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2013-02-04

My Favorite Articles


These are excerpts and links to some of my favorite articles that I've read online. I know something is my "favorite" when I start repeating it to other people over and over.

I'll update this post with new links when I come across them. Each time I add a new article I'll move this back to the top of my blog.

Current links:



Leadership

Social adeptness isn't a prerequisite... but a basic understanding of how most people think is necessary... every character thinks of him--or herself as a main character.

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To lead people, you have to understand them and what they want, which usually requires recognition of the fact that they don't see themselves as followers innately. They'll follow, if they can lead in other ways.

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Few people see themselves as supporting actors in life itself.

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The visionaries tend to cast themselves as the main players--the saviors, architects, deal-makers and warriors--while most of the others, within that organization, are supporting cast.

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The worst thing about "visionaries"... is that they tend to be easy prey for sycophantic subordinates who often have bad intentions. They see the "golden child" as a docile, eager protege or a lesser version of themselves, when often that person is an exploitative sociopath who knows how to manipulate narcissists. Visionaries tend to see their organizations as benevolent dictatorships with "no politics" (it's never politics to them because they're in charge) while their organizations are often riddled with young-wolf conflicts that they've inadvertently encouraged.

http://michaelochurch.wordpress.com/2013/01/18/leadership-everyone-is-a-main-character/

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Social Classes in the US

I've heavily edited these quotes into bite size sentences. I've never read anything like this before and it strikes as so true I'm practically quoting the entire thing.

I've actually come to the conclusion that there are 3 distinct ladders, with approximately four social classes on each. Additionally, there is an underclass of people not connected to any of the ladders, creating an unlucky 13th social class... The ladders I will assign the names Labor, Gentry, and Elite. My specific percentage estimates of each category are not derived from anything other than estimation based on what I've seen, and my limited understanding of the macroeconomics of income in the United States, so don't take them for more than an approximation.

Underclass... People in the Underclass are generationally poor. Some have never held jobs. Some are third-generation jobless, even. Each of these ladders (Labor, Gentry, Elite) can be seen as an infrastructure based, in part, on social connections. There are some people who are not connected to any of these infrastructures, and they are the underclass.

The Labor Ladder... are assessed based on how hard they work.

Secondary Labor (L4)... earn 1 to 3 times the minimum wage and often have no health benefits.

Primary Labor (L3)... usually means having enough money to afford an occasional vacation and a couple restaurant meals per month.

High-skill Labor (L2) entails having enough income and job security to be legitimately "middle class". People in this range can attend college courses, travel internationally (but not very often) and send their children to good schools.

Labor Leadership (L1) what blue-collar America tends to associate with success... small business owners and landlords, while they're often seen doing the grunt work of their businesses.

The Gentry Ladder... value themselves not based on their incomes but, much more so, on access to respected institutions: elite universities, leading technology companies, museums and artistic endeavors... The Gentry aspires to education and cultural leadership.

Before going further, it's worth noting that the typical socioeconomic ordering would have each Gentry level two levels above the corresponding Labor level in social standing. Thus, G1 > G2 > (G3 ~= L1) > (G4 ~= L2) > L3 > L4.

Transitional Gentry (G4)... the class of people who are coming into the Gentry, usually from L2, and most people in it are looking to attain G3 (and many do). Since the Gentry is defined by education, culture, and cultural influence, earning a four-year degree (which about 20% of American adults have) will usually put a person solidly into G3.

Mobility between G4 and L2 is common, and G4 is a "young people" class, because people who don't keep abreast of politics, current events, and at least the "upper-middle-brow" culture... tend to return to L2 (which is not an inferior class, but an approximately-equal one with different values). Those who keep up tend to progress to G3.

Primary Gentry (G3) is what Americans think of as the cultural "upper-middle class". They have four-year college degrees and typically have professional jobs of middling autonomy and above-average income, but usually not leadership positions. Incomes in this class vary widely (in part, because the Gentry is not defined by income) but generally fall between $30,000 and $200,000 per year. People in this class tend to be viewed as taste-setters by Labor but are viewed as gauche by the higher-ranking G1 and G2 classes.

