The Scarcity Matrix
“What you know you can’t explain, but you feel it. You’ve felt it your entire life, that there’s something wrong with the world. You don’t know what it is, but it’s there, like a splinter in your brain, driving you mad.” –Morpheus, The Matrix
I am among the last of my generation to see The Matrix. For whatever reason I’d missed it when it came out, late in the twentieth century. It had come up regularly in conversation over the years, but somehow remained on that list of things I should see but likely never would.
Two weeks ago, it became a sudden, urgent priority.
I had been sitting in a National Arts Strategies leadership seminar at the University of Michigan’s Ross School of Business in Ann Arbor. It had already been a powerful few days of provocations and confrontations with many of the basic assumptions underpinning the world of nonprofit arts.
All of a sudden, I had the visceral sensation of a melting away, a fog lifting, a waking up. It was physical and it was emotional. It stopped my breath.
Russell Willis Taylor, National Arts Strategies’ Executive Director, found me at the next break. “Well, that was interesting,” she said. “Did you see the reaction around the room?” I had not noticed. I had been in my own world.
“I feel like I just peeked behind the curtain of something,” I said to Russell. “Like I just saw The Matrix, and I’ve never even seen that movie.”
“Well, you must,” she said. “And be sure and take the red pill.”
I had no idea what she meant but the moment I got home I streamed the movie. And the viewing helped me to make sense of what it was that I was experiencing in that Michigan classroom.
For years I have been thinking about, and talking about (some would say ad nauseum), the feeling I have that we are snatching scarcity from the jaws of abundance. That we live in a time of muchness. That we live, I would even say, in a time of enough, maybe even more than enough, and yet we only experience it as a struggle over scarcity. We approach the world of nonprofit theatre as though we are in a zero-sum universe, where everything I have means one less thing that you can have. We compete for every opportunity like it is the last opportunity there will ever be, sharpening and wielding our competitive advantage like a scalpel, carving as much of the market as we can. Once we start to succeed at this competition we hoard, as though tomorrow we could be out in the cold. Whether it is in endowments or in grants and residencies or in over-booking ourselves with gigs, we take everything that comes our way out of fear nothing else ever will. And for many of us these are truths—there are no opportunities for us; there are no resources coming our way. But rather than question the system and our resulting behaviors, we operate from a sense that scarcity is an immutable law of the universe, like gravity, and selfishness our only hedge against ruination.
We compete for every opportunity like it is the last opportunity there will ever be, sharpening and wielding our competitive advantage like a scalpel, carving as much of the market as we can.
But is it? Fifty years ago R. Buckminster Fuller told us that we already have enough resources and know-how to take care of everyone on the planet at a level unheard of in human development. “It no longer has to be you or me. Selfishness has no integrity whatsoever.” Fifty years ago! And this man has his own US Postal Service stamp. So. He knew a thing or two.
But back to Ann Arbor, and that business school boot camp. We were fresh from a rather aggravating morning session on negotiation that had, in its final fifteen minutes, blossomed into a revelation about rethinking the whole process of negotiation. Shirli Kopelman was asking that we think of negotiation not as something defined by winners and losers but rather as an opportunity to create capital through the coordination of resources. Now, many of you will say you have evolved past the place of treating negotiation as a tug of war. You’ve “never viewed negotiating as a zero-sum game,” you regularly have “gotten to Yes,” you “always meet in the middle,” or “find a win-win every time.”
But what Dr. Kopelman was proposing was much more provocative than any of that. Meeting in the middle, she says, is “lose-lose, not win-win.” She suggests, instead, that we start from the gap between what I have and what you need and build a resource bridge over that gap—looking very expansively at what we have and what we need. That we not let the conversation become boxed in around money. That we figure out how to create value in this negotiation, value that can bridge the gap that money alone cannot, by coordinating all of our available relevant resources. What do you have, in addition to money, that can help me? What do you need, other than money, that I can contribute to the resource bridge? By adding things to the pot, we are accessing the abundant world around us and creating wealth for each of us that would not have been brought into circulation if we hadn’t negotiated.
