Columns, Corporate Life, The Today Paper, Work and Life

How Much is Talent Worth?

Singapore needs foreign talent. This need is nothing to feel bad about. It is a statistical fact of life. For every top Singaporean in any field — be it science, medicine, finance, sports or whatever — we will find about 500 professionals of equal caliber in China and India. Not because we are 500 times less talented, just that they have 500 times more people.

Coupled with overwhelming statistical supremacy, certain countries have special superiority in their chosen or accidental specializations. We expect to find more hardware experts in China, more software gurus in India, more badminton players in Indonesia, more entrepreneurial spirit and managerial expertise in the west.

We need such experts, so we hire them. But how much should we pay them? That’s where economics comes in — demand and supply. We offer the lowest possible package that the talent would bite.

I was on an expatriate package when I came to Singapore as a foreign talent. It was a fairly generous package, but cleverly worded so that if I became a “local” talent, I would lose out quite a bit. I did become local a few years later, and my compensation diminished as a consequence. My talent did not change, just the label from “foreign” to “local.”

This experience made me think a bit about the value of talent and the value of labels. These values translate to compensation packages that can be ordered, from high to low, as: Western (Caucasians), Western (of Asian origin), Singaporean, Asian (Chinese, Indian, etc.).

I’m not saying that all Caucasians in Singapore do better than all Indians and Chinese in terms of income; but the trend is that for the same talent, Caucasians tend to be better compensated that their Asian counterparts. Nothing wrong with that — it’s all about demand and supply, and the perception of value and such economic fundamentals. Besides, this compensation scheme has worked well for us so far.

However, the locals are beginning to take note of this asymmetric compensation structure. When I was considering hiring a Caucasian, my ex-boss commented, “These Ang-Mos, they talk big in meetings and stuff, but don’t do any work!” He may have oversimplified; I know many “Ang-Mos” who are extremely talented and fully deserve the higher-than-local compensation they enjoy. But this perceived disparity between what the talent is worth and how much it costs (as depicted in the movie I Not Stupid) is beginning to hurt employee loyalty to such an extent that firms are experiencing staff retention issues when it comes to local talents.

The solution to this problem is not a stricter enforcement of the confidentiality of salaries, but a more transparent compensation scheme free of anomalies that can be misconstrued as unfair practices. Otherwise, we may see an increasing number of Asian nationals using Singapore as a stepping stone to greener pastures. Worse, we may see locals seeking level playing fields elsewhere.

Let’s hire the much needed talent whatever it costs; but let’s not mistake labels for talent.

Columns, Corporate Life, The Today Paper

Performance Appraisal — Who Needs It?

We go through this ordeal every year when our bosses appraise our performance. Our career progression, bonus and salary depend on it. So we spend sleepless nights agonizing over it.

In addition to the appraisal, we also get our “key performance indicators” or KPIs for next year. These are the commandments we have to live by for the rest of the year. The whole experience of it is so unpleasant that we say to ourselves that life as an employee sucks.

The bosses fare hardly better though. They have to worry about their own appraisals by bigger bosses. On top of that, they have to craft the KPI commandments for us as well — a job pretty darned difficult to delegate. In all likelihood, they say to themselves that their life as a boss sucks!

Given that nobody is thrilled about the performance appraisal exercise, why do we do it? Who needs it?

The objective behind performance appraisal is noble. It strives to reward good performance and punish poor shows — the old carrot and stick management paradigm. This objective is easily met in a small organization without the need for a formal appraisal process. Small business owners know who to keep and who to sack. But in a big corporate body with thousands of employees, how do you design a fair and consistent compensation scheme?

The solution, of course, is to pay a tidy sum to consultants who design appraisal forms and define a uniform process — too uniform, perhaps. Such verbose forms and inflexible processes come with inherent problems. One problem is that the focus shifts from the original objective (carrot and stick) to fairness and consistency (one-size-fits-all). Mind you, most bosses know who to reward and who to admonish. But the HR department wants the bosses to follow a uniform process, thereby increasing everybody’s workload.

