7 ms·

Hedge-fund billionaire Ray Dalio says capitalism needs urgent reform

71 points by starbugs 8y ago

mrleiter 8y ago
He is a very keen observer. Yet he argues capitalism needs reform because it could lead to real conflict between people in a country and not because it is unfair. He wants to be safe, so do I, but I'm not a hedge fund billionaire. I want societal change because every human has a worth and seeing inequality among equals makes me sad.
- jessaustin 8y ago
  Piketty has argued persuasively that conflict, chaos, and tumult are historically among the primary drivers of equality. It's no surprise the billionaires don't want any of that! Someone more conspiracy-minded than myself might suggest that this is why the wealthy support all these high-expense low-payoff wars in distant lands, to use up all the fighters who would more properly be home rearranging this society toward more equal circumstances.
  - aristophenes 8y ago
    That's true, if we are all dirt poor and struggling just to survive we would be more equal. If that's what you want. Is equality the ultimate good?
    - thundergolfer 8y ago
      You say "that's true", and then the rest of your comment has nothing to do with what they said. The idea that people are advocating for any kind of equalisation that would leave us all poor is a lazy strawman.
      - aristophenes 8y ago
        > Piketty has argued persuasively that conflict, chaos, and tumult are historically among the primary drivers of equality. > fighters who would more properly be home rearranging this society toward more equal circumstances. My understanding was that the poster was implying that conflict, chaos, and tumult would promote equality. I agreed that I thought it would, but implied that it wasn't worth it. I'd take an unequal society where more people are prosperous, over an equal one where everyone is equally miserable. It seems to me there is a growing percentage of the public that want to throw it all away and start over, but I'd point out that for most of human history, most everywhere in the world, most people where either struggling to survive or living as slaves of someone or another. Neither is the case now, we're doing something right and I think a lot of people are just spoiled with how good it's been.
        jessaustin 8y ago
        A lot of KPIs are still pointing up, but over the last several decades more and more are pointing down. (Since you mention slavery, we have to admit that there are more slaves in e.g. Libya than there were a decade ago.) When does the frog jump out of the pot? The answer might be subjective, but it probably relates to wealth.
- zarkov99 8y ago
  It is much easier to persuade people from varying ideological bents to do something about this problem if its discussed in terms of objective harm, rather than subjective assessments of fairness.
- blihp 8y ago
  He knows his target audience. One generally becomes a billionaire by focusing on self-interest, not altruism.
- dragonwriter 8y ago
  > Yet he argues capitalism needs reform because it could lead to real conflict between people in a country and not because it is unfair. Which is likely a more effective argument to the ruling elite than fairness: To quote Heinlein’s Lazarus Long: Never appeal to a man’s “better nature.” He may not have one. Invoking self-interest gives you more leverage. > He wants to be safe, so do I, but I'm not a hedge fund billionaire An economic revolution may target the wealthy, but revolutions are rarely conducted without substantial collateral damage (and harm to the revolutionaries themselves, which is why it takes more than a little transitory pain to provoke them.)
SamReidHughes 8y ago
I think the most practical problem of wealth disparity isn't between the rich and the poor, but between the growing upper middle class and lower middle class. First, that's more visible to the lower middle class than a few distant billionaires. Second, it's a much larger volume of wealth and influence overall. Much of what squeezes the poor -- housing, land, education, healthcare -- are the result of common voters, not billionaire interests. The ACA, for example, is a great law for entrepreneurial software developers, not so for the lower income small businesses, because of the increased costs. Nothing holding back the working class is caused by plutocrats. Edit: Lyft is another example of this. Abstractly, wealthier riders are colluding (via Lyft) to drive down margins of unskilled workers.
- rileymat2 8y ago
  >The ACA, for example, is a great law for entrepreneurial software developers, not so for the lower income small businesses, because of the increased costs. I am curious if this is a factual critique? Some quick research. https://www.healthcare.gov/small-businesses/learn-more/how-aca-affects-businesses/ https://www.healthcare.gov/small-businesses/learn-more/how-a... https://www.irs.gov/affordable-care-act/individuals-and-families/find-out-how-aca-affects-employers-with-fewer-than-50-employees https://www.irs.gov/affordable-care-act/individuals-and-fami... https://www.commonwealthfund.org/publications/issue-briefs/2018/oct/affordable-care-act-impact-small-business https://www.commonwealthfund.org/publications/issue-briefs/2... But this is not may area of expertise, so I cannot judge.
  - SamReidHughes 8y ago
    I am specifically talking about business owners' ability to get health coverage for themselves and their families, not requirements around getting coverage for their employees. This class of people includes lawyers, consultants, Uber/Lyft/Taxi drivers, plumbers, roofers, and landscapers. People like me benefit from the ACA. People that make less money now have to spend more on insurance for their family.
