Fireflies and Algorithms

fireflies

We’ve been looking at workfare — the legislated link between jobs and the social safety net. An article published last week  — Fireflies And Algorithms — The Coming Explosion Of Companies[1] brought the specter of workfare to the legal profession.

Reading it, my life flashed before my eyes, beginning with one particular memory:  me, a newly-hired associate, resplendent in my three-piece gray pinstripe suit, joining the 4:30 queue at the Secretary of State’s office, clutching hot-off-the-word-processor Articles of Incorporation and a firm check for the filing fee, fretting whether I’d get my copy time-stamped by closing time. We always had to file today, for reasons I don’t remember.

Entity choice and creation spanned transactional practice:  corporate, securities, mergers and acquisitions, franchising, tax, intellectual property, real property, commercial leasing….  The practice enjoyed its glory days when LLC’s were invented, and when a raft of new entity hybrids followed… well, that was an embarrassment of riches.

It was a big deal to set up a new entity and get it just right — make sure the correct ABC acquired the correct XYZ, draw the whole thing up in x’s and o’s, and finance it with somebody else’s money. To do all that required strategic alliances with brokers, planners, agents, promoters, accountants, investment bankers, financiers…. Important people initiated the process, and there was a sense of substantiality and permanence about it, with overtones of mahogany and leather, brandy and cigars. These were entities that would create and engage whole communities of real people doing real jobs to deliver real goods and services to real consumers. Dissolving an entity was an equally big deal, requiring somber evaluation and critical reluctance, not to mention more time-stamped paperwork.

Fireflies And Algorithms sweeps it all away — whoosh! just like that!– and describes its replacement:  an inhuman world of here-and-gone entities created and dissolved without the intent of all those important people or all that help from all those people in the law and allied businesses. (How many jobs are we talking about, I wonder — tens, maybe hundreds of thousands?) The new entities will do to choice of entity practice what automated trading did to the stock market, as described in this UCLA Law Review article:

“Modern finance is becoming an industry in which the main players are no longer entirely human. Instead, the key players are now cyborgs: part machine, part human. Modern finance is transforming into what this Article calls cyborg finance.”

In that “cyborg finance” world,

“[The “enhanced velocity” of automated, algorithmic trading] has shortened the timeline of finance from days to hours, to minutes, to seconds, to nanoseconds. The accelerated velocity means not only faster trade executions but also faster investment turnovers. “At the end of World War II, the average holding period for a stock was four years. By 2000, it was eight months. By 2008, it was two months. And by 2011 it was twenty-two seconds….

Fireflies And Algorithms says the business entity world is in for the same dynamic, and therefore we can expect:

“… what we’re calling ‘firefly companies’ — the blink-and-you-miss-it scenario brought about by ultra-short-life companies, combined with registers that remove records once a company has been dissolved, meaning that effectively they are invisible.”

Firefly companies are formed by algorithms, not by human initiative. Each is created for a single transaction — one contract, one sale, one span of ownership. They’re peer-reviewed, digitally secure, self-executing, self-policing, and trans-jurisdictional — all for free or minimal cost. And all of that is memorialized not in SOS or SEC filings but in blockchain.

“So what does all this mean?” the article asks:

“How do we make sense of a world where companies — which are, remember, artificial legal constructs created out of thin air to have legal personality — can come into existence for brief periods of time, like fireflies in the night, perform or collaborate on an act, and then disappear? Where there are perhaps not 300 million companies, but 1 billion, or 10 billion?”

Think about it. And then — if it hasn’t happened yet — watch your life flash before your eyes.

Or if not your life, at least your job. Consider, for example, a widely-cited 2013 study that predicted 57% of U.S. jobs could be lost to automation. Even if that prediction is only half true, that’s still a lot of jobs. And consider a recent LawGeex contest, in which artificial intelligence absolutely smoked an elite group of transactional lawyers:

“In a landmark study, 20 top US corporate lawyers with decades of experience in corporate law and contract review were pitted against an AI. Their task was to spot issues in five Non-Disclosure Agreements (NDAs), which are a contractual basis for most business deals.

“The study, carried out with leading legal academics and experts, saw the LawGeex AI achieve an average 94% accuracy rate, higher than the lawyers who achieved an average rate of 85%. It took the lawyers an average of 92 minutes to complete the NDA issue spotting, compared to 26 seconds for the LawGeex AI. The longest time taken by a lawyer to complete the test was 156 minutes, and the shortest time was 51 minutes.”

These developments significantly expand the pool of people potentially needing help through bad times. Currently, that means workfare. But how can you have workfare if technology is wiping out jobs?

More on that next time.

[1] The article was published by OpenCorporates, which according to its website is “the world’s largest open database of the corporate world and winner of the Open Data Business Award.”

Utopia For Realists Cont’d.

“Like humor and satire, utopias throw open the windows of the mind.”

