• GFT is a theory of history exploring the functioning of institutions, the transmission of knowledge, and the landscape of power (among other things).
• An institution is a zone of close coordination maintained by automated systems. This operates on a spectrum; the most automated institution is the bureaucracy.
• Functional institutions are the exception, not the norm. They are created by Great Founders who coordinate people with a mission-based focus. Functional institutions involve building new ones or capturing and rebuilding existing ones.
• Most institutions in society are non-functional institutions. They merely imitate functional institutions, but create a narrative to convince people they are mission-based and functional too. This allows them to achieve modest gains 'locally', but it will always be limited because everyone is trying to keep up the appearance of functionality and perform the same sort of socially-accepted tasks, as opposed to diversifying and carrying out specific functions in a division of labour. It becomes a social club; credential-gathering and rent-seeking.
• Societies can be maintained through functional and non-functional institutions, but the latter carries opportunity costs. However, as long as functional institutions exist, it is possible to keep returning to it and copying elements of it and learning what makes up a functional institutional through reverse engineering. This puts you in the same 'tradition of knowledge' as the functional institution. However, this sort of imitation of practice is lower than a true transfer of knowledge.
• Even this imitation is no longer possible if that functional institution exists; at that point, you 'cargo cult' through blind imitation, and your ability to imitate degrades over time until it is all lost. Some functional institutions are simply irreplaceable; once they're gone, they're gone.
• Some functional institutions are so great that they burden their civilisational function all on their own: e.g. Wernher von Brown and NASA getting America to the moon.
• A civilization is an ecosystem of institutions. No institution is self-sufficient, all institutions operate as part of an ecosystem, receiving and giving support in complex arrangements. Functional institutions are 'outsized nodes' in this network, subsidizing all the others. An ecosystem of functional institutions reflects in the culture and produces a mood of optimism; nothing is beyond the civilisation's grasp.
• An empire is a region of coordination around a central power, where the central power is the cause of the region of coordination. Empires can be one large institution, or an ecosystem of institutions.
• Pareto principle: people who create functional institutions amplify their impact on the world. The power this lends is a means, not an end; an empire's aim is not to right wrongs or achieve personal aims (i.e. vengeance, grievance, rent-seeking, greed), but to lay the foundation for further institutions (fractal empire).
• A functional institution can outright solve a problem for an entire civilisation, e.g. the construction of infrastructure so important it changes the course of economic development for centuries to come.
• As a result of this, Great Founders are responsible for the vast majority of social technolgoy in society. Evolutionary analogies are insufficient to explain our social technologies, although mutation and evolution are helpful to understand why they decay. Social technologies are designed then implemented.
• Great Founders are the primary force that shapes society. To identify their functioning institutions, identify businesses, religions, governments, etc, that are radically outperforming their competitors. By investigating the distribution of Founders, we can make predictions about the future of fields and industries. By investigating the plans and intentions of Founders, we can make specific predictions about what the future holds. Great Founders determine the future social and material landscape of civilisation, and the future of the world. Societies with many Great Founders innovate and flourish while societies with few stagnate and deteriorate.
• Behind every great founder, you find a great team. From Buddha’s disciples to Bezos’s senior executives, small, closely coordinated groups seem to be essential for grand achievements. Watch here.

• A theory of history is an explanation of how things happen in the world.
• Everyone has an implicit theory of history. Usually inconsistent and incoherent without explication and conscious work, it will nonetheless be the basis of much of your action in the world.
• Having a theory of history is important to take the right actions - and accurately predict the results of those actions, otherwise we risk producing unknown consequences.
• The True theory of history is unmanageably complex; the true theory of history is the application of power laws to a small number of factors that we focus on to explain their outsized effects on the world.
• Historically long-lived institutions e.g. the Catholic Church are down to them understanding at least fragments of a true theory of history.
• Most people do not have a true theory of history because they do not even have the concept of such a thing. It is implicit for them. Or, they believe in one theory but their actions reflect another. Or, people switch theories in an unprincipled way, failing to rationalise this behaviour.
• Many people think history follows cycles. Are they right? And if they are, does the popular story of a luxurious society prone to decadence hold any truth? In this clip, Samo explains the problem with cyclical history.

• Theory: an theory of history is an explanation of how things happen in the world. GFT is a theory of history exploring the functioning of institutions, the transmission of knowledge, and the landscape of power (among other things).
• Great Founder:
• Institution: a zone of close coordination maintained by automated systems. This operates on a spectrum; the most automated institution is the bureaucracy.
• Empire: a region of coordination around a central power, where the central power is the cause of the region of coordination. Empires can be one large institution, or an ecosystem of institutions.
• Pareto Principle: people who create functional institutions amplify their impact on the world. The power this lends is a means, not an end; an empire's aim is not to right wrongs or achieve personal aims (i.e. vengeance, grievance, rent-seeking, greed), but to lay the foundation for further institutions (fractal empire).

• Do you believe in the Pareto principle/power law as a defining feature and even law of human history and civilisation?
• How can we tinker with GFT? What insights did Samo miss, or what assumptions has he made that are incorrect?
• Is he right, and if he is, what are the implications? Where should we look to next to further explore this theory

• Material technology like HTTP operates the web; non-material technology like 'politeness' operates our social interactions.
• Social technology refers to 'technologies' that were intentionally designed to help with the functioning of systems at scale, e.g. currency, law, and government. Social technology forms everything from household logistics to complex market-state arrangements.
• Social technology directs people to take certain actions that positively benefit society, reducing coordination costs, creating better cooperation mechanisms, and so on.
• Social technologies can be examined on an individual, institutional, and societal level:
• Individual - things like having high trust are taken for granted but are essential to the way our societies can run without sizeable government intervention, surveillance, etc. Low trust societies feature rampant crime and an inability to coordinate properly. Individual social technologies include even mundane things like adhering to queues, dress codes, attending appointments on time, and so on.
• Institutional - advanced social technologies reduce coordination costs and make institutions more effective to achieve their purpose.
• Societal - a society without social technology is the Hobbesian war of all against all, where only individuals can accomplish things but this cannot scale. This is an important distinction; "backward norms" in many places are not responsible for deviation from "a peaceful state" because our default state is not peace and progress. These things must be designed. "Backward norms" are designed social technologies that are very expensive ways of dealing with problems. As such, the goal here is to upgrade these social technologies and reduce costs - and this can only be done by design.
• Social technology is also symbiotic with material technology; a decline in the former leads to a decline in the latter.

