Fort hose who dread such posts, this is yet another one of those essays where I take a seemingly unrelated aspect of my job and draw from it a host of economic and political conclusions.But, if it makes any difference, this one does at least admit I might have been wrong in a past essay, to a degree anyway, and is founded on my own bad habits, so maybe that will make it a bit more palatable.

In my essay ""Best Practices"" (as well as "More Examples From Another Field", "Object Oriented Programming, Apple Computers and Justice", "Some Libertarian Analogies" and "Copyright as Politics"), I was, I think rightly, critical of many "best practices" established in the computer industry, as there is a disturbing tendency for either academics to establish such standards in isolation, without thought of real world consequences¹, or for industry firms to establish them, based upon the assumption that the conditions faced by all firms are similar to those faced by their own. In both cases, we tend to end up with inflexible rules which are ill suited for many circumstances, but which both managers without strong tech backgrounds, and tech experts with too much respect for academe, try to force upon systems regardless of the consequences. (Not to mention certifying bodies and government contracts often requiring such standards be met, even when they are perfectly nonsensical in a given context².)

On the other hand, from time to time, "best practices" is applied to something actually useful, either a rigid set of rules which have been extensively tested and found to produce optimal outcomes with no negatives (a rare circumstance), or else is applied to a range of suggestions, even suggestions tied to outcomes. In those cases, despite my earlier criticisms, "best practices" can be useful.

I mention this because, from time to time, someone will point out that one of the machines or processes for which I am responsible, is not using that sort of best practice. My initial inclination is to dismiss such complaints by pointing out that the process works, and thus making a change is a risky undertaking, but I have learned to stifle such impulses. Unless the "best practice" in question is one we have already examined and dismissed, I have taught myself to listen to such suggestions and give them fair considerations. I admit, I still tend to follow up on only a small minority, as the fact that present settings are working is a strong counter argument, but I do listen.

I mention all of this because my innate reaction is a very common human response, and one which receives far too little attention in politics and economics. Or, to be accurate, receives a fair amount of attention, but usually in the wrong contexts. It is a tendency best described as "resistance to change", and, though I am about to argue that it can be harmful, it is also quite beneficial. And if that sounds contradictory, recall that all medicines are also poisons, given the right dose. Likewise, resistance to change is, in general, a positive trait, but taken to extremes, it can be destructive.

Allow me to explain.

As I have argued in "Traffic Lights, Predictability and Conservatism", "Humor and Nightmare", "In Praise of Slow Changes" as well as "In Defense of Standards", there are several good reasons to resist making dramatic, sudden changes. First, because predictability is quite important to society, and making sudden changes gives little time for word to spread, meaning such changes will come unexpectedly to many, making them insecure and uncertain, and generally destroying that confidence in the stability of society which is so important,  especially in the context of long term planning. ("Predictability" , "Inflation and Uncertainty") In addition, changes have consequences, and making grand, sweeping changes tends to introduce more consequences than making many small changes. This means any negative consequences are likely to do much more harm, and, more importantly, it makes it much harder to know which particular change brought about which particular consequence, making repairs harder, or even impossible³. Finally, our traditions have come down to use from many, many generations in the past. Not every one of our ancestors was a genius, but they were not entirely fools either.  That means the standards we now have are the best choices available as judged by hundreds of thousands, or millions, of minds over dozens or hundreds of years. Before we dispense with all that experience, we should make sure the replacement truly is an improvement.

Which hopefully explains why resistance to change is a beneficial trait. Despite the modern tendency to foolishly conflate "new" and "improved" ("Juvenile Intellectuals", "O Tempora! O Mores!, or, The High Cost of Supposed Freedom", "Something of a Paradox"), the truth is a novelty is as likely to be in error as a tradition, perhaps more so. Of course, seeing as we do, mostly the novelties which have survived the test of time, as well as forgetting the failed novelties such as pet rocks, Yahoo Serious, "Cop Rock", Furbies and Tiffany (the singer, not the jeweler)⁴, we imagine all improvement, or at least most, is good. What we fail to realize is that most novelties don't make it very far. Many, many bad ideas are born every day, but most don't get beyond a small circle of friends, at most maybe a neighborhood or town. In a few cases, maybe a foolish craze will sweep a city or state. But, for the most part, our natural resistance to change keeps bad ideas from gaining much headway, and so we mistakenly think most novel ideas are good⁵.

This resistance to change is at the root of many behaviors, some of which have been recognized by economists and political theorists. For example, the tendency for politics to swing from one extreme to the other is largely an embodiment of resistance to change. As the drift goes too far in one direction, it leaves the "comfort zone" of familiar beliefs and ideas, and so the opposite position gains ascendancy for a time. Likewise, the lag seen in prices is largely the result of resistance to change. Most people, seeing a fluctuation in the market, be it in stocks or the price of goods, tend to assume it is a "blip" and do not react, it is only when the change is sustained for some time that the rest of the market reacts, which is why we tend to see short movements of prices followed by big leaps, as everyone "jumps on the bandwagon". And that reaction makes sense. True, one could get rich by reacting sooner, but in many cases, small movements are transitory, and reacting to them would be detrimental. Thus, moving with the crowd, while it reduces one's overall returns, provides an even greater reduction of risk.