    - deleted 8y ago
      [deleted]
hbcondo714 8y ago
Previous discussion from a couple days ago: https://news.ycombinator.com/item?id=19582562 https://news.ycombinator.com/item?id=19582562
paulpauper 8y ago
Wealth inequality is inevitable in any advanced, meritocratic society. I think a better approach is trying to create opportunity for talented people of all income levels, to create companies, arts, and innovation, which boosts GDP and livings standards and benefits everyone. Imagine federally-funded versions of the MacArthur Fellows Program, or the Theil Fellowship, or YCombinator , that would have many more applicants than such programs already have. There are probably a lot of gifted talented young people of low and middle-class that are being underutilized, underserved with current policy.
- AlexTWithBeard 8y ago
  Why do we concentrate on wealth inequality so much? What's wrong about some people being ultra rich and just well off? Would it be better if everyone we're equally poor?
  - Retric 8y ago
    Many resources like land are finite. For someone to have more land others must have less. Unfortunately, that extends to things like access to politions and the ability to shape laws not just arbitrary numbers in a bank account. Extreme wealth inequality is less about a few people having more than it is about many people having less. Billionaires exist in most countries, it’s the amount of poverty that’s the issue in the US not the wealthy.
    - nilskidoo 8y ago
      And we need to address that the recent issue of the college admissions scandal is by no means limited to academia. Wealth abuses each and every industry in similar or more damaging ways. Even the Daily Show tried to play it off as mere helicopter parenting.
    - seibelj 8y ago
      Good thing we can build tall buildings, so each owner in the building can own a piece of the same land.
    - 8y ago
roenxi 8y ago
He makes a number of excellent points; but I have to laugh wryly at his treatment of my personal pet peeve, interest rates. Boil his 'diagnosis' section down into 3 points - the economic equilibrium is moving away from employing American workers to do work (1 & 2), the central banks are printing money (3) and government is ineffective (4). Call me a cynic, but (4) on this list is probably a structural problem in that the people who vote governments in are a diverse crowd and lining them up is a bit more challenging than herding cats. Maybe something can be done. (1 & 2) are issues of genuine concern. I've got nothing to add. (3) is the laughable one. The problem is that there is money printing afoot and the money is going to wealthy people (see graphs). The billionaire solution is 'shifting money and credit into the hands of those who have a higher propensity to spend'. What ever happened to the philosophy that we should shift money and credit to the people who have a propensity to build stuff that will be useful in the future? The thing capitalism is actually good at? We should not want to funnel resources to the rich. We should not want resources to go to high spenders. We should not even want to funnel them to the poor. We want to funnel resources to people who create more resources. That way we will have more resources and can solve our problems using them. Good old-fashioned flexible human thinking is needed to talk about how the system needs to change but in the same text say that quantitative easing is necessary when its purpose was, essentially, to prevent the system from changing.
- afarrell 8y ago
  How do the builders know what is important to build unless those who are suffering can vote for solutions to their ills? Thats my argument for funneling resources to the poor: so that entrepreneurs can earn revenue fixing poor people’s problems. Or (and this is a reason to use markets) so entrepreneurs can earn revenue fixing the problems that entrepreneurs encounter when trying to fix poor people’s problems.
  - AdrianB1 8y ago
    Voting for solutions does not make right solutions, just popular. For example in my country the majority voted for significant public employees salary and state pensions increase - great idea, you can vote yourself rich, it does not mean it can be done and it does not mean it is a good idea.
davidf18 8y ago
One reason why capitalism isn't working is because of market failures on otherwise efficient markets, chief among them are zoning density restrictions that create artificial land scarcity resulting in the high cost of housing and offices in cities such as my own (NYC), but also SF, Boston, DC, Seattle, LA, and London. The zoning density restriction are a form of "rent-seeking" -- the use of politics to take more than one's fare share of wealth creation. Trump's net worth might be twice as high as it would be in an efficient real estate market -- ironically, it is the Democrats (through running city councils that pass zoning laws) that have made him as wealthy as he is. In addition, the proportion of funding to state universities have declined with the result that students are getting further into debt. Many of the "fixes" proposed by others are trying to add a "fix" to a broken economy instead of dealing with fundamental structural problems in the economy caused by market inefficiencies or market failures. It makes a lot more sense to deal with the causes of the market failures favoring special interest groups first before adding new programs. For example, Japan solved the rent-seeking issue by instituting federal laws that overrode the local zoning density laws. The result: in 2014, California built about 90,000 housing units, NYC 20,000, but in Tokyo 140,000. I believe the people who are programmers and engineers that read HN believe in the approach of fixing the underlying structural problems (to the software or hardware but to economic market) instead of adding kluges of attempting to fix a broken system by not addressing the fundamental issues.