• Monasteries are some of the longest-lived institutions ever created. Why? In this video, Samo describes the potent mixture of social technology that produces this remarkable longevity. Watch here.
• In this clip, Samo explains the relationship between technology and politics, why all material technologies are necessarily social technologies, and how people working in tech should think about politics. Watch here.

• Common wisdom is that technology disrupts society; actually, often society is a designed system that changes with planning and disrupts technology
• People only know how to use most technologies when they are embedded in larger social contexts, hence social technologies are necessary to use material technology. It reproduces itself through instruction or imitation. We accept or reject technology together as a society.
• Inventions on their own are useless, i.e. for the tinkerer's delight. Inventions only achieve adoption when it has a stable socioeconomic niche, e.g. the archetype of blacksmith even if blacksmithing is no longer common. Embedded technology can outlive civilizations
• Much of technology is only feasible at scale (eg highways, laptops, smartphones) so society needs to be socially engineered, at scale, for mass adoption of this technology.
• Industrial Revolution required discipline to use new machinery: a social technology learned from prisons and militaries and taught to factory workers. The Fordist Factory as the institution that defines all modern institutions.
• Productive capacity (e.g. innovation) decreases from lack of use (eg peacetime vs wartime) so social tech is used to create constant consumers. Mass marketing as a social technology to enforce adoption of technology at scale is one of the US's greatest strengths. E.g. to justify producing more cars, you have to teach people how to drive, where to drive to, invent places to go, build highways, etc. Consumption isn't just an economic act but an integral element of the American political and social order; without mass marketing for consumption, the American machine stops.
• Organizations become hostile to innovation because committees purport to decrease risk but increase it by 'failing at core mission', social not economic aversion to being disruptive/innovative.
• Functional institutions easier to build if specific measure of success or specific goal exists (eg NASA when putting man on the moon, Manhattan Project).
• Power centers benefit from lending power to achieve technical goal (eg US gov co-signing NASA's work).
• NASA today more focused on maintaining prestige than any specific goal --> decaying bureaucracy, dead player. Live players like Musk bypass bureaucracies and leverage social engineering tools to justify their ends and manufacture demand (eg SpaceX and tesla making engineering 'cool' again)
• Social engineering of the Industrial Revolution undermines the creation of new technology because it eliminates outliers and automates the assessment of merit at scale.

• Social Technology: 'technologies' that were intentionally designed to help with the functioning of systems at scale, e.g. currency, law, and government. Social technology forms everything from household logistics to complex market-state arrangements.
• Social Engineering:

• Is the assumption that social technologies are engineered, not emergent, correct? What is the correct balance to be struck here? Samo believes Great Founders design a system from which an emergent order/evolution then occurs.
• How can the vast Muslim traditions and Islamic civilisation's various phenomena be interpreted in light of the identification of social technology as a driving force for the adoption of material technologies?
• How can we identify, build, and embed social technologies in our communities today? What social technologies do we desire, and toward what ends are we building them?
• Samo describes social technology, but not the processes behind the creation of particular social technologies?
• Samo describes loss of knowledge, but how to identify what knowledge has been lost? What's a cost-effective way of reducing these costs? Can we quantify this loss of knowledge? Burja says its impossible to quantify knowledge - you don't know what you don't know. One way to solve this is successor issue - founders pass on intangible knowledge.
• Equity > a social tech. The 20% fee of asset management firms is from the Phoenician trade system.

• A tradition of knowledge is a body of knowledge that has been successfully worked on by multiple generations of scholars or practitioners.
• E.g. a philosophical school of thought, rituals in a religion, how to woodwork, how codebase works, etc.
• 3 types of traditions of knowledge:
• Living: a body of knowledge successfully transferred to people who understand it and/or founders are still alive and practicing. The content of the tradition's body of knowledge doesn't need to be fully accurate but must be passed on.
• Dead: knowledge unsuccessfully transferred, as external form is passed on, but full understanding of how to practice this tradition is not. A tradition can be dead even if ppl still read its texts.
• Lost: knowledge that has not been transferred at all, lacks any successors, or substantial record of knowledge.
• There can be traditions within traditions and knowing whether a tradition is alive is important to determine whether you can trust the authorities of said tradition.

1. Transfer of verification methods: experts will verify work for accuracy, a form of quality control that evaluates new work in a tradition of knowledge against reality. E.g. internal performance reviews in the office, oral exams at university.
2. Transfer of mechanisms for correcting transmission errors: experts check new work for consistency with previous work in tradition and proactively correct them.
3. Transfer of generating principles: passing on the principles that created the tradition in the first place so that it can be later extended. E.g. generating principle includes techniques for theorizing like the process of deductive reasoning.
4. Explication of generating principles: most first principles of a tradition of knowledge are passed on implicitly (i.e. are intellectual dark matter) bc they're too hard to put into words. however, attempting to articulate them explicitly and pass this on is beneficial
5. Production of masters: living traditions produce masters of their tradition who unlike even teachers or mere experts, are able to preserve, understand, extend, or reconstruct a tradition as necessary
6. Production of reliable teachers: living traditions produce more teachers than masters, who are able to solve the problem of counterfeit understanding
7. An institution: living traditions of knowledge require an institution that will maintain and repair it, with a great founder, solution to the succession problem, live players, protection against capture. It is impossible to preserve a tradition without preserving the institution responsible for its maintenance.

