Monday, February 25, 2008

Movie Pirates

Last week Toshiba pulled out of the hi-def DVD race and conceded to Sony's Blu-Ray format. But tech analysts, (and I) believe neither format would really have "won" the game in the long run anyway. Physical media storage is quickly disappearing and soon will be a distant memory. MP3's have taken music collections completely digital and, with fiber-optic speeds on the horizon, hard-drive storage prices falling rapidly and Comcast releasing movies "on demand" the same day they release on DVD, it stands to reason that movie collections are next in line to be completely digitized. But the complete digitization of movie collections got me thinking... will online piracy crush Hollywood's revenues as much as it ruined recording industry profits?

That's probably a tougher question to answer than I have time to research, but I believe Hollywood, as a whole, has some intrinsic qualities that put it ahead of the music biz when it comes to piracy. First, music makes no aggressive demands of our precious time and rarely monopolizes our attention, like movies do. Our time in a day is finite, and the movie industry has long been battling for a piece of that time against our jobs, schoolwork, spouses, kids, TV, video-games, internet browsing, books, exercising, recreational outings and social events. It takes a serious investment of time and attention to sit down and watch a two- to three-hour movie. Watching a movie is not an activity that lends itself to long, frequent interruptions; it's an activity that usually needs some planning and requires anywhere from a moderate amount of concentration, to a heavy amount, just to follow the plot and remember the characters.

Music, however, is far less taxing on our concentration or time. MP3's fill in the blank spaces of the day when silence is the only alternative we'd have anyway. Music provides a pleasant distraction from the boredom of a commute to-and-from work (or anywhere else for that matter). It fills in the emptiness when we're working out, and supplements perfectly as background noise for any number of other activities; including nearly all of those mentioned above... working, playing video-games, internet browsing, reading and all types of social activities are often given a soundtrack from an MP3 collection. Listening to a song or MP3 also requires miniscule investment of concentration and, unlike most movies, the demand curve for a previously heard MP3 is very nearly flat... for Economics unititiates, a demand curve slopes down for almost all products. After eating a hotdog, for instance, there is little immediate desire for another one (we've just had one, and now we're full). The same cannot be said for music (listening to a song doesn't mean we don't want to listen to the same one over and over again throughout the day... especially when it's a favorite).

Movies, however, are not so easily re-watchable and their demand curve certainly slopes down. I consider Braveheart to be one of the greatest films ever made, and it's in the Top-5 of my all time favorites, but I don't think I've watched it start-to-finish even once in the past five years. Its three-hour duration requires a big investment of my time, and the fact that I've seen it seven times already severely hampers my desire to sit for another three hours and watch it once again. But if you play Pearl Jam's timeless classic Black, I'm almost always willing to invest five minutes listening to it.

What this adds up to, for Hollywood, is a psychological value movie watchers are much more willing to give to movies. Where that psychological value and the price point intersect (and whether that intersection is at $4.99 or lower) remains to be seen, but even so, there is a value we put on movies above that of a song, and it's for this reason I believe there will be less piracy of movies than music. This is not to say Hollywood shouldn't fear the coming, fiber-optic future, nor ignore the mistakes the recording industry has made. The movie industry should still prepare for the worst -- illegal downloading as widespread and revenue-crushing as it's been for the record companies -- but in the back of their minds, they can take comfort in the fact that I don't think that future will come to pass.

Tuesday, February 19, 2008

In Defense of Steroids (sort of)

