The other day I had a daydream. I daydreamt that I was in a Dunkin Donuts. Have you ever daydreamt about being in Dunkin Donuts? Surely I can't be the only one? Here's my excuse...
This is your brain on unread emails: does the information age stop us thinking straight? I was tweated to that article... but it didn't fully catch my attention. So while I'm reading it I'm also thinking about clarifying demand.
Clarifying demand is a central theme of this blog. Why is it important to clearly see the demand? Because...
Right now we can clearly see some of the demand. But what we can clearly see is a drop in the bucket. It's like capturing a minnow instead of a whale.
The single largest portion of this whale can be found in the public sector. What is the demand for war? We don't know. We don't know the demand for war. People have never been able to allocate... or not allocate... their taxes to war. Therefore, we've never known the demand for war. But we know the demand for Dunkin Donuts!
Donuts! Does knowing the demand for donuts really matter? Yes? Could the government reasonably divine this demand? Yes as well!? Does anybody really believe this? We should vote on whether the government should be in charge of supplying donuts like it's in charge of supplying war. Would anybody vote no? Why? They trust their government with supplying the right amount of war... but not with supplying the right amount of donuts? That would be... strange.
"Oh noes... the government is supplying too many donuts with sprinkles!"
"How's it doing with the supply of nukes?"
"Who cares man!? The donuts are what's important! What are we going to do with a surplus of donuts with sprinkles?!"
"Maybe it was a mistake to put the government in charge of donuts?"
What if everybody happens to be consistent with their trust and confidence and faith... oh so much faith.... in the wisdom of congress? Then at worst, the government would be in charge of supplying donuts. Will the government fuck this up? Will they be able to know, better than you do, which donut you want, and when you want it? Or maybe they'll know better than you? How could you ever doubt their answer?
I hope this blog sets off a big donut debate. THE Big Donut Debate. Whether congress can spend taxes on donuts as effectively as they spend taxes on war. This debate will be in history books until the end of time. About how a ultra primitive society debated the idea of whether congress should also spend their taxes on donuts... and it was one of the most important debates ever. Because, the debate opened their eyes. And when that happened... that's when real progress began. Discovering the importance of clarifying demand was infinitely more important than the discovery of fire, the wheel, language or any other major discovery.
Speaking of major discoveries... the other day I wondered who discovered that it was a good idea to ride a horse. Who gets credit for this idea? Some guy does. It's hard to see it happening as an accident? Blorg was climbing a tree... and happened to fall on a horse... and managed to ride it? Or, Blorg was hunting a horse... he jumped on its back to kill it... but a lightbulb went on? If not an accident, then maybe a dare? Like, I dare you to tip that cow. But... I dare you to ride that horse. When were dares invented?
Perhaps animals were used as pack animals before somebody had the bright idea to ride them? Do we know this answer? I'm going to google it...
Ok, for sure horses were first used for meat. Seeing an animal and thinking "Eat and live? Or run away and live?"... seems pretty basic. Seeing an animal and thinking, "maybe there's an opportunity cost to eating this animal?"... seems more complex. Horses have more than one use. Discovering the eating part was the easiest. But what about the other uses? Which came next... carrying things or people?
According to Wikipedia... Domestication of the horse...
The horses of the Ice Age were hunted for meat in Europe and across the Eurasian steppes and in North America by early modern humans. Numerous kill sites exist and many cave paintings in Europe indicate what they looked like. Many of these Ice Age subspecies died out during the rapid climate changes associated with the end of the last Ice Age or were hunted out by humans, particularly in North America, where the horse became completely extinct.
Wow, did you know that last part? I sure didn't.
It certainly wasn't obvious that eating horses has an opportunity cost. For most early humans it was a rule that horses are for eating. And then somebody broke that rule. The only people who break rules are criminals.
But this criminal sure wasn't in North America. As a result, humans in North America hunted horses to extinction. None of them ever saw the truth that horses have alternative uses. Their failure to see this truth stalled their progress. Thank goodness we didn't have all our horses in the same basket. Disparities in progress are the result of disparities in truth. Less truth less progress. More truth more progress. Truth and progress depends on difference. It took considerable difference for somebody to break the rule that horses are always for eating. It's not just being or thinking different. Difference is nothing without the freedom to act differently. Economics is the study of action.
But what was this alternative action? Was it carrying things... or people... same thing? Kinda, but not really. The Wikipedia article doesn't know which came first.
This part's pretty good though...
All of the dated chariot graves contained wheel impressions, horse bones, weapons (arrow and javelin points, axes, daggers, or stone mace-heads), human skeletal remains, and cheekpieces. Because they were buried in teams of two with chariots and studded cheekpieces, the evidence is extremely persuasive that these steppe horses of 2100–1700 BCE were domesticated. Shortly after the period of these burials, the expansion of the domestic horse throughout Europe was little short of explosive. In the space of possibly 500 years, there is evidence of horse-drawn chariots in Greece, Egypt, and Mesopotamia. By another 500 years, the horse-drawn chariot had spread to China.
Can you imagine this idea/truth spreading? "That guy is not eating a horse. Wait...what? Why isn't he eating the horse? Or really? Wow, I guess that does make sense. A lot of sense."
