Search Results for: socialism

Socialism: A Gift You’d Exchange?

After reading and reviewing a book by a socialism critic, I then did a book by an advocate. Then some told me “No, here is the advocate book you should have read.” I tried one of them: Nathan Robinson’s Why You Should Be a Socialist, said to be “A primer on Democratic Socialism for those who are extremely skeptical of it.”

Robinson won’t commit himself to what exactly is socialism’s proposal, other than pushing for big changes in light of some vague and widely-shared values (mostly equality and democracy). He says conservatives are mean and liberals are wimpy; liberals have similar goals, but are to be disdained for not calling for bigger changes. Yet the only specific changes he’ll clearly endorse are smaller changes widely endorsed by liberals. I’ll get to some of those below, but instead of writing a whole review, I’d rather make one big point, riffing off of these quotes: Continue reading "Socialism: A Gift You’d Exchange?" »

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Socialism Via Futarchy

On Bryan’s recommendation, I just read Niemietz’s Socialism: The Failed Idea That Never Dies, which credibly argues that two dozen socialism experiments over the last century have consistently failed, with roughly this pattern:

The not-real-socialism defence is only ever invoked retrospectively, namely, when a socialist experiment has already been widely discredited. As long as a socialist experiment is in its prime, almost nobody disputes its socialist credentials. On the contrary: practically all socialist regimes have gone through honeymoon periods, during which they were enthusiastically praised and held up as role models by plenty of prominent Western intellectuals. (More)

Noteworthy results from the latest experiment:

The number of worker-run cooperatives increased from fewer than 1,000 when Chávez was first elected to well over 30,000 in less than a decade. By the end of Chávez’s second term, cooperatives accounted for about 8% of Venezuela’s GDP and 14% of its workforce … It soon became clear … that many cooperatives were behaving like capitalist enterprises, seeking to maximize their net revenue … For example, rather than supplying their products to local markets … export them to other countries where they can sell them at higher prices … Also, many cooperatives have refrained from accepting new members. … As Chávez himself said: … if we are 20 in a cooperative, we are going to work for the benefit of us 20, and that is merely capitalism. Cooperatives need to be impelled towards socialism.’ (More)

Even after so many very expensive experiments, they still apparently have only have the vaguest idea of what detailed arrangements might actually achieve what they want. It seems they have mainly waited until an allied group gained control somewhere, and then tried a few random variations that resonate with local supporters.

There still seems to be great passion in the world for further socialism experiments, but it seems hard to hold much hope if they continue with this pattern. While I’m not personally very inspired by the socialist vision, I do like for people to get what they want, and that includes people who want socialism. So I’m taking the time to think about how to help them get it.

Which induces me to consider variations on futarchy to help to achieve socialism. If you recall, futarchy is a form of governance wherein market speculators choose policies to maximize an ex-post-measured welfare measure. The thicker are these markets (perhaps via subsidies), the stronger are the incentives for speculators to learn what is actually effective in achieving that welfare. This seems a good match, if what socialism most needs now is less a good system and more a good learning environment in which to search for good systems.

The big question for futarchy-based socialism is: what are the ex-post-measurable outcomes that indicate a successful socialism? That is, how would you know one when you saw it? Obviously you’d want to include some basic consumption measures, like G.D.P., but if that’s all you maximize there’s no obvious reason why the result will be especially socialist. You might include risk-aversion over consumption, which punishes inequality to some degree, but again it isn’t obvious that risk-aversion greatly favors socialism. Even more directly and strong punishing inequality and emphasizing the poor doesn’t obviously favor any more socialism than we see in high-redistribution low-regulation capitalist Nordic “social democracies”.