The term "steroids and baseball" has, since 2000, become ubiquitous. Roger Clemens has recently joined a long line of baseball players who have either been suspected of, accused of, or admitted to, taking steroids or human growth hormone (HGH). His case, like Barry Bonds', has left sportswriters, the fans and the general public bemoaning the sorry state of baseball and what Bonds’ and Clemens’ usage means to the history and records of the game. With the revelation that Clemens (probably) took steroids we’re facing the fact that not only the greatest hitter in baseball in 50-years (Bonds), but also the greatest pitcher in baseball over the last 50-years, both juiced. Which logically begs the question of whether a home run counts if it was hit off a juiced pitcher? And conversely whether or not a pitcher’s strikeout counts if the hitter was juiced? I can understand how their stats shouldn’t count if they were the only ones cheating, but if everybody was cheating doesn’t it all wash out? And depending on who you listen to, EVERYBODY in baseball was cheating. If you believe some reports, between 1988 and 2004 approximately 100% of MLB players were juicing and Bud Selig was even personally injecting every minor leaguer with a congratulatory shot of Winstrol as soon as they made it to the majors. With such rampant drug usage, all the statistics should either count or everything over the last 20-years should be thrown out completely. But that’s another discussion… for now, what I want to do is try to understand how Clemens and Bonds arrived at the decision to juice and what we should think of them for their decisions. Baseball, and every pro sport in America, is a truly unique career experience. Consider that at any one point in this country there are only 15 major professional sports leagues going (the four major sports, auto racing, boxing, golf, tennis, volleyball and soccer) and that, all told, the combined total population of those leagues is less than 10,000 people. That means 0.000035 percent of the people in this country in any given year earn a living as professional athletes… consider that there are at least 80 companies in this country that employ ten times that many people (100,000) and if you take an even larger cross-section (by breaking careers down by industry) then most of us either work in a company of more than 10,000 people or an industry larger than 10,000 people. Few of us will ever experience the utter uniqueness of a pro sports career, let alone the kind of high-profile, competitive pressures of the life of a professional athlete. And that pure competition and the competitive drive it takes to be a pro athlete can’t be ignored when talking about steroids. No other career choice is so directly competitive, forcing its employees to overcome difficult odds and heated competition against other employees or outside agencies to secure a rather short-lived career. As an example… there may be a feeling amongst the upper management at Best Buy that they'd like to be better than Circuit City, but I doubt the management team at Best Buy will ever be accused of taping Circuit City’s management meetings or stealing their income statements before their 10-k filings (or whatever the equivalent of what Belichick did is). So, even though Best Buy management wants to beat their competition, it's probably not an all-consuming drive and each individual manager’s performance isn’t measured daily against the guys over at Circuit City. To keep following this example, let’s think about the steepness of the success curve of pro athletes. Let’s say there’s a hotshot accounting whiz at Best Buy who rises through the ranks to become the Senior Treasurer for the company at age 29. He performs well for about 6- or 7- years, is at the top of his game and handling the money for Best Buy like nobody else before him. But all of a sudden, as his 40th birthday looms on the horizon, he walks into work one day and realizes his accounting skills are deteriorating… at a rapid rate. So rapid, in fact, that he knows by the time he actually reaches 40 he won’t just be a lousy Senior Treasurer, but he probably won’t be good enough at accounting or finance to handle the budgeting for a single department anywhere within the company. Pro sports accelerate the usual curve of success and it’s obviously a much steeper rise and fall in both directions than any career in the real world. Where most people, in just about any profession, are just hitting their stride in their 30’s and peaking in their 40’s and 50’s, that success occurs about 20-years earlier for athletes. There is pretty extensive psychological evidence out there that we would much prefer the longer, flatter success curve than one with a steep rise and fall, even if the top of the steep rise curve is higher than the flatter curve will ever approach. But this thinking is counterintuitive and we envy athletes for their meteoric rise to success but can’t comprehend how that rise doesn’t cancel out the fall. Studies that followed child stars, lottery winners and others with steep success curves show high levels of depression and difficulty coping with the fall off, DESPITE the fact that they won big early! In fact, it’s been shown that for psychological health, it would be better to take lottery winnings or a job with steadily increasing amounts rather than one with a huge, up-front, one-time payoff. Even if that one-time payoff is significantly larger. Ever wonder why athletes, after signing a huge contract with a front-loaded bonus, start complaining a few years in? Because their pay has been decreasing every year and psychologically that’s not rewarding and the previous earnings successes don’t still resonate two or three years later. The point of this is to try to understand that professional athletes are in an industry where they’re bound to be unhappy as their careers sharply decline. And that’s part of the (small) excuse for Clemens and Bonds.