Rutger Bregman

utopia for realistsContinuing  with Rutger Bregman’s analysis of utopian thinking that we began last week:

“Let’s first distinguish between two forms of utopian thought. The first is the most familiar, the utopia of the blueprint. Instead of abstract ideals, blueprints consist of immutable rules that tolerate no discussion.

“There is, however, another avenue of utopian thought, one that is all but forgotten. If the blueprint is a high-resolution photo, then this utopia is just a vague outline. It offers not solutions but guideposts. Instead of forcing us into a straitjacket, it inspires us to change. And it understands that, as Voltaire put it, the perfect is the enemy of the good. As one American philosopher has remarked, ‘any serious utopian thinker will be made uncomfortable by the very idea of the blueprint.’

“It was in this spirit that the British philosopher Thomas More literally wrote the book on utopia (and coined the term). More understood that utopia is dangerous when taken too seriously. ‘One needs to be believe passionately and also be able to see the absurdity of one’s own beliefs and laugh at them,’ observes philosopher and leading utopia expert Lyman Tower Sargent. Like humor and satire, utopias throw open the windows of the mind. And that’s vital. As people and societies get progressively older they become accustomed to the status quo, in which liberty can become a prison, and the truth can become lies. The modern creed — or worse, the belief that there’s nothing left to believe in — makes us blind to the shortsightedness and injustice that still surround us every day.”

Thus the lines are drawn between utopian blueprints grounded in dogma vs. utopian ideals arising from sympathy and compassion. Both begin with good intentions, but the pull of entropy is stronger with the former — at least, so says Rutger Bregman, and he’s got good company in Sir Thomas More and others. Blueprints require compliance, and its purveyors are zealously ready to enforce it. Ideals on the other hand inspire creativity, and creativity requires acting in the face of uncertainty, living with imperfection, responding with resourcefulness and resilience when best intentions don’t play out, and a lot of just plain showing up and grinding it out. I have a personal bias for coloring outside the lines, but I must confess that my own attempts to promote utopian workplace ideals have given me pause.

For years, I led interactive workshops designed to help people creatively engage with their big ideas about work and wellbeing — variously tailored for CLE ethics credits or for general audiences. I realized recently that, reduced to their essence, they employed the kinds of ideals advocated by beatnik-era philosopher and metaphysicist Alan Watts. (We met him several months ago — he’s the “What would you do if money were no object?” guy. )

alan watts cartoon

The workshops generated hundreds of heartwarming “this was life-changing” testimonies, but I could never quite get over this nagging feeling that the participants mostly hadn’t achieved escape velocity, and come next Monday they would be back to the despair of “But everybody knows you can’t earn any money that way.”

I especially wondered about the lawyers, for whom “I hate my job but love my paycheck” was a recurrent theme. The Post WWII neoliberal economic tide floated the legal profession’s boat, too, but prosperity has done little for lawyer happiness and well-being. True, we’re seeing substantial quality-of-life change in the profession recently (which I’ve blogged about in the past), but most have been around the edges, while overall lawyers’ workplace reality remains a bulwark of what one writer calls the “over-culture” — the overweening force of culturally-accepted norms about how things are and should be — and the legal over-culture has stepped in line with the worldwide workplace trend of favoring wealth over a sense of meaning and value.

Alan Watts’ ideals were widely adopted by the burgeoning self-help industry, which also rode the neoliberal tide to prosperous heights. Self-help tends to be long on inspiration and short on grinding, and sustainable creative change requires large doses of both. I served up both in the workshops, but still wonder if they were just too… well, um…beatnik … for the law profession. I’ll never know — the guy who promoted the workshops retired, and I quit doing them. If nothing else, writing this series has opened my eyes to how closely law practice mirrors worldwide economic and workplace dynamics.  We’ll look more at that in the coming weeks.

Something Rotten in Denmark

The lack of belief that our lives are meaningful is spiking suicide rates in wealthy First World countries whose citizens say they’re generally happy with their lives.

“Something is rotten in the state of Denmark”
Marcellus, Hamlet Act I Scene 4

Last time, we considered some of the findings of a huge international survey of money, happiness, wealth, and meaning conducted by Gallup and a couple University of Virginia professors. Digging deeper:

“One of the most disturbing findings involved suicide rates. Wealthier nations, it turns out, had significantly higher suicide rates than poorer ones. For example, the suicide rate of Japan, where per-capita GDP was $34,000, was more than twice as high as that of Sierra Leone, where per-capita GDP was $400.

“The strange relationship between happiness and suicide has been confirmed in other research, too. Happy countries like Denmark and Finland also have high rates of suicide.

“[The survey authors revealed] a striking trend: happiness and unhappiness did not predict suicide. The variable that did, they found, was meaning—or, more precisely, the lack of it. The countries with the lowest rates of meaning, like Japan, also had some of the highest suicide rates.”

