This is the real root problem - People are helping their already rich friends too much. Companies shouldn't be about the CEO and their friends, it should be about the product and the customers. Promoting the children of your rich friends in your news articles doesn't help balance out wealth equality.
There are thousands of other (poorer, more determined) entrepreneurs like 'Matt Dalio' who probably deserve the attention even more.
>> Dalio did not give up.
Yeah that totally deserves its own paragraph; not giving up is a huge achievement when daddy is a billionaire. It's almost like the author's subconscious is trying to tell us something.
This seems more accurate and realistic about the source of the discrepancy:
Rich people have the luxury to choose which risks they take and make calculated endeavors, but are never forced to take a risk and have great ability to manage their total exposure to risk.
Poor people are inundated with being forced to take bad risks and manage the danger between them constantly, such that they can't properly gather resources to take on additional voluntary risks (even when they have an expected reward) because it poses too much systemic danger with the additional risk.
That said, once you count in drug sales, the poorest 10% of people I know have a higher per capita entrepreneurship rate than the richest 10%. So in practice, poor people are actually taking on business risk at a higher rate as well, though it's again motivated by necessity.
The biggest discrepancy is, of course, access to capital and explain the vast majority of the discrepancy in outcome.
I'm not saying drug dealer -> poverty.
I'm saying poverty -> necessity to try something to escape a slow death.
(And for cultural reasons, the latter often appears as greed when successfully applied, rather than desperate necessity. Look at the motivation for the hustle, not the outcome. A fear of a very real death to poverty is usually the motivating factor.)
This means that you end up with a lot of people having some kind of hustle, which the statistics also reflect once you remember that drug dealers (and other criminals) are a form of business. So you find an unusual amount of businesses per capita, again remembering to include drug operations and similar activities.
Totally agree. Also depends where you go to school, though. There are drug dealers who are poor and do it because it's one of the more attractive (if risky) job options, and there are well-off student drug dealers who know that they can get away with being caught because of their socioeconomic status.
In either case, it's not a totally unreasonable risk-reward evaluation, especially (as with everything) if the dealer knows how to execute (i.e. be careful). I knew several people in the latter camp, and I wouldn't necessarily call them "greedy". Though I suppose I generally dislike the term "greedy" because it's usually pejorative without giving any definition of what greed is or why it is bad.
What do the Rich really Want?
Imagine if oddly, wealthy capitalists didn't primarily want money; but something odder and more hopeful: respect.
Would love to get people's opinion on this video.
Here's a set of videos of the Endless founder.
If you think of how he could have instead utilized his wealth (investing in non-renewable energy projects, high ROI defense/gun stocks) this definitely seems like a less bad alternative.
Also its way better in my opinion than the alternative of using public tax payer money being used for this effort. It needs to be designed to be self sustainable. OLPC seems to have diverted money away from other developing world causes.
And if society truly cared about quality of life for the poorest/weakest, the market would re-align itself, and the direction of creativity would be self corrected.
I feel capitalism and profits are working just fine, we just don't want to admit what our true preferences are.
Fudging the distinction is a fantastically pernicious way to sneak the "capitalism is enlightened altruism" assumption into your argument.
You forget that the market responds to the total volume of buyers at various levels. There are a lot more people in the 0-150k bracket than the people in the 150k+ bracket and when you count the total spending in dollars by each category as a whole, the first group is significantly more powerful.
The most successful companies sell to the masses (McDonald's, Walmart, Google, Facebook). The rich have a much smaller influence on the market than you would like to think.
The preferences of rich _individuals_ have a much higher influence than those of poor individuals.
In the absence of a basic income, willingness to pay represents the true preferences of "people close to the source of money creation", not people or societies in general.
When some parties can conjure money out of thin air, this idea that prices reflect what people want simply doesn't work. The prices begin to reflect, more and more, the desires of people with the ability to manufacture money.
What you seem to be saying is "if the large number of poor people in the world cared about _their own quality of life, they would have it".
> What you seem to be saying is "if the large number of poor people in the world cared about _their own quality of life, they would have it".
