Monday, July 19, 2010

Sovietization of American business

Once the messianic fervor of the Russian Revolution ebbed back into ordinary life, the economic privations of living in the Soviet Union inspired mordant jokes. "We pretend to work, and they pretend to pay us."

I recently saw that one of my Facebook friends here in the U.S. had joined a group using exactly that jibe.

It was well known in the Soviet Union that wave after wave of agricultural collectivization had failed. Stalin killed the bourgeois kulaks, but that only brought hunger. A huge percentage of Soviet food was actually grown on private plots on marginal land, rather than in the huge mechanized fields that stood only to benefit the state.

The neo-classical economic conclusion was that this proved that the socialist man was impossible, that only economic organization of society in a way that appeals to self-interest is viable. Free market conservatives had been saying this all along, and this vindicated their ideology as the economic consensus of the West.

No one would argue that the Soviets had it right. (Well, no one sane.) Yet the logic of the neo-classical economists was transparently wrong. A command economy failed, but there were other options besides a free market economy untempered by government influence. And the command economy did take seventy years to fail fully, which is quite a long time and suggests some ability, smaller than our system's to be sure, but still some ability to provide value.

Even in the 1970s, in the depths of Brezhnev poverty, there were indications that the Soviet failures of central planning were not the whole story. Another jibe was making the rounds: There's no economic system under which Russians work, and to the contrary there's no economic system under which Germans don't work. There was also the joke about Brezhnev's babushka asking him, "What will you do when the communists come?"

Americans culturally work hard. Oh, sure, during the challenge from Japan, we were all lazy, shiftless, no-account buffoons, but that was a lie. We may not work ourselves to death in the acute sense of karoshi, but we expend more time and effort on work than nearly every other culture. Even more than the Germans.

I work for a major American multi-national corporation, and I've been noticing something odd. Senior managers have been responsible for their silos and have perennially acted as self-interested agents, but they've counted on their lower managers and individual contributors to put aside their own incentives and make decisions that help the company as a whole succeed.

In short, they want us to be socialist men, of course in the context of this capitalist enterprise. When faced with a task that we're not compensated for, we're expected to take up the slack and altruistically provide the out-of-scope value to the other organization. As if it takes no time. As if it has no impact on our eventual performance reviews and salary increments.

The real joke is: They pretend to provide rational incentives, and we pretend to respond to them.

The real truth is: On the lower rungs, we act as human beings and mainly give the help we can. We cooperate across silos better than our managers! And much better than the senior and executive VPs.

1 comment:

daniel noe said...


To this I would also add micro-management. I have always thought of it as akin to socialism and said so to my bosses.

Capitalists just aren't capitalists anymore. Fortunately, this is much less prevalent in some economic sectors than others.