• Traditions of knowledge are preserved intentionally, as it is easy for them to die.

• Most traditions die or are lost because of the following problems:
• Counterfeit understanding: students can seem to understand the tradition without actually doing so, especially if they just regurgitate a teacher's thinking without understanding. Some types of knowledge like introspection are especially vulnerable to counterfeit understanding.

• Like dark matter in the universe, we cannot see most of the knowledge that created our institutions; trade secrets, tacit technical knowledge, social networks, persuasive skills, private collaboration and letters, etc.
• This intellectual dark matter is foundational; fraction of intellectual dark matter is probably more important than the sum of public information.
• Over time, much of this matter is lost and can never be recovered. Institutions dependant on lost knowledge run on autopilot and eventually collapse.
• There are three types of dark matter: lost, proprietary, and tacit knowledge.
• Lost knowledge: knowledge becomes lost when the tradition of knowledge maintaining it ceases to exist. The Renaissance occurred because scholars unearthed and attempted to understand the lost knowledge of the ancients, and this effort in turn produced the foundations of western thought in politics, law, culture, etc. Yet even the ancient's thought was in continuation with what came before, knowledge we don't have. The foundations of our foundations of religious, cultural, and political institutions are lost to time. Knowledge lost today includes technological knowledge such as NASA rockets where the makers are dying and the knowledge of their inner workings aren't fully maintained in documentation.
• Proprietary knowledge: the use of which is restricted by an institution guarding its monopoly. Companies like RenTech operate highly secretive environments and a culture that disincentivises interaction with the outside world. Proprietary knowledge can also be held in networks, i.e. professional, such as in law or spycraft.
• Tacit knowledge: knowledge that has not been transmitted in written form. Most practical knowledge is tacit and is the most widespread form of knowledge because practice is easier than theoretical learning. Master-apprentice relationships are the gold standard for the transfer of tacit knowledge. Tacit knowledge ranges from the taxi driver's simple understanding of roads and driving to the statesman or engineer's intricate tacit knowledge of their fields.
• Video: There exists knowledge developed and used by historical civilizations that we can infer has been lost to the ages, but nonetheless shaped the trajectory of future civilizations to come. Watch here.

• During civ collapse, no organization can hide behind another, as all are dysfunctional. Widespread collapse presents an epistemic opportunity to uncover the social technology that sustained society.
• E.g. Zhou Dynasty of ancient China arrested and studied its own decline, birthing Hundred Schools of Thought, incl Confucianism, Legalism, Taoism.
• West relies on scientism, where scientific claims describe the functioning of society without empirical evidence for the application of their validity, even though our society is not scientifically planned and few know how it operates.
• Collapse happens slowly then all at once, as institutions decay.

• Bureaucratization: fragments knowledge, misaligns talent, increases info asymmetries, and makes politics more predictable. It also increases compartmentalization, which makes it more difficult to achieve the original task of an org.
• Institutions are part of an ecosystem of other Institutions and non-functional Institutions are the rule, making it difficult to determine their originally planned design or purpose
• The loss of social technology enables a failure to transfer traditions of knowledge to successors. This becomes the rule in dysfunctional societies and the constant loss of capabilities yield civ collapse. Succession failure is opaque to recognize, but widespread.
• Civilisational collapse: most recognizable large institutions vanish, material wealth decreases, complexity of material artifacts and social forms decrease, travel distance and physical safety of inhabitants decrease, and knowledge massively reduces
• loss of knowledge is most damaging as it speeds up decline of other things
• Lack of documentation and our arrogant dismissal/loss of knowledge of social tech of the past means that we have difficulty understanding the achievements of the past.
• E.g Stonehenge was made by 'aliens' bc we can't fathom how humans could've had superior tech than us
• Material tech rests on social tech, only small scale material tech like agriculture and metallurgy can survive collapse because the social tech needed to sustain them can arise organically.
• Dark Ages are always preceded by Intellectual Dark Ages. Knowledge of social tech is compartmentalized to a few, those who could recognize the absence of social tech have passed, those who remain are role-playing, and no one is able to create new social tech, meaning civ collapse comes as a surprise.
• We may be in the midst of a civ collapse in the West, as our society still relies on the tech of the Industrial Rev. We are post-industrial but not in a positive sense. It may be possible to reverse the US's decline, given its ability to attract talent, but engineering the appropriate social tech is difficult. Until then, China will become the world's leading ecoonomy.
• Need to create a socioeconomic niche for those who can socially engineer society and revive a techne of civ: the skill of managing the institutions of a society and culture.

• Tradition of knowledge: a body of knowledge that has been successfully worked on by multiple generations of scholars or practitioners.
• E.g. a philosophical school of thought, rituals in a religion, how to woodwork, how codebase works, etc.
• Intellectual Dark Matter: like dark matter in the universe, we cannot see most of the knowledge that created our institutions; trade secrets, tacit technical knowledge, social networks, persuasive skills, private collaboration and letters, etc.
• Bureaucratisation:
• Techne:

• Some institutions perform all others by an order of magnitude; exceptional institutions exist, and they are rare.
• Most institutions maintain a coordinated competence barely above the level necessary to exist; many institutions persist for a long time despite failing at their formal purpose. Unprofitable companies and declining nations often last longer than their critics remain solvent.
• Functional institutions are not spontaneously generated, but put together with good judgment at the start by their founders. A tornado can't put together a Boeing.
• It is much harder to make a dysfunctional organisation functional than to build a new functional organisation, as diagnosing dysfunction and navigating internal forces that resist change is hard. A talented founder can do it, but the cost tends to be far higher than building their own organisation.
• Thiel's law: founders best chance at making a successful institution is to get it right from the start.

