The Secret of Selfishness

One of the great secrets I’ve discovered is that determining to find something beneficial and refusing to be merely a critic of anything I encounter changes my entire outlook and sets fire to my imagination.

I’m not very good at it.  The critic is easy.  Especially when you can justify it by claiming to be discriminating, skeptical, or prudent.  But really it’s none of these things.  It’s lazy.  Every person, thing, or idea encountered can be mocked, deconstructed, or criticized with little effort, intelligence, insight, and even less benefit afterwards.  The habit of criticize first closes the mind and shrinks the world we inhabit.

There is amazing untapped power if we’re willing to shut down the critic.  This isn’t about being an altruist.  You don’t even need some grand love of mankind to try it.  You need to be more selfish.  You need to want – to demand and resolve – to get something of value from every interaction and encounter.  You have to stubbornly refuse to let the critic blind you to the benefits in everything.  You must commit to penetrate the easy to ignore or deride surface and find something of value to take with you to the next experience.

If you can tap into this secret selfish power, you will see things no one else sees, enjoy things others ignore, and build social and material wealth where others burn them.

Published
Categorized as Commentary

The Success of Your Friends is Your Success

Envy is evil.

Not just for its corrosive effects on society, but for what it can do to undermine your own success.  Envy makes you bitter and joyless.  Worse, it blinds you to your own potential and the opportunity around you.

If the success of those around you makes you less happy, you’re in a death spiral.  Conversely, one of the great secrets to personal growth and achievement is the realization that the success of your friends is your success.  Not metaphorically, and not just ’cause it gives you feels.  In a very literal sense.

You can think of it as a formula:

YC = YS*FS

Your ceiling equals your success times your friends success.  Let me give a simple example to illustrate.  If you succeed at coming up with a  brilliant idea for a business (YS goes up with the idea) and you have friends who have succeeded financially (FS is high), they can invest in your idea or connect you to those who can, which multiplies the total yield from your effort.

Given the above formula, there are several ways to raise your ceiling.  One is to increase your success directly (grow YS).  Another is to increase the number of people you consider friends (grow F).  Another is to increase the amount of success your friends have (grow S).

The more people with whom you are friendly, and the more you embrace and support their success, the more you multiply your own efforts and raise your personal achievement ceiling.  Each year that passes, if you keep investing in FS, it will compound.  I have friends whose success has led to them meeting people who were really valuable to the success of other friends, so I connected them, increasing everyone’s success, and later those successful friends were able to connect me to people who could help with what I’m doing, etc.

It’s sort of like Metcalfe’s Law for your personal network, except better.  I doesn’t just grow in value with each new node, but each node grows in value as each other node grows in value as well.

Be generous with who you consider a friend, and take joy in all their successes!  It will catapult your efforts. (But remember, no matter how high FS, if YS is zero, your ceiling will still be zero).

Published
Categorized as Commentary

139 – Bryan Caplan Interview Follow Up

After interviewing Bryan Caplan about his book, The Case Against Education, I had so many thoughts rolling around my head that I decided to record a separate follow up episode.

In this episode, I cover where I think Bryan is right, where I think he is wrong, and where I don’t think he goes far enough.

If you haven’t listened to the full interview with Bryan yet, check it out first.

Topics Covered:

  • How economic thinking and rational choice theory explain the choice to go to college.
  • The role of parents in their kid’s choices to go to college.
  • Do you need to be a super genius to succeed without college?
  • People choose college out of fear for bucking the dominant belief system.
  • Getting cheap easy praise from college and how that creates entitlement.
  • College grads are free to blame the economy when they are unemployed.
  • College degrees as a social signal, not an economic signal.

Links: 

All episodes of the Isaac Morehouse Podcast are available on SoundCloudYouTubeiTunes, Google Play, and Stitcher

Published
Categorized as Podcast

Friends are Individuals, Enemies are Collective

I had the misfortune of sitting in a hotel lobby that had TV news playing today.  At some point, the anchor said something about, “The Russians”.  It struck me how odd, and subtly dangerous this language is.

Foreigners, far-away peoples, threats, enemies, or those we fear get labelled as a giant unified collective.  In reality, only individual humans act.  “The Russians” cannot do or say anything, only individuals can.  But it’s too complicated and nuanced when you’re telling yourself a simple us/them, good/evil story.

Think of the groupings that get labelled in this way.  “The Chinese” is another big, monolithic bogeyman.  But if the Prime Minister of Britain says something, headlines don’t talk about “The British”.  If a Canadian politician speaks, no one says, “The Canadians want NAFTA”.  And, of course, no one who lives here would dream of giving every individual human in the United States a single identity.  Can you imagine trying to answer, “What do the Americans want?” about any topic?