Anon84 8y ago
Posted a link to the actual post a few hours ago... https://news.ycombinator.com/item?id=19596590 https://news.ycombinator.com/item?id=19596590
m0zg 8y ago
I'm fully in favor of "dividing" Ray Dalio's "pie" in particular. Dude is worth $14.8 billion. If we're at the stage of divvying things up, I want my "fair share". Unfortunately, as it often happens, that's likely not what Ray has in mind. He'd rather pay for his virtue signaling with other people's money.
goldcd 8y ago
Something is clearly going wrong - and unless we have a correction, then it's going to take us all down with it. My suggestion for discussion: "Stock Options for all" - or something that provides a similar motivation. If you work for a company, you get a salary - but each month you progressively get a bit more skin in the game. Currently we have traders who'll switch allegiance in a moment, Cxx's who are motivated over a quarter/defined period and workers who just take their pay-check. I can't see how it wouldn't be beneficial if everybody involved had an overriding goal of ensuring the company they were involved with had a healthy long-term goal to increase value.
- goldcd 8y ago
  or to look at it from the entry-level side. There are currently no shortage of minimumish wage jobs out there (choose your payment-point). The jobs and therefore you as an employer are interchangeable. What do you offer that makes them want to care for your company more than just the salary you offer? How do you attract better people to your great company, when you can't afford a competitive salary right now?
- 0815test 8y ago
  Unfortunately, most workers won't actually want anything like this - especially the lowest-income/wealth workers. "Skin in the game" at the firm you're already working for (thus involving quite a bit of relationship-specific capital, which would lose its value real quickly if the firm went under) is just putting all your eggs in one basket.
  - njepa 8y ago
    What you would probably do is create some sort of fund, and spread the risk that way. In general it is one of the more realistic ideas, where you could build on existing systems. The problem is that many countries have gone so far the other way that it can't be implemented. A search for "meidner" on Jacobin will give a bunch of reading: https://www.jacobinmag.com/search?query=meidner https://www.jacobinmag.com/search?query=meidner
    - 8y ago
plainOldText 8y ago
> “So there need to be powerful forces from the top of the country that proclaim the income/wealth/opportunity gap to be a national emergency and take on the responsibility for re-engineering the system so that it works better.” And what if the system turns out to work worse? Who shall bear the consequences of the re-engineering? Being a successful hedge fund manager, doesn’t magically make you an expert in complex systems, such as the economy. The amount of people wanting to re-engineer society these days is staggering. The desire to make the world a better place for more people is commendable, but people need to understand the limitations of controlling complexity. IMHO, we need to teach more people about complex systems and the limitations of top down engineering approaches to such systems, as they exhibit emerging properties unaccounted for in one’s modeling. What we need is to give power back to the individual, decentralize the control over the economy and lower the barriers to entry, so that everyone can have an equal chance of trying their luck. We need to evolve a better system, bottom up. See localism. [1] [2] [1] https://en.m.wikipedia.org/wiki/Localism_(politics) https://en.m.wikipedia.org/wiki/Localism_(politics) [2] https://www.academia.edu/38433249/Multiscale_Localism_Political_Clarity_under_Complexity https://www.academia.edu/38433249/Multiscale_Localism_Politi...
- outlace 8y ago
  Yeah only a billionaire like Dalio can afford to recommend massive top-down re-engineering of the economy. If it doesn’t work he’ll just have a few less billion and the rest of us may not have jobs.
  - njepa 8y ago
    Maybe I am a bit cynical. But from my perspective this, and similar calls for change, doesn't come from suddenly longing for America at its best. But because they increasingly realize that China is coming for their lunch.
    - akhilcacharya 8y ago
      That’s very valid reasoning to support change!
tim333 8y ago
If you look at his actual article rather than the marketwatch story https://www.linkedin.com/pulse/why-how-capitalism-needs-reformed-parts-1-2-ray-dalio/?published=t https://www.linkedin.com/pulse/why-how-capitalism-needs-refo... then what he is saying is more capitalism in the US is mucked up by comparison with how it works in other countries.
RickJWagner 8y ago
Dalio is a smart guy, but regarded by some as a bit of a flake. His success in finances is undeniable. His 'All-Weather Portfolio' is completely at odds with what most advisors consider sound fiscal practice. On this one, I think he should be listened to. At least it should start a national discussion.

