Founders and Development
|Jun 15, 2020|
I had an excellent conversation with Samo Burja of Bismark Analysis. Samo is one of the most original thinkers I have encountered in the last two years, and it was great to have him share some of his ideas here. You can follow him on Twitter, read his writing, or watch his videos on Youtube. Here is Samo on Botswana and political stability - and how Rome handled the "succession problem". The manuscript of Samo's book is here.
You can find us on most podcast platforms as "Ideas Untrapped".
Tobi: Welcome to Ideas Untrapped and today I am with Samo Burja. Samo is a sociologist and he is the founder and president of Bismarck Analysis, a consulting firm. Samo is also an original thinker who has come up with his own theory of history that he called the Great Founder Theory. Welcome, Samo.
Samo: Thank you, Tobi. It's a pleasure to be on the show.
Tobi: Briefly please, explain the Great Founder Theory. You call it the Theory of History, can you explain it, in the most simplest form, for us.
Samo: Well, everyone has a theory of history. There are some people who believe that history is driven by technology, that technology is the most important thing that changes the world. There are others who think that it is the great people - the generals and individuals and scientists and artists. And still, others think it's driven by economic forces like capitalism and so on. So, everyone has opinions on it. Many historians have arguments on it. Many economists have arguments on it, and political scientists. Great Founders Theory which is my theory proposes that history is driven by the exceptional individuals who make the institutions that we all rely on - the founders of states, the founders of exceptional companies, the founders of religions, the prophets or the statesman or the industrialists of history - and that were you to remove someone from history where there to not be that particular individual, that exceptional and unusual individual, history could have gone very very differently. And also it's not just a way to interpret history it's a way to predict the future because it means that instead of necessarily looking at just the economic fundamentals or just the technological fundamentals of a country, you might actually want to look at: well, is there anyone in the country that might be a founder of new institutions? Because I think that be it a state, a company, or an organised religion, over time as you move away from their founding, these institutions can become corrupt or dysfunctional. So even if a country seems to be doing extremely well, if it doesn't have this type of person around who might rebuild the institutions or build them anew, 50 years from now, 100 years from now, 200 years from now, it will do worse. And a country that at first might not seem promising, might suddenly, like, shift to become the centre of the world if it had enough of such people.
Tobi: I found your theory on Great Founders interesting. One is that the conventional wisdom, if I can call it that, on thinking about institutions is not vested in people. There is a common saying that "oh, it's about the institutions and not the people", that's how you build enduring systems that can be fair, that can be just, that can order society. So, now, I think the fear...or in places like Africa where there is a long history of coups and bad leaders, how does [the] Great Founder Theory differ from the Great Man Theory of history?
Samo: Yeah, it's an important distinction to make, because not every powerful person is a great founder in this sense. They are often people who appropriate or merely direct institutions and organisations that others created. And then at times, if they tried to create an institution, they might not be very good at it. So the big distinction that I would make is that the individuals who can be exceptional - this kind of, like, far-sighted social engineers, I think they are extremely rare. I think they are not just rare in African history, they were in European history and in Asian history but, over time the fruits of their labour accumulate. An example in SouthEast Asia I think would be Lee Kuan Yew. I think that he was an excellent founder of the city-state of Singapore, which was previously a British colony and developed it extremely well. I think in Africa there are some leaders who are definitely worthy of administration, I think that I wrote an article on Botswana for Palladium Magazine where I examined the origin of Botswanan stability and how the royal family of the country actually made extremely good decisions as to how to approach decolonialisation (sic) and so on. And then Paul... I think Paul Kagame deserves, despite his critics and his critics do have a point that he is very much authoritarian in a way, I think he's done a remarkably good job of both developing Rwanda and healing the deep social wounds that the Rwandan genocide caused in the 1990s. And I can certainly relate to that because the 1990s was also the period where - you know, I'm originally from Slovenia, it's a country in the former Yugoslavia - that country was also torn apart, right? So this kind of, like, tearing apart of societies, I think that can be done by almost anyone. The building together of societies, the re-creation of them, the healing of them, the transformation of them, that is very very rare. So I think that that would be the big distinction.
Tobi: Yeah. One issue that you've written extensively about is succession, and...
Tobi: This is a very important problem with institutions and leaders and founders as well. Two examples: you talked about Kagame...
Samo: Hmm hmm.
Tobi: I've always found Kagame interesting because Rwanda seems to be in an equilibrium where Kagame does not really trust anybody as a successor, so that's why he's been in power for so long. Some of his speeches, some of the analysis that comes from...[trails off]. It seems like he sees himself as probably the only credible custodian of that healing process, from that horrible experience; and also in Nigeria here we had a very good example when we transitioned to democracy in 1999 and we had a president who had a particularly good second term in office. There were economic reforms, and there was growth. There was some form of shared prosperity in the society and he wanted a third term because he could not trust anybody, even within a system that he built or that was built around him. So explain to us - how important is the succession problem and how do civilizations and societies that have managed that problem really well, how did they do it?
