Time for a status update on cultural drift. I’ve been pondering solutions, and now see at best only three weakly promising options. The other possible approaches seem to me at best only modest supplements to these three best solutions.
Much, if not most, of the problems we have today are not due to the lack of reining in those who are successful. The primary problem is not holding people accountable for their failures. Look at all the fraud perpetuated through government. Not one of the leaders will be held accountable. Or look at any of the many “well-intentioned” government programs that have created more harm, welfare, DEI.
As Thomas Sowell said, “"It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong".
Capitalism works wonders precisely because those who make poor decisions pay the consequences. Capitalism fails when decision makers are not personally held accountable.
Human history suggests a fourth option: Collapse leading to a decentralization of power. We see many, many cycles through history of the center collapsing and bringing back inter-civ competition. E.g. post-Roman Europe. Eventually the winners win and power centralizes again – and the cycle repeats. Maybe we're due for another reset.
I like the *idea* of cleverly engineering our way out of a painful reset. But I think the success prospects are dim. So painful reset it is.
I agree that a civ fall is the most likely outcome, to be replaced by Amish, Haredim & the like. But I'll continue to work to achieve something better.
Re. "We could change bequest and charity laws to let organizations that pay low tax rates primarily hold assets and reinvest their returns. If allowed to persist for generations, such orgs would accumulate most of the world’s capital." -- In the US, charitable foundations spend over $100 billion per year. I surveyed the top 10 US charitable foundations a couple of years ago, and 9 of them had been captured by woke boards, and spent most of their money on projects which excluded white males as beneficiaries. They were good causes, but very much aimed abroad rather than at the US, which is not what you want if your goal is to make the US adaptive.
Far-left organizations, including BLM in its early days, are mostly funded by far-left charitable money-laundering organizations, which accept money from the big foundations, then give it out to causes too radical and violent to be associated with the big foundations. Woke "grass-roots" activism today might not exist without these foundations and George Soros.
Charitable foundations left by billionaires are problematic bcoz billionaires trust accredited high-status people, meaning Ivy-league professors. The Big 3 mutual fund holders, BlackRock, Vanguard, and State Street, all force far-left policies onto the companies they control through their $31 TRILLION in other people's assets. They allegedly follow the guidelines in the 2020 Davos manifesto: "companies should pay their fair share of taxes, show zero tolerance for corruption, uphold human rights throughout their global supply chains, and advocate for a competitive playing field." (https://www.govenda.com/blog/the-shift-to-stakeholder-primacy) But in fact they do none of these things. They focus on climate change, DEI, and governance rules which encourage companies to put more ivy league professors on their boards.
All big institutions constitute big targets for ideological takeover. Almost all such big private institutions have at present been taken over by the far left. The financial power of the far left appears to about 3 orders of magnitude greater than that of conservatives and liberals combined as a result. So be careful what you ask for.
The broader point is that such orgs rarely make efficient capital allocation decisions. The whole premise of capitalism is that allocation decisions need to be made by those with a firm understanding of the details. Foundations, endowments, and the like rarely have the expertise. If they did then socialism would be feasible – a national sovereign fund could make all the decisions.
Concisely put. But this raises the question, "Can AI make socialism feasible?" And even if it can, I still don't want socialism.
I think the problem with socialism isn't that it's currently infeasible, but that its goal is to make decisions for everyone. /Socialism assumes everyone wants the same things./ If it functions perfectly, it would distribute a common basket of goods to everyone. No wide variety of music, or novels, or art; no alternative lifestyles; no non-standard marriage contracts; no subcultures; no social movements to allow new identities such as gay or trans. In fact it is easier for socialism if it erases even the male/female distinction wherever possible.
You could deal with this by allowing the founder of the institution to place real restrictions on how it's spent. Ex. Henry Ford would hate what the Ford Foundation has become. If he had some ability to set the bylaws of the org in an enduring way, probably things would turn out differently
> Making hostile takeovers of firms much easier would greatly increase competitive pressures to make firms efficient.
IMHO a bad idea. Our current system already fails to recognize the interest that long-term employees and long-term customers of a company, and sometimes the public in general have in not being screwed up in favor of investors - you do not want to give investors even more power without more completely recognizing and accounting for the interests of all relevant stakeholders.