71 points by starbugs 8y ago

He is a very keen observer. Yet he argues capitalism needs reform because it could lead to real conflict between people in a country and not because it is unfair. He wants to be safe, so do I, but I'm not a hedge fund billionaire. I want societal change because every human has a worth and seeing inequality among equals makes me sad.

jessaustin 8y ago
Piketty has argued persuasively that conflict, chaos, and tumult are historically among the primary drivers of equality. It's no surprise the billionaires don't want any of that! Someone more conspiracy-minded than myself might suggest that this is why the wealthy support all these high-expense low-payoff wars in distant lands, to use up all the fighters who would more properly be home rearranging this society toward more equal circumstances.
- aristophenes 8y ago
  That's true, if we are all dirt poor and struggling just to survive we would be more equal. If that's what you want. Is equality the ultimate good?
  - thundergolfer 8y ago
    You say "that's true", and then the rest of your comment has nothing to do with what they said. The idea that people are advocating for any kind of equalisation that would leave us all poor is a lazy strawman.
    - aristophenes 8y ago
      > Piketty has argued persuasively that conflict, chaos, and tumult are historically among the primary drivers of equality. > fighters who would more properly be home rearranging this society toward more equal circumstances. My understanding was that the poster was implying that conflict, chaos, and tumult would promote equality. I agreed that I thought it would, but implied that it wasn't worth it. I'd take an unequal society where more people are prosperous, over an equal one where everyone is equally miserable. It seems to me there is a growing percentage of the public that want to throw it all away and start over, but I'd point out that for most of human history, most everywhere in the world, most people where either struggling to survive or living as slaves of someone or another. Neither is the case now, we're doing something right and I think a lot of people are just spoiled with how good it's been.
      - jessaustin 8y ago
        A lot of KPIs are still pointing up, but over the last several decades more and more are pointing down. (Since you mention slavery, we have to admit that there are more slaves in e.g. Libya than there were a decade ago.) When does the frog jump out of the pot? The answer might be subjective, but it probably relates to wealth.
zarkov99 8y ago
It is much easier to persuade people from varying ideological bents to do something about this problem if its discussed in terms of objective harm, rather than subjective assessments of fairness.
blihp 8y ago
He knows his target audience. One generally becomes a billionaire by focusing on self-interest, not altruism.
dragonwriter 8y ago
> Yet he argues capitalism needs reform because it could lead to real conflict between people in a country and not because it is unfair. Which is likely a more effective argument to the ruling elite than fairness: To quote Heinlein’s Lazarus Long: Never appeal to a man’s “better nature.” He may not have one. Invoking self-interest gives you more leverage. > He wants to be safe, so do I, but I'm not a hedge fund billionaire An economic revolution may target the wealthy, but revolutions are rarely conducted without substantial collateral damage (and harm to the revolutionaries themselves, which is why it takes more than a little transitory pain to provoke them.)