High Gentry (G2) tend to come from elite colleges and traditionally gravitated toward "junior executive" roles in medium-sized companies, innovative startups, management consultancies, and possibly investment banking... Having interesting, respected work is important to G2's. To a G2, being a college professor, scientist, entrepreneur, or writer are desirable jobs. Creative control of work is important to G2's, although not all are able to get it (because creative jobs are so rare)... Members of this social class aggressively manage their careers to get the most out (in terms of intellectual and financial reward) of their careers, but what they really want is enough success and money to do what they really value, which is to influence culture.

G2 is my native social class, and probably that of most of my readers.

I'm between G3 and G2, so yes, this is me.

Cultural Influencers (G1) are the pinnacle of the Gentry... people who are widely recognized as smart, knowledgeable, creative, and above all, interesting. They tend also to have access to other interesting people. G1's are not "famous" in the celebrity sense, and most of them aren't that rich. I'd guess that their incomes vary mostly from $100,000 to $1 million per year, which is low for a social class that is so difficult to enter (much harder than E4, and possibly E3, to get into).

The Elite Ladder... are exerting themselves toward ownership. Labor provides the work and values effort and loyalty. The Gentry provides culture and it values education and creativity. The Elite owns things and values control and establishment.

As with the Gentry and Labor, when comparing these ladders, one should consider an Elite rung to be two levels above the corresponding Gentry rung, so in terms of social standing, E1 > E2 > (E3 ~= G1) > (E4 ~= G2) > G3 > G4.

The Strivers (E4) are another transitional class that is generally for young people only. They aren't actually Elite, but they might, if lucky, move into E3. Junior investment bankers, law firm associates, and young startup entrepreneurs are in this category. They're trying to "break in" to something rich and successful.

Elite Servants (E3) are the law-firm partners and senior investment bankers and corporate executives that might be called the "working rich" and they comprise what was once called the "white-shoe" culture. They're quite well-off, as far as servants go, often earning incomes from $200,000 to $5 million per year, but their social standing is conditional. They serve the rich, and the rich have to keep finding them useful for them to maintain their place. It's not an enviable place to be, because the social expectations associated with maintaining E3 status require high spending, and even the extremely well-compensated ($1 million per year and up) E3's rarely have the savings to survive more than a year or two without a job, because of the need to maintain connections. E3's tend to have as many money problems as people in the lower social classes. E3's also suffer because they live in a "small world" society driven by reputation, long-standing grudges and often petty contempt. E3's still get fired--a lot, because the pretense that justifies E3-level status (of a large-company "executive") requires leadership and many don't have it--and when it happens to them, they can face years during which they can't find appropriate employment.

People tend to think of face leaders (politicians and CEOs) as belonging to a higher social class, but most are E3. If they were higher, they wouldn't have to work so hard to be rich. Examining our most recent presidents, Barack Obama is G1, the George Bushes were E2, Bill Clinton was E3, and Reagan was in the celebrity category that is a hybrid of E3 and L1. John Kennedy was E2, while Lyndon Johnson was L1. Most CEOs, however, are strictly E3, because CEOs are "rubber gloves" that are used for dirty work and thrown aside if they get too filthy. There's too much reputation risk involved in being a corporate CEO for an E2 to want the job under most circumstances.

National Elite (E2) are what most Americans think of as "upper class" or "old money". They have Roman Numerals in their names, live in the Hamptons (although they've probably stopped using "summer" as a verb now that "the poors" know about it) and their families have attended Ivy League colleges for generations. They're socially very well connected and have the choice not to work, or the choice to work in a wide array of well-compensated and highly-regarded jobs. Rarely do they work full time under traditional employment terms--never as subordinates, sometimes as executives in an apprentice role, often in board positions or "advisory" roles. It's uncommon that an E2 will put a full-time effort into anything, because their objective with work is to associate their names with successful institutions, but not to get too involved.