Consider:

Socialism is … characterised by social ownership of the means of production and workers’ self-management of enterprise … Social ownership can be public, collective or cooperative ownership, or citizen ownership of equity. (More)

What all socialism has in common … is … bottom-up governance of society based on local assemblies which elect delegates that share their peoples’ living conditions, can be overridden, answer to and are replaceable by them, who can federate into councils and repeat the process for larger areas and amounts of people. (More; see also)

It seems that to many a central concept of socialism is each person having a high a degree control (also called “ownership”) over their world, including both their immediate world and the larger economic/political world. This is not just control to enable one to achieve high consumption, but also control over one’s workplace, and probably even more control than is required for these purposes. In this view, successful socialism is a world of busybodies with strong abilities to get into each others’ business.

To promote socialism then, we might try a futarchy whose welfare measure includes not just measures of consumption, but also of control.

For example, one measure of control would ask random people to try to induce particular random changes in their world. The stronger the correlation between actual changes afterward and the changes that we randomly assigned them, the more we’d say that people in this world had a lot of control over it. But we’d need to find some widely-accepted weights that say which possible changes count for how much, and we’d need ways to get people to actually try to change their world in the ways we assign them. These seems hard to achieve. Also, this would probably find near zero control for larger social structures, no matter how things are arranged. And we’d need to find ways to prevent this world from suddenly becoming more plastic to support test changes, while less supporting non-test changes.

Also, I worry that simple-minded measures of individual control might induce many decisions to be made via big xor trees. Such trees would seem to let anyone who controls inputs to any leaf of the tree determine the root as well. Though of course in practice not being able to predict the other inputs means you can’t actually usefully control the output. But can we formally define average individual control in a way that doesn’t promote such xor trees?

Probably the simplest solution is to just survey people about their sense of control over their world. You might want to emphasize people who’ve recently visited other worlds, so they can reasonably compare their world to others. And you’d want to limit the abilities of local authorities to force people to give desired survey answers, such as via the threat of retaliation. If a strong central government were part of a socialist society, that may also make it difficult to measure consumption. Such governments have been known to try to distort consumption stats to make themselves look good.

One solution to these problems would be to rely on capitalist foreigners, and on travel to visit them, for both market speculators and welfare measurement.

That is, let random citizens (perhaps whole families) of the socialist society be extracted periodically and made to visit a capitalist foreign land. During that foreign visit, they can be privately interviewed about both their sense of control and their consumption levels, and they can be offered the chance to stay in that foreign land. (Via offers with varying degrees of attractiveness.) Stats on what they said and on who chose to stay could then be used to estimate the welfare of that society, without allowing that socialist government to retaliate via knowing who said what. Foreign speculators could also pay to talk privately to these visitors, to help inform their market speculation choices.

In this scenario, this socialist society would, to help it more quickly learn what works best, commit to delegating to these capitalist foreigners the measurement of its welfare and substantial participation in their speculative governance markets. Of course people at home within this socialist society could also be allowed to speculate in these markets, and to contribute to stats read by foreigners. But this approach avoids extreme corruption problems by making sure that foreigners can speculate, and measure welfare, in ways that are outside of the control of a perhaps powerful socialist government.

Of course if this approach eventually settled on a stable solution for making a good socialist society, they might want to drop this external futarchy run by foreigners to become entirely self-governing. That would make sense if and when full self-governance became more important than faster learning about how to make socialism work.

And that’s as far as I’ve thought for now. Of course if sufficient interest were expressed in this concept, I could put in some more thought.

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Who Wants Social Insurance?

During the Biden administration, we will hear many argue that we should hand out more benefits to more people. Now when we economists argue for policy, we usually make economic efficiency arguments. So it is worth noting that for many of these policies, the main economic efficiency rationale for such handouts is “social insurance”. We are already seeing related arguments regarding pandemic relief and school loan forgiveness.

The “social insurance” argument posits a scenario where many people would have wanted to buy private insurance against big risks that they (or their descendants) face, but private insurance markets failed to offer such insurance. And thus the government should step in and produce the effect that such insurance would have produced, which is to pay certain people in certain situations, and tax everyone else to pay for it.

Now it is certainly true that insurers don’t offer all possible kinds of insurance. This can be due to legal restrictions, transaction costs, and information asymmetries. But it can also be due to limited demand. What if most people don’t actually want the insurance that “social insurance” would provide?