"Making hostile takeovers of firms much easier would greatly increase competitive pressures to make firms efficient." You don't want this. One person's "this is inefficient" is another's "this is resiliant". One reason we don't have enough "looking to the future" in our firms is that if you do Private Equilty already comes along, restructures your company, and demands that you only look to the next 3 quarterly reports. The Boeing merger with McDonell Douglas was a Hostile takeover of Boeing in the name of promised improved efficiency. Boeing lost the ability to make safe planes. Your readers here can give you as many examples of "private equity stripped my company and left it to bankruptcy" as you like. It's what Private Equity does. Inefficiency in a firm, which does exist, is always better addressed some other way. This is the poster child for "cure worse than the disease". All the low-hanging fruit of incompetantly run companies has been picked decades ago. Don't go here!
Yes I find the more capitalism solution the most plausible and interesting one you've presented.
Long term investment orgs are particularly interesting - I like to think that allowing this type of thing would not just change rates of return and interest in the future but also induce more cultural variation through creating familial or dynastic orgs that grow in wealth and power over time and plausibly diverge at least a bit from the global monoculture.
Assuming investment rates of return include growth and profit, the idea that concentrating most of the world's capital into a few hands would lead to perfect competition is doubtful.
The low-hanging fruit here is still principal-agent problems within firms. A lot of consequential decisions are made based on status-seeking, or just vibes, by execs, and not in the interests of the firm's owners. And testing is feasible. What if there were a PE fund that expanded on Jeffrey Wernick's offer but made it non-optional? ( https://www.overcomingbias.com/p/hail-jeffrey-wernick ) On acquisition, re-structure management bonuses as stake money in the internal prediction market?
Robin, your distinction between capitalism and voluntariness seems to hinge on background conditions that shape people’s choices. I’m curious how you classify cases where no individual coerces anyone, but the system itself creates non-voluntary constraints. Do you see those as failures of voluntariness, or simply as features of any large-scale coordination system?
BTW, marriage was "capitalist" in many, maybe most, times and places, in that it was driven by financial and dynastic incentives. So there may be data with which to compare both approaches.
Re. "Yes, many other parts of our world, such as marriage, parenting, sex, friendship, and art, are mostly “voluntary”, but that’s not “capitalism” for my purposes here." :
It's very bad to open with that. It sounds like you want people pay for brides or grooms, buy their friends, and pay for all sex. Like you want to require people to get a receipt for love and friendship. That isn't even what you want. Please stop presenting such an easy target. So many of your posts sound like you're begging to be attacked. Your actual proposals are radical enough.
I would like art to be "capitalist" in the sense that the public should be able to vote on eg the architecture of monuments and public buildings, and on publicly-funded art, including the playlist of publicly-funded orchestras. This because we've had 100 years of modernist crap paid for by the public. But most art IS mostly capitalist, eg novels, paintings, home decor. It could be a lot more capitalist if we used the Internet to eliminate the middle-men, such as publishing houses.
As I said before, there's a difference between "less" and "zero". When you write "without new children every generation", you're assuming I want zero children born in the next generation.
In an actually capitalist system, we would have people buy education, each paying for however many kids they have, n no tax deduction per child. so that aspect is neither voluntary nor capitalist.
Much, if not most, of the problems we have today are not due to the lack of reining in those who are successful. The primary problem is not holding people accountable for their failures. Look at all the fraud perpetuated through government. Not one of the leaders will be held accountable. Or look at any of the many “well-intentioned” government programs that have created more harm, welfare, DEI.
As Thomas Sowell said, “"It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong".
Capitalism works wonders precisely because those who make poor decisions pay the consequences. Capitalism fails when decision makers are not personally held accountable.
Human history suggests a fourth option: Collapse leading to a decentralization of power. We see many, many cycles through history of the center collapsing and bringing back inter-civ competition. E.g. post-Roman Europe. Eventually the winners win and power centralizes again – and the cycle repeats. Maybe we're due for another reset.
I like the *idea* of cleverly engineering our way out of a painful reset. But I think the success prospects are dim. So painful reset it is.
I agree that a civ fall is the most likely outcome, to be replaced by Amish, Haredim & the like. But I'll continue to work to achieve something better.
