191–200 of 270 posts
1. No significant improvements like agriculture.
2. Increasing regulations
3. Big middle class that have no strong motivation to advance further or have "enough money" for good living (modulo individuals)
4. Growth in domain which GDP doesn't capture e.g. Open Source
5. No obvious investments opportunities e.g. Highway
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i am a bull. i just think that we should talk about what the problems are. ignoring them is not a good way to fix them.
What if growth in the US is being prevented by technology innovation? If I replace 100 jobs with 1, and no further jobs are need for those 99 people, and that's the core of what technology does, growth in the traditional sense isn't possible. I agree that a basic minimum income may be necessary; I don't believe it'll fix the growth problem though.
But those same technological advances invent new goods and services for an ever increasing population. More people are fighting over the same set of resources, which technology allows markets to distribute more efficiently. The new tech creates new demand no one knew was needed (e.g. the mainframe, the internet, mobile web, the blockchain).
While it's tough luck for the 99 workers who are not in a position to learn new skills, the bet is that tech advancing will create more economic opportunities for the next generation (while improving the quality of life) and upgrading society like 'aging up' in Age of Empires or Civilization.
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For one, we've entered an age where the economies of most of the countries in the world have become interconnected to some extent. Just 100 years ago, this wasn't the case. I don't blame you because this is the kind of conventional trope that everybody parrots and just feels right, but economic historians agree on that the extent of globalization 100 years ago was in fact just as high as it is today in many respects…
I was specifically thinking of the European Union (which didn't exist 100 years ago) and its relationship with the Greek economy, and the extent to which a Greek default in 2011 or 2012 might have affected economies across Europe and overseas, as well as the effects of the U.S. economic recession in 2008 on the rest of the world. You're right to point out that all (edit: many) of the pieces of globalization were well…
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This same argument has been repeated for literally centuries now, and it always turns out wrong in the long run. Imagine if we could run the entire world economy with only 5% of the workers. Pandemonium? No, it has already happened before. Agriculture was the whole economy, the rest was rounding error. Virtually all workers worked in agriculture. Now we produce all that and much more with something less than 5% of th…
It turns out to be right, often enough. In the 19th century, for instance, there was a class of physical laborers whose numbers in the USA reached the tens of millions. But as technology--particular the combustion engine and fossil fuel refining--took off, they became surplus unusable labor that literally was more valuable being turned into glue, or letting them starve to death. Yeah, horses. "But it's different this…
So where's the big negative fallout? If the set of unemployable people has been growing for centuries, where is the mass starvation and misery? How can it be possible that the 20th century -- well into the process you describe -- saw a burgeoning middle class in the West, and then later a burgeoning middle class in Asia?
Clearly the benefits of productivity growth have been bigger than the overhead required to support the people who cannot contribute.
I'm not arguing that everybody is infinitely retrainable. I think the biggest problem we face is several generations of existing people with completely obsolete mindsets, who are too old to relearn.
Your whole argument is written in terms of employment at a job. But that's precisely part of the mindset that is obsolete. The idea that "getting a job" is the best option for most people is historically recent and already dying. There are plenty of other ways to organize an economy, and there's plenty of historical precedent for the idea that common people can successfully operate far more independently than they do under the industrial model. In a capital rich environment, you teach people to be capitalists, and let a million independent experiments blooms.
The alternative is you keep teaching people to defer to the boss, and the boss evolves into the Lord, and we go back to serfdom. That could happen too.
Assumptions about what "average people" are capable of need to be judged against the system that's training those people. Our present system was consciously designed to make them into good industrial widgets. But the malleability of children is absurdly high, and from directly experience I see no reason you couldn't turn nearly all of them into creative capitalists.
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Ah, the classic paternalistic argument. It's deeply appealing to many people's preconceptions. But a growing body of experimental results call it into question. When you actually conduct the experiment -- a randomized controlled trial where you give some poor people cash and others in-kind services, the cash group outperforms.
