Clayton Christensen on Religion and Capitalism

Question: Why is there such a crisis in business leadership?

Christensen:    Can I just maybe make two provocative comments, which are not that provocative but I really believe that they’re true.  There is a fellow that came to Boston about 10 years ago who is a Marxist economist from China and he’d gotten a Fulbright Scholarship.  And he came to Boston to study capitalism and democracy of all of the arcane topics.  We got to know him very well while he was in Boston, so at the end of his time, we invited him and his wife and child to our home just to have a goodbye dinner.  And I asked him, “So of all the things you learned about capitalism and democracy while you were here, was there something that was very surprising to you that you just did never thought about before?”  And with no hesitation, he said, “Yeah.  I never understood how critical religion is to the functioning of free markets and democracy.”  And I’d never put these things together before but it’s like this guy flies in from Mars and this is what he sees.  And he said, “You guys are living on cultural momentum that’s actually losing its momentum now.  But if you go back 150 or 200 years ago, almost everybody in America on the weekend went to a synagogue or a church and they were taught there by people who they respected that they should voluntarily follow all the rules, because even if the police did not catch them, God will catch them.”  And so you’ve got to be honest, whenever you make a commitment, honesty requires that you follow through.  You’ve got to respect other people’s property and never take it from them.  Their life and freedom are as just as valuable as yours.  And he said, “Because most Americans most of the time have voluntarily followed the rules, democracy works.”  Even if the police don’t show up on your doorstep to beat you up, you pay your taxes, because we’re conditioned and the root cause was it was our religion’s that instilled in us that ethic.  Now, he said, you just look around the world where America has gone into a country and just snap its fingers and said we want democracy right here and we want it right now, if you don’t have a foundation of a religion there and you said it’s not any religion, that it’s got to be a religion that teaches those particular rules and has enough power over people’s lives that they instinctively follow those rules.  If you try to put free markets and democracy into a country that doesn’t have that foundation, all you get is chaos like Haiti, for example, where they don’t have that foundation, we try to impose democracy and free markets and just get a complete breakdown of social order.  It’s what happened in Russia to a large extent.  So my first concern about our system is that if you don’t have an instinct and generally born from a religious tradition amongst the CEOs to voluntarily follow the rules, capitalism just doesn’t work.  There is no way that you can police honesty if it doesn’t come instinctively for you.  And, you know, I thought a lot about this conversation with that Marxist economist, and as so many institutions in our society try to push religion out of the public eye, what they don’t get is these are the very institutions that gives us our civil liberties in the first place.  So it’s a broader issue than just CEOs, but if the CEOs don’t come with that commitment to honesty, it’s very hard to police it.  It’s very hard to instill it later on.  The second thought is that the economists have done a great disservice to capitalism with this notion that managers are responsible for maximizing shareholder value.  It turns out God did not reveal this to any of the prophets of prophet, but rather economists in the 1800s as they were building mathematical models of microeconomic problems, the tools of economists are calculus.  And calculus forces you to find some function that you can maximize or minimize, and so they began to make assumptions in these mathematical models that management’s responsibility is to maximize the return to shareholders.  And the use of that assumption made the mathematics [tractable].  And so more and more economists began to use that assumption, they’d go into classrooms, teach that assumption and their models to their students.  And somehow over the hundred years or so that intervened, it came to be believed that management is responsible for maximizing shareholders value.  That even has gotten ensconced into some laws.  And then another group of economists came in with this theory called the principal agent theory and the idea there is that the principals who are the managers have a different motivation than the…  I’m sorry, the agents who are the managers have a different motivation than the principals who own the stock.  And so in order to align their motivations, we have to have, we have to give to management a financial incentive to maximize shareholder value.  And so, over the last 20 years, these principal agent economists have so influenced boards of directors that they’ve given the managers of these companies’ extraordinarily attractive financial incentives to inflate the stock prices and so on.  And I think this is just, it’s a broken paradigm.  In the 1960s, the average shareholder held the shares of your company in her portfolio for six years.  Today, 40% of the trading on the stock exchange is done by hedge funds whose average holding period is 60 days.  Fifty-five percent of the activity on a typical day on the stock exchange is executed by mutual funds and pension funds whose average holding period is 10 months.  So, 95% of the volume is executed by people who don’t even hold the shares of your company for a year.  Do you want to call these people shareholders?  They’re not.  They’re speculators or investors who temporarily find themselves owning the securities of your company.  And so rather than the management believing that they’re responsible for maximizing shareholder value, it’s really time to say no.  You guys temporarily find yourself in possession of the securities of my company and you’re responsible for maximizing the returns on your investments and God bless you.  My responsibility is to invest to ensure the long-term health of this company, the prosperity of the employees who work within it and the communities in which the employees live in and which we do our work, and that really is what management ought to focus on doing well.  And this business that managers aren’t incentivized, anybody who knows a manager knows that these are driven people to achieve and to build and to do good things.  And what the economists have done to us by giving this people financial incentive is just really perverted the system.  And so I think if we can get rid of those assumptions that you’ve got a principal agent problem and that managers are responsible for maximizing the income of speculators, if we took them out and brought people who just had a great grounding in the value of honesty because of their background, the CEO problems will disappear.