Samo: It's an extremely difficult problem, and I think solving the succession problem probably distinguishes the most successful societies or the most long-lived ones from, like, the ones that struggle. In particular, I think that it has two parts: there is skill succession and there is power succession. Where skills succession means that the next person in a position has comparable skills and knowledge and ability to carry out an office. If say, hypothetically, in ancient times, a wise king is succeeded by a foolish son, right? The song can easily undo what the father had done, they can easily endanger the society. On the other hand, you might have a situation where there is a failure of power succession where, for example, there is a wise ruler but there is another wise individual who could come into power but doesn't really have the resources to reach for that position, even if the formal position still exists, it might be encumbered or disabled. There is such a thing as a powerless president. For example, today in Afghanistan, the president of Afghanistan is best understood as the mayor of Kabul. The power of this government does not extend beyond the capital city itself, with the outline regions still - 19 years after the US invasion, they're still basically governed by the Taliban or are directly governed by, like, basically US military forces. So in that case, the power just is not there to govern the space. Now, with regard to the trust between people, the trust has to be justified on a number of grounds. The very interesting thing here is if you consider [that] it's best to have a loyal competent person work with you and work for you and eventually when you have to go, as all people do, either because of old age or because of term limits or because you want to do something else with the remainder of your life, that person is the best person to hand it off to. It is, ironically, sometimes better to have someone who is loyal but incompetent than to have someone who is disloyal and incompetent, at least when it comes to politics. So, in an interesting way, as you point out, Kagame has difficulty finding someone or trusting someone. He has this fear of political opponents and I think this fear is locally rational but ideally, it would be best for society as a whole to have a higher level of trust. There are societies that have transitioned in history from lower to higher trust setups. One example I like to bring up is in the ancient Roman empire, there was a period of the so-called Five Good Emperors. One of these is Marcus Aurelius who is very famous for his stoic philosophy.
Samo: The Roman empire was in a period of crisis then, so this is not when it was most powerful. This was when it was engaged in civil wars where generals would fight each other and direct their armies against each other to try to win in these wars and become emperor. And the solution was very interesting, perhaps a little bit a matter of happenstance, perhaps a little bit a matter of design. The Romans had this institution of adoption where you can declare someone your son and you adopt them as your son even if the person was already an adult. So there was this interesting political trick that was only possible because everyone so firmly respected [not only] family but simultaneously also this kind of strange idiosyncratic practice of adoption where you spiritually make someone your son even if they are not biologically your son. Not all societies have this, only a few societies practice this in human history. So because adoption was [a] widely spread practice, when a Roman emperor who was old would declare a general his son, the idea of killing your son will just make you so unfit to rule that whoever was adopted as the Emperor's son understood that they were most certainly safe.
And on the other hand, they also understood that it's no longer in their interest to undermine the works of the previous emperor or raise themselves in rebellion because all they have to do is support the current emperor and then they get to their turn afterwards. I note for example that Botswana has a very good string of presidents where each president was the vice-president of the previous one and the vice-presidents are carefully selected for this kind of skill and partially also their friendship with the Botswana royal family, so this has helped them to avoid a lot of the troubles of other resource-rich countries. So that would be a different example than the Roman example. And a third example of a way this can be done is the Japanese practice of Moko Yoshi which is the practice of - in Japan, again there is a strong emphasis on family and there is a strong emphasis, however, also on honour and on company performance. And they well understand sometimes that your son might not always be...first of, you might not have a son, but secondly, your son might not always be the most talented at business. So the practice of Moko Yoshi is called son-in-law adoption - it means that for a wealthy industrialist or entrepreneur, they will try to find for their daughter a husband who has business sense and then the daughter marries the man with business sense but the daughter doesn't take her husband's name. Rather the husband takes this prestigious name and some of Japan's biggest companies in their past had made use of this. I think Toyota was an example and I think a few other of their household name companies.
This allowed it so that the next CEO of the company, the next head of the company had reason to trust this person because this person is their son-in-law and not only their son-in-law, [but] because the Japanese put so much on to the owner of the family name, this person would be interested in supporting it and supporting the original vision of the company. So this is another way you can produce this kind of trust. These are the three interesting examples - one is through marriage, another one was through adoption, and another one was through this long period of cooperation where you have someone that is your right-hand man, that you work with for 5 or 10 years, you are the president, they are the vice-president, and you sometimes would do interesting things where I think the succession went like this ...I mean I have to possibly check my notes on this but they [Botswana] also had some aspects of this familial bond that can overcome this distrust where, you know, basically president Festus Mogae served as Quett Masire's vice-president but then...
Samo: President Ian Khama who was the son of Seretse Khama who was the first president to try to lead this effort to leave the British empire and achieve independence. So he didn't put Ian Khama directly in charge, no, he rather put Quett Masire and this gave this opportunity that, you know... if Ian was not the best selection, you could have just gone with his vice-president but instead there was still this opportunity to rely on the family connection at the end of the day because someone who was like a close family friend, it would feel difficult for them to move against the son of someone else who was once their close friend and someone who had raised them up to the position of president. So, again, the relationship had to be developed before the country became independent in an interesting way, right? This initial friendship, because then the stakes are lower. So I would say that testing and building close ties before you are in the position of power might actually be the best way to get relationships you can rely on even after you are in power. This was a long answer and relatively involved, but I hope it laid out some of these mechanisms well enough.
Tobi: Listening to that bit, I'm wondering does not democratic ideals or what we have come to define as democratic ideal not conflict with these succession strategies that you laid out. I mean I'll give you an example.
