Daily Archives: July 15, 2017

Silicon Valley is in the midst of an ethical crisis. A series of scandals in recent yearsfrom Theranos to Zenefits to Uber and the systemic problem of gender bias and sexual harassmenthave slowly eroded public perception of the tech industry. The venture capital ecosystem, long shrouded in secrecy, is increasingly being exposed for what it really is: a coterie of mostly white men who wield indiscriminate power over who has a chance at pursuing the American dream.

As the roots of the industrys blind idealism are being surfaced, critics often point to the outsize influence of Objectivism, the philosophy founded by author Ayn Rand, as a dangerous ideology that underpins the worst aspects of Silicon Valley culture. The philosophy, embodied in her books Atlas Shrugged and The Fountainhead, has impacted so many leaders in techfrom Peter Thiel to Evan Spiegel to Travis Kalanickthat Rand has been described as perhaps the most influential figure in the industry. Objectivism is probably best known for characterizing selfishness as a virtue.

Yaron Brook, executive chairman of the Ayn Rand Institute, is on a worldwide tour to promote the philosophy (and dispel its myths) and recently took some time to catch up with Quartz and discuss Objectivism as it relates to the Valleys ethical crisis.

QZ: One of the faces of Silicon Valleys ethical crisis, Ubers ousted leader Travis Kalanick, is famously inspired by Ayn Rand. Her name is now associated with affirming free-wheeling, sometimes-destructive cultures like Ubers in the name of disruption. What do you make of this?

YB: Silicon Valley for the most part has a completely confused understanding of what she even meant. There are entrepreneurs who are inspired by Ayn Rand, who get emotional fuel, a certain amount of courage, audacity, and spunk because of Ayn Rand. I dont think Travis Kalanick ever claimed to be an Objectivist. He said The Fountainhead was his favorite book. Very few of them actually sit down and say, Wow, thats a life-changing philosophy here. In some sense I understand it: theyre too busy living their lives, too busy changing the world and they take what they can from it. They get it superficially: go act, be entrepreneurial, start a business.

How does Silicon Valley get Ayn Rands philosophy wrong?

Theres a misinterpretation of what she meant by selfishness. The classic way they get it wrong is simply believing that Ayn Rand says do whatever you feel like doing, dont care about other people, just do whatever is good for you. And theres no delving into what she means by good for you. Being selfish is really hard work. It means really thinking about what are my values, what are the most important things to me, how do I rank them, and how do I actually pursue them in a rational, productive way? Ayn Rands philosophy is very challenging.

Bernie Madoff is a great example [of misinterpreting selfishness]. Does anyone really think that Bernie Madoff sat down one day and thought, I want to live the best life that I can live? He didnt think. The whole point of Objectivism is living by what Ayn Rand calls the trader principle: to create as many win-win relationships as possible. Trade is always win-win. Its a spiritual transaction, not a financial transaction.

America has traditionally been an anti-intellectual culture. And this is also true of Silicon Valley. Look at Peter Thiel, who says dont go to college, just start a business. Now thats goodif you have a good intellectual foundation.

The term conscious capitalism has gained traction in recent years, first popularized by Whole Foods CEO John Mackey (whose company was just acquired by Amazon) and now part of Silicon Valley jargon. Why do these entrepreneurswho are the very faces of free-market capitalism and the American Dreamfeel the need to qualify their pursuits by describing it as conscious?

Conscious capitalism is a meaningless term. What John Mackey means by it is, we create win-win relationships out there, we care about our customers, we care about our employees, we care about our community. Of course they do. Capitalism requires the best in human beings. Anything good that capitalism claims to be is implicit. We dont need a new term for it. Whole Foods is just another grocery chain with a great marketing campaign. I dont think Jeff Bezos will buy into this conscious capitalism.

Facebook CEO Mark Zuckerberg is among the Silicon Valley leaders who have really embraced the concept of conscious capitalismhes working hard to convey a mission-driven image around a for-profit company. Do you think this kind of personal branding is working for him?

Mark Zuckerberg is a conflicted guy. All you have to do is read his open letter to his daughter. Hes very torn between what he doeshis love of his own life, his mission, his passionand being Mother Theresa. He still buys into that morality of sacrifice and selflessness and living for other people. He hasnt replaced his philosophy.

As long as your fundamental moral ideals are focused on the other, the measure of morality is how much you sacrifice for the other. Look at Bill Gates. He is a giant in terms of improving the condition of mankind. Yet he gets zero moral credit for it because he made so much money doing it. So he feels that in order to get moral credit, to be viewed as a good person, he has to give his money away. But hes doing it because he feels guilty, or he thinks he should feel guilty. It might be the second. He does these things to appease this conventional morality that exists out there.

Is the hype around Universal Basic Income a byproduct of this kind of guiltSilicon Valley leaders seeking to justify eliminating millions of jobs, replacing them with robots?

Silicon Valley entrepreneurs tend to think that theyre superior and the rest of humanity cannot take care of itself. I believe that people left alone, given the right tools, almost everybody can take care of themselveseven in a world of robots.