I get it.  It’s a shortcut to prevent mental overload.  Far-away stuff we know little about is much easier to lump together as “the chaos/threat out there”, like the old maps with, “Thar be dragons” on the unknown places.  Still, it’s wise to catch yourself when using sweeping collectivist labels for diverse groups of individuals and ideas.

Published
Categorized as Commentary

Some Childhood Mischief Retold

I had a buddy named Andrew, and we were ridiculously mischievous whenever we were together.

When I was about 12, we were hanging at his house during his older brother’s high school graduation open house.  We decided it would be a great idea to make it look like the house was on fire in the middle of the outdoor party, just to mix things up.

It was a single level house, save for a small FROG-style (but not above a garage) upstairs room + bathroom with low, slanted ceilings and ’70’s era faux wood particle paneling.  That’s where Andrew’s graduating brother stayed, and where Andrew was soon to take over when his brother vacated.

We slipped away from the buffet of Midwestern casseroles and sticky, fly-frequented fruit plates into the house.  Andrew had a stash.  He always had a stash.  Not drugs or booze or naughty magazines or things most parents worry about with boys.  His stashes were always a mix of flammable and explosive stuff, pilfered here and there from his brothers, other buddies, or smuggled across state lines in annual pre-July 4 stock-ups. Somehow, Andrew always had more and better stuff than anyone I knew.

We made all manner of ingeniously stupid devices, from black-powder filled aspirin bottles with a too-short wick, to a mini wrestling ring made from a small square of half-inch thick wood with a nail in each corner and copper wiring wrapped around like ropes, connected to a power cord ripped from an old lamp.  We blew half the breakers in the house, threw sparks, and instantly liquefied the poor plastic soldier we’d twisted into the copper ring ropes when we plugged it in.

Sorry, I got distracted.  Back to the stash. Today, we opted for something far less exotic, with more theater than real danger.  A little round smoke bomb.  After some deliberation, we opted against the brighter colors and picked one that released a thick plume of plain white smoke.  The soon-to-be-his upstairs lair was locked.  We needed to stage the prank up there to have maximum effect with minimum damage and parental fallout.  Back outside we went.

Lucky for us, it was warm that day, at least by Michigan standards.  This meant the un-conditioned air in the house was hot, so windows were open.  The upstairs room was a long single corridor with a bed and window at one end, and a bathroom with a window at the other.  The bathroom window faced the front of the house, and the party was out back.  Its screen insert was loose and prone to falling out.  A few tosses of small objects knocked it back onto the bathroom floor.  We ducked into the shrubs a few times when cars went by.  Finally, the coast was clear and the screenless window open.  We could see the shower curtain pulled back, offering a perfect landing spot.  I lit the fuse and Andrew hurled the little yellow orb over the windowsill and into the bathtub.

We grabbed a backpack with a few items and snacks and ran into the woods laughing all the way.  When we were safe, we turned back and edged toward the treeline by the yard just in time to see a massive plume of smoke billow out the upstairs bathroom window on the front of the house, then a smaller plume out the back window facing the yard where everyone mingled.  Andrew’s younger sister was the first to notice.  She yelled, “Dad, is that smoke?!”  Several people looked up, someone ran around front to see the thicker smoke there, then a few people started screaming, “Oh my God, the house is on fire!”

It got pretty chaotic for a few moments, even though most of the guests did nothing.  Andrew’s dad sprung into action immediately, running through the garage, grabbing an extinguisher, and bounding through the house up the stairs.  You could hear him from outside like in a cartoon.  By the time he reached it, the smoke bomb was spent, and the cloud was slowly dissipating (it took a surprisingly long time for the upstairs to clear completely, and the smell never really did).

His dad screamed out like Dave from Alvin & the Chipmunks, “Aaaaaandreeeeeeew!!!”

We dashed deeper into the woods to let things cool down a bit, and spent the next several hours laughing and retelling all we’d witnessed, especially his brother’s look of knowing rage as soon as he saw smoke spoil his party.

When we wandered back to the party-strewn lawn just before dark and into the house, Andrew got the standard high-octane lectures from mom, dad, and siblings.  Besides the panicked exit of a few people who had been in the house, no real harm was done.  Well, except for Andrew.  His older brother gave him a flurry of hard wallops in the shoulder that had to hurt, but Andrew just gave in and crumpled to the floor laughing maniacally and victoriously even as he took his lumps.  I just stood there watching trying not to laugh too loud.

That was one of our mildest exploits.

Disclaimer: This is how I remember the event, but my memory is 100% narrative focused, so details and facts may be incorrect, or the whole thing could have been a lot less exciting that I remember.