Definitely not - but what I won't mind saying is - if the large number of middle class people in the developed world cared about the poor people, the living condition of poor people would significantly improve.
"Working just fine" is a moral judgment you're making, which would be "just fine" in an amoral society (this being a contradiction proving that "morality" exists, "amorality" being one of its possible states).
I do agree that it might be skewed. But I believe there is a sufficiently large middle class that can still drive creativity in the right places if it was so inclined.
This is true of many other industries, not just tech, although tech has been capturing much of the interest and ire of not being different. Any time a company accepts outside money, they have a fiduciary duty to build their business in a manner that will lead to the highest return - "maximizing shareholder value."
Now, this is not inherently bad to maximize value as we have seen the largest growth the world has ever seen (not just at the top end, but for the poor as well) because of the innovation and creativity that has occurred due to chasing profits.
Maybe I'm cynical, but I really don't think tech companies truly are in a "quest to change the world" unless you believe every word spoken at demo day. Should be retitled: "Companies are using creativity to chase profits" because that is what they are doing and is what they should be doing in the current economic system.
I completely agree that incentives and structures should be changed to dramatically reduce the income and wealth disparities. The struggle is the will to voluntarily forego profits.
What poor people want is clean water, a stable source of food, security, health care, honest government, etc, etc. They’ll be happy to have a cell phone, but it’s not going to change their life.
The problem of poverty isn’t the result of lack of access to information.
There was no specific program that inspired me or gave me a leg up - what worked was the fact that my parents were strict and absolute hard-asses who didn't put up with any of my bullshit growing up. I resented them for a long time, but have come to see that they were mostly right.
But hey, you may very well be correct in that a social program works for others.
Also if you have to walk 20 kilometers for the nearest doctor, you want to make sure that the doctor is in today. Same with water, supplies and food.
I would like to disagree on that. Obviously a phone is less important than food and water but when it comes to everything else it is quite a basic component of modern life in all countries/social settings.
A phone is essential to communication, gathering information and education. It is also not prohibitively expensive for the value that it brings.
A working phone number is an invaluable thing to have when looking for work.
But a cellphone to many of them is their first affordable full-time internet access. They could use this to give their children half the childhood you were privileged with.
I don't think that the fact that you did it is proof that the communication revolution enabling instantaneous communication over distance didn't change the world or that not having that ability doesn't negatively impact someone's ability to make money or have a fulfilling social life.
Capitalism should be reformed and a new economic system - based on sharing economy, but in the real sense - should arise.
Inclined to disagree. Plenty of wealthy people see the "market potential" of starting in poorer places (cough Africa) and 'locking up' marketshare.
hell, zuckerberg and others tried pushing through the precedent of zero-rated internet for proprietary services in india and other countries as a way to lock up precedent for when they'd bring the same tech to america. (Not that the latter has needed any help being complacent with zero rating - apparently india beat us on that front)
The two groups that seem most likely to solve the connectivity problem(s) have profit incentives behind it: Facebook and Google.
There are almost certainly others as well.
A question: is it actually true that these things are correlated? I don't know, but on the surface of it, it's not clear to me that they are.
"In practical terms, it is actually possible to take all of the images and data from every website the average person visits in a lifetime, compress them, and fit them onto a single 2-terabyte (TB) hard drive inside a computer."
These are among the many "unspoken truths" of the web, viz. that right now on your person or nearby you have enough storage space to hold every bit of information you will ever need in your lifetime.
I would like to see the statistics.
Obviously, companies like Google are not going to embrace truths like these.
When a user can search a database of downloaded data ("data dump") locally, even without a connection, how would a search engine track the user's queries?
Right now, public information, from academic research to user-generated content, is being hoarded by a few companies and used to collect information about those who wish to access it, which is then used to sell ads.
This is a relatively recent phenomenon and is not necessary.
This is supposed to be the Information Age. We can all access public information in large quantities at high speeds without constant monitoring in the name of pillaging advertising budgets.
