Side Effects of the Growth of Wealth (1999) | Hacker News Reader

Side Effects of the Growth of Wealth (1999)

nytimes.com

80 pointshowrude24 comments

>Using the Microsoft Corporation as his benchmark, Mr. Luttwak says that the new high-tech titans produce much capital but relatively few new jobs. The rich get richer, but those driven out of work by the computer revolution are forced to take lower-paying service jobs. The unskilled they displace turn rationally to criminal activity like drug dealing.

Prescient.

Facebook is a $400B corporation, one of the world's most valuable, and it employs, what, 15k people? Before, your bigcorps like Carnegie Steel and Standard Oil employed hundreds of thousands.

We no longer need labourers for factory work, to fight wars, to flip burgers or drive trucks. People say that automation will only create more jobs and freedom, but I have a hard time believing that. Automation is the ultimate triumph of capital over labour. The rich don't need Middle America any more, because most Middle Americans don't have any worthwhile skills. Americans in "flyover country" are increasingly unemployed, filing for disability, and dying of opioid overdoses. And people wonder why Trump got elected.

I'm parroting the points made in this delightful talk here, by a YC alum no less: https://www.facebook.com/antonio.f.garcia.martinez/posts/101...

I think you are right that "automation is the ultimate triumph of capital over labour," but I'd really like to point out that knowledge capital is a huge part of this. Having an employable skill these days is becoming more and more synonymous with having some sort of knowledge capital, because essentially everything that doesn't require knowledge capital can be automated away.

>Americans in "flyover country" are increasingly unemployed, filing for disability, and dying of opioid overdoses.

That's not true in general, and it implies that states like California don't face these same issues. If you look at the unemployment rate of states, the 25 states with the lowest unemployment rates are all "flyover country." [1]

I think the root of these problems are caused by structural unemployment. Living in a flyover state is a great predictor of these problems, but it is not the cause.

1. https://www.statista.com/statistics/200017/state-unemploymen...

[stupid comment, deleted]

You have this backwards. New Mexico is #1 for unemployment only if you're going for a high score. Obviously, high unemployment should match low labor participation, which is what you see.

The numbers make a lot more sense than you think.

https://www.bls.gov/web/laus/laumstrk.htm

compares well with your link,

https://www.expresspros.com/Newsroom/America-Employed/Expres...

I wouldn't feel too secure about my knowledge capital if I were you- companies regard skills you obtained in their employ as their intellectual property and they're doing whatever they can to retain it. Right now they can't perfectly do that but in the future, that might change. It might happen by specializing roles to the point that it's just button pushing, or by noncompete agreements, etc.

> In the end, he offers no prescription for turbo-capitalism, merely predicts that "the wave of the future could be populism," the essence of which is always "a revolt of the less educated against elite rule, elite opinions, elite values and the elite's consensus on how government and the economy should be run."

Published in 1999. Sounds like he got at least some things right.

> As for Rule Three, it is for the non-Calvinists who reject Rule Two, "who are not paralyzed by guilt and who are too uneducated to express their resentment legally." For them "there is only one possible form of expression: to break the law, by engaging in criminal activities such as murder, armed robbery, violent assault, rape and the smoking of marijuana in pipes or home-made cigarettes." Followers of Rule Three end up in prison.

This feels really out of touch. Aside from the stilted language ("home-made cigarettes" in 1999, really?), lumping people who use marijuana with rapists and murderers is absurd. Might as well lump in people who jaywalk.

I think that might be the point.

Not everyone who jaywalks is following the third law, but jaywalking might be a good indication that you are! From what I can tell, the idea of those three laws is to emphasize the first two. Anyone who isn't falling for the mentality of the first two risks, by their 'out of the box' tendencies, being tossed in the clink with the rapists and murderers.

In ultra-capitalist America, they are saying, money's power is protected at the cost of some human freedoms, such as the freedom to smoke homemade cigarettes that didn't feed into the industry. If you don't make the sacrifices required by the first two laws, you might find yourself sacrificed. It's safest to conform.

There is definitely something in it when the article links turbo-capitalism to "the destruction of authenticity".

