Austrian economics

Red Bull Is Disgusting. And It Perfectly Captures Why Capitalism Is So Great.

Ludwig von Mises is “my hero,” and free markets have nothing to do with efficiency, says Ogilvy ad man Rory Sutherland.

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With unemployment at 15 percent and rising and the hashtag #RIPcapitalism trending on Twitter, libertarian ideals of free minds and free markets need champions now more than ever.

Rory Sutherland, the vice chairman of the legendary global advertising agency Ogilivy UK, may seem like an unlikely defender of capitalism, but he is one of its most persuasive and engaging. 

Sutherland calls the stentorian Austrian economist Ludwig von Mises his hero and celebrates not capitalism's ruthless efficiency and capacity to outproduce a command economy but its ability to create seemingly trivial products such as Red Bull and to transform the disgusting-sounding Patagonian toothfish into the delicious delicacy known as Chilean sea bass.

Fittingly enough, Sutherland's latest book is called Alchemy: The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life. It explains why the real genius of capitalism isn't maximizing output but the ways in which creative destruction fulfills desires we never knew we had, allowing us to become whatever we want to be. He's a critic of economistic thinking on the right and the left that reduces all human activity to mere utility and material considerations. 

I spoke with Sutherland, who is equally likely to quote Friedrich Hayek, Andy Warhol, or the left-wing social critic Pierre Bourdieu, just a few weeks before the coronavirus pandemic hit. Ironically the subsequent lockdown that has cratered the economy makes his views more relevant than ever.

Edited by John Osterhoudt, intro by Lex Villena. Cameras by Jim Epstein and Kevin Alexander.

Photo credit: Ludwig von Mises Institute / CC BY-SA (http://creativecommons.org/licenses/by-sa/3.0/); "Redbull" Photo 153155282 © Ilkin Guliyev – Dreamstime.com; "Chilean Sea Bass: ID 12955855 © Boris Ryzhkov | Dreamstime.com; "Pierre Bourdieu" SELDERS ANNE/SIPA/Newscom

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  1. Or condense it down to its basis; “no one has ever gone broke underestimating the tastes of the American public”.

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  2. Chilean Sea Bass and Red Bull both taste great to me. No joke. I love the taste of both, but I’ve also convinced myself I love the taste of pussy, so what the fuck do I know?

    1. Maybe once you actually get someone to let you try it, you’ll know for sure.

      1. The Red Bull, the sea bass, the or the pussy. Be specific freak show.

        1. I love this comment board.

          1. I’m sitting here howling in the middle of a research meeting. I hate you assholes.

            1. ¯\_(ツ)_/¯

              1. We have fun here.

        2. Speaking of freak shows, I love the taste of Red Bull, but I can’t stand alcohol.

    2. If Red Bull really tasted terrible, the mixed drinks would’ve been ‘Red Bull sour’ and ‘Red Bull daquiri’. Red Bull and vodka is/was popular specifically because of (the mix of uppers and downers and) the flavor.

      1. I don’t like the taste of Red Bull on its own — though it’s nowhere near as revolting as Monster — but I’ve always had a fondness for Red Bull and vodka. For some reason, it’s the perfect combination.

        1. I always preferred Rockstar, which tastes like crushed up Adderall mixed with Vitamin C powder. Can still put away an entire 750 ml bottle of Woodford Reserve while sipping that shit on the side. One time, I forgot one of my interns outside on the office terrace after a quick afternoon drink/firm meeting turned into a bender. Rockstar and Woodford. I left at around 10:30 P.M. but forgot he was out there. Found him the next morning, still asleep, on the outdoor couch.

          1. I prefer Rockstar too (though of late even that has started to feel cloying to me), but I don’t think I’ve ever mixed it with alcohol. I’m most likely to pick up a can of NOS or a citrusy AMP on the rare occasions I indulge in caffeine these days.

            1. NOS gives me heart palpitations. That’s how you know it’s good!

              1. Hell, my last year of med school I was pounding 800 to 1000 mg of caffeine a day, enough to probably put the average person into cardiac arrhythmia. I’m immune to that shit.

        2. >>Red Bull and vodka

          went out a lot in 1998 did you?

          1. I hadn’t had my first drink back in 1998.

            1. banner year for red bull & vodka. and ecstasy.

          2. ’98? I’d give you ’08, but ’98 is way too early.

            I was still under age in ’98 and nobody had heard of Red Bull. I seem to recall the combination being popular circa Four Loko’s calamitous rise, which would put it somewhere in the MID ’00s. My mid-late 90s were fueled by Jolt Cola and ECA stacks but no alcohol because that would be breaking the law. Teenage me was nothing if not strictly law-abiding.

            1. (friendly-like) wiki: In 1992, the product expanded to Hungary and Slovenia. It entered Germany and the UK in 1994, the United States (via California) in 1997

              summer ’98 the Dallas sluts were sucking it down faster than we could pour it. phrasing.

              1. I wouldn’t know. The sluts in Wisconsin weighed over 300 pounds and were shaped like potatoes. I wasn’t paying much attention.