Clayton Christensen on rescuing free markets.

COVID and "gain of function" research: should we create monsters to prevent them?

Gain-of-function mutation research may help predict the next pandemic — or, critics argue, cause one.

Credit: Guillermo Legaria via Getty Images

This article was originally published on our sister site, Freethink.

"I was intrigued," says Ron Fouchier, in his rich, Dutch-accented English, "in how little things could kill large animals and humans."

It's late evening in Rotterdam as darkness slowly drapes our Skype conversation.

This fascination led the silver-haired virologist to venture into controversial gain-of-function mutation research — work by scientists that adds abilities to pathogens, including experiments that focus on SARS and MERS, the coronavirus cousins of the COVID-19 agent.

If we are to avoid another influenza pandemic, we will need to understand the kinds of flu viruses that could cause it. Gain-of-function mutation research can help us with that, says Fouchier, by telling us what kind of mutations might allow a virus to jump across species or evolve into more virulent strains. It could help us prepare and, in doing so, save lives.

Many of his scientific peers, however, disagree; they say his experiments are not worth the risks they pose to society.

A virus and a firestorm

The Dutch virologist, based at Erasmus Medical Center in Rotterdam, caused a firestorm of controversy about a decade ago, when he and Yoshihiro Kawaoka at the University of Wisconsin-Madison announced that they had successfully mutated H5N1, a strain of bird flu, to pass through the air between ferrets, in two separate experiments. Ferrets are considered the best flu models because their respiratory systems react to the flu much like humans.

The mutations that gave the virus its ability to be airborne transmissible are gain-of-function (GOF) mutations. GOF research is when scientists purposefully cause mutations that give viruses new abilities in an attempt to better understand the pathogen. In Fouchier's experiments, they wanted to see if it could be made airborne transmissible so that they could catch potentially dangerous strains early and develop new treatments and vaccines ahead of time.

The problem is: their mutated H5N1 could also cause a pandemic if it ever left the lab. In Science magazine, Fouchier himself called it "probably one of the most dangerous viruses you can make."

Just three special traits

Recreated 1918 influenza virionsCredit: Cynthia Goldsmith / CDC / Dr. Terrence Tumpey / Public domain via Wikipedia

For H5N1, Fouchier identified five mutations that could cause three special traits needed to trigger an avian flu to become airborne in mammals. Those traits are (1) the ability to attach to cells of the throat and nose, (2) the ability to survive the colder temperatures found in those places, and (3) the ability to survive in adverse environments.

A minimum of three mutations may be all that's needed for a virus in the wild to make the leap through the air in mammals. If it does, it could spread. Fast.

Fouchier calculates the odds of this happening to be fairly low, for any given virus. Each mutation has the potential to cripple the virus on its own. They need to be perfectly aligned for the flu to jump. But these mutations can — and do — happen.

"In 2013, a new virus popped up in China," says Fouchier. "H7N9."

H7N9 is another kind of avian flu, like H5N1. The CDC considers it the most likely flu strain to cause a pandemic. In the human outbreaks that occurred between 2013 and 2015, it killed a staggering 39% of known cases; if H7N9 were to have all five of the gain-of-function mutations Fouchier had identified in his work with H5N1, it could make COVID-19 look like a kitten in comparison.

H7N9 had three of those mutations in 2013.

Gain-of-function mutation: creating our fears to (possibly) prevent them

Flu viruses are basically eight pieces of RNA wrapped up in a ball. To create the gain-of-function mutations, the research used a DNA template for each piece, called a plasmid. Making a single mutation in the plasmid is easy, Fouchier says, and it's commonly done in genetics labs.

If you insert all eight plasmids into a mammalian cell, they hijack the cell's machinery to create flu virus RNA.

"Now you can start to assemble a new virus particle in that cell," Fouchier says.

One infected cell is enough to grow many new virus particles — from one to a thousand to a million; viruses are replication machines. And because they mutate so readily during their replication, the new viruses have to be checked to make sure it only has the mutations the lab caused.

The virus then goes into the ferrets, passing through them to generate new viruses until, on the 10th generation, it infected ferrets through the air. By analyzing the virus's genes in each generation, they can figure out what exact five mutations lead to H5N1 bird flu being airborne between ferrets.

And, potentially, people.

"This work should never have been done"

The potential for the modified H5N1 strain to cause a human pandemic if it ever slipped out of containment has sparked sharp criticism and no shortage of controversy. Rutgers molecular biologist Richard Ebright summed up the far end of the opposition when he told Science that the research "should never have been done."

