A Perfect Meme

Every day we run The Narrative Machine on the past 24 hours of financial media to generate a list of the most linguistically-connected and narrative-central individual stories. We call this The Zeitgeist and we use it for inspiration or insight into short-form notes that we publish a couple of times a week to the website. To receive a free full-text email of The Zeitgeist whenever we publish to the website, please sign up here. You’ll get two or three of these emails every week, and your email will not be shared with anyone. Ever.

As you might have noticed, we’ve taken a brief hiatus on Zeitgeist notes here at the end of 2019 – a short period both Ben and I have spent with our families and planning for an exciting 2020 here at Epsilon Theory.

But sometimes an article that rises to the top of our queries is just too good to pass up, even when we’re on vacation.

First there was ‘diversity.’ Then ‘inclusion.’ Now H.R. wants everyone to feel like they ‘belong.’ [Washington Post]

We don’t spend all that much time talking about ‘political correctness’ or the more conservative variants we occasionally refer to as ‘patriotic correctness’. Some readers find that surprising – or irritating, wishing we would lay into some of this nonsense a bit more often. It is true, these moving target norm enforcement rackets sit at the target rich center of the overlapping Venn diagram of paternalistic Nudging, highly abstracted language, and Missionary behaviors meant to establish new Common Knowledgewhat everyone thinks everyone thinks our cultural norms are.

It’s not that we don’t see it. It’s just that it’s…been done. Honestly, if the headline alone – much less reading each ever more excruciating word of this Washington Post ‘Analysis’ – wasn’t exhausting to you, there isn’t anything I can write that will change that.

Still, it is interesting that an article like this was among the most connected by language to financial markets news over the last couple days. More detailed examination shows that connection to be the result of a general increase in ESG language showing up throughout financial news. The behavior of executives, the demographic composition of C-suite and boards and the hiring behaviors in the tech industry in particular are all becoming more common in standalone articles and as frames for articles nominally about other topics. It’s part of the Zeitgeist – for now.

And, no, Yay, diversity! – a vastly different thing from the actual pursuit of or belief in the benefits or rightness of diversity – is not new. For years, it has been a banner-waving Meme embraced by every Fortune 500 HR department and MBA program across the country so that they wouldn’t have to, y’know, actually undertake the hard work necessary to rid themselves of the self-defeating monocultures of skills, temperament and demographics they’ve so painstakingly created over the decades. If you think the Patagonia Parade is the natural output of a properly functioning meritocratic system or exercise in maximizing aggregate company productivity, I’ve got some energy PE investments those bevested young men are hard at work right now fitting into a 1.2x Q4 mark that I think you’re just going to LOVE. But merging diversity and inclusion language on the one hand, and the workism dogma of belonging, family and community on the other?

Yay, belonging! is a powerful meme. A perfect meme.

It is also deeply cynical.

We have already said our piece on workism, the meme-laden exploitation by employers of our desire to imbue our work with meaning, which forms half of this new idea.

So what is the rest of this new idea?

I mean, it’s all good-sounding stuff, of course. This kind of thing always is, and one does get the impression that people like this are well-meaning. But what does it mean in practice?

It means that if you resist all that nonsense about seeing your employer as your family, you are now guilty of an infraction against inclusion, too. It means that employers will change the dimensions they measure from things they can control (e.g. whether they hire people whose intellect, skills, race, ethnicity, temperament, value system, religion, socioeconomic background, regional background, nationality, gender, sex, etc. may make their company’s ideas and execution more robust) to things they can’t. And THAT means that executives and boards will now have more firepower to arbitrarily claim that they did all they could but couldn’t achieve results due to factors outside of their control – or better yet, to change the subjective standards by which success on this dimension is defined.

That way we don’t have to do anything that matters, and everyone still gets to wave the yay, belonging! flag.

When clear, simple ideas don’t work perfectly – like, say, the embrace of a simple idea like diversity – we have three choices: we can accept their imperfections, we can add more complexity to the ideas to accommodate their flaws, or we can create abstractions which cloud the areas that worked and didn’t work in a fog of linguistic uncertainty.

As a rule, favor the first, selectively apply the second, and avoid the third like the damned plague.


  1. How long can “belonging” be propped up once a round of layoffs come?

    “Exhausted” reading the article - God yes, but it’s also a sign of defeat without the willingness to give up. When your idea has failed, but you won’t give up - rename it / repackage it. To wit, see “liberals” becoming “progressives” over the past three decades; my guess, in another few decades, they’ll become liberals again or they’ll try some new term.

