Michael Phillips
commented on the contrast between religions, which were intolerant and provoked most of the wars in Smith’s day, and commerce, which thrived on tolerance. In trying to see the connections between commerce, diversity and tolerance, imagine you are a Jew or Muslim businesswoman from Alexandria in 750 C.E.; then imagine the difference for you doing business in the countryside of northwest Italy, a religiously and ethnically homogeneous region. You would have been safe in Alexandria, versus being in impossibly dangerous conditions in socially homogeneous northwest Italy.
Openness Versus Secrecy
Commerce has a strong bias toward openness. Commerce entices secrets away from official secret keepers. If commerce were a metaphoric container, it would be too porous to keep secrets. Think about the secrecy problem in a commercial society. Imagine what it would be like if you were running a secret organization and had to cope with international spies. Most secret agencies are government run because a government agency has the authority to legally punish employees for not keeping secrets. The threats of a military tribunal, capital punishment and long prison terms are
necessary to protect secrets, and governments are best at carrying out these threats. If you run a spy organization, your enemies will using sex, blackmail and money to try to persuade your employees to counterspy. People can almost always be bought off. The enticements of commerce are great enemies of secrecy. Very few people want to defect to a foreign country, especially a non commercial country like the Soviet Union or Cuba. The same people will spy on their own country if they are offered enough money. The direct enticements of money to buy secrets are usually the way that commerce displays its bias toward openness. Spies customarily buy secrets from each other and from people trying to keep secrets. That is commerce in action betraying secrecy. Commerce also offers indirect enticements, including job offers, payment of college expenses for the prospective turncoat’s kids, and most often, helping people to start a new business using the secrets they have stolen. In the marketplace, keeping trade secrets is very difficult. Nothing can really stop an employee from moving around in the job market. Employees are expected to keep trade secrets. Ex-employees invariably pass secrets along, if not in the short run, definitely
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customers. understandable and accurate reports by publicly traded corporations. Customers will occasionally see a sale that is not entered on the cash register and customers will guess that skimming is going on.in the long run to new employers. Employees will be the first to figure out that skimming is going on. Everyone who deals with a business can be expected to figure out how the business operates and guess its secrets. The same failure of business to keep trade secrets applies to other operating secrets. This movement has been underway for two hundred years and 40 . complete. Suppliers will be aware that they are delivering more supplies than is consistent with the publicly stated volume of the business. Trade secrets are invariably modified and implemented by spin-off entrepreneurs. Probably the strongest evidence supporting the openness of commerce is the inexorable movement toward more public. Imagine a restaurant that secretly skims a portion of the gross receipts so as to avoid taxes and pay less rent in a lease that calculates rent as a percentage of gross revenue. Almost any industrial process is likely to be copied by a former employee. Suppliers. Commerce is always too much of a multi person effort to keep secrets for long. consultants and advisors can reveal secrets.
In 1900. including advertising. Investors want and need more openness in order to optimize their choice of investments. The New York Times grew from 2 pages of business news and data to 22 pages. The Wall Street Journal was nearly 100 percent business news. The Sears Roebuck annual report grew from one column in a Chicago newspaper to 60 pages with 42 pages of financial data. all required by the norms of corporate reporting. It grew from 16 daily pages about business and business data to 56 pages in March 2000. By 2000. Businesspeople duplicate what they know works in one realm. The reason is obvious. The trend to open corporate records to the public and to make more financial statements public has never retreated and always moves in the direction of greater openness. In 1900. the annual report for Proctor and Gamble in was published in one column of a Cincinnati newspaper. It is the commercial bias toward openness that helps commerce spread and thrive. as it still was in March of 2000.takes a few more steps toward openness every year. whether geographic or © Copyright 2004 Michael Phillips 41 . the annual report was 46 pages including 40 pages of financial data.
windsurfer technology spread over the planet. mountain bike inventions in San Rafael became a global phenomenon. The same copy. Openness is not the same as honesty. homebrew computer makers from Palo Alto. to become a global franchise. and once a success has occurred the knowledge of the success spreads and cannot be restrained or suppressed. adult comic book distributors and paralegal specialists. I watched dozens of businesses being created in the exuberant entrepreneurial world of 1970s San Francisco. homeschooling experts.and-spread pattern was true for New Age business training schools. then bought-out. The chocolate cookie makers in Sausalito became a national chain. acupuncture practitioners. Many became national and international business successes. In that era. The Body Shop on Union Street was copied. Commerce is a genie in a bottle that keeps getting out of each bottle and can never be put back in. Commerce inadvertently favors honesty because dishonesty cannot thrive in an open 42 .social. The words are not synonyms but they are very close. I watched the phenomenon of open business innovations go from small markets and single entrepreneurs to global commercial successes.
intellectual. Meritocracy rejects inherited aristocracies. physical conditions. Meritocracy Beats Everything Commerce is meritocratic. Meritocracy rejects prejudgments of people based on their birth status. based on output or sales. © Copyright 2004 Michael Phillips 43 . religion. heredity. Commerce is able to choose one over the other. In the commercial world. emotional or political skill of the producer is. nationality or any other identity tag. The openness comes first --. Meritocratic means accepting people for their empirical. meritocratic means that giving two people who appear to be able to do the same job or function (such as building a chair) a chance to show their skills. testable attributes. meritocracy will expose the commercially favored one.environment. ethnicity.the honesty is a by-product. Commerce almost defines meritocratic. It really doesn't matter what the physical.
he regularly helped out in the shop. Franco’s grandsons will take an active role in the coffee business which has grown a wholesale arm and an espresso-machine-repair arm. Office politics could become more difficult and more highly charged. When Franco’s son was young. the four or five regular employees are all hired from the church that Sergio and wife loyally support.It is easy to have warm feelings about a family business. I go to coffee every morning in a lovely espresso shop that was created and owned by Franco. a Sicilian immigrant. Sergio. The daughter would presumably be on track for the top job. and his wife took over the business. the son. 44 . and they bring their two young sons in to play with crayons and keep the parents company. Over time. I don’t think it would be a pleasant situation to be in. Now the couple works hard every day seven days a week. At my coffee shop. The same would be true of others in my department. When Franco died. Nepotism wouldn’t feel so warm and comforting if I were working for a four-hundredperson corporation and the daughter of the company owner was assigned to my department. either for my boss or me. Merit would be far less important to my boss than my friendship with the owner’s daughter.
or anyone whose physical appearance is the same as yours. however. The most conspicuous commercial © Copyright 2004 Michael Phillips 45 . to a loyal member of your clan. picture what happens in the commercial world to the goods or services of a seller who uses any of these nonmeritocratic. Lao. pro-family. On a small scale.We take the meritocracy of commerce for granted. clan or peers. Giving a job to a family member. The favoritism that may work locally is. a limitation on the scale of the business. Picture in your mind one of the many nonmeritocratic societies in our world. There are limited circumstances where a nonmeritocratic business will thrive. is nonmeritocratic. Arab. That rarely happens in the commercial meritocratic world. tong or tribe. Ibo. Now. They may generate some in-house business. particularly Arab societies. Most skilled people in the labor market don't choose to work for a business because it has family members working there unless they are members of the same family. The business only succeeds in the limited geography of the clan. pro-clan models. I have given some thought to the problems of third-world development. In the nonmeritocratic world. tongs and tribes may favor their own businesses. clans. you would fill a job based upon your own loyalty to your family.
he’ll most likely leave the family company. The Indian engineer has a better chance of thriving outside a Chinese family milieu. Insurance is usually the reason. 46 . If the Indian engineer gets a chance to go to work for an ethnically diverse meritocratic company. Nepotism only works on a small scale. Markets Versus Monopolies or NearMonopolies Commerce is disposed to favor markets over nonmarket environments. No clan and no network of relatives has sufficient talent to run a largescale business. Think about a talented Indian engineer working at a familyrun Chinese shipping company.problem third-world societies have is that they do well in day-to-day trade environments but do poorly wherever large-scale employment is required. if ever. such businesses either rely on meritocracy or they are surpassed by other commercial ventures in the larger world. Family and clan businesses also face the problem that meritocracy doesn't mix very well with nonmeritocratic values. Ultimately. The reason is simple. No family is large enough or has diverse enough talents to run a large-scale business.
has several advantages for the seller who starts with a limited number of clients. Both the craftsperson and the aircraft manufacturer would be better off with a broader market. simply for insurance reasons. and an aircraft manufacturer whose primary client is one military agency. Nevertheless. First. Of course. more market-driven companies regularly buy out military aircraft companies. the market will be a source of innovation that may be so rapid and dramatic that the narrow monopolistic supplier will become a high-cost outmoded business.Consider the examples of a craftsperson who has one loyal family member as the main client. the monopoly relationship can be so profitable that long-run survival is discounted. The loss of the one customer could mean the end of either business. The same is true of craftspeople whose clients see a new product which is © Copyright 2004 Michael Phillips 47 . That type of innovative market change happens regularly in the aircraft and crafts fields. the forces that will lead a business to prefer the market over a narrow range of customers will always play a significant role in the world of commerce. The specialized narrow market for military aircraft means that other. with multiple buyers and sellers. The market.
