The Modern Survival Guide #85
This is the Modern Survival Guide, a guidebook I’m writing for things I think people need to know about living in the modern world. The views expressed here are mine, and mine alone. And I am fascinated with the way our world works — it’s why I’m writing this series. Over the next six articles I’m going to be taking a long look at how different things mesh together to create a society that works (for a given value of “works”).
We’re kicking it off with an article on individuals, and the role they play. Following this will be articles on institutions, culture, incentives, and history. Then we’ll end this little mini-series on an article on how all that ties together (which I have tentatively and creatively titled “Why Things Are the Way They Are”).
Oh yeah, it’s one of those topics. Grab an energy drink, folks. We’re diving in.
The Society Wheel
Let’s start with a simple premise: nothing happens in isolation. Individuals influence, and are influenced by, their society in myriad and sundry ways. To simplify that a little bit and set the stage for the next few articles, I’m going to be working off the following chart, which I call the Society Wheel:
The basic idea here is that individuals create and influence institutions, which create and influence culture, which create and influence incentive structures, which influence and direct individuals, and round and round we go. The product of all this motion and energy is what we call society. And no, I’m not saying that the chart doesn’t sometimes flow the other way, or that these arrows always link up as shown… but I think this is the most common orientation.
Individuals have the top box, and they hold it for a reason.
Individuals Have Power Through Institutions
One man by himself ain’t worth a damn, as the old timers used to say where I grew up. A man in isolation is vulnerable, weak, prone to error, and lonely. Vulnerable, because the slightest injury is potentially fatal. Weak, because there are some things for which you simply need more than two hands. Prone to error, because you never see the rock that trips you. And lonely, because… well… that’s how things are when you’re alone.
So it shouldn’t be any surprise that the very first thing that happens when you throw a few people together is that they create institutions.¹ They start figuring out ways to work with, or at least around, each other. They start figuring out ways to interact with each other. They start inventing new languages and customs. And this happens fast, because while one man by himself ain’t worth a damn, two men in resource competition are worth a war. It is a survival trait of the human species to develop institutions to prevent that from happening and create conditions that allow for at least some level of coexistence.
Those institutions go on to have lives of their own, and we’ll talk about them in the next article. The important thing to take away from this bit is that institutions do not create themselves. They do not emerge in the world spontaneously and fully formed. They require individuals to create them, run them, nurture them, and in the fullness of time, kill them off and set up a new institutional framework.
That gives individuals a very large amount of power in determining how the world works. I just violated the theory structure of a whole branch of political science by saying that. I know, I know, I’m such a rebel.
Let’s take a look at that statement though, because it deserves a bit of elaboration. We tend to think of institutions — particularly large organizations — as monolithic entities, and to some extent they are. But every corporation has a CEO. Every church has a priest. Every NGO has a board of directors. Every marriage is composed of partners. And while the largest institutions can and do act as super-organisms,² the individuals who comprise them are responsible for the direction of the institution.
For example, every government has some form of executive office. Your city or town has a mayor, for example. City government is an institution, and it will have bunches and bunches of traditions, regulations, rules of conduct, and corresponding cultural limits and inbuilt incentive structures. It may be capable of “independent” action as the mechanisms of the institution dictate things the city’s civil servants do. Nonetheless, electing a very good or very bad mayor will have immediate consequences, because the mayor calls the shots. They can change the institution’s mission, dismantle pieces of it, and set up new institutions. The mayor has power.
On a lower level, no institution is capable of performing its own work. You don’t see construction companies’ office buildings wielding shovels to break ground on a road. The individuals who comprise the institution’s workforce do the work, and good or bad work has a series of consequences for the institution.
To return to the city government example, cities employ health and safety inspectors to audit local restaurants and make sure they’re safe places to eat. If the health inspector does a bad job, people tend to get sick. If enough people get sick, the city government has to respond to a crisis. And if the crisis goes on long enough, major changes will happen to the city government as citizens demand action.
Institutions are therefore extremely dependent on the actions of their constituent individuals for survival and success. And make no mistake, when individuals act it is usually through the medium of one institution or another. There isn’t really any such thing as a “super empowered individual.”³ There are simply individuals who are better positioned to act through a strong institution.
To take an example, let’s consider the case of a billionaire. We consider a billionaire to be very important and powerful, because they have a lot of money. Their empowerment comes from their ability to spend that money on things they want, need, or think are important. But to do that they are working through a whole host of institutions:
- The financial system itself is a whole series of huge institutions, without which utilizing money is much more difficult.
- The assumption by the population that money has value is itself a cultural assumption emerging from our financial and political institutions.
- The businesses and organizations that receive money and turn it into actions, goods, and services are each institutions in their own right.
- The political system that enables, protects, or imposes itself on all of these other institutions is itself another series of institutions.
