James Blackwell

The gnuarch mailing list is under fire again. Companies are evil this, venture capitalists are slash and burners that.. the same old story from you know who. When I hear tirades such as these, I can't help but consider the motivations of the writer. Is the person complaining that the system does not work at all, or is the individual is complaining that the system does not work for them?

The prototypical industrialized society is framed around the capitalist system. This system provides for the private ownership, either individually or as groups, to conduct commerce interdependantly with a minimal amount of government controls. An entity can focus on the things that it is good at and trade resources (typically capital, workprodcut, goods or ingenuity) for the things that it is not. This specialization allows for much greater efficiencies than any person could achieve individually.

A player in the capitalist model, whether its an inventor, an investor, a small company or a large corporation, is essentially a living organism that requires certain resources to exist. These players, instead of living off of salads and cheeseburgers, live on capital. Any entity in the capitalist model that runs out of capital will starve and die no less surely than any breathing creature that runs out of food.

This means that the capitalist system is, to some extent, darwinistic. Players, in order to successfully compete against other players, will maximize their value (price vs. worth) by making arrangements with the most effciencient players that they have access to. Failure to do so results in less capital as the competiting players become more efficient than the players that don't.

The price of a product is not limited to the initial cost. Direct factors include, but are not limited to: transportation costs, resale value, maintenance costs. Indirect price factors include the cost of maintaining the relationship with the vendor such as, but again not limited to: Effort contacting the vendor, the integrity of the vendor and the cost of maintaining a positive relationship with the vendor.

A key point that many individuals fail to realize is that individuals are mandatory participants. An individual, just the same of a large multi-regional conglomerate, has a certain amount of resources, whether its capital (venture capitalists), workproduct, ingenuity or other things. These resources can be traded for other resources such as a paycheck, partial company ownership, health care, pensions and so forth. These resources are used to keep the indivitual playing in the game, so that they are able to earn (and potentially reinvest) for more capital.

Just as with any corporation, an individual can price themselves out of the market in any of a variety of ways. One of the many ways that an individual can undercompete is asking for an amount of capital that exceeds thier worth as perceived by others. Another, more subtle, way to undercompete is to make the cost in effort of working with the individual high enough that potential worth is overwhelmed. An individual that is unreliable, inconsistant and works poorly with others may not be able to trade his inherent worth at any price (even free).

Thus, any person or company that finds itself running out of capital must immediately improve the offered value of its goods or services or face failure. Failure to do so can result in metaphorical (literal in the case of the individual) starvation. Thusly, a player must reduce either cost or increase worth. Increasing worth over the immediate term is typically not practical. Reducing cost, however is.

For an individual, one can either reduce the price for doing business or reduce the cost of doing business with the individual. An individual faced with the need to immeidately reduce cost has options available to him or her, including: Improving reliability, improving consistancy, improving honesty, improving relations with others and getting along better with others.

Fighting with others, complaining and other non-constructive acts while under the threat of starvation is a short sighted methodology that will not work.