I saw a post over at Chris Janc's blog today that got me thinking.  Having spent most of my time in college studying markets, I'm inclined to somewhat agree, though I think it is the competition that is good and not greed itself.  While I'm sure there have been great ideas that weren't directly driven by the desire to make money, to spread them across the world is expensive.  And few people are going to take on that expense without something in it for them.  The wisdom of Kevin Nealon's character in Joe Dirt comes to mind:

Hey this isn't a charity. Maybe one of these days UNICEF will get into the impound business, but until then we're the people to see.

I wish Unicef would get into the impound business, but that is for another time.  This got me thinking about the complex animal that is greed a little more than usual.  And when I say animal, I really mean it, it is a living thing.  In its' infant stages, its' probably the best thing going.  There are few times when as much progress will be made as when someone gets an idea and thinks "man, this is a great idea.  I could make a career out of this".  Ideas flow so quickly that its' hard to catch them all, and the greedy individual (from now on referred to as Gordon) works like a man possessed.  The combination of inspiration and enthusiasm makes for some of the most amazing things people have ever created.

Like babies and puppies, greed can't stay young forever, and as it ages it definitely changes.  In the teenage years, reality starts to set in, and the Gordon realizes that he doesn't enjoy it as much anymore.  The motivation is starting to fade, perhaps because the money is already coming in and perhaps because the brain is craving that rush it had in greed's infancy.  The greed is still good at this point, but its' starting to get some zits.

If the Gordon is lucky, his greed will make it to middle age.  In middle age, greed gets kind of complacent.  Its' still good, but kinda tired.  Competitors have come out of nowhere, all wanting a piece of Gordon's pie.  The drag of having to lay people off or cut back on benefits in order to stay competitive is getting to our hero, and it's clear that he doesn't love it as much as he used to.  He's still good at this point, but approaching some kind of neutral state.  His idea is still benefitting society though. 

Its' what happens in the sunset of greed's life that can be troublesome.  As the marketplace gets more and more filled, Gordon is dismayed to see his profit margins shrinking.  It could be the new kids on the block are outdoing him at his own game, or it could be that his priorities have failed to keep up with the times.  Regardless of the reason, greed is on life support all the sudden.  And it now has three options that I've seen.

• Be content with what it's made so far (not likely, this is greed we are talking about)
• Expand into new markets
• Try to gain a competitive advantage through innovation
• Try to prevent the world from changing, in the hopes that it will allow business to continue as usual.

Number one is not even worth discussing, although I suppose it is possible for Gordon to be content with his current venture, and  channel his greed into a new one.  Number two is probably not worth wasting too much time on either, as there are fewer and fewer unexplored markets these days (the tobacco to children market is still waiting to be tapped though!).

This leaves innovation or resistance as the ways greed keeps going.  In my mind, innovation is the only choice.  Sure, it is going to blow up in your face sometimes, but you've got to try.  It may not have been the greatest idea, but AIG was innovating when they came up with the derivative investments that have caused so much havoc, and they made a lot of people a lot of money for a lot of years.  Sure, there can be catastrophic effects from the innovation, but we will learn from them, and move on.

Its' when greed takes the fourth option that it turns bad.  Rather than trying to compete in the market, its' now trying to manipulate the market.  This often means creating some kind of artificial barrier to entry in the marketplace, which could be done by lobbying for tighter regulations that they know will put their existing competitors out of business.  This is never a good thing, and its' indicative of a kind of systemic rot in the company.  I'm not sure that AIG was completely free of this kind of behavior, but I think that GM is a much better example.  Throughout the 90's and 2000's, it was getting clearer and clearer that the oil we have is not going to last forever, and that we ought to use it more sparingly.  Seeing this, smart manufacturers started making more efficient vehicles, even before various governments mandated such action.  And smart consumers bought these vehicles.  GM apparently didn't have any ideas, so they decided to lobby against increased fuel economy standards and see how many different gas guzzling monstrosities they could build on a generic SUV frame.  Instead of putting money into research and development (where greed is REALLY good) they decided to put it into marketing, lobbyists, and politicians.  We're seeing now how bad this can turn out.

I know I'm painting in broad strokes here, that greed is much more nuanced than I could possibly describe in this space.  But I guess the picture is a little sharper than when painted with the "greed is good" brush that we see so often.  In short, greed is mostly good.  Its' one of the best things we have right now, kind of like nuclear energy.  Like nuclear energy, when greed goes bad, it goes really bad.  Sometimes the kind of bad we can recover from, but sometimes the "oh shit" kind of bad that takes everything else down with it.  So for all you greedy bastards out there, try to keep it good!