Re. "We could change bequest and charity laws to let organizations that pay low tax rates primarily hold assets and reinvest their returns. If allowed to persist for generations, such orgs would accumulate most of the world’s capital." -- In the US, charitable foundations spend over $100 billion per year. I surveyed the top 10 US charitable foundations a couple of years ago, and 9 of them had been captured by woke boards, and spent most of their money on projects which excluded white males as beneficiaries. They were good causes, but very much aimed abroad rather than at the US, which is not what you want if your goal is to make the US adaptive.
Far-left organizations, including BLM in its early days, are mostly funded by far-left charitable money-laundering organizations, which accept money from the big foundations, then give it out to causes too radical and violent to be associated with the big foundations. Woke "grass-roots" activism today might not exist without these foundations and George Soros.
Charitable foundations left by billionaires are problematic bcoz billionaires trust accredited high-status people, meaning Ivy-league professors. The Big 3 mutual fund holders, BlackRock, Vanguard, and State Street, all force far-left policies onto the companies they control through their $31 TRILLION in other people's assets. They allegedly follow the guidelines in the 2020 Davos manifesto: "companies should pay their fair share of taxes, show zero tolerance for corruption, uphold human rights throughout their global supply chains, and advocate for a competitive playing field." (https://www.govenda.com/blog/the-shift-to-stakeholder-primacy) But in fact they do none of these things. They focus on climate change, DEI, and governance rules which encourage companies to put more ivy league professors on their boards.
All big institutions constitute big targets for ideological takeover. Almost all such big private institutions have at present been taken over by the far left. The financial power of the far left appears to about 3 orders of magnitude greater than that of conservatives and liberals combined as a result. So be careful what you ask for.
I'm talking about orgs that primarily reinvest their assets, and don't spend much.
The broader point is that such orgs rarely make efficient capital allocation decisions. The whole premise of capitalism is that allocation decisions need to be made by those with a firm understanding of the details. Foundations, endowments, and the like rarely have the expertise. If they did then socialism would be feasible – a national sovereign fund could make all the decisions.
For this purpose it is enough that they just invest in assets in proportion to total investment in those assets.
Concisely put. But this raises the question, "Can AI make socialism feasible?" And even if it can, I still don't want socialism.
I think the problem with socialism isn't that it's currently infeasible, but that its goal is to make decisions for everyone. /Socialism assumes everyone wants the same things./ If it functions perfectly, it would distribute a common basket of goods to everyone. No wide variety of music, or novels, or art; no alternative lifestyles; no non-standard marriage contracts; no subcultures; no social movements to allow new identities such as gay or trans. In fact it is easier for socialism if it erases even the male/female distinction wherever possible.
You could deal with this by allowing the founder of the institution to place real restrictions on how it's spent. Ex. Henry Ford would hate what the Ford Foundation has become. If he had some ability to set the bylaws of the org in an enduring way, probably things would turn out differently
> Making hostile takeovers of firms much easier would greatly increase competitive pressures to make firms efficient.
IMHO a bad idea. Our current system already fails to recognize the interest that long-term employees and long-term customers of a company, and sometimes the public in general have in not being screwed up in favor of investors - you do not want to give investors even more power without more completely recognizing and accounting for the interests of all relevant stakeholders.
Another of my suggestions would give capitalists a longer term view.
"Making hostile takeovers of firms much easier would greatly increase competitive pressures to make firms efficient." You don't want this. One person's "this is inefficient" is another's "this is resiliant". One reason we don't have enough "looking to the future" in our firms is that if you do Private Equilty already comes along, restructures your company, and demands that you only look to the next 3 quarterly reports. The Boeing merger with McDonell Douglas was a Hostile takeover of Boeing in the name of promised improved efficiency. Boeing lost the ability to make safe planes. Your readers here can give you as many examples of "private equity stripped my company and left it to bankruptcy" as you like. It's what Private Equity does. Inefficiency in a firm, which does exist, is always better addressed some other way. This is the poster child for "cure worse than the disease". All the low-hanging fruit of incompetantly run companies has been picked decades ago. Don't go here!
A different proposal in my list would make capitalists care a lot more about the long run.