    Ben wrote early in ET (in “The Play’s the Thing” https://www.epsilontheory.com/the-plays-the-thing/) about small t’s versus real Truths and small h’s versus real Honesty. All these things - “diversity,” “inclusion” and, now (I guess we’ll have to endure a cycle of), “belonging” have small t’s and h’s, which keep them alive, but the bigger truth of, as you note, meritocracy won’t give up / won’t be defeated because it is the bigger truth that corporations really want…and need (less sure about governments and not-for-profits).

    And you can feel the machine gearing up to sell “belonging.” It’s all coming: the seminars, tutorials, offsites, being embedded in the company’s “values” and your PDPs, etc. Life really is exhausting and more so when the small t’s and h’s try to tackle the big ones.

  2. I “retired” yesterday. No longer have to deal with HR issues. As HR & compliance became more prevalent in the investment industry I could feel the dynamism drain away. Unfortunately my kids have to deal with diversity. My younger boy is a white male Masters of Economics. He was interviewed and short listed for the Bank of Canada. Did he have a chance? No. He is white & male. His avocation is sketch comedy, if you think HR departments are laser focused on diversity, try the arts community.

  3. Belonging, etc. more corporate culture hog wash. These are simply craven attempts to become “ESG” certified so as to be included in some ESG based ETF…opening up yet another venue to drive the stock price higher. C-suites obsess about their brands and community involvement contribution in public, but gut their companies and cultures by extension in private, with “do gooder” smiles on their faces. Yay! All the while they use this misdirection to enrich themselves while everyone feels good (er no one is looking).

  4. My fund manager meetings used to start with “you can put those performance charts away” but now it’s “if anyone mentions ESG there will be trouble”. Most managers can’t get past “G” let alone “E” and they haven’t a clue about”S”.
    As Rusty suggested some moons ago just ask them how they make money, sit back and see what comes up.

  5. Oh, you’ll love this one from today’s WSJ, “Bond Gurus…”. Note the comment by Vanguard group CIO where he give ZERO insight re bond markets (purpose of interview) and talks only his book about ETFs and hiring financial professionals. Like eating angel food cake…looks sooo good until you realize ain’t nothin’ but air.

  6. Avatar for Zenzei Zenzei says:

    Hmm. Personally, I like the idea of contributing my time and energy towards moving forward the objectives of a team that I respect. One where I feel I belong. One that has a sense of community. One that is like, you know, a pack. I am sure most here would agree with that sentiment.

    I liked the way you summarized in your last two PP, the tension between talking about building a community vs. doing the actual hard work of building a community - and the pitfalls of falling into the abstraction trap. (In fact, I’m currently down a rabbit hole of thinking about all the ways in which abstractions and memes stem out of that conflict).

    And while I too have a healthy dose of skepticism about how many of these actors are doing it solely from a perspective of “yay, ESG!”…the struggle is real and there are many folks in fields like, say Education, that are struggling to build workplaces that model good community values. Maybe it’s our foolish belief in the words of the immortal James Baldwin…

    ———— “Children have never been very good at listening to their elders, but they have never failed to imitate them.”

  7. I agree with a lot of your points, but I disagree with the point about what corporations want. Corporations aren’t people. They don’t want anything. The people working in and for a corporation want a lot of things. Some of those things align with the Corporation’s leadership team goals and a lot of them don’t. When I read the article and Rusty’s commentary on it, I did not get the impression that Corporate Leadership wants diversity. They certainly don’t want a meritocracy. They want to signal that they care about these things, without doing anything to make them happen. Think about it, if a corporation actually wanted diversity, inclusion, and meritocracy would the Board of Directors be primarily a bunch of white people with personal connections to the other board members. That’s not meritocracy, that personnel oligopoly. Meritocracy means competition. It means putting your skills, ideas, and livelihood into the arena and letting them run the gauntlet. It means subjecting them to review, criticism and potential defeat. I have yet to meet the business leader that is willing to do that on a fair and level field. Actions revel more than talk. The actions and the results show that corporations don’t want diversity, inclusion, or belonging. If they did, they would already have it. They want to “wave the flag” and say that they support these things without doing anything that would put their position and livelihood at risk.

  8. Thank you for responding. I read your comments several times and thought about them before writing the below.

    My experience in the field of finance over thirty years (twenty plus in management roles) is that Corporate America (to your point, the leadership team), overall, just wants the best person in the job and has made a sincere effort to widen its pool of candidates to increase diversity (and supported many special programs internally and externally to help the careers of POC and women). To be sure, there are individual actors who don’t follow this - and, often, the company tries so hard to show its diversity bonafides that it unfairly advantages women and minorities (more than once, I was told by HR not to fire a POC or woman on my team when we had a forced layoff, which left only the white men to let go).