Now think about how much more depressing that decline must be if everyone around them is accelerating it even faster by taking performance-enhancing drugs. Psychologically that’s a lot to resist and I think we can understand how it might be difficult to reject taking steroids. If Clemens or Bonds, with their millions of dollars and past successes, tried to tell you they were depressed or upset about falling off and really wanted to remain relevant we’d have a tough time believing them. But their usage also might be easier to understand when you consider the general culture surrounding pro sports. Lombardi’s famous quote, “Winning isn’t everything, it’s the only thing” stands as the mantra for all athletes today. We celebrate that phrase constantly and coaches, owners and players espouse similar phrases virtually ad-nauseum. We excuse co-workers for not “giving 110%” every day because people are supposed to have interests outside work (family, hobbies, life). In fact, if you worked alongside a competitive person who gave 110% every day, you’d probably hate the S.O.B. But fans, players, coaches and the sportswriters don’t forgive that same less-than-110% effort in players. A seemingly lazy player, or one more interested in pursuing interests outside his or her sport is often crucified and derided. In such a “win at all costs” environment with such a steep success curve, where a lot of other people are doing what they can to get ahead, is taking performance-enhancing drugs really unexpected or even unforgiveable? Smack in the middle of all that, I’m not sure either Clemens or Bonds thought they were attacking the integrity of the game. Weightlifting, proper diet and exercise and the 8,000 legal supplements available at GNC all provide an edge. Some players put in the work and, despite the obviously positive effects of that (legal) work, some don’t. You think John Kruk ever saw the inside of a gym in his playing days? If Clemens and Bonds are getting an edge over Kruk by working out, dieting and taking supplements, then what’s the difference between taking a steroid or HGH which is just a more powerful supplement? It’s just continuing to add an edge over the guys like Kruk who do nothing besides eat doughnuts anyway. It’s not like it’s “direct” cheating. They’re not stealing signals from the catcher, they’re not holding (if they were NFL lineman) or travelling (like every player in the NBA does). So it’s not a direct “cheat”. But it is illegal in the United States and it does have serious long-term side effects and can damage your health. Steroids can also be abused and as role models for youngsters (and believe me, if you don’t think all this talk of steroids hasn’t increased use by kids in high school and college, you’re crazy) both Bonds and Clemens should have been thinking more about what they were doing. But, at some point in the future, the science behind steroids will eventually create a supplement that offers all the benefits of a steroid (increased strength, energy and recovery) with none of the side-effects. What then? Certainly at that point the general public will have to come to a consensus on what the records and history of the game mean and realize that no comparison can be made across eras… if steroids become safe and legal and a hitter comes along who plays until he’s 50 and hits 1,000 homeruns can we compare him to Bonds and say he was better? Can we compare him to Ruth? Aaron? Of course not. We all understand that baseball players, football players and pro athletes face the intense psychological pressures mentioned above, and that steroids are probably going to be a part of the game for the forseeable future. It’s also easy to see that a ton of players in baseball over the last 15 years have juiced and that records (in ANY sport!) can’t be compared across eras. So why are we so angry at Clemens and Bonds? Well that’s what’s unforgiveable. If they admitted their usage and tried to help us understand the pressures they were under and gave us the reasons for why they did what they did, we’d probably be able to forgive. But when questioned about their (alleged) use, both Bonds and Clemens flatly deny it. They both choose to lie, despite the overwhelming evidence against them (from the resurgence of both their careers when they should have been seriously declining, to the drastic physical changes obvious from just looking at Bonds’ current physique). With that evidence it’s a massive, disrespectful slap in the face to us every time they open their mouths. They're basically calling us all stupid. And that's what's so angering. McGwire avoided doing this to us because he retired and disappeared from the spotlight and refused to grant interviews when the steroid questions directed his way got more pointed. But Bonds and Clemens can’t hide and they’re both fully committed to their lies. And now the public simply wants to catch them at it. Does what they’ve done taint or ruin the game’s history? Without a massive investigation into who was juicing and who wasn’t, that’s an impossible question to answer. Does it change Clemens’ and Bonds’ places in the history of their sport? Again, tough-to-impossible to answer… would either of their careers have declined if everyone else wasn’t juicing? Did their juicing just keep them at the same level as the other players? It’s all impossible to judge. Can we accept what they did given the culture of the sport and the fact they weren’t the only ones doing it? Yes. Can we forgive them both for choosing to take steroids? Maybe. Can we forgive them for thinking we’re all stupid and lying to us about it? Absolutely not.