A typically corrupt situation would be if a small group of telecom buyers had the power to choose new telecom equipment from one of a few sellers. more loyal. Corruption can thrive only in secretive nonmarket environments. I don’t mean to suggest that corruption is entirely negative. The market preference of commerce inevitably ousts corruption. but it is really a byproduct of the commercial preference for open markets. This corrupt situation would evaporate as more buyers and more sellers entered the marketplace. family dynamics change (one sister marries a better. This anticorruption quality of commerce and markets could be identified as a separate social value of commerce. and the original family choice of craftsperson loses out. in the market and move away from the single supplier. Corruption refers to the 48 . corruption plays a smaller role. Likewise. As more goods and services move into a market. or more intimately connected craftsperson).nearly impossible for the craftsperson to duplicate. Secret bribes would be a likely element in the selection of the final seller. Therefore I haven’t treated anticorruption as a distinct commercial value.
Corruption is often the only mechanism that permits commerce to succeed.violation of a moral stricture. The corrupt practices of the waterfront businesses. acting in conjunction with the corrupt port landlord. The citizens got vital businesses to serve them. an area controlled by a corrupt landlord employed inside the Port Commission. In this case. bureaucratic and contrary to the interests of the users of the port. Businesses were quite willing to pay whatever bribes were needed to rent waterfront space. were ultimately good for the citizens of San Francisco. The Port Commission had rules and restrictions on property use that were arcane. and the city got revenue from space that would otherwise have been empty. Commerce is indifferent to the use of corruption. I have watched businesses that needed to work on the waterfront. In San Francisco. corruption and bribery were effective ways to circumvent the poor governance of the Port Commission. irresponsible. Corruption and bribery are tools that commerce will use whenever and wherever it is effective. Monopoly Position in the Market © Copyright 2004 Michael Phillips 49 .
The fact that government can create and protect monopolies and that government monopolies can be bought by businesses is not a reflection of the corruption of commerce. Commerce. Commerce will always find a willing buyer for a government that wants to sell a monopoly opportunity. Technology and Commerce Have Strong Affinities 50 . will always seek a monopoly seller opportunity.Much has been written about monopolies in the economic literature. It is the government that is corrupt. Commerce is indifferent to the corrupt nature of the transaction. being indifferent to morality. Commerce would appear to have an affinity for monopoly sales opportunities. working against the common good. including an indifference to the common good. Economists have pointed out that monopoly sellers are usually generated by government decree or government regulation or where there is a land monopoly for geographic reasons. A piece of dry land near the confluence of two great rivers is an example. Economists have shown what common sense teaches. that a monopoly seller extracts excessive revenue from buyers.
This affinity was evident not only in the last few hundred years of our blooming industrial society. is the outcome of many miniscule independent processes. Technology ground glass lenses and put them in telescopes to deal with the © Copyright 2004 Michael Phillips 51 . but not a bias toward technology.Commerce has an affinity for technology. But the incorporation of technology into commerce. the marriage of technology to commerce. The affinity comes from the fact that both commerce an technology are empirical worlds. the cotton gin and the railroad. both learn about the world empirically. which is inseparable from the expansion of technology. Commerce evolved clocks to help merchants deal with each other efficiently. There is an affinity for technology. I suggest that the important interaction of commerce and technology occurs at the level of these processes. but is also evident today when we look at details of the interaction between commerce and technology. or more accurately. Both are morally indifferent approaches to the world. Technology and commerce have some parallels. Most of us have been taught to see the industrial revolution as a by-product of the steam engine.
As a consequence of lacking much real knowledge about the world. Refutable means that a particular technology or form of commerce works inconsistently and can be replaced with one that works more consistently. each of those earlier bridges was based on a technology that 52 . as time moves on. experiment with. Quartz watches also suited the marketing practices of the Swiss watchmaking industry better than escapement watches or the alternative digital watches. presumably because it represents a more accurate interaction with the world.4 Technology.awesome sky that appeared to rotate around the earth. We use quartz watches now because they are more reliable and accurate than the escapement watches they replaced. is incremental in the sense that a contemporary bridge is a product of the many centuries of technology. When predecessor bridges were blown over or swept away by rivers or tides. The replacement works better. we humans continually test. guess about and use approximations to try to understand our world. We go about our lives in the world of commerce and technology by learning which of the views we hold that are refutable and which are usable.
Commerce will favor the training course/consulting mechanism over the blood-test technology. but the blood test has a lower success rate. Let us assume that there exists a technology in the form of a blood test that performs a similar function in predicting diabetes.was refuted by the physical world. the potential for improving the blood test will drive technologists to do so and © Copyright 2004 Michael Phillips 53 . A medical doctor finds that by asking a series of questions about eating habits and family history she can predict an incipient case of diabetes in a patient. A current bridge is an incremental product of what was learned from the earlier bridges. given that patients will pay for this improved diagnostic technique. Commerce will favor a business mechanism that will help the doctor to train other doctors in the same methodology of diagnosis. Our doctor may establish a training course or a consulting firm to commercialize her diabetes prediction methodology. Commerce has no protechnological bias in this case. Let me offer an example of commerce interacting with technology. However. This example shows how the two work together on a specific detailed level.
consistent and reliable in a variety of circumstances. The accuracy of intercontinental ballistic missiles reached the point where they were landing accurately within tens of meters over tens of thousands of kilometers. but this level of technical accuracy was never used in commercial aircraft because commercial aircraft guidance systems only needed gyroscopes that would get the plane to within a half dozen kilometers of a destination airport. Technology and commerce work together. no matter how beautiful or powerful it is. The training/consulting business may lose out in the long run because a lab technician will be able to do the test accurately without the need for a higher-paid doctor. commerce has an affinity for technology but not a bias toward it. The technology of a blood test has a greater commercial potential because it may be far more replicable. But 54 .commerce may eventually bring the improved blood test to market. Many examples exist where technology has run rapidly ahead of commerce and been ignored by it. The technological advances in gyroscopic accuracy were irrelevant to commercial airlines. In this example. Technology is not worshipped by commerce.
000 to 1. There are roughly 4. but the bigger the corporation the more likely it is to operate with distributed decision making. This ratio of small corporations to large business has been stable for many decades at 10. a hundred million to a few thousand. In the success of both giant corporations and franchise/chain outlets we seem to see the power of centralized decision making. This bias is not so obvious when we see that giant corporations thrive and franchise/chain outlets proliferate.000 employees. Big corporations and chains clearly grow because of economies of scale. There are only a small number of large corporations in the world.commerce has a propensity to consider any technology seriously. suggests the © Copyright 2004 Michael Phillips 55 . Distributed. This small-to-large business ratio. Decentralized Decision Making Commerce appears to have a bias in favor of distributed and decentralized decision making rather than centralized decision making.000 businesses on the planet with more than 20. out of more than 100 million businesses.
metaphor of many blades of grass to a few tall pine trees. I take the small-to-large ratio to mean that local decision making is significantly more efficient than centralized decision making. Both McDonald’s and Starbucks succeed. and management quickly sells out to a larger company. The rest of the business is successfully operating with decentralized decision making. finance. as do other similar chain businesses. customers want 56 . many of the four thousand large corporations are temporary anomalies of equity markets. We all think of McDonald’s and Starbucks as large centralized systems that thrive. because they cater to the highly mobile populations of the world. accounting and training. On a regular basis. Customers want a consistent experience wherever they go in the world. The franchise/chain phenomenon has the same strange quality as the large corporation. My guess is that this is happening to 10 percent of all large corporations at any one time. Moreover. What happens is that a large business starts to fail. That creates a few larger corporations. That is why there are so many more small businesses. What we have in the large scale in fact are economies of scale in managerial talent for marketing. the newly absorbing larger corporation fails and splits up into modest-sized segments a few years later.
bakeries. California and Seattle. hair salons. Washington. I have worked as a consultant with many small businesses that have confronted expanding franchises and chains in their local markets.their food and drink to have the same taste and safety qualities. Their adaptation is more impressive than their standardization. The visible outcome of the struggle between centralization and distributed decisions reflects the value of distributed decision making more than it reflects the value of centralization. © Copyright 2004 Michael Phillips 57 . This desire for consistency in an unstable world makes the replication of commercial experiences of McDonald's and Starbucks appealing. I’ve worked with bookstores. bagel shops and other retailers faced with nearby expanding chains. In both the McDonald’s and Starbucks cases. Distributed decision making struggles with centralized economies of scale within these large corporations. Both corporations adapt their practices to local markets in overseas locations. restaurants. coffee shops. The Tokyo outlets of McDonald’s and Starbucks are a far cry from the same name versions in San Bernardino. the corporations have distributed their hiring decisions to local stores and leave many marketing decision to regional managers.
not moral. we can see the positive role of decentralized decision making and when we look at industry we can see the same effect.The solution for locals wanting to retain customers and stay in business against a chain is always the same: The local business must be more responsive to local customers. Summary Morally indifferent commerce has a few positive social values built into it: diversity. These are the positive values that are celebrated in this book. Local businesses have many advantages over centralized-chain decision makers. access to information and excellent recourse and (2) accommodating local product/service tastes and responding to local social traditions (such as participating in neighborhood events and Rotary Clubs). These social values are functional. technological affinity and a distributed-decision bias. courtesy.5 58 . This means (1) offering the same level of service that the chain offers. such as cleanliness. openness. market preference. When we look at specific industries. That is the reality of distributed decision making in commerce.