SamReidHughes 8y ago

I think the most practical problem of wealth disparity isn't between the rich and the poor, but between the growing upper middle class and lower middle class. First, that's more visible to the lower middle class than a few distant billionaires. Second, it's a much larger volume of wealth and influence overall. Much of what squeezes the poor -- housing, land, education, healthcare -- are the result of common voters, not billionaire interests. The ACA, for example, is a great law for entrepreneurial software developers, not so for the lower income small businesses, because of the increased costs. Nothing holding back the working class is caused by plutocrats. Edit: Lyft is another example of this. Abstractly, wealthier riders are colluding (via Lyft) to drive down margins of unskilled workers.

rileymat2 8y ago
>The ACA, for example, is a great law for entrepreneurial software developers, not so for the lower income small businesses, because of the increased costs. I am curious if this is a factual critique? Some quick research. https://www.healthcare.gov/small-businesses/learn-more/how-aca-affects-businesses/ https://www.healthcare.gov/small-businesses/learn-more/how-a... https://www.irs.gov/affordable-care-act/individuals-and-families/find-out-how-aca-affects-employers-with-fewer-than-50-employees https://www.irs.gov/affordable-care-act/individuals-and-fami... https://www.commonwealthfund.org/publications/issue-briefs/2018/oct/affordable-care-act-impact-small-business https://www.commonwealthfund.org/publications/issue-briefs/2... But this is not may area of expertise, so I cannot judge.
- SamReidHughes 8y ago
  I am specifically talking about business owners' ability to get health coverage for themselves and their families, not requirements around getting coverage for their employees. This class of people includes lawyers, consultants, Uber/Lyft/Taxi drivers, plumbers, roofers, and landscapers. People like me benefit from the ACA. People that make less money now have to spend more on insurance for their family.
  - deleted 8y ago
    [deleted]

hbcondo714 8y ago

Previous discussion from a couple days ago: https://news.ycombinator.com/item?id=19582562 https://news.ycombinator.com/item?id=19582562

paulpauper 8y ago

Wealth inequality is inevitable in any advanced, meritocratic society. I think a better approach is trying to create opportunity for talented people of all income levels, to create companies, arts, and innovation, which boosts GDP and livings standards and benefits everyone. Imagine federally-funded versions of the MacArthur Fellows Program, or the Theil Fellowship, or YCombinator , that would have many more applicants than such programs already have. There are probably a lot of gifted talented young people of low and middle-class that are being underutilized, underserved with current policy.

