A Strong Position on Neutrality

May 092012
 

When we visit a grocery store, we can expect Kellogg’s breakfast cereals to be taking up a lot more shelf space than those of its smaller rivals. The big guys tend to have access to the best distribution channels.

On the Internet, though, a start-up website created by a guy sitting at home in his underwear has a real shot at going head-to-head with a much bigger rival, secure in the knowledge that his offerings can show up just as clearly and quickly as a far larger and more established site. This is what Eduardo Porter, who worries today in a New York Times column about the danger of losing Internet neutrality, wants to protect.

Companies offering broadband access, Porter suggests, should not be allowed to discriminate among services online. “If they did, the best service would not always win the day,” Porter writes. Instead, the winners would be those in the best position to cut a deal with AT&T, Verizon, Comcast or Time Warner—in other words, those with the deepest pockets and most clout.

In his book The New Realities, Peter Drucker noted that government regulation is sometimes required to keep the big players from smothering the small ones. Among the most complicated and controversial of government functions, Drucker wrote, is “to maintain what we today call a ‘level playing field.’ Government can set ground rules that are equally binding on everybody.”

In this respect, government “should be a good deal more activist than 19th-century liberals such as Herbert Spencer preached and wanted,” according to Drucker.

But, as we’ve noted previously, Drucker also strongly counseled businesses to rein themselves in. Wherever the elimination of a negative impact to society “requires a restriction,” Drucker wrote, “regulation is in the interest of business, and especially in the interest of responsible business.”

If an enterprise forgets this, it’s liable to generate public outrage—perhaps not immediately, but eventually—that results in punitive regulation. “If our social impacts are not right, it is the responsibility of the company to educate the customer and society so that the negative impact can be eliminated,” Drucker wrote. “The fact that today the public sees no issue is not relevant.”

What do you think: Should companies offering broadband access work to preserve Internet neutrality—for their own good, as well as for ours?

Taming the Malignant Masters

Mar 092012
 

Rick Wartzman

In his latest column for Bloomberg Businessweek online, Drucker Institute Executive Director Rick Wartzman springs off this week’s news that “Massachusetts Governor Deval Patrick is trying to slash government red tape so small businesses in his state can flourish.”

Wartzman goes on to add that if Patrick succeeds, “and these enterprises grow, they’d then be smart to listen to Peter Drucker and start reducing the red tape elsewhere: inside their own shops.”

Indeed, Drucker believed that, when it comes to cutting red tape, companies would do well to aim the scissors at their own operations. “The businessman in the large corporation who complains the loudest about bureaucracy in government,” Drucker asserted in his 1967 book The Effective Executive, “may encourage in his own company the growth of ‘controls’ which do not control anything, the proliferation of studies that are only a cover-up for his own unwillingness to face up to a decision.”

Wartzman goes on to spell out what Drucker deemed to be the proper use of reports, procedures and forms inside an organization—and where management often goes wrong.

“Reports and procedures are necessary tools,” Wartzman quotes Drucker as writing. “But few tools can be so easily misused, and few can do as much damage. For reports and procedures, when misused, cease to be tools and become malignant masters.”

Black and White

Mar 022012
 

Peter Drucker and Andrew Breitbart were both in the business of persuading people to act. But the similarities end there.

Breitbart, one of America’s foremost media provocateurs, died this week at the age of 43. A veteran of the Drudge Report and the Huffington Post, Breitbart launched several websites that promoted conservative, or at least anti-left, causes. His team launched stories and sting operations that were credited with, among other things, demolishing the nonprofit ACORN, bruising the National Endowment for the Arts and causing the resignation of now-former Congressman Anthony Weiner.

Breitbart’s means of persuasion were blunt, and his positions were firm, with minimal nuance and a maximum of black and white.

Image credit: Hizoku

Notably, Drucker took a much different approach to his work. As we’ve noted, no one knew entirely how to peg him politically. A 1960 memo from a Richard Nixon aide described Drucker as a “former left-winger,” and a late 1970s book described him as a “liberal-from-the-right.”

In the late 1930s, when predicting the Hitler-Stalin pact, Drucker recalled that he “immediately became an enemy for the Communists and the fellow travelers.” In 1942, in the Future of Industrial Man, he wrote, “Every liberal movement, it is true, contains the seeds of a totalitarian philosophy—just as every conservative movement contains a tendency to become reactionary.”

Drucker spoke with reverence of Victorian economist Walter Bagehot, in whom he saw a kindred spirit. “Like Bagehot I see as central to society and to civilization the tension between the need for continuity (Bagehot called it ‘the cake of custom,’ I call it civilization) and the need for innovation and change,” Drucker wrote in The Ecological Vision. “Thus, I know what Bagehot meant when he said that he saw himself sometimes as a liberal Conservative and sometimes as a conservative Liberal but never as a ‘conservative Conservative’ or a ‘liberal Liberal.’”

This didn’t mean that Drucker was inconsistent. It did mean that he took a different approach from that of Breitbart in shaping the “cultural narrative.” All of Drucker’s arguments were nuanced, and nearly all of his assertions, especially concerning politics, acknowledged competing priorities and tensions. Whether that made them persuasive is another question—and our question of the day:

When it comes to influencing people, what works best: being relentlessly black and white, or acknowledging the gray? Why?

The Feedback

Jan 312012
 

When we learned that several bigwigs at Davos seemed prepared to chuck capitalism, or at least modify it heavily, we had to ask our readers if they agreed. Should we replace modern capitalism with something else—and, if so, what?

Reader Greg Zerovnik suggested that rather than adjust capitalism, we may need to adjust ourselves. He wrote:

Capitalism is good at what it does. However, many societies appear to be ill-equipped to provide ethical and moral standards to effectively resolve the dilemma of what to do with the fruits of capitalism.

That is a separate issue altogether. We see China struggling with this. New power elites and a growing middle class are clearly emerging. Yet people are failing such simple tests as helping a fellow citizen lying injured on the street.

Reader Nathan, meanwhile, doesn’t see too much that’s seriously broken:

No system is or ever will be perfect, because we live in a world where humans are flawed. Unless everyone is always honest and selfless, the system will always have some type of flaw or problem. Ultimately, freedom is what should be pursued and practiced, and capitalism seems to promote this much better than any other system I know.

Perhaps reader ron gaesser offered the most succinct synthesis of these views:

What present day capitalism lacks is the ethical dimension that [Peter] Drucker seems always aware of.

That—plus space tourism, at least for now.

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