‘Capitalism is dead. Now we have something much worse’
theguardian.com
‘Capitalism is dead. Now we have something much worse’
1–10 of 39 posts
Re: ‘Capitalism is dead. Now we have something much worse’
#2"I read him McNamee's reply: "I buy the basic thesis. The US kept interest rates at near zero from 2009 to 2022. This encouraged business models that promised world-changing outcomes, even if they were completely unrealistic and/or hostile to the public interest (eg the gig economy, self-driving cars, crypto, metaverse, AI). This came at a time of no regulation of tech and an accepted culture in business that said executives should maximise shareholder value at expense of everything else (eg democracy, public health, public safety)... had rates been at 5% the past 14 years, I doubt very much that the gig economy, self-driving cars, crypto, metaverse or AI would have gotten even 10% as much funding.""
Re: ‘Capitalism is dead. Now we have something much worse’
#3"I read him McNamee's reply: "I buy the basic thesis. The US kept interest rates at near zero from 2009 to 2022. This encouraged business models that promised world-changing outcomes, even if they were completely unrealistic and/or hostile to the public interest (eg the gig economy, self-driving cars, crypto, metaverse, AI). This came at a time of no regulation of tech and an accepted culture in business that said ex…
Distorted interest rates touch everything. If we're going to pick a handful of things that low interest rates effected that basket is too varied. The gig economy is a major employer, the others are not. And AI isn't being pushed by low interest rates, it is being pushed by things like AlphaGo or ChatGPT being somewhat magical.
Re: ‘Capitalism is dead. Now we have something much worse’
#4"More precisely, I will come to the following conclusion. Whenever the rate of return on capital is significantly and durably higher than the growth rate of the economy, it is all but inevitable that inheritance (of fortunes accumulated in the past) predominates over saving (wealth accumulated in the present). In strict logic, it could be otherwise, but the forces pushing in this direction are extremely powerful. The inequality r > g in one sense implies that the past tends to devour the future: wealth originating in the past automatically grows more rapidly, even without labor, than wealth stemming from work, which can be saved. Almost inevitably, this tends to give lasting, disproportionate importance to inequalities created in the past, and therefore to inheritance." (20.3)
"The inequality r > g implies that wealth accumulated in the past grows more rapidly than output and wages. This inequality expresses a fundamental logical contradiction. The entrepreneur inevitably tends to become a rentier, more and more dominant over those who own nothing but their labor. Once constituted, capital reproduces itself faster than output increases. The past devours the future." (27.6)
- Thomas Piketty, Capital in the 21st Century
Re: ‘Capitalism is dead. Now we have something much worse’
#5"More precisely, I will come to the following conclusion. Whenever the rate of return on capital is significantly and durably higher than the growth rate of the economy, it is all but inevitable that inheritance (of fortunes accumulated in the past) predominates over saving (wealth accumulated in the present). In strict logic, it could be otherwise, but the forces pushing in this direction are extremely powerful. The…
This is a great book. I have Capital and Ideology on my nightstand too but I'm building up the fortitude to power through it.
Re: ‘Capitalism is dead. Now we have something much worse’
#6"More precisely, I will come to the following conclusion. Whenever the rate of return on capital is significantly and durably higher than the growth rate of the economy, it is all but inevitable that inheritance (of fortunes accumulated in the past) predominates over saving (wealth accumulated in the present). In strict logic, it could be otherwise, but the forces pushing in this direction are extremely powerful. The…
This is a great book. I have Capital and Ideology on my nightstand too but I'm building up the fortitude to power through it.
I just started reading it last night, really enjoying it
Re: ‘Capitalism is dead. Now we have something much worse’
#7[flagged]
Re: ‘Capitalism is dead. Now we have something much worse’
#8"More precisely, I will come to the following conclusion. Whenever the rate of return on capital is significantly and durably higher than the growth rate of the economy, it is all but inevitable that inheritance (of fortunes accumulated in the past) predominates over saving (wealth accumulated in the present). In strict logic, it could be otherwise, but the forces pushing in this direction are extremely powerful. The…
Realistically, any small amount of wealth that is available to a citizen will not grow significantly relative to any other comparable amount, since there is no room for it to grow. So don't worry about this devouring business.
But other than that, accumulated wealth and inheritance is going to play much bigger role than it was last century, which historically was a fluke.
Better save some money so you can get your children a place to live of their own.
Re: ‘Capitalism is dead. Now we have something much worse’
#9"I read him McNamee's reply: "I buy the basic thesis. The US kept interest rates at near zero from 2009 to 2022. This encouraged business models that promised world-changing outcomes, even if they were completely unrealistic and/or hostile to the public interest (eg the gig economy, self-driving cars, crypto, metaverse, AI). This came at a time of no regulation of tech and an accepted culture in business that said ex…
Distorted interest rates touch everything. If we're going to pick a handful of things that low interest rates effected that basket is too varied. The gig economy is a major employer, the others are not. And AI isn't being pushed by low interest rates, it is being pushed by things like AlphaGo or ChatGPT being somewhat magical.
...and where did the money for AlphaGo and ChatGPT come from again?
Re: ‘Capitalism is dead. Now we have something much worse’
#10"More precisely, I will come to the following conclusion. Whenever the rate of return on capital is significantly and durably higher than the growth rate of the economy, it is all but inevitable that inheritance (of fortunes accumulated in the past) predominates over saving (wealth accumulated in the present). In strict logic, it could be otherwise, but the forces pushing in this direction are extremely powerful. The…
This gets at where I disagree with Varoufakis (and Zuboff). The rent-seeking dystopia we have is not something "beyond" capitalism, unless one conflates capitalism with free markets - which is and always has been a mistake. The distinguishing feature of capitalism is in the name: a disproportionate favor given to capital. This is especially evident in tax laws, but also IP law, labor law, etc. As Piketty points out, this inevitably leads to pervasive rent-seeking. That's not a "beyond"; it's the (mostly) stable end state once such a system is put in place. It's actually injurious to free markets, and nobody should hate it more than those seeking to enter a market with a genuinely innovative idea. Unfortunately, there are more people seeking to be favored servants than independent people.