Another, more insidious problem with this consultancy driven approach is that it is necessarily geared towards mediocrity. When you design an appraisal process to cater to everybody, the best you can hope to achieve is to improve the average performance level by a bit. Following such a process, the CERN scientist who invented the World Wide Web would have fared badly, for he did not concentrate on his KPIs and wasted all his time thinking about file transfers!

CERN is a place that consistently produces Nobel laureates. (I once found myself with two Nobel laureates in a CERN elevator!) How does it do it? Certainly not by following processes that are designed to make incremental improvements at the average level. The trick is to be a center for excellence which attracts geniuses.

Of course, it is not fair to compare an average organization with CERN. But we have to realize that the verbose forms, which focus on averages and promote mediocrity, are a poor tool for innovation management.

A viable alternative to standardized and regimented appraisal processes is to align employee objectives with those of the organization and leave performance and reward management to bosses. With some luck, this approach may retain fringe geniuses and promote innovation. At the very least, it will alleviate some employee anxiety and sleepless nights.

Columns, Corporate Life, The Today Paper

Handling Goodbyes

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Hold on to your pants, your key staff has just tendered his resignation — your worst nightmare as a manager! Once the dust settles and the panic subsides, you begin to ask yourself, what next?

Staff retention is a major problem in the current job market in Singapore. Our economy is doing well; our job market is red hot. As a result, new job offers are becoming increasingly more irresistible. At some stage, someone you work closely with — be it your staff, your boss or a fellow team member — is going to hand in that dreaded letter to HR. Handling resignations with tact and grace is no longer merely a desirable quality, but an essential corporate skill today.

We do have some general strategies to deal with resignations. The first step is to assess the motivation behind the career choice. Is it money? If so, a counter offer is usually successful. Counter offers (both making them and taking them) are considered ineffective and in poor taste. At least, executive search firms insist that they are. But then, they would say that, wouldn’t they?

If the motivation behind the resignation is the nature of the current or future job and its challenges, a lateral movement or reassignment (possibly combined with a counter offer) can be effective. If everything fails, then it is time to say goodbye — amicably.

It is vitally important to maintain this amicability — a fact often lost on bosses and HR departments. Understandably so because, by the time the counter offer negotiations fail, there is enough rancor on both sides to sour the relationship. Brush those wounded feelings aside and smile through your pain, for your paths may cross again. You may rehire the same person. Or, you may end up working with him/her on the other side. Salvage whatever little you can for the sake of positive networking.

The level of amicability depends on corporate culture. Some organizations are so cordial with deserting employees that they almost encourage desertion. Others treat the traitors as the army used to — with the help of a firing squad.

Both these extremes come with their associated perils. If you are too cordial, your employees may treat your organization as a stepping stone, concentrating on acquiring only transferable skills. On the other extreme, if you develop a reputation for severe exit barriers in an attempt to discourage potential traitors, you may also find it hard to recruit top talent.

The right approach lies somewhere in between, like most good things in life. It is a cultural choice that an organization has to make. But regardless of where the balance is found, resignation is here to stay, and people will change jobs. Change, as the much overused cliche puts it, is the only constant.

Columns, Corporate Life, Humor, Philosophy, Quantitative Finance, The Wilmott Magazine

Money — Love it or Hate it

Whatever its raison-d’etre may be, there is a need for more, and an unquenchable greed. And paradoxically, if you want to try to quench a bit of your greed, the best way to do it is to fan the greed in others. This is why the email scams (you know, the Nigerian banker requesting your help in moving $25 million of unclaimed inheritance, or the Spanish lottery eager to give you 67 million Euros) still hold a fascination for us, even when we know that we will never fall for it.

There is only a thin blurry line between the schemes that thrive on other people’s greed and confidence jobs. If you can come up with a scheme that makes money for others, and stay legal (if not moral), then you will make yourself very rich. We see it most directly in the finance and investment industry, but it is much more widespread than that. We can see that even education, traditionally considered a higher pursuit, is indeed an investment against future earnings. Viewed in that light, you will understand the correlation between the tuition fees at various schools and the salaries their graduates command.