• Most seemingly functional institutions don't pursue their formal goals effectively but spasm ineffectiviely in its general direction.
• Many institutions are no more than social clubs for their members; the institution exists to satisfy their social needs. Even this fails as bottlenecks in information, communication failures, power struggles, haphazard specialization, etc, all doom institutions.
• Optimizing people's roles with natural hierarchies would spell success, but most institutions avoid this.
• Efforts don't compound but accumulate linearly, resulting in weak optimisation. This is good enough for a baseline level of existence but nothing exceptional.

• Order can be dysfunctional as a machine may be poorly designed based on faulty assumptions or incomplete knowledge, or it can be unlucky; wrong place, wrong time.
• An outgrowth of impressive order without impressive results is often deception, although some results aren't obvious at the start (Musk and Tesla).
• This deception can be maintained by charismatic people or a smaller, coordinated deception to maintain outside appearances over internal functionality, e.g. types of legal compliance, party lines, PR strategies, etc.

• Successful planning is the exception, not the rule. Planning is considering actions in advance and improving the entire sequence. Most fail to plan because of lack of time, desperation for social survival/conformity, trouble delaying gratification, etc.
• Plans are often just agreed-upon lies, solving immediate political problems and not mapping future actions; they are exercises in persuasion, not engineering.

• Not knowing how people will act adds to our coordination costs, i.e. uncertainty in our planning. To increase predictability, we simplify our behavior to act off a script, e.g. professionalism, courtesy, law-abiding, virtue.
• Communities that uphold these well do much better than those that don't. Different societies have different standard levels of trust between members (trust reduces coordination costs).
• Costs are also reduced by self-sorting: interacting with those who most resemble us or by standardization, eg: schooling or rewarding conformity.
• Imperfect models about others + poor communication = uncertainty about behavior —> low trust —> conflict = poorer functioning institution.
• Enemies can also dress themselves as allies to avoid our assumptions of ill intent.
• Epistemically sound collaboration is rare because of how costly it is to figure people out, so most functional institutions are the work of a few individuals, not large, cooperative groups.
• Great founder bypasses these limitations to produce a functional machine that can then self-improve beyond a founder's design (iteration). If exceptional institutions are anomalies, its founder is a greater anomaly.
• Great forces are perhaps only unleashed by particular great minds - 'great minds history' provides a prophecy; those who find secrets, i.e. correct and special knowledge about the world, and can plan, possess the building blocks of the next great machines.
• Videos
• Exceptional institutions are rare. Because of their functionality, they’re quickly imitated by other organizations in a given society. But we shouldn’t underestimate the rarity of a brilliant founder and functional institution. Watch here.
• As organizations grow larger, they often find it difficult to retain the energy and effectiveness of their early days. In this video, Zack Lerangis explains the new challenges any organization must face during its rise. Watch here.

Epistemics

• They have outwardly visible signs, which may suggest one thing but actually indicate another
• One thing we want to know about institutions is whether they’re succeeding or failing, or on track to succeed or fail.

Features of institutions

• They therefore will have a degree of successfulness at accomplishing those purposes
• “Discerning whether an institution is near failure is a difficult epistemic problem”

• It would also not be improper to say that institutions have *abilities* or *functions*.
• A basketball player has the purpose of winning basketball games. His abilities might include dribbling, shooting, defending, complying with NBA rules, etc.
• Likewise a military has the purpose of winning wars in an efficient manner. Its abilities or functions might include moving troops around, recruiting, maintaining morale, training, obtaining a strategic understanding, etcetera.

• Institution A may be functional at t1 and dysfunctional at t2. It might also be functional on dimension X/with respect to task or challenge X, and dysfunctional on dimension Y/with respect to task or challenge Y.
• “Decay is in fact the rule: the maintenance of old institutional abilities is difficult, and the growth of new ones is rare”
• Samo sometimes uses the term ‘health’ to refer to functionality or the ability to fulfill a purpose.

• “From these signs, it’s possible to discover whether an institution has the ability to face new threats, or is merely trudging through a slow process of decay. If an institution is unable to adapt to meet new challenges, it will lose again and again.”
• Institutional health is connected to the idea of being flexibly adaptive to new circumstances.
• This implies that it is useful to look at the institution as having an environment that poses new challenges and stressors as the institution attempts to accomplish its purpose.
• The accomplishment of the institution’s purpose may consist in the transformation of its environment, which requires not being defeated by that environment, whether by natural or human forces.
• E.g., agriculture is performed by a variety of decentralized farming organizations and institutions, as well as monitored and managed by governmental actors and so on. The overall purpose of agriculture is to keep people fed; it may be defeated in its purpose by natural phenomena, like a global ice age where we all starve to death.
• E.g., a military may be frustrated in its purpose of winning wars by an opposing military which has a contrary purpose of conquering your military; thus it has been defeated by a part of its environment which is human and institutional in character, rather than natural in character.

• Overall, we are given a picture in which institutions have proceduralized functions, which are relatively fixed and inflexible, surviving institutional decay (loss of the core of institutional vitality) longer than un-proceduralized parts of the institution. As the environment imposes challenges on the institution, the ability to innovate new solutions distinguishes the sort of institution which is expected to die or to adapt. Absent adaptation, the institution may die.

Proceduralization

• Example: getting your driver’s license at the DMV
• When this process accretes to a substantial degree, you might call that ‘bureaucratization’
• “bureaucratization is proceduralization”
• Proceduralized ≠ ‘bad’ or dysfunctional. In fact the purpose of proceduralization is to increase function.

• Institutions’ tasks come in two types: 1) Proceduralized 2) Not proceduralized

• … may be automated
• … are executed in a rigid manner
• (Because this aids automation and lets them be done more reliably)
• … may therefore be robust to decay
• “Such systems can persist, and even fulfill their function, while the core institution itself is failing”
• … may consist of a significant portion of the tasks executed by a mature organization.
• … may be effective, at the cost of fragility.
• … involve reducing generalized human intelligence to the execution of a procedure.
• ‘Human intelligence’ is useful for the solution of ‘problems-in-general’, rather than narrower tasks that you can proceduralize; intelligence enables context-dependent tweaks and changes, more appropriate to a specific circumstance, but less scalable.

