Gitcoin and Shell: Building Strategy Around Psychopaths
August 17th, 2023
Gitcoin recently announced a partnership where Shell would be contributing
$500,000 towards climate change. This sparked a nontrivial amount of outrage
among many thought leaders within the crypto space, mainly from individuals who
were concerned about greenwashing, and about Gitcoin lending their good brand
to an evil company.
And at a surface level, the outrage makes sense. Shell has at points in time
been the largest oil company in the world, and the activities of the Shell
corporation have indisputably been a major contributor to the damage that has
been dealt to Earth's ecosystem.
Furthermore, $500,000 is completely invisible on the Shell balance sheet. In
the past year, Shell has made more than $350 billion in revenue and booked more
than $80 billion in profits. In the time it took you to read this far into the
article, Shell has made more money than they donated to Gitcoin.
At the same time, $500,000 is more money than any of the other oil giants
contributed to Gitcoin. Where are the donations from Exxon, Marathon, Chevron,
BP, and Valero? And now that they've seen Shell's attempts to greenwash get
swatted down, are they likely to even try in the future?
One fact that the climate space struggles with is acknowledging that all large
corporations are pure psychopaths. If you successfully take out Shell for its
psycopathic behavior, Conoco will rise up to take their place. Or Sinopec, or
Equinor, or PetroChina, or Aramco, or Duke Energy, or Enbridge, or Occidental,
or Pioneer, or Philips 66, or Suncor, or Imperial Oil, and so on and so on.
There are more than 200 oil companies in the world worth over a billion
dollars. You can't guilt trip the oil industry into being a good actor. You
can't guilt trip any large corporation into being a good actor.
The business world is a fundamentally Darwinian place. Every business in the
world is vulernable to losing their customers and revenue to another business
that has a more attractive product or better economics. Any business that
prioritizes ethics over profit has fundamentally less fitness in the
marketplace than a business that is intentionally unscrupulous.
At the top of the business world, where corporations are each booking literally
a billion dollars in revenue every day, the only path to success is to be
psychopathically optimized around growth and profit. Any top corporation that
de-empahizes profit in the name of doing the right thing will quickly be
outcompeted and cease to a top corporation. We don't live in a world where all
of the top corporations decided to be greedy. We live in a world where the top
corporations are at the top because they are greedy. Asking top corporations
to not be greedy is like asking a stream to not flow downhill; the physics of
our economy simply don't allow it.
At the same time, something has to change. The psychopathic actions of the
world's largest economic actors are destroying our future. We, somehow, have to
get from the world as it exists today to a world where corporations are held
accountable for the external damages of their operations. And though we can't
change the physics of greed[1], we can use those physics to our advantage, and
make it so that the most profitable action of a corporation is actually to be
responsible for their actions.
As far as I can tell, there are really two effective tools available to us for
making that happen. The first is legal; if we levy hefty fines and jailtime to
punish environmental damage caused by a corporation, corporations will shift
their behavior because fines and jailtime both substantially impact profits.
The second is reputational; we can make use of media and public relations to
shift consumer behavior based on the perceived good or evil actions of a
corporation.
Gitcoin doesn't have any legal authority to levy fines or throw people in jail.
Which means the best Gitcoin can do is leverage its own brand and thought
leadership to drive consumer behavior.
Big Oil isn't going to go away. People are going to fill up their cars with
gasoline every week regardless of whether Gitcoin accepts money from Shell or
not. But if Gitcoin lends its brand to Shell in exchange for $500,000, people
may start to prefer Shell over Marathon or BP. And if Marathon and BP notice
that they are losing market share because Shell has a climate budget, they may
become inclined to carve out a climate budget of their own. We can start a
bidding war that turns $500,000 per year into $50,000,000 per month.
The one thing we need to be careful of is net regression. The behvior we want
to control is whether consumers prefer Shell over BP when they go to fill up
their gasoline cars. What we don't want is consumers starting to prefer
gasoline cars over electric cars on account of Shell's contributions to
Gitcoin. But I don't think that's a risk here. Everybody knows that oil is bad,
and everybody knows that Shell's $500,000 contribution is not balancing the
scales.
But that $500,000 is giving us a wedge that we can use to drive further change,
and it's a $500,000 gift that we should embrace. The world needs to change, and
the proponents of that change need to use every advantage that's available to
them.
Footnotes
[1] The above article talks about the physics of our economy as though they
can't be changed. But actually, the physics of our economy are determined by
fundamentals such as the structure of money and the nature of reputation, among
other things that humans theoretically have a large degree of control over.
It's possible that we actually can at some point change the physics of our
economy so that the winners aren't fundamentally required to be psychopaths.
The problem is that climate change needs to be solved immediately, and isn't
able to wait for a breakthrough in economic design. I believe that someday we
will actually get such a breakthrough, but its impossible to know when because
we are still missing key ideas. For the sake of solving the climate emergency
before it's too late, we need to pursue that change within the current physics
of the economy rather than wait for a miracle.