The billionaire is not powerful because they have money. They’re powerful because they have money and that means they have a resource that they can use to influence or control institutions that exist to turn money into tangible actions and products. A billionaire alone on a desert island is just a guy who needs to quickly learn how to open a coconut without tools. Without the institutions of society, he’s just a smart primate.
Incentives Drive Individuals
On the other side of the Wheel, individuals are the target for the vast majority of society’s incentive structures. Why do I get up in the morning and go to work? Well, if I’m extremely lucky, it’s because I enjoy my job and I want to do it because it makes me feel validated. But for most of us, we get up in the morning and go to work because we need the money.
Now here’s the thing: both of those motivations are forms of incentive, and both are created by the society we live in. The various cultures in which we live spawn incentives at a prodigious rate in order to move the Society Wheel.
It is a cultural expectation that we do work for money, for example. Therefore if someone wants me to do work, unless they are a very close family member or friend, I’m going to need some money. Money is a fantastic incentive because so many of our institutions are set up to deal with it in some form or fashion, and having money lets you access those institutions.
On the flip side, if a very close family member or friend wants me to work for free, there are cultural expectations that create incentives that most likely obligate me to provide some free work, provided that I like them and want to remain in their good graces. You help a friend move apartments partly because that’s what it means to have a friend and the incentive structures are set up such that you value their gratitude (not to mention the likelihood that they might return a favor for you in the future).
And yes, sometimes people do work out of the goodness of their heart. But that’s still an incentive. That warm feeling of accomplishment is there for a reason — it’s the human species telling you that social capital is a good thing and valuable for your long-term survival.
Basically, everything we do, we do for a reason based on some form of incentive. If the reason is a traditional exchange of goods and services, in service to a relationship, or performed out of some sense of obligation, society tends to work. When people do things at random, or in service to an incentive structure that doesn’t conform to these patterns, we call them crazy people. It is useful and instructive to look at the world through that lens from time to time, and will give you a better sense of why our society operates the way it does, and why other societies operate the way they do. The differences are often due to the way incentive structures differ.
To take an example, we do not consider cannibalism to be a good thing in America, because we look at cannibalism through the lens of one person using another person for resources in the most basic sense. Our incentive structure surrounding this event is therefore built on a foundation of fear: cannibalism is considered bad because I am afraid someone might eat me when they get hungry.
There are other ways to look at cannibalism, however. When viewed through the lenses of numerous religions, the incentive structure of cannibalism changes. Rather than being looked at as primarily a question of food resources and associated predator-prey relationships, cannibalism becomes a practice to preserve a person’s essence for the tribe, or provide a pathway to God, or achieve a totemic link to a past figure (I’m looking at you, Christians). This takes cannibalism from a realm of horror to a realm of ritual institutional acceptance.
And no, I’m not advocating cannibalism. This is simply an example that shows how a change in incentives changes the ways that individuals interact with the world.
The point is that we are surrounded by incentives. They influence our every action, every day, in every way. You can’t escape them, you can barely influence them, but you can understand them — and knowledge is power. In this case, it gives you the power to identify the incentive you want to change, which is most often accomplished by influencing an institution which then change some aspect of our culture, which then changes the incentive structures.
Individuals on the Society Wheel
I started this set of articles with a discussion of the individual’s place in the Society Wheel for a damn good reason: they are the only point on the Wheel where rational thought actually happens. Therefore they are the only point in the Wheel that is actually a source of deliberate change. The other boxes on the Wheel are largely the result of individual actions — deliberate and otherwise — which have either intended or unintended consequences.
This is not to say that the other boxes are less important. Far, far from it. Let’s not forget that the universe is the result of a series of chaotic changes and unintended consequences.⁴ Chaos is super important and super interesting. But the neat thing about human society is that individuals have a lot of agency in determining how things work, and it all comes back to their interactions with incentives and institutions. If you want to change society, you look to individuals, and you look at how the incentives they receive and the institutions they can access line up.
For these reasons, individuals are important. Their relative power and autonomy in society are important subjects, and it is a serious mistake to place too much focus on the other points on the Wheel without thinking about individuals first.
Individuals create institutions, which influence cultures, which provide incentives, which influence individuals, and round and round we go. But only individuals can provide direction for the Wheel.
¹Ok, I just used a technical term. When I say “institution,” I’m referring to any established practice, custom, or organization. “Institution” is a very broad term, but it’s important to apply it accurately.
²Another technical term, my apologies. A super-organism is an organization that functions as an organic whole, which may appear to make decisions independent of its component organisms, and which is composed of individuals which cannot survive on their own in the super-organism’s environment.
³A third technical term! An empowered individual is one who has power within their environment. A super-empowered individual is one who has a lot of power. Simple, yes?
⁴Prove me wrong.