                1. sorry man in Dallas everyone’s a cover model. or thinks she is.

                  1. I knew some Dallas girls…
                    Good people

              2. Again, I’m not saying that Red Bull didn’t exist in ’98. Just saying that Red Bull and vodka necessarily trailed Red Bull’s availability and took a few years to achieve saturation to the point that even the kids in the remote corners of flyover country were availing themselves of it.

                Fair enough to say I was too young, wasn’t paying close enough attention, and/or wasn’t an early adopter. You might say that as someone who drinks black coffee, I’d probably incorrectly remember the origin/rise of the frappacino for similar reasons.

                1. I was raised in flyover country, so I doubt Red Bull and vodka was a huge phenomenon in my corner by ’98.

    3. The kind found in Chinese wet markets or porn?

      1. There’s fish porn? Forget it. I don’t want to know.

        1. What if it’s kinda like Daryl Hannah in Splash? Huh?

      2. Chinese Wet Market was my nickname for my ex-wife’s private parts.

        1. Could I get her number?

    4. required convincing?

  3. It explains why the real genius of capitalism isn’t maximizing output but the ways in which creative destruction fulfills desires we never knew we had, allowing us to become whatever we want to be. He’s a critic of economistic thinking on the right and the left that reduces all human activity to mere utility and material considerations.

    Haven’t read the book, but if this is accurate, then the author is missing the point. The point is that the “output” capitalism is maximizing is a subjective quantity that depends on the collective values of everyone in the market. Capitalism isn’t about maximizing the output of a given product. It is about maximizing the output of value, which necessarily means shifting production from one thing to another thing (which may not have even existed ten minutes ago).

    1. The point of capitalism is to decentralize economic decision making

      1. That’s another way of putting it.

      2. Advertising agencies are nothing more than a bunch of shallow people who spend their time convincing you a product that really sucks, cheap and junk is great for you and convince you the high price is worth it. All you have to do is look at the way Americans, who once were the best dressed in the world, walk around in drab colored, communist Chinese, Tshirts and shorts. They have convinced you have to wear jeans with holes in the knees or some even falling apart. Kind of makes the automobile dealers jealous. They sure wish they could sell you old “designer” car clunkers with rust holes in them and charging top dollar. I grew up very poor and my mother sewed patches in my jeans. The rich now want to imitate the poor, but still keep their money.
        Hershey’s decided to fill one of their chocolates with air, selling less for more money. They had the audacity to call this cheapened product, Air Delights. Ad agencies believe customers are fools and suckers to a point that they can sell you air and make it palatable. Ad agencies sell perception and are engaged in social engineering, ignoring any sense of reality. Ads, as are TV programs, planted with subliminal, social persuasion. I know, I worked in one for years.

    2. free markets have nothing to do with efficiency

      Free markets have everything to do with efficiency, in exactly the same way they maximize output. You can’t measure efficiency and output without defining exactly what it is you’re measuring. Is Walmart more efficient than Ralph Lauren at producing the maximum output of clothing? Not if you want Ralph Lauren clothing, they’re not. If you’re simply counting output and efficiency as the number of “things”, Seiko would have put Rolex out of business years ago. And yet, there are people who will spend good money for a Rolex watch because a Rolex watch delivers more personal, intangible, and abstract benefits than just letting them know what time it is, benefits a Seiko is much less efficient at delivering because its output of these benefits is zero.

  4. When you have to abuse Hayek to justify Red Bull it’s time to realize your philosophy is worthless.

    1. and what philosophy should be adapted?

  5. “Rory Sutherland, the vice chairman of the legendary global advertising agency Ogilivy UK, may seem like an unlikely defender of capitalism”
    Why wouldn’t he defend capitalism? Dumb statement.

    1. Yeah, it was weird and unnecessary stage-setting /framing. Why would Nick want us to think this guy is a communist, or should be a communist? Do ad agencies do well under communism?

      1. He started the podcast with “With unemployment rates at (some high level). This isn’t unemployment for aggregation with all the other employment data gathered over the centuries. This is house-arrest/forced idleness and needs a different category for analysis; maybe added to the results of totalitariansim.

  6. While we are on free markets, why is Reason hiding the Hong Kong legislature takeover. I would’ve thought that a libertarian site would report on the top communist slug guns going into that room and stripping HKers of their right to smash the speakers in the streets playing the chicoms athem.

  7. Hey, mom, I’m really busy posting dumb comments on the internet. Can you bring down some nachos and a Red Bull?

  8. Very efficiently written information. It will be beneficial to anybody who utilizes it, including me. Keep up the good work. For sure i will check out more posts. This site seems to get a good amount of visitors.

  9. Huh, I’m drinking a Red Bull right now. To correct the record, Red Bulls are delicious. All other energy drinks are terrible.

  10. The catch, as implicit in one point mentioned only briefly in the 2:25 mark, is that psychology is ultimately dependent on physics.

    And that’s where the whole argument falls apart.

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