When I started writing this column, I thought I was making up this new field called the Philosophy of Money (which, hopefully, somebody would name after me), but then I read up something on the philosophy of mind by John Searle. It turned out that there was nothing patentable in this idea, nor any cash to be made, sadly. Money comes under the umbrella of objective social realities that are quite unreal. In his exposition of the construction of social reality, Searle points out that when they give us a piece of paper and say that it is legal tender, they are actually constructing money by that statement. It is not a statement about its attribute or characteristics (like “This is a glass of water”) so much as a statement of intentionality that makes something what it is (like “You are my hero”). The difference between my being a hero (perhaps only to my six-year-old) and money being money is that the latter is socially accepted, and it is as objective a reality as any.

I conclude this article with the nagging suspicion that I may not have argued my point well enough. I started it with the premise that money is an unreal meta-thing, and wound up asserting its objective reality. This ambivalence of mine may be a reflection of our collective love-hate relationship with money – perhaps not such a bad way to end this column after all.

Photo by 401(K) 2013

Columns, Corporate Life, Humor, Philosophy, Quantitative Finance, The Wilmott Magazine

Money — Why do We Crave it?

Given that the investment value is also measured and returned in terms of money, we get the notion of compound interest and “putting money to work.” Those who have money demand returns based on the investment risk they are willing to assume. And the role of modern financial system becomes one of balancing this risk-reward equation. Finance professionals focus on the investment value of money to make oodles of it. It not so much that they take your money as deposits, lend it out as loans, and earn the spread. Those simple times are gone for good. The banks make use of the fact that investors demand the highest possible return for the lowest possible risk. Any opportunity to push this risk-reward envelope is a profit potential. When they make money for you, they demand their compensation and you are happy to pay it.

Put it that way, investment sounds like a positive concept, which it is, in our current mode of thinking. We can easily make it a negative thing by portraying the demand for the investment value of money as greed. It then follows that all of us are greedy, and that it is our greed that fuels the insane compensation packages of top-level executives. Greed also fuels fraud – ponzi and pyramid schemes.

Indeed, any kind of strong feeling that you have can be bought and sold for personal gain of others. It may be your genuine sympathy for the Tsunami or earthquake victims, your voyeuristic disgust at the peccadilloes of golf icons or presidents, charitable feeling toward kidney patients of whatever. And the way money is made out of your feelings may not be obvious at all. Watching the news five minutes longer than usual because of a natural disaster may bring extra fortune to the network’s coffers. But of all the human frailties one can make money out of, the easiest is greed, I think. Well, I may be wrong; it may actually be that frailty that engendered the oldest profession. But I would think that the profession based on the lucrative frailty of greed wasn’t all that far behind.

If we want to exploit other people’s greed, the first thing to ask ourselves is this: why do we want money, given that it is a meta-entity? I know, we all need money to live. But I am not talking about the need part. Assuming the need part is taken care of, we still want more of it. Why? Say you are a billionaire. Why would you want another billion? I think the answer lies in something philosophical, something of an existential angst, although those with their billions would the last ones to admit it. The reason behind this deep-rooted need for more is a quest for a validation, or a justification for our existence, and a meaning and purpose for our life. It is all part of that metaphorical holy grail. I know, it sounds a bit nutty, but what else could it be? The Des Cartes of our time would say, “I have loads of money, therefore I am!”

Columns, Corporate Life, Humor, Philosophy, Quantitative Finance, The Wilmott Magazine

The Ultra Rich

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Let’s first take a look at how people make money. Loads of it. Apparently, it is one of the most frequently searched phrases in Google, and the results usually attempt to separate you from your cash rather than help you make more of it.

