Tag: creative destruction

Creation Guides the World All the Way Down

By Craig Axford | United States

According to Buddhist teachings, life is Dukkha, which is commonly translated as suffering or being unsatisfactory. The source of this underlying dissatisfaction is our attachment to particular things, concepts, or even our own identity (self). Find a way to let go of the attachments and the suffering will disappear as well.

Creation is often paired with the act of destruction. The economist Joseph Schumpeter described destruction as an essential component of capitalism’s creative process. In Capitalism, Socialism, and Democracy he wrote, “Displacement of existing managements is an important, perhaps the most important, part of the show.” Indeed it is.

But it is more accurate to describe creation as transformational rather than the destruction of the preexisting order. Destruction, in truth, is an illusion that arises from our attachment to the status quo, and that attachment, the Buddha would point out, is the source of much personal and social woe.

Seeing life as a series of losses — one destruction after another — requires us to narrow our focus to the object, person, or concept in question. In other words, seeing the world as fundamentally destructive rather than creative and transformative necessitates a refusal to see things in context.

If we imagine a tree falling in a forest, we can see the tree’s plunge to the earth as its death or destruction only if we concentrate our attention on the tree alone. However, if we see the tree in context we realize its fall created an opening in the forest, a new habitat for creatures, fungi, and bacteria that will make the dead wood their home and consume it over time. Ultimately these will transform the wood to mulch that will foster renewal and new growth. In other words, the death of a tree is merely transformative. It is only destructive if one had an attachment to the tree itself without any regard for the system it belongs to.

This type of contextual thinking not only allows us to see the world as transformational but empowers us to become better participants in the process of creation itself. “Creativity does not happen when we withdraw from the material world,” says the travel writer Eric Weiner in The Geography of Genius, “but, rather, when we engage with that world, and all its messiness, more authentically and more deeply than we are accustomed.”

Openness and engagement nourish the creative process by liberating us from the clinging the Buddha warned against, and from judgments which ultimately skew our perspective. “For creative people,” Weiner continues, “it matters not whether their surroundings are good or bad. They derive inspiration from both, taste the salt in all things. Everything is a potential spark.”

Ideology and attachment are blinders that narrow our vision. Through them, we become one-dimensional thinkers who too often default to what seems intuitively true from our limited viewpoint. By seeing things in their larger context rather than individually we begin to approach others, objects, and ideas obliquely.

Obliquity is the opposite of the direct linear approaches that we often take in the interest of speed and efficiency. It is the recognition that inspiration doesn’t just come from one direction. It can come from anywhere, including sources that have no obvious connection to the problem we are considering. There is a greater tolerance for error when we see things obliquely because experimentation is part of the process. The economist John Kay put it this way:

In general, oblique approaches recognise that complex objectives tend to be imprecisely defined and contain many elements that are not necessarily or obviously compatible with one another, and that we learn about the nature of the objectives and the means of achieving them during a process of experiment and discovery. Oblique approaches often step backward to move forward.

Destruction is an illusion not because things don’t really change, or even disappear entirely from our lives. It’s an illusion because we believed them to be immutable in the first place. We refused to see change rather than permanence as the process that underlies everything, including ourselves. It’s just a continual process of creation all the way down, a creation generally missed by the human eye.

The Buddhist teacher Thich Nhat Hahn said, “It is not impermanence that makes us suffer. What makes us suffer is wanting things to be permanent, when they are not.” From this perspective, even death is just another turning of the wheel. Sooner or later every tree in the forest falls, creating a new opening for fresh light to shine in.

 

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The Death of Cinema

By Mason Mohon | USA

I would absolutely love to write a movie review of the latest installment of the Star Wars franchise: The Last Jedi, but that is out of the question. I saw the movie last night, or at least I tried, but all the lightsabers, stormtroopers, and edgy young Sith lords with emotional issues are beginning to blur together in my head, so I checked out of reality and used the experience as a bizarre naptime. So I can’t tell anyone whether the movie was good or bad because I was very tired. So is the rest of America. Society is getting tired of shoveling out an entire month’s worth of Netflix subscription to watch an ok movie in a dirty theater.

The movie theater industry is in trouble, but its ok, because we can chalk this all up to creative destruction.

The film industry has been punching and screaming for years. It tries its hardest to stay afloat, releasing bigger and better movie screens as they go along. Every year, we see a bigger and better IMAX 3D screen come out at another theater. They build themselves up more and more, but the problem is this may be to no avail. The market is evolving, as it does.