Friday, February 15, 2008

The World is NOT Flat!

The other day in class, I was burdened with having to watch NYT Bestselling Author, Thomas Friedman give an overly-long and totally pointless speech to a classroom full of MIT business students (you can watch the 45-minute speech if you have nothing else to do here). Friedman wrote a book in 2005 titled The World is Flat and his book went on to win the inaugural Financial Times & Goldman Sachs Business Book of The Year Award (which, as award titles go, is as long and gassy as the book itself). Anyway, after listening to (or suffering through) Friedman’s talk, I wondered how the students at MIT, didn’t have the wherewithal to question any of the crap spewing from Friedman’s mouth? What’s wrong with Friedman’s book and accompanying lecture? Let me count the ways… First, Friedman assembles a variety of cultural, technological, and economic innovations to illustrate how the business world has changed. He lists, among other things, the fall of the Berlin Wall (basically the fall of communism), the rise of the internet, the laying international, underwater fiber-optic cable lines, and shared work-applications all businesses now use (like email, Microsoft Word, Excel etc.) as major drivers of change. He shows how these events allow businesses to communicate more easily, work across the globe more efficiently, outsource work more reliably and work much faster than ever before… to which the only logical response I have is, "Really doctor? Ya think? That’s your professional opinion?" So beyond writing a book about everything that’s painfully obvious to anyone with more than three functioning brain-cells, what else is Friedman’s award-winning book about? Well, from these advances, Friedman then goes on to draw conclusions that aren’t just backwards, but are almost non-sequiters! Friedman thinks these technologies and events are chopping the U.S. down a peg. He feels the world is now flat (because of outsourcing, the ability to communicate around the world so easily, the internet etc.) and that the United States is stumbling and will eventually be replaced as an economic superpower by other countries (or at the very least drawn down to their level and placed on equal footing with the rest of the world). He thinks this will happen very soon. Beyond being an utterly utopian fantasy and incredibly unlikely to happen in our lifetimes, this conclusion is just plain ridiculous. I don’t mean to sound like a gung-ho, U-S-A-chanting patriot who thinks America is perfect… far from it, in fact, as I think there are a lot of things about this country that could be much better… but the world is NOT getting flatter because of technological innovations. If anything it’s getting less flat and America is continuing to rise and distance itself from the rest of the world. By the way, I’m at a loss to come up with an appropriate antonym for "flatter" here… uneven? Bumpier? Hilly? Mountainous? The worst part about Friedman’s conclusions is how plainly influenced they are by his friends and his lifetime of Mid-East studies (he is not a business writer, nor someone with an undergraduate, masters, or PHD in business… he has an undergrad degree in Mediterranean Studies and a masters in Mid-East studies). Interestingly, the main conclusion and driving force for his book came to him during a visit to India, and subsequent conversations with the CEO of an information technology / communications outsourcing company there. This CEO told him the United States was losing ground to India, and the rest of the world economically (Seriously? What else would you expect him to say???) Friedman's book and resulting lecture of a "flat world" therefore draw conclusions that are the end result of irresponsible journalism. As a journalist and writer in a previous profession and now as a business student I find it hard to understand how Friedman could speak to intelligent MBA students at MIT of a "flat" world without doing the proper research to support his conclusions. How could this class of braniacs not laugh him out of the building? How did FT and Goldman Sachs think his book was worthy of an award when, with less than two hours of poking around online, I was able to completely explode his "flat world" hogwash? Personally, I don’t know… but a lot of crap gets published these days so I guess Friedman is no exception. Firstly, let’s attack Friedman’s steaming pile by taking a quick look at the Forbes Global 2000. The Forbes Global 2000 is a list of the largest companies on the planet. A comparison between 2003 and 2007 would be pretty revealing if indeed the U.S. was facing a flattening world would it not? We would certainly expect to see a sharp drop in the U.S. share of those companies over that time period, or at the very least, a stable number. Instead, between 2003 and 2007, the U.S. share of companies in the Global 2000 GREW by 6.1%. How can the world be catching up to us if we’re still adding companies to this list? Okay, maybe some of other countries are growing faster then? At the very least, India should be catching up since that’s where Friedman pulled most of his research. Well, if we look at India’s numbers, we see that they did in fact grow faster than the U.S…. their share of companies in the Global 2000 increased by 10% over the same time frame. Maybe Friedman’s right? Nope. Upon further examination, once again, completely wrong. India’s 10% rise occurred by adding three companies to their previously existing 30. America’s 6.1% rise was the result of adding 45 companies to our previously existing 714! We added more companies to the list (45) in four years than India even HAS on the list (33)!!! How can Friedman possibly be this stupid? Well perhaps he was right about outsourcing and India’s outsourcing industry is a monster on the rise? Another nope. Of the 33 largest companies in India, only five are "outsourcing" companies (ones that take America’s programming, call center work etc.). Of those companies (Infosys, Wipro, Tata Consultancy and Bhati Airtel) none