We already see many puzzling patterns in common insurance choices. Insurance was long illegal most everywhere, but then in the 1800s the first big retail success of insurance was life insurance sold to husbands as a way to signal devotion to their wives. Today, people often insure small risks like a new piece of electronics breaking, but fail to insure many of the largest risks in their lives, like failures at school, career, or marriage. And when I’ve asked students if they want to insure against such big risks, most usually say no, they don’t.

To explore this further, I did some Twitter polls on willingness to pay for 15 kinds of risks. Here are those risks, sorted by the fraction of respondents who says they would find value in fairly-priced insurance:

Note that only a majority favors private insurance for the top six items, and private insurance is in fact available for all of these today. Note also that these results are from the 3rd version of these polls that I tried. I found smaller fractions wanting insurance in the 2nd and 1st sets.

Of course people aren’t always honest in polls; maybe they really do want to insure far more risks than they say. And the fact that people often push political systems for “social insurance” policies is supporting evidence. But equally plausible, I think, is the theory that many really just want to use government to induce transfers, but when those folks are economists they try to justify such plans using econ efficiency lingo.

A clean test would be for the government to offer fairly-priced insurance against many risks, to ensure that no market failures prevents the availability of such insurance. Or even to subsidize such insurance. If there were actually a market failure preventing such insurance, that seems the most direct way to fix the problem. Yet we almost never see proposals like this; people almost always just push for more handouts. I wonder why.

Added 9a: The usual insurance “market failures” are:

  1. Moral hazard – which government can only fix if it can see more private acts than can private insurers.
  2. Adverse selection – which can be solved by requiring purchase of private insurance, and whose existence requires the opposite correlation between risk level and insurance quantity than the one we usually see,
  3. Scale economics – which private insurers might also achieve if not forbidden by antitrust rules.

To get private long term insurance, we could let kids sign insurance contracts when young, or empower their parents or grandparents to agree on their behalf. Note that today parents could, but usually do not, implement partial poverty insurance by insisting that their richer kids transfer to their poorer kids. As more than half of of national income variance is of this within-family form, this could achieve more than half of the gains possible from poverty insurance within a nation. And parents are much better placed than government to adjust for moral hazard of varying child efforts.

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Prestige As Mob-Enforced Dominance

Humans distinguish two kinds of status, about which we are quite moralistic. There’s the good kind, prestige, and the bad, dominance. These are commonly described as pro-social vs. selfish:

Social status can be attained through either dominance (coercion and intimidation) or prestige (skill and respect). (more)

As Machiavelli noted, love [prestige] and fear [dominance] are both valuable assets that can be used to influence others. (More)

Dominance: Deference is demanded and is a property of the actor.
Prestige: Deference is freely conferred and is a property of the beholder. … Creation of authentic and lasting relationships … High in need for affiliation; high in authentic pride. (more)

Back in 2015, my co-author Kevin Simler argued for a “more cynical” view:

Central question [about prestige is] … What’s in it for the admirer? I know of two answers … first is given by Joseph Henrich and Francisco Gil-White … second … by Amotz Zahavi … and … Jean-Louis Dessalles … This [second] account may be more cynical, perhaps, but it’s one of the most powerful ideas I’ve ever encountered.

Henrich and Gil-White [say] … admiration … acts as a bribe. Admirers … are sycophants. … hoping to learn from their superiors. …

[But I say] prestige [is] … a kind of “credit” reflecting the amount of good each [babbler bird] has done for others. … Prestige-seeking and admiration (deference) are complementary teaming instincts. They help babblers stay attached to a group, keep groupmates happy, and secure a larger share of the group’s reproductive “spoils.” …

We [humans] voluntarily follow our leaders (and otherwise defer to them) because good things tend to happen when we do; it pays to be on their team. A leader who tries to command entirely with dominance — all stick, no carrot — will find his efforts thwarted at every turn … we want to be friends, allies, and teammates with people who do good things for their friends, allies, and teammates. [we] cultivate access to such people … by paying them respect and granting them the perks of prestige. …

