The optimism and hopefulness got crushed under the boot of money. The spirit of sharing got crushed under the boot of copyright. The joy and excitement got crushed under the boot of metrics and engagement. In an alternate timeline, things could have gone a different way, but because the same old money and same old power structures controlled the direction of progress, we got the timeline where the Internet turned into Addictive Pay-per-view Disney.
The authoritarian movements of the 20th century wouldn't have been possible without mass media. But it wasn't the profit motive that was the prime culprit for this enablement.
Ideologues found they had a powerful tool at their disposal to channel people's grievances towards an enemy, and to bind a large group of people behind this ideology.
The inventors of the printing press and the radio didn't intend for it to be used this way.
> The inventors of the printing press and the radio didn't intend for it to be used this way.
Well, at least the printing press was created to print the Bible - the "Gutenberg bible", named after its inventor, was the first mass produced book in the world [1], so it can be said that it was intended to get a large group of people behind an ideology.
Actually, no. The Gutenberg bible was not the goal of the printing press, although it might have been a business savvy move for a variety of reasons. We know that, possibly even before profitable Church orders of indulgences, it was used to print poem(s), of which one is still preserved in a museum, predating the bible by about 5 years.
Let me nitpick here. The fact that something was printed before the Bible doesn't prove that spreading the Bible was not, in fact, the primary motive to invent the printing press. It could just mean that Gutenberg went with smaller stuff first.
> we got the timeline where the Internet turned into Addictive Pay-per-view Disney
Call me a cynic, but I really think that was the inevitable outcome. It's just flawed human nature. Yes, there are outliers - good people who make and keep that vision to the best of their ability. But the overwhelming majority will always be there to drive it towards the dismal outcome you're witnessing now.
I think it's human nature under capitalism. I think before the 1800s there were loads of different societies that valued things like community and mutual support over "got mine".
This is the fundamental assertion of anarchism -- people generally like helping each other and like feeling useful. If basic needs were covered, we'd use most of our time doing things that felt meaningful, and those things would make everyone's lives better.
I mostly agree but propose another amendment: this is human nature under late-stage capitalism. Capitalism is pretty great in the beginning / middle, and can go on for a very long time in such a way that the interests of corporations, consumers, labor, and governments are all basically aligned. Late-stage is a very different game in all respects though.
One risk we are facing now is that when most of the people alive have only seen the perversions of unregulated and unapologetic late-stage capitalism, they will think this is what it always has to look like. The impulse to switch to a polar opposite or burn everything down is ill advised but becomes hard to ignore.
So many modern problems can be traced to 1971. [1] That is the year that the US defaulted on our obligations under Bretton Woods effectively ending the system and causing currencies to become completely fiat, enabling governments to effectively print unlimited funny money.
This perverts capitalism so hard because you now end up with tens of trillions of dollars being dumped into the economy in horribly inefficient ways and so behaviors that make one likely to get some of this become far more economically relevant than just making the best product.
Our current economic system is obviously completely unsustainable at this point and may well end up being one of the shortest lived economic experiments ever. That's particularly ironic because, as you alluded to, for most of everybody alive today this is just how it's always been!
> So many modern problems can be traced to 1971. [1] That is the year that the US defaulted on our obligations under Bretton Woods effectively ending the system and causing currencies to become completely fiat, enabling governments to effectively print unlimited funny money.
Correlation != causation. Yes, the end of Bretton-Woods certainly played its part, but there are other independent causes for most of the things that can be seen in the graphs - first and foremost, the oil crises of 1973 and later and the impact of the policies of Nixon, Reagan and Thatcher, as well as simple but massive technological progress that made the economical shifts (such as the decline in agriculture and industry as a share of the economy) possible in the first place.
Automation and IT in general are the largest drivers of the latter - more efficient and powerful diesel engines made a lot of farm labor all but redundant, and IT enabled constructing and orchestrating ever larger and larger things, all the way from machines to global sized corporations, and the resulting efficiency gains of scale were mostly looted by the rich elites.
There is one straight forward causal mechanism - excessive money printing sends the monetary supply skyrocketing and directly drives inflation.
It's not hard to deal with inflation for the wealthy. You will generally have substantial wealth invested in inflation resistant appreciating assets, businesses can pass the inflation on to the customer, and so on.
But for labor it's a different story. Not only do you suffer far more from price increases with little in the way of offsetting assets, but inflation allows wages to 'secretly' grow stagnant or even decrease.