From The Power of Meaning:  Crafting a Life That Matters, Emily Esfahani Smith (2017)

The Power of Meaning cites further data showing that:

  • Suicide rates are generally higher in wealthier countries than in poorer ones.
  • According to the World Health Organization, global suicide rates have increased 60% since World War II.
  • In 2016, worldwide suicide rates were the highest in 30 years.
  • In the U.S., suicide among 15-24 year-olds tripled from 1950-2000.
  • Among the middle-aged, suicide rates have increased by over 40% since the turn of the 21st century.

The lack of belief that our lives are meaningful is spiking suicide rates — especially in wealthy First World countries whose citizens say they’re generally happy with their lives. The 2017 World Happiness Report confirmed these findings:  Denmark ranked #2 in the list of happiest countries, and Finland was #5, yet both countries had high rates of suicide.

The World Happiness Report is no lightweight exercise in psychobabble — it is generated on the highest level of worldwide policy making. This is how it describes its origins:

HR17_3_cover_small-232x300The first World Happiness Report was published in April, 2012, in support of the UN High Level Meeting on happiness and well-being. Since then the world has come a long way. Increasingly, happiness is considered to be the proper measure of social progress and the goal of public policy. In June 2016 the OECD committed itself “to redefine the growth narrative to put people’s well-being at the center of governments’ efforts.” In February 2017, the United Arab Emirates held a full-day World Happiness meeting, as part of the World Government Summit. Now on World Happiness Day, March 20th, we launch the World Happiness Report 2017, once again back at the United Nations, again published by the Sustainable Development Solutions Network, and now supported by a generous three-year grant from the Ernesto Illy Foundation.

The Report is long and packed with statistical analysis, tables, graphs, and other data-nerd content, but if you’re game for it, it makes for fascinating reading.

Both the UVA/Gallup survey and the World Happiness Report revealed that dissatisfaction with work is a key contributor to the feeling that life lacks meaning, and to the escalating suicide rate.

Imagine how different the legal profession would be if it sought to promote not just the happiness of its members (that would be radical enough!) but also a sense of meaningfulness about working in the law.

We’ll be talking more about that.

For a summary of the UVA/Gallup study, see ScienceDaily, 18 December 2013:  “Residents of poorer nations find greater meaning in life.” For the original study, see S. Oishi, E. Diener, “Residents of Poor Nations Have a Greater Sense of Meaning in Life Than Residents of Wealthy Nations,” Psychological Science, 2013. You can request a reprint here.

Money, Happiness, Wealth, and Meaning

The ultimate wellbeing culprit is neither money nor the pursuit of it, but whether or not you believe your life has meaning and purpose. And according to one vast, worldwide survey, the residents of wealthy countries rate their lives as less meaningful than those in poor countries.

One reason money doesn’t make us happy is the stress of making it. The following is from Plutocrats:  The Rise of the new Global Super Rich and the Fall of Everyone Else, Chrystia Freeland (2012):

plutocrats“Until a few years ago, the reigning theory about money and happiness was the Easterlin paradox, the 1974 finding by Richard Easterlin that, beyond a relatively low threshold more money didn’t make you happier.

“But across countries, what millions of immigrants have always known to be true really is:  the people of rich countries are generally happier than the people of poor countries.

“The latest contrarian finding, however, is that moving to that state of greater wealth and greater happiness is decidedly unpleasant. As Angus Deaton, in a review of the 2006 Gallup World Poll, concluded, ‘Surprisingly, at any given level of income, economic growth is associated with lower reported levels of life satisfaction.’”

Freeland also cites Angus Deaton for showing that “the richer you are, the more covetous you become” — not a likely prescription for happiness.

A 2014 U of Virginia/ Gallup study weighed in with similar findings — Emily Esfahani Smith discussed them in The Power of Meaning:  Crafting a Life That Matters, (2017:

power of meaning“Though the study was enormous, involving nearly 140,000 people across 132 countries, it was also straightforward. A few years earlier, researchers from Gallup had asked respondents whether they were satisfied with their lives, and whether they felt their lives had an important purpose or meaning. [Prof. Shigehiro Oishi of the University of Virginia and Ed Diener of Gallup] analyzed that data by country, correlating the levels of happiness and meaning with variables like wealth, rates of suicides, and other social factors.

“Their findings were surprising. People in wealthier regions, like Scandinavia, reported being happier than those in poorer ones, like sub-Saharan Africa. But when it came to meaning, it was a different story. Wealthy places like France and Hong Kong had some of the lowest levels of meaning, while the poor nations of Togo and Niger had among the highest, even though people living there were some of the unhappiest in the study.

I.e., the ultimate wellbeing culprit is neither money nor the pursuit of it, but whether or not you believe your life has meaning and purpose. And according to this vast, worldwide survey, the residents of wealthy countries rate their lives as less meaningful than those in poor countries.