One other expression of resistance to change, and the reason I wrote this essay, is the bureaucratic tendency I described elsewhere as "fear driven" behavior. ("The Bureaucratic Mind", "Bureaucratic Management", "The Inevitability of Bureaucratic Management in Government Enterprises", "Organizations as Filters", "Bureaucracy and Arbitrary Power", "Somewhat Off-Topic Rants", "Bureaucracy Revisited", "How the Government Corrupts Relationships", "Bureaucratic Management and Self-Policing", "Inflexibility and Bureaucracy", "In The Most Favorable Light", "With Good Intentions", "Grow or Die, The Inevitable Expansion of Everything", "Fear Driven Enterprises", "Adaptability and Government", "The Wrong Solution to Bureaucracy")As I described in several essays, bureaucrats tend to advance, not through "making a name", but through serving time and avoiding scandal. The easiest way to do that is to simply follow tried and true patterns of behavior, which make sit quite natural for them to have a strong resistance to change. As following the rules is almost always a valid excuse, and a sure fire way to avoid blame, there is little to be gained from breaking with established practices. Even trying to get the rules changed is somewhat dangerous, as any consequences are likely to carry far more danger than any possible benefit one could enjoy. And so, whatever else they may be, bureaucratic organizations tend to become living embodiments of resistance to change⁶.

Which brings me to the second half of my point, that resistance to change, while beneficial, can also be damaging.

As I said above, resistance to change makes sense, we should treat changes to established practices with skepticism. Not every novelty is good, and most established procedures exist for a reason, so it follows that we should take a long look at any innovations before implementing them. However, we SHOULD take a look, and, if they prove beneficial, we SHOULD consider implementing them.

That is where resistance to change can become damaging. It is easy to use resistance to change to justify simply ignoring any innovation and continuing along in the same course for all time. If one finds the novel suspect, it is easier to simply ignore any changes rather than evaluate each. And, given the specific environment of the bureaucratic organization, it is easiest of all there. After all, as I said earlier, the benefits of championing a change are small, if any, while the risk if one creates a problem is tremendous, so why not just let things continue in the same way forever? And thus, especially in bureaucratic enterprises, but even in other human endeavors, it is very easy for resistance to change to turn into stagnation.

Which is where the free market comes into this. In the free market, in a profit driven enterprise, there is still resistance to change. If one's firm is doing well, making money, running smoothly, one is tempted to simply leave it alone. Just as in a bureaucracy, the risk is great, and the reward likely smaller, and so it is very tempting to simply let things continue as they are⁷.

But the free market has two means to force innovation, to ensure that resistance to change does not become overwhelming, though, in a way, they are both simply aspects of the same things.

First, within a given firm, it is easy for a given division, operating well, to rest on its laurels. There may be some impetus to innovate if one has ambitions of holding a higher position, but, as we have established, the risk of failure may be greater than the benefit of success, so it is a risky game to try to innovate to gain promotions. Office politics is a surer route.

That is, were it not for outside firms.

If I am in charge of the wheel division of a large auto manufacturer, I must always be aware that there are private businesses out there making "aftermarket" wheels, and, should the wholesale price of aftermarket wheels fall low enough, it may make sense for my firm to simply buy those wheels from a third party. Or, if they would find such a thought unacceptable, buy out a third party and adopt their business practices. In either case, I am inspired to innovate, despite the risks, in order to keep my job. If I rest on my laurels, and the market moves ahead of me, I could find myself out of work. Granted, I will likely make conservative changes, while small, new firms will take larger, more risky paths, but most of those will fail, while I will probably succeed, and, in the future, can adopt the new, risky alternatives after they are established and tested, at least the ones that work.

And that leads to the second pressure overcoming resistance to change, which is almost the same. If my division is in competition with outside firms, so is our entire company. And not just with those making the same product, but also with those making products which can be substituted. Cars compete not just with cars, but trucks, vans, motorcycles, bicycles, public transportation and others, to one degree or another. With all of these competitors out there, it is impossible to avoid all change, at least if one wants remain in business. It is most obvious in the case of companies which reject customer demands, but ignoring any possible improvement is risky in a competitive market.

I mention all of this for one simple reason. In "The Inevitability of Bureaucratic Management in Government Enterprises" I discussed the fact that any firm with sufficient government involvement would behave in the same way as a bureaucracy, whether or not it was formally organized as one. Given that bureaucracies are likely to become embodiments of inertia, it follows that government interference in businesses will act as a brake upon any change or innovation. And, as result, the more the government interferes, the more our economy stagnates. And no amount of "stimulus", no amount of inflationary cheap money will change that. Bureaucracy brings stagnation and government brings bureaucracy. Until we recognize that, we are at terrible risk of bankrupting our nation while trying to regulate it into prosperity.