What I mean is that since e.g. 2020, the CPI has increased by 18%. So if you're not earning at least 18% more, you're more earning less than you did in 2020.
Without inflation this doesn't work. Workers' raises would actually increase their real earnings.
It's not hard to see how this single issue causally drives much of what happened in 1971 (and beyond.)
Notably the excessive money printing began somewhat before 1971 which is what caused the default that eventually happened in 71.
Everyone agrees inflation is bad; what we don't yet really know is if it's worse than unemployment. The way the existing system works is if inflation starts to rise, the Fed raises the interest rate, hiring slows and people get fired, and this constricts the existing supply of money thus reducing inflation. But if you don't do that, and instead just put up with inflation, people get and keep jobs, so all you then have to do is make sure wage growth meets or exceeds inflation.
Politically this ended up not working (no pun intended). People explain this by saying losing a job affects that person whereas inflation affects everybody, but personally I put it down to the right demagoguing inflation as the sign of an incompetent government (it turns out it was transitory and the result of supply shocks--maybe not a good reason to throw millions of people out of work).
We'll never know the counterfactual, but the US managed this economic environment better than any of its peers, so honestly I don't know what a good faith criticism would even look like.
A term you definitely want to look up is "exporting inflation" which is largely why the US has thrived while others - well not so much. [1] This manifests in many ways, but I'll offer a simple example. The US remains the largest consumer economy in the world. So imagine you're Carland where your economy is mostly selling cars, and mostly to the US. And now imagine the US prints a bunch of money causing their currency to become worth less relative to yours.
At a first level analysis this sounds great because now you get even more dollars per car! But in reality that's not what happens. Instead US customers can't afford your cars anymore and so turn elsewhere and your economy, which is dependent upon the US, would start to decline and possibly even crash. So the solution? You print money and intentionally weaken your own currency - helping to eliminate the relative US inflation! Now the US inflation has transformed into real growth (for Americans) and you've 'imported' their inflation, but can at least continue selling your cars. So your economy stumbles on for another day while the US economy only grows larger.
But in contemporary times many of the factors that enable the US to export its inflation are gradually declining. And when you look at many of our economic indicators, without any particular 'superpowers', it's not so pretty. For instance our peers in debt:GDP ratio (4 worse, 4 better) are: Greece, Italy, Bahrain, Maldives, Laos, Cape Verde, France, and Bhutan. Not exactly the economic peers one wants.
I don't doubt inflation moves between economies. I just don't think there's any evidence that US monetary policy causes the negative outcomes you're outlining through that movement. I think you can do a China, but the US doesn't do that.
Click the link. It's impossible to have a reasonably educated conversation on this topic if you don't even understand how the US exports its inflation. It's an absolutely fundamental part of modern international economics (which is why you'll also find about a zillion links on it).
I read the top 10 articles from that link, as well as a study on the magnitude of the effect. None of them provide any evidence that printing money in the US (which is inflationary, i.e. it weakens the USD) creates inflation in other countries. Rather they show the opposite: a strengthening USD causes it. Of course this would also happen under a non-fiat currency (imagine say the US just wins a world war), so I still don't know what your point is.
You're fundamentally misunderstanding in a way akin to arguing that 'I've seen no evidence that destroyed homes cause tornadoes.'
The US printing money doesn't allow it to export its inflation, but rather exporting inflation allows the US to print far more money than other countries without comparable inflation. In fact we even relatively economically weaken other countries in the process of it.
This is why countries with comparable debt to GDP ratios are generally in very poor economic shape while the US is near its economic peak in most typical measurements.
But this superpower is fading in ways you presumably now understand, but the decades of money printer go whrrrr, and the unbelievable debt hole it left, remains.
Trying to handle a debt whose interest alone has now exceeded a trillion dollars a year is not going to be realistically possible without funny money or the emergence of some new economy booming industry akin to the birth of computing/internet.
> The US printing money doesn't allow it to export its inflation, but rather exporting inflation allows the US to print far more money than other countries without comparable consequences.
I didn't see this dynamic outlined in the link OP provided, can you point it out or explain it? Are you just saying when the USD strengthens we have more ability to print money and thus weaken it? If that's case, from a monetary policy point of view, isn't that just avoiding deflation? Or from a trade policy point of view, don't our trading partners want us to print money to weaken the dollar and thus stop exporting inflation?
