Beautiful Equilibrium.
I’ve increasingly come to the conclusion that moral outrage is an intellectually shallow mechanism by which to solve problems.
Our world is flawed. People are corrupt, institutions are inefficient, and rationality does not always prevail. Divides get exacerbated; the rich get richer, and the more powerful keep accumulating power. This is probably more true when you live and build in a country like Pakistan.
And if we’re in the business of change, outrage threatens deeper inquiry and, consequently, deeper problem-solving.
The peril of outrage
If we look around ourselves, outrage has become the de facto norm.
Twitter, LinkedIn, and in-person conversations all feature some kind of outrage, directed mainly from those without power/position to those with both leverages.
The problem is when outrage becomes an end in and of itself. You say your piece; you exit left. You pass a moral judgment, vindicate yourself, and your part is done. That’s why the left continues to cede space: because outrage (or canceling or patronizing or woke-ism) is the defining and only characteristic. There’s nothing beyond it.
The trouble is that this does nothing to dislodge existing structures.
Whatever form of organization one works for, whether it is a group of activists or leaders of social enterprises or corporations, you’ve got to start treating dysfunction with curiosity rather than outrage.
Beautiful Equilibrium
It is inevitable that once you begin working on social change and have the audacity and ambition to make a dent in the problem, you’ll encounter items that invite moral outrage.
For example, in our work with Taleemabad, we come into contact with the government on a daily basis. Once you look at the whole enterprise up close, you understand why it’s one of the most dysfunctional organizations on the planet1.
People are ‘corrupt,’ want bribes, and are apathetic. Most are appointed as a favor to someone else. Fifty people are assigned one simple task. The real ‘decision makers’ aren’t even visible and apparent, so accountability is non-existent.
It is very easy to look at that and, like most young people these days, huff and puff, sigh, express outrage, engage in some ‘us vs. them’ patronization, feel good about oneself but terrible about the situation, and spiral into negativity. There’s no way out of this manner of thinking.
It is harder to ‘fall in love’ with the problem.
And by ‘falling in love,’ I mean that you treat the problem as a case study in beautiful equilibrium:
It is beautiful because it is a work of art involving coordination and incentivization to get a large group of people to exhibit similar behavioral patterns. It’s complex, and it has happened, even if by accident.
It is equilibrium because it persists and it has settled. Getting people to behave a certain way is hard already, but getting them to stick to it, despite a clear strategic push to be ‘corrupt,’ for example, proves that some incentives have worked, and there’s a silent force that keeps people behaving this way. This silent force is incredibly potent -- even if it is in the service of the wrong things.
The work of social change, then, is to first treat the problem as a case study of beautiful equilibrium -- and once you’ve done that, to leverage the ‘silent force’ in your favor. I argue that the ‘silent force’ — which is at its core just plain incentives — is powerful enough to do the work of a thousand people. It is your invisible workforce2 and your most effective changemaker.
I thought deeply about listing specific examples of our work with the government of Pakistan.
Despite clear warnings not to enter this minefield, we went all in on working with the government and took along our entire organization. Contrary to expectations, two years later, we’ve achieved scale and continue to grow. We have deployed our solution in multiple theatres/districts and, without paying a penny in bribes, have earned multi-million dollar contracts. We've stayed the course despite three governments changing since we started, and I believe it boils down to this mental model of noticing beautiful equilibrium everywhere and then influencing it.
However, I’m aware that I cannot share specific examples because of the sensitivity of the institutions involved and because I fear someone will take the sword of moral outrage and stab the institutions and people we have worked with.
I will attempt an alternative where we can still dive into the concept applied to the seemingly random world of heavy-duty machinery and its taxation system.
Lasbela’s Golden Goose:
The next time you drive on a highway in Pakistan, note the number plates on heavy-duty machinery— 16-wheelers, buses, and trucks. Once you begin noticing it, you will realize that a lot of them are registered in Lasbela (a district in Balochistan -- as written on the plates) and look like this:
So far, so good. Most people would leave it here.
But I want you to remain curious -- this is the most underrated mechanism for diagnosing equilibrium.
You will set up a raw mental mechanism by which you count the ratio of heavy-duty vehicles that bear this number plate. Nothing exact, no mathematics, just raw observation.
