This Could Be Our Future

This book is about a simple idea. That a world of scarcity can become a world of abundance if we accept a broader definition of value.

Written by one of the founders of Kickstarter, Yancey Strickler. A smart, well-written, strong argument for less financial maximization. Pairs well with Winner Takes All.

Financial maximization has trapped us with three assumptions: (1) that the point of life is to maximize financial wealth, (2) that we’re individuals trapped in an adversarial world, and (3) that this situation is inevitable and eternal.

It seems to me much of our current problems come from treating finance and technology as values when they are really just tools to solve problems. We’ve lost sight of the problems and the why. I also wonder if effectively treating companies as people has to lead to a lot of this. When Smith was alive, the butcher was actually a person. Today the butcher is Smithfield, legally treated as an individual, in many cases agnostic to its end customer, and controlled by its shareholders with the purpose of maximizing financial value. It’s a massive principal-agent problem that encompasses nearly our entire financial structure.

But note that Smith didn’t say that the butcher must maximize hog slaughter rates, lower standards to an acceptable minimum, and underpay and overwork laborers to maximize those profits, and then redirect that money to executives and investors instead.

If you just read the headlines, would you ever guess this stat to be true?

American entrepreneurship rates today are, per capita, half of what they were in the 1970s. You read that right: half. This is analogous to the drop in smoking rates over the same time span.

Interesting discussions on student loan debt, which is a ticking time bomb, technology and government, unintended consequences of financial maximization, and what GPD really accounts for.

Unlike debt-fueled start-ups, real estate developers, and other businesses, students are legally barred from filing bankruptcy to escape their debts. In fact, some in Congress have even proposed instituting mandatory garnishment of future wages to collect what students borrowed.

As an example, Mazzucato demonstrates that the technology behind every part of the iPhone—from the touch screen to 3G wireless to GPS to the internet itself—was directly funded by the US government. Apple brilliantly commercialized the technology, but the work behind the iPhone was created by academic researchers funded by federal investments.

In recent decades, the number of bank branches in Manhattan has grown considerably. In 2014 there were 1,763 banks in New York City. That’s 461 more than a decade before. It’s as if the ATM were never invented.

According to GDP, then, the ideal citizen would drive an SUV, have cancer (chemotherapy can be very GDP-positive), be getting a divorce, and eat out every night. According to our predominant measurement of value, this would be ideal. If we all lived this way, GDP would skyrocket.

And lastly, while it’s easy to be pessimistic, change is going to come

People alive today will be a minority of the total people alive thirty years from now.