Analogizing from these findings to the legal profession, we would expect that, because the legal profession runs on the higher side of financial wellbeing, lawyers would report higher levels of happiness than less well-paid workers, but would also suffer from meaning malaise. And, since one of the wellbeing factors used in the survey was rates of suicide, we would also expect lawyers to have a correspondingly higher rate of suicide.

The high lawyer suicide rate (third highest among professionals, after doctors and dentists) has been well documented, and as we’ve been seeing, lawyers as a whole aren’t generally happy with their lives either, despite their profession’s higher rate of wealth.

We’ll look more into the meaning part of the equation next time.

Richard Easterlin is a professor of economics at USC. Sir Angus Stewart Deaton, FBA, is a British American economist and professor at Princeton. In 2015, he was awarded the Nobel Memorial Prize in Economic Sciences for his analysis of consumption, poverty, and welfare.

For a summary of the UVA/Gallup study, see ScienceDaily, 18 December 2013:  “Residents of poorer nations find greater meaning in life.” For the original study, see S. Oishi, E. Diener, “Residents of Poor Nations Have a Greater Sense of Meaning in Life Than Residents of Wealthy Nations,” Psychological Science, 2013

Can Money Buy Lawyer Happiness?

I thought the answer might be yes. I was wrong. Money doesn’t just fail to make lawyers happy, it actually makes them unhappy.

I thought the answer might be yes. Why? Because a few years back I blogged about the 2013 Colorado Supreme Court Lawyer Satisfaction and Salary Survey, which showed that, although 2/3’s of Colorado lawyers didn’t like their jobs enough to recommend them to someone else, at least they liked the money. And because a widely-cited study published the following year found that people in wealthier countries are happier than people in poorer countries. Put those two together, and maybe lawyers might say they’re happy overall, despite their job dissatisfaction.

I was wrong. I went several pages into the results of several Google searches and found nothing about happy lawyers or what makes them so. Happiness isn’t bad news, so maybe it doesn’t get reported, but still… why the long faces? More Google searches turned up a LegalCheek.com poll conducted in Great Britain the day after Theresa May gave the required notice of Great Britain’s withdrawal from the European Union. It reported that 70% of British lawyers weren’t happy about Brexit. But that doesn’t really count, does it?

the Happy LawyerThe Happy Lawyer:  Making a Good Life in the Law (2010) by law professors Nancy Levit and Douglas O. Linder had a promising title, but then, after an extensive review of the literature on lawyer happiness, the authors concluded that “[M]oney is the root of virtually everything that lawyers don’t like about their profession: the long hours, the commercialization, the tremendous pressure to attract and retain clients the fiercely competitive marketplace, the lack of collegiality and loyalty among partners, the poor public image of the profession, and even the lack of civility.”

So… money doesn’t just fail to make lawyers happy, it actually makes them unhappy. Hmmm.

Money certainly doesn’t make associates happy, even though 2016 saw their salaries leap to new heights — at least in the world of BigLaw. In fact, the position of associate attorney came in rock bottom in a 2013 CareerBliss survey of not just lawyers, but 65,000 employees of all kinds. Forbes, The Happiest And Unhappiest Jobs In America, March 22, 2013. (Here’s Above the Law’s take on that story.)

A couple years after the CareerBliss poll, the Dean of Pepperdine Law School countered that well, there at least some happy associates. Go ahead — guess who they were — answer below.

If money doesn’t make lawyers happy, then what does? Earlier this year, Global Financial (“Financing Justice”) reported survey results by Robert Half Legal that a business casual dress policy helps lawyers deal with stress. Not quite the same as making lawyers happy.

Seriously? Business casual is the best we can do?

the Anxious LawyerAn August 2016 Above the Law article had a promising title — Why Are Lawyers So Happy? — but it turned out to be a tongue-in-cheek response to an earlier article by Jeena Cho, author of The Anxious Lawyer, all-around great person and reigning Goddess of Mindfulness in the Marketplace. (I’ve met Jeena, and she would be horrified at me giving her that title, but I do it with a smile, and besides, I think it’s true.) Both articles were written in response to a survey conducted by the ABA and the Betty Ford Foundation, which Forbes reported in an article whose title tells you everything you need to know:  Study Indicates Lawyers Struggling With Substance Use And Other Mental Health Issues, July 30, 2016.

No, money doesn’t buy lawyer happiness — according to pollsters anyway. Of course some lawyers are happy — with the money, their work, and maybe even life in general. I hope that’s you, and I hope you know lots of people like you. As for the rest, it’s hard to be happy about much of anything when you don’t like your work.

We’ll keep following the thread of money and happiness next time, to see what else we can learn from it. In the meantime, here’s your answer:  Who are the happiest associates?  Tax lawyers.