• ...makes change (and therefore adaptation to new problems) difficult
• The text explains this as being caused by the nature of proceduralization.
• Proceduralization makes deviation difficult - by intention.
• … increases the cost of altering the organization, by an employee
• Employees also need to have knowledge of how to adapt.
• … induces incentive and responsibility schemes, to cause adherence to the procedure
• These schemes themselves can mean that not following procedure can cause punishment or ostracization.

Institutional decay

• Employees act on procedure to complete their tasks, rather than acting on the principles by which the procedures were put in place, and on which the institution was built.
• Therefore, they learn the procedures, rather than the principles. They will then be unable to apply the principles to adapt to new situations.
• This state of affairs means that knowledge of ‘what is needed, beyond just playing your role’ naturally fades with time.
• “Over time, this incentive structure will result in a bureaucracy with no remaining understanding of the principles which generated it”
• You get a system that persists through time, resists and possibly even punishes change, assailed by changing circumstances and which is unable to adapt to them.

• Function must be maintained, and sometimes increased, for the institution to succeed.
• “Decay is in fact the rule: the maintenance of old institutional abilities is difficult, and the growth of new ones is rare.”
• It seems like there’s a background assumption of entropy, absent human intervention.
• In other words: someone needs to actually do these tasks, or they don’t happen.
• Note: it seems like maintaining old abilities and growing new ones is itself a key ability common to all functional institutions that persist over time.
• “That systems of incentives aren’t self-preserving results in a kind of erosion, as resources are extracted and minor things changed here and there at the expense of the institution’s functionality.”
• People ‘borrow from’ the fundamentals in favor of local interests or other incentives.
• Unnecessary parts become bloated while fundamentals are starved of resources.
• No institutional quine:
• “In computer programming, there is a kind of program called a quine, defined as a program that takes no input and as its output produces its own source code, replicating the code perfectly. There is no such thing as an institutional quine, a self-contained institution that with no inputs perfectly replicates itself.”
• Politicking as another source of decay
• “This is the fundamental problem of bureaucracy: a system devoid of human judgement and oversight results in constant politicking, and constant politicking results in decay.”

• The institutional may shamble along and even continue to gain wealth or employees, despite losing all adaptability and agility.
• “In this way, a powerful institution can be brought down by changing circumstances or even external attacks which it cannot adapt to. For example, major newspapers are still struggling to adapt to the internet and the subsequent rise of online news. They have not recovered their previous profitability or effectiveness at shaping opinion.”
• In contrast to the ossified institution, the founder may have the flexibility that surpasses the (perhaps once-flexible) institution they built.

Assessing institutional health

• Illusory signs of institutional function
• “... if one wants to determine whether an institution is failing, one must discover which features of an institution indicate the current health of the core organization itself, while carefully distinguishing these from features reflective of past health, or support from outside institutions”
• There are many appearances of function, that may merely be signs that the organization e.g. being functional enough to be funded.
• Agreements with the outside:
• Systems making some part of the institution work, which aren’t part of the institution, but rather supplied from the outside
• E.g., a company keeping their lights on; you can keep paying the electric bill, while basically being an automated institution, coasting on proceduralized functions. “That the payments are being made is in itself a weak or moderately strong sign depending on the size of the organization.”
• “If it is using simple contracts to acquire visible resources (such as reliable lighting), do not consider these elements signs of competence beyond whatever competence is needed to acquire adequate funding.”
• These shallow signs may persist until the very end, despite the fact that the institution is dying or long-dead/zombie mode. (And if our goal is to predict institutional behavior/function, we wouldn’t want to be thrown off by this.)
• Another paragraph which I didn’t totally understand, but which would be good to unpack here:
• “If the institution is relying on non-monetary agreements, such as perhaps other institutions being legally required to provide them with a relevant service, you should ask yourself whether the organization could oppose an attack on these services, or at the very least survive, without outside help. Furthermore, could the institution maneuver itself today into having such guarantees, if it didn’t already have them? If the answer is no, this means that the institution has lost an important ability: it can no longer negotiate new deals. That the old deal continues to endure is not strong evidence that the ability to create or even permanently secure the resources on which the institution depends endures.”
• Formal trappings:
• Formal trappings, or reputation, can be hard to set up, but easy to maintain, meaning that the signal of competence may outlive actual competence.
• Once a track record is established, associated status is sometimes maintained by simply not doing new things!
• E.g., NASA remains impressive in the eyes of most, despite the fact that the last moon landing was in 1972.
• Or, the maintenance just doesn’t require the same work as ascertaining the position did.
• E.g,. labor unions maintaining current positions with bureaucracy and law, which they earned in the early 20th c. with violence and extreme hardship.
• “It is much easier to sail a ship, even in choppy seas, than to build a new one from scratch.”
• Formal trappings may sometimes be used to discourage new entrants to a protected area, protecting incumbents. It’s hard to pass the bar, but once you’ve passed it, it’s easy to remain.

• In conflict, even maintaining resources can be a sign of activity, since the assault of the environment or other actors means ‘erosion’ is speeding up, and so maintenance requires activity. Automated processes are easier to disrupt, and relevant resources easier to harvest, if they aren’t actively defended.
• But, considerations to keep in mind: (1) how real is the conflict (2) how big is the besieged org
• Fake competition:
• Cartels. OPEC, Apple/Intel/Adobe/Google, toothless political parties
• Essentially, kayfabe
• “Since such long standing fake conflicts can be proceduralized; they don’t constitute strong evidence of an institution’s vitality. Fake conflicts don’t require much adaptability.”
• (Why don’t they require much adaptability? Would be interesting to have an account of what things are easier and harder for less vital organizations.)
• Organization size:
• If the org is massive enough, it just takes hits, and doesn’t immediately fall, even if repair is not really happening.
• Contrast ‘fighting, self-contained, and young’ orgs.
• Automated competition?
• “A security organization’s ability to launch investigations that find compromising material on their opponent” is given as an example of a core functionality which can be done in an automated way.
• (This makes me want to look into the automation idea even more. What makes this automatable? How could we tell from the outside?)