AlexTWithBeard 8y ago
Why do we concentrate on wealth inequality so much? What's wrong about some people being ultra rich and just well off? Would it be better if everyone we're equally poor?
- Retric 8y ago
  Many resources like land are finite. For someone to have more land others must have less. Unfortunately, that extends to things like access to politions and the ability to shape laws not just arbitrary numbers in a bank account. Extreme wealth inequality is less about a few people having more than it is about many people having less. Billionaires exist in most countries, it’s the amount of poverty that’s the issue in the US not the wealthy.
  - nilskidoo 8y ago
    And we need to address that the recent issue of the college admissions scandal is by no means limited to academia. Wealth abuses each and every industry in similar or more damaging ways. Even the Daily Show tried to play it off as mere helicopter parenting.
  - seibelj 8y ago
    Good thing we can build tall buildings, so each owner in the building can own a piece of the same land.
  - 8y ago

roenxi 8y ago

He makes a number of excellent points; but I have to laugh wryly at his treatment of my personal pet peeve, interest rates. Boil his 'diagnosis' section down into 3 points - the economic equilibrium is moving away from employing American workers to do work (1 & 2), the central banks are printing money (3) and government is ineffective (4). Call me a cynic, but (4) on this list is probably a structural problem in that the people who vote governments in are a diverse crowd and lining them up is a bit more challenging than herding cats. Maybe something can be done. (1 & 2) are issues of genuine concern. I've got nothing to add. (3) is the laughable one. The problem is that there is money printing afoot and the money is going to wealthy people (see graphs). The billionaire solution is 'shifting money and credit into the hands of those who have a higher propensity to spend'. What ever happened to the philosophy that we should shift money and credit to the people who have a propensity to build stuff that will be useful in the future? The thing capitalism is actually good at? We should not want to funnel resources to the rich. We should not want resources to go to high spenders. We should not even want to funnel them to the poor. We want to funnel resources to people who create more resources. That way we will have more resources and can solve our problems using them. Good old-fashioned flexible human thinking is needed to talk about how the system needs to change but in the same text say that quantitative easing is necessary when its purpose was, essentially, to prevent the system from changing.

afarrell 8y ago
How do the builders know what is important to build unless those who are suffering can vote for solutions to their ills? Thats my argument for funneling resources to the poor: so that entrepreneurs can earn revenue fixing poor people’s problems. Or (and this is a reason to use markets) so entrepreneurs can earn revenue fixing the problems that entrepreneurs encounter when trying to fix poor people’s problems.
- AdrianB1 8y ago
  Voting for solutions does not make right solutions, just popular. For example in my country the majority voted for significant public employees salary and state pensions increase - great idea, you can vote yourself rich, it does not mean it can be done and it does not mean it is a good idea.

davidf18 8y ago

One reason why capitalism isn't working is because of market failures on otherwise efficient markets, chief among them are zoning density restrictions that create artificial land scarcity resulting in the high cost of housing and offices in cities such as my own (NYC), but also SF, Boston, DC, Seattle, LA, and London. The zoning density restriction are a form of "rent-seeking" -- the use of politics to take more than one's fare share of wealth creation. Trump's net worth might be twice as high as it would be in an efficient real estate market -- ironically, it is the Democrats (through running city councils that pass zoning laws) that have made him as wealthy as he is. In addition, the proportion of funding to state universities have declined with the result that students are getting further into debt. Many of the "fixes" proposed by others are trying to add a "fix" to a broken economy instead of dealing with fundamental structural problems in the economy caused by market inefficiencies or market failures. It makes a lot more sense to deal with the causes of the market failures favoring special interest groups first before adding new programs. For example, Japan solved the rent-seeking issue by instituting federal laws that overrode the local zoning density laws. The result: in 2014, California built about 90,000 housing units, NYC 20,000, but in Tokyo 140,000. I believe the people who are programmers and engineers that read HN believe in the approach of fixing the underlying structural problems (to the software or hardware but to economic market) instead of adding kluges of attempting to fix a broken system by not addressing the fundamental issues.