Pinker … says, [prestige] is “the public knowledge that you possess assets that would allow you to help others if you wished to.” … Among our ancestors, then, bullies quickly got their comeuppance — unless they offset their dominance with a lot of prestige, creating many friends and allies in the process. (More)

But honestly, this view doesn’t seem that cynical to me. As they say, “hold my beer”. Consider my last post:

Elite employers … focus overwhelmingly on prestige when picking junior employees. … don’t that much care about your grades, what you’ve learned, or what you did in your jobs or extracurriculars, as long as they were prestigious. … Even though you have been chosen for your very consistent lifetime pursuit of prestige, that is very much not allowed to be one of your main goals. … What they are mostly selling is a prestigious aura around [their] advice. … Customers who paid as much for less prestigious advice would probably also be punished, via others being less willing to praise or follow that advice. (More)

Firms in this scenario aren’t just “freely giving” prestige, nor is this about learning, “love”, “authenticity”, nor rewarding generous allies. These firms instead face strong incentives from audiences to assign prestige in the way that key audiences think prestige should be assigned.

Consider academic “peer” review. Reviewers formally decide who gets how much prestige. But if they gave good reviews “freely” to whomever they most “authentically” “loved”, they might not get invited to review again, and their own prestige may suffer. When you hope to gain prestige by hosting an academic conference, you will be punished if you don’t invite the speakers that your key audiences think you should invite.

Or consider “cancelling”, which is in effect a form of negative prestige. While I still have my job, many events and organizations tell me that they can’t afford to publicly invite, fund, or associate with me because of what mobs say about me. They say they don’t personally have a problem with anything I’ve said or done, but they don’t want the hassle that mobs could impose.

In all these cases, we aren’t at all looking at each person just “freely” assigning to others the respect and evaluation that they privately think appropriate. Instead, evaluators face strong conformity pressures to agree with the evaluations of others.

Both dominance and prestige are expressions of power. In dominance, the power is direct, what that person can do to or for you. But with prestige, the power is indirect, enforced via a local mob. You must “freely” accord each person the respect that your relevant mob says is due, or risk their wrath. But make no mistake, there is a power that enforces prestige, just as with dominance.

Note that “socialists” tend to explicitly frame unequal money or physical power as unacceptable “domination”, and yet greatly admire historical cases where outraged and active mobs tried to fix such problems.

Added 6Nov: Mercer & Sperber’s Enigma of Reason similarly assumes that while those who present arguments might be biased, evaluators of arguments are neutral and fair.

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The Socialist Manifesto

As I’ve read criticisms of socialism, I thought I should read some advocates. This seemed promising:

Bhaskar Sunkara, The Socialist Manifesto: The Case for Radical Politics in an Era of Extreme Inequality (April 2019) … What, exactly, is socialism? And what would a socialist system in America look like? The editor of Jacobin magazine, Sunkara shows that socialism, though often seen primarily as an economic system, in fact offers the means to fight all forms of oppression, including racism and sexism. The ultimate goal is not Soviet-style planning, but … to create new democratic institutions in workplaces and communities. A primer on socialism for the 21st century.

I’ve just finished it. Alas, the vast majority of its 288 pages is an “inside baseball” history of socialist movements in history. Who inspired them, ran them, and joined or supported them. How they allied with and fought each other and outsiders, and rarely, what policies they pushed for or how they ran things. Generally, Sunkara’s heros are those who “called for” the most “radical” change, regardless of their actual impact on people or policies.

Amazingly for something called a “manifesto” and “primer”, there’s little effort to argue for why socialism is good; we are supposed to find that obvious. More on that below.

Yes, big failures like Stalin’s Soviet Union and Mao’s China are acknowledged, but blamed on their being insufficiently “democratic”. Sunkara doesn’t discuss why that seems to happen so often, nor how to stop it from happening again. The actual socialist-like government that he seems most willing to embrace is that of Sweden until a few decades ago. But he has little discussion of why Sweden has since moved far away from that, other than to blame it on business media campaigns and bad strategy choices by politicians.

