Profit Logic

The relationship between the ruling class and its masses hinges upon, among other things, the ruling  class’s ability to translate its agenda into policies acceptable to the masses. This feat requires the individual to actively work against their own interests — ideally with an abundance of enthusiasm and patriotism. We marvel at the willful ignorance and denial of the masses, the Ninth Wonder of the World.

Profit logic is the language, confused logic and authoritarian assumptions that makes the masses happily serve the ruling class. It is the poetry by which Establishment leaders and their flock converse to each other.

Professor John Weeks gives us an example of profit logic in his book, Economics of the 1%:

The philosopher George Santayana wrote, “Those who cannot remember the past are condemned to repeat it”. For bankers and speculators this should be rephrased: “Those who profit from the past are delighted to repeat it.”


Profit logic is a dual meaning language. It is meant to convey, one meaning — the ruling class agenda — and translate it into another meaning that purports to support society and the individual.

Profit logic is predicated first and foremost upon a foundation of Establishment colonized egos. Without the colonized ego, profit logic can hold little sway. To the independent uncolonized ego, profit logic might even sound absurd and ridiculous.

The proper thinking habits and authoritarian thought structures must be present for profit logic to operate properly. Once Establishment ways have been sufficiently subsumed and become firmly entrenched within the individual through the maturation process, i.e., growing up, profit logic makes perfect — and comforting — sense.

Meaning is determined by layers of official authority and assumptions. Profit logic has the same words, grammar and phonetics as English, but usually opposite meanings, which are determined by  1) the label authority (politicians, scholars, parents, priest, TV, etc.), 2) subject matter/context of interlocutors, and 3) who the interlocutors are, and how they are defined and define themselves. Lay this mix on the bedrock of the Establishment, and you have your herd of Liberals, Conservatives and other herd-like individuals.

With this narrow thought structure in mind, the meaning and importance of words and phrases further depends on what is beneficial to the ruling class at that time. This pro-ruling class direction is communicated via the label attached to the shriveled ego of the individual. This makes the label flexible so that profit logic does not have to rely on the more rigid structure and defined terms, but may bend at the whim of the Supreme Executive.

For example, the Conservative generally grows up supposedly holding a “pro-life” stance (but crucially, not necessarily valuing life). They also are taught to be suspicious of the public sector. And as Conservatives they also hold the “principle” of “keeping government out of private life”. But because high-birth rates and unwanted births among the masses tend to benefit the ruling class. Label authorities, including religion and conservative “philosophy” will override the Conservative “principle” of “keeping government out of private life”, to force women to have children they should not have or don’t want.

Contracting Stupidity

Of course the central purpose of profit logic is to encourage the stupidity of the masses. Through the constant assault of Establishment inputs, the individual is bred and conditioned to not only respond favorably to ruling class edicts that work against their own interests, but to fight for them.

A recent article on the winners of the Nobel Prize in economics in the New York Times illustrates profit logic stupidity quite well. Oliver Hart, professor at Harvard, and Bengt Holmstrom at MIT, won for their work on “how contracts can encourage mutually beneficial behavior.”

First off, does it really take Ivy League professors to instruct society on how to make mutually beneficial contracts? We believe not. The Preservation Society  believes two equal parties can come to fair terms on their own. One might ask if these economists have not observed that fair terms are not a function of “contract mechanics”, but of the relative influence each party has. Would it be surprising if the more powerful party took advantage of the weaker one, despite what “contract theory” says? Perhaps our Nobel winners are still wrestling with this quandary. Common sense is not a strong point of the Established order.

Dr. Hart’s focus has been on “Incomplete Contract theory”. The Times reports:

Contracts are incomplete instruction manuals. They cannot specify what should be done in every case. Instead, they must stipulate how decisions should be made.

“His research provides us with theoretical tools for studying questions such as which kinds of companies should merge, the proper mix of debt and equity financing, and which institutions such as schools or prisons ought to be privately or publicly owned,” the Royal Swedish Academy of Sciences, which awarded the prize, said in a news release, referring to Dr. Hart.

In the ruling class world these things require Nobel laureates to figure out. But if one can’t figure out on their own whether prisons should be for profit or not, should they really be in a position to be decide such things? These are the kinds of “decision makers” preferred by a ruling class society. They are immune to integrity.

Meanwhile, Dr. Holmstrom has concentrated his explorations on employment contracts. What insights has he come up with?

  1. he has “presented evidence that companies should tie pay to the broadest possible evaluation of an employee’s performance”.
  2. Another “important implication of his work is that it makes sense to wait and see how things turn out. That can be done by setting aside a portion of compensation. If the company benefits, the value of the bonus set aside can be increased. If the company does not, it can be reduced.”
  3. “He has also found that companies should tie pay to the share price of other firms
    in the same industry. It makes little sense to reward an executive for an increase that
    reflects broader economic factors, or to punish them for setbacks beyond their
  4. “Paying teachers based on test results, for example, could lead them to devote less time to teaching other skills. This suggests that employers should balance fixed pay with performance incentives.

At first glance the person with common sense might ask why such a big commotion for such mundane and unenlightening conclusions. The over-complication of “contracts” into a field of Ivy League study is, in common sense English, a bit stupid. Indeed, the needless complication of anything is in itself a form of stupidity. It is a hallmark of Profit Logic. It should be well known among the masses, for their own good, that Profit Logic Kool-Aid works against them and for their masters.

In the last paragraph of the Times article we read what might be the inspiration for these studies and their elevation to “scholarly” authority:

“Incomplete-contract theory predicts that entrepreneurs should have the right
to make most decisions in their firms as long as performance is good, but investors should have more decision rights when performance deteriorates,” the academy said in an explanation of Mr. Hart’s work.

Why must this be so? Because “Incomplete-contract theory” says so! “Contract theory” — incomplete or not — is simply an authoritative concoction whipped up to justify takeovers, among other big business priorities. Translated, profit logic says: “transferring assets and property from the individual to investors, bankers and other well-position entities is good for business.”

If a business experiences hardship and “performance” drops, the solution, for some reason is for the owner, who knows the business, has a stake in it, and cares about it, should hand it over to “investors”, who are more tangential to the enterprise, and not necessarily loyal to it. These investors (often banks) are somehow  supposed to turn ailing business around when the owner couldn’t, despite the record which shows that banks and investors are more like predatory confiscators who strip companies of their assets and impose austerity.

This makes sense in a ruling class society because assets are transferred into Our hands, and out of the masses’. We cite “contract theory” to support Our position.


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