This line of argument is untethered from reality. Please explain why the US exported inflation pre-Bretton Woods (we totally did) and what you'd do to stop it (nothing, because this is the natural consequence of a currency strengthening, which occurs with or without a fiat system). Please explain why currencies fluctuate even when pegged to commodities (they totally did, deflation was a huge problem in the Great Depression).
> This is why countries with comparable debt to GDP ratios are generally in relatively poor economic shape while the US is near its economic peak in most typical measurements.
Here's a list of countries around the US' ratio:
- Singapore: 1.75
- Greece: 1.59
- Italy: 1.36
- Bahrain: 1.26
- Maldives: 1.21
- US: 1.21
- Laos: 1.15
- Cape Verde: 1.12
- France: 1.11
- Bhutan: 1.11
- Barbados: 1.07
- Spain: 1.06
- Belgium: 1.05
- Canada: 1.04
- UK: 1.01
Is your argument that France, Canada, the UK, Japan, Belgium, Spain, Italy, Greece, and Singapore are all some of the best places on Earth to live despite some deep economic dysfunction (that--again--has produced absolutely no ill effects)? Or are you gonna argue that Bahrain's major problem is their debt-to-GDP ratio?
> the US is near its economic peak in most typical measurements.
> But this superpower is fading in ways you presumably now understand
You can't have it both ways: either 1971 was the beginning of the end or we're currently at peak because of our unique (to be clear it's not at all unique) ability to export inflation. The only argument you (any anyone else on your side) has left is that an unspecified reckoning will come at an unspecified time.
To be less polemic, Piketty postulates that the kind of GDP growth we've experienced the last couple centuries is wildly unsustainable (he gets into like, galactic terms, pretty entertaining). It's likely that growth levels off, like it is in places like the EU, US, China, and Japan, and we'll need new economic policies that don't assume perpetual >5% annual growth. I would guess that means debt to GDP ratios actually start mattering, but I'm not that convinced economists know anything and I know even less than they do, so yeah.
You need to take a break and actually think about what you've claimed to have read about exporting inflation.
A few hours ago you had no clue what it was, and skimming a few articles has not yet meaningfully improved upon that.
FWIW - I wrote this after starting to respond to the strong USD vs exporting inflation nonsense. Again you're having a 'I don't understand why destroyed homes cause tornadoes' moment.
I enjoy a good debate but this nonsense on loop paired with your somewhat bizarre belief that places like Japan are great to live (for average locals) is too much.
wtfhappenedin1971 has approximately 17,000 graphs showing wage suppression. I will 100% eat shit on this if you can show real evidence that QE (printing money, whatever) is the main cause of wage suppression.
It is exactly what has happened over the past 4 years, spread out over 50 more gradually. Since January 2020 CPI is up 23%. If you received a 5% raise each year the past 4 years, you'd have a real lower wage today than you did 4 years ago. People are not inclined to complain about "gifts" of raises, yet those raises quantifiably do not keep pace with inflation. The problem is that this is invisible for the vast majority of people. How can I be earning less even though I'm now making $xxxx more than last year? Workers' wages stagnate while companies are able to reap the benefits of reduced labor costs.
You can also see this with things like the minimum wage. In 1968 the federal minimum wage was $1.60. Inflation adjusted that's $14.42. Places like California/Washington think they're being progressive with their minimum wage ideas, but it's simply trying to take us back to before 1971, except with all of the problems that the 50 years in between have caused such that the quality of life that money will provids will likely remain dramatically lower than it would have provided in 1971.
> People explain this by saying losing a job affects that person whereas inflation affects everybody, but personally I put it down to the right demagoguing inflation as the sign of an incompetent government (it turns out it was transitory and the result of supply shocks--maybe not a good reason to throw millions of people out of work).
The problem is, prices didn't fall (mostly due to corporate greed - corporate profits exploded in comparison with inflation [1]), and many people are worse off than they were prior to the pandemic, even after some of them got wage increases that in many cases didn't even come close to matching inflation.
The Biden administration could have done more to combat this but didn't, and Trump campaigned on that failure. The real issue is that the US desperately lacks any viable third party option which means, combined with the radicalization of the Republicans over the last decades, that there is no way of holding the Democrats accountable without electing ever more utter crazies.
> The problem is, prices didn't fall (mostly due to corporate greed - corporate profits exploded in comparison with inflation [1])
Sure, but again this is a political problem. I don't the WH was promising prices would fall; I think the Fed was saying they'd get inflation back to 2% while also balancing their employment mandate. People may have expected prices to go down, but again that's a political problem.