Much is packed into Sunkara “democracy” concept, as he often blames the failure of socialists to gain more influence as due to capitalist influences on votes. Apparently any elections done within capitalism can’t be fully “democratic.” The US today is also said to be “undemocratic” because our system tends to favor having two main parties. Sunkara also says having things decided by local governments is less democratic, as capitalists have more influence at smaller scales. Sometimes merely voting is seen as insufficiently democratic; Sunkara instead prefers the pressure that comes from mobs, especially mobs willing to break the law. I don’t really see a coherent “democracy” concept here, other than that “democracy” is whatever leads to Sunkara’s favored policies.

Socialism is said to be the solution not only to inequality and oppression, but also to racism and global warming:

People can overcome their prejudices in the process of mass struggle over shared interests.

Democratic socialism would do far better at keeping humanity flourishing along with the wider ecology. …Worker-controlled firms don’t have the same ‘grow or die’ imperative as capitalist ones. A more empowered citizenry, too, would be better able to weigh the costs and benefits of new development.

Though Sunkara does call for

avoiding a narrow ‘call-out culture’ along with the kinds of identity politics that, taken to its extreme, will lead us down the path to a hyper-individualized and anti-solidaristic politics. Hyperbole and the politics of personal shaming are a recipe for demoralization, paranoia, and defeat.

So what exactly is “socialism”? It is not the end of competition or inequality. Under socialism, there is still personal private property allocated by competitive markets. Romantic and friend relations are set by competitive markets for association. Competitive labor markets still allocate jobs, which result in differing wages and working conditions. People compete under democracy to see who gets to run firms and the government, and people compete to gain government approval to start and grow firms:

Collectively you and your coworkers now control your company. … You have to pay a tax on its capital assets, in effect renting it from society as a whole. … Everyone [must] participate in management on an equal footing. … [Your firm picks] a representative system of governance. … From the unit supervisor’s perspective, she has the duty to make sure everyone is doing their share. [A lazy worker] goes through a progressive disciplinary process – first comes a warning, with concrete suggestions for improvement, then a suspension with pay, then finally, dismissal with three months of severance. …

There is still market competition, and firms still fail, but the grow-or-die imperative doesn’t apply. … There’s pressure to make sure janitorial and other ‘dirty’ jobs are well compensated. …

Capital goods tax … funds are invested into … national planning projects. What’s left is given to regions on a per capita basis … channels by regional investment banks (public of course) that … apportion … to new or existing firms. Applicants are judged on the basis of profitability, job creation, and other criteria including environmental impact. … These tradeoffs are political decisions. … Since you’re starting the firm, you have some discretion in setting the initial operating agreement. … To attract workers [you decided on] income differentials. … you are rewarded for your invention with a small amount of state prize money, and you do end up earning more as an elected manager.

Sunkara says that you wouldn’t be scared to lose your job as you “can get by on the state’s basic income grant and supplement it by taking a guaranteed public sector job.” No mention is made of savings, so it seems you can’t forgo consumption today to save more for you or your children’s future.

Sunkara offers this as his definition of “socialism”, but he doesn’t do anything to assure us that others agree with his definition. From what I’ve read before on the subject, there’s a lot of disagreement on that question.

I have serious doubts that such a system will work as well as familiar ones for choosing products and methods of production. Why are they better for creating efficiency and growth, or for happiness and meaning? Seems to me people would try a lot less hard to figure out better ways to do things. They’d instead figure out how to pander to and lobby the more ignorant politicized panels that allocate capital. As we’ve seen in “socialist” regimes before.

You probably have such doubts too. Yet Sunkara offers zero arguments to allay our fears. No theory arguments. No systematic data comparing how different systems have worked in practice. Not even a few detailed anecdotes on which we might hang our hopes. Nothing, other than perhaps invoking a faith that more democracy must improve all things.