© Copyright 2004 Michael Phillips 59 .
When I found the unpaid commercial loan that my grandfather had left with the Bank of California, more than half a century earlier, I felt the need to inform management. I was a vice president of the bank that my grandfather had skipped out on. Did I have an unwritten moral obligation to the bank? The executive committee of the bank heard my story and told me to forget about.
Living in a commercial world promotes a commercial mind in each of us. Among the many attributes of the commercial mind that we need to be aware of are the monetizing of nearly everything; the unlimited potential for greed; cynicism; blasé attitudes; the rise of irony in our perception; the adoption of a managerial perspective; the elevation of “'whim” and self-absorption to major life values and the emergence of global commercial behaviors.
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With our commercial mind we also expect to live in a world of surprise and wonder. I was talking to a friend over the phone, a real estate broker, who was standing on the upper steps on a lovely hillside overlooking San Francisco Bay. I was about to fly a singleengine plane over San Francisco from an airport twenty miles south. I asked Annie, the realtor, over the phone, “How do things look?” I was expecting a description of the cloud coverage over the Bay. Annie replied that she was "distressed." She said: “I’m seeing so many magnificent large houses in a neighborhood where so few people are dying.” In my mind, I wondered what people dying had to do with clouds over the Bay. Annie explained herself. What she meant was that, for her real estate business, too few of the houses she was looking at would come on the market. If more came on the market there would be more houses for her to sell. Thank you, Annie; you just made two of the points I want to make in this chapter: First, commerce has shaped our minds and our modern worldviews. Annie sees houses as
We can also be fairly accurate about details such as how much a new roof or a new exterior paint job would cost and the income necessary to live in the house. irony is a characteristic of the commercial mind and a subject of this chapter. Annie was using irony in her comment. would not know most of the prices the reader knows. Most of us have a monetary perspective as well. the cost to buy a lot and build a similar house. Monetizing Nearly Everything It is hard for us to realize just how commercialized our minds have become. This monetizing perspective is infrequently found in rural areas and even more rarely in third-world nations.objects of income for her. we can see beautiful homes in a variety of perspectives. even after living decades in the United States. Second. the cost of keeping the house heated and the rental rate for the house. Having the ability to approximate all of these market prices is a core part of our commercial mind. Of course. A Central American farm worker. We can guess the price of a house. from color to architecture to imagined comfort. Not all people have this ability to bring to mind many commercial prices. even if he was currently working in the © Copyright 2004 Michael Phillips 63 . the amount of property the taxes.
The other business is eBay. A large number of people do arbitrage on eBay. They find an object that is underpriced in their local market or on eBay itself and resell it. The show is a weekly TV program that sets up travels to major cities and invites citizens to bring their antiques to the show for evaluation by experts. Two businesses in modern America reflect the monetization of our world. academic and so forth). One is the Antique Road Show. military.construction industry. 64 . and the commercial perspective exists specifically because we are living in a commercial world. wiping off the patina ruined it?”). There are many perspectives on the world around us (religious. The commercial mind was not part of his worldview in rural Central America. Tens of thousands of people in the United States make a living buying and selling on eBay.000?”) and others being overvalued (“So. This Internet company allows people to buy and sell nearly anything over the Internet. The show is premised on the notion that a knowledge of antiques results in some household artifacts being undervalued (“Oh my goodness. its really worth $5. We have become part of the commercial mind: We are ourselves commercial entities. Such a show only makes sense where people are pricing everything in their lives.
for $25. our realtor. My list is far from exhaustive. defeat. There are three ways to put a price on the tree outside my back window. Everything can be compared to everything else through the medium price. wonder -. we can see nearly all the physical world in commensurate terms. Using Price to Make Everything Fit One Scale of Measurement Just as Annie. It could be sold and relocated. The commonality of price puts everything on the same scale of measurement. We can price nearly everything. Most of the physical world can be put on a single continuous scale by using price. we will look at a number of interactions that individuals in a commercial society encounter daily.000.In the next few pages. © Copyright 2004 Michael Phillips 65 . Fifteen thousand dollars buys a good secondhand car. sees houses as potential sources of income.000. If properly done. My list is intended to convey some idea of the commercial mind we all share. it could be sold for raw timber for $2. These include humor. just as William Randolph Hearst planted fully-grown trees at San Simeon.and many more. That eighty-footfoot tall Norfolk Island pine would cost $400 to have removed.
However. price. and they do it based on earnings potential. There are professional assessors who can price mountains. Most of us know the prices of tens of thousands of goods and services and can make a good guess about tens of thousands more.a year's rent in a modest one-room beach house in San Diego or a new kitchen in a modest home. Since mountains rarely get bought and sold. is very different from an artistic perspective of the world or many other traditional perspectives of the world. or it has been considered morally objectionable to put a price on a human life. it is hard to price a mountain. often to the government. Her surviving family asks the court for a settlement from the insurance company based on the amount of money the two adults would have earned over the span of their working 66 . This scale of measurement. That puts nearly everything on the planet on the same scale. Human life has long been considered priceless. An object or behavior in the world doesn't enter the price measurement scale until it enters the market. But mountains are now bought and sold. courts are regularly called on to price humans. It has taken centuries for a world of mental price tags to develop. An example would be a school principal killed in an auto accident with her husband and one child aged less than six years old.
Courts are asked to price the value of parenting and companionship as well. We humans sell our work in the market. therefore we have a price. Simmel on the Commercial World Georg Simmel. We can price a wide range of nonphysical entities. Avarice Avarice. He could still remember a precommercial era. We price college education. a Central European sociologist at the beginning of the twentieth century. For us. Simmel can be like a visitor from another time. a guide on the John Muir trail in the Sierra Mountains and a ride into orbit in a space ship. He also commented on greed. Earning potential is a market measure. may well be distributed widely at birth in a society. He actually lived in a period well before modernity had developed. He was the first to examine the subject of the moral indifference of commerce. cynicism and blasé attitudes. we price an orchestral performance with different prices for different seats. Simmel pointed out. like the © Copyright 2004 Michael Phillips 67 . We price a vacation in Kauai. made many astute observations about commerce.years.
almost anyone can experience avarice in its multivariate forms simply because it is therefore easy to be in the middle class and middle-class status allows us to acquire abundant possessions easily. Homeless people can be avaricious too. and there is no limit to how much they can accumulate. Middle-class people fill up houses and 68 . If jobs are abundant. but when commerce comes along to create a middle class.cards in a well-shuffled deck. Many people have fifteen-thousand-square foot houses with four-car garages. and many people have a net worth of more than a billion dollars. This is not to ignore the observation that there are homeless people on the street pushing several shopping carts loaded to capacity with their possessions. Simmel’s first observation about avarice is obvious: If more people have jobs. there is no limit to how many people can be avaricious. Avarice in an abundant society does not require a middleclass job. providing jobs and money for a large part of the population. commerce allows many more people to experience avarice. avarice can have a modest effect. In a farm village. maybe someone hoards potatoes or buys more and more neighboring land. more people are able to be avaricious. In the modern world. Commerce makes avarice far more accessible.
When enough money is available. Simmel's second observation is interesting: The main contribution that commerce makes to the experience of avarice is that it supports the convenient accumulation of money. When wealth could be measured only in gold. any physical barrier to satisfying avarice is eliminated. it can be easily and safely stored in infinitely large quantities. and © Copyright 2004 Michael Phillips 69 . Money is the potential to buy. Homeless people fill up shopping carts. Avarice no longer has any bounds. Even today.garages. Avarice is so acceptable and pervasive that an avaricious modern person can readily find a comfortable community to live in. it was much harder to accumulate large amounts because safety and bank capacity were limited. The development of government bonds in the late 1700s helped to reduce the storage and risk problem of large amounts of money. There are many communities where avarice or an unlimited desire for possessions is a normal value. avaricious dictators have to store their money outside of their own country because they can't rely on the confidentiality of their bankers and they have to worry about losing their wealth if they are overthrown.
Modern forms of money safety make wealth and greed truly boundless.” We have almost forgotten the meaning of words like honors and virtue. and so the more a mocking and frivolous attitude will develop in relation to these higher values that are for sale for the same kind of value as groceries. beauty and salvation of the soul are exchanged against money. the more one discovers that honors and conviction. was an improvement. we can see that we have been increasingly absorbed into the commercial mind.the later development of registered bonds. Today. talent and virtue. According to Simmel: “The more money becomes the sole center of interest. His observations are particularly valuable. which allow the owners to own bonds without having the physical bonds on hand. and many of us are comfortable with that. there are safe ways to own and store billions of dollars for one individual. One hundred years after Simmel wrote. They were still central forces in everyday life in Europe a century ago. Most 70 . We have become cynical. Cynicism Simmel also made observations about cynicism and blasé attitudes.
but the traditional concepts of honor and virtue are seldom praised in our commercial world Blasé Attitudes Simmel says the commercial mind is blasé. “I'm going to become a Marine officer for the honors it will bring to my family. today. He considers a blasé attitude different from a cynical attitude: “The blasé person has completely lost the feeling for value differences. A modern parent might have a number of reasons why dropping a beer bottle out a moving car is bad but the allusion to "our kind of people" is based on an earlier concept of virtue that is passé. What notions of honor that still exist in our commercial society are greatly diminished. those aren't our kind of people” in reference to seeing a man drop a beer bottle out of a moving car. particularly where the © Copyright 2004 Michael Phillips 71 . as not worth getting excited about. It would be a surprise to hear a parent say to a child “We don't do that.modern cynicism comes from the forces that Simmel described. He experiences all things as being of an equally dull and grey hue. We are not entirely a cynical people. It would be a surprise.” Such a statement would not have been surprising a hundred years ago. to hear a seventeen-year-old say.