To maintain E2 status, being wealthy is required. It takes about $500,000 per year, after tax, in income at a minimum. However, it's not hard for a person with E2 status and connections to acquire this, even if the family money is lost. The jobs that E3's regard as the pinnacle of professional achievement (the idea that such a notion as "professional achievement" exists is laughable to them; paid full-time work is dishonorable from an E2 perspective) are their safety careers.

Global Elite (E1, ~60,000 people worldwide, about 30% of those in the U.S.) are a global social class, and extremely powerful in a trans-national way. These are the very rich, powerful, and deeply uncultured barbarians from all over the world who start wars in the Middle East for sport, make asses of themselves in American casinos, rape ski bunnies at Davos, and run the world. Like the Persian army in 300, they come from all over the place; they're the ugliest and most broken of each nation. They're the corporate billionaires and drug kingpins and third-world despots and real estate magnates. They're not into the genteel, reserved "WASP culture" of E2's, the corporate earnestness and "white shoe" professionalism of E3's, or the hypertrophic intellectualism and creativity of G1's and G2's. They are all about control, and on a global scale. To channel Heisenberg, they're in the empire business. They aren't mere management or even "executives". They're owners. They don't care what they own, or what direction the world takes, as long as they're on top. They almost never take official executive positions within large companies, but they make a lot of the decisions behind the scenes.

Unlike the National Elite, who tend toward a cultural conservatism and a desire to preserve certain traits that they consider necessary to national integrity, the Global Elite doesn't give a shit about any particular country. They're fully multinational and view all the world's political nations as entities to be exploited (like everything else). They foster corruption and crime if it serves their interests, and those interests are often ugly. Like Kefka from Final Fantasy VI, their reason for living is to create monuments to nonexistence.

E1 is pretty much objectively evil, without exceptions. There are decent people who are billionaires, so there's no income or wealth level at which 100% objective evil becomes the norm. But if you climb the social ladder, you get to a level at which it's all cancer, all the way up. That's E1. Why is it this way? Because the top end of the world's elite is a social elite, not an economic one, and you don't get deep into an elevated social elite unless you are very simliar to the center of that cluster, and for the past 10,000 years the center of humanity's top-of-the-top cluster has always been deep, featureless evil: people who burn peasants' faces off because it amuses them. Whether you're talking about a real person like Hitler, Stalin, Erik Prince, Osama bin Laden, or Kissinger, or a fictional example like The Joker, Kefka, Walter White, or Randall Flagg; when you get to the top of society, it's always the same guy. Call it The Devil, but what's scary is that it needs (and has) no supernatural powers; it's human, and while one its representatives might get knocked off, another one will step up.

The Gentry tends to be left-libertarian and values creativity, individual autonomy, and free expression. The Elite tends toward center-right authoritarianism and corporate conformity, and it views creativity as dangerous (except when applied to hiding financial risks or justifying illegal wars). The Gentry believes that it is the deserving elite and the face of the future, and that it can use culture to engineer a future in which its values are elite; while the upper tier of the Elite finds the Gentry pretentious, repugnant, self-indulgent, and subversive. The relationship between the Gentry and Elite is incredibly contentious. It's a cosmic, ubiquitous war between the past and the future.

Between the Gentry and Labor, there is an attitude of distrust. The Elite has been running a divide-and-conquer strategy between these two categories for decades. This works because the Elite understands (and can ape) the culture of the Gentry, but has something in common with Labor that sets the categories apart from the Gentry: a conception of work as a theater for masculine dominance.

The Elite also uses the Underclass in a different process: the Elite wants Labor to think the Gentry intends to conspire with the Underclass to dismantle Labor values and elevate these "obviously undeserving" people to, at least, the status of Labor if not promoted above them. They exploit fear in Labor. One might invoke racism and the "Southern strategy" in politics as an example of this, but the racial part is incidental. The Elite don't care whether it's blacks or Latinos or "illigals" or red-haired people or homosexuals (most of whom are not part of the Underclass) that are being used to frighten Labor into opposing and disliking the Gentry; they just know that the device works and that it has pretty much always worked.