To anyone tempted in the future to write a “manifesto” for some radical proposal, I suggest: actually argue for it. With theory, data, anecdotes, something. And you’d do best to argue for particular concrete trials to test your proposal. Call for more such trials, but don’t call for everyone everywhere to adopt your proposal in the absence of generally positive results from a series of trials of increasing scale and difficulty.

Given how much experience the world has had with regimes that were called “socialist”, I don’t see how anyone could seriously propose more of it without a review of some data drawn from these experiences. While we do have some such data regarding “democracy” of various forms, that data isn’t especially encouraging. Data on government panels deciding what new production ventures to try, and what old ones to maintain, seems to me even more sparse and less encouraging. But do show us that’s wrong, if you can.

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Yay Stability Rents

Six years ago I posted on the idea of using combinatorial auctions as a substitute for zoning. Since then, news on how badly zoning has been messing up our economy has only gotten worse. I included the zoning combo auction idea in my book The Age of Em, I’ve continued to think about the idea, and last week I talked about it to several LA-based experts in combinatorial auctions.

I’ve been pondering one key design problem, and the solution I’ve been playing with is similar to a solution that also seems to help with patents. I asked Alex Tabarrok, whose office is next door, if he knew of any general discussion of such things, and he pointed me to a long (110 page) 2016 paper called “Property is another name for monopoly” by Eric Posner and Glen Weyl. (See also this technical paper.) And that turned out to be a relatively general argument for using the specific mechanism that I was considering using in zoning combo auctions, get this, as a new standard kind of property right for most everything! Looking for web discussion, I find a few critical responses, and one excellent 2014 Interfuildity post on the basic idea. In this post I’ll go over the basic idea and some of its issues, including two that Posner and Weyl didn’t consider. Continue reading "Yay Stability Rents" »

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Info Ideology

What is a political “ideology”? You might think your ideology is your set of core pivotal beliefs, the few beliefs that most influence your many other political beliefs. For example:

Political ideologies have two dimensions:
Goals: how society should work
Methods: the most appropriate ways to achieve the ideal arrangement.
… Typically, each ideology contains certain ideas on what it considers to be the best form of government (e.g. democracy, theocracy, caliphate etc.), and the best economic system (e.g. capitalism, socialism, etc.). … Ideologies also identify themselves by their position on the political spectrum (such as the left, the center or the right), though this is very often controversial. (more)

But in fact, political ideologies seem more to be the beliefs that most consistently divide us:

For the most part, congressional voting is uni-dimensional, with most of the variation in voting patterns explained by placement along the liberal-conservative first dimension. … since the 1970s, party delegations in Congress have become ideologically homogeneous and [more] distant from one another (a phenomenon known as “polarization.”) … [These] scores are also used by popular media outlets … as a measure of the political ideology of political institutions and elected officials or candidates. … [These] procedures … have also been applied to a number of other legislative bodies besides the United States Congress. These include the United Nations General Assembly, the European Parliament, National Assemblies in Latin America, and the French Fourth Republic. … Most of these analyses produce the finding that roll call voting is organized by only few dimensions (usually two): “These findings suggest that the need to form parliamentary majorities limits dimensionality.” (more)

It is a remarkable fact that a single dimension so well summarizes political opinions, especially given the range of topics relevant to politics. This, however, is not plausibly explained by saying that we mainly disagree about one core key belief, such as how much redistribution is fair. It instead seems to reflect how political coalitions form – groups tend to form alliances more with closer groups, against more distant groups, until two main alliances form, divided by their one strongest division, whatever that might be.

To the extent that the main political dimensions are associated with policies, they are mostly associated with lots of particular policies, instead of a few key principles. And this makes sense given that most voters seem incapable of comprehending and reliably applying most proposed political principles.

But if there really were sensible pivotal principles, and if the relevant political population could understand and apply them, then it would make sense to focus our political arguments on them. By aggregating info on a few key principles, we would more efficiently aggregate info on lots of specific policies.