Tobi: In party politics, for example, in Nigeria, politicians practice some kind of what you would call the "adoption system" but in social discourse, in political discourse, we have labelled it as "God Fatherism" and it is fundamentally perceived as unfair - that whatever comes out of that process does not represent the consensus of the people and so there's an instinctive reaction negatively...
Tobi: To that. So does democracy conflict with succession in a way, the way you look at history?
Samo: I think that democracy is very interesting. I will describe democracy as something that can deeply undermine trust or can deepen trust immensely. And it kind of depends [on] how well-functioning the society is in the first place. So I would say that in a well-functioning democracy, you might have people who compete and in public criticize constructively their opponents and proposed better plans for the good of the country. Yet then, when the president is elected or when the party is elected, the two parties or the two candidates who are rivals still trust the other side to adhere to [the] rule of law and believe that at this point, now that the election is over, the best course for everyone is to work together towards a better country and then you repeat this process every 4 years or 8 years or 10 years...so this is, I think, democracy at its best - where it allows you to express constructive criticism, advancement, the public good on the basis of the social fabric of already well-developed political relations, where there is a sense of shared interest among all the citizens of the country. Now, where it works the worst...I'm going to now reference back the example of the introduction of democracy in my own country Yugoslavia (I was born in Yugoslavia, I was a kid when it broke apart in the 1990s). The best way for Slobodan Milosevic who was a Serbian to win elections was to stoke the sort of resentment and anger of the Serbians that, to be honest... some real problems...there was a real conflict between Albanians and Serbians in the province, of course. But this immediately made it so that Slovenians, Croatians, Albanians, and others felt increasingly uncomfortable, they didn't want to live in a country that was completely dominated by Serbian elites in Belgrade. Before 1980, there was essentially, like, a dictatorial system where Tito was in charge. From 1980 to 1990, there was this tentative federal balance that was non-democratic, so there was this balance of power between the various wings of the Communist party, and then this balance of power was shattered by the introduction of democracy. So what I'll say here is - democracy is extremely powerful...it's a very powerful way to transform the balance of power of a society and put to the test the trust that already exist in a society or does not. So I would say that what is popularly understood as a democratic ideal which is that democracy itself will bring about higher trust, I think this is false. It is however true that high trust, high maturity, and high sense of, like, shared destiny and responsibility among a people, and among the elites of a people of a country, that this can allow democracy to express very very good government. And in fact, if you think about it, in a well-functioning democracy, the selection process should work better than, say, in a monarchy. Again, the hypothetical example of a monarchy that's hereditary, you know... the first son inherits or the kingdom is split between all the sons of the king. These were the two methods of inheritance in the ancient Middle East or Europe in medieval times.
Either one of those systems is kind of a throw of the dice. It's sure that the successor will be loyal, at best, if they're good son but they might not be competent, and in a well-functioning democracy and a high trust system, you should, in theory, have this. But I think it's a very delicate machine, I think it relies on [the] rule of law, and it relies on elites that feel that there is [a] common ground. So even though it's a democracy and there is a will of the people, even in democracies some people are more powerful than others. I think this is a fact. If you look at modern... any western country you want to look at, some people are wealthier, some people are more powerful, some people are more influential, some people have more sway over the public's opinions, some people are charismatic - whether it's America or Canada or Germany or any of the Asian democracies such as South Korea or Japan, it works this way. The elites still matter. I think that in this sense, the best way to implement a democratic system is to first create this sense of shared purpose and shared destiny in a people, and to balance the interests of all the groups that live in the country. And I think here I would reference the work of Machiavelli who wrote in one of his books, I think it was on the Discourses on Livy - he said that the constitution of a country, be it a monarchy, a republic or a democracy is always the work of a single man, the single individual. I don't think that's quite true. I think it's usually a small group of people, organised around an individual, like say, America's founding fathers were... but I think it says something very real. I think democracy has difficulty producing the preconditions for its own success.
The question is, do you want to be friends and do you support the entrepreneurial young man that doesn't have much money to his name? - SB
Tobi: That's interesting. That sort of leads me to my next question.
Tobi: Are there deep roots element to having a great founder? And here is what I mean: from research in cultural evolution, I think from the works of Joe Henrich and co., societies are classified as either low trust or high trust...
Tobi: And we know that high trust societies (they) tend to handle some of these problems like (we've talked about) succession really well. So are there cultural or biologically intrinsic elements to societies that managed to invent credible institutions or produce great founders, at least, more than other rival civilizations?
Samo: Well, there is an interesting question of what exactly is producing great founders, right? I don't think I really know the answer to that, I believe that an openness to exceptional skill is very worthwhile. So a society that values the great scientist or the great artist or perhaps be kinder to the great religious and spiritual leader or the wise and thoughtful political leader or the very productive and industrious economic leader, and importantly it will be open to what these people look like before they are successful. Like, everyone wants to be friends with Rockefeller when Rockefeller is already rich. The question is, do you want to be friends and do you support the entrepreneurial young man that doesn't have much money to his name?
Tobi: Uh uh.