The relationship between the Gentry and Elite is one of open rivalry, and that between the Gentry and Labor is one of distrust. What about Labor and the Elite? That one is not symmetric. The Elite exploit and despise Labor as a class comprised mostly of "useful idiots". How does Labor see the Elite? They don't. The Elite has managed to convince Labor that the Gentry (who are open about their cultural elitism, while the Elite hides its social and economic elitism) is the actual "liberal elite" responsible for Labor's misery over the past 30 years. In effect, the Elite has constructed an "infinity pool" where the Elite appears to be a hyper-successful extension of Labor, lumping these two disparate ladders into an "us" and placing the Gentry and Underclass into "them".

Historians are still debating World War I's inception--but the short version is that the world's Elites did that. There was a 30-year period of war, famine, poverty, racial pogroms, and misery that existed largely because a network of high-level obligations and horrendous ideas (especially the racism used to justify colonialism, which benefitted the rich of these societies enormously, but sent the poor to die in unjust wars, contract awful diseases for which they had no immunity, and commit atrocities) set the conditions up. After about a hundred million deaths and thirty years of war, societies finally decided, "No More". They dismantled their Elites vigorously, North American and European nations included. This became the "golden age" of the educated Gentry. In the U.S. (for which the 1950s were a decade of prosperity; in Europe, it was a period of rebuilding and not very prosperous) it was also the "golden age of the middle class".

http://michaelochurch.wordpress.com/2012/09/09/the-3-ladder-system-of-social-class-in-the-u-s/ Back to top



Stock Market is all about expectations (aka gambling)

This is the most insightful thing I've read about the Stock Market, and including where Apple fits with it.

Suppose moreover that the whole league was rife with scandals of coaches "managing the score", for instance, by deliberately losing games ("tanking"), players deliberately sacrificing points in order not to exceed the point spread ("point shaving"), "buying" key players on the opposing team or gaining access to their game plan. If this were the situation in the NFL, then everyone would realize that the "real game" of football had become utterly corrupted by the "expectations game" of gambling.

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The "real market," [Roger] Martin explains, is the world in which factories are built, products are designed and produced, real products and services are bought and sold, revenues are earned, expenses are paid, and real dollars of profit show up on the bottom line. That is the world that executives control--at least to some extent.

The expectations market is the world in which shares in companies are traded between investors--in other words, the stock market. In this market, investors assess the real market activities of a company today and, on the basis of that assessment, form expectations as to how the company is likely to perform in the future. The consensus view of all investors and potential investors as to expectations of future performance shapes the stock price of the company.

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In fact, a CEO has little choice but to pay careful attention to the expectations market, because if the stock price falls markedly, the application of accounting rules (regulation FASB 142) classify it as a "goodwill impairment". Auditors may then force the write-down of real assets based on the company's share price in the expectations market. As a result, executives must concern themselves with managing expectations if they want to avoid write-downs of their capital.

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Ignoring Peter Drucker's foundational insight of 1973 that the only valid purpose of a firm is to create a customer, Jensen and Meckling argued that the singular goal of a company should be to maximize the return to shareholders.

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In the period of shareholder capitalism since 1976, executive compensation has exploded while corporate performance has declined.

"Maximizing shareholder value" turned out to be the disease of which it purported to be the cure. Between 1960 and 1980, CEO compensation per dollar of net income earned for the 365 biggest publicly traded American companies fell by 33 percent. CEOs earned more for their shareholders for steadily less and less relative compensation. By contrast, in the decade from 1980 to 1990 , CEO compensation per dollar of net earnings produced doubled. From 1990 to 2000 it quadrupled.

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"We must shift the focus of companies back to the customer and away from shareholder value... companies should place customers at the center of the firm and focus on delighting them, while earning an acceptable return for shareholders."

