"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.""
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.
ChatGPT and friends look magical, but as yet no great revolution in working practices or whatever has occurred. So the excitement about AI is based on 'very large future promise', which is exactly the kind of thing that ultra low interest rates tend to pump.
I know a bunch of people who are very excited about AI and using it in a professional context. Their feelings are inspired by demonstrated and past performance, the future promise is so big that I don't think anyone can process it. I don't think they understand what exponential growth in processing power implies.
> the future promise is so big that I don't think anyone can process it.
Sounds like a sentence that was taken from some pulpiteer's sermon when talking about god or afterlife. In other words: this promise is rather some nice fairy tale for some naive nerds and investors who love to believe in it.
> I don't think they understand what exponential growth in processing power implies.
This is very easy: for the data points (x_i, y_i), you can draw a decent straight line through the data transformed data points (x_i, log y_i). Thus: exponential growth is just some fancy term for "we do linear regression/linear Taylor approximation in this transformed space". I'm deeply impressed by such deep mathematics *sarc*.
Although "we do linear regression ... in this transformed space" is correct, it also isn't an attempt to understand what exponential growth in processing power implies. That is an attempt (really, a success) at providing a definition of what exponential growth is [0].
[0] Ironically, ChatGPT doesn't usually make that mistake, because it always tries to be calm and helpful it consistently makes a better-than-human attempt at reading comprehension whenever I've interacted with it.
Looking back, what use do you think you would have today by having it in university? I'm asking because I don't think such a help solving the exams would have helped in your career later. Yes, would have made an easier university time, and left you less prepared for after that. We can (continue to) use ChatGPT for everything, it's just this will be also eroding our own capacity to do that thing, less exercise of our mental muscle. Maths and puzzles are said to help maintaining mental health with age, by outsourcing them to AI we also lose faster our own I.
You're being melodramatic. Humans have made extensive use of tools since well before the dawn of recorded history. There is nothing unusual about someone wanting to use a tool.
I find it easier to learn when someone (now, something) intelligent is on hand to explain the material. You both must be geniuses or psychics, because otherwise it is not clear how you gentlemen intend to learn otherwise.
Investors in the dot com bubble looked at a straight line and thought it would extend forever.
Now investors are looking at an exponential line, expecting it to extend forever. It probably won’t and some will be disappointed.
Ultimately, predictions of the future always look rosier and more advanced than reality.
Progress is inexorable, undeniable, and arrives in unexpected ways.
Indeed! But as yet it is still just future promise - not much has materialized at large scale so far (to my knowledge - maybe copy writing? Seems to be a push back against obviously AI scripted content though).
A counter example might be spreadsheets - their introduction revolutionized book keeping (and lots of other things too). We wait to see whether AI will have a similar impact (I suspect it won't).
"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)
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.
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.
Technology has alas eroded property rights. We no longer own our vehicles, our cars, our tvs: anything with a computer now has an elaborate contract outlining whatever rights the seller seems to grant us, which can be changed at any time.
Anti-circumvention law applied massive legal weight to this, preventing the world from delving in & understanding the various devices around us. Which is now often defined by millions of lines of code, compiled down to devices, anyhow.
Whether the seller is free to create arbitrary restrictions & constraints on usage during sale, or whether the buyer is free to use purchases as they may is a huge tension here.
And there have been so few corrective actions or regulations to tilt things back in people's favor. GDPR a small collection of rights to data, but does nothing to help enlighten us as to the machines & their functioning. This all feels so infernal, trapped by law which doesn't let us look, trapped by machines where the mechanism inside is often inaccessible & invisible.
This... This is capitalism. Consolidation of big companies ruling their fiefdoms? That was what capitalism was literally doing until the various consumer and worker protections were slowly and painfully developed.
I believe it’s a good thing if the HN crowd steps out of their bubble and inform themselves a bit more on topics of capitalism, socialism and communism.
I feel more and more that those in power - the capitalists - have done a tremendous job of conditioning us from birth in the last 100+ years that capitalism is “the only way”.
Yet if you read a book like “Debt: the first 5000 years” by David Graeber, it put things into perspective. And there is so much more to read.
For those who say things like "what about USSR or North Korea": the problem there is/was not the socialism (or communism) but the authoritarianism. They're different axes on the political compass. Authoritarian state socialism is but one of many forms. Social democracy is structurally anti-authoritarian. "Laissez-faire" policies - the pseudo-populist alternative - actually gravitate toward government/industry collusion, often in the form of faux privatization of government functions. That's a cornerstone of fascism, which has its own sordid history and also seems to be where we're headed.
Also, learn the difference between a political system and an economic one. Of course they're related (see "collusion" above), but it's a mistake to act as though they're the same thing.
How can a socialist system exist that is not inherently authoritarian? If someone refuses to follow the coordinated economic plan (e.g. contributing to a welfare state) then ultimately the state will have to punish them somehow.