Samo: I think this kindness to what the beginner's stage looks like because if you imagine someone that can go on this trajectory to shape a society - to, like, notably improve it - this person is going to be saying some very strange things when they're young. They are not going to be doing whatever everyone else is doing. His parents might be like "well, you should become a lawyer or a doctor" and instead this person has this seemingly crazy dream that just later on in life turns out not to be crazy. They might still, as part of this dream, receive a lawyer's education. But instead of, say, going to a law firm, they might create either a political party or they might start lobbying for the change of a particular law that enables a particular kind of business or city government or they might run for an office or they might spend 10 years reading books and being a scholar for some reason that's very difficult to explain to others. So there has to be in a society, I think, a desire for excellence, some tolerance for eccentricity or at least the harmless kinds of eccentricity and an encouragement or at least... it cannot be too focused on trying to stamp out creative. Now, ironically, I think some very high trust societies will actually suffer some long-term problems because they have this philosophy where, you know... you hammer the nail that stands out. I think in say modern Denmark or Scandinavia and perhaps also in modern Japan. It's actually extremely difficult to be someone that does something different. Partially because things seem to be working pretty well - there is a healthcare system, the streets are clean, the economy has been stable, everyone's been rich for as long as they can remember - so why are you being a troublemaker and saying you do everything different from everyone else? Who are you to think that you are special or that you know better?
So this actually, I think, in the long run, might make Japan, again, and Denmark fragile. And I think this is an advantage to say, some other rich countries such as the US and over time more and more China [which] actually still retain this possibility of being contrarian, not in your words necessarily. It's not respect for necessarily people who are disrespectful to society at large or loud (though certainly such people that can succeed in the United States), it is more [of] a tolerance for a very different way to approach your career and intellectual and economical life. And then I'll add some more components to this - so I had this drive for excellence, this tolerance for eccentricity, the tolerance for the beginner to choose a different life path than other talented young men and women might choose. I think the availability of local traditions of knowledge is immensely important. Where, by traditions of knowledge, I mean the possibility of finding mentors who themselves are exceptionally skilled or exceptionally successful or exceptionally insightful.
Historically, there were some universities that played this role and they didn't necessarily play this role through "well, you know, the students and the students are taught by the teachers", it's more as... if you went in medieval, times in England to Oxford, it was just a place where all the smartest scholars of Europe had gathered or say the Cervon in France. And whether or not you were a student of the university, if you could travel there, you could talk to them and you could write with them and you could listen to them. The availability of this knowledge immensely sped up progress and similar things can be said of Florence in the Renaissance. Florence is a city in Italy renowned for its great art. If you were a sculpture or a painter, your craft - your art - will progress much much faster if you could go to Florence and ideally apprentice yourself to someone. But even if you couldn't apprentice yourself, merely walking through the streets of Florence - they had the practice of having these workshops that were open to the street, you could actually just literally see what people are up to and what kind of stuff is produced. And it had this, again, this culture of critique where they would have high standards, so they would examine critically what artists are making and compare it to each other and they were quite direct and open about it much as Italians sometimes are even till today - they are quite disagreeable. So I think this availability of other experts, people who perhaps themselves are not great founders but have quite great mastery in things like rhetoric or law or human organisation or technology or understanding of the country and its issues. The availability of such people can greatly aid great founders. So this perhaps is just kind of the preconditions for this and I'm happy to comment on any specific countries or regions but each of those is like quite involved things... so...
Tobi: Let's talk about China.
Samo: Perfect. Perfect.
Tobi: Interesting article, by the way, yesterday. I read it. Packed with so much insight. And of course, China, in the last decade, has been the most important economic partner to most African economies, so whatever happens in China, the extension of its global power reaches every corner of the African economy.
Tobi: You talked about Deng Xiaoping and how he managed to handle the succession problem and Xi who is currently torn between keeping the fire of Marxism burning or watch it die out with modernism and all. How big a threat is the internal political contradictions that China face right now? How big a threat is it globally?
Samo: Well, I think that China is facing an immense challenge, I'm very glad that you enjoyed the article. The article in Asia Times outlines my position which is that they did an immensely good job of resolving the contradiction of how to have economic growth with a Marxist ideology. But the problem is they do need the Marxist ideology to keep their political system together. So the succession problem there is driven not just by this difficulty with Marxism where it can always be interpreted in this way that actually shuts down capitalism and economic production - where if the successors of Xi don't take it seriously enough, they have no political principle with which to maintain power and perhaps this could be replaced by something like a democracy but I think that's not trivial at all. It might very easily shatter the country apart as it had numerous times in its long history. China has this long history of dividing into smaller fighting countries and then reuniting. These dynastic cycles have happened several times in the twentieth century. They had terrible civil wars at the start of the 20th century. So it's very risky to undermine the political structure of the country, it's very risky. And then on the other hand, if you take the Marxism too seriously, especially if you take the Maoism too seriously, you might end up destroying this engine of economic growth because then how can you have in a communist society billionaire's, which China obviously does, right, Jack Ma and so on.