To be fair, this column won’t give you any get-rich-quick, sure-fire schemes or strategies. What it will tell you is why and how some people make money, and hopefully uncover some new insights. You may be able to put some of these insights to work and make yourself rich – if that’s where you think your happiness lies.

By now, it is clear to most people that they cannot become filthy rich by working for somebody else. In fact, that statement is not quite accurate. CEOs and top executives all work for the shareholders of the companies that employ them, but are filthy rich. At least, some of them are. But, in general, it is true that you cannot make serious money working in a company, statistically speaking.

Working for yourself – if you are very lucky and extremely talented – you may make a bundle. When we hear the word “rich,” the people that come to mind tend to be

  1. entrepreneurs/industrialists/software moguls – like Bill Gates, Richard Branson etc.,
  2. celebrities – actors, writers etc.,
  3. investment professionals – Warren Buffet, for instance, and
  4. fraudsters of the Madoff school.

There is a common thread that runs across all these categories of rich people, and the endeavors that make them their money. It is the notion of scalability. To understand it well, let’s look at why there is a limit to how much money you can make as a professional. Let’s say you are a very successful, highly-skilled professional – say a brain surgeon. You charge $10k a surgery, of which you perform one a day. So you make about $2.5 million a year. Serious money, no doubt. How do you scale it up though? By working twice as long and charging more, may be you can make $5 million or $10 million. But there is a limit you won’t be able to go beyond.

The limit comes about because the fundamental economic transaction involves selling your time. Although your time may be highly-skilled and expensive, you have only 24 hours of it in a day to sell. That is your limit.

Now take the example of, say, John Grisham. He spends his time researching and writing his best-selling books. In that sense, he sells his time as well. But the big difference is that he sells it to many people. And the number of people he sells his product to may have an exponential dependence on its quality and, therefore, the time he spends on it.

We can see a similar pattern in software products like Windows XP, performances by artists, sports events, movies and so on. One performance or accomplishment is sold countless times. With a slight stretch of imagination, we can say that entrepreneurs are also selling their time (that they spend setting up their businesses) multiple times (to customers, clients, passengers etc.) All these money-spinners work hard to develop some kind of exponential volume-dependence on the quality of their products or the time they spend on them. This is the only way to address the scalability issue that comes about due to the paucity of time.

Investment professionals (bankers) do it too. They develop new products and ideas that they can sell to the masses. In addition, they make use of a different aspect of money that we touched upon in an earlier column. You see, money has a transactional value. It plays the role of a medium facilitating economic exchanges. In financial transactions, however, money becomes the entity that is being transacted. Financial systems essentially move money from savings and transforms it into capital. Thus money takes on an investment value, in addition to its intrinsic transactional value. This investment value is the basis of interest.

Life and Death, Philosophy

How to Live Your Life

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I think the whole philosophical school of ethics serves but one purpose — to tell use how to live our lives. Most religions do it too, at some level, and define what morality is. These prescriptions and teachings always bothered me a little. Why should I let anybody else decide for me what is good and what is not? And, by the same token, how can I tell you these things?

Despite such reservations, I decided to write this post on how to live your life — after all, this is my blog, and I can post anything I want. So today, I will talk about how to lead a good life. The first thing to do is to define what “good” is. What do we mean when we call something good? We clearly refer to different attributes by the same word when we apply it to different persons or objects, which is why a good girl is very different from a good lay. One “good” refers to morality while the other, to performance in some sense. When applied to something already nebulous such as life, “good” can mean practically anything. In that sense, defining the word good in the context of life is the same as defining how to lead a good life. Let’s try a few potential definitions of a good life.

Let’s first think of life as a race — a race to amass material wealth because this view enjoys a certain currency in these troubled times that we live in. This view, it must be said, is only a passing fad, no matter how entrenched it looks right now. It was only about fifty years ago that a whole hippie generation rebelled against another entrenched drive for material comforts of the previous generation. In the hazy years that followed, the materialistic view bounced back with a vengeance and took us all hostage. After its culmination in the obscenities of the Madoffs and the Stanfords, and the countless, less harmful parasites of their kind, we are perhaps at the beginning stages of another pendulum swing. This post is perhaps a reflection of this swing.