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"The expectations market," says Martin, "generates little meaning. It is all about gaining advantage over a trading partner or putting two trading partners together, then tolling them for the service. This structure breeds a kind of amorality in which information is withheld or manipulated and trading partners are treated as vehicles from which to extract money in the short run, at whatever the cost to the relationship."

By contrast, the real market contributes to a sense of authenticity for individuals. Because individuals can find meaning in their jobs. They are not playing a zero-sum game. They are doing something real and positive for society.

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Steve Jobs seemed to delight in signaling to shareholders that they didn't matter much and that they certainly wouldn't interfere with Apple's pursuit of its original customer-focused purpose: 'to make a contribution to the world by making tools for the mind that advance humankind.' Jobs's feisty, almost combative demeanor at shareholder meetings is legendary.

http://www.forbes.com/sites/stevedenning/2011/11/28/maximizing-shareholder-value-the-dumbest-idea-in-the-world/

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Decision Makers Must be Affected by their Decisions

Regulation is all about economics. Here's the theory. In a capitalist system, companies make decisions based on their own self-interest. This isn't a bad thing; it's actually a very good thing. We don't want companies to act as public charities; we want them to act as for-profit entities. But there are often effects of company decisions that are not borne by the companies; these are known as "externalities" to the decision. Companies aren't going to take externalities into account, because, well, because they're someone else's problem. If we as a society want externalities to factor into company decisions, then we have to make those externalities internal. Once we do that, the natural engine of capitalism will take over.

I'll give you an easy example. Company pollutes the river, people downstream die. No one in the company lives downstream, no company customer lives downstream, so the company doesn't care. It's a classic externality. If society wants the company not to pollute the river, it has to remove the externality. Liabilities (allowing the people who live downstream to sue) and regulation (making it illegal to pollute the river) both do that. They raise the cost of polluting the river, so a rational company will spend more money so as to not pollute the river.

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A much better example is the credit card law that limits personal liability for fraud to $50. Before the law, credit card losses were an externality to credit card companies, so they didn't do all that much to improve security. After the law, we got online verification terminals, systems for card activation, data-mining systems to detect fraudulent spending patterns, and so on. Great idea, and one that significantly improved security.

http://www.schneier.com/essay-141.html

The problem with companies protecting your data is that it isn't in their financial best interest to do so. That is, the companies are responsible for protecting your data, but bear none of the costs if your data is compromised. You suffer the harm, but you have no control -- or even knowledge -- of the company's security practices.

http://www.schneier.com/crypto-gram-0504.html#2

In economics, this is known as an externality: the cost of a decision that is borne by people other than those taking the decision.

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If we expect software vendors to reduce features, lengthen development cycles and invest in secure software development processes, it needs to be in their financial best interests to do so. If we expect corporations to spend significant resources on their own network security--especially the security of their customers--it also needs to be in their financial best interests.

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Basically, we have to tweak the risk equation in such a way that the Chief Executive Officer (CEO) of a company cares about actually fixing the problem--and putting pressure on the balance sheet is the best way to do that. Security is risk management; liability fiddles with the risk equation.

http://www.schneier.com/essay-150.html

It's an important security principle: ensure that the person who has the ability to mitigate the risk is responsible for the risk. In this case, the account holders had nothing to do with the security of their account. They could not audit it. They could not improve it. The bank, on the other hand, has the ability to improve security and mitigate the risk, but because they pass the cost on to their customers, they have no incentive to do so.

http://www.schneier.com../blog/archives/2009/09/eliminating_the.html

http://www.schneier.com/essays-economics.html

This is why I don't take Tylenol when I have a headache. Unless I'm affected by my headache, I wont make the changes in my daily life needed to prevent headaches. I'll only take Tylenol when the headache is so bad that it prevents me from doing the things that make the headaches go away.

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Quality Is Hard Work That Takes Time

Without fail, requests I get for new features start with "It should only take you a few hours to ...", or the "Why don't you just do ... this way because it's easier", or "Just make a quick change to ...". What?