I think that civil society enables a civilization robustness. Hyper centralised systems can seem very efficient but they can be very fragile. As soon as the centre fails, everything fails. - SB
The succession problem has an even more fundamental issue where while Chinese industry allows for exceptional and strange individuals, like a lot of the billionaires are somewhat eccentric, their academic system does not. Their scientific progress is much slower and the students are very very good students but they don't pursue bold research and a lot of the members of the Chinese Communist Party go through the somewhat academic selection process. And then there is another selection process of "well, which party member advances within the Communist Party of China?" Well, it's the one that doesn't rock the boat. It's the one that's, you know, quiet and agrees with the policy and supports the policy. And in an important way, of course, you can have someone like Xi who he is very reserved in speech, very obedient, plays by the rules and when they come into power they pursue their bold plans they had all along or they acquire and grow into [the] office and become bolder. But for the most part, this is just going to be "yes men" and Xi is the last member of the generation that saw the possible failure of the Communist system. He saw the failure of it in his youth when his family and he himself were targeted by the Chinese red guards during the so-called Cultural Revolution. For a few years, he spent his childhood exiled in the countryside feeding pigs, and that probably stuck in his memory. He understands how despite, I'm sure Xi is... I’m sure he believes in Marxism but he understands this failure part of it and then later in his life he saw the collapse of the Soviet Union.
We have to understand that for the Chinese, the Soviet Union in the 1980s was kind of the elder brother, just as in the 1990s Eastern Europeans might admire the wealth and development of Western Europeans. So in the 1960s and 70s, Chinese communists both admired and envied the global power and the technological development of the Soviet Union. So seeing the Soviet Union collapse was this big shock for the communist part of the world, only a few communist countries stayed communist after the fall of the Soviet Union - North Korea, Vietnam, Cuba, and China and that's basically about it. All of the African and European countries that had experimented with socialism basically abandoned it, it was no longer a viable system. Xi saw this again as a young man, and already on his career...so in a way, he saw both of the failures in [indistinct word].
Samo: He is going to be in power for a while more and I don't think anyone who is of a younger generation has that sort of experiences. All they have is the experience of maneuvering in a Communist Party, ruling an already fairly developed China. So their intuitions and knowledge of what does failure look like for political system or how do unwise decisions come about? it's going to be in a way much impoverished. So I think there is a knowledge transmission problem here. I think power succession works fine because the Communist Party has such control over the country but knowledge succession is a big problem for them and they have a lot of difficulty solving it.
Tobi: Somehow I wonder whether these are not (maybe they are, maybe they are not) symptoms of increasing prosperity. One very important point you made in that essay was how much order is necessary to create and maintain a market system. I think a lot of people underestimate that. We all like to believe in this Hayekian vision of an emergent market. So...
Samo: Like an idealized market set of rules where people exchange goods and they, sort of, discover what's...together they discover what's the best economic outcomes through the price system and so on.
Tobi: Yeah, yeah...I mean, we've been taught to believe that. So when I look at China, people like Ang Yuen Yuen have said that Deng Xiaoping reforms were based on having a decentralized approach to policy and here you have Xi, again, who is so centralised in his approach to economic management. But if you look at cosmopolitan cities like Shenzhen and every other metropolis in China that have seen incredible prosperity in the last 40 to 50 years, isn't the current tension a necessity? That is, when people make more money, when they become more successful, they demand more rights. They become less obedient, they become less conformist, what do you think of that?
Samo: I think that there is a strong set of prerequisites in terms of enforcing these relatively strong rules that enable personal liberty in the first place. That you don't have to fear whether or not your store will be expropriated and that you can rely on [the] courts if someone else, say, double-crosses you in a business deal, those are absolute absolutely massive. It just means that people, once those two things become true, then the most rational course of action is to participate in the market and benefit from the market. Until those things are true it's very difficult. And again what is supporting those courts? What's supporting that political order? Well, that's not trivial at all. That took a lot of work in the first place. And I think that this development that we saw in China was that... the aftermath of the Cultural Revolution was a quiet realisation among the remaining members of the Communist Party because they had been purging each other (those internal fight), was that "you know, this got out of hand, I would like more security in my political career. I don't want to be killed on charges, I don't want to be imprisoned, I don't want to be exiled, I'm going to work together with the other people to make sure nothing like this can happen again. And as a side effect of this almost kind of self-interested political aspect, this enables a reformer like Deng Xiaoping to produce something that has not just given political safety to this party officials, but gives economic and political safety to everyone in the society, at least to a much higher degree than was previously available. I'm not ignoring at all the fact of how heavy-handed the Chinese government can be, I'm just pointing out that the mechanic of the change that enabled this broader liberty was partially driven by the people who are already powerful. You can't obviously have this be driven by everyone in [the] existing elite, but I think every reform of society has had one sub-section of the elite interested in change and bringing in new people as allies, who previously were not part of the old elite to become part of the new one. So, there is a change in the ruling coalition... that can happen. And I think often those can be very positive if designed well and can result in what's essentially this higher degree of safety. And I think once the safety is guaranteed, then there's more room for personal expression and this bottom-up order.
Tobi: Interesting. Interesting, Samo. So I'm just going to toss out a few theories and framework and I want to hear your reaction to that and weather GFT affirms or refutes that. Acemoglu and Robinson talked about inclusive and extractive institutions, what do you think about that framework?
Samo: I think that inclusive or extractive institutions is a good path... it's an interesting frame, right? I think that in the real world, an institution can be both inclusive and extractive. So I think there is some insight there, but I think my perspective on institutions is that they can easily combine many things that seem mutually contradictory. So I'll say it sometimes gives the correct answer but it's basically not as total as it's presented.
Tobi: Hmm. In their framework, at least they've extended their theory with their new book, they talked about this narrow corridor where... I don't want to call it perfect, but this balance between the power of the state and the freedom of the civil society as this zone where prosperity sort of exists. Is that...I find that hard to believe somewhat despite all the evidence they marshalled in their book and other research papers...