"When I first heard about the experiments that make highly pathogenic avian influenza transmissible," says Philip Dormitzer, vice president and chief scientific officer of viral vaccines at Pfizer, "I was interested in the science but concerned about the risks of both the viruses themselves and of the consequences of the reaction to the experiments."

In 2014, in response to researchers' fears and some lab incidents, the federal government imposed a moratorium on all GOF research, freezing the work.

Some scientists believe gain-of-function mutation experiments could be extremely valuable in understanding the potential risks we face from wild influenza strains, but only if they are done right. Dormitzer says that a careful and thoughtful examination of the issue could lead to processes that make gain-of-function mutation research with viruses safer.

But in the meantime, the moratorium stifled some research into influenzas — and coronaviruses.

The National Academy of Science whipped up some new guidelines, and in December of 2017, the call went out: GOF studies could apply to be funded again. A panel formed by Health and Human Services (HHS) would review applications and make the decision of which studies to fund.

As of right now, only Kawaoka and Fouchier's studies have been approved, getting the green light last winter. They are resuming where they left off.

Pandora's locks: how to contain gain-of-function flu

Here's the thing: the work is indeed potentially dangerous. But there are layers upon layers of safety measures at both Fouchier's and Kawaoka's labs.

"You really need to think about it like an onion," says Rebecca Moritz of the University of Wisconsin-Madison. Moritz is the select agent responsible for Kawaoka's lab. Her job is to ensure that all safety standards are met and that protocols are created and drilled; basically, she's there to prevent viruses from escaping. And this virus has some extra-special considerations.

The specific H5N1 strain Kawaoka's lab uses is on a list called the Federal Select Agent Program. Pathogens on this list need to meet special safety considerations. The GOF experiments have even more stringent guidelines because the research is deemed "dual-use research of concern."

There was debate over whether Fouchier and Kawaoka's work should even be published.

"Dual-use research of concern is legitimate research that could potentially be used for nefarious purposes," Moritz says. At one time, there was debate over whether Fouchier and Kawaoka's work should even be published.

While the insights they found would help scientists, they could also be used to create bioweapons. The papers had to pass through a review by the U.S. National Science Board for Biosecurity, but they were eventually published.

Intentional biowarfare and terrorism aside, the gain-of-function mutation flu must be contained even from accidents. At Wisconsin, that begins with the building itself. The labs are specially designed to be able to contain pathogens (BSL-3 agricultural, for you Inside Baseball types).

They are essentially an airtight cement bunker, negatively pressurized so that air will only flow into the lab in case of any breach — keeping the viruses pushed in. And all air in and out of the lap passes through multiple HEPA filters.

Inside the lab, researchers wear special protective equipment, including respirators. Anyone coming or going into the lab must go through an intricate dance involving stripping and putting on various articles of clothing and passing through showers and decontamination.

And the most dangerous parts of the experiment are performed inside primary containment. For example, a biocontainment cabinet, which acts like an extra high-security box, inside the already highly-secure lab (kind of like the radiation glove box Homer Simpson is working in during the opening credits).

"Many people behind the institution are working to make sure this research can be done safely and securely." — REBECCA MORITZ

The Federal Select Agent program can come and inspect you at any time with no warning, Moritz says. At the bare minimum, the whole thing gets shaken down every three years.

There are numerous potential dangers — a vial of virus gets dropped; a needle prick; a ferret bite — but Moritz is confident that the safety measures and guidelines will prevent any catastrophe.

"The institution and many people behind the institution are working to make sure this research can be done safely and securely," Moritz says.

No human harm has come of the work yet, but the potential for it is real.

"Nature will continue to do this"

They were dead on the beaches.

In the spring of 2014, another type of bird flu, H10N7, swept through the harbor seal population of northern Europe. Starting in Sweden, the virus moved south and west, across Denmark, Germany, and the Netherlands. It is estimated that 10% of the entire seal population was killed.

The virus's evolution could be tracked through time and space, Fouchier says, as it progressed down the coast. Natural selection pushed through gain-of-function mutations in the seals, similarly to how H5N1 evolved to better jump between ferrets in his lab — his lab which, at the time, was shuttered.

"We did our work in the lab," Fouchier says, with a high level of safety and security. "But the same thing was happening on the beach here in the Netherlands. And so you can tell me to stop doing this research, but nature will continue to do this day in, day out."

Critics argue that the knowledge gained from the experiments is either non-existent or not worth the risk; Fouchier argues that GOF experiments are the only way to learn crucial information on what makes a flu virus a pandemic candidate.

"If these three traits could be caused by hundreds of combinations of five mutations, then that increases the risk of these things happening in nature immensely," Fouchier says.

"With something as crucial as flu, we need to investigate everything that we can," Fouchier says, hoping to find "a new Achilles' heel of the flu that we can use to stop the impact of it."

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