That's not the fault of VCs or even private equity. That's the fault of decisions made at far higher levels: congress, the executive branch, and the Federal Reserve. These decisions create vast macroeconomic riptides that just drag everyone else along.
One of the things I've come to believe after being around for a while and watching a lot of humans is that we are much more at the mercy of our environment and the forces therein than we think. Individual humans are very very small, and their decisions are largely driven by the socioeconomic context they inhabit. Incentives matter a lot.
Today there is effectively a Cold War between the US, China, and to some extent other nations and nation-blocs over who can print the most money to hep up their economy the most to generate the most GDP growth. All those metrics are financial in nature. You get what you measure. You also get ghost cities (China), crazy asset bubbles (America), predatory leveraged capital (everywhere), and a financial economy increasingly disconnected from value creation, but those things are not being measured so nobody (in the political class) cares.
This creates an incentive structure best parodied in the Silicon Valley TV series: your company's product is not its product. Your company's product is its stock. The goal is to soak up as much of that financial capital as possible, because that's where the money is.
This is why I wonder if humans are actually intelligent or just clever. Seems to me that a true intelligence would learn to command its own game theoretic / emergent context, not be dragged along by it to wherever the magic bus is going.
You think we are intelligent? We are as dumb as it gets. All kinds of misery remain throughout the world. We didn't solve any of the most important matters in human existance including: hunger, literacy, dignity, health, food quality, all kinds and grades of violence, mental disease, war, child abuse, women abuse, men abuse, justice, people without a roof, dictatorships, sanitation, pandemics...
"Because the quest for profit makes men into predatory, insensitive and stupid brutes." (Raoul Vaneigem) (http://www.notbored.org/sine-mensuel.html)
Maybe we are just barely smart enough. There is a statistical argument to the effect that the species to do X will in all probability be the dumbest possible species capable of doing it. E.g. if we are ever visited by aliens they are likely to be the stupidest possible interstellar voyagers...
One of the things I've come to believe after being around for a while and watching a lot of humans is that we are much more at the mercy of our environment and the forces therein than we think. Individual humans are very very small, and their decisions are largely driven by the socioeconomic context they inhabit. Incentives matter a lot.
Today there is effectively a Cold War between the US, China, and to some extent other nations and nation-blocs over who can print the most money to hep up their economy the most to generate the most GDP growth. All those metrics are financial in nature. You get what you measure. You also get ghost cities (China), crazy asset bubbles (America), predatory leveraged capital (everywhere), and a financial economy increasingly disconnected from value creation, but those things are not being measured so nobody (in the political class) cares.
This creates an incentive structure best parodied in the Silicon Valley TV series: your company's product is not its product. Your company's product is its stock. The goal is to soak up as much of that financial capital as possible, because that's where the money is.