• Highly peaceful, integrated, and long-lasting institutions may seem like the most stable things around, but maybe they are fully-automated, and “getting by on the health of their environment” rather than their own functionality. It’s noted that “functional institutions subsidize all others”.
• Due to all these factors, institutional failure is often surprising.

• What is an institution
• If it’s organized or founded for a reason, no matter how formally, it’s an institution
• Not: ‘the institution of marriage”
• Bureaucracy as “a machine with human parts”
• Are non-bureaucratic groups institutions?
• A band?
• The Mongol horde?
• Questions
• Defining an institution
• When does politicking benefit the organization? Can it be captured and used in a way that serves the institutional goals?
• Romans going out to conquer surrounding lands, incentivized by returning to have a triumph
• Promoting people who do things that actually benefit the organization, in a company
• If Rome is an institution, who is the founder? Romulus and Remus?
• Maybe this is a case where the ‘founder energy’ needs to be passed down via succession?
• What happens with literally dead founders - the institution can carry on on its own
• Is the HR part of your org an institution as well? (Plausible)
• Institutions shaping people
• Reproducing the type of people who act in the service of the institution (e.g. Romans)
• What’s the ‘live vs dead’ spectrum? Where on that spectrum does that institution start failing?
• Whales don’t tend to die of cancer because they can just ‘take the hit’
• People running the org need to be able to get it to work, despite internal dysgenic pressures
• Napoleon says, ‘a constitution is best kept vague’ - because it’s his tool for running the thing, not meant to bind his hands
• Succession
• Is it ever better to NOT give people the mental models - not truly transmit the founding instinct?
• Will people go off and found their own competing companies?
• Does it lead to fragmentation?

• Live Players (LP): a person or well-coordinated group of people that is able to do things they have not done before.
• LP's have two necessary attributes: tight coordination and a living tradition of knowledge. Tight coordination permits flexibility and responsiveness to go off script and adapt to changing circumstances. A living tradition of knowledge allows for the generation of new tactics, strategies, coordination mechanisms and ideas, producing new, useful knowledge. Usually, for a living tradition of knowledge, there must be at least one LP who plays the role of theorist. Another sign of an LP is that exceptional individuals gravitate towards them; clusters of talent indicate that that LP is exceptional. LP's also tend to conceal themselves to avoid detection and delay response to their moves.
• Dead Players (DP): a person or group of people that is working off a script, incapable of doing new things.
• An LP can die and become a DP if their tradition of knowledge dies and they cannot replace their thinkers or theorists, and/or if their tight coordination is replaced by formal structures (i.e. the transition from a brotherhood of knights to a band of knaves in Tanner Greer's assessment of asabiya applied to corporate structures). An example of a DP is Apple after Steve Jobs.
• Knowing the LvD distinction is important so you can act; offensively, to predict their response to events and whether you replace and/or confront through novel ways (if they're dead), or defensively, to pre-empty live players grab for power. You can also predict the future of society; stagnant societies have few live players.
• An LP is not necessarily exceptional in skill; go-getters are better than geniuses if those geniuses are frustrated and don't take action. To be an LP means to do something new, not to repeat something even if that something is impressive to do.
• Russia is an example of an LP; under Putin, Russia has annexed Crimea, and successfully completed operations in Syria beyond its Soviet 'Near Abroad'. It was able to do these in relatively short time frames. An example of a DP is France; even though its oeprations in West Africa are successful and impressive, France has been conducting such 'bureaucratized action' for a long time, so this isn't enough to be an LP.
• DP's can be revived by an LP, but this is challenging because it frequently involves displacing entrenched power structures. IT is easier to reform a DP from the outside with owned power.

• The succession problem navigates how to ensure that an institution acquires a successor to their founder, who can keep the institution functional and a live player.
• Successfully resolving this problem is possible only through two other successes:
• Power succession: handing off the reins and keep institution piloted
• Skill succession: identifying and transferring the skills needed to keep it alive
• If 1 happens without 2, then the institution stays piloted, but not a live player (ie: someone is at the driver's seat, but doesn't know how to drive). Either the car crashes OR the driver intervenes minimally and lets the institution run on auto-pilot (while defending his ability to direct it) OR a more skilled driver takes over
• If 2 happens without 1, then the institution becomes unpiloted and a dead player until a skilled person takes over. Mismanagement and bureaucracies make it hard for the most skilled people to get the most powerful positions.
• People convert the power lent to them in a bureaucracy from borrowed power to owned power and pursue their own agendas over the institution's agenda. This makes it difficult for the institution to be functional and makes it easier to start a new institution than to gain control of an unpiloted one, which may remain functional for a time, before decaying.
• Creative destruction is not necessary for innovation. Disruption is only good if it isn't possible to cooperatively change an institution and is a sign of poor institutional health. The fact that we celebrate such destruction reflects that we have become used to failed succession and dysfunction.
• Transferring skills without transferring power leads to conflict, as ppl with high ability and ambition will dismantle institutions that they couldn't work with.
• Functioning institutions have intellectual dark matter that cannot be liquated. Thus, when an institution dies, this knowledge dies with it.
• Dying institutions yield instability for those who rely on them. On a company scale, this means an abandoned company town (see Detroit) and on a civilizational scale, this means societal collapse.
• Resolving the succession problem means less of a trade-of btwn stability and innovation. Most use social technologies to achieve this.
• Flourishing civs have lots of functional institutions, with great founders who birth new social designs. We need to balance our taste for political and economic competition with appreciating successful succession.