The extra time forces us to examine the meaning of our unstructured lives. A jaded and apathetic life drives people to have sexual affairs with their neighbors. Blasé is not the devaluation of things as such but indifference to their specific qualities from which the whole liveliness of feeling and volition originates. Not only has commerce given us extra time in our lives to become blasé. on TV and in the movies. While the rich and glamorous jet setters are notorious for their blasé attitudes. Irony 72 . I look at the large number of soap operas and the endless parade of melodramas in the theater.will is concerned. the extra time has contributed to a loss of the clear sense that we have to work to survive. insult family members at family gatherings and file meritless lawsuits in hope of bringing melodrama into their “dull and grey” lives.”1 Most readers can recognize the pervasive blasé attitudes around us. Apathy is an emotional luxury that results form commercial success. otherwise we don’t know what we can do in our free time that is worthwhile. these are a testament to blasé lives. the same viewpoint permeates much of the lives of ordinary people.
irony today is a common worldview. A situation is recognized as ironic when the actual outcome and the expected outcome are different. just in our lifetime. We find irony nearly everywhere. TV is full of irony that seems popular with a broad swath of young people. The lottery is very popular. full blown.” That kind of statement is usually ironic. It has arrived.Irony is a powerful and distinct contribution of the modern world. Irony works well with incongruous situations and with paradoxes. Examples of three common forms of irony are: 1. A program called Who Wants of Marry a Millionaire? involved a cluster of women trying to catch a handsome young man they were told © Copyright 2004 Michael Phillips 73 . People around us use irony in discussion: saying one thing but meaning the opposite. Saying one thing that has a literal meaning but intending to convey the opposite: “I play the lottery because the overhead in the lottery goes to support education. Often a situation is recognized as ironic because the actual outcome and the expected outcome are different. but the reason why is that people hope to win a great deal of money for themselves. 2.
Irony is the way that an individual can comfortably hold 74 . Cynicism and a blasé attitude are negative responses to a morally indifferent commercial world.” Everyone. irony is an integral part of modernity. One of our great contemporary philosophers. 3. where the more intense commercial clans live. celebrates irony in modern life because he sees it as a healthy response to the absence of a “certified world. is a positive response. Richard Rorty. Sally came to a winter party in white summer clothes after her part of the country had suffered three weeks of continuous rain. and it was brought to us by the commercial world. this will certainly change the weather. “I'm dressed for spring. Nevertheless. Irony is particularly strong on America’s coasts. as far as we know. Irony.”2 The book is Contingency.was a millionaire. The viewers of the program knew from the beginning of the show that the man was not a millionaire. recognized the irony of an individual suggesting the clothes she wore could change the weather. and Solidarity. Rorty says. and weaker in the midlands where older traditions still survive. The show wallowed in the irony of the viewers knowing what the participants did not. Irony. Irony works well in incongruous situations and with paradoxes.
you didn’t look first left and then right. In traditional families. you weren’t paying attention to traffic. Rorty believes that irony contributes to debate and complex thought and ultimately contributes to democracy. “Johnny.” By contrast in a family where one or more parent is a manager in a work environment. that parent will often bring managerial practices home. they © Copyright 2004 Michael Phillips 75 . In the case of Johnny.multiple perspectives at the same time. you ran across the street when you should have stopped and walked carefully and you don’t seem to remember that cars can’t see as well when there is rain on their windshields and the sunlight is behind you. Managerial Values at Home Much of what people learn in their work environment is carried home into child-rearing practices. This is becoming increasingly true as more people become supervisors and managers. I've observed that a child will do several things wrong and the parent will correct all of them at once.
They will also reinforce good behavior. reliability and working steadily for long hours have become ingrained in the modern commercial person’s life. Credit Worthiness I did business consulting for Visa in Japan and was surprised to find that one reason few Japanese use credit cards is because Japanese young people have never been trained in the practice of credit. Promptness.would borrow from their behavior with an employee at work. “Johnny. it is very important to be extra cautious crossing a street on days when it is raining and drivers can’t see pedestrians as well.” There are other ways that employment experiences shape our home lives. They would pick only one mistake and emphasize that particular mistake so that one solid lesson can be learned. Most spend the next decade of their life learning from experience how to use 76 . unsupervised. Americans very commonly get credit cards at college age. I’m proud when you pay close attention to safety matters. Japanese are raised to save their money before buying anything. These work practices are so deeply ingrained that salaried workers are commonly offered the option of working at home. I’m glad you look sheepish about your behavior.
they focus on a strategy for daily © Copyright 2004 Michael Phillips 77 . We can buy nearly anything.credit. but commerce in America is leading the world in this element of the commercial mind. Some rapidly use up all their credit and make minimum payments for years. This difference arises largely out of the consumer is king nature of the marketplace. and a seller will nearly always accommodate our wishes. A few never learn to keep their expenditures under control and lose access to credit. The World of Whims and “Personal Authenticity” A commercial society such as ours creates a core worldview that seems to me to be very different from traditional core worldviews. Most Americans learn how to use credit from experience. Other societies may follow suit. Creating a mind set that allows individuals to connect their desires to their income while using credit is a significant accomplishment of the second half of the twentieth century in America. When people are close to the edge of survival needs. One of the consequences of the consumer is king is that we become people who live our lives focused on whims.
In his book The Ethics of Authenticity.survival. In a commercial world where nearly everyone has large amounts of time and economic resources. Need constitutes only a small part of our automobile. “What shall I wear today? Should I travel or take a class in fabric design? Should I visit Don or make a fancy dinner -.or go shopping? What do I feel like doing?” We are living in a world of whims. The commercial world creates an opportunity to live a life devoted entirely to frivolity and the pursuit of fleeting desires. It would be hard to argue that the commercial world we middle class people live in is. home. Canadian philosopher Charles Taylor believes that focusing on whim is related pursuing a positive ideal. Taylor argues that a focus on whim is a degraded version of the individual’s search for authenticity. this time and wealth can be used to seek personal authenticity. Taylor argues 78 . Whim constitutes the greater part of these choices. take the bus and save money. clothing and food decisions. and make my own lunch instead of eating out?” Many of the rest of us spend a great deal of time exploring and catering to our whims. “Do I have the energy to work overtime. anything other than a creation of whims.
The Changing Definition of Beauty © Copyright 2004 Michael Phillips 79 . Society has no need to know how many freckles any particular person has on his or her left leg. Doing volunteer work in a clinic is also something that wise peers and mentors might recommend. Commerce and the commercial mind can make a valuable contribution to society when individuals use the freedom commerce generates to seek personal authenticity and make the society richer in vitality. imagination and compassion. Doing volunteer work in a clinic is socially meaningful and can be a step in the search for personal authenticity.that the difference between pursuing our whims and seeking our own authenticity is the difference between conducting our search without reference to the positive values of our society and conducting our searches in dialogue with wise peers. mentors and people we respect. whim versus authenticity is the difference between spending a year counting the number of freckles on one’s left leg and working as a volunteer in a prosthesis clinic. For Taylor. Personal authenticity can provide a social gain derived from the abundance created by commerce. The freckle-counting exercise is done without reference to the values of society.
We can find beauty in an Aubusson carpet. a vase. early Harley Davidson motorcycles. earlier massproduced objects were invariably considered déclassé and only one-of-a-kind objects or onetime performances were thought to be objects of beauty. for that matter. The commercial mind accepts beauty in the object it beholds without requiring that the object one of a kind.Contemporary consumers have. All of these can be beautiful to a modern person with a commercial mind. 80 . Only a few centuries. Leica cameras and countless pieces of art and artifacts that were manufactured on an industrial scale. Charles and Ray Eames furniture. almost without notice. a camera. We commercial humans have decided that beauty can be found in mass-produced artifacts. regardless of the number of copies manufactured. A Movado watch can be a thing of beauty even when produced by the millions. a skirt – anything. We know that expensive Persian rugs each have a flaw in them to convey the one-of-a-kind hand-made nature. Our museums are stuffed with Movado watches. decided that mass-produced objects can be beautiful. The same can be true of a movie that will be seen by millions and a recording of a performance. This is a big change. the same can be true of a car.
Nature and natural objects are traditional sources of wonder: butterflies. but we often end up taking them for granted. new food products. Commerce brings us wonders of extraordinary quality. In a traditional society. a new TV program. We want new stores. Commerce is heavily built on surprise. mountains and spring flowers. earthquakes and volcanoes. shoes and autos.Surprise One of the delights in living in our modern commercial world is the element of surprise. lightening. new buildings. twenty and a hundred times our © Copyright 2004 Michael Phillips 81 . But surprises like disease and death are not the kind that we commercials moderns anticipate and expect. We love it. animals. nature brings the unexpected in the form of weather. we value the surprise of newness: a new movie. Instead. new houses and new sculptures in our world. clouds. the latest styles of clothes. Commerce has brought us urban downtowns with dozens and even hundreds of enormous buildings ten. Wonder Wonder has always been a part of life.