Gitcoin and Shell: Building Strategy Around Psychopaths
August 17th, 2023
Gitcoin recently announced a partnership where Shell would be contributing $500,000 towards climate change. This sparked a nontrivial amount of outrage among many thought leaders within the crypto space, mainly from individuals who were concerned about greenwashing, and about Gitcoin lending their good brand to an evil company.
And at a surface level, the outrage makes sense. Shell has at points in time been the largest oil company in the world, and the activities of the Shell corporation have indisputably been a major contributor to the damage that has been dealt to Earth's ecosystem.
Furthermore, $500,000 is completely invisible on the Shell balance sheet. In the past year, Shell has made more than $350 billion in revenue and booked more than $80 billion in profits. In the time it took you to read this far into the article, Shell has made more money than they donated to Gitcoin.
At the same time, $500,000 is more money than any of the other oil giants contributed to Gitcoin. Where are the donations from Exxon, Marathon, Chevron, BP, and Valero? And now that they've seen Shell's attempts to greenwash get swatted down, are they likely to even try in the future?
One fact that the climate space struggles with is acknowledging that all large corporations are pure psychopaths. If you successfully take out Shell for its psycopathic behavior, Conoco will rise up to take their place. Or Sinopec, or Equinor, or PetroChina, or Aramco, or Duke Energy, or Enbridge, or Occidental, or Pioneer, or Philips 66, or Suncor, or Imperial Oil, and so on and so on. There are more than 200 oil companies in the world worth over a billion dollars. You can't guilt trip the oil industry into being a good actor. You can't guilt trip any large corporation into being a good actor.
The business world is a fundamentally Darwinian place. Every business in the world is vulernable to losing their customers and revenue to another business that has a more attractive product or better economics. Any business that prioritizes ethics over profit has fundamentally less fitness in the marketplace than a business that is intentionally unscrupulous.
At the top of the business world, where corporations are each booking literally a billion dollars in revenue every day, the only path to success is to be psychopathically optimized around growth and profit. Any top corporation that de-empahizes profit in the name of doing the right thing will quickly be outcompeted and cease to a top corporation. We don't live in a world where all of the top corporations decided to be greedy. We live in a world where the top corporations are at the top because they are greedy. Asking top corporations to not be greedy is like asking a stream to not flow downhill; the physics of our economy simply don't allow it.
At the same time, something has to change. The psychopathic actions of the world's largest economic actors are destroying our future. We, somehow, have to get from the world as it exists today to a world where corporations are held accountable for the external damages of their operations. And though we can't change the physics of greed[1], we can use those physics to our advantage, and make it so that the most profitable action of a corporation is actually to be responsible for their actions.
As far as I can tell, there are really two effective tools available to us for making that happen. The first is legal; if we levy hefty fines and jailtime to punish environmental damage caused by a corporation, corporations will shift their behavior because fines and jailtime both substantially impact profits. The second is reputational; we can make use of media and public relations to shift consumer behavior based on the perceived good or evil actions of a corporation.
Gitcoin doesn't have any legal authority to levy fines or throw people in jail. Which means the best Gitcoin can do is leverage its own brand and thought leadership to drive consumer behavior.
Big Oil isn't going to go away. People are going to fill up their cars with gasoline every week regardless of whether Gitcoin accepts money from Shell or not. But if Gitcoin lends its brand to Shell in exchange for $500,000, people may start to prefer Shell over Marathon or BP. And if Marathon and BP notice that they are losing market share because Shell has a climate budget, they may become inclined to carve out a climate budget of their own. We can start a bidding war that turns $500,000 per year into $50,000,000 per month.
The one thing we need to be careful of is net regression. The behvior we want to control is whether consumers prefer Shell over BP when they go to fill up their gasoline cars. What we don't want is consumers starting to prefer gasoline cars over electric cars on account of Shell's contributions to Gitcoin. But I don't think that's a risk here. Everybody knows that oil is bad, and everybody knows that Shell's $500,000 contribution is not balancing the scales.
But that $500,000 is giving us a wedge that we can use to drive further change, and it's a $500,000 gift that we should embrace. The world needs to change, and the proponents of that change need to use every advantage that's available to them.
Footnotes
[1] The above article talks about the physics of our economy as though they can't be changed. But actually, the physics of our economy are determined by fundamentals such as the structure of money and the nature of reputation, among other things that humans theoretically have a large degree of control over. It's possible that we actually can at some point change the physics of our economy so that the winners aren't fundamentally required to be psychopaths.
The problem is that climate change needs to be solved immediately, and isn't able to wait for a breakthrough in economic design. I believe that someday we will actually get such a breakthrough, but its impossible to know when because we are still missing key ideas. For the sake of solving the climate emergency before it's too late, we need to pursue that change within the current physics of the economy rather than wait for a miracle.