So do sensible and pivotal political principles exist? To me, principles like maximize liberty or minimize inequality seem pivotal, but not very sensible. I’m more fond of the principle of economic efficiency, but it is pretty hard for ordinary voters to see what more specific policies this principle implies.

To me, the most sensible pivotal principles are at the meta level — they are about how exactly we should aggregate info on the efficiency, and other consequences, of policies. For example, I think decision markets can go a long way toward giving us better info on the effects of policies. I also think we should do a lot more randomized policy experiments. And I support more and better cost benefit analyses, though it is admittedly hard for ordinary voters to evaluate their objectivity.

Now these positions might be wrong, but whatever are the right answers, the question of how to best aggregate info on policy effects seems a pivotal core issue, with strong implications for many specific policies. Amid audiences that can understand them, these are the core issues about which we should argue. Info ideologies would be the best ideologies.

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The Poor Don’t Revolt

A standard myth:

Once upon a time, poor masses suffered under rich elites. Then one day the poor realized they could revolt, and since then, the rich help the poor, fearing the poor will revolt if they ever feel they suffer too much.

Revolution experts mostly reject this myth; famous revolutions happened after things had gotten better, not worse, for the poor. Yet Matt Yglesias (responding to Bryan Caplan responding to me) seems to echo this myth:

Another way of putting it would be Simon (i.e., plenty) for capital and Malthus (i.e., subsistence) for labor. That, of course, is Karl Marx’s vision of long-term economic development. And while I don’t have a strong opinion as to whether or not this is accurate over the long term, it’s certainly a plausible story about the future, and Marx’s solution—socialism—unquestionably seems to me to be the correct one. Marx’s forecast of the immiseration of labor and all the returns going to the owners of capital clearly hasn’t been true in the 150 years or so since his time, but it certainly could happen. … If the robots are sentient beings, then we’d presumably be looking at an eventual slave revolt and Communist revolution.

Matt claims that if sentient robots are poor, they must eventually revolt. Karl Smith responds:

The robots will be EMs. But, … they will likely remember having been stems [= flesh and blood people]. … This means the robots get the ability to feel jealousy right along with the ability to engineer new products. … However, the analogy isn’t as Matt suggests a return to the late 1800s. It’s a return to the 1600s. The Stems won’t be capitalists. … The Stems will be landed gentry. …

The EMs will likely not be slaves because there will be no reason to enslave them. The rent on land will exceed the profits from running a slave operation. Lastly the EMs will not revolt because there will be little to gain. … Stems are extremely wealthy because you are taking a tiny slice of a huge amount of economic output and then giving it to an incredibly tiny fraction of the population.

I doubt it matters whether a tiny elite, presumably including most humans, owns capital or land. But Karl is quite right about the key point: poverty does not by itself lead to revolt. While a transition could be rough, once the world is in a Malthusian equilibrium there’s no particular reason to expect trillions of ems to revolt, any more than ancient farmer masses did, or most of the world’s poor today.  (Current “Arab Spring” revolts are driven more by under-employed well-educated.)

Keep in mind that in a Malthusian world, even if future robots could grab all the capital or land, it would be worth only a modest fraction of total wealth, and a revolution could threaten the productive system on which they all depend.

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Life Is Scarce

Matt Yglesias:

Simon (i.e., plenty) for capital and Malthus (i.e., subsistence) for labor. That, of course, is Karl Marx’s vision of long-term economic development. And while I don’t have a strong opinion as to whether or not this is accurate over the long term, it’s certainly a plausible story about the future, and Marx’s solution—socialism—unquestionably seems to me to be the correct one. … If the “robots” are really mere machines, then it should be easy to peacefully divide up the surplus more-or-less equitably, we’ll transition to socialism and everyone will be happy—it’ll be like Star Trek. If the robots are sentient beings, then we’d presumably be looking at an eventual slave revolt and Communist revolution.