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Just don't tell us how easy or quickly we can do it unless you can do it yourself. If you truly believe it's quick and easy to do, do it yourself...

If you want a proper product, understand that crafting takes time and skill, there is a lot more to it that you can even imagine, that crafters are people with feelings too, and that a proper product is a joy forever, is worth both the effort and the wait, and should be something we can all be proud of.

http://www.hiltmon.com../blog/2012/01/11/it-should-only-take-you-a-few-hours-dot-dot-dot

One of the hardest things for me to accept about myself is that I can't do anything in just an hour.

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Learning

If you study, wait, and then study again, the longer the wait, the more you'll have learned after this second study session. Bjork explains it this way: "When we access things from our memory, we do more than reveal it's there. It's not like a playback. What we retrieve becomes more retrievable in the future. Provided the retrieval succeeds, the more difficult and involved the retrieval, the more beneficial it is."

Note that there's a trick implied by "provided the retrieval succeeds." You should space your study sessions so that the information you learned in the first session remains just barely retrievable. Then, the more you have to work to pull it from the soup of your mind, the more this second study session will reinforce your learning. If you study again too soon, it's too easy.

http://m.wired.com/geekdad/2012/01/everything-about-learning/

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Physical Strength

The entire gym, from soup to nuts, has been designed around getting suckers to sign up, and then getting them mildly, vaguely exercised every once in a long while, and then getting them out the door.

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Shaul makes a living by designing strength-and-conditioning programs for Special Forces units heading to Afghanistan. He also owns Mountain Athlete, a private gym in Jackson, Wyoming, where he trains pro ski racers, sponsored ice climbers, full-time international mountain guides, and Jackson locals who keep fit so they can play hard in the Tetons.

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Beneath the Mountain Athlete banners, I saw nothing but dumbbells, barbells, iron weight plates, braided climbing ropes hanging off the ceiling, pull-up bars, and dip bars. No mirrors, no TVs, no music, no elliptical trainers, no weight machines, and, to my annoyance, absolutely no rubber bands or stability balls.

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Muscles weaken with exhaustion after a workout, but then they recover and typically, a few days later, go into what's known as "supercompensation," a fancy word that just means bouncing back a little stronger than before. Soon afterward the muscle fades back to normal again. Work a muscle too soon after the last time you worked it, before the muscle completely recovers, and it'll get even weaker than before. If you work a muscle too late, after that supercompensation effect fades, you'll just keep returning to your baseline.

So the whole trick to athletic training -- and this is true for everybody from bodybuilders to marathoners to noncompetitive athletes just in it for health, or even vanity -- is timing each subsequent workout so it hits the middle of that so-called supercompensation peak, when a muscle has already bounced back even stronger than before but hasn't yet returned to baseline.

http://www.mensjournal.com/everything-you-know-about-fitness-is-a-lie

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Commoditization (computer history)

Demand for a product increases when the price of its complements decreases. In general, a company's strategic interest is going to be to get the price of their complements as low as possible. "

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IBM's goal was to commoditize the add-in market, which is a complement of the PC market, and they did this quite successfully. Within a short time scrillions of companies sprung up offering memory cards, hard drives, graphics cards, printers, etc. Cheap add-ins meant more demand for PCs."

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When IBM licensed the operating system PC-DOS from Microsoft, Microsoft was very careful not to sell an exclusive license. This made it possible for Microsoft to license the same thing to Compaq and the other hundreds of OEMs who had legally cloned the IBM PC using IBM's own documentation. Microsoft's goal was to commoditize the PC market. Very soon the PC itself was basically a commodity, with ever decreasing prices, consistently increasing power, and fierce margins that make it extremely hard to make a profit. The low prices, of course, increase demand. Increased demand for PCs meant increased demand for their complement, MS-DOS."

www.joelonsoftware.com/articles/StrategyLetterV.html

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Copyright 2017 James Reynolds