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This comment is top rated yet misconstrues – in order to advance the author's values – both the argument and the context. Topically, Wenger is a partner at USV

This comment is top rated yet misconstrues – in order to advance the author's values – both the argument and the context. Topically, Wenger is a partner at USV (Manhattan) and _The World After Capital_ was published as a Gitbook in order to be open source. It is not intended to describe nor comment, politically, on the day to day of capital flows. Attacking it as such is a straw man argument at best and intellectually lazy at worst.

Animats 5y ago
(If I have an economic position, it's perhaps close to Piketty. Although he draws on pre-industrial age statistics too much.) My main criticism of this revolves around the question "what are we out of that limits society?". The author argues that capital is not scarce, which seems to be true for the US. He argues that attention is scarce, which is reasonable. He then takes the big jump. He argues that attention is the primary limiting factor on, in some sense, "progress". That's where his argument goes bad. That limiting factor applies to a small part of the economy, but it's the part that gets much VC attention. So what are we out of? This is a crucial question. I'm not going to try to propose an answer. But it's the right question to ask. When something other than capital limits output, capital markets don't send the right signals to direct effort in useful directions. This leads to somewhat strange investments chewing up large amounts of capital. HN readers don't need examples of this.
- throwawaylinux 5y ago
  I know very little about economics particularly the academic / theoretical side of it. You and Wenger here both seem to agree there is an abundance of capital (money?) and that's not the "limiting factor" at least in the US. He writes > When we were foragers, food was scarce. During the agrarian age, it was land. Following the industrial revolution, capital became scarce. I don't really see how they are equivalent. Or actually I do they how they are equivalent but not in the way he writes. For tribal chiefs, food probably wasn't scarce. For kings and lords, land was not scarce. For industrialists, capital was not scarce. Wealthy people haven't just started doing strange things with capital as though they hadn't in the past with capital or land or food. Food wastage was a point of pride in elite society of the past, locking away vast amounts of productive land for private game parks, and investing wealth in all sorts of foolish ventures has been pretty common throughout history. Yet all of those things were (and many still are) scarce for many people including in the US. So why do you say it's not, and what do you mean by "limits" of society exactly? If a person can't buy a car or an education or a computer or tools or time to practice a new skill, then they can't work (or have less opportunity to) or they can't increase their productivity as much. Or they can't afford to have or put as much time and money into their children, which further limits society in the longer term. I'm no collectivist, anti-capitalist, or social justice activist, I think inequality will always be here and it's our curse and our blessing. But surely we can't say capital is not scarce or doesn't matter so long as a significant number of people are limited by their own lack of it. Limited not just in entertainment and frivolous things but constructive wealth creating activities. Have I completely misunderstood the whole thing?
  - xcambar 5y ago
    > I think inequality will always be here and it's our curse and our blessing. ...say people who are on the blessing side of inequality. Note: I am on the blessing side as well. I have no experience whatsoever about what it means to suffer from inequality.
    - throwawaylinux 5y ago
      > ...say people who are on the blessing side of inequality. This isn't an argument I'm afraid. > Note: I am on the blessing side as well. I have no experience whatsoever about what it means to suffer from inequality. Yes you do. Not everybody who is less well off than you live a life of misery and unhappiness and desperation. There would even be many very poor people who have happier and more fulfilling lives than you do I would wager.
  - lmm 5y ago