This interview has been condensed and edited for clarity.

Read this article:

Does Silicon Valley need even more Ayn Rand to fix its ethical crisis? - Quartz

Books that arent business manuals

Heres a New York Times article about several business and political people whove cited Ayn Rands work as influential, mostly The Fountainhead and Atlas Shrugged, but have managed to find themselves in trouble of one kind or another.

Ubers former CEO Travis Kalanick is featured and a few members of the Trump Administration, including Trump, are mentioned as devotees. Whats weird is that Atlas, for example, isnt so much Kicking Ass at Business for Dummies as it is a philosophic tome filled with cartoony heroes and villains:

Rands entrepreneur is the Promethean hero of capitalism, said Lawrence E. Cahoone, professor of philosophy at the College of the Holy Cross, whose lecture on Rand is part of his Great Courses series, The Modern Political Tradition. But she never really explores how a dynamic entrepreneur actually runs a business.

She was a script and fiction writer, he continued. She was motivated by an intense hatred of communism, and she put those things together very effectively. She can be very inspirational, especially to entrepreneurs. But she was by no means an economist. I dont think her work can be used as a business manual.

To be fair, no one gets inspired by economics. They get inspired by art! They get inspired by thinkers! Rand did a lot of thinking and writing, but not any business or economics stuff. It would seem that some people have conflated her philosophy and the nuts and bolts of running a business. This includes Kalanick, who is the main punching bag in this article:

Yaron Brook, executive chairman of the Ayn Rand Institute and a former finance professor at Santa Clara University, who teaches seminars on business leadership and ethics from an Objectivist perspective, said, Few business people have actually read her essays and philosophy and studied her in depth. Mr. Brook said that while Mr. Kalanick was obviously talented and energetic and a visionary, he took superficial inspiration from her ideas and used her philosophy to justify his obnoxiousness.

Right. Its like if Elon Musks inspiration for going to Mars was Oh, the Places Youll Go! Sure, thats a great story that helps us realize that life is exciting and full of wonder. But that balloon isnt getting us to the cosmos.

Speaking of art, heres a Justice Department press release announcing charges against Earl Simmons, better known as DMX, and it includes this wonderful quote from U.S. Attorney Joon Kim:

For years, Earl Simmons, the recording artist and performer known as DMX, made millions from his chart-topping songs, concert performances and television shows. But while raking in millions from his songs, including his 2003 hit X Gon Give it to Ya, DMX didnt give any of it to the IRS.

Ah, yes. Nothing satisfies quite like bureaucrats playing off a movie or a song to quip about someone evading this basic obligation of citizenship. The quote continues with this amusing tale:

DMX allegedly went out of his way to evade taxes, including by avoiding personal bank accounts, setting up accounts in others names and paying personal expenses largely in cash. He even allegedly refused to tape the television show Celebrity Couples Therapy until a properly issued check he was issued was reissued without withholding any taxes.

Were all thinking the same thing, right? DMX barked at an accountant until he wrote a check for the gross amount. Yep, just wanted to make sure. Simmons faces 14 charges, with the possibility of a lengthy prison sentence.

The featured job of the week is a Senior Accounting Specialist with FloQast in Los Angeles.

I called attention to the SEC Fort Worth Offices hilarious Twitter account. Megan Lewczyk wrote about net neutrality.

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Image: iStock/rarrarorro

Original post:

Accounting News Roundup: Books That Aren't Business Manuals ... - Going Concern

The Fountainhead, part 1, chapter 10

John Erik Snyte excitedly tells his designers that their firm has the chance for a big, important commission. Theyve been hired to build a house for Austen Heller, the rich and well-connected libertarian writer (Heller is Rands literary stand-in for H.L. Mencken, if that helps you picture him).

The only complication is that Heller wants something new and different, hes already rejected proposals by three other firms, and hes picked a remote and difficult spot to build on:

Later that day Snyte crowded his five designers into a train, and they went to Connecticut to see the site Heller had chosen. They stood on a lonely, rocky stretch of shore, three miles beyond an unfashionable little town they looked at a cliff rising in broken ledges from the ground to end in a straight, brutal, naked drop over the sea, a vertical shaft of rock forming a cross with the long, pale horizontal of the sea.

There, said Snyte. Thats it. He twirled a pencil in his hand. Damnable, eh?

Howard Roark has been working at Snytes firm for five months, but the time stretched behind him like a blank. He hasnt cared about anything hes done there enough to even remember it. But the Heller house speaks to him at a deep level. After days of work at the drafting board, he has a proposal:

The house on the sketches had been designed not by Roark, but by the cliff on which it stood. It was as if the cliff had grown and completed itself and proclaimed the purpose for which it had been waiting. The house was broken into many levels, following the ledges of the rock, rising as it rose, in gradual masses, in planes flowing together up into one consummate harmony. The walls, of the same granite as the rock, continued its vertical lines upward; the wide, projecting terraces of concrete, silver as the sea, followed the line of the waves, of the straight horizon.

