While the blog was down a very interesting Op-Ed appeared in the New York Times.
A journalist had a discussion with a man who could explain how the financial industry collapsed last year in one sentence.
Intrigued, the journalist pressed the man to explain. The answer? Wall Street got too smart.
In the old days, the Wall Street guys were not the top of their class, they were the jocks and slackers.
But now, all the MIT brainiacs are going to Wall Street.
Huh? If they were so smart how did they mess the whole thing up?
They were too smart.
Briefly, they were so smart they realized they could leverage their assets to make money and they could explain it in a way that made sense to investors.
The article also makes a statement about which industries smart people choose for their careers. For the last couple of decades the smart people have been choosing Wall Street. Working in finance is exciting, fun and can be lucrative. However, it is not productive.
Justice Scalia said the same thing about lawyers. So many lawyers are very bright, and they do help people and they help society, but they are not producing anything. Scalia said:
I mean there’d be a, you know, a defense or public defender from Podunk, you know, and this woman is really brilliant, you know. Why isn’t she out inventing the automobile or, you know, doing something productive for this society?
I mean lawyers, after all, don’t produce anything. They enable other people to produce and to go on with their lives efficiently and in an atmosphere of freedom. That’s important, but it doesn’t put food on the table and there have to be other people who are doing that. And I worry that we are devoting too many of our very best minds to this enterprise.
The point is that for too long, the greatest minds in our country have not pursued industry and instead work in fields that do not have long-term benefit to society.
I discussed the evils of such a system in this post called Yosef and the Economic Light of Wisdom and Kindness.
I agree with the man the jornalist spoke with and I agree with Justice Scalia. We need to somehow get our smart people in industry. When was the last time a U.S. carmaker made a car that really caught your eye or impressed you more than an import? We import clothes, we import technology and we import food.
Instead we should be producing the best cars, the nicest clothes, the greatest technology and the most food. But we are handicapped because our smart people don’t go into those industries.
We need to find a way to fix it.