Eventually, this rabbit hole begins to yield dividends. You start to notice that the ones with this number plate are the majority. Even Daewoo has their new fleet of Volvos on Lasbela number plates.
The next step is to avoid the urge to google it. Our minds are muscles, and GPT-ing and googling get in the way of curiosity.
Instead, do a mental google search. Ask yourself, “This is very interesting; why are they all going to Lasbela to get registered?”
There are inevitably hypotheses that begin to emerge:
“Maybe because Lasbela is cheap. But why is it cheap?”
“It could be geography. But where would Lasbela need to be for geography to play a role?3”
“But if Lasbela is from Balochistan, and if corruption increases the farther you go from centers such as Islamabad/Karachi/Lahore, won’t corruption and bribery kill this natural market movement?”
You’ll notice that each hypothesis is essentially a rabbit hole -- a question with more questions embedded in it. This is critical; you do not want uninteresting dead-end hypotheses because you want to trick your brain into remaining curious.
We’ll pick geography as a hypothesis and unpack it further. Your brain is now having an internal conversation with itself:
“Who needs these heavy vehicles?”
“Probably trucking/logistics/transportation carriers.”
“Where would Pakistan’s most dense logistics activity be concentrated? Probably Karachi —it’s the dominant port city.”
“Okay, why not register in Karachi?”
“Probably because of lower taxation?”
“Why do you need lower taxation on a heavy-duty vehicle?”
“Probably because it is linked to the horsepower of a car, and taxation must be pretty steep for heavier horsepower cars.”
“Okay, fair enough, but then is Lasbela a port city? It would need to be”.
“Why so?”
“Because….most trucking routes may operate from the port/sea routes AND because most new vehicles arrive by shipping containers?”
“Yeah, they’re definitely being imported because we don’t make them in Pakistan.”
“So it's not Karachi, it’s not Gwadar, but it IS in Balochistan, so somewhere close to Karachi but on the coastline?”
Bingo -- and with that, you’ve guessed Lasbela’s location.
A quick Google check to verify, and then back to hypotheses.
So there are some geographical reasons why it works: Lasbela is close to the sea and the port. We switch from geography to economics.
“Is it actually cheaper to register? If so, it is quite a great business strategy to increase a district’s revenue.”
A quick check to verify on Google if it is indeed cheaper — and you stumble upon a group of nerds on PakWheels discussing this exact case in 2013.
Back to hypotheses:
“But there’s always corruption…why isn’t corruption killing this natural market movement?”
“What would happen if a greedy excise and taxation officer decided to demand an unnaturally large bribe?”
“I think everyone would be furious…because there might be other districts that are cheaper AND on the coast, and registrations may move to that district?”
“So there might be corruption, but there might be an upper cap on that corruption, adjusted to undercut the listed price + the bribery premium in the next adjacent contending district?”
“That would need to happen…otherwise, the business would just move away, and you end up killing the golden goose.”
“Interesting. A way to gauge bribery rates is to think of them as taxes4; you can’t overdo them; Lasbela is in beautiful equilibrium.”
“Okay, but it can’t be a one-off. If officials in Lasbela have discovered this golden goose, they may have found other such opportunities, too”.
A quick return to Google. And you discover that Lasbela is home to the third-biggest shipbreaking yard in the world.
It is on the shore, and it is called Gadani. In the early 2000s, Gadani came to a standstill. The government had overdone taxation and duties.
To revive it, the ship-breaking duty was reduced from 15% to 10%. Activity promptly resumed. Thirty thousand people were once directly employed in Gadani. However, many have died in horrific accidents in the years since the subsidy was reduced. Gadani seems like….an entrepreneurial hub. The accidents are an equilibrium because most shipbreaking activity is carried out by private companies, who would naturally want to squeeze profit at any cost—even if it is dangerous.
On a separate note, there’s a whole world of controlled bribery in Gadani, where customs officials tax only a tiny portion of the millions of liters of fuel left in ships when they arrive at the yard and ‘ignore’ the rest5. Sometimes, it leads to tragic disasters when the collectors of the ignored fuel don't show up for collection fast enough before the fuel catches fire.
You return to the economic hypotheses for heavy-duty vehicles:
“But isn’t the registration of a car tied to its value? Isn’t that why people register in Islamabad — to increase resale value?”
