Amerika

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Workers Fear Capitalism Because They Cannot Understand It

The Buddhists tell us to be aware of what is most properly called the defensive mind, an impulse to blame the world that results in contrarian behaviors, something we see played out daily through the scapegoat-talisman dichotomy in human thinking. People blame a scapegoat for all that is wrong, and superstitiously rely on a talisman to make things right.

Notice what is missing there: human agency and the cause-effect thinking that empowers it.

Humans like the scapegoat-talisman because it allows them to style the world in terms of their own inaction. They do not have to do anything other than follow the herd toward the talisman and away from the scapegoat; they make social decisions, not real-world choices, and so they remain blameless in their own minds.

As a result, humans specialize in ignoring attributes of reality that scare them, and instead projecting them into scapegoats, which requires creating talismans to balance. Thus we get “good” and “evil” in their primitive form — good (for me) and bad (for me) — elevated to a universal token set by the power of language.

For example, workers commonly scapegoat “capitalism” for their problems, but it turns out that workers are incompetent at understanding market forces and are blaming others for this defect:

As a top-line figure, the study indicates that workers who would experience a 10% wage increase by switching firms only expect a 1% wage increase instead, leading them to earn less than they otherwise might.

That is one of multiple related findings in the study, which also shows that workers in lower-paying firms are highly susceptible to underestimating wages at other companies; and that giving workers correct information about the salary structure in their industry makes them more likely to declare that they intend to leave their current jobs.

The study also has implications for further economics research, since economists’ job-search models generally assume workers have accurate salary information about their industries.

A basic translation of this is that workers do not know the market value of their work and overestimate how much others are getting. This allows for a victimhood pathology where they see themselves as underpaid and others as grossly overpaid, not realizing that market forces determine both wages.

You commonly see this situation. A worker who is better at his job than the others gets paid more; a company that consistently produces better quality goods or services charges more for its work. To the average worker, this is mysticism, not the market rewarding those who produce more value.

Even more, very few of them are able to distinguish leadership ability from simply being a reliable worker, which is why accidental managers are the norm:

A staggering 82% of new managers in the UK are what the Chartered Management Institute (CMI) calls “accidental managers”, according to a YouGov survey commissioned among 4,500 workers and managers in June, which has recently been published.

Accidental managers are people that have moved up the corporate ladder with no formal training in management or leadership. To put it simply, they are not correctly trained or equipped to manage people. Among those workers who told the CMI’s researchers they had an ineffective manager, only one-third said they were motivated to do a good job and as many as half are considering leaving in the next 12 months.

This occurs because people in workplaces tend to choose communicators and memorizers as the best among them, instead of looking at actual value of production:

To test whether group members who choose the occupants of network positions select themselves and others that best suit skill requirements of the position, the authors compared the performance of groups whose members received their choice of who occupied which network position to the performance of groups whose members did not. They conducted a lab study that involved nearly 125 university students. They had two experimental conditions: in one condition, members received their choice of who occupied the central position; in the other condition, members did not receive their choice.

Allowing group members to choose who occupies which network positions enabled teams to optimize their position assignments based on individuals’ skills and expertise (e.g., organization, delegation), which boosted groups’ performance. Team members were more likely to choose individuals who communicated frequently and those who appeared to have task-related expertise to occupy the central network position. Teams receiving their choice of central member performed better than teams not receiving their choice or teams in which members were randomly assigned to the position.

This means that the workers have no idea why they get paid or what it is actually worth. They see those who are most verbal and demonstrative getting ahead, and assume that this is productivity, therefore see productivity as unrelated to their own output, but this is a result of their misunderstanding of their value in the first place.

Workers tend toward anti-competitive actions like unions and subsidies as a result. They fear the contest they do not understand, which is part of capitalism, so they scapegoat that. However, competition is the basis of capitalism, and as it turns out this may be what workers need to keep engaged:

The team’s findings suggest that workers on factory assembly lines will be more productive, engaged and motivated—but also more stressed—if repetitive activities like fitting parts together are incentivized through competition or rewards.

They are more stressed by it because they can lose. A worker who does not produce becomes of lower value; however, a worker who finds attempting to produce becoming a game hates his job less and has more to shoot for, therefore has a healthier mental outlook.

This is more complex than blaming capitalism and clinging to subsidies as salvation however.

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