Samo: Uh-hmm, Uh-hmm, Uh-hmm...
Tobi: So what role does civil society play in GFT?
Samo: In GFT, civil society is the space where new institutions can be designed without the approval of the centre, without the approval of central power because GFT has this self component of high-medium-low...where I think civil society is the space where the middle powers can be built. In other words, to build a great successful company you ideally don't need to have that many government friends. To successfully pursue a new political ideology or new social or ethical ideology, you shouldn't necessarily have to fully wrestle with everyone in society immediately... so, again, another additional aspects of this is I think that the civil society represents this very important redundancy. Redundancy in the positive sense where if you are on an airplane and the electronics of the airplane fails while you are in the air, you really hope that there is a backup electronic system; or if you are in a hospital and you are recovering and the electricity goes out you very much hope that there is a power generator attached to the hospital allowing whatever equipment that is needed for your health to keep on running. I think that civil society enables a civilization robustness. Hyper centralised systems can seem very efficient but they can be very fragile. As soon as the centre fails, everything fails. A strong civil society on the other hand enables not only [a] healthy competition and experimentation which of course should not endanger the centre or should not endanger the coherence and common destiny and stability of the civilization or society, but it enables a backup. So if the centre fails, there is something that is not too far from being able to become the new centre.
Tobi: Interesting. Let's talk about technology for a bit, Samo. One of the things that this notion of catch-up growth is built on in economic development is that if you can facilitate technology transfer between a nation that is advanced to a nation that is behind, then you can engineer some form of economic growth. But you also have this concept of social technologies that in my own interpretation do not transfer so easily. What are your thoughts on that?
Samo: I think this is very much true. I think that it's very easy to transfer, say, the adoption of a physical technology. It's like not that hard to have the users...you know, everyone has then a smartphone, right?
Samo: It's a little bit harder to have it be sold that the workers and managers exist to run a phone factory, on the other hand, that's a little bit more difficult. And social technologies play a role in this and I think the transfer of social technology is something very interesting and tricky. I feel it is important to note that naively trying to completely copy social technologies from a completely different society can have disastrous or ineffective consequences. Because, in fact, there are already social technologies in whatever society. There is no society without its own ecosystem of highly specialised social technologies. The beautiful balance happens when one is able to learn from other societies and then customise what is introduced. I'm going to use the example here of 19th century Japan. Nineteenth-century Japan, sort of, forcibly opened to trade by Admiral Perry, basically, they are behind on military technology.
They understand very well in the aftermath of the Meiji restoration that it's not just the adoption of Western science nor is it the adoption whole-scale of just Western culture and views, but they are very selective. What they do is they send their most talented students to Germany and the United States with specific missions; some of are tasked by the Japanese government as representatives to learn everything they can about how the officer system work in Germany, for example, in 19th century in Germany, 19th century Prussia? How do the ranks work? What kind of discipline and training do the soldiers go through? And they return changing the Japanese army from this relatively archaic system that's feudal, that has samurai because if you arm the samurai with the machine guns and whatever, they're not actually using the artillery, the equipment well nor are they fighting coherently or employing the correct tactics. So the army would in effect be terrible. But they copied the Western system of ranks and training - everything up from the military academies to the organisation of the provisions. They go and observe it. They participate in those armies and then they return to the country, and with the full political backing produced this transformation. And then for the ones that go to the United States, they observed the organisation of railway companies and how American companies operated internally.
And note this, of course, was a very different America. This was an America that was still at the frontier - the transcontinental railroad was barely built, so there were definitely people there that knew how to build a completely new railroad system, how to finance it, how to even deal with security issues - and then that transfer goes back to Japan. And then there are people who are in London just working for several years as basically shipwrights that return and then oversee the construction of the first ship. So these are not just technical skills, all them are learning some technical skills but they are also learning things like what does a relationship look like between a soldier and a commanding officer? What does the internal organisation of a shipyard look like? How do shipyards connect with funding and with resources? And how do they select skilled labour vs unskilled labour? How do they enforce workplace discipline? What do you do if the shipwrights come drunk to the shipyard, how do you respond to that? These all seem very trivial everyday problems, but for the most part, we rely on our social understanding, our cultural, our social technology to see what is acceptable and what are the expectations that should be set and should be respected and how to resolve various kinds of conflict and how to reach various kinds of decisions - these are all things that have to be patented. Yet, despite all these expeditions to do this learning, they intentionally combined this and pursue this strategy where they picked and choose which of these practices were compatible with Japanese society. So Japan stayed Japan and successfully industrialized… and it was unsuccessful during World War II obviously, but even after WWII, Japanese society remains distinct and actually in some ways functions better than Western societies. Like, if you go to their high-speed transit, it's maintained at a higher level than you see any western country. So they combine this with some of these strengths that they have... this very broad attention to aesthetics [and] this high level of politeness that they had inherited from that particular kind of feudal society. So yeah, you have to live in a new society, I think. You have to observe it happening, and then not only do you have to live there, you have to return; and not only do you have to return, you mustn't change everything. You must change just something very narrow that works on the strengths of the other social technologies available rather than trying to wholesale imitate something that ultimately has its own flaws.
Tobi: Economist Gareth Jones has this concept of hive minds where he says national IQ matters more than the IQ of an individual person and these are correlated with how successful and prosperous a society is. I'm not even going to ask how true or false that is but are higher IQ societies more likely to have great founders than not?