    > For tribal chiefs, food probably wasn't scarce. For kings and lords, land was not scarce. For industrialists, capital was not scarce. On the contrary, kings and lords were acutely aware of how much land they had and devoted much of their energy to amassing more. Likewise for tribal chiefs and food, and presumably likewise for industrial. They had more of it than others, sure, but it was scarce for them: it was the limiting factor on what they were doing. > If a person can't buy a car or an education or a computer or tools or time to practice a new skill, then they can't work (or have less opportunity to) or they can't increase their productivity as much. Or they can't afford to have or put as much time and money into their children, which further limits society in the longer term. Right, but at that individual level too, capital isn't really the issue these days. You can get a loan for anything, anyone can get a credit card. If someone wants to improve themselves, it's rarely capital that's the limiting factor - it's more likely to either be time, or something a bit more complicated.
    - throwawaylinux 5y ago
      > On the contrary, kings and lords were acutely aware of how much land they had and devoted much of their energy to amassing more. Likewise for tribal chiefs and food, and presumably likewise for industrial. They had more of it than others, sure, but it was scarce for them: it was the limiting factor on what they were doing. So it's exactly the same as today's capitalists who have more than enough capital but keep amassing it. > Right, but at that individual level too, capital isn't really the issue these days. You can get a loan for anything, anyone can get a credit card. If someone wants to improve themselves, it's rarely capital that's the limiting factor - it's more likely to either be time, or something a bit more complicated. I find this could be a bit more credible than the "bay area venture capitalists blowing money on idiotic things therefore capital is post-scarcity" line of argument. Is it really true though? The median net worth of a person under 35 in USA the internet says is $14,000. How much of a loan is that kind of collateral going to get me if I'm clearly already living pretty much hand to mouth? Can I reduce my working hours, take the loan, and go to school? Or to start my own small business? What is the risk I'm taking on?
- nine_k 5y ago
  I'd like to repeat someone's HN comment: what limits the (Western) civilization is the power of the collective intellect, the amount of effective thinking per day. Attention is a proxy to it, rather imprecise but easy to measure. A lot of our problems stem from the fact that we don't know how to tackle them. We have the money and the resources money can buy, but we don't have a clear idea. We keep thinking and trying stuff, but apparently not very efficiently, because practical results are few; often we don't even seriously do that. This applies to everything, from curing common cold to solving global warming. Profitable investment of any kind is among these problems.
  - hakfoo 5y ago
    I tend to categorize this as a combination of three problems: 1. We don't have a single defining policy platform for our society. If the CCP puts out a detailed timeline to a zero-carbon China, they have all the economic and political levers they need to pull in one place. No person or group in the US has any comparable authority. 2. Because of this, western countries tend to be limited to piecemeal solutions that can fit into smaller scale budgets and timelines. We can sell one power plant at a time, rather than a clearly strategized 50 year rundown to zero emissions. That means a lot of either-or decisions (Solar or traditional nuclear or Thorium, not funding all three) and a lot of people who are fundamentally on the same side get caught in infighting and bikeshedding trying to compete for limited opportunities. 3. You're often dealing with a problem where the solution is "yeet the entrenched counterinterest." The counter-interest group in 3) really just has to prevent you from doing anything to win, so it tends to encourage 2) as a cheap way to keep the opposition fractured.
  - WJW 5y ago
    I'd argue that for most of the "Big" problems (world peace, nuclear proliferation, pollution, climate change and providing food/education/healthcare to all) the problem can be summarized as "lack of collective will to make the changes required". It is pretty clear what we would need to do to drastically reduce carbon emissions for example, but almost nobody is willing to make the economic sacrifices required.
    - 5y ago
- onlyrealcuzzo 5y ago
  > So what are we out of? Cures for diseases and cancers, people being not-poor, cities being clean and beautiful, a sustainable climate, equal opportunity for everyone, justice, kindness, not-having-war, not needing to work, etc... Why can we only be "out of" toasters and toilets and not "everyone having an easily imaginable higher quality life"? I get it that the Federal Reserve lowering interest rates is unlikely to give everyone a better life. That takes hard work and progress, something which cannot simply be bought by changing numbers on a spreadsheet. But these could things could - theoretically - be financed! Most, probably not with VC.