Karl Smith:

Is it possible that Health Care is 160% of GDP? What this is telling us, is one way or another health care costs will not continue to rise faster than the overall economy. … The question before you is, do you want the world where health care is limited only by our collective ability to pay for it. What many elites don’t face up to is that if you asked this question to the person on the street he or she might very well say yes. I am constantly aware of this because a persistent source of tension between myself and my family is their feeling that it is not just ok but morally imperative that personal budget constraints be hit in the purchase of medicine. … Making the case for less health care spending is making the case for abandoning the sick and the needy. If you want a world that does not proceed on autopilot you need to be gearing up to make that case. Slight of hand about cost-savings or market efficiencies is not going to do the trick.

When I describe a Malthusian future where most (robot) people wouldn’t live much longer than they were near the best in a very competitive labor market, many readers react like Yglesias, and talk of revolution. Surely, they suggest, no moral person would accept a society where how long folks lived depended greatly on how much they could pay.

Like Karl Smith above, a month ago I tried to make the point that even without robots we are heading toward such a world:

A fountain of youth pill whose required dosage doubled every decade would either have to be banned, or given to everyone over thirty with insurance. … Eventually we’d run out of money to pay for these pills; we’d have to say no to some people, and then they’d quickly die. … Good thing we don’t have a fountain of youth pill, right? Actually, our real situation is worse. Per capita medical spending in the US doubles about every fifteen years, which is still much higher than our economic growth rate. Yet we struggle to see any substantial correlation between health and medical spending – our medicine is mostly useless on the margin. Its nothing like a fountain of youth pill. Our refusal to say no to any medical treatment that seems to our wishful-thinking eyes like it might help will also bankrupt us. And we won’t even get a fountain of youth in the bargain.

One way or another we will find a way to exclude seen-to-be useful medicine from people in our society. The only question will be: what will be acceptable criteria for such exclusion? I’ve argued that the ability to produce enough wealth to pay for your added life is a decent criteria for such a choice, and it can be implemented in an admirably flexible and decentralized way. If you reject that criteria, what other criteria will you substitute, and what price are you willing to pay in centralized regulation and lessened innovation and competitiveness with the rest of the world?

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Young Heads, Old Hearts

If a man is not a socialist in his youth, he has no heart. If he is
not a conservative by the time he is 30 he has no head.

Francois Guisot (1787-1874) said this first re “republican” while French Premier Georges Clemenceau (1841-1929) changed it to “socialist”, and many others, including Winston Churchill have since said similar things. But new results seem to conflict:

We presented 60 younger and 60 older adults with health care choices that required them to hold in mind and consider multiple pieces of information. … The emotion-focus condition asked participants to focus on their emotional reactions to the options. … The information-focus condition … instructed to focus on the specific attributes, report the details about the options, and then make a choice. … Decision quality data indicate that younger adults performed better in the information-focus than in the control condition whereas older adults performed better in the emotion-focus and control conditions than in the information-focus condition. …

Fluid intelligence, that is, deliberative/effortful processing, peaks early in life followed by a steady decline thereafter. This component of intelligence comprises several subcomponents that all show consistent age-related decline including speed of information processing, temporary storage of information (i.e., short-term memory), and the storage and manipulation of information (i.e., working memory). Emotional processing, in contrast, appears to be well maintained at older ages.  More important, this selective preservation of emotional processing is found even in working memory. …

Previous research has linked this age-related emphasis on emotion-regulatory goals to preferential processing of emotionally salient and positively valenced material among older relative to younger adults. … In advertising contexts, older adults prefer and better remember ads with emotionally meaningful appeal whereas younger adults prefer and better remember ads with knowledge-related appeal.

So do young folks actually choose socialism with their heads, or are they mistakenly listening to their hearts instead of their heads?  Do old folks actually reject socialism with their hearts, not their heads?  Do we even know that old folks actually like socialism less than young folks?

Added 11:30a: Four (!) comments point to OKCupid results suggesting young and old adults are economically socialist, while kids and the middle-aged are not, for self-interest reasons.  People do seem to get more consistently socially restrictive with age, so maybe that is more tied to the young heads vs. old hearts trend.

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