I find that wealthy people lack authenticity and more often than not, they seem to be completely unaware of their predicament.

They've seemingly lost their ability for self-reflection (if they ever had it) - That's why many of them trust financially-motivated personal growth gurus, success coaches, high-end psychologists and advisors to guide them.

A lot of wealthy people don't seem to fully appreciate that absolutely everyone around them is constantly trying to milk them - Eventually, they get so used to it that they start to think that they're living in some pink cloud surrounded by friendly people and they forget that these so-called friends always have their skinny hands on those fat udders of theirs.

How many wealthy people do you know? How do you know how much self-reflection they do?

Several, including a close family member and several relatives. I've also met lots of others and the pattern looks very clear to me.

The wealthy people I personally know do not follow the pattern you describe.

The plural of 'anecdote' is not 'data'.

What do you define as "wealthy"? And what "authenticity" do these people lack? The article doesn't define what "the destruction of authenticity" means (presumably the book does), leaving readers to make up their own definitions.

> They've seemingly lost their ability for self-reflection (if they ever had it) - That's why many of them trust financially-motivated personal growth gurus, success coaches, high-end psychologists and advisors to guide them.

I'd guess that wealthier people likely engage in more self-reflection (on average) because wealth affords them the opportunity to do so. As for all the personal growth gurus, coaches, etc., most of these people make their money off the middle class. It's not millionaires buying Tony Robbins books and attending his courses.

> A lot of wealthy people don't seem to fully appreciate that absolutely everyone around them is constantly trying to milk them

You really think wealthy people don't recognize that their wealth attracts this? The rest of the world sees this but not the wealthy? Wealthy people tend to spend their time with other wealthy people because of this.

> wealthy people lack authenticity

What is "authenticity"?

> seemingly lost their ability for self-reflection

???

From your tone, I would guess you feel offended that other people are richer than you so you're looking for ways to find faults with them to convince yourself that it's actually you who's superior.

Perhaps you should compare who is doing the most good to other people. To me, that's a more important quality than the nebulous ones you identified - "authenticity" and "self-reflection". You can always find some arbitrary trait that makes somebody you don't like look bad. Try "diligence", "humility", "intelligence", "motivation", "non-violence", "work ethic", "laziness" and see how your wealthy family members stack up then.

I don't see myself as superior. I'm jealous of wealthy people. My real motivation for writing the previous comment is that I'm just not good at pretending and so I'm bitter about missing out on opportunities because of that.

For example, I see that the kinds of people who get funding are those who are really good at presenting themselves in a particular way. You don't need to be smart, you just need to look/act smart, talk fast and tell the prospective investor exactly what they want to hear - In the current economy, only people who are really good at faking seem to succeed.

Those who are good at faking are those who don't realise that they're faking. "Fake it till you make it" is the name of the game. Nobody can lie better than those who lie to themselves.

Turbo-capitalism's full name is "suicidal, greedy, libertarian, utopian delusions worshipping anarchy and extinction, while scapegoating sensible democratic socialism (government and commonwealth) as 'the great Satan.'"

"The god of the market-worshipers that celebrate the glories of turbo-capitalism is Adam Smith, but theirs is a devotion that crucially depends on not reading him."

I found this amusing. It seems that fanatical devotion to dogmatic source texts is always predicated on not having read the source text to begin with. (Thinking the words in your head without digesting their meaning does not qualify as reading IMO.)

That kind of thing is the basis of a lot of crazy orthodoxies. For example Jehovah's Witnesses are often encouraged not to read the bible, but to read JW bibles or writings instead. It's incredibly easy to control people when you make insularity a virtue, and they buy into it.

A somewhat OT anecdote: I met one of my good friends in SF serrindipitously because... he was reading Wealth of Nations next to me at the cafe bar and I struck up a conversation with him about it. And perhaps naturally, he's as far from dogmatic devotion as one can get.

In fact, he warned of this very thing. No one listens.

Where, specifically?

(Genuinely curious, as I, too, strongly advocate actually reading Smith: https://www.reddit.com/r/dredmorbius/comments/4cyroa/adam_sm...)

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