Low Gender-Pay Complaints Are An Admission of Subpar Talent

Low Gender-Pay Complaints Are An Admission of Subpar Talent
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"Yeah, you're a genius, everyone knows it, a goddamn genius, but that's why you failed as a head coach - that's why you'll never be a head coach ... some genius." Those were the words of head NFL coach Bill Parcells to then assistant, and at the time once-failed (with the Cleveland Browns) head coach, Bill Belechick.  During a game Belechick had suggested a defensive scheme that Parcells rejected, only for Belechick to be proven correct. Parcells' irritated reply revealed a now dated view among some football types about Belechick; that while he was in possession of a brilliant defensive mind, he didn't have the skills to run a team.

Parcells' dismissal of Belechick came to mind recently with the release of a video by actress Kristen Bell in which she complained about the alleged "gender pay" gap between men and women. Much ink has subsequently been spilled about how Bell unwittingly exposed a huge profit opportunity for self-interested business owners: if in fact women are underpaid relative to their skills just because they're women, smart owners will snap them up only to reveal through success in the marketplace why women are underpaid. 

Of course, that almost misses the point. While it's certainly true that discrimination in a meritocracy is expensive, the latter was proven won long ago. There are so many examples, but in 1970 a racially integrated USC Trojan football team traveled to Birmingham, AL to play the then all-while Alabama Crimson Tide. USC walked all over the Tide, and in doing so, forced a much more rapid integration of SEC football, and sports in general. Those that hire or promote based on gender or race, or who fail to do so based on same, will pay a high price for discriminating.

Seemingly the bigger story about Bell's mindless video has to do with the unspoken truth that those who complain about gender-pay discrimination are unwittingly admitting that they don't rate the supposedly equal - or greater - pay that they desire in the first place. In the real world, no truly talented person would seek coerced higher pay; instead, the skilled would reveal in the marketplace just why their pay isn't high enough through performance proving just that. In short, if women really feel they're underpaid relative to their male peers, they should express this truth in the free market.

A reply to the above view may well be that talented women lack the opportunities to prove their equal or greater worth. But if that's the reply, it can't be stressed enough yet again that such a retort blaming gender discrimination for supposedly slim compensation opportunities is an explicit admission of subpar talent.

Indeed, what's seemingly forgotten by the gender-pay gap crowd is that many of the highest paid males in the U.S. marketplace were similarly long discriminated against before ultimately proving their naysayers wrong. What's forever been proven true in the meritocratic markets is that really good commercial ideas, and really innovative processes, are frequently met with great skepticism - as in discrimination - in the initial stages. More specifically, the talented who ultimately rate enormous pay packages alongside great wealth usually only reach that point after being dismissed and discriminated against by the existing powers that be. Low pay and low treatment is not a gender thing.

Jeff Bezos founded Amazon.com back in 1994 at a time when there existed great skepticism about the commercial worth of the internet. Had the established powers of the business world taken this maverick seriously, it's a near certainty that business behemoths of the Wal-Mart variety would have quickly paid Bezos billions for his innovation; that or they would have feverishly begun copying him right away. In reality, Bezos pursued a retail empire rooted in online sales that was ignored for quite a while. Even though Wal-Mart had much greater resources at its disposal, it didn't use them to vanquish Amazon as a competitor. To this day Wal-Mart is still striving to equal or exceed Bezos on the e-commerce front; it's recent acquisition of Jet.com for $3 billion yet another admission from the big box retail giant that its early dismissal of Bezos (now one of the five richest men in the world) has proven quite costly.

Not too long after Amazon entered the marketplace, now bankrupt Blockbuster Video had the opportunity to acquire Reed Hasting's struggling online DVD rental service NetFlix for a tiny fraction of its present worth. Blockbuster's dismissal of NetFlix proved costly too; so costly that Blockbuster no longer exists. And rather than sit back and wait for another competitor to compete away its DVD rental profits, NetFlix proceeded to essentially put its initial source of great profits out of business in favor of movie and television-show streaming.

The late Steve Jobs introduced an Apple iPhone at a time when Palm and Blackberry were the undisputed powers in the smartphone market. The very notion of a $500+ device that lacked Blackberry's then advanced keyboard was mocked by smartphone experts, including management at then-powerful Blackberry itself. Jobs died after adding many billions to his net worth, but only after being dismissed by a company - Blackberry - whose products are presently vanishing before our eyes thanks to it ignoring a market evolution that Jobs plainly saw.

Back to Belichick, readers might stop for a second and imagine what the outcry would have been had Parcells - or any other male CEO - insulted a woman or minority employee in the same way that he did Belichick. Given the hyper-litigious society in which we live Parcells would have been fired, and the New York Jets would have paid big fines for his discouraging words.

What would have been missed is that the commercial present rarely predicts the future. While Parcells viewed Belichick as a career assistant, others (most notably New England Patriots owner Bob Kraft) thankfully didn't. Four Super Bowl victories later, it's increasingly said that Belechick is the greatest NFL coach ever. So rabid are sports fans that other NFL owners (and college ADs) are constantly in search of the next Belichick, or Nick Saban. Rest assured that if an individual possesses the genius of either, gender or color won't prove a barrier to employment forever.

What this hopefully reminds us is that whether in sports, or the traditional world of business, the path to higher pay for the super-talented is often paved with discrimination. Almost as a rule. Figure that those who truly rate higher pay than their peers usually only do because they have ideas about how to do things that have so far not been tried, and because they haven't been, they're regularly the source of early-stage ridicule. In commerce, if you have a great idea you almost literally have to force it on people.

As evidenced by his unrivaled success in the present, the formerly $25/week assistant in Bill Belichick was once underpaid. So were Steve Jobs, Jeff Bezos and Reed Hastings similarly underpaid. Visionaries are discriminated against more than anyone.

Applied to females, rather than decry a supposed gender wage gap rooted in discrimination, they should simply prove it as the discriminated against long have. If not, as in if they intend to produce videos or pursue legislation to air their grievances, they're merely admitting for all to see that their level of talent doesn't rate equal or greater pay to begin with.

John Tamny is editor of RealClearMarkets, Political Economy editor at Forbes, a Senior Fellow in Economics at Reason Foundation, and a senior economic adviser to Toreador Research and Trading (www.trtadvisors.com). He's the author of Who Needs the Fed?: What Taylor Swift, Uber and Robots Tell Us About Money, Credit, and Why We Should Abolish America's Central Bank (Encounter Books, 2016), along with Popular Economics: What the Rolling Stones, Downton Abbey, and LeBron James Can Teach You About Economics (Regnery, 2015). 

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