Full agree on the greed thing though, and that would have been an easy out for the WH: somehow publicly punish gougers.
> and many people are worse off than they were prior to the pandemic, even after some of them got wage increases that in many cases didn't even come close to matching inflation.
I'm parroting here, but didn't wage gains outpace inflation? Do you have different data? Are there other ways in which people are worse off (there might be)? My current understanding is that inflation wasn't a big deal, wage gains outpaced it, but Republicans demagogued it.
> The Biden administration could have done more to combat this but didn't, and Trump campaigned on that failure
Agree! The Biden admin was uniquely bad at politics.
> The real issue is that the US desperately lacks any viable third party option which means, combined with the radicalization of the Republicans over the last decades, that there is no way of holding the Democrats accountable without electing ever more utter crazies.
You lost me here. I'm a fan of ranked choice voting and getting money out of politics, but any third party would be subject to all the corrupting dynamics affecting the other two.
This comes up on HN all the time [0] and it's complete garbage. Japan has a fiat currency; how have they dodged inflation? Where are the successful non-fiat economies? If there's some kind of moral hazard with printing money, why is one of the Fed's 2 mandates to keep inflation at 2%? Why aren't they constantly printing money? Why isn't inflation 1000%? How long do we have to wait for this conspiracy theory to prove out?
Japan is probably not the example you're after as it isn't the country many of us remember from back in the day when it was rivaling the US for economic dominance. Their economy has been in recession/stagnation for about 3 decades now. Their stock market is now finally above where it was in 1989, up 1.5%. [1] Though that will probably be short lived, especially as their population is now dying off fast enough that even places like Tokyo are declining in population! It's a great recipe for affordable housing, keeping inflation manageable, and much more. Probably not an advisable path to go down though!
An example of a successful non-fiat economy would obviously be the US. Until 1971 we had various forms of backing to our currency. After 1971 we invented this abomination of a system which probably only lasted as long as it did thanks to the growth of digital technologies making infinite growth, to meet infinite debt, briefly sustainable, all be it only with rather dramatic consequences, particularly for the lower half of society.
The only real problem the Japanese economy has is their top-heavy population, which isn't a result of monetary policy.
By your own metric of Japan's failure (stock market value), the US economy has excelled tremendously since 1971 (yes, even adjusting for inflation), so now I'm confused about what argument you're making. I also assume all the other points I made stand.
The point with Japan is that their economy is completely stagnant. It's entirely possible to see a healthy growing economy without having runaway inflation. Again, the US was the obvious example. The Campbell's Soup Index is quite a visible illustration of how radically things changed. But with our current system you get endless inflation that negatively affects vast swaths of the population to the benefit of a relatively small percent. Or you get Japan - which went from competing for the world's largest economy to having a dead economy.
As a side note, population age ratios are directly determined by fertility rates. And we went from a system where people were comfortably raising family on a single income, to one where full time workers living alone are, in many cases, not exactly thriving, let alone trying to raise a whole family on that income. Most developed economies are seeing fertility rates plummet and it's entirely possible that monetary policy is indeed playing some potentially significant role in that!
I like the Japan example because they are a modern economy that is absolutely maniacal about inflation, yet their quality of life is very high and their currency floats. Fiat hawks can't countenance this, and have some Rube Goldberg explanation about how floating currencies cause declining birth rates which lead to the only problem the Japanese economy really has.
Aside from there being so, so many other reasons for declining birth rates (if less money means less likely to have kids, why do people with higher incomes or wealth have lower birth rates than those without?), Japan doesn't print money: its inflation is famously low. How can a country with famously low inflation experience declining birth rates due to high inflation from printing money?
My friend you are again severely lacking knowledge here. Saying Japan doesn't print money is like saying that 2+2=5. They are literally the founding fathers of modern quantitative easing and also one of the clearest examples of why it's not really a productive policy in anything beyond the shortest timeframes.
It seems you are more a fan of writing than reading, but this link would be informative. [1]
Sorry I maybe followed what I thought was your argument too far. I thought you were saying fiat currencies create a moral hazard in monetary policy where regulators will be motivated primarily by short term economic growth at the expense of inflation or ultimate collapse under debt. Japan obviously doesn't do this, their growth is minimal (if you could QE your way to 8% GDP growth I'm sure they'd do it) and they have yet to collapse under their debt (debt to GDP ratio is purely hypothetical).