are even in India’s top eight. The other 28 companies on India’s list include fourteen banking institutions, seven oil-gas-utility companies and six material and capital goods companies. Traditional businesses all. After uncovering those statistics in just a few short minutes, I quickly realized that Friedman’s research had been mistaken, so I quickly picked up his book and flipped to the back to search through his list of citations and notes to find out where he’d done his research and gotten his numbers. I quickly realized that Friedman’s research wasn't just "mistaken" but actually "non-existent". Where I expected to find a list of citations I only found two pages of "acknowledgements" graciously thanking a handful of CEO's he’d informally interviewed. What’s perhaps most noteworthy about the CEO’s he mentions is that the first two are the CEO's of Infosys and Wipro (again, who he credits with the source inspiration for his work). So while Friedman may be right about global specialization, that it is in fact, "occurring" and that technological and cultural changes have made it "possible"… he's completely missed the boat as far as the repercussions and end result of specialization. If anything specialization is making the world LESS FLAT! Nassim Taleb in his brilliant bestseller The Black Swan, says it best and I’ll steal directly from his book… "European middlebrows... will often describe Americans as unintellectual, poor in math and not 'into' equation drills. Yet the person making these statements is likely addicted to his iPod, wearing blue jeans and using Microsoft Word to jot down his cultural statements with some Google searches assisting his composition." Taleb goes on to add, "America is more creative... and more tolerant of bottom-up tinkering and undirected trial-and-error. Globalization has allowed the U.S. to specialize in the creative aspect of things, the production of concepts and ideas, that is, the scalable part of business and then assign the work to those happy to be paid by the hour. There is more money in designing a shoe than making it: Nike, Dell and Boeing get paid just for thinking, organizing and leveraging their know-how and ideas while subcontracted factories in developing countries do the grunt work and engineers in cultured and mathematical states do the noncreative technical grind." My quick review of Forbes' Global 2000 only adds to Taleb's point, while simultaneously destroying Friedman's. Friedman's research (or absence thereof) also didn't take into account the downward pressure on wages in India by American companies. After all, we're not outsourcing high-paying, creative jobs! In fact, as India's programmers are starting to demand higher wages for their work, American companies are starting to look elsewhere for their programming and customer service work (mainly Indonesia and the Philippines, but as competition heats up for those hourly-wage jobs they may eventually be shipped elsewhere once Indonesian programmers demand higher wages as well). The final two points Friedman missed are, 1.) never underestimate a society more racially and culturally diverse than any other country in the world, and, 2.) don’t understate the economic significance of America's head-start in business, economy and median household income. First, think about America’s diversity (while we're not as tolerant as I would like, and racism and biases exist in disgusting levels all over this country we're still more racially diverse than any other country in the world)… so, as a quick thought experiment, think about an entrepreneurial start-up company (let's call it Company-X) that wants to break into the widget industry. If Company-X wants to assemble the best and brightest widget experts from around the world (let's say, widget-programmers from India, wireless-widget makers from Norway, widget-microchip experts from Japan, widget-finance experts from Germany and widget-supply chain and management gurus from China) what country would Company-X be "most" likely to found itself? Where would all those determined workers be the most comfortable socially? Certainly not India, Japan or China. More than likely here in the U.S… so again, don't underestimate the diversity of this country and that impact on economics and business. Secondly, how can any country with a median household income markedly below that of the United States' expect to have young entrepreneurs working and tinkering with the newest inventions, gadgets, technologies and business innovations? If most of the people in India and China are still taking pictures with "film" cameras instead of digital ones, most don’t have access to the internet, televisions in every room, 1.2 computers for every household, a cell phone for every child and so forth, how can they be expected to lead a new revolution or come up with the next big idea? Instead, what they can do (and what most countries outside the U.S. have done over the last 100-years) is perfect something America has already created. Nobody doubts Japan, and now South Korea (witness Samsung & Hyundai's precipitous rise) make better cars, TV's, cell phones and gadgets than the U.S. does. But again, what they’ve done is perfect stuff that was created here first. What Friedman's "flattening" technologies have done is allow specialization to occur on a global level. No longer does Apple have to pay inordinate amounts of money to American workers to handle customer service calls concerning the iPod or iPhone. Instead, they can outsource that unprofitable work and go and hire the best and brightest from institutes of higher education (most of which, again, are in the U.S.) to work on the vastly more profitable work of creating the 'next' iPod or iPhone. Will a company in India, Korea or China eventually make a better iPod than Apple? Probably… but by that point, Apple (or another American company) will be hard at work on something else. And that’s the most relevant point of any discussion of specialization and why the world is (in the words of Borat) NOT flat.