Wait, what? Negotiating not as a tug of war with winners and losers, but as a process of creating value and unlocking wealth? Negotiation not as a test of my skill at getting, for me, as much as I can from you but as a process of aligning resources for both of us? Negotiation is a process of “resource coordination”? Was I hallucinating? Or, was she?
The session was over too soon for me to ask Dr. Kopelman which one of us was high. I trundled off to the next one, led by another exceptional guide, Paula Caproni. And she launched right into a session on “The Leader as Influencer.” To illustrate the concept of Influence, she began by borrowing a quote from Robert Cialdini’s groundbreaking work with Marketing. Influence, he says, is the “deliberate, systematic process of getting others to support your ideas.” Deliberate. Systematic. Process. Those three words seemed to hang in the air, and echo as if from down a long hallway. A flickering began. Influence is deliberate, it is a systematic process, and it is getting me to do what someone else wants me to do.
To achieve influence marketers use cognitive shortcuts. These are triggers that cut through the natural tendency to avoid making a decision and steer the decider in their direction. We watched this video, which illustrates Dr. Cialdini’s Six Universal Principles of Influence:
- Social Proof
- Commitment and Consistency
The Scarcity Matrix
Right there in the list: Scarcity as a Universal Cognitive Trigger for getting people to act as you want them to.
And the definition of The Scarcity Principle reads “This principle says that things are more attractive when their availability is limited, or when we stand to lose the opportunity to acquire them on favorable terms.” Dynamic pricing works on the Scarcity Principle, as does the whole notion of subscription. “Act now and get the best seats on the best nights for the best price.” Don’t act now, and you’ll get worse seats on off nights for higher prices. Who wants that?
I understand this as a marketing tool. I am not comfortable with the transactional nature of the relationships that result from this marketing style, but I get its effectiveness. But suddenly in this classroom in Michigan, I begin to see we have turned the Scarcity Principle on ourselves and we now believe it is real. We have used the Universal Principles of Persuasion to convince ourselves that availability is limited, that we will lose opportunity—in short, that we are awake in a time of scarcity, rather than asleep in a world of abundance.
We have created The Scarcity Matrix.
There Is no Spoon
This is a time of huge buildings, huge endowments, huge prices, huge box office receipts, huge contracts for consultants in an ever-proliferating array of specialized skills, huge salaries for a handful of leaders, and huge amounts of cash migrating out of the nonprofit realm and right into the pockets of a handful of commercial producers, real estate developers, architects, and banks. There is just too much evidence that we are not living in a time of scarcity. There are more than a billion dollars in “dead capital” locked up in buildings and endowments no longer circulating in the field. How much money have arts consultants like TRG earned from the nonprofit community this past five years telling us how to win a larger share of the scarcity pie for ourselves? How much money has Michael Kaiser made telling us how to thrive in our time of scarcity? How much money have the Weisslers and other for-profit producers made by convincing us that this business is so expensive and there’s so little audience that they can’t afford to produce their products without access to the tax benefits of our nonprofits?
And that is just looking at the picture from the standpoint of money as the supposedly scarce commodity. When you start using Dr. Kopelman’s ideas about negotiation and you delineate all the other resources that could be used to build a bridge over the money gap, however, the true abundance of our time comes into view. Look, for example, at the number of venues currently in operation, the number of units of artist housing in the field right now, the number of training programs, the number of developmental opportunities, the number of props stored in warehouses around the country, the number of unused hours in rehearsal facilities, theatres, shops, and offices. Tally up the amount of expertise that we could be sharing with each other directly, rather than purchasing from outside the commons using money that then leaves our community. Keep going. Keep delineating the resources under our common stewardship and the evidence of abundance simply overwhelms the deliberate, systematic messages of scarcity.
There is a great scene in The Matrix where a child at the Oracle’s apartment seems to bend a spoon with his mind. He tells an astonished Keanu Reeves how it’s done: “Do not try to bend the spoon. That’s impossible. Instead…only try to realize the truth. There is no spoon. Then you’ll see, that it is not the spoon that bends, it is only yourself.”