    We could go on and on as to why, for example, more men than women end up in senior roles, but as a mid-level manager, I had scores of talented women quit over the years to become stay-at-home moms, but not once did a man ever quit for that reason. And, yes, most of the banks/asset management firms - at various times - had flex programs, work from home, etc., options, but again, no man ever quit to stay at home and take care of their children, but many women did.

    I read Rusty’s note as implying that corporations try for meritocracy, but I could be wrong about what he was saying, but I believe their overall goal is to get the best person in the slot at the least pay - and they’d be very happy (and would have been over the last twenty-plus years) if that person was a POC or woman. I’ve had offer letters ready to go out to white men where we’ve kept the position open longer (sometime so long that we lost the candidate we were ready to hire) to try to find “an equally qualified POC or woman” to fill the role - which, implies, the white man loses every tie (but don’t say that to HR).

    That’s been my experience over a pretty long career at several different (and large household name) organizations. To your point about the top of the house, the little window I’ve had into that world is that it is brutally cutthroat where everybody looks out for themselves. But other than seeing some of it, I’ve not been close enough to say if there is some “gentleman’s agreement” or not. However, just below that level, my experience, as noted, has been that corporations (banks/asset managers where I’ve worked) have been for many years and are making a sincere effort to get the best person in a slot and to try (and, often, bend over backwards) to find and give the edge to a POC or woman.

    Maybe my career is too small a sample to generalize, but that is exactly what I experienced in those three decades.

  9. Avatar for Zenzei Zenzei says:

    Does some corporate leadership behave that way? Undoubtedly. Does all corporate leadership behave that way? Unlikely.

    If we focus away from the “yay, diversity/belonging/inclusion” meme and focus instead on the reality of what it means to run a functionally diverse organization we reach the root of the problem very quickly - what exactly is the meaning of “diverse”?

    In my experience, the meme side of diversity generally reduces to “diversity of appearance” as in “we don’t want a lot of people that look the same way”, the functional side of diversity generally reduces to “diversity of thought” as in “we don’t want a lot of people that think the same way”.

    Given how hard it is on a personal basis to keep one’s own thinking diverse (commitment and consistency bias, availability bias, confirmation bias)…it is not hard to understand why creating a functionally diverse organization is hard.

    As I stated in an earlier comment, I do think the struggle is real and one that is worth engaging on, because our future will depend on diversity of thought and our ability to develop a world where most people feel they belong in one way or another.

  10. Mark, Thank you for thinking about my comments and responding. I don’t want to put words into anyone’s mouth or accuse any individual of bad acts or intentions. My comments were oversimplified and perhaps used too many stereotypes. The following is a little off the topic, but hopefully builds out a bigger conversation.

    My goal is to try and raise the conversation to look at why things are they way they are and what will it take to change them. I’m looking to have an intelligent, thought out discussion. I’m a small “l” libertarian, and I don’t believe that government is the problem. Bad government is a problem. Corrupt government is a problem. Government, in general, is necessary to create a stable and prosperous environment. The same goes for Corporate Leadership. I’m paraphrasing, but it has been said that the role of Governance is to determine whose ox gets gored. The role of corporate leadership is to determine how the resources of the company get deployed. There was a time when companies were considered to have 3 stakeholders: Shareholders (ownership), Employees, and Communities. It has changed over time to only one stakeholder: Shareholders. (I don’t think Corporate Leadership is meeting their fiduciary responsibility to that stakeholder. Just read some of the other articles, like “This is Water”) I don’t “blame” corporate boards or the government or any individual. I blame the system and the society. We created this issue. We allowed this to occur. We saw problems and did nothing to address them. I don’t know why it happened, but I suspect that part of it was because we thought letting it happen would not only protect our oxen but help us expand our personal herd.

    I may be swimming in confirmation bias, but I believe the core tenants of Epsilon Theory. Make, Protect, Teach. Individuals cooperating yield better long term outcomes for the individual and the tribe than direct competition. We are not communists. Explicit rules, rigidly enforced, generate more freedom than vague rules with discretionary enforcement.

    As long as the playing field is level in every way, I don’t mind losing the coin flip. The playing field is not level. It has never been level. In order for it to become level, the white man is going to have to lose on some of the close calls. I’m a white man. I’m o.k. with that. It means that I need to continue to build my skills, never stop learning, continue to grow. If I know that I’m going to lose in a tie, I need to work hard to ensure that it’s not a tie. It’s not about Diversity, or Inclusion, or Belonging, it’s about striving to make this world a better place for all of the inhabitants. Sometimes, that means that we need to sacrifice one of our oxen to help a neighbor.

Continue the discussion at the Epsilon Theory Forum

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