This interesting article on the search for a universal law explaining everything had this part that stuck out to me:
Figure 75 shows that commercial companies in the United States have a constant death rate independent of age—the life expectancy of a company at any age is about ten years. The short lifetime of companies is an essential feature of capitalist economics, with good and bad consequences. The good effect is to get rid of failed enterprises, which in socialist economies are difficult to kill and continue to eat up resources. The bad effect is to remove incentives for foresight and long-range planning. [emphasis added]
You'd think that in a free market system of competing companies, that we'd have learned whether or not long-range planning really works. Wouldn't some companies have tried it, found it worked, and either drove competition into the ground or compelled competition to match the planning effort?
But instead, all companies have an expected life expectancy of 10 years? No matter how long they've been around--and so no matter how much experience they'd had to learn from?
Which would include companies in capitalist systems that have the "benefits" of socialism through regulations or subsidies that try to keep them alive.
Doesn't this indicate that long-range planning doesn't really exist in our complex world? Doesn't this indicate that people can't project that far into the future with any detailed accuracy and can't adjust short-term actions to maximize the long-range projection? Or if they do the future is different than what the planned for and so their work was was wasted and just ate up their resources?
And doesn't the superiority of free market systems over socialist systems--which can have long-lived company-like entities that don't actually perform because they are difficult to kill and so eat up resources--indicate maybe the benefits of detailed long-range planning is a myth?
Maybe the sort life expectancy of companies isn't an essential feature of capitalism, but is actually an essential feature of the limits of human foresight that capitalism allows to be revealed unlike under socialism (or crony capitalism, which is similar) which makes companies difficult to kill.
Really, I keep hearing how the Chinese, because of their ancient civilization, are naturally good at long-range planning. Somehow foresight is in their genes. They don't live any longer than we do, but boy can they plan ahead!
When did the Chinese gain this superior planning ability? Surely not from the beginning since they were new then. So 1,500 years ago? A thousand years ago? Five hundred? Last week? When?
I ask because America, without that long-range planning ability as we are constantly told we don't have but which is needed for success, went from small groups of starving people clinging to the eastern shores of North America to a nuclear-armed dominant global power in 350 years.
Shouldn't China's long-range planning and foresight have kicked in by now to surpass that?
Heck, shouldn't Chinese-Americans have the gene and be planning the heck out of stuff here in America?
Also, why don't people speak of people in Greece, Egypt, Iran, India, Japan, or Korea as having long-range planning and foresight based on their ancient civilizations? Why just China?
Oh, sure, Jews have been around for so long as a culture that they can control the weather. But what else has a supposed long-range planning ability gotten them? Just weather control, periodic pogroms, ethnic cleansing, and a major effort at genocide?
And at a personal level, I've had a number of long range plans in my life.
I had two plans in college, one ended by a change in major and one ended by an engagement.
I had a plan early in marriage that changed when I got my career job in an area I had no idea existed.
I had a more narrowly based plan that was changed by spousal refusal to adapt despite earlier agreeing, and then parenthood--which I hadn't planned (but I changed my mind).
My plans for marriage obviously didn't work out as I intended. Although that wasn't so much a plan as an assumption, I suppose.
I had a couple post-divorce plans that were altered by life events. (Although funny enough, one narrow 8-year plan that did require a little luck panned out. But if it hadn't worked out, what I did during those 8 years would have put me in better shape for other possibilities.)
I had a post-retirement plan that was altered by life events.
I have a new plan forming now, that I'm pondering.
Yet I have no reason to think this plan, if carried out, will work as planned. Only one of my plans has worked, but with some good luck cancelling out some bad luck that might have wrecked the plan. So even that involved unanticipated events.
But my new plan doesn't have to work out. My life has worked out, sometimes in ways I couldn't have imagined, making my life so much better.
Or would the argument be that if I was Chinese-American rather than a European mutt that I'd have nailed my first plan and that would have been it?
As long as my planning involved improving things to get there (rather than "planning" to hit the lottery, for example), when life happened and threw problems and opportunities at me, I had the ability to adapt and move my life forward on paths I didn't--and couldn't--anticipate.
If you can't seize an opportunity because you can't mentally adapt or from your lack of preparation--or because you won't abandon your plan--that good luck might as well not exist.
And as I've told my children, any problem you have that can be solved by money you have available isn't so bad, really.
Sure, exceptionally good or bad luck at the far ends of the bell curve can overwhelm everything else. But that's not what usually happens.
Really, life is what happens while you are planning for a different life. And it worked out well for me.
Looking back on my life so far, if my first plan had worked like clockwork, I'd have missed out on so much joy and success that my actual path gave me.
And I suspect that an unnatural faith in the power of plans is just the outlook of control freaks who think they are uniquely the ones with the gifts of detailed foresight and long-range planning.