The weeks leading up to Star Wars chilled me when I compared them to the leading weeks in previous years. The long anticipated trilogy reboot that came with exciting trailers and lots of hype. Episode 7 was the long lost child of the space legend everybody had been looking for. The movie unsurprisingly broke box office records, and the following year wasn’t too different. Rogue One was an exciting new take on the Star Wars series. It told a story with mostly new characters and showed a different side of the universe, topping it off with an “everyone dies” storyline I thought I would only get from Cloverfield movies.

This year, I heard nearly no mention of them. I saw the trailer when it came out and bought tickets with my friends in advance, but then I forgot about it, and it seemed that everyone else did too. It would rarely come up in  conversation, and I never heard “I can’t wait for the new Star Wars.” The movie did well, though, but not quite well enough to save a fading away industry.

The Motion Picture Association of America reported that the average American will have bought 3.6 movie tickets this year, which is down 30% from 2002’s rate of 5.1 tickets. People are not seeing as many movies anymore, and why would they. Stranger Things 2, a plethora of new Marvel superhero series’, and the constant flow of originals make Netflix a satisfying alternative. Streaming services are in, and you can get a month’s access to them for the price of a single movie at a theater. This is the free market serving consumer preferences at work.

Cinema showings aren’t dying this year, but the numbers are dwindling and I do not expect them to be a major part of American society for much longer. This teaches us the valuable lesson of creative destruction, as mentioned earlier. The market must serve consumer demand, and what the consumers demand is changing. With the rise of the internet and the opportunity it gave to entrepreneurs and innovators, we should have seen this coming. The free market is a glorious thing, though, so we can rest easy knowing that if you and others enjoy something, it is likely the market will keep it around.

The way things seem to always turn around is less bad movies and more good markets.

Foresight? Who needs it?

By Mason Mohon | USA

We’ve all heard in our times of distress “the world will keep on spinning without you.” This statement is probably true and normally puts one at ease, making one realize they don’t have to conquer reality in this instance. But while it may be true for individuals, there is a larger, broader group of people this idea may not apply to. Those are the entrepreneurs.

There are many ways to view the entrepreneur and many subjects that touch on the idea of the entrepreneur. Business, self-help, finance, and economics all, at one point or another, take a look at this idea. But what is it? What is an entrepreneur, and what do they do?

In my opinion, the greatest definition of an entrepreneur is someone who sees problems not as such, but rather, as opportunities. This nails a very basic meaning of what an entrepreneur does, but how do they do it? The Misesian view of entrepreneurship is someone who acts with foresight. Because they are acting under uncertainty, a good entrepreneur must have very keen foresight.

But why does this foresight keep the world spinning? The “problems” that entrepreneurs see are seen by them as demand, a way to make a profit. I covered this in my previous article on the entrepreneurs titled The Market is Brutal, and That’s a Good Thing which can be found here, but to cover it briefly again, the entrepreneur benefits everyone. Nothing they do is useless, it is always to benefit another person, while also benefiting themselves. If an entrepreneur were to engage in action that helped nobody else and paid no attention to demand, the result would be the entrepreneur falling flat on their face. This is the glorious brutality of the market.

These people may not literally spin the earth, but they sure do help us develop our lives and aid in the division of labor. A successful economy not only needs entrepreneurs but needs them to both be able to be successful and be able to fail. To give them the ability to be successful, they must have foresight, which brings us to the idea of time preference. In the first chapter of Democracy – The God that Failed, Hans Hoppe articulates this idea of time preference by explaining it as when individuals prefer goods. High time preference means that one prefers a good sooner rather than later, and low time preference is the opposite.

This phenomenon more or less explains why capitalism civilizes society. One with low time preference will begin to use his current wealth as future wealth, whether it is through saving or investing makes no difference. This is because the individual expects to gain more in the future and can afford to have less now. If these expectations prove correct, they time preference rate will further lower because this actor will begin to participate in the same type of action more and more, because it is so profitable.

The result of this is civilization increases, meaning that we develop new medicines, nutritions, health care, and increased life expectancy. The impacts of lower time preference are a net benefit. Entrepreneurs in the Misesian view have a very low time preference, being able to take a serious hit in the short run for a potential goal in the long run. They look forward to the future and this also benefits everyone.

So a successful economy needs entrepreneurs to be able to both succeed and fail, but there is a burden that entrepreneurs face which decreases their foresight. This burden is taxation. Taxation is when the state coercively takes money from individuals, which causes a rise in time preference because they have fewer present good, AND fewer future goods because the state will continue to tax. The result is less foresight and less willingness to invest in the future because one knows they now have less wealth along with less future wealth. Taxation causes people to be more present-oriented because it takes from the goods of the future, not just the present.

Imagine if the state were to tax less – a lot less – so entrepreneurs, investors, and all other individuals can all be more future-oriented. Imagine the effect this would have on human health and technological development. This is why the state should curb its levels of taxation as much as it can because every tax hinders the process of civilization.