Thursday, February 14, 2008

Leadership's Role in Ancient History

Leadership is a big buzzword these days at Business Schools across the country and that's no exception at mine. We were given a couple of books of recommended reading on the subject before classes started, and I found Daniel Goleman's book, Primal Leadership (you can buy here) on the subject very interesting. The research conclusions postulated in the book talk a lot about the sociological impact of leadership positions. Apparently, a leadership position's power (usually granted by a piece of paper via title, or job description etc.) dictates that subordinates will subconsciously react to the emotions, personality and emotional state of the person in that position. These are subconcious reactions much stronger than the ones to their peers, friends or co-workers. An example of this is that when you're in a meeting with your boss, apparently, you're more likely to take visual cues from his/her demeanor and his/her reactions than to anyone else's. You will look to your boss for reinforcement to what you said or to what someone else said. If your boss is in a bad mood and sullen, the meeting will be a sullen one and leave everyone in the room in a bad mood. Frankly, having worked in a few different places, I agree with this statement. I also can see that the business world and world history are both filled with strong leaders who have accomplished great things (both positive and negative). It's this thinking about leadership that led me to question the western (or Euro-centric) determinism Jared Diamond wrote about in his Pulitzer Prize-winning book Guns, Germs & Steel. In the book, Diamond lists all the factors that led to the exact moment in history that Francisco Pizarro and 168 Spaniard soldiers were able to successfully surprise an army of 80,000 Inca warriors, capture their leader and (eventually) enslave and destroy the Incas altogether at the Battle of Cajamarca. Diamond explains exactly how Europeans came to be more advanced than American and South American Indians through a number of factors (all very precisely illustrated). It's a fascinating book and one I highly recommend. All of the factors that led to European nations being capable of conquering the world are ones I understand and agree with. However, there appears to be a key component missing and that's leadership. What I think Diamond may have overlooked is how the Arabic world far exceeded the European nations in wealth, splendor, living standards and science 1,000+ years ago. Arabic scholars had charts, graphs and detailed maps of the heavens, as well as proof the world was round, long before Copernicus. But what happened to the Arabic states that they should fall so far behind the western nations? A crisis of leadership, that's what. Princeton University professor Bernard Lewis wrote a fantastic piece for the Atlantic titled The Roots of Muslim Rage. This piece was written in 1990, long before the first WTC attacks and 9/11. In his article, Lewis mentions the reasons for the decline of the Arabic nations, not the least of which is overconfidence by its rulers (as most global superpowers have at one point or another become overconfident), as well as their complacency and fear of new technology. As Arabic states gradually began to lose more and more battles with the west, be they economic, scientific or military battles, their leadership also began to fail. The final nail in the coffin occurred, as Lewis says, in the 1700s when Arabic leaders had grown so tired of invading western armies setting up camp inside their borders, and grown so tired of Europe asserting itself so forcefully upon the world that they regressed. Lewis shows that Arabic leaders consciously made the decision to revert their societies back to the golden ages of 700-years ago, to a time when they were dominant world-powers. They did this in an attempt to recapture the magic of that time and rise against the west. But, as is obvious to most people (and obvious to Lewis in his article), " does not move forward by going backward." What this leads me to, in a very circular way, is to question the role of leadership in Ancient History. The powerful charisma of a select few (see Hitler) have often impacted life on this planet as dramatically as the geographic, technological and sociological reasons Diamond gives for Europe's dominance. Given the way leadership can influence human history, how could Diamond forget to account for it? Even in pre-history, even 6,000-years ago, when people were just beginning to use stone tools and domesticate horses, there had to be some form of leadership. After all, in EVERY human interaction, there is some form of leadership is there not? Unfortunately history is written by those who won, not by those who lost. So we'll never know what kind of leadership influenced the Inca population and whether or not it was a conservative or liberal society (judging by their ritualistic sacrifices I would guess conservative) but that's beyond the point. The point is that we take into account human interactions in a complex world when writing history and history books recognize the power of leadership (whether granted by title through a piece of paper, or by right of birth, or by the divine powers themselves) in every piece of history covering the last 2000-years. So what I want to know is how can Diamond ignore it completely just because he's talking about history a little older than that?