Blaming Failure On The System Actually Does Have Some Benefits…
from the before-we-trash-everything-here... dept
A bunch of folks have sent in Daniel Gross’ excellent review of the World Economic Forum in Davos last week, where he bemoans the fact that no one is willing to step up and take the blame (or even find people who should shoulder the blame) for the economic collapse we’re all living through. He has a great line near the beginning:
Success is the work of Great Men and Great Women, while failure can be pinned on the system.
Indeed, in reading the article, I definitely agreed, and sometimes I find it troubling that we credit success stories to individuals who were often much more lucky than anyone cares to imagine, and when failure occurs, no one’s willing to admit that they had any part in it. However, in thinking about it some more, I’m less and less sure that this is a bad thing. In many ways, it’s actually an important part of creating future success stories.
If we went around blaming individuals for every failure, it creates tremendous incentives not to take on the necessary risk to create those next breakthroughs. The difference between success and failure is often such a fine line it’s difficult to see. In almost every success story you hear of one or two minor things that could have brought the whole thing crashing down if things had gone differently. But in celebrating the “heroes” associated with success, we create incentives for others to experiment and take necessary risks. In not punishing the individuals behind the failures too harshly by calling them out for “blame” we don’t create incentives to avoid those necessary risks. That’s a good thing.
That isn’t to say that we shouldn’t look at what happened and why it went wrong, but it’s right to look at the systems that went wrong and how to fix them, rather than calling out people to tar and feather. That’s counter-productive and only makes it that much more difficult to encourage the next generation of entrepreneurs to take the necessary risks to create economic growth.
Of course, there is one additional point that needs to be made here. Despite what I said above, there is a significant problem when we interpret that initial sentence to mean we should then socialize the loss — and pin the effects of it on taxpayers, which seems to be exactly what this country has done all too often.