While it may not be possible to save every piece of information one needs in advance, certainly much of the piecemeal access to static data that we do today could be averted. (Personally I have been doing this with DNS data for many years, but this is only the tip of the iceberg.)
Why is piecemeal access something anyone would want to avert?
Matters of cost, reliablity and inefficiency aside, it is piecemeal access, one query at a time, each and every one traveling over a insecure network, logged and analyzed 24/7 by myriad third parties all desperate for cash, that gives rise to memes like "You are the product".
It is the gratuitous use of an insecure, invasively monitored network to query information which could be stored locally that is the root cause for many of the complaints that internet users have today. This type of use enables the practices by third parties that users complain about.
That's the problem right there: Capitalism has proven to be excellent at organising an economy. It's excellent! It works with human nature. The largest problems automatically provide the largest reward for solving! It locates decisions at the lowest possible level!
The problem is when people use it as an ideology, i. e. as an end to itself. Intellectual property, for example, with its zero marginal costs, isn't as good a fit for capitalism as wheat: When you're charging $10 for a movie, many people will not watch it because it's only worth $5 to them. That's an inefficiency as glaring as communism ever produced, because it is value lost as a tribute to keeping the structure intact, even though no work would be required for it at all.
There are many more inefficiencies of capitalism that we conveniently ignore. The complete finance sector is nothing but the bureaucracy needed to organise capitalism. Competition is a great method to get better results, but it also involves a lot of duplicated efforts. Advertisement is–and this is the usual argument of people defending it-neccessary for the functioning of capitalism because it spreads information the market needs. The inequality needed to serve as motivation breeds unhappiness and crime.
These aren't arguments to abandon capitalism, because it quite obviously is the best system we've found so far. But that shouldn't preclude us from trying alternatives, especially in niches that are so different that the outcomes may be different from the traditional production of physical goods.
Capitalism as ideology is a bit different. For example, if someone is rich, they are higher status, but not only that - they are assumed to have innate characteristics that make them better, such as discipline and intelligence. We've created, and this predates capitalism and allowed for its spread, a social system that equates wealth with social power.
That's a part of capitalism as an ideology. Another part is that people automatically view things in terms of cost. They weigh choices in monetary terms, as opposed to social, moral or physical.
I disagree with your example of capitalist inefficiency, as well - you've chosen a price equilibrium inefficiency but you're using that example to illustrate that a product is ill-suited for capitalism. It isn't; if the movie was priced correctly, the inefficiency would disappear. Plus, as you pointed out, there are negligible costs for distribution (it's not really zero, but who cares) so profits on a product like that would be significant. That seems to me to be a better product for capitalist exploitation than wheat.
I wasn't trying to. I was saying that it works well as a means of organisation, before pointing out its weaknesses. Ideology is when you ignore those weaknesses, and try to shoehorn everything within the framework of capitalism.
> If the movie was priced correctly, the inefficiency would disappear
The problem is that it's hard to price it efficiently, because the value is different for different people. You can try price-separation, i. e. by geography, or the cascade of movie theatre to download to broadcast TV. But there's still a loss of welfare. As another example: I will never pay for a subscription to the WSJ, or to Adobe Creative Cloud, or to NGINX Plus. But my life would be marginally better if I had access to these products. And the only reason I don't is because there's no way to allow people like me access, without also allowing those free access that are currently paying.
Is global warming a large problem? Because it would seem the destruction of the environment is highly profitable under the current system.
What is a more important problem, having a environment to live in, or being able to use fossil fuels?
Due to our evolutionary past, humans are more focused on the physically nearby, the present and very near future, so capitalism fails when we have longterm wide-scale problems to solve, like climate change.
In principle yes, but there are ways to game the system. Marketing is very good at creating false problems and aim consumers at them. Many of the things we work at are pretty much useless.
Furthermore having the richest pay for development of new technologies which are then later on distributed to the poorer is in my view the right direction it basically indirectly taxes the rich first.
Tesla would never have been successful if they started with cars for everyone. The fact that they made it a desirable item, to begin with, worked to their advantage. A better place is an example of the wrong strategy.
To me, this reads more like a PR piece than anything else.