Animats 5y ago

(If I have an economic position, it's perhaps close to Piketty. Although he draws on pre-industrial age statistics too much.) My main criticism of this revolves around the question "what are we out of that limits society?". The author argues that capital is not scarce, which seems to be true for the US. He argues that attention is scarce, which is reasonable. He then takes the big jump. He argues that attention is the primary limiting factor on, in some sense, "progress". That's where his argument goes bad. That limiting factor applies to a small part of the economy, but it's the part that gets much VC attention. So what are we out of? This is a crucial question. I'm not going to try to propose an answer. But it's the right question to ask. When something other than capital limits output, capital markets don't send the right signals to direct effort in useful directions. This leads to somewhat strange investments chewing up large amounts of capital. HN readers don't need examples of this.

throwawaylinux 5y ago
I know very little about economics particularly the academic / theoretical side of it. You and Wenger here both seem to agree there is an abundance of capital (money?) and that's not the "limiting factor" at least in the US. He writes > When we were foragers, food was scarce. During the agrarian age, it was land. Following the industrial revolution, capital became scarce. I don't really see how they are equivalent. Or actually I do they how they are equivalent but not in the way he writes. For tribal chiefs, food probably wasn't scarce. For kings and lords, land was not scarce. For industrialists, capital was not scarce. Wealthy people haven't just started doing strange things with capital as though they hadn't in the past with capital or land or food. Food wastage was a point of pride in elite society of the past, locking away vast amounts of productive land for private game parks, and investing wealth in all sorts of foolish ventures has been pretty common throughout history. Yet all of those things were (and many still are) scarce for many people including in the US. So why do you say it's not, and what do you mean by "limits" of society exactly? If a person can't buy a car or an education or a computer or tools or time to practice a new skill, then they can't work (or have less opportunity to) or they can't increase their productivity as much. Or they can't afford to have or put as much time and money into their children, which further limits society in the longer term. I'm no collectivist, anti-capitalist, or social justice activist, I think inequality will always be here and it's our curse and our blessing. But surely we can't say capital is not scarce or doesn't matter so long as a significant number of people are limited by their own lack of it. Limited not just in entertainment and frivolous things but constructive wealth creating activities. Have I completely misunderstood the whole thing?
- xcambar 5y ago
  > I think inequality will always be here and it's our curse and our blessing. ...say people who are on the blessing side of inequality. Note: I am on the blessing side as well. I have no experience whatsoever about what it means to suffer from inequality.
  - throwawaylinux 5y ago
    > ...say people who are on the blessing side of inequality. This isn't an argument I'm afraid. > Note: I am on the blessing side as well. I have no experience whatsoever about what it means to suffer from inequality. Yes you do. Not everybody who is less well off than you live a life of misery and unhappiness and desperation. There would even be many very poor people who have happier and more fulfilling lives than you do I would wager.
- lmm 5y ago
  > For tribal chiefs, food probably wasn't scarce. For kings and lords, land was not scarce. For industrialists, capital was not scarce. On the contrary, kings and lords were acutely aware of how much land they had and devoted much of their energy to amassing more. Likewise for tribal chiefs and food, and presumably likewise for industrial. They had more of it than others, sure, but it was scarce for them: it was the limiting factor on what they were doing. > If a person can't buy a car or an education or a computer or tools or time to practice a new skill, then they can't work (or have less opportunity to) or they can't increase their productivity as much. Or they can't afford to have or put as much time and money into their children, which further limits society in the longer term. Right, but at that individual level too, capital isn't really the issue these days. You can get a loan for anything, anyone can get a credit card. If someone wants to improve themselves, it's rarely capital that's the limiting factor - it's more likely to either be time, or something a bit more complicated.
  - throwawaylinux 5y ago
    > On the contrary, kings and lords were acutely aware of how much land they had and devoted much of their energy to amassing more. Likewise for tribal chiefs and food, and presumably likewise for industrial. They had more of it than others, sure, but it was scarce for them: it was the limiting factor on what they were doing. So it's exactly the same as today's capitalists who have more than enough capital but keep amassing it. > Right, but at that individual level too, capital isn't really the issue these days. You can get a loan for anything, anyone can get a credit card. If someone wants to improve themselves, it's rarely capital that's the limiting factor - it's more likely to either be time, or something a bit more complicated. I find this could be a bit more credible than the "bay area venture capitalists blowing money on idiotic things therefore capital is post-scarcity" line of argument. Is it really true though? The median net worth of a person under 35 in USA the internet says is $14,000. How much of a loan is that kind of collateral going to get me if I'm clearly already living pretty much hand to mouth? Can I reduce my working hours, take the loan, and go to school? Or to start my own small business? What is the risk I'm taking on?
nine_k 5y ago
I'd like to repeat someone's HN comment: what limits the (Western) civilization is the power of the collective intellect, the amount of effective thinking per day. Attention is a proxy to it, rather imprecise but easy to measure. A lot of our problems stem from the fact that we don't know how to tackle them. We have the money and the resources money can buy, but we don't have a clear idea. We keep thinking and trying stuff, but apparently not very efficiently, because practical results are few; often we don't even seriously do that. This applies to everything, from curing common cold to solving global warming. Profitable investment of any kind is among these problems.
- hakfoo 5y ago
  I tend to categorize this as a combination of three problems: 1. We don't have a single defining policy platform for our society. If the CCP puts out a detailed timeline to a zero-carbon China, they have all the economic and political levers they need to pull in one place. No person or group in the US has any comparable authority. 2. Because of this, western countries tend to be limited to piecemeal solutions that can fit into smaller scale budgets and timelines. We can sell one power plant at a time, rather than a clearly strategized 50 year rundown to zero emissions. That means a lot of either-or decisions (Solar or traditional nuclear or Thorium, not funding all three) and a lot of people who are fundamentally on the same side get caught in infighting and bikeshedding trying to compete for limited opportunities. 3. You're often dealing with a problem where the solution is "yeet the entrenched counterinterest." The counter-interest group in 3) really just has to prevent you from doing anything to win, so it tends to encourage 2) as a cheap way to keep the opposition fractured.
- WJW 5y ago
  I'd argue that for most of the "Big" problems (world peace, nuclear proliferation, pollution, climate change and providing food/education/healthcare to all) the problem can be summarized as "lack of collective will to make the changes required". It is pretty clear what we would need to do to drastically reduce carbon emissions for example, but almost nobody is willing to make the economic sacrifices required.
  - 5y ago
onlyrealcuzzo 5y ago
> So what are we out of? Cures for diseases and cancers, people being not-poor, cities being clean and beautiful, a sustainable climate, equal opportunity for everyone, justice, kindness, not-having-war, not needing to work, etc... Why can we only be "out of" toasters and toilets and not "everyone having an easily imaginable higher quality life"? I get it that the Federal Reserve lowering interest rates is unlikely to give everyone a better life. That takes hard work and progress, something which cannot simply be bought by changing numbers on a spreadsheet. But these could things could - theoretically - be financed! Most, probably not with VC.