Samo: It's a very interesting question. I mean IQ is one of those things that it might not be a good measurement, it might be a good measurement in some circumstance. I think that... yeah, I think there is whatever (I won't measure it with IQ)...
Samo: But I do think societies with intelligent people or with greater respect for intelligence or with greater ability to produce intelligent people, I think they do have an advantage here, yeah. You require also other things because as I noted, you might have extremely intelligent people that are however doing exactly the same thing that everyone else is doing. If you imagine a classroom of very very diligent student that mostly to just do the same thing that all the other diligent students...like, that might result in like, say, some well-run things. It might like result in trains that go on time or on factories that can rely on a high level of skill of their workers but the problem is those same students would never have built the train system in the first place or would never have pushed for its creation nor would they have ever pushed for the creation of the factory. So there are additional factors here. I remember reading some articles about Gareth Jones's book, I will say where he's very very right is that if you have a higher culture of intelligence in a society, it becomes easy to not have to worry about things. You don't have to worry whether trivial everyday things are taken care of, you can focus on the truly difficult parts. Again, you can rely on the train that takes you to your class to be there on time, for example. That's like easier, it's not just a matter of organisations, [it's] also a matter of, like, the competence of the rail workers and so on... and these small everyday differences, if you imagine them just through the lifetime of a potential great founder, they make a massive difference.
I'm not sure I think that you need to have absolutely all of society be like this, I think it's actually sufficient to have a city that's intelligent in this way. Like I give the example of medieval Europe and the city of Oxford. I think it was quite sufficient to just have Oxford where there were a bunch of smart people around. I think it didn't much matter whether the rest of England at the time was very intelligent or not.
Tobi: Hmm. That's interesting. You also talked about Life Players in your book which I greatly enjoy and for the audience, I'm going to put up a link to the publicly available manuscript for the Great Founder Theory book. How can one recognise Life Players in society or in an institution?
Samo: I think Life Players are going to the people that have succeeded at very very different tasks. So they are going to be these individuals that have, perhaps, either changed careers (two or three completely different careers) and have been successful at all of them; or completely changed their interpersonal style and were as successful when they were strict as when they were jovial, when they were easy-going or people who have done intellectually completely different things. So what you're looking for is not only a very high skill in an area - again, it's very possible to be extremely skilled in an area and ultimately not be that well-adapted - what you're looking for is the combination of both skill and execution, intentionally observing their environment and success at transitioning. So (a) success at transitioning to completely new strategies and this might look like an entrepreneur that has built a successful company in one industry that [they] then specialise in a different industry and very quickly build a successful company there too. Elon Musk might be a good example where he both has created this business that's a car factory that makes electric cars - Tesla - and has also succeeded in aerospace with his company SpaceX which recently brought American astronauts to space again for the first time ever on a privately built rocket rather than a rocket built by NASA.
Tobi: Uh uh.
Samo: A different example of a Life Player and I have to emphasise here when I say Life Player, I don't mean I agree with everything the person does. I'm just observing that they have the skill and adaptability. I think Vladimir Putin has showed over the last twenty years in Russia an extreme adaptability where Russia pursued many different strategies to try to maintain its position in the world, and Russia right now punches above its weight. For example, the annexation of Crimea was completely inspired. Nothing like that had happened in Europe before...
Tobi: Uh uh
Samo: And it was done with, like, killing almost no people, I think something like three or four people died. It was incredible how they orchestrated the mere surrender of the Ukrainian army because the Ukrainian army was so confused and honestly scared with the appearance of these Russian soldiers that, note, were even not officially Russian soldiers. They were wearing no official flags or patches, so they wouldn't give any answers as to who they were. They could plausibly say that they were Ukrainian because Ukrainians and Russians (they) look similar, they speak very similar language, there's a Russian minority in Ukraine and...you know, Crimea declares independence, and then immediately after declaring independence asks to join Russia and Russia says "yes". It's kind of amazing how that can happen. Not saying it was good for Ukraine, definitely, it was good for Russia, I think. And this results in this very creative process because there is no way in the world that Putin ever planned for there to be a civil war in Ukraine, but having the fact of the civil war happen, he and his team very quickly moved tens of thousands or hundreds of thousands of people and carried out a military operation that had never been performed before by the Russian army. The Russian army has a long history, many centuries ago but believe me they've never engaged and subtle stuff. They usually had this very overt, very heavy-handed interventions in other countries. If you think about it like this intervention in Hungary in the 1950s, in Czechoslovakia in the '60s, they just roll in the tanks and, like, assert authority. And here? No no no. Much more flexible, very subtle. And because the conditions were so unpredictable, this is how we can know that this was not planned a decade in advance. This was a quick adaptation over the course of, possibly, as little as six months to a completely changed situation. So I think that even if you were within the same industry, if this company, if this government, if this organisation, if this institution adapts quickly to massive changes, that's a strong sign that a Life Player he is at the helms. Because no automated system continues working when the operating conditions changed. It stops working if it's the preconditions are not met.
Tobi: Hmm. One of your ideas [that] I've also found very interesting is the concept of Intellectual Dark Matter. How can a society benefit maximally from its intellectual dark matter - the tacit knowledge that's around?
