Systems of Survival

Timothy B. Lee reads and comments on Jane Jacobs’ excellent, enigmatic, thought-provoking book.

There are two basic strategies for survival: taking and trading. That is, we can forcibly take what we need from other people, or we can trade what we have (including our labor) for things we need. Jacobs argues that each of the two strategies for survival has a corresponding “moral syndrome”—a cluster of related values that define virtuous behavior for people who survive in that fashion. Those who live by taking tend to observe what Jacobs call the “guardian syndrome,” which values loyalty and obedience and shuns trading. Those who live by trading observe what Jacobs calls the “commerce syndrome,” which values inventiveness and hard work and shuns force…

Jacobs argues that society needs both syndromes because it needs both a government and a private sector. The values of the guardian syndrome—loyalty, obedience, and respect for hierarchy—are best suited for those who hold power over others. On the other hand, the values of the commercial syndrome—be innovative and industrious, deal with others honestly and peacefully—are essential for wealth creation in the private sector….

Jacobs calls combinations of the two syndromes—and the institutions that operate on such hybrid moral systems—”monstrous hybrids.” Freddie Mac and Fannie Mae were a famous example of a monstrous hybrid. They were for-profit companies that had a special relationship with the federal government that caused the market to assume (correctly, as it turned out) that their debts were implicitly guaranteed by taxpayers. The companies’ desire to make money for their shareholders pushed them to expand rapidly and make what turned out to be reckless bets. And their status as private companies made it difficult for elected officials to exercise the kind of oversight that ordinary government agencies receive.