Machiavelli is alive and well.

Niccolo Machiavelli was a fifteenth century politician who practiced a form of politics designed to drive people towards his desired goals. The art was in telling people what they needed to hear to act in ways that may have seemed contrary to the eventual aims, but would cause the sum of the parts to meet that goal.

He described the complexities of politics in a way that at the time was amazing, and he countered the concerns many at the time would have had with a lot of discussion on ethics.

Since the fifteenth century, Machiavelli’s writings have been core to the teaching of politics around the world.
In the last couple of decades the Machiavellian skills of business executives and politicians have greatly improved, to the point that today’s world leaders far surpass the teachings of the middle-age expert whose name has been used to mean all the worst aspects of the art of politics.

Machiavelli did try and keep his goals in mind when he implemented devious tactics to deliver his strategies. And the same can be seen today. The huge difference is that the goals of politicians and business executives are now all too often focused purely on their personal wealth and not on more noble and longer-term goals.

Business leaders who focus on meeting short-term sales targets at the expense of the long-term health of a company are far too common. At the extreme end of this we see despicable people like Bernie Madoff, who created an entirely fraudulent business to allow him to prosper at the cost of thousands of others.

But many companies of all shapes and sizes are driven to make choices, which hurt their long-term viability just to meet Wall Street expectations that are linked to large bonus payouts, but at the cost of the future.

A very common technique is to encourage customers who lease products or pay for an ongoing service agreement to renew that agreement earlier than they need to, in exchange for a large discount. This in effect allows the balance sheet to reflect the right numbers for right now, but leads to the volume of revenue over the years to decline. This technique is incredibly common. The customers who get these discounts then find the quality of products and services decline months or years later because the vendor had to lower their costs to keep up future months profitability. In the end of this cycle (nearly) everyone loses.

Now add to this the really creative accounting models of the finance industry, including banks, insurance companies and venture capital companies. This whole industry is designed to move capital from the production to the pockets of financial institutions.

Politicians then get paid by the Machiavellian elements of business to change their policies to further enhance the wealth of themselves and their funders.

What we have today is a Machiavellian form of capitalism, that isn’t about innovating, creating and distributing, but is instead focused on today and not tomorrow.

Luckily not every business follows the concept of Machiavellian Capitalism, but I am at a loss to find a single politician that doesn’t.

Every time I hear about a political decision that sounds nuts, it always turns out that many people have been feeding at the trough of the people who are happy with the outcome. It happens on every side of a political argument and everywhere in the world.

If Machiavelli’s memory were to find out about how his ideas are being used, it would be turning over in his grave.


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