As a consequence. sometimes we forget how wonderful they are. We have bridges and airplanes that weigh ten. they were technological wonders. While tall buildings. They were built and operated because they were technological wonders.own height. But because technology and commerce are so pervasive in our lives. Bridges allow us to span rivers and bays and airplane allow us to fly like birds. twenty and hundreds of times our own weight. I accepted a view of culture that is close to the strict Whorf-Sapir3 model that 82 . Global Commercial Behaviors I have spent much time living in other cultures. The wonders of technology are usually available to us because they are also wonders of commerce. I think I’ve succeeded in living an ordinary life among non-Americans. bridges and airplanes are technological achievements. there would only be a few of them if it were just a matter of technological accomplishment. Commerce brings technology into everyday life and creates hundreds and thousands of replications. Think of the supersonic commercial airliners that are now nearly gone. Commerce didn’t need them – that is why commercial supersonic jetliners are nearly gone.
to drive cars and use electricity and sophisticated tools and appliances. like technology and science can bring of effective intercultural interaction to a genuinely productive level. I was convinced that they were hard to recognize. My personal experience led me to believe that cultures are deeply different from one another. Electrical and © Copyright 2004 Michael Phillips 83 . My experience over the past few years and my thinking about the issues covered in this book have led me to a different conclusion. That was the cross-cultural perspective I had a few years ago after living and traveling for decades outside the United States. We can learn a language and communicate with other people. Once I started paying attention to cultural differences. Urban people around the world have developed many common experiences based on common technology. I now believe that commerce.each language and culture incorporates its own distinct worldview. Technology has taught a wide range of people. and we can effectively understand and work with people of different cultures. across cultures. hard to accept and the significance of their differences was generally unappreciated.
is very similar in cities the world over.the way we spend our time each day -. The same is true of science and mathematics.mechanical engineers find cross-cultural work fairly easy. we use accounting. including the Internet and television. credit and a wide range of media. That creates a pervasive and extensive common culture on top of the traditional language-based cultures that separate us. banking. usually commuting to a similar industrial office setting. which allow a wide range of scientists and mathematicians to communicate comfortably across traditional cultural and language boundaries. important common ground between urban people the world over. working roughly forty hours a week. using an education that prepared us for the work and employing a plethora of tools and documents that are common to a global trade system. Because of commerce. 84 . go to work. that have common commercial functions. Commerce is the most surprising and. Individually. in my opinion. We get up in the morning to a clock. the minutiae of our daily living patterns -.
Business values have entered our home lives. including managerial techniques for child rearing. it provides a shared and powerful common © Copyright 2004 Michael Phillips 85 . The commercial world feeds our daily desire for of surprise and inures us to wonder. has created a common cultural base: a set of common behaviors that allows the daily lives of several billion people to interact. We have allowed avarice free rein at a level and extent never before imagined. As commerce spreads between cultures. some find it a positive value. We can price nearly everything and we do. scheduling our lives and controlling personal credit in a businesslike way. Many people in our society take irony for granted. Cynicism and blasé attitudes run rampant in our society.Commerce. more than anything else. Our perspective on daily life differs significantly from that of precommercial societies.4 We have entered a world where whims are a common motivation and beauty can be found in many common forms. Summary Commerce has changed the way members of commercial societies view the world.
86 .experience among diverse peoples of the world.
© Copyright 2004 Michael Phillips 87 .
had a successful practice in Berlin from 1906 until 1917. The whole family. Grandpa was able to rebuild a thriving practice. Commerce and Government The vigor of commerce. Today. 88 . including my father. were not able to stay in Berlin after the United States entered the war against Germany. who was born in Berlin.Chapter 4 My grandfather. the dentist. in any country. Commerce needs a government that is neither too weak to protect private contracts. depends on the government. such a loan would have been repaid with Federal disaster relief funds. when he was forced to leave Germany and return to San Francisco to start his dental practice all over for the third time. The 1906 loan that my grandfather got from the Bank of California was apparently forgotten or forgiven because his business was one of many destroyed by the 1906 earthquake.
” Unfortunately. We need to learn what works best to keep commerce vigorous. The government we have in the United States does well with commerce. © Copyright 2004 Michael Phillips 89 . taxes and government agencies to create exactly the right mix of “not too weak and not too strong. we don’t know the answer. Mancur Olson taught economics at the University of Maryland. Olson’s framework was the start of my thinking on the subject of commerce and the state. nor so strong that it squashes those contracts whenever it wants to. Wisdom suggests that we keep an open mind on the best ways for government to help. and the government of Cuba does poorly. right now. at the beginning of the twenty-first century.including citizens’ property rights. It would be good to know how a government can promote commerce by fine-tuning laws. new tax ideas. new administrative policies and new judicial approaches. not hinder commerce. He was the first person whose fertile mind gave us a clear idea of the real relationship of government to commerce. We aren’t close to knowing the right mix of government policy that will promote commerce. We should encourage governments to experiment with new laws.
Industrial commerce needs long-term planning.Olson observed that the ideal government for commerce is somewhere between too weak and too strong. You would also have to pay protection money to the local police. 90 . think about running a stovemanufacturing business in Lebanon. and you would have to hire full-time guards to protect your facilities. Too weak a government and property laws are not enforced. The too-strong government operates by fiat. Weak government is bad for industrial commerce. To appreciate the value of long term planning. Afghanistan or any other country where the central government exerts little or no control over the country. Somalia. and vital parts imported from outside the country would rarely make it to your factory. Your stove company would have to be located in the capital city to protect the facilities and the inventory. the government often dictates prices and ownership conditions. The opposite is also true. With little or no government. the government gets. your production would limp along at a very low level with very high costs. What the government wants. When you have too strong a government. Trucks bringing your supplies would be regularly hijacked. Nigeria. contracts are unreliable and long-term planning doesn’t exist.
A government that is too strong to be good for commerce would be a traditional Latin American country in 1900. Government has different ways of affecting the flower shop. But commerce is not one way of doing business. Iraq under Saddam Hussein or Cuba under Castro. Before we can talk intelligently about commerce and government. Think of Russia under the Bolsheviks. Three Different Types of Commerce It would be nice if commerce had a simple definition and meant the same thing whether we were talking about the flower shop on the corner. the dentist upstairs or the chain bakery next door. China under Mao. A government that is too strong is a threat to commerce. • One form of commerce isn’t hurt by the absence of government • One form benefits from government © Copyright 2004 Michael Phillips 91 . where the dictator lets his brother seize control of any business that seems to be thriving. the dentist and the chain bakery. we need to consider the three different forms of commerce.
clientry and industry. A trader is a person who carries a bag of yarn from town to town. And a trader can be selling at a flower stand in a large outdoor market. Trade Trade is a form of commerce that is five thousand years old. My discovery of these varying forms of commerce came from twenty years of working with thousands of business clients. Commerce includes all three ways of doing business. one bouquet. selling skeins one or two at a time. The recognition of three types of commerce first appears in my book Gods of Commerce. We all take trade for granted. “I’ve got to make this one sale right now. The three categories are: trade.” Each sale requires a sale price that is high enough to keep the seller in business.” “One pot of flowers. The distinguishing mark of trade is the determination to sell one product (or service) at a time. A trader can also run a flower shop on the corner that buys flowers from local growers and sells them at retail. Nearly all the businesses I worked with fell into one of three distinct categories.• The third form of commerce can exist only with the right kind of government. The 92 .
Trade is present regardless of the conditions of government. These are traders who stay in business by selling one product or service at a time. It occurs in prison. in war zones. flea markets and local grocers. Some traders may haggle.” but that is usually not true. The trader may make it appear that haggling is lowering the price and may tell stories about the price being “below cost. Prisoners can always buy cigarettes.distinguishing trait of trade is one sale at a time. at the South Pole. It existed in the heart of Moscow under Stalin. as they traditionally have for thousands of years. © Copyright 2004 Michael Phillips 93 . Trade occurs everywhere and anywhere. we think of coffee shops. The customers of a trader tend to be responsive to price and will change suppliers when another trader offers a lower price. the price he/she offers may be higher or lower than that of other traders. The next time the trader comes along. When we think about trade on our current urban streets. flower shops. The customer usually seeks the lowest price. Each sale must be priced high enough to keep the trader in business. These sellers price their products high enough to stay in business.
Successful traders usually have to have something in their hands or wagons to sell (the exception being services. In the days before industrial commerce and large stable governments. Mitsubishi Trading Company. includes all the details: name of seller. price. Billion-dollar trading companies still make one sale at a time. is still a trading company. like those of storytellers and masseuses). These objects of trade need to be created and stored somewhere. you would see a large ledger with a separate line for each completed transaction.There are also giant trading companies that sell millions of board feet of lumber from a lumber producer in one country to the overseas processors in another. volume and a description of any credit involved. If you could look at their books. Cities usually had some form of secure storage for goods and a few financial organizations (banks to hold gold and insurance companies to protect merchandise against loss). in a trading company’s ledger book. selling over $100 billion a year. Cities were usually safe because local rulers hired military protection and in many cases built protective walls. The one accounting line. Safe cities 94 . cities were the safe places where trade goods were assembled and produced. buyer.