Published
Categorized as Commentary

When Academics Describe the World

I always gets a kick out of academics confidently describing the world based on their models and research, especially when the world right outside their window works nothing like what they are sure must be happening based on their theorizing.

I’m all for theorizing.  Big ideas require reflection.  But the best theorizing happens in a loop, taking in the real world, reflecting on it, putting the resulting theories to test back in the real world, reflecting again, etc.

In economics, theorists will tell you “public goods” like lighthouses can’t ever be supplied by private, profit-seeking ventures.  Meanwhile, right outside their window there are private lighthouses, provided in ways too varied and ingenious for the academic mind to comprehend, and too skin-in-the-game trial-and-error intuitive for the entrepreneur to even know how to explicitly describe.

So you have the self-interested tinkerers doing the impossible without being able to describe it, and the sheltered academic calling things impossible without being able to try them.  The Royal Society confidently declared that years of peer reviewed research proved what a couple of bike mechanics did at Kitty Hawk was not possible.  They didn’t publish any papers, they just flew the damn plane and changed the world beyond the small dreams of academics.

A far less dramatic example I recently encountered gave me a laugh too.  A professor told me that the best way for candidates to stand out on the job market, given the ubiquity of college degrees, is by their GPA.  It seemed to him a sensible and efficient way of beefing up the flabby and dying signal of a degree.  In the real world of hiring, no one cares about GPA.  No one wants to see it on a resume.  In fact, listing it has a greater chance of being a negative signal than positive.

I’ve also been following a debate in the bitcoin community about an academic paper on the probability of profit from “selfish mining”, basically a way to cheat the bitcoin system and, for all intents and purposes, ruin it.  I don’t pretend to know the higher math involved, nor do I claim to know the actual probability of this threat.  Still, I find it amusing the amount of confidence about what is mathematically possible that ignores what real rational actors in the market actually do.

It has a similar flavor to those old silly Hobbesian claims (often portrayed in unimaginative Hollywood films) that, absent Leviathan, everyone would immediately kill each other, or that all power disparities will result in total annihilation of the weaker.  Those who see the world this way claim to be taking account of man’s high level of self-interest, but in reality they don’t see the world at all, and are completely underestimating just how self-interested humans really are.

It seems the lack of academic imagination stems from lack of seeing the world around them, the way Watson failed to see what Sherlock did.  Those who can see are rarely the ones able to describe what they see or write books about it.  Instead, they act on it with innovation and value creation.  In a free market anyway, profit goes to the visionaries, even if they’re unable to describe what it is they see.  Then everyone else spends decades debating the proper description of the world created by the innovators.

Let them debate.  Go create.

Recommended reading:

The Obviousness of Anarchy

Published
Categorized as Commentary

The Beauty of Starting from Scratch

I have a lot of ideas.  I write a lot of them down.  Sometimes in great detail, mapping out how things would look under such and such conditions, what this or that change would do, the best way to handle rapid growth in this direction, etc.

A few action items get culled from the ideas, then I move on.

Months, or sometimes years later, I’ll be working through the same or similar ideas again.  But I don’t go back to my old notes.  Not at first anyway.  I start from scratch.  Why?

I want to get the new, raw ideas, untainted by my past self.  I also want the best of my previous ideas to make it into my current work, not all of it.  I figure the best of those ideas seep into my subconscious and become a new part of my paradigm, so I don’t need detailed notes to draw them out.

I hammer out all the ideas from scratch.  Then I might go back and look at my previous deep dive.  It’s pretty cool to see how much of it is almost verbatim, even though I don’t consciously remember it, and also to see which parts got left behind.  Nine times out of ten, the things forgotten were worth forgetting.

I try not to cling to my past ideas tightly.  If I work through them fully, get them out, and treat them with respect in the present, the parts that matter most tend to get embedded and carry forward silently until needed in the future.

Published
Categorized as Commentary

138 – Bryan Caplan on The Case Against Education

Bryan Caplan’s new book The Case Against Education, argues against the common arguments the value of school and college. Most people would consider his view pretty radical. He recommends massive cuts to education spending and that many people should not go to college. In this episode of the podcast, I argue that he doesn’t go far enough.

Topics Discussed:

  • How Bryan got started thinking and writing about education
  • Degrees as a signal
  • Credential inflation
  • Arguments about the quality of education
  • Parents the motivation for college
  • Do employers really want conformity?
  • Working for free as a signal
  • Even though it’s just a signal, should you still go to college?
  • Bryan’s upcoming graphic novel on immigration

Links:

For more background on where we disagree, check out:

All episodes of the Isaac Morehouse Podcast are available on SoundCloud, YouTube, iTunes, Google Play, and Stitcher

Published
Categorized as Podcast

Taking the “Digital” out of “Digital Gold”

There’s an idea that bitcoin should be a “store of value”, like digital gold, instead of something used directly for every day transactions.