I think it is going to take comprehensive legislative reform to make that happen, not limited to the proposals that Roger Martin made in _Fixing the Game_. nice summary here: https://www.forbes.com/sites/stevedenning/2011/11/28/maximizing-shareholder-value-the-dumbest-idea-in-the-world/
Yes I find the more capitalism solution the most plausible and interesting one you've presented.
Long term investment orgs are particularly interesting - I like to think that allowing this type of thing would not just change rates of return and interest in the future but also induce more cultural variation through creating familial or dynastic orgs that grow in wealth and power over time and plausibly diverge at least a bit from the global monoculture.
Dude. Your fantasy “capitalism” externalizes every negative consequence to non-users. You’re living it a contrived reality, Robin.
Heath and life insurers, merged together, is a great idea.
Assuming investment rates of return include growth and profit, the idea that concentrating most of the world's capital into a few hands would lead to perfect competition is doubtful.
The low-hanging fruit here is still principal-agent problems within firms. A lot of consequential decisions are made based on status-seeking, or just vibes, by execs, and not in the interests of the firm's owners. And testing is feasible. What if there were a PE fund that expanded on Jeffrey Wernick's offer but made it non-optional? ( https://www.overcomingbias.com/p/hail-jeffrey-wernick ) On acquisition, re-structure management bonuses as stake money in the internal prediction market?
Demeny voting should be at the center of any reform plan. Need to realign political power with those with a stake in the future.
Though not directly related, this post reminded me of the short story “The Moral Virologist” by Greg Egan.
An alternative question: What changes in physical or biological reality would lead to preferred cultural adaptation?
Few dystopian items that pop to my mind that its interesting to reflect on how these would impact cultural adaptation:
1. If it became common knowledge that massive meteor will destroy Earth in 200 years.
2. If a virus infected everyone and caused anyone who makes it to their 85th birthday to immediately and painlessly die.
3. If a virus infected everyone and made it so no one could pro-create after the age of 30?
Here is the short story: https://www.gregegan.net/MISC/MORAL/Moral.html
There isn't an Archimedean point whence entrepreneurs might create orgs that align incentives to remedy cultural drift.
And government begets "the big public failures."
I can't imagine what might work.
Robin, your distinction between capitalism and voluntariness seems to hinge on background conditions that shape people’s choices. I’m curious how you classify cases where no individual coerces anyone, but the system itself creates non-voluntary constraints. Do you see those as failures of voluntariness, or simply as features of any large-scale coordination system?
Any choice will have a larger context that constrains that choice.
BTW, marriage was "capitalist" in many, maybe most, times and places, in that it was driven by financial and dynastic incentives. So there may be data with which to compare both approaches.
Maybe for elites, but not for most peasants.
Peasants have the degenerate case with zero degrees of freedom. :)
Re. "Yes, many other parts of our world, such as marriage, parenting, sex, friendship, and art, are mostly “voluntary”, but that’s not “capitalism” for my purposes here." :
It's very bad to open with that. It sounds like you want people pay for brides or grooms, buy their friends, and pay for all sex. Like you want to require people to get a receipt for love and friendship. That isn't even what you want. Please stop presenting such an easy target. So many of your posts sound like you're begging to be attacked. Your actual proposals are radical enough.
I would like art to be "capitalist" in the sense that the public should be able to vote on eg the architecture of monuments and public buildings, and on publicly-funded art, including the playlist of publicly-funded orchestras. This because we've had 100 years of modernist crap paid for by the public. But most art IS mostly capitalist, eg novels, paintings, home decor. It could be a lot more capitalist if we used the Internet to eliminate the middle-men, such as publishing houses.
He actually DOES want to pay for more children. Below-replacement fertility means kids are under-supplied.
The idea that we need more kids is ideological not fact-based. Due to AI, I think we will need less kids.
There won't be any "we" without kids.
There's a difference between "less" and "zero".
Human lifespans are finite, so the population goes to zero without new children every generation.
As I said before, there's a difference between "less" and "zero". When you write "without new children every generation", you're assuming I want zero children born in the next generation.
In an actually capitalist system, we would have people buy education, each paying for however many kids they have, n no tax deduction per child. so that aspect is neither voluntary nor capitalist.
How education is paid for is orthogonal to his proposal.
we already pay for more children, via tax subsidies
He wants to pay a lot more than we currently do.