Anon84 8y ago

Posted a link to the actual post a few hours ago... https://news.ycombinator.com/item?id=19596590 https://news.ycombinator.com/item?id=19596590

m0zg 8y ago

I'm fully in favor of "dividing" Ray Dalio's "pie" in particular. Dude is worth $14.8 billion. If we're at the stage of divvying things up, I want my "fair share". Unfortunately, as it often happens, that's likely not what Ray has in mind. He'd rather pay for his virtue signaling with other people's money.

goldcd 8y ago

Something is clearly going wrong - and unless we have a correction, then it's going to take us all down with it. My suggestion for discussion: "Stock Options for all" - or something that provides a similar motivation. If you work for a company, you get a salary - but each month you progressively get a bit more skin in the game. Currently we have traders who'll switch allegiance in a moment, Cxx's who are motivated over a quarter/defined period and workers who just take their pay-check. I can't see how it wouldn't be beneficial if everybody involved had an overriding goal of ensuring the company they were involved with had a healthy long-term goal to increase value.

goldcd 8y ago
or to look at it from the entry-level side. There are currently no shortage of minimumish wage jobs out there (choose your payment-point). The jobs and therefore you as an employer are interchangeable. What do you offer that makes them want to care for your company more than just the salary you offer? How do you attract better people to your great company, when you can't afford a competitive salary right now?
0815test 8y ago
Unfortunately, most workers won't actually want anything like this - especially the lowest-income/wealth workers. "Skin in the game" at the firm you're already working for (thus involving quite a bit of relationship-specific capital, which would lose its value real quickly if the firm went under) is just putting all your eggs in one basket.
- njepa 8y ago
  What you would probably do is create some sort of fund, and spread the risk that way. In general it is one of the more realistic ideas, where you could build on existing systems. The problem is that many countries have gone so far the other way that it can't be implemented. A search for "meidner" on Jacobin will give a bunch of reading: https://www.jacobinmag.com/search?query=meidner https://www.jacobinmag.com/search?query=meidner
  - 8y ago

plainOldText 8y ago

> “So there need to be powerful forces from the top of the country that proclaim the income/wealth/opportunity gap to be a national emergency and take on the responsibility for re-engineering the system so that it works better.” And what if the system turns out to work worse? Who shall bear the consequences of the re-engineering? Being a successful hedge fund manager, doesn’t magically make you an expert in complex systems, such as the economy. The amount of people wanting to re-engineer society these days is staggering. The desire to make the world a better place for more people is commendable, but people need to understand the limitations of controlling complexity. IMHO, we need to teach more people about complex systems and the limitations of top down engineering approaches to such systems, as they exhibit emerging properties unaccounted for in one’s modeling. What we need is to give power back to the individual, decentralize the control over the economy and lower the barriers to entry, so that everyone can have an equal chance of trying their luck. We need to evolve a better system, bottom up. See localism. [1] [2] [1] https://en.m.wikipedia.org/wiki/Localism_(politics) https://en.m.wikipedia.org/wiki/Localism_(politics) [2] https://www.academia.edu/38433249/Multiscale_Localism_Political_Clarity_under_Complexity https://www.academia.edu/38433249/Multiscale_Localism_Politi...

outlace 8y ago
Yeah only a billionaire like Dalio can afford to recommend massive top-down re-engineering of the economy. If it doesn’t work he’ll just have a few less billion and the rest of us may not have jobs.
- njepa 8y ago
  Maybe I am a bit cynical. But from my perspective this, and similar calls for change, doesn't come from suddenly longing for America at its best. But because they increasingly realize that China is coming for their lunch.
  - akhilcacharya 8y ago
    That’s very valid reasoning to support change!

tim333 8y ago

If you look at his actual article rather than the marketwatch story https://www.linkedin.com/pulse/why-how-capitalism-needs-reformed-parts-1-2-ray-dalio/?published=t https://www.linkedin.com/pulse/why-how-capitalism-needs-refo... then what he is saying is more capitalism in the US is mucked up by comparison with how it works in other countries.

RickJWagner 8y ago

Dalio is a smart guy, but regarded by some as a bit of a flake. His success in finances is undeniable. His 'All-Weather Portfolio' is completely at odds with what most advisors consider sound fiscal practice. On this one, I think he should be listened to. At least it should start a national discussion.