“That’s true. But what incentive do freight/logistics/transport companies have not to want better resale value?”
“The positive delta in registration tax savings must be higher than the negative delta of the hit on resale value?”
“That AND who would want to resell a 16-wheeler? It would do million+ miles in a short period, and with little in the way of serious emissions/road safety standards, you’d hang on to it for a really long period of time.”
“And by the time you sell, even if there is a negative delta in resale price, it will be offset by a) the positive delta on tax savings + b) the profit you earn from the vehicle.”6
Beautiful Equilibrium.
The above is an example of a case study that runs in your head. While you shower, drive, cook, work out — or engage in cognitively light tasks. In that way, it’s almost…invisible.
Why put in this labor?
Because of this logic, we've evaded tight corners in several cases in our work with the government. We also carry on when others throw their hands in the air, label it a ‘lost cause,’ and move on.
You see — once you notice beautiful equilibrium, you also begin to notice how to influence it.
If there is bribery, you know what its upper limits are. This is not to say that you pay the bribe, but making this knowledge known to others has been a foolproof way of not having to pay a bribe.
And once you don’t pay it, you set a new equilibrium. Every subsequent case then has the power of precedent and the new equilibrium baked in.
People settle on the new equilibrium faster than you think.
You’ve harnessed the silent force.
The theory:
You treat every problem as a beautiful equilibrium.
You remain curious enough to understand why the equilibrium is the way it is.
You then attempt to influence the equilibrium.
You spend 95% of the time on 1 & 2. That will always remain the hard part.
The applications of this approach are endless. It can be used for everything, from changing the behaviors of entire government departments to achieving stability amidst governmental chaos to more effectively influencing and advocating within large bureaucratic structures.
We probably need to do more as an organization to adopt this ethos, but there are early signs that it is catching on. Taleemabad teams spend an inordinate amount of time studying the ‘system,’ — mapping stakeholders, and ‘stalking’ everyone from parliament to bureaucracy to the military to understand cues and identify beautiful equilibriums.
As an example, see below a map of all stakeholders in the education system in Pakistan, with sublinks to their attitudes/behaviors/positions. This is inherently unbridled curiosity at play.
It is, however, just a starting point.
That should help you understand the level of depth investigations into equilibrium must have.
Ultimately, I understand this may seem 'weird’ to most people. It borders on the obsessive.
But if you’ve arrived at this point of the blog, you’re probably part of the rare sliver of people who:
Believe that it is worthwhile as a life’s mission to attempt to turn around a whole oil tanker of a country (a quarter of a billion residents in Pakistan);
Recognize that most beauty is to be found in places where there is the most dysfunction.
Are audaciously optimistic to believe that it is possible to influence and change dysfunction for the better — at scale— as long as we can stop being outraged.
If we don’t already do so — we should talk :)
It is probably worthwhile to think of the government as an ‘organization’ -- a corporation almost, because it is then possible to apply similar mental models of power/decision making/consensus to it instead of slipping into territory where you treat government as one big black box.
I find the mental model of equalizing incentives to people/labor important because it’s one sure-shot way of staring value straight in the face. In my opinion, capitalism produces value less as a direct function of labor and more as a function of visible and invisible incentives.
Probably fair to note that I had forgotten the geography lesson from 6th grade that taught us where Lasbela was.
Moral outrage on this will need to be held back as the investigation continues.
Horror in Gadani, 2016 HRCP report.
A quick note on Lasbela’s taxation — this is an ongoing obsession/investigation, so some facts may still need verification. A call to the excise office is in order…
This is such a good read Haroon. Ironically enough I am often debating the same logic in class, where the most viable solution is presented as doing away with the government. I prefer working with the system, fighting the small battles we can and paving the path for the larger ones to come. The government exists with its inefficiencies, the point is to engage with these inefficiencies and ensure that you make your way towards your north star. Anger and frustration at the system while very natural do very little to help the most vulnerable people.
This was really interesting to read especially through the frame of incentives.
Coincidentally just came across this on Antonio Gramsci and Walter Benjamin’s take on social change: https://www.instagram.com/p/DFoxzYCsiQ2/?igsh=OXA4Y2tocGx1Ym1n
(I wouldnt be so quick to dismiss the left! Liberals though are a different story…)