One use turned out to be feeding horses to lions. For entertainment. When did humans begin to be entertained by other animals? Are monkeys entertained by other animals?
Was man entertained by watching a lion attack a horse in the wild? So entertained that he wanted to recreate the event? The other day I did enjoy watching the documentary about how a great white shark was killed by a killer whale. Except, it really wasn't much of a fight. Some killer whale figured out that flipping a shark on its back made eating it a whole lot easier.
Humans eventually figured out that horses could be used for war. Unfortunately, humans still haven't figured out the value of knowing the demand for war.
While the public sector is the largest single space where demand needs to be clarified... there are endless other smaller spaces where demand also needs to be clarified. Like... Netflix. We pay for a big bundle of content... so the demand for the individual components is unknown.
If you can effectively imagine all the places where demand is obscure... then you should appreciate the disparity between seen and unseen demand. The disparity is massive.
All this, and a lot more, was a mental process that was running, more or less, while I was reading the article about thinking straight. The article was written by Sophie McBain. When I saw her picture I was hit with the impression that women writers are unusually attractive. Eh. Where did that come from? That can't be right. I'm sure it's not true that the average photo of some female writer will contain a face prettier than most. And I'm even more sure it's not true that in reality female writers are prettier than females in other professions.
McBain's story contains this paragraph...
Crawford is taken aback by an advertisement that flashes up on a card holder just before he enters his credit-card pin, and the one stuck to the back of his fold-out tray on an aeroplane. In South Korea, bus passengers can be squirted with the smell of Dunkin’ Donuts just as they reach the shop. “In a culture saturated with technology for appropriating our attention, our interior mental lives are laid bare as a resource to be harvested by others,” he writes. To make things worse, modern technology seems to generate in us an ever-greater need for stimulation. We are addicted to our buzzing mobiles, our rapidly filling in-boxes and 24-hour news. For all that we’ve gained, it can feel like we have lost something, too. “We don’t feel our attention is ours, and we complain about it,” Crawford writes.
This paragraph is how I ended up at Dunkin Donuts in a daydream.
I'm standing in a Dunkin Donuts. And I have my phone with me of course. I go to a website... and search for Dunkin Donuts. Because, like everybody else, I'm curious to see the rest of the demand. There's a list of "wishes" that customers have spent their money on. I see that one of the wishes is that the employees would smile more. I look up and... the employees are smiling. It makes me smile. That's worth a few cents... so I allocate my money to this wish. Another valuable wish is the music. There's quite a bit of demand for better music. I listen and realize that the music is worth shazamming... which is worth a few cents... so I allocate my money accordingly. Nearly as valuable as the music is the style of the space. I look around... and the style is nice. Real nice. Definitely worth supporting. Also on the list is that the space should be open. Right above it in value... the wish that the space should be more intimate. I look around again... the space is somehow both open and intimate. And the chairs look comfortable... which was also on the list.
Super high on the list was... healthy and tasty donuts. Is that even possible? Yes? Yes. Even higher on the list was "something new!". Everything has diminishing returns. Variety is the spice of life.
The highest (most valuable) wish on the list was... of course... more epiphytes. Epiphytes have the least diminishing returns. Inside the Dunkin Donuts there were epiphytes growing on most surfaces...hence the nice style... and each order of donuts came with a neat little epiphyte. They were all different... it was impossible to collect them all. People, being all different, would frequently trade their epiphytes.
The epiphyte that I received was a super cool succulent orchid with a bright red bloom. It was attached to a branch which I hung from a stand on my table. As soon as I did so, a brilliant hummingbird flew up and enjoyed some nectar from my orchid's flower. I saw the flower's pollen stick to the bird's beak... and it flew over to another table where it pollinated another orchid in bloom. A space for humans and hummingbirds to eat... was also a space for flowers to procreate.
What I might need to point out is that the money allocated to these wishes goes to the people responsible for submitting them. It was valuable to submit the most valuable wishes. And the only way to truly figure out the value of a wish was to submit it.
David Glasner said this...
It is the growth and diffusion of knowledge (both practical and theoretical, but especially the former), not the accumulation of capital, that accounts for the spectacular economic growth of the past two centuries.
Peter Thiel said this...
We are biased toward the democratic/republican side of the spectrum. That’s what we’re used to from civics classes. But the truth is that startups and founders lean toward the dictatorial side because that structure works better for startups. It is more tyrant than mob because it should be. In some sense, startups can’t be democracies because none are. None are because it doesn’t work. If you try to submit everything to voting processes when you’re trying to do something new, you end up with bad, lowest common denominator type results.
Charles Darwin said this...
It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.
Dunkin Donuts is subject to some demand. I want it to be subject to the rest of the demand. But what about the demand from within Dunkin Donuts? Not democracy... or dictatorship... but demand.
Ellen Pao used to be the CEO of Reddit. Not any more. But the decision wasn't based on demand inside or outside Reddit.
Although, if there had been a net to capture all the outside demand... then I don't suppose anything would have prevented it from capturing all the inside demand as well. Any Reddit employee could have visited the demand clarity website and allocated some money for or against Pao stepping down as CEO.
Ah.... I really love market imperialism.
What's the demand for a movie about the first person to realize that horses can be used differently?