But this misses the entire point of digital gold.

Gold has been the most pervasive form of money on the planet for thousands of years because it has the best properties of any substance to act as money.  The one property gold does not have is portability.

That missing property is the source of many monetary woes in history. It makes gold easy to seize by governments. It requires claims to gold to be used in every day transactions, instead of gold itself, which opens an entirely new opportunity for fraud, fiat, and inflation.

The idea of digital gold is to take all the amazing attributes of gold and add the one thing it’s missing: portability. That’s what the “digital” part means. The magic of bitcoin is that it found a way to maintain all the very best properties of money found in gold and add to them the greatest portability of any money in existence with instant, near free global transactions.  Until bitcoin, there was always a choice between the other key attributes of money and portability. Digital scarcity was thought impossible. Bitcoin emerged as a new kind of money that puts the properties the oldest and best form into bits and bytes for maximum portability.

If the plan is to hamper the portability with low block limits, long waits, high and radically changing fees, then it’s not digital gold at all. The whole point of making gold digital is to take advantage of the portability of digital. Without that, it’s just like regular gold. But we already have regular gold.

If it requires second layer solutions and claims to the underlying asset, it’s no improvement over gold standards with paper money, which may be better than what we have today but vulnerabilities in that system also got us to today.

If you kill portability, you don’t have digital gold. You have a gold competitor that brings no new attributes to the table, save perhaps the known limit of supply.

To make use of the “digital” in digital gold is to ensure that one great property that physical gold lacks, portability. An instantly portable gold functions as cash. But better. It functions as the best properties of cash but with all the key properties of gold at once.

So a bitcoin unusable for daily transactions should certainly not be called electronic cash. But I think even digital gold is too generous, since there’s no point to digitization if you don’t take advantage of it.  It’s more like gold without history.

I prefer the vision in Satoshi’s paper. All the best properties of gold with instant portability is a game changing advance in human society.

Published
Categorized as Commentary

The Best Reason to Drink Coffee

My coworker Chuck told me he drinks two cups of coffee a day.  I asked how he came to that decision.  He said he chose to because he likes the way it makes him feel.

I can’t think of a better reason.

Usually, people give long-winded justifications of caffeination; “Studies show the brain is better on coffee”, “Nassim Taleb says it’s a good idea”, etc.

Chuck’s response is so much better.

Not just superficially.  It’s clued in on the most important insight for personal well-being.  The word personal.  We are far more radically biologically diverse than we assume.  The idea of “a proper diet” for a generic human being being the best for any specific individual person is absurd.  (Read Roger Williams if you don’t believe me).  Chuck doesn’t care about averages and aggregates.  He doesn’t care about human life with coffee in general, but his life with coffee in particular.

I can’t think of a better approach.

It’s harder than you think.  It’s not just mindless hedonism.  It takes rigorous self-knowledge and self-honesty and willingness to go with what you find instead of cow-tow to the whims of the crowd for prestige.

Published
Categorized as Commentary

When You Do Everything Backwards

I was talking to my wife over the weekend about the stage in life we’re in.  We have four kids, ages 11 months to 13 years, and now, for the first time, we finally feel like this parenting thing is super fun and rewarding!

Not that we haven’t loved it all the way, but it’s been marked more by difficulty and chaos than calm delight.  We got married very young.  I was (almost) 20 and Heather was 22.  Our first kid was a surprise just a year later.  We moved several times, were always very tight financially, had the pain of a miscarriage then infertility for five long years, a crazy whirlwind adoption process followed by a surprise pregnancy nine months later (adoption is often a cure for infertility!), an escape from a city we hated living into a brand new place with no connections, quitting a great job to launch a company, tragic deaths in the family, an ill-fated trip abroad, yet another surprise pregnancy (we don’t plan well), a move to a house we hated, then a move to a house we loved.

Now we’re here.  We’ve got a rhythm to this parenting and home/unschooling thing.  We’ve got a rhythm to the growing company, kids activities, social life, etc.  There’s a peace a joy in place we’ve never really had, and never really realized we didn’t have until we did.

It dawned on me that being settled in a great house in a great city with a great company and lots of knowledge on how we want to parent and a good financial situation and clear life and career goals is a state of being most people try to achieve first, before they have kids.  We do everything backwards.  We always end up jumping in with both feet, getting the worst of it, fighting for air, then realizing in retrospect that we had no idea what we were doing.

I’m not sure I’d advise our approach to anyone else.  But I also don’t think I’d do it differently.  If we knew more, we might not have done any of the big crazy stuff that helped us grow.

Anyway, here’s to the next leap and whatever it brings!

Published
Categorized as Commentary