In other words, that article is junk, mostly telling goldbugs what they want to hear. Let's look at some real metrics. Japan's the 4th largest economy in the world. They have reasonably good income inequality. They do have a child poverty problem but this is almost certainly the result of entrenched gender roles--it's very hard for single mothers to be sole providers there. Their neonatal mortality is extremely low, their HDI is super high, their literacy and education rates are very high, their life expectancy is very high, etc etc etc. Unless you think switching to a gold standard would magically fix deeply rooted sexism, I don't know what you're arguing for here. Mostly, it just seems like you pot-shot various economies, which is way easier than running one (another argument I made you failed to respond to).
They're in fact now the 5th largest economy [1], behind Russia and India. And they'll keep going down.
And this was the point - the reason you are able to use them as an example of a country that endlessly prints money without being ravaged by the countless problems places like the US have suffered since 1971 is because their economy is basically frozen in time. This is undesirable.
The ideal one wants is an economy that can increase at a healthy rate without being ravaged by everything we've seen since 1971. And what's the solution? Practically everything before 1971!
To belabor this petty point, they're 4th in nominal and 5th in PPP. Ugh.
> And they'll keep going down.
Yes, because of population issues. Not because they'll be overtaken by powerful non-fiat economies (both the ruble and rupee float as does every currency AFAIK).
> And this was the point - the reason you are able to use them as an example of a country that endlessly prints money without being ravaged by the countless problems places like the US have suffered since 1971 is because their economy is basically frozen in time. This is undesirable.
Without granting that it's "frozen", what's undesirable about it? It sounds nice TBH.
> The ideal one wants is an economy that can increase at a healthy rate
The growth we've seen since the Industrial Revolution is unsustainable. Growth requires energy, and at some point the energy requirement either can't be met, or the heat exhaust from the conversion boils the oceans. Grim, I know.
> without being ravaged by everything we've seen since 1971
Life is so much better than it was in '71 I don't even know where to start. Are there problems now? Of course. Are literally any of them caused by Bretton Woods? Absolutely not.
> And what's the solution? Practically everything before 1971!
Feel free to go down the list of pre-Bretton Woods economic crises I posted and explain why they happened despite everything being better then.
The end of the Bretton-Woods agreement is not the root cause; that in and of itself is downstream of the US government prosecuting a bullshit war in Vietnam for the last decade and change. To be clear, this is not the US government "perverting capitalism", this is the capitalist class abandoning a fiscal constraint they found inconvenient in order to continue a pissing match against the existential threat of communism. There is no world in which capitalism stays under a "sound money" gold standard, stops fighting interventionist wars, and doesn't immediately either get cornered by the Soviet Union[0] or obliterated by an ascendant American left.
With few exceptions, the government in the US acts on behalf of the capitalist class, not in opposition to it. There is no "pure" capitalism that would exist if the government just left free markets alone. Capitalists won't leave the free market alone. Capitalists will take ownership and control over the chokepoints of the economy, government or no[1], granting them their own sovereign territory they can levy taxes on. This is a state - a monopoly on the legitimate use of force - whose territory is not of a city or a nation but of a market niche.
This system is sustainable in some ways and not in others. Yes, the market is distorted, which means it sucks for us, but the people who own the market-state don't actually feel that punishment. Which means they won't stop. Something has to actually force them to stop.
[0] Analogous to how the PRC has cornered the modern neoliberal west today.
[1] To be clear, nation-states are also culpable in this process, both through sins of omission (failing to enforce antitrust law) and sins of commission (creating legal monopolies that form new economic chokepoints to conquer)
But Bretton Woods is indeed the root cause, because the entire system was a bit of a Trojan Horse (or at least turned into one). Why doesn't any random country just go print trillions of dollars, import what they can't locally produce, and boom - call themselves an advanced economy? It's because demand for their currency would plummet in other countries, and in their own country they'd do little but create runaway inflation and probably become the next Zimbabwe.
But when the US did this it was very different because with Bretton Woods we had already established the USD as the global currency to be used in international trade and settlement everywhere. So countries were unable to move away from the dollar as fast as they could other currencies. And in the interim we started setting up the Petrodollar to prevent them from doing this - by making it impossible to buy the most in-demand commodity in anything other than USD - making fighting against the dollar futile.