The trouble with a race-like, competitive or combative view of life is that the victory always seems empty to the victors and bitter to the vanquished. It really is not about winning at all, which is why the Olympian sprinter who busted up his knee halfway through the race hobbled on with his dad’s help (and why it moved those who watched the race). The same reason why we read and quote the Charge of the Light Brigade. It was never about winning. And there is a deep reason behind why a fitting paradigm of life cannot be that a race, which is that life is ultimately an unwinnable race. If the purpose of life is to live a little longer (as evolutionary biology teaches us), we will all fail when we die. With the trials and tribulations of life volleying and thundering all around us, we still ride on, without reasoning why, on to our certain end. Faced with such a complete and inevitable defeat, our life just cannot be about winning.

We might then think that it is some kind of glory that we are or should be after. If a life leads to glory during or after death, it perhaps is (or was) a good life. Glory doesn’t have to be a public, popular glory as that of a politician or a celebrity; it could be a small personal glory, as in the good memories we leave behind in those dear to us.

What will make a life worthy of being remembered? Where does the glory come from? For wherever it is, that is what would make a life a good life. I think the answer lies in the quality with which we do the little things in life. The perfection in big things will then follow. How do you paint a perfect picture? Easy, just be perfect first and then paint anything. And how do you live a perfect life? Easy again. Just be perfect in everything, especially the little things, that you do. For life is nothing but the series of little things that you do now, now and now.

Image By Richard Caton Woodville, Jr. – Transferred from en.wikipedia to Commons by Melesse using CommonsHelper., Public Domain

Philosophy, Science

Free Will — An Illusion?

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If we can let ourselves be amazed at the fact that our non-material ethereal mind can really actuate things in the physical world, we will find ourselves wondering — do we really have free will? If free will is merely a pattern in the electrical activities in our brain, how can such a pattern cause changes and rearrangements in the physical world? Could it be that this pattern is really causing an illusion of free will?

Logic in the form of Occam’s Razor should direct us to the latter possibility. But logic doesn’t apply to many or most of the fundamental hypotheses of life, which answer to a different set of rules. They answer to the mythos, the sum total of the intangible knowledge and wisdom passed down from the past, from the ancient, forgotten masters talking to us through our teachers and folklore, through the structure of our languages and the backdrop of our thoughts, and through the very foundation of our sense of being and consciousness. The mythos tell us that we do have free will, and the logic that came later is powerless to break this notion. So it may be that these words that flow out of my pen into this notepad and later to your computer screen were all predetermined and I had no choice but to write then down. But it certainly is not the way I feel. I do feel as though I can delete any word here. Heck, I can delete the whole post if I want to.

On the side of logic, I will describe an experiment that casts doubt on our notion of free will. From neuroscience, we know that there is a time lag of about half a second between the moment “we” take a decision and the moment we become aware of it. This time lag raises the question of who is taking the decision because, in the absence of our conscious awareness, it is not clear that the decision is really ours. In the experimental setup testing this phenomenon, the subject is hooked up to a computer that records his brain activities (EEG). The subject is then asked make a conscious decision to move either the right hand or the left hand at a time of his choosing. The choice of right or left is also up to the subject. The computer always detects which hand the subject is going to move about half a second before the subject is aware of his own intention. The computer can then order the subject to move that hand — an order that the subject will be unable to disobey. Does the subject have free will in this case?

In fact, I wrote about it in my book, and posted it here some time ago. In that post, I added that free will might be a fabrication of our brain after the real action. In other words, the real action takes place by instinct, and the sense of decision is introduced to our consciousness as an afterthought. Some of my readers pointed out that being unaware of a decision was not the same as having no free will over it. For instance, when you drive, you take a series of decisions without really being aware of them. It doesn’t mean that these decisions are not yours. Good point, but does it really make sense to call a decision yours when you don’t have any control over it, even if you would take the same decision if you did? If something flies into your eyes, you will flinch and close your eyes. Good survival instinct and reflex. But given that you cannot control it, is it a part of your free will?