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1. I almost wrote an essay on a related issue, one more akin to my post "Absolute Values". Today, while talking to my mother about buying a generator for the house we share, we were discussing the relative advantages and costs of the ones which provide a few outlets, and the ones which hook into the home wiring. She had read somewhere that the more expensive models "were not worth the cost" unless you expected frequent power outages. As any regular reader must anticipate, this started me into a tedious explanation of the fact that "not worth the cost" is a value judgment, and if I though lacking power for even 8 hours was worth the price, then it was. And similar conditions often arise in academic standards, especially in security. An expert will say some convenience is "not worth the security risk", forgetting that the market, or a give environment, may disagree, based either upon the urgency of that convenience, or the low value placed upon security in the specific environment.

2. At one job I was tasked with researching the requirements for CMM level 5 certification, and that standard deserves its own post, or maybe series. It embodies everything bureaucratic and absurd in both government and economics. First, it assumes computer programming is "repeatable", which seems absurd when doing innovative or creative work (as opposed to other tasks which involve pasting together prefab components), and also seems to think repeatability and consistency is ensured by layering endless committee meetings on top of an already bloated process. It is probably why only government contractors seem to receive this certification. It is suited only to the endless government development cycle, but would be suicide in an even mildly competitive marketplace. I have been critical of ISO 9001, repeating often the jest that you could get certification for a process to make cement life vests, so long as you documented it well, and I still stand by that statement, but at least ISO 9001 centers only on documenting the process, it does not bloat the process like, or if it does, does not do it to anywhere near the degree of, CMM.

3. This is one of the reasons that grandiose government programs tend to follow one upon the other. ("The Endless Cycle of Intervention", "The Cycle of Compassion", "Recipe For Disaster") The consequences of the first program generally cannot be corrected by small changes, and no one is about to rescind an entitlement, so we end up with a new program to fix the problems caused by the first. For instance, when paying single mothers to support their children caused growth in illegitimate children, we had to introduce housing and medical assistance for the growing number of impoverished children. And then, when having a child became an easy way to get out of the house without getting a job, we had to introduce programs to discourage teen pregnancy. It is but one example, there are dozens, some of which are discussed in "Perverse Incentives" and "When Help Hurts".

4. Even things that once seemed to succeed and establish themselves can quickly vanish. When was the last time you raced out to find a Jolt Cola? Or an Orangina? Or a Zima? All three had their day in the sun, when stores could not stock enough, but today all three are simply just another brand, and not even very noteworthy ones. (Actually, I don't know if Jolt still exists. I know Orangina does, as I am one of the few remaining fans. Zima was on liquor store shelves back in the late 90's, but beyond that I cannot say, so I am just assuming all three still exist.) However, for a time, even after their moment of trendiness, these products remained popular and well established, and would have seemed to contemporaries to have become part of our culture. All of which shows how hard it can be to tell which innovations will really survive the test of time and find general acceptance.

5. Unfortunately, as come to equate novelty and beneficial more and more, making of novelty a value judgment, more and more abd ideas will gain ever wider circulation. Hopefully, this will disabuse us of the idiotic notion that new is good, but given our current cultural trends, I am not hopeful. ( "Cranky Old Man?", "Faux "Maturity"", "Catastrophic Thinking, The Political, Economic and Social Impact of Seeing History in the Superlative", "Pushing the Envelope", "I Blame the Romantics", "The Adoration of Youth", "In Defense of Standards", "Addenda to "In Defense of Standards"", "Deadly Cynicism", "Juvenile Intellectuals", "Trophy Spouses", "O Tempora! O Mores!, or, The High Cost of Supposed Freedom", "Self-Serving Cynicism and Our Cultural Immaturity") Perhaps, eventually we will come to our senses, but I worry that it will take too long and the harm will be rather extensive.

6. If you doubt this, ask anyone who worked in government when they discontinued the use of carbon paper. Or when they even introduced personal computers as opposed to mainframe terminals. Having worked in the government, I can say there are exceptions, a few divisions, especially in the military, which kept up with private enterprise, but for the most part the government has lagged well behind the technological curve. Though, on the other hand, the military has also been, in some departments, the worst of the offenders in anachronistic technology.(Check out how long IRS records were kept on massive spools of magnetic tape, not even the contemporary tape cartridges used for backup, but the big foot and a half or too foot reels you see in movies from the late sixties.)

7. We can see the proof of this in heavily regulated industries, where existing firms tend to do very little innovation, innovating in proportion to the number of competitors. When completely insulated, such as utilities or other protected firms, likely the only innovations are those forced upon them by government fiat or total technological obsolescence of their existing plant. (See "Anti-Business Businesses" and "The Difference Between Public and Private, Or, The Real Monopolies and Cartels".)