Trade goes on in war zones.have always existed. Early locations were Baghdad. Clientric commerce is very different from the trade form of commerce. Alexandria. later. The trade form of commerce does not require a state or a government. The goal of the pricing is to make sure that business relations continue over a long period. Amsterdam and Milan. more often. and traders will centralize their business in cities that offer safety. production and shipping. Carthage. even if an individual city didn’t survive in one place for long. A trader finishes one sale and is immediately looking for the next. Tyre. In clientric commerce. Trade benefits from stable markets. on the streets under communist tyranny and in prison. Venice and. Clientry Clientry is a new word. Traders were always able to find a location for assembly. Trade does not need states or government. Constantinople. the price of the transaction is set at a point that satisfies both the seller and the buyer. The goal of clientric commerce is to provide a product or. a service to a customer many times over a lifetime. Clientry is the form of commerce that is based on lifetime relationships. © Copyright 2004 Michael Phillips 95 .
trust and competence are what matter. The size of a business doesn’t determine whether it’s a trade or clientric form of business. graphic designers. Clientric business people stake a great deal of their business on their integrity. Clientric businesspeople include doctors. lawyers. People want a dentist who is competent and personable. Price is a subsidiary concern. A trader wants you to believe that you are getting the lowest price and the “best deal.” Not so the clientric businessperson. healers. since they plan to service the same customer many times over a long period. service is most important. since many of them can move on to the next town.Traders aren’t necessarily honest. Clientric businesses don’t operate the same way that traders do. far more than the price alone. Few people choose a dentist because he or she is the cheapest dentist available. The clientric businessperson wants the customers to feel they are getting the best service. An aircraft repair and maintenance business is 96 . tutors and gardeners. Large corporations can be clientric. The long term relationship. The same is true for all other forms of clientric commerce.
Clientric commerce has existed for as long as trade. Clientry does not require a state or government. Industrial commerce only exists because of government. A dentist in a war zone or on a cruise ship is not likely to see the same patient again. Stability is not necessary. but it is important. We tend to think of industrial commerce developing in parallel with technological innovation. healers and advisors of every sort. 1 Industry Industrial commerce. But in a stable location the dentist can develop a loyal. The same focus on longterm relationships applies to a good hospital and a good life insurance company. but clientric business benefits significantly from social stability. absolutely requires government.clientric. long-term clientele. Government was the system that made industrial commerce possible. think of ancient temple prostitutes. the third form. and we ignore the coronary artery © Copyright 2004 Michael Phillips 97 . An aircraft repair business will have the goal of a long-term relationship with their corporate airline customers and they have to plan for a long-term relationship since our safety depends on it. however provided.
then each plate costs less to produce. Nigeria or Libya today. When most people think about industry. they think about the application of power or technology to the production line but that is only a small part of industry. Industry is any business where increasing production decreases cost. A Josiah Wedgwood could never create a great industrial company in Cuba. Industry needs a stable. glazing and firing. There are several other ways that increasing production 98 . Josiah Wedgwood was one of the first practitioners of industrial commerce.of industrial commerce: government. water power. if you make more plates. but in order to do so he needed the rock-solid British Empire -with its financing. Its simple. We all know that concept (or we should). good government. Wedgwood refined the manufacture of China with production lines for painting. the style capital of the world. The increase of production and decrease of unit cost occurs when a business uses every known form of physical and social advantage. All of the things that made Britain strong and -stable also made Josiah Wedgwood’s marketing and high sales volume possible. Trade and clientry differ greatly from industrial commerce. skilled laborers on hourly wages and the customer base of London.
only a few decades ago. were proud of their home baking and would never have thought of serving a store-bought frozen pie. A chain bakery may have a production-line oven. however. but what makes it a chain bakery are its many outlets with large-scale marketing programs. electricity. Another example of changes in our social life has increased production and decreased unit cost is the supermarket floor plan. have come from changes in our social life. Picture a supermarket. Picture yourself eating a thawed frozen microwaved apple pie for dessert. High-school students are still hearing about the application of power to the production process in the form of steam. with barrels of pickles out front on the porch. Traditional women. The most significant reductions in unit costs. a cash register © Copyright 2004 Michael Phillips 99 . Our social life had to change before industrial commerce could be applied to apple pies. Adam Smith discussed them extensively in the mid-1700s.decreases cost. now picture an old-fashioned grocery in a cowboy movie. railroads and cotton gins. These are old tales of industrial efficiency. Thousands of people had to be willing to eat a store-bought pie before pies could be massproduced. High-school textbooks still teach that industrial commerce is tied to production lines and technology.
the industrial production and sales of a wide variety of foodstuffs has become more efficient. 100 . in his dark.made the watch a tool of productivity. The time was different everywhere. in large volumes.near the front door and the owner in a rocking chair. This standard supermarket floor plan compels the customer to move about the store the way the store wants him or her to move. Another example of consumers changing the way they live to make industrial commerce possible is the wristwatch. while decreasing the number of employees. Because we are willing to walk around grocery store aisles and stand in line at checkout stands. We’d have a hard time imagining one old-fashioned clerk in a rocking chair handling thousands of different items. Central. Standard time zones -Eastern. Before standard time zones were established. In the 1880s. The supermarket has an entry/exit area. Mountain and Pacific in the United States -. The supermarket is very different. long parallel aisles and a checkout stand near the entry/exit area. The floor plan increases the amount of product that gets displayed and sold. the few stable governments of the world created standard time zones. everyone set their watches and clocks based on what time the sun came up in their town. crowded grocery store.
Standard time zones made schedules possible. arrive. (Watches for railroad workers took the form of wristwatches for the larger working population). or slow down. In the absence of standardized published time schedules. The Magna Carta bound the nobles to support © Copyright 2004 Michael Phillips 101 . The Magna Carta was a contract between nobles and a central government to enforce property rights and trade agreements. The Magna Carta in 1215 was an early English document that provided fertile soil for the growth of industrial commerce. and running the train could be left up to the engineer at the controls. it was the conductor who made the decisions on when a train should leave. Industrial Commerce Requires Government Government is essential to industry in many other ways than establishing time zones. It was profoundly significant because it was a contract establishing the right of private property that made other contracts possible. Industrial commerce couldn’t take its first breath until government created courts and judicial systems to ensure the stability of contracts.Railroads needed conductors and a large staff to make even a simple train system work. speed up. Railroad people had to have their own complex time schedules to make sure that trains coming in opposite directions didn’t crash.
The list of other government functions that were essential to industrial commerce is long. home of the Magna Carta. shareholders are easier to replace than partners and create a greater need for managerial continuity. and Holland. The first countries where industrial commerce began to grow. a trading center with the best elective government in Europe. Once a working judicial system was put in place.the weak central government and bound the weak central government to provide a service that the nobles needed: protection of their property by sheriffs and courts. industrial commerce next needed corporations. and we take many of them for granted now. a few centuries later. In addition to greater potential for capital accumulation. • A common and stable currency. 102 . Partnerships existed long before corporations and coexist with corporations today. Government charters created the corporation. But the corporation was the government-backed innovation that was needed for industrial commerce to develop. were those that had long-established stable judicial systems: Britain. a brilliant invention for accumulating capital over long periods of time from decades to centuries.
© Copyright 2004 Michael Phillips 103 . People have long argued that industrial corporations are ungovernable and that in order to restrain their obsessive growth and monopoly tendencies. Criminal laws and enforcement have always been vital to minimize theft. Equity markets allow strangers to provide a business with capital. we need unions to organize workers to counterbalance the corporation power. socialism and free markets. Criminal laws and law enforcement. What Type of Government is Best for Commerce? What types of government are conducive to industrial commerce? Under what conditions and at what point are governments counterproductive? To provide useful comments on these questions we must try to look beyond centuries-old arguments about unions. A common currency creates larger markets.• • Equity markets to raise capital and price the value of the business.
The total is roughly 10. 104 . it has been introduced in more than 150 countries.• People have argued that governments should own all large corporations to keep them under control and distribute profits equitably to the citizens of the state. Since then. though it was not successful in all of them. Many of these 150 countries first encountered industrial commerce one hundred years ago. that nearly all industrial commerce should be conducted in open markets.000 government/years in which industrial commerce has interacted with different forms of government. Still other people have demanded that governments own all corporations. • • When we look beyond these arguments we find a vast amount of data to consider. That means we can get a large number of observations by multiplying the number of years a country has had industrial commerce by the number of countries. Industrial commerce existed two hundred years ago in northern Europe. and that many government services should be privatized. others more recently. Others believe that government should own very little.
labor unions. Belknap Press. The problem of untangling the relationship between commerce and the state is seen in a comparison of the United States and Japan. Chandler points out that Germany. France has managed industry as part of a national plan with industry supporting French foreign policy and labor union policy.The evidence from these 10. France. the equity shareholders and the banks all play a consensus role in industrial management. 1994. © Copyright 2004 Michael Phillips 105 . Japan and the United States have followed different approaches to government regulation of industry. Japan has used a bank-financed form of corporate control with four families of industrial companies working together as networks. Alfred Chandler covers much of this material in his book: The Dynamics of Industrial Capitalism.000 government/years is summarized most effectively in the descriptions given by Mancur Olson at the beginning of this chapter. There has been a wide range of governmental arrangements with industry. The United States employs government regulation to keep financial data public while exercising modest restraint on industrial monopoly practices. where the state. Germany has used an approach that Chandler calls stakeholder industry.