How can a capitalist system exist that is not inherently authoritarian? If someone refuses to follow the rules ... you get the idea. The only difference is that they become the authority instead of being punished by it, but the practical effect on the vast majority is the same. See: Stalin's USSR vs. Putin's Russia. Different in theory, but both authoritarian and both imperialist and both (not coincidentally) very oppressive toward any kind of minority.
Again, this issue is orthogonal to the economic model. Authoritarianism can and does exist in every economic system. The antidote IMO is institutions which define and enforce rules without bestowing permanent favor on any one group. Democracy, federalism, checks and balances, yadda yadda. I even mentioned social democracy already. But don't take my word for it. I suggest you actually study the issue for yourself, not just polemics from one side but the actual history of how these systems have developed and the theories that have been developed with them over centuries, then reach your own conclusions. They might not be the same as mine, but I guarantee they'll be even further from the laissez-faire extremists.
The difference is that with communism a natural human desire is punished, while in capitalism it gets rewarded. I mean a desire to do a good for himself, and only himself, ignoring the needs of the others. Maybe we don't like it as the society, but that's the people's nature.
It seems that it's more effective to leverage this natural desire (as in capitalism) rather that punish it (as in communism). The important part is "natural", i.e., people are born with it, as well as animals, and you cannot prevent it. That's not a minority at all. So the only way for communism is to constantly fight it on a great scale, which is possibly with turning into a authoritarian government.
I think there’s a misunderstanding about what communism is and that “natural human desire”, well what doe it mean, really? I’ve heard this narrative before but it sounds so self-serving.
Does it have to punish? At some scale yes maybe. But if the state tried to automate many of the essentials, it might be able to provide basics (food shelter sanitation) at extremely low marginal cost.
Ideally the planned state leaves room for art and culture. Who how and where the state supports creative endeavors is an open question. I'd ask similarly for open source. Ideally the state provides some spare capacity for individual development, that people can establish themselves with & start getting rewarded for.
Overall I see such a starkly different view. Coersion into behaviors & punishment seems low on my list of concerns for non-authoritarian communism.
(to me) every system become authoritarian (or worst) if the full spectrum of alternatives are not made and preserved possible whenever possible..
Putting capital (or socialism, growtn etc) as ultimate goals, and not tools, are on he higway to the disaster, how much of the actual economic/financial global system will exist if at every step in the development the pool of basic rights and true alternatives are respected more...
(to me) progress is (mainly) the creation of alternatives and possibilities.
similarly, someone says progress is actually the speed of the race but not it's direction..
Graeber's book was easily one of the most annoying books I've read in the last 10 years. It's worth reading though in the same way that some bad movies are worth watching - it will give you the chance to figure out just what's wrong with the world view it espouses and you can't really appreciate the critiques of it unless you know the source.
The chatty style (tourist journalism?) of the article detracts from the proposition that readers want to understand.
FTFA: "We’re now in servitude, Varoufakis argues, to the fiefdoms of our new global masters, Lord Zuckerberg of Facelandia and Sir Musk of the rotten borough of X."
tl;dr The working people live as interest serfs in an economy that has become impossible to afford for many. Meanwhile, enormously wealthy people have unchecked power over politics, technology, and public policy. These wealthy people can alter the workforce and fund movements according to their unrestrained and unscrupulous caprices.
Public policy in the US is in tatters (and is under heavy strain elsewhere), affordable lodging is a quaint hypothesis, and the current middle class cohort (i.e. anyone with what used to be a good salary) is trying to characterise its debt despair as temporary embarrassment.
Ultimately I've firmly believed that the problem is investors and public companies. Investors tend to warp the economy solely to suit their needs as the rent-seeking class, which results in negative effects on how a company is ran because the needs of the shareholder are often against the needs of the customer and the worker.
Both privately owned companies and worker owned companies tend to have far less issues in this regard and helps stymie the cycle of capitalism. Grocery stores are an example of where our choice is increasingly non-existent because all grocers operate under the same company.
38 comments
[ 3.5 ms ] story [ 280 ms ] threadSounds like a sentence that was taken from some pulpiteer's sermon when talking about god or afterlife. In other words: this promise is rather some nice fairy tale for some naive nerds and investors who love to believe in it.
> I don't think they understand what exponential growth in processing power implies.
This is very easy: for the data points (x_i, y_i), you can draw a decent straight line through the data transformed data points (x_i, log y_i). Thus: exponential growth is just some fancy term for "we do linear regression/linear Taylor approximation in this transformed space". I'm deeply impressed by such deep mathematics *sarc*.
Implications involves things like https://ourworldindata.org/brief-history-of-ai + little extrapolation. Interestingly, as I look at that article, it appears AI is actually solving college level math now - https://blog.research.google/2022/06/minerva-solving-quantit.... I wish I'd had that when I was at University.