But one of Biden's many 'accomplishments' was pushing Saudi Arabia far away enough that they chose to not renew the 50 year Petrodollar agreement, which ended on June 9th 2024. This means now that the USD is completely and absolutely free floating with no backing, indirect or direct. And you can see this in which currency countries are holding as a reserve currency. [1] Just before Bretton Woods it was about 85% USD. It then plummeted (after the Bretton Woods default) and then bounced back to reach a peak of 72% in 2001. It's now down to 57% (Wiki table has not been updated with latest numbers) and continuing to steadily decrease.
As soon as a viable alternative currency emerges, the USD will collapse - and this entire economic system alongside it. Trump's ideas aren't so much radical as he is simply saying the quiet parts (probably as a result of intelligence briefings) out loud. This entire thing is why he's threatened 100% tariffs if BRICS countries try to replace the dollar. Of course tariffs from what would be a collapsed economy have far less weight behind them than e.g. the lack of access to oil. So the interesting times we live in are certain to continue for the foreseeable future.
> This means now that the USD is completely and absolutely free floating with no backing, indirect or direct.
All fiat currencies are backed by the strength of their economies. The US denominates its considerable goods and services in USD. That's not nothing.
Literally all advanced economies use fiat currency, but only one benefits from petrodollars. Shouldn't whatever bad thing you think will happen to the US now already have happened to them?
No, fiat currencies are backed by the belief that the government will not abuse their ability to print money. The reason one backs their currency with a metal or whatever is not because that magically does anything in and of itself. All it does is constrain government's ability to excessively print money (and a guarantee of the continuation of such) which is important because printing money is highly rewarding and incentivizing in the short run, but catastrophically damaging in the long run. If a government acts responsibly with their monetary policy the difference between a fiat and backed currency is academic, outside of the guarantee of this behavior continuing indefinitely.
Most countries in the world have been abusing their currencies as a 'hack' for growth. The need for infinite and accelerating growth to fuel the infinite and accelerating debt caused actually seemed briefly sustainable thanks to the computing and internet revolutions. Granted you still have the zillion other negative effects (as per the wtfhappenedin1971) site, but you can at least keep moving forward because the peasants (who are the most negatively affected) will just take it anyhow, so long as they have bread and circuses.
But as soon as you stop the accelerating growth, you get drowned by your own decades of YOLO debt, faith in the currency collapses, and your economy right alongside.
> No, fiat currencies are backed by the belief that the government will not abuse their ability to print money.
That's part of their value, but not their backing. This is one of the reasons something like a gold standard is nonsensical: the amount of gold a country has is wholly unrelated to its economic strength (I think we agree on this).
> Most countries in the world have been abusing their currencies as a 'hack' for growth.
I don't think there's any evidence for this. AIUI growth is entirely explained by technology (e.g. fracking) and natural resource discovery. From time to time something very bad happens and we dump money into the economy, and depending on what the bad thing was that can be a moral hazard or potentially inflationary, but we've only ever seen that on a very small scale (the COVID stimuli were responsible for a very small proportion of the recent inflation spike).
> Granted you still have the zillion other negative effects (as per the wtfhappenedin1971) site, but you can at least keep moving forward because the peasants (who are the most negatively affected) will just take it anyhow, so long as they have bread and circuses.
Income and wealth inequality aren't the result of printing money, and my evidence here is the robber baron era. This is something else goldbugs never want to reckon with: sure things were pretty good in the post-war expansion, but what about before that? Oh right, the Great Depression... hmm. Oh right the robber baron era... hmm. Oh right, the panics of 1819, 1837, 1857, 1901, 1907, and 1910, the Long Depression in 1873, the financial crisis of 1914, the depression of 1920, the recessions in 1949, 1953, 1958, 1960, and 1969. And that's just the US.
Overall the criticism of floating currencies is fully detached from reality. Countries that use them are super successful, there are no successful countries that don't, the dangers that goldbugs warn about have never occurred and there's no evidence they will. On the other hand, the ability to print money is wildly effective when combating crises. So from a policy perspective, you're asking us to 100% endure depression after depression to avoid downsides that have 0% occurred. Even if you're right and you elect people who think you're right, the first depression will kick you and yours out of power forever.
This is the core problem I have with backseat policy entrepreneurs: they rarely have any (usually zero) appreciation of the issue's complexity. As soon as you try and engage in a detailed discussion, you get mired in moralisms and a total lack of empiricism. This debate inevitably goes down to "debt" and "inflation is the most immoral of taxes" (what a lack of imagination btw; I can think of so many virtuous things to tax) and both are full on polemics you can't at all discuss. Debt bad! Harming wage workers bad! Never mind that between 1971 and now things got infinitely better.