Americans have distinct God oriented religions. with federal. comparable 106 . those of judges. Four hundred years ago it became more centralized. including. It became strongly centralized150 years ago. America’s federal government spends a relatively low share of national income directly. The United States has one of the highest crime rates in the world. Japan also has a relatively low total tax rate. This country has more elective offices than any other. the Japanese have a combination of animistic and Buddhist theologies but no personal God. America has a highly decentralized political system. writing their own laws and administering their own affairs. Government bureaucrats pride themselves on their efficiency and sparse staffs. American government bureaucracy is bloated and notoriously wasteful. the Japanese are laggards. which means that in each four-year cycle we hold about one million elections. state and local governments all collecting their own taxes. Americans are the world leaders in joining voluntary organizations. in some states. Japan the lowest. More than half of all Japanese live in two metropolitan areas.Both countries are among the wealthiest large industrial nations. Japan has had a central government for over one thousand years.
© Copyright 2004 Michael Phillips 107 . America takes in the largest number of immigrants of any country. Japan one of the lowest. Unlike conservative parties in Europe. Arranged marriage and adult adoption assure mobility between steps on the ladder. Japan does not have a European or Indian style class society. It is structured in a descending social ladder from the Emperor at the top to a homeless person in Osaka at the bottom.to America’s but it comes mostly from a national tax. At the end of the twentieth century American had 33 million people living in the country who were born outside it. Japan is a narrow island that is mostly mountains. America has the most lawyers per head. America has the world’s highest military spending. The United States has no large socialist party. and never has had. with virtually no resources. its home-grown version has no aristocratic roots. Japan the least. Both countries have a high proportion of young people in universities and a persistent work ethic. America has an abundance of natural resources. Japan has had a modest socialist party and a highly structured society. America’s population is growing. Nor has it ever had a significant fascist movement.
Technology in both countries is fairly comparable. and Japan is far down on the Nobel list. alumni. America has the greatest differentials of income of any industrial country and Japan the least. financial matters. Japan has few immigrants a declining and aging population. Japan’s top corporations. with few exceptions. political. political and most importantly. Most outside corporate capital comes from bank loans within the corporate families. and those corporations have few or no connections between them. However. Japan aimed for low unemployment using government protection of small business. America has almost three times as many Nobel Prize winners than the next country (Britain). America has many hundreds of large corporations. America has had higher unemployment rates than Japan for fifty years. university or family. More billionaires live in Seattle than in all of Japan. Most American corporate capital comes from public market equity stock. belong to one of four families that provide very close ties on social.and the average age is young and stable. Laws protecting small 108 . either social.
Small business sops up unemployment and uses the least skilled workers in the labor market. Considering the differences between these two societies and knowing the intricate nature of commerce and state regulation. Japanese have significantly higher savings than Americans and very little consumer credit. General Points Without clear and direct conclusions from looking at the interaction of government and commerce there are. Today.businesses were implemented in the 1950s. nevertheless. The opposite is true of their American counterparts. Japanese consumers pay more for their market basket of discretionary goods than Americans. © Copyright 2004 Michael Phillips 109 . some general observations can be made: • There is positive evidence that freer trade is good for all commerce. both domestic and international.2 No clear pattern of success emerges from these general patterns of government/industry interaction. it is hard to see how any general rules of governance could be constructed to make sure that commerce thrives in both industrial societies. Japan has many times the number of small businesses per capita than the United States. as a consequence.
Some countries with vibrant commerce have high taxes.• There is positive evidence from Singapore and Hong Kong that commerce can thrive in a small city/state environment. there is a great deal more to learn about how government stimulates or retards commerce. In summary. Industrial commerce doesn’t need much hinterland. others have lower taxes and commerce does well. State ownership of industrial commerce is rarely productive. We know from Cuba that driving the entrepreneurs and managers from a country can stifle commerce for decades. we will encourage experimentation and observation. 110 . while still others have strange tax arrangements yet commerce survives. If we are wise. but it does need skilled. There are counter examples and strong disagreement on all these issues. educated and reliable workers. • • There is not much more strong evidence.
Summary The interaction between commerce and the state is complex and includes corporate structure. © Copyright 2004 Michael Phillips 111 . finance and detailed regulation. Even in societies that want to promote commerce. the most effective tools for success remain elusive and are the subject to on-going experimentation.
We don’t think twice about the disparity of their religious backgrounds. technology and urban living. as do atheists and those who follow no religion at all. Millions of Americans with a variety of different religions have morals. and that interaction could benefit from an understanding of commerce. Nevertheless people outside the modern world interact with modernity. © Copyright 2004 Michael Phillips 113 . These same Americans sit on juries and judge their fellow citizens in courts. Modernity is the result of a combination of commerce.Footnotes Introduction: Our modern world thrives only in parts of the planet. willingly or otherwise. Chapter 1 My personal view on morals and morality is that morality exists in an amoral world. Morals exist without any religious or super-human reference. Large numbers of people live in tribal societies and in communities that are distinctly not modern.
which traditionally encourages hard work and rewards deferred gratification. illegal and outrageous behaviors as well as wellintentioned ones. The public-interest law firm was Public Advocates in San Francisco. in the time of the Tudors. It is even easier to find moral outrages in commerce. 1601: Conversation. since it rewards obscene.Morals exist in a society as conventions of behavior. 1999. 2 Chapter 2 Mark Twain’s scatological book is still found in rare books rooms. 1 2 Newsweek: September 20. The 4 114 . as it was by the Social Fireside. The lead lawyer was Robert Gnaizda. It is easy to find moral virtues in commerce. Fortune magazine Japan Issue: September 1936 3 The Swiss watch industry has long concentrated on marketing watches through a wide variety of global marketing channels.
© Copyright 2004 Michael Phillips 115 . The core became the Swatch (Swiss Watch). the Swiss industry focused on developing a single electronic core for use in the myriad cases.) It may have been hard for thinkers living in the eighteenth and nineteenth centuries. a quartz mechanism used in nearly all Swiss watches. it is extremely rare that the seller or buyer is the winner while the other is a loser. 5 In static societies. many transactions. the other is the loser. to recognize that commerce was a non-zero-sum environment. (The term zero-sum came from mathematical game theory after World War II. When digital watch technology arrived in the 1960s. whether social. In commercial transactions. It was easy to overlook the power of non-zero-sum commerce and ascribe prosperity to growing world resources. Commerce has another positive social value: It is a non-zero sum institution. military or political.industry has historically tried to use a standard mechanical watch core with extensive variety in the case designs. when global boundaries were rapidly expanding. are zero-sum transactions where one person is the winner.
2001. Whorf and Sapir said. 1 By a “certified world” Rorty means to say that our reality is based on a variety of perceptions not on a god-ordained. 3 The Whorf-Sapir model argues that the most people from different cultures could hope for would be enough commonality to get along superficially. physical environment. using the Hopi culture as an example. concrete. who explained. 2 Whorf and Sapir were anthro-linguists in the early part of the twentieth century.Adam Smith and David Ricardo recognized that in voluntary commercial transactions. all parties benefited. people from different cultures who grew up having seen the world through their own language could never really understand people of another culture. Routledge. universallyaccepted. The languages of different cultures embody such different worldviews that 116 . but they didn’t have the powerful language of mathematical game theory to explain how socially valuable this non-zero-sum quality is for the common good. that a culture includes its entire worldview in its language. The Philosophy of Money. As a result. Chapter 3 All Simmel quotes are from pages 255-6.
Money or selfish monetary interests alone may motivate some individuals. and these multiplicities combine to create markets. done for monetary reasons. Whorf-Sapir believed that there is inherent incomprehensibility among cultures. including former communist countries and among the millions of people who have the ideology of rebellion that was promulgated in Marx’s nineteenth-century anticommercial milieu. This is a mistaken view and it does not come from observation of life in a commercial world. 4 The neo-Marxists claim that nearly all political and behavioral acts are self-serving.cross-cultural understanding is only a dream. This is a view that is found in many places in the world. This neo-Marxist view of the world is wrong because successful commercial behavior is premised on the basis that each individual has unique tastes and appetites. One of the pseudo-commercial worldviews that was excluded from this chapter is the widespread view that most people are driven by money and make decisions based on considerations of monetary self-interest. but the number of such individuals and the impact of their self-serving behavior is limited. © Copyright 2004 Michael Phillips 117 . People have a wide variety of personal motivations and drives.