[0] Ironically, ChatGPT doesn't usually make that mistake, because it always tries to be calm and helpful it consistently makes a better-than-human attempt at reading comprehension whenever I've interacted with it.
Looking back, what use do you think you would have today by having it in university? I'm asking because I don't think such a help solving the exams would have helped in your career later. Yes, would have made an easier university time, and left you less prepared for after that. We can (continue to) use ChatGPT for everything, it's just this will be also eroding our own capacity to do that thing, less exercise of our mental muscle. Maths and puzzles are said to help maintaining mental health with age, by outsourcing them to AI we also lose faster our own I.
I find it easier to learn when someone (now, something) intelligent is on hand to explain the material. You both must be geniuses or psychics, because otherwise it is not clear how you gentlemen intend to learn otherwise.
Indeed! But as yet it is still just future promise - not much has materialized at large scale so far (to my knowledge - maybe copy writing? Seems to be a push back against obviously AI scripted content though).
A counter example might be spreadsheets - their introduction revolutionized book keeping (and lots of other things too). We wait to see whether AI will have a similar impact (I suspect it won't).
"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
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.
Anti-circumvention law applied massive legal weight to this, preventing the world from delving in & understanding the various devices around us. Which is now often defined by millions of lines of code, compiled down to devices, anyhow.
Whether the seller is free to create arbitrary restrictions & constraints on usage during sale, or whether the buyer is free to use purchases as they may is a huge tension here.
And there have been so few corrective actions or regulations to tilt things back in people's favor. GDPR a small collection of rights to data, but does nothing to help enlighten us as to the machines & their functioning. This all feels so infernal, trapped by law which doesn't let us look, trapped by machines where the mechanism inside is often inaccessible & invisible.
Yes, painfully. See, for example, Battle of Blair Mountain https://en.wikipedia.org/wiki/Battle_of_Blair_Mountain
I feel more and more that those in power - the capitalists - have done a tremendous job of conditioning us from birth in the last 100+ years that capitalism is “the only way”.
Yet if you read a book like “Debt: the first 5000 years” by David Graeber, it put things into perspective. And there is so much more to read.
Also, learn the difference between a political system and an economic one. Of course they're related (see "collusion" above), but it's a mistake to act as though they're the same thing.
I do think we've been heavily trained to do this however.
Again, this issue is orthogonal to the economic model. Authoritarianism can and does exist in every economic system. The antidote IMO is institutions which define and enforce rules without bestowing permanent favor on any one group. Democracy, federalism, checks and balances, yadda yadda. I even mentioned social democracy already. But don't take my word for it. I suggest you actually study the issue for yourself, not just polemics from one side but the actual history of how these systems have developed and the theories that have been developed with them over centuries, then reach your own conclusions. They might not be the same as mine, but I guarantee they'll be even further from the laissez-faire extremists.
It seems that it's more effective to leverage this natural desire (as in capitalism) rather that punish it (as in communism). The important part is "natural", i.e., people are born with it, as well as animals, and you cannot prevent it. That's not a minority at all. So the only way for communism is to constantly fight it on a great scale, which is possibly with turning into a authoritarian government.
Ideally the planned state leaves room for art and culture. Who how and where the state supports creative endeavors is an open question. I'd ask similarly for open source. Ideally the state provides some spare capacity for individual development, that people can establish themselves with & start getting rewarded for.
Overall I see such a starkly different view. Coersion into behaviors & punishment seems low on my list of concerns for non-authoritarian communism.
Putting capital (or socialism, growtn etc) as ultimate goals, and not tools, are on he higway to the disaster, how much of the actual economic/financial global system will exist if at every step in the development the pool of basic rights and true alternatives are respected more...
(to me) progress is (mainly) the creation of alternatives and possibilities.
similarly, someone says progress is actually the speed of the race but not it's direction..
FTFA: "We’re now in servitude, Varoufakis argues, to the fiefdoms of our new global masters, Lord Zuckerberg of Facelandia and Sir Musk of the rotten borough of X."
tl;dr The working people live as interest serfs in an economy that has become impossible to afford for many. Meanwhile, enormously wealthy people have unchecked power over politics, technology, and public policy. These wealthy people can alter the workforce and fund movements according to their unrestrained and unscrupulous caprices.
Public policy in the US is in tatters (and is under heavy strain elsewhere), affordable lodging is a quaint hypothesis, and the current middle class cohort (i.e. anyone with what used to be a good salary) is trying to characterise its debt despair as temporary embarrassment.
Both privately owned companies and worker owned companies tend to have far less issues in this regard and helps stymie the cycle of capitalism. Grocery stores are an example of where our choice is increasingly non-existent because all grocers operate under the same company.