• Functional Institutions:
• Non-Functional Institution:
• Live Player:
• Dead Player:
• Power Succession:
• Skill Succession:

• One of the main insights in Samo Burja's work is his idea of functional vs non-functional institutions, and that the latter is a mere imitation of the former that can achieve some limited, superficial success but cannot achieve the fundamental transformations capable by the former. Key to this is the understanding that:
• Great Founders found functional institutions
• Functional institutions spawn a range of social technologies to facilitate social order (by lowering coordination costs and improving cooperation), and to facilitate adoption of material technologies (to improve material conditions)
• Much of the charity work undertaken by Muslim organisations largely falls into the category of non-functional institutions. While they achieve limited success in some areas, i.e. temporary alleviation of hunger or thirst, often based on the fund-raising season (ie Ramadan etc), they do not really operate as functional institutions which are responsible for the creation of social technologies that can fundamentally change the wider material reality of a people and fix the problem entirely, ie in this case hunger and deprivation. Another example is orphanage services which attempt to place orphans with new families. They have limited success in that they can often successfully place an orphan with a family, but they are not a functional institution as they have not spawned a wider set of social arrangements that largely eliminate the problem in itself; i.e. in an ideal society, the mechanism that sees an orphan quickly taken in by a family without much problem and absorbed into the social order such as they lose their status as "orphan". They merely act as a sort of middle man for the problem, therefore being non-functional institutions.
• When considering the creation of institutions, we have to ask ourselves:
• Is this a functional institution? I.e. is it created for a specific purpose, to provide a solution such as social technology Y to social problem X?
• If it isn't functional, it's a non-functional institution in that it achieves a limited metric of success, but doesn't fundamentally resolve the underlying issue?
• If (2) is the case, what are the opportunity costs and are there diminishing returns in putting in the work to bring this institution together and running it? Is it more trouble than it's worth?
• 'Successful nonprofits are forgotten to be nonprofits. If your nonprofitable goal succeeds it becomes a societal institution and you generate your own whole new vocabulary for support and mission.' (source)

• Power is the ability to realise your will, affect the world in ways which you desire, and achieve your goals. There are two types of power: borrowed power, and owned power.
• Borrowed power (BP): power conferred to you which can be taken away.
• Owned power (OP): power that cannot easily be taken away, including: resources, skills, personal relationships, and knowledge.
• BP vs OP is contextual and operates on a spectrum; a middle manager has OP versus lower employees, but BP versus the CEO.
• OP is better than BP if you have long-term ambitions, as OP allows you to maneuver around unexpected developments and new information (OP is related to being a live player).
• Gaining employment is one way of achieving BP. BP can be acquired through OP; specialised technical expertise and persuasion skills are OP's that can be used to secure a job.
• When power is conferred, an information asymmetry exists between lender and borrower. The goal of the borrower is to exploit information asymmetries to achieve OP. This makes borrowing and lending power adversarial.
• Persuasive skills and personal relationships are similar forms of OP, allowing you to convince people to do what you want them to do. Personal relationships can also convert BP into OP (e.g. working somewhere and then jumping ship with other employees to start your own business).
• Holding special information about the field you are navigating is another form of OP. As we develop our knowledge, we eventually come to form a good epistemic standing at which point we can overthrow the intellectual authority and replace them.
• Skills can be strategic or operational: strategic skill entails knowing something can and should be done, without knowing the steps to make this happen. Operationalised knowledge is where they have the steps but not the strategic picture. OP can be gained by strategic trading with operational.
• Resources are acquired because of skills, personal relationships, or knowledge, which all exist in a virtuous cycle. They need each other.

• Studying the field of competition by analysing competitors and the nature of the competition makes it possible to craft a winning strategy. Understanding their behaviours reveals their plans, goals, and next moves.
• There are two reasons for the Pareto principle in skill distribution:
• Completeness Hypothesis: having 100% of the parts produces a different effect to having just 90% of the parts (non-linear scaling). To achieve mastery in a domain, you need good feedback mechanisms, extreme motivation, right equipment, and sufficient time.
• Efficacy Arms Race Hypothesis: you need relative, not absolute skill in a competitive domain to beat your competitors. Different environments require different skill levels.

• Moderatedly skilled and ambitious people flocked to the few resource dense locations and major domains of competition, e.g. finance in NYC, tech in SF, politics in DC.
• The few with very high skill congregate in unoccupied areas offering owned power, which cannot be easily taken away. Owned power is strategically superior but these areas are difficult to find, hence only high skill people will find it. Owned power is sought for its versatility - it can be deployed for nearly any strategic aim.
• Gaining power is dirty and doesn't happen in well-established prestige centres. It takes a lot of work to find it - and people who are competing there are attempting to conceal it.
• Because they are unoccupied and little known, areas offering owned power witness lawless and vicious competitions.

• There are two types of action in competition:
• Unlimited action: competitive actions that do not stick to the rules, often perceived as "cheating".
• Limited action: competitive actions that stick to the rules.
• 4 ways in which a player's competitive actions can be limited:
• Some actions can be monopolised by one player and denied to others, e.g. governments monopolising violence.
• Insufficient skill may bar a player from employing proxy warfare as they are not skilled enough to execute a sophisticated play.
• Unwilling to consider actions deemed off-limits due to unfeasability or simply not thinking to look there.
• Competitive action can be limited by personal incentives. Actions taken to achieve particular goals may cause problems for broader goals (e.g. tactical victories but not strategic victory).