It would be a good idea to site your facts rather than relying on instinct, because I suspect you write be surprised.
For instance this [1] is the US monetary supply. If we only dump money on the economy when "bad things are happening" then it must be assumed that really bad things are always happening, and at a rapidly accelerating rate.
And similarly Wiki has a passable section on the history of wealth inequality in the US [2] : "In the late 18th century, “incomes were more equally distributed in colonial America than in any other place that can be measured,” according to Peter Lindert and Jeffrey Williamson. The richest 1 percent of households held only 8.5% of total income in the late 18th century...
In 1860, the top 1 percent collected almost one-third of property incomes, as compared to 13.7% in 1774. There was a great deal of competition for land in the cities and non-frontier areas during this time period, with those who had already acquired land becoming richer than everyone else. The newly burgeoning financial sector also greatly rewarded the already-wealthy, as they were the only ones financially sound enough to invest.[19]"
And once again many of the problems with our current system are already highly visible, completely quantified, and have clear causal backings.
You won't catch me defending ZIRP, but other than that and a weird dip in the 90s, M2 seems to track the value of the US economy pretty well. Why didn't things immediately go to shit after Bretton Woods? Why did it take 40 years and huge, long-lived Fed rate cuts before M2 started outpacing GDP? Could it be that floating currencies maybe aren't disastrous?
> And similarly Wiki has a passable section on the history of wealth inequality in the US [2] : "In the late 18th century
I'm not going back to the economy of literally 1774 to find proof that the gold standard works. "Are banks a good idea" is something you'll have to take up with Hamilton, not me.
> And once again many of the problems with our current system are already highly visible, completely quantified, and have clear causal backings.
Again feel free to post any evidence here, or respond to any of my questions (also with evidence).
> M2 seems to track the value of the US economy pretty well
Ah, now you are seeing! The US prints completely ridiculous amounts of money. The superpower we have/had is to then dump a significant chunk of the resultant inflation onto other countries. So we get to turn a far larger chunk of that printed money into "growth", keep the currency stronger, suffer less inflation, etc than would be true for other countries engaging in identical behavior.
BTW to make sure we're on the same page here. There are two distinct topics at play. One is quality of life for the average person. I think that has stagnated to declined for the plethora of reasons illustrated on the 1971 page. The second is the economic state of the country (as opposed to the people). And that has obviously substantially improved since 1971, particularly with our superpower, but I am arguing that as our ability to export inflation continues to decline we're towards a major inflection point that I suspect will be the end of this economic system.
Since the beginning of capitalism involved owning slaves, I find that very hard to believe.
This romanticization of early stage capitalism is awful. What is late stage capitalism? Because civil rights and women rights have been pretty recent in the grand scheme of things, so in that sense Capitalism was upheld and had most of its lifetime in a scheme that crushed the majority of its people I find the theory of:
In the early days of capitalism there was plenty of authentic scarcity for it to work against. Its problems probably weren't any less, but the juice was plausibly worth the squeeze because the alternatives were terrible.
Now, most of us are working to maintain artificial scarcities, rather than mitigate authentic ones, and there are a lot more of us. So the a randomly chosen effect of our system is more likely to be negative because it's being chosen in a context that's very far from that long lost age when capitalism seemed necessary.
I think that's what makes it late-stage, when it's found to have more side-effect than desired effect. Like a yeast which started turning sugar into alcohol at a prodigious rate but then later the alcohol concentration is toxic to it and more effort is spent trying to filter it out than anything to do with its original purpose.
Capitalism is still necessary, we just forgot what it took to save capitalism from itself during the great depression and have opened ourselves up to turning into modern Russia.
Not a die hard defender of capitalism by any means but this is a gross over simplification. If you look at all of the alternatives during the early stages of capitalism the vast majority had oppression as a built in feature. It didn't bring about utopia but it did offer the best advantages over the competition, up until the competition all went under.
If everyone has destruction of the competition as their primary goal, everyone suffers. The voting system itself incentivizes that, and now competition is going to be driven underground and emerge destructively just as it did in the USSR.
Extremes of left and right-wing politics both require excessive force to implement.
