"CEOs can't wait to read Sunny Bindra's articles every week."

Who is paid NOT to understand?

Image by pasja1000 from Pixabay

Do you sometimes wonder why a perfectly reasonable position is often rejected by very intelligent people? You might lay an argument out, back it up with solid facts – and still encounter vehement opposition. Surprisingly, this resistance often comes not from the ignorant or the uneducated, but from those who have the knowledge and acuity to appreciate the point being made.

The first thing to remember is that most people argue from their gut, not their brain. They imbibe prejudice early in life, and harden their outlook accordingly. Much of what ensues thereafter is just a relentless train stuck on the steel tracks of confirmation bias. New facts and new arguments encountered en route do not open new thinking. The offensive ones are ignored; those that support preset ideas are filtered out to reconfirm what is already believed.

That aside, there is another very strong reason why reasonable people can take on unreasonable positions. It was expressed best by Pulitzer-Prize-winning author Upton Sinclair:

‘It is difficult to get a man to understand something, when his salary depends on his not understanding it.’

This concerns the power of incentives. When people oppose reasonable arguments vigorously, it behoves us to look carefully at where their reward comes from.

John Bogle, he who revolutionised the investment industry, often picked up on Sinclair’s words. He pointed out that the people who give you personal investment advice often make a lot of money for themselves – at your expense. Most small investors are unaware of the heavy cost of the fees that managed investments impose. And it is not in the interests of those selling you the products to point this out – they make their money by charging you more than you need to pay, and hoping for your ignorance.

The life lesson is this: keep a very careful eye on the incentives of those you have to work with. It will help you understand what ensues.

For example, the key incentive of a government minister is to defend the government of the day. You can marshall all the arguments you want about a policy change; those who are paid to defend the existing policy will do so with gusto, even with anger. Their resistance will only change when the incentives change, or when the paymaster whistles a different tune.

Similarly, you might be perplexed when a pundit or intellectual you respect suddenly espouses surprisingly pigheaded views. Don’t be. You probably need to look no further than the fact that incentives have changed.

I have pointed out another example here before: there are those who believe Africa is currently the best investment destination ever; that everything is positive and vibrant; that governments are progressive and transparent; that policy is enlightened and supportive; that the middle class’s purchasing power is exploding. Sitting right next to these people is another group, equally educated, who will tell you that it’s all gloom and doom; that de facto dictatorships abound; that an economic reckoning is coming.

You know what to do now. Look for the paymasters and payoffs on both sides. They explain a lot. Many intellectuals are paid not to understand. You are better off looking through the maze of incentives to gather your own understanding of the situation.

This is not to say that everyone is equally affected by pecuniary incentives. Some people, though rare, respond to a higher set of incentives. Their reward comes from doing what is right – even though that may cost them greatly in financial terms. These are the folks whose opinions I personally give the greatest part of my attention.

Look out for those who refuse to take high-paying positions if their fundamental principles are in discord with the work on offer. Look out for those who refuse high-paying assignments from clients whose morals are in doubt. Look out for those who resign if their values are offended. Look out for those who tell you not to buy from them, because you will do better elsewhere.

You won’t find many such people. When you do, take note. You will find that they dance to a higher-order music. Their sense of achievement and meaning is not confined to the cage of personal payoffs. They are here to play bigger, even if fortunes are forsaken in the process. Perhaps you can find such a person in the mirror someday.

(Sunday Nation, 16 June 2019)

Sunny Bindra’s new book, The Bigger Deal, is now on sale.

Buy Sunny Bindra's book
here »

Share or comment on this article