• Empire Theory is a framework for understanding and practicing competitive strategy. Competitive strategy is the art of defeating opponents. Once you have chosen a domain of competition, good competitive strategy enables you to win.
• Competitive strategy requires understanding how actors behave based on their position in a strategic landscape, which serves two purposes:
• Recognising patterns of players allows you to infer a lot from little evidence
• Allows you to craft your own competitive strategy by predicting, planning for, and responding to behaviour

• A group of coordinated actors that operate around some central power.
• They use discernible mechanisms for coordination to align actions and achieve particular goals.
• They usually have some sort of central power to maintain coordination, e.g. the employees and CEO, civil service and President, or the Muskiverse and Elon Musk.
• Empires are further composed of:
• Players: individuals with enough power to be relevant to the functioning of the empire
• Resources: assets drawn upon for the empire to function; e.g. physical resources, money, information, personal relationships, and coordination mechanisms
• Fractal empires: empires exist within empires, allowing for a fractality of coordination mechanisms; this can be identified by:
• noticing group coordination, or;
• identifying a coordination mechanism, then identifying actors around that mechanism
• The problem of local focus:
• The dynamics of the central empire have outsized effects on the other sub-empires, and its control yields control of the rest of the empire.
• Allocation of resources to control of the central empire detracts from the rest of the empire and hurts expansion. This is due to political necessity, so is always a drag on expansion.
• The larger an empire is, the greater the problem of local control as more skilled players flock to the centre and compete for power.
• Ask whether an inexplicable move or event is best explained not by the wider imperial dynamics and interests but those of the central empire; global moves have their origins in local problems.

Power classes:

• Different actors in an empire have different levels of power. These power classes are fractal; the same actor can be high, mid, or low depending on their position. A parish priest in his community is high, but in the wider Church structure, low.
• High: the central power that defines an empire's zone of coordination and is often the central empire in itself; an empire can't exist without high powers who are responsible for distribution of resources and coordination
• Medium: those with sufficient power to challenge high's control, and play a role in constraining higher actions. Mid powers form various sub-empires, rarely coordinating as a single sub-empire. Coordination requires more resources and effort at this level than at high.
• Low: those with sufficient power to challenge mid but not challenge high. They have the largest population and least power and rarely forms a united sub-empire.
• Anything below Low is outside, i.e. not coordinated by High and therefore not in the empire, or they are resources, used by high, mid, and lower players to accomplish objectives.
• In America, High is key federal agencies. Mid are heads of major institutions: large companies, banks, unviersities, state governors. Low are state officials, local group heads, and smaller organisations. Everyone else is a resource. Outside consists of foreign powers like China, Russia, etc.
• Strategic landscapes:
• Strategic landscape: a domain of competition among players.
• Domain of competition: a region where players compete for scarce resources (see ch. Competition for Power).
• Trying to analyse a strategic landscape without specifying a domain of competition yields confusion and error as ends and means cannot be distinguished and actions become ambiguous.
• Tracking industrial capacities in a region reduces predictive power if you are not keeping track of factories alignment through owners, states and oligopolies and therefore understanding the domain of competition. Accumulation of facts without analysis (i.e. knowledge of the domain) will show functioning of some systems but fail to predicts change in these systems.
• E.g. analysing the social justice movement without specifying a resource they are competing for just gives you a list of beliefs and media events. You need to identify a definite conflict point, overall strategic aims, and position.
• Empires are always domains of competition - people are always competing for power in it.
• Domains tend to be empires - almost always having coordinating mechanisms binding competitors together (e.g. oil industry cos coordinating against clean-air legislation).
• Landscape: a useful metaphor to think about domains of competition, as the terrain of a strategic landscape is determined by competitors and relative power. The landscape is dynamic as terrain shifts with the flow and ebb of players gaining or losing power.
• Actors exhibit common patterns of behaviour which make it possible to identify consistent and recognisable actions, e.g. patterns of interaction between high and mid players.

• The Dynamics of power:
• Convergent instrumental good -
• Power's use in accomplishing a broad range of goals means that people who are more effective and with a better understanding of reality are more likely to pursue power to achieve their goals.
• Those aligned on ultimate goals may still compete for power if they disagree over the means. Also, those not aligned on ultimate goals may still coordinate together to achieve power.
• Missing the usefulness of power makes you miss out on potential coordination with the powerful, and failing to protect yourself from competition from those seeking power.
• Tl;dr you must recognise the usefulness of power and how to compete for it. You're either predator or prey.
• Pareto-distributed - the most powerful players in society are orders of magnitude more powerful than all other players.
• Competitive reality of nature - power is a scarce resource so everyone is in de-facto competition against everyone else for this scarce resource.
• Difficulty of coordination - difficult to organise large numbers of people.
• Insufficiency of inherited models - people have the wrong or contradictory models of the world; e.g. committees are useless, but people still promote consensus decision making.
• Deceptive side of society - society lies to hide competition, e.g. university entrance.
• Dynamics/Interactions of power classes

• Borrowed power (BP): power conferred to you which can be taken away.
• Owned power (OP): power that cannot easily be taken away, including: resources, skills, personal relationships, and knowledge.
• Completeness Hypothesis: having 100% of the parts produces a different effect to having just 90% of the parts (non-linear scaling). To achieve mastery in a domain, you need good feedback mechanisms, extreme motivation, right equipment, and sufficient time.
• Efficacy Arms Race Hypothesis: you need relative, not absolute skill in a competitive domain to beat your competitors. Different environments require different skill levels.
• Unlimited action: competitive actions that do not stick to the rules, often perceived as "cheating".
• Limited action: competitive actions that stick to the rules.
• Empire Theory: a framework for understanding and practicing competitive strategy. Competitive strategy is the art of defeating opponents. Once you have chosen a domain of competition, good competitive strategy enables you to win.
• Empire: a group of coordinated actors that operate around some central power.
• Power classes: different actors in an empire have different levels of power. These power classes are fractal; the same actor can be high, mid, or low depending on their position. A parish priest in his community is high, but in the wider Church structure, low.
• Strategic landscape: a domain of competition among players.
• Domain of competition: a region where players compete for scarce resources (see ch. Competition for Power).
• Landscape: a useful metaphor to think about domains of competition, as the terrain of a strategic landscape is determined by competitors and relative power. The landscape is dynamic as terrain shifts with the flow and ebb of players gaining or losing power.