Being pragmatic is commonly viewed as a positive attribute for an entrepreneur to possess. This is because being pragmatic is generally defined as being practical, rational and fact based. Decisions and actions based on facts and reason underpin all of Objectivist thinking. By this definition these are good attributes for an entrepreneur to practice. However, this is not the proper definition of pragmatism. This might be a moot point if pragmatism meant essentially the same thing as being practical, and this was just a semantic issue. It is not. In fact pragmatism is the opposite of being practical. It is commonly practiced and potentially damaging; thus the importance for an entrepreneur to differentiate between being pragmatic versus practical and recognize the hazards.
Pragmatism is a philosophical tradition that began in the United States around 1870. Its origins are often attributed to the philosophers Charles Sanders Peirce, William James, and John Dewey. Peirce claimed that truth is “the opinion which is fated to be ultimately agreed to by all who investigate”. Per Wikipedia “Pragmatism considers words and thought as tools and instruments for prediction, problem solving and action, and rejects the idea that the function of thought is to describe, represent, or mirror reality.” Similarly Merriam Webster defines Pragmatism’s view of truth as “truth is preeminently to be tested by the practical consequences of belief.”
For a pragmatist, there are no principles that “mirror reality” to guide one’s decisions and actions. Truth and reality are separated. There are only outcomes that have “practical consequences”. Pragmatism “rejects….the function of thought” to “describe, represent, or mirror reality”. For a pragmatist an object isn’t defined in reality by the nature of the object you perceive through your senses but rather by the “practical consequences of belief.”
For an Objectivist the immediate question is where did the words and thoughts come from in the first place if they are not a description of reality itself? What is the meaning of a word or thought detached from reality? For an Objectivist reality exists independent of our consciousness. We perceive reality through our senses and thereby become consciously aware of it. It is in fact through conscious thought that we are able to describe and understand reality. Not the other way around. Objectivists refer to this error as the primacy of consciousness over the primacy of reality.
“The primacy of existence (of reality) is the axiom that existence exists, i.e., that the universe exists independent of consciousness” Ayn Rand
Ayn Rand
The next objection an Objectivist would have about Pragmatism is what principles are being applied to assess “practical consequences”; practical to whom, for what purpose, based on what values? Pragmatism isn’t wrong because it has principles that are wrong. It is wrong because pragmatism doesn’t accept the validity of principles to guide one’s decisions and actions in the first place. Pragmatism rejects thought as the basis for making decisions and principles as being fundamental to determining what is or isn’t a “practical consequence”. Pragmatism replaces principles with gut feelings or intuition for some short term benefit.
This might seem a bit academic and irrelevant for an entrepreneur making daily decisions. Hang on just a bit longer. When pragmatic versus practical is defined so distinctly they are clearly not the same. Presumably you see the distinction now. So you might ask why then would anyone want to be pragmatic? In my experience, lots of entrepreneurs act pragmatically. It happens all the time. Here are some examples.
Have you ever heard anyone say when you asked them why they do something a particular way they respond “I don’t know? That’s the way we have always done it.” That’s a pragmatic answer, with the “I don’t know” meaning they do not know what the principles were that made something practical in past and whether they still apply now and in the future. Have you ever seen a company pursue a short term gain at the expense of a greater long term benefit to the company? That’s pragmatism implying there are no absolute principles to guide longer term decisions so “worry about today and let tomorrow take care of itself”. Have you ever heard the expression “He is speaking out of both sides of his mouth.” That’s a comical reference to pragmatism where someone hopes to gain agreement amongst people through deception. I have heard several entrepreneurs claim that they felt their greatest talent for achieving consensus amongst people who had opposing views was being able to deliver a message sufficiently obtuse that everyone believed what they heard was in agreement with their position. If you haven’t known any such businessmen yourself who believe that, perhaps you have no doubt heard it from politicians. Virtually all of whom are pragmatists.
And finally, as this is the most common one I have seen amongst entrepreneurs, are those who believe it is better to “get along” than “get it right”? That is a pragmatic person attempting to gain a “practical consequence” of agreement in contradiction to reality itself. Bill Gates and Steve Jobs we’re notoriously difficult people to “get along” with. Bill would regularly berate and cut off fellow executives during Microsoft presentations with statements such as “That’s the stupidest thing I’ve ever heard.” Steve Jobs would throw temper tantrums in negotiations. But clearly they were right more often than they were wrong whether they were liked for it or not. Right is right and can’t be wrong. Wrong is wrong and can’t be right. That’s objective reality. That’s being practical, not pragmatic. On a positive note however, Bill and Steve got along best with those who also wanted to get things right and as they grew older were somewhat more circumspect with their remarks.
“There is no conflict between men of reason.”
Ayn Rand
Pragmatism’s primary danger for an entrepreneur is that it undermines long range thinking and planning. As defined, entrepreneurship is about creating products or services based on a vision not of what is, but what could be. Entrepreneurship demands planning for the future; not simply reacting to the present. An Objectivist entrepreneur applies universal principles based on facts and reason to make long range decisions. It is common to sacrifice a short term gain for a larger long term gain. Knowing when to do this requires principles that guide one’s decisions and actions. Metaphorically speaking, to do otherwise is to put to sea sailing downwind whichever way the wind blows, wherever it may take you, rather than in the direction you want to head. An Objectivist entrepreneur knows sometimes you have to sail to windward, with the wind in your face and seas crashing over the deck to reach their desired destination.