Samo: Intellectual Dark Matter refers to this concept that makes the analogy to physical dark matter because currently when the physicists and the astronomers look at our galaxy and they count all the stars and put together all the mass, they realise that there must be much more mass there than only what's visible...
Samo: Because, otherwise, the gravity wouldn't be strong enough to keep this spinning galaxy that we find ourselves in and other galaxies together. So they don't yet know what this missing mass is but they are investigating it. And with Intellectual Dark Matter, I think if we put together all the books, all the stuff that's on the internet, all the stuff that's recorded, I think we still find that there is missing knowledge. There is knowledge and skill that we have not explicitly, formally recorded - written down or put into words that deeply matters. And once you start thinking about that, it's very easy to come up with examples of stuff that is very difficult to put into words or put into writing. The skill of a heart surgeon that saves the patient's life. Like, that's a remarkable set of skills but how do you put into words how to perform a heart surgery? Very very difficult, right? Takes a lot of words. I have an article titled "How YouTube is Revolutionising Knowledge Transfer" and I point out that...
Tobi: Yeah, I read that.
Samo: I point out that for a good enough camera, recording the hand movements in these very skills, and it doesn't have to be just heart surgery, it can be as trivial as cooking or perhaps the way you treat complex machinery... recording the video and others watching this video might be much much better way to convey such knowledge. I also think that we in society, in general, like seeing the results - we like seeing the finished essay or the finished theory by a Thinker. So if I go back to the world of abstractions to either philosophy or science or whatever, we like seeing the finished theory.
What we don't see is all of the crazy or stupid ideas that this very intelligent person came up with before they got the right idea. They usually do that on their own or with a close circle of friends. So, one might be tempted to think and look at an extremely successful thinker and assume that they were always very polished, that they were always very eloquent, often this is not the case. Often they are immensely long learning period. Now, I admit I might be a little biased here because I did spend most of the last decade pursuing this kind of, like, thinking, reading, investigating and for most of this time period, people were not immediately interested in my ideas.
Samo: But about two to three years ago, the material not only clicked together but I found the words to express what I, to myself, felt I had understood for several years before, I just could not really find the way to relate it and show to others in a short period of time how in fact this is useful to them. So I think all of these things form part of Intellectual Dark Matter and there is much more. There is, for example, we might not know what the exact process is that allows you...that allows Elon's team at SpaceX, engineers at SpaceX to make that rocket, and we might not even have that available anywhere because it might be classified. There are probably rules, I actually know that there are laws in the US that prevent SpaceX from simply explaining how they're making this vehicle to a company based in a foreign country. They don't want to teach all the countries how to make rockets for obvious reasons, and more importantly, SpaceX probably doesn't want to share its rocket designs with Boeing - their competitor.
Tobi: Uh uh.
Samo: So there is also an element of proprietary knowledge and trade secrets for stuff that is understood explicitly, stuff that can be put into words, can be put in a document but the person who has this knowledge wants to keep a competitive advantage; sometimes for very good reasons or the organisation that possesses this knowledge doesn't want to share it. So, that also forms a type of intellectual dark matter - it's knowledge we can't directly examine.
Tobi: Interesting you talked about YouTube. The global pandemic has seen an increase in virtualisation, are we going to see a reform in education away from the classroom and a reduction in direct instruction?
Samo: I think that we will see an increase in autodidacts - so people who know how to learn on their own. I think, however, that most people will return to the classrooms once the pandemic has died down. I don't think there will be permanent remote instructions and I think the reason for this is that the performance seems to be much worse. It seems to actually be the case that unless you are inherently interested in the material. If you're just a kid who's going to school or taking online classes because you have to take online classes or because you have to go to school, it seems your performance is going to be worse. You're going to learn less than if you physically go there. And I think that for autodidacts, there is going to be an abundance of resources - everything from recorded lectures to tests made. So it's going to improve those chances of those who are seeking knowledge out of curiosity primarily, or out of self-development and professional development; but for the majority of people learning, I think this transition is going to be temporary. I don't think it will be a permanent shift.
Tobi: So, Samo, it's kind of a tradition on the show to ask this final question. What's the one big idea that you want to see spread globally?
Samo: That's a great question. I think if there is one idea that I would like to put in everyone's minds or everyone's hands, it's this realisation that...I think that the surest sign of good knowledge is the ability to act on this knowledge. So I think that there is some deep confusion as to when knowing things and when doing things - how do these two relate to each other? And I think if only we understood that there are many things that have the appearance of knowledge, such as eloquent speech or perhaps particularly good writing that don't carry the substance of it. We should always observe the practice of the individuals and organisations claiming to have knowledge. For example, the WHO...I'm sure it's made of many excellent experts - they individually know many things about the coronavirus but the organisation as a whole despite claiming to know, in its public communication seems incapable of relaying that knowledge. So I think the result should be "well we should take them less seriously on the coronavirus". And if this map between who is believed to have knowledge and who actually has knowledge, if we improve that map, as a species, I think that our ability as human beings and our societies would really rise. It will be a remarkable thing to see and I think the societies that went through golden ages, I think they basically had these happy periods where the two coincided. You know, times like the Renaissance or whatever.
Tobi: That's a great idea. We're sure to help you spread it over here at least.
Samo: Thank you so much for having me on the show.
Tobi: Yeah. Thank you so much, Samo.