So, for years I have been dealing with Scarcity as a Spoon, and trying to bend it. But suddenly, this melting and waking and lifting and I realize: there is no spoon. My mind bends. I see the matrix.
“You think that’s air you’re breathing?”
The moment I saw The Scarcity Matrix, I started to try to find the people with their hand on the cognitive trigger. Who or what was behind this “deliberate, systematic, process” and what ideas were they moving us to support? How do I do battle with them? Clearly, like Neo, I thought, “I’m going to need a lot of guns.”
But just as it is in The Matrix, the search for a bogeyman is, ultimately, a red herring. In the film, the “evil machines” are simply the logical extension of conditions created by man that were intended originally to create shortcuts for us through the hard patches. In that film, people became enamored of ever-greater manifestations of artificial intelligence and inadvertently set in motion a process that led to their enslavement by those very machines. What if The Scarcity Matrix is simply the logical extension of everything that’s been done to turn our nonprofit theatres into sustainable businesses through the overuse of the Principle of Scarcity?
We used the Scarcity trigger to corral an audience for ourselves and hang onto them out of fear they’ll migrate to “our competitors in the market.” We adopted the Scarcity Principle to drive generations of artists into MFA factories because, without that credential they’d not be able to compete in the open market for the scarce opportunities available to new voices. We adopted the Scarcity Principle to build the endowments and a competitive advantage in our markets, and tied up that capital forever in the hands of the few, the proud, the chosen—ourselves. Now we are the gatekeepers and long lines are forming outside our doors. We used it to build our Boards, promising prospects that our Board was more prestigious and their contributions would mean more if given to “us” than to “them.” We celebrated our success in this zero-sum competitive frame with press releases about box office records, enormous donations, celebrity appearances, and transfers.
What if The Scarcity Matrix is simply the logical extension of everything that’s been done to turn our nonprofit theatres into sustainable businesses through the overuse of the Principle of Scarcity?
One of the resources is also expertise. And we have convinced ourselves, our boards, our funders, and our audiences that expertise itself is in scarce supply, and that we are at risk of our experts bolting for the greener pastures of corporate America or Hollywood if we don’t offer competitive wages and benefits to the Few Who Know. And to keep Them we need to build larger institutions, bigger buildings, and opportunities for celebrity and commercial transfers. And even these Few Who Know are in some ways convinced of their own rare abilities—they are knocking themselves out in this Scarcity Matrix, trying to make sure their organizations remain fiscally sound, artistically relevant, and contributing members of society. They are convinced they are a scarce resource, the anointed keepers of the flame. And while many have defeated scarcity for themselves, they cannot quash it for their institutions. They feel they are constantly teetering on some edge. They are isolated. They are defensive. They are overworked and underappreciated. And they are worn out.
“The Matrix is the world that has been pulled over your eyes to blind you from the truth.”
What if someone started shouting “Abundance!” in the overcrowded Scarcity Matrix and everyone suddenly woke up? What if, in waking, we immediately began the job of negotiating that abundance by coordinating the resources under our stewardship? Would we begin to imagine and create solutions to the intractable problems of our field that we simply cannot dream of in a zero-sum world? Would we start creating wealth in our field, instead of sparring over scraps? Would there suddenly be alternatives to the suffocating binaries in our Scarcity Matrix? You or me. Artists or Institutions. Men or Women. White People or People of Color. Popular or Artistic. Relevant or Excellent. Produced or Presented. Would we start trading our expertise within the ecosystem rather than monetizing—and then privatizing—it? Would we find a way to transform the “dead capital” resources and recirculate them as an alternative currency? Would we create a venture fund for nonprofit transfers rather than creating wealth for individual investors outside the ecosystem? Would we find a role for our theatres in the center of the civic life of our communities rather than on the fringes of them?
What if Buckminster Fuller was right and it “no longer has to be you or me” and “selfishness has no integrity whatsoever”?
What if we took the red pill? What if we unplugged from The Scarcity Matrix? Yes, we’d fall down a rabbit hole and we may not be able to easily predict what would happen next. Would it be better to wake up?