A more elaborate example comes from hypnotic suggestion. I heard this story from one of the lectures by John Searle — a man was hypnotically instructed to respond to the word “Germany” by crawling on the floor. After the hypnosis session, when the man was lucid and presumably exercising his free will, the trigger word was used in a conversation. The man suddenly says something like, “I just remembered, I need to remodel my house, and these tiles look great. Mind if I take a closer look?” and crawls on the floor. Did he do it of his own volition? To him, yes, but to the rest, now.

So, how do we know for sure that our sense of free will is not an elaborate scam that our brain is perpetrating on “us” (whatever that means!)

Now I am actually pushing the argument a bit further. But think about it, how can the spaceless, massless, material-less entities that are our intentions make real changes in the physical world around us? In writing this post, how can I break the laws of physics in moving things around quite independent of their current state just because I want to?

Is free will an epiphenomenon — something that emerges after-the-fact? A good analogy is that of froth riding on the waves on a beach. The froth may be thinking, “Oh my god, what a tough life! I have to haul all these big waves back and forth. Every day of my life, no break, no vacation!” But that is not what is going on. The waves are just sloshing around, and the froth just happens to emerge. Are our lives just moving along on their own preordained paths, while we, like the epiphenomenal froth, think that we have control and free will?

Philosophy

Mind over Matter

When I want to write something (this blog post, for instance), I pick up my pen and start making these squiggly symbols on my notebook, which I type into the blog later on. Simple, everyday thing, right? But how do I do it? I mean, how do I make a change in the physical, material world of matter by the mere will or intentionality of my non-material mind?

This sounds like a really silly question, I know. When you want to write a blessed post, you just pick up a blessed pen and write the blessed thing (using “bless” the same way Whoopi Goldberg used it in one of her movies). What is so strange or philosophical about it? This is exactly what I would have said a week ago before reading up some stuff on the philosophy of mind.

How exactly do I write? The pen is made up of matter. It doesn’t move on its own volition and make words. We know it from physics. We need a cause. Of course, it is my hand that is moving it, controlled by a set of precise electro-chemical reactions. And what is causing the reactions? The neurons fining in my brain — again, interactions in the material world. And what causes the particular precise patterns of neuronal firing? It is, of course, my mind. My neurons fire in response to the ideas and words in my mind.

Hold on, not so fast there, Skippy! My mind is not a physical entity. The most physical or material statement we can make about the mind or consciousness is that it is a state of the brain — or a pattern of neuronal firings. My intention to write a few words is again a spatial and temporal arrangement of some neurons firing — nothing more. How do such patterns result in changes in the physical, material world?

We don’t find this issue so puzzling because we have been doing forever. So we don’t let ourselves be amazed by it — unless we are a bit crazy. But this problem is very real. Note that if my intention of writing resulted only in my imagination that I am writing, we don’t have a problem. Both the cause (the intention) and the effect (the imagination) are non-material. And this line of thinking does provide a solution to the original problem — just assume that everything is in one’s mind. Nothing is real. Everything is Maya, and only one’s mind exists. This is the abyss of solipsism. As a philosophical stance, this idea is consistent and even practical. I wrote a book loosely based on the notion that nothing is real — and aptly called it The Unreal Universe.

Unfortunately, solipsism is quite wrong. When I say, “Everything is in my mind, nothing else is real,” all you have to say is, “I agree, I hear you!” And boom, I am wrong! For if you agree, there is at least one more mind other than mine.

So solipsism as a solution to the puzzle that the non-material intention in a mind can make physical changes in the world is less than satisfactory. Then the other solution, of course, is to say that intentionality is illusory. Free will doesn’t exist; it is only a figment of our imagination. In other words, I didn’t really intend to write this post, it was all preordained. It is just that after-the-fact, I kind of attribute free will to it and pretend that I meant to do it.