We need a voting system that will overcome the nash equilibrum of mutually assured destruction by assigning weights to the outcomes of collective responsibility for our interactions, not just "be selfish or not" on an individual level or "stay in the frying pan or put some people in the fire" politically.
I image they are talking about something like ranked choice voting. Australia currently uses a system like it instead of first past the post. From what I've heard it doesn't really stop a 2 party system from forming, but it does keep it stable because political parties can see which way the wind is blowing. If 40% of your vote came from people that had less extreme party as their first round choice, and 10% of your votes came from people that had more extreme party as their first round choice then you get a good idea of what the majority of your voters actually care about.
> assigning weights to the outcomes of collective responsibility for our interactions
Voting is an input, not an outcome. Anyhow re: ranked choice voting, it's better than FPTP like we use in the US, though if I had to pick one it would be https://www.starvoting.org
> Since the beginning of capitalism involved owning slaves, I find that very hard to believe.
If you look into this a little bit more, I think you’ll find that the institution of slavery doesn’t strictly require any particular system of economics, government, or religion.
Anyway, you are misunderstanding what I meant by early / late capitalism.. it’s not just about specific calendar epochs like 1950-present. What I’m referring to is that any new market will have early/middle/late stages that are pretty distinct from each other. A new market might be created by new policy (say a change in import/export restrictions) or by new technology (like the internet or AI) or by new frontiers (like the East Indies before, and outer space soon). Late stage here just means the real ideation and competition is basically finished and now it’s time for consolidation, M+A, integrating vertically, optimizing exploitation/extraction, enshittification, etc.
They're not the majority. The majority is simply overwhelmed by the blind focus of the dedicated few willing to burn anything they don't see as having immediate value. That means trust goes out the window.
Duverger's law is to blame, the idea that only two parties were viable because any third option would just split the vote and make the former majority lose. It became just as effective, if not more effective, to undermine the opposition and destroy competition itself.
It's a coordination problem. We've begun to solve it in training of AI models, having both a capability coach (model of purely what are valid patterns) and a moral coach (model of how those valid patterns affect the feelings of human observers). It creates compromise between capability and human goals, but creates at least a basic level of alignment, with more layers of filtering and iterative generation as options to catch mistakes at time of inference instead of training.
In politics, the "left" is the raw capability, but it focuses so much on being accurate that it can lose track of the goals that really matter, and the strategy necessary to reach those goals. The "right" is dedicated to a particular goal, sometimes so much so that it denies "obvious" reality in order to focus on blind faith to its cause.
The two "sides" NEED each other. That wisdom has been lost. Moloch, the idea of a demon representing the outcome of selfish incentives benefiting the individual but hurting everyone as a result, reigns supreme.
The only way out that I can see is a voting system with partial weights and moderately more expressiveness. Give too much expressiveness and you create a purity test ruled by a single party and scoring points on how "American" or $MyState they are. Give too little and you get what we have now, the frying pan and the fire trying to herd people into their camp until everyone lands in the fire anyway.
If instead of voting for {+1, 0, 0, ...} without repeats, we used a system with {+1, +0.5, -0.5} without repeats (no double scoring of candidates, no duplicating scores) each district should end up with a dynamic stability of maybe 3-5 parties. The negativity would be in the hands of the voters. The candidates would be incentivized to use constructive campaigns, because negativity would be diluted, and if they went negative they'd attract even more negativity to themselves.
Even more fundamentally if you apply those weights to the outcomes of a Nash Equilibrium, such as nuclear war, armed standoff, or even destructive war between economic powers, the win-lose outcomes are on parity or lower than the win-win outcome if such a win-win possibility exists.
I really think this problem represents the Great Filter. If we can't learn from it, we're doomed, whether to ourselves or to our AI systems learning and inheriting the selfish form of the logic from us. Government needs to be the result of win-win interactions or it will be unstable.
The founding fathers, the framers of the US Constitution, recognized the need to balance greed against greed, self-interest tempered by respect of that in others. The government was split into 3 branches, and Washington warned us of the dangers of partisanship. We didn't have the math to solve it, then, but now we do: Partial votes at the state level creating healthy, constructive, honest competition. The principle that actually Made America Great, enabled by opportunity itself.
I don't think it easily could have gone another way. Progress follows incentives, and money is a strong incentive. Only very fundamental changes to copyright and "publishing accountability" legislation could have put us on another path.
money and the realization that this "new" web was half computing half society .. and we now get the same need for rules, safety, morality as in the real world
