Nobody Works

79% of employees are disengaged at work, according to Fortune.

I have a theory about this: nobody works.

In my DOGE article, I talked about how nobody in the government works (which is true). Not many people in the private sector work, either. Even successful companies are bogged down in political gamesmanship, and nobody actually does anything. The same can be true for non-profits as well.

If 21% of people work, I would be surprised.

And the crazy thing about this is that the United States has a per capita income of roughly $60,000, almost double the rest of the developed world. We are stupendously rich, and I don’t see too many people busting their asses. I bust my ass, but it is not like I am working continuously throughout the work day. I will do a thing, and after I am done the thing, I will sit and think for 20 minutes, before I do the next thing. Even for me, there is down time.

Imagine where GDP would be if everyone was rowing the boat?

The reality is that all economic progress is made by a tiny minority of people who work very, very hard. So from a policy standpoint, you probably don’t want to get in the way of this tiny minority of people who work very hard. But that is typically what we do, from a tax and regulation perspective. Atlas Shrugged, and all that.

Quick story: I moved to South Carolina in 2010, and got some office space in a big office building. At about 10am, a transformer blew in the parking lot and the building lost power. People went home! At 10am! The power was back on about 90 minutes later, but everyone already left. They got a free day off. I actually sat in the dark for 90 minutes and did miscellaneous shit until the power came back on, and then I went back to work. But I was the only person in the building.

Nobody works.

A lot of companies have what I call an MMM—magic money machine. They have this thing that spits out cash and everyone else can spend their time fucking off. Google is the perfect example. The search business is a magic money machine, it spits out hundreds of billions in cash a year, there are 184,000 employees at Google, only about 500 work on the MMM, and the rest of them spend their time fucking off and have political wars with each other and protesting about the current thing. A lot of them don’t even come in to work. You’ve seen these online videos of the fancy-schmancy food out of the company cafeteria and the gyms and the massages and everything else. There are about 170,000 people who make $300,000 a year who contribute practically nothing to that company. They have jobs because of the magic money machine. This describes most of corporate America. Must of the “work” that is actually done is sending emails from one department to the next. I have a friend who recently left a company that had bitcoin ATMs. The bitcoin ATM business spit out multiple nine figures a year. The business had a little less than a hundred people, who got in fights with each other all the time. The magic money machine did all the work.

Email! The ultimate productivity suck. As a newsletter writer, I get a lot of email. Most of it is one or two sentences. My replies are one or two words. This is the appropriate use of email—to communicate. If you have ever spent time at a university, you know that the faculty love email. They will spend hours crafting 500-word, 1,000-word, even 3,000-word emails to each other to gain political advantage, without fully understanding that nobody actually reads a 3,000-word email. If I get one longer than about 200 words, I don’t respond. This is where the phrase TLDR comes from—Too Long, Didn’t Read. Remember, most books could be a 10,000-word essay. Most 10,000-word essays could be a 1,000 word article. Most 1,000-word articles could be a tweet. Etc. The professors love long emails. They will spend an entire 8-hour day working on a single email. Meanwhile, GDP is circling the drain like a fecal anaconda.

The concept I am referring to here is productivity. Output is how much work you actually crank out. Productivity is how much output you crank out per hour or day. If you want more output, you can work longer, but you can also work more productively. If there is one thing that Elon Musk is good at doing, it is increasing productivity. He gets more work out of fewer people. I’m not exactly sure how he does that. Does he yell at them? Does he threaten to fire them? Does he promise lots of money to people who work hard? A combination of the three? The following two statements are true:

· Left to their own devices, people are not self-starters

· Most organizations don’t expect much of people

So obviously there is some selection bias going on at Elon’s companies: the people who work there know they are going to work hard and know they are going to be rewarded for it. Also, through whatever motivational tools he has at his disposal, he is good at getting lazy people to work harder, or getting rid of the ones who won’t. He is also pretty good at getting rid of cost centers—if you are working in HR, the magic money machine is paying for your salary. Unless you are very efficient at your job, you are going to get shitcanned and there will be more money left over for shareholders. My one piece of advice to college graduates working in finance is this: get yourself in a position where you are generating revenue as fast as you can. In my first year at Lehman, I made $8 million trading. I was being paid $135,000. Lots of other people got laid off, but I didn’t.

Now, I have never been good at motivating people. Not like I have much experience with it. My philosophy is that I can put an incentive structure in place that motivates some people to work hard and others to fuck off, so you reward the people who work hard and fire the ones who don’t. There’s no yelling or cajoling involved, no “transformational leadership” or any other crap, just put the incentive structure in place and people will produce, or they won’t. I do this in the classroom. There are a lot of professors who will lose their shit if their students are on the phone. I could not care less. If you want to be on your phone, you’re going to miss out on what we’re talking about in class, which is definitely going to be on the exam. We’re all adults here. I’m not the schoolmarm telling the fourth graders to put their phones away. If you pay attention and work hard you get an A, and if you don’t, you get an F. The incentive structure is in place. Some professors have a philosophy that it is their job to make sure everyone succeeds. This is codependent behavior. It doesn’t reflect poorly on me if everyone in the class gets an F. The process works. In my classes, there is something approaching a normal distribution in grades. You have some high achievers, some people in the middle, and the people at the bottom—just like life. I tell my classes I have no problem giving everyone an A if they earn it—but it never works out that way, human nature being what it is.

In my experience, the reason a lot of people don’t work is, well, maybe because they are lazy, but also because of poorly designed incentive structures. If you have someone doing X and they are making $100,000 a year, and if you tell them that if they do X + 50% they are going to make $150,000 a year, many of them will rise to the challenge. There are, of course, some people who will be content making $100,000 a year, which is also information. But the +50% has to be quantifiable and measurable. I started getting a little disillusioned on Wall Street when my P&L was up 20% or 30% and my compensation was up 0%. And the last thing you want is for people to be cynical about their jobs. You want people to be idealistic about their jobs. You want them to believe that they are doing good in the world, you want them to understand the mission, and you want them to leave it all out on the field. There was a management article from about 30 years ago called “It’s the Incentives, Stupid!” that made the rounds back then. Was absolutely true. You want to be able to tell someone, if you do X, and we all do X, and we succeed, then you are going to get rich. And then they actually get rich. That was Wall Street in the 90s and 2000s, basically. And Amazon and Microsoft and Tesla. You don’t have too many disgruntled employees writing tell-all books when the stock is going up.

But outside of a few highly-motivated people at big tech companies and banks, nobody works. Now, I know what’s going to happen in the comments—people are going to say, well, teachers work. Doctors work. EMTs work. All true. Teaching especially—I teach one two-and-a-half hour class once a week and I am physically wrecked afterwards. I don’t know how these people even just stay on their feet all day. But in large organizations, big dumb organizations, whether in the private sector or the public sector, it is possible to fly under the radar. We are spending a lot of brainspace on efficiency these days. These are good, but uncomfortable conversations to have. Our economic superiority will be challenged one day.