. Control Systems & Regulators Convention Services & Facilities Convents & Monasteries Conveyors & Conveying Equipment Cookies & Crackers Cookies & Crackers -Whsle & Mfrs Cooking Schools Cooking Utensils Coolers-Evaporative 118 .The notion of homogenous human behavior (i. Consider the following list of headings in the San Francisco Yellow Pages: Contractors-Paving Contractors-Pile Driving Contractors-Pipe Line Contractors-Pole Line Contractors Referral Services Controls. not a reality based on commercial experience. 1 The nature of clientric business can be understood by studying differences. Business people know that human behavior has a variety of motivations and an even greater variety of commercial outcomes.e. Chapter 4 The following section is selected from Gods of Commerce to supplement Chapter 4 material on the three forms of commerce. all people are all driven by money) is ideology.
a bus tour of the city. © Copyright 2004 Michael Phillips 119 . Some of the cooking-utensil listings are retail stores. Some eighty of the 380 yellow pages businesses are traders. That makes them clientric.Cooling Towers Cooperatives Copper A yellow pages listing is about as close as one can get to business reality. because some unique stores. local hotels that depend on walk-in convention business. Two hundred of the 380 yellow page listings are industrial companies and appendages of industrial companies. receive 60 percent of their business from repeat clientele. including many national and a few international businesses. Not all retail business is trade. In most of these cases. customers come in only once and are not seen again. There are nearly 380 separate businesses listed in these categories in the San Francisco book. Most of the cookie listings are traders listed as retail bakeries. A few traders are found in the convention services listings: local print-copy shops. such as custom-made women's clothing.
such as the Fenwal thermo switch and automatic gas ignitor. That puts them in industrial commerce. These businesses have grown to fill geographic niche in their area. several contractors own large pieces of equipment that are cost-effective on large-scale jobs. Each control device or system is highly specified to a technical niche. Many of the distributor outlets work with a limited number of repair workers and engineers who are longterm clients. not very different from their industrial commercial ancestors a hundred years ago. Among many of these industrial companies are some that have clientric attributes. Some of the cookie companies are production lines. The conveyor equipment and the cooler companies are similar to the control systems companies. The copper companies are vestiges of the earliest industrial forms. heavily equipped factories that distribute worldwide. Slightly fewer than one hundred listings appear to be clientric companies. These pieces of equipment are made in low-cost. 120 . specialized industrial manufacturer. Most of the contractors work with a short list of clients over a long period of time. like Pepperidge Farms. nearly every business is the appendage or outlet for a large.In the contractor categories. In the controls category.
display and exhibit experts. consultants. not all run their businesses well. Convents and monasteries are not commerce.A few of the smaller contractors are really subcontractors who work for a short list of general contractors. The contractor referral services are oddities because their client appears to be the public. with repeat customers and established reputations. There are several listings that elude my three categories. These same clients provide word-of-mouth referrals for the remaining 20 percent of the revenues. equipment rentals. © Copyright 2004 Michael Phillips 121 . facilitators. The cooking schools service communities of special interest. convention organizers. Scattered through all the categories are especially skilled workers. specialized tour services. Convention services include catering services. and audio-video specialists. Most of the convention services are small. professionals and technical institutions that are clientric. Not all of them understand the clientric nature of their businesses. and not all will be in the yellow pages next year. specialized companies that work with a client list that provides 80 percent of their revenue. Some of the convention centers and bureaus are built with public funds and managed by government agencies for civic goals that are not 100 percent commercial.
Advertising has little or no relevance for a company that has a list of its customers and seeks long-term relations. Esprit de corps reflects the everyday working and operating environment of customers and employees. which imbues employees with a positive attitude. A trusting relationship is at the core of long-term customer interaction. Recourse is the touchstone of long-term relations. Recourse is the implicit and explicit message that the customer will always be recompensed in the event of errors. employee and customer esprit de corps. has five distinct characteristics: recourse. 122 . Maximum authority is delegated to employees with customer contact. when it is well run. I can’t categorize the five names listed under cooperatives. Distinct Clientric Characteristics A clientric business. open or transparent systems (especially the financial ones) and cautious expansion plans. Openness is the sine qua non of trusting relationships.but it is really the contractors who hire them. a general absence of advertising. Satisfied customers promote the business. omissions and misunderstandings.
Caution is important to clientric businesses. clientric business behavior favors honesty. metaphorical and behavioral ways. Business doors remain open in physical. The clientrist you know could be your doctor. and concern for the common good. People remember being mistreated and deceived. and will behave differently as a result. Clientrists are postindustrial in this most essential business worldview. lawyer. Because of this longer-term clientric calculus (and it is a calculus) arising from a worldview of social-resource optimization. caring. Such relations are generally founded © Copyright 2004 Michael Phillips 123 . graphic designer or business consultant of exceptional caliber. Clientric Business World View The clientrist’s focus on long-term customer relations requires a calculuslike approach to human relations that is very different from the short division people skills of industrialism. The number of clientric businesses in most readers’ friendship networks is limited. The need for this open-door worldview arises from the desire to establish long-term client relations. Expansion is seldom considered important if it might reduce attention to existing customers.
The opendoor business worldview is predicated on the trust that the business is safe to deal with. What distinguishes this person is his or her business worldview. In other words. Technology is helpful here. Failures of trust exist.on mutual trust and the customer's recognition of competence in the business. openness in finances and participating in or creating organizational structures that cope with the occasional lapses of mutual confidence. the client must be told the truth. and are dealt with methodically with the help of friends. Both trust and recognition of competence are in turn based on the known absence of deceit and the ready access to objective evaluations. This in turn favors openness in information. in the sense that a credit system will keep most frauds away from a business. such as legally binding warranties. consumer mediation groups and labor contracts. organizations or technology. The business must have public audits and publish financial statements. affiliations. can be found in many nations and in many skin colors. associates. The clientrist businessperson. Such failures are also of low probability. 124 . like a technologist.
These questions are uppermost in the clientric mind: What's really going on? What is the evidence? What are the numbers? What are the rewards? What changes will it cause? What is the most efficient way to do this with materials and people? What are the organizational implications and could they be helpful to my clients? The clientric businessperson’s first recourse to problems is always to mediation and establishing mutual advantage in order to preserve a friendly relationship.A worldview is created by experience in a family. 2003 2 © Copyright 2004 Michael Phillips 125 . in a culture and in a business. November 6. Pages 108 to 113 excerpted loosely from an editorial article in The Economist.
David S. The Rise and Decline of Nations: Economic Growth. ISBN: 0521367816 Simmel. ISBN: 0415046416 Smith. ISBN: 0300030797 Rorty. Scale and Scope: The Dynamics of Industrial Capitalism: Belknap Press. The Philosophy of Money: Routledge. Alfred D. 2nd edition. Georg (1858-1918). ISBN: 0674768027 Olson. Contingency. 1989. Mancur.Bibliography Chandler Jr. Reprint edition 1984.. ISBN: 0674789946 Landes. Adam. and Solidarity: Cambridge University Press. and Social Rigidities: Yale University Press. Stagflation. Irony. 1990. Revolution in Time: Clocks and the Making of the Modern World: Harvard University Press 1983. Richard. The Wealth of Nations 126 . (1932-1998). 1990.
Carroll.Taylor. ISBN: 0674824261 Whorf-Sapir hypothesis Lee. Language. Dorothy D. and Reality. Benjamin Lee. Englewood Cliffs. Reprint edition. University of California Press. Whorf. Freedom and Culture. Language and Personality. Sources of the Self: The Making of the Modern Identity. selected writings.J. 1987. Thought. Prentice-Hall. 1992. 1897-1941. N. 1961. Ill: Waveland Press. Foreword by Stuart Chase. Valuing the Self: what we can learn from other cultures. Edited and with an introduction by John B. Charles. Edward. Dorothy D. Culture. c1949 © Copyright 2004 Michael Phillips 127 . c1976. [Cambridge] Technology Press of Massachusetts Institute of Technology 1956 Sapir. selected essays edited by David G. Berkeley. Lee. Prospect Heights.. Harvard University Press. Mandelbaum. 1884-1939.
128 . an Introduction to the Study of Speech. Edward.Sapir. Harcourt. New York. 1921. Brace and Company. 1884-1939. Language.
1986. ISBN: 0140240945 Israel. 1992. Joyce. Harvard University Press. Liberalism and Republicanism in the Historical Imagination. 1986.Recommended Reading Appleby. Managing for the Future. Syracuse University Press. Jonathan I. The Control Revolution: Technology and Economic Origins of the Information Society. Truman Talley Books/Plume. ISBN: 0674169867 Douglas. The House of Rothschild: Money’s Prophets 1798-1848. ISBN: 0452269849 Ferguson. Mary. Clarendon Press-Oxford. ISBN: 0198207344 © Copyright 2004 Michael Phillips 129 . How Institutions Think. James R. The Dutch Republic: Its Rise. 1992. 1998. Peter F. and Fall 1477-1806. Penguin Books. Harvard University Press. Greatness. ISBN: 0664530136 Beniger. 1995. ISBN: 0815602065 Drucker. Niall.
Kuwabara. Shigeru. 1996. ISBN: 0375414118 Sowell. ISBN: 0465045898 130 . Japan and the West. Academic and Scientific Traditions in China. ISBN: 0860083381 Nakayama. The Mind and the Market: Capitalism in Modern European Thought. Knopf. ISBN: 086008339X Muller. Takeo. Basic Books. University of Tokyo Press. Jerry Z. Thomas. Migrations and Cultures: A World View. Japan and Western Civilization. 1983. University of Tokyo Press.1984. 2002.
© Copyright 2004 Michael Phillips 131 .
Index 132 .
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