Strange as it may seem, there are some strong indications that this statement may be true. I will write another post (with or without free will) to list them.

The current view in thinking about mind and brain is in an analogy with a digital computer. Mind is a program (software), and brain is the a computer (hardware) on which it runs. It sounds right, and seems to explain quite a bit. After all, a computer can control complex precision-equipment based on programs running on it. But there is a deep philosophical reason why this analogy is totally wrong, but that will be another post.

Corporate Life, Work and Life

Systems and People

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One of my friends found my post on Bill Gates and his philanthropic efforts less than persuasive. He said Bill just couldn’t be a good guy. It may be true, I just have no way of knowing it. I am in a benevolent and optimistic mood in the last few years, so I tend to see the rosy side of things. My friend’s objection was that Gates would squeeze blood out of a stone, if he could, while what he probably meant was that Microsoft was as ruthless a corporation as they came. Therein lies the crux of the problem with our modern era of greed and excess. We see the figureheads standing in front of the soulless corporate entities and attribute the evils of the latter to them. True, the figureheads may not all be innocent of greed and excesses, but the true evil lies in the social structure that came with the mega corporates, which is what I wanted to talk about in this note. What is this “system”?

It is a complex and uneasy topic. And this little analysis of mine is likely to draw flak because it is going to point right back at us. Because we are all part of the system. So let me spell it out right away. It is our greed (yes, yours and mine) that fuels the paychecks of those fat cats at the helm of large companies because they can and do exploit our unreasonable dreams of riches and creature comforts. It is our little unkindnesses and indifferences that snowball into the unstoppable soullessness of giant corporations. We all had our little roles to play, and nobody is innocent. There, I have said it.

Before I accuse you and me of being part of the system (a possibly evil one), I have to clarify what I mean by “the system.” Let’s start with an example. We buy a coffee from Starbucks, for, say five bucks. We know that only a couple of cents of the money we pay will actually go to the farmer in Africa who produced the most important ingredient — the coffee. Now, Starbucks would tell you that it is not just the coffee that they are selling, it is the experience, the location, and of course, high-quality coffee. All true. But where does the rest of the money go? A large part of it will end up in the top executives’ compensation. And why do we find it normal and tolerate it? Of the many reasons, the primary one is simple — we do it because we can afford to. And because we want to feel and show that we can pay five bucks for a cup of coffee. A bit of vanity, a bit of extravagance — some of the vices we don’t like to see in ourselves, but the soulless giants cynically manipulate.

The trouble with the system, as with most things in life, is that it is not all white or black. Look at Starbucks again. Its top brass is likely to be enjoying obscene levels of rewards from our foibles and the remote coffee farmers’ helplessness. But they also employ local kids, pay rent to local landlords, and generally contribute to the local economy. Local benefits at the expense of remote pains and personal failings that we’d rather not see. But the remote pains that we distance ourselves from are real, and we unwittingly add to them.

The system that brings about such inequities is much more pervasive that you can imagine. If you are a banking professional, you might see that at least part of the blame for the coffee farmers’ unhappiness lies with the commodities trading system. But it is not something that stands on its own, with no relation to anything else. When you get your salary through a bank, the money in the account may be used for proprietary trading, resulting in huge profits and price volatilities (in food prices in the third world, for instance). But you prefer to leave it in the bank because of the conveniences of credit/debit cards, automatic bill payments etc., and perhaps for the half a percent interest you get. You certainly don’t want to harm the poor farmers. But does the purity of your intentions absolve you of the hardships caused on your behalf?

The thing is, even you see this involvement of yours, decide to pull all your money out of the bank, and keep it under your mattress, it doesn’t make a goddamn difference. The system is so big that your participation or lack thereof makes no difference at all, which is why it is called a system. I feel that the only way you can make a difference is to use the system to your advantage, and then share the benefits later on. This is why I appreciated Bill Gates’s efforts. Nobody took more advantage of the system than he did, but nobody has more to share either.