The one good thing Ill say for this is that its the closest Ayn Rand has come to describing a Howard Roark house in terms I can picture. It has many levels (so I guess the building is shaped like a staircase?), with sheer fortress-like granite walls and multiple terraces or balconies that project out over the sea.

I mean, okay. Id agree that sounds like a modernist house. Its not everyones cup of tea, but Im sure the right person would like it. Is that really what all the fuss was about?

This is a common problem that authors face when they have a hero whos The Best Ever at something like art or music. If you just assert the heros greatness, the reader will want to know what makes him so darn special. But the harder you try to describe his achievements, the more you run the risk of diminishing them and making them sound mundane.

This is a case in point. Its not enough for us to know that Roark builds houses with big windows and lots of geometric shapes. We have to believe that his houses are somehow perfect in a Platonic sense (oh, the irony!) they have some unique and distinctive quality that makes them different from all others, even other modernist buildings; or that they have some sort of transcendent harmony such that not a line could be changed or a window moved without completely ruining them. You can use as many effusive metaphors as you want, but no actual building is going to faithfully create that impression.

Its the same problem that the filmmakers of Atlas Shrugged faced in their casting: its impossible to use real human beings who are as physically distinct as Rand described them. The language necessarily falls short of any concrete reality.

Snyte does his usual thing, combining the ideas of his designers into a mix-and-match whole. Two days later, theyre all looking at the elaborate watercolor drawing thats going to be presented to the client:

It was Roarks house, but its walls were now of red brick, its windows were cut to conventional size and equipped with green shutters, two of its projecting wings were omitted, the great cantilevered terrace over the sea was replaced by a little wrought-iron balcony, and the house was provided with an entrance of Ionic columns supporting a broken pediment, and with a little spire supporting a weather vane.

Heller comes in to render his verdict on the proposal, and everyone metaphorically holds their breath:

This, said Heller suddenly, loudly, slamming his fist down on the drawing, and Snyte winced, this is the nearest anyones ever come to it!

I knew youd like it, Mr. Heller, said Snyte.

I dont, said Heller.

Heller wistfully says that the house is almost right, but its missing something, some central idea he cant define. Roark pounces:

Roark turned. He was at the other side of the table. He seized the sketch, his hand flashed forward and a pencil ripped across the drawing, slashing raw black lines over the untouchable water-color. The lines blasted off the Ionic columns, the pediment, the entrance, the spire, the blinds, the bricks; they flung up two wings of stone; they rent the windows wide; they splintered the balcony and hurled a terrace over the sea.

It was being done before the others had grasped the moment when it began. Then Snyte jumped forward, but Heller seized his wrist and stopped him.

Snyte fails to appreciate the effort:

As Heller said nothing, Snyte felt free to whirl on Roark and scream: Youre fired, God damn you! Get out of here! Youre fired!

Were both fired, said Austen Heller, winking to Roark. Come on. Have you had any lunch? Lets go some place. I want to talk to you.

Roark went to his locker to get his hat and coat. The drafting room witnessed a stupefying act and all work stopped to watch it: Austen Heller picked up the sketch, folded it over four times, cracking the sacred cardboard, and slipped it into his pocket.

But, Mr. Heller Snyte stammered, let me explain Its perfectly all right if thats what you want, well do the sketch over let me explain

Not now, said Heller. Not now. He added at the door: Ill send you a check.

Then Heller was gone, and Roark with him; and the door, as Heller swung it shut behind them, sounded like the closing paragraph in one of Hellers articles. Roark had not said a word.

Ive often complained that for someone who idolized capitalism the way she does, Rand made her heroes shockingly bad at business. But this scene shows that its really not just her heroes, its all her characters. Why was Snyte so furious that Roark scribbled all over the watercolor?

Yes, the text implies that Snyte has some kind of obsession with the sanctity of his drawings. But they already knew that Heller didnt like it. It was worthless as soon as they found that out. For once, Roark was the one doing the reasonable thing by making a last-ditch effort to save the project (although really he should have just gone back to his desk and gotten one of the sketches hed already done but of course that wouldnt have afforded the opportunity for his manly, dramatic pretend-demolition of the mongrelized watercolor).

However, I do have to question Roarks sense of loyalty. Even though Snyte immediately backtracked and offered to produce another sketch more to Hellers liking, Roark ignored him and walked out on his erstwhile employer, taking the big important client with him. Is this how you ought to treat someone who took a chance on you?

Remember, at the time Snyte hired him, Roark had been out of work so long and was so desperate he was reduced to reapplying to firms that had already rejected him. Snyte saved him from destitution at a crucial moment. And how does Roark reward him for this? By quitting and founding his own competing firm at literally the first opportunity he gets, poaching a major client in the process!

Such behavior would get you blacklisted in the real world, and for good reason. Basic ethics, not to mention common sense, suggests that its a bad idea to stab someone in the back after they helped you out in a big and risky way. But thats a consideration thats foreign to Randian protagonists, who regard other human beings as nothing but stepping stones they can tread on along their way toward getting whatever it is they ultimately want.

Other posts in this series:

Read more:

The Fountainhead: Job-Hopper - Patheos (blog)