Why the best is no better than the rest

WE live at a moment in time when the old model and values do not work anymore.

When US President Donald Trump proclaimed America First, he could not imagine that the United States would be first in the number of coronavirus infections (over 1.2 million) and most deaths (over 70,000).

Few could have imagined that the most powerful economy with the best scientists, technocrats and universities can be brought down in a matter of months from near full employment to a “90% economy”, with more than 30 million unemployed.

Those of us who believed the

Hollywood mythology of “one for all and all for one” as in “Saving Private Ryan” cannot imagine that America is willing to sacrifice more than 100,000 lives to the pandemic in order to re-open the economy earlier.

Has money become so important that human lives no longer matter?

American capitalism works on the basis that all people are free to pursue their goals, so the best and most competitive can rise to the top, study at the best universities and become No. 1.

Competitive freedom is at the heart of a meritocratic and technocratic society. As long as the country is run by the best and brightest, there will be a better, freer world. But history has shown that what looks best may not be better than the rest of us.

British sociologist Michael Young invented the word meritocracy in his 1958 satirical book “Rise of the Meritocracy, 18702033”. He argued, “today we frankly recognise that democracy can be no more than aspiration, and have rule not so much by the people as by the cleverest people; not an aristocracy of birth, not a plutocracy of wealth, but a true meritocracy of talent.”

Young foresaw that the rise of the meritocratic class would divide society into an elite and a populist non-elite who come to realise that the elite would govern not in society’s interest, but in their own narrow interest.

This abuse of power by the elite is exemplified by the shareholder value model of corporate governance which suggested that a company should pay its management top dollars to maximise shareholder value. The best management talents are given share options to align their interest with those of the shareholders.

This assumes that profitable and efficient companies will create value for shareholders and society. In practice, many managers used valuable corporate cash for share buybacks to prop up the value of their share options, sell out valuable assets to maintain quarterly earnings and sack staff whenever profits are threatened.

The best is not working for the rest when they are looking out for their own interests first.

In his latest book on the current American order “The Storm before the Calm (2020)” geopolitical strategist George Friedman correctly identified that since 1980, new technology has divided America into a technocracy class, product of the best universities, and the rest, mostly working in the old industrial economy that is losing both market share and value.

The technologists include financial engineers, filmmakers and tech savvy generation that benefit from the massive increase in leverage, asset and tech bubbles in valuation. The losers were the largely white middle class trapped in the low-tech and marginalised industrial/agriculture bases.