For those asking, here are some links that will start you down the path to reading all about said research: http://www.npr.org/blogs/money/2013/10/25/240590433/what-hap... http://freakonomics.com/2013/06/04/should-we-all-just-give-c... http://freakonomics.com/2013/09/26/would-a-big-bucket-of-cas... http://freakonomics.com/2013/11/27/fighting-poverty-with-act... http://poverty-action.org/project/0522 I'm glad I could…
I'm not clear on how any of this will lead to a recession. Why will high Debt-to-GDP or government spending send the economy into a recession? Q1 GDP numbers were clearly affected by dismal weather (although still bad), but labor markets are improving markedly, and there are reasons for optimism. I don't see this as a very convincing bear case. For the bull case, see this post, from a guy who's been right about every…
i am a bull. i just think that we should talk about what the problems are. ignoring them is not a good way to fix them.
The rest of these charts are basically the background on the decline-and-fall of america, and I would say only tangentially relate to the startup ecosystem.
the most important chart that you left out was the stock price of Facebook, which is riding/causing a wave of investor (and corporate) enthusiasm for all things social, which in turn benefits the startup eco system because they buy lots of companies, and drive the hype that a given company could be the "next" facebook or sell to them.
Facebook (more so than google) seems appropriate for ecosystem barometer because:
* they do the most audacious acquisitions, with due diligence that consists of weekend meetings eating strawberries - $17bn for whatsapp, etc.
* Facebook is valued at $170 billion dollars, based on selling ads which I've never seen (because i use adblock+) and peddling to brands i also never engage with (because i only use FB to keep up with friends). that seems unsustainable IMHO.
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What if growth in the US is being prevented by technology innovation? If I replace 100 jobs with 1, and no further jobs are need for those 99 people, and that's the core of what technology does, growth in the traditional sense isn't possible. I agree that a basic minimum income may be necessary; I don't believe it'll fix the growth problem though.
Tech Innovation kills existing jobs by replacing 100 humans with one machine, this is true. If you're a cab driver, you may not be ecstatic about self-driving cars. But those same technological advances invent new goods and services for an ever increasing population. More people are fighting over the same set of resources, which technology allows markets to distribute more efficiently. The new tech creates new demand…
While I'd agree this has been the case historically, I'd argue this is no longer the case.
> While it's tough luck for the 99 workers who are not in a position to learn new skills, the bet is that tech advancing will create more economic opportunities for the next generation (while improving the quality of life) and upgrading society like 'aging up' in Age of Empires or Civilization.
Seems like a pretty big bet to take.
Where are ~4 million drivers going to go when self-driving cars roll out? Bus boys? Service jobs? Technology is going to saturate the labor market with surplus labor (that labor having been automated away). History has shown us this does not end well.
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Not being sarcastic here. 2013 A = Debt is around: $17.5 trillion B = Debt Service: $416 billion C = Average Rate: 2.38% ($416 billion / $17.5 trillion) D = U.S. Tax Revenue: +/- $2.8 Trillion Things won't get interesting until B approaches D. So one way of looking at is if everything remained constant (which it won't) you'd need 15% interest rates on the current debt for debt service to approach tax revenue. If inte…
"Things won't get interesting until B approaches D." I'd say things would get pretty interesting well before that point. B=D is just the point at which a default is inevitable (unless much higher tax revenue is achievable without causing other problems). But the problem is that the interest rates are so low now that large increases are not outlandish. 7 years ago, the rate was more than double what it is now. Looking…
He just suggested a basic income for everybody. I just wanted to point this out in case people missed it when skimming.
oops, i accidentally published an earlier draft. i added a bit more of my thinking here--my sense is that it would probably lead to less waste than current systems. i'm also not sure it's the right approach, but i haven't heard any better ideas yet.
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"Things won't get interesting until B approaches D." I'd say things would get pretty interesting well before that point. B=D is just the point at which a default is inevitable (unless much higher tax revenue is achievable without causing other problems). But the problem is that the interest rates are so low now that large increases are not outlandish. 7 years ago, the rate was more than double what it is now. Looking…
Interest payments as a percentage of GDP are actually much lower now than they've been in the past: http://research.stlouisfed.org/fred2/series/FYOIGDA188S