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It's interesting to me that the stagnating or declining middle class is largely a first world issue, while in the developing world the middle class is exploding
by api 12y ago
It's interesting to me that the stagnating or declining middle class is largely a first world issue, while in the developing world the middle class is exploding.
The best explanation I've encountered is Peter Thiel's commentary on horizontal vs. vertical development. We've taken an energy and industrial system that absolutely cannot scale to seven billion people and now we're trying to make it scale to seven billion people. The result is a kind of low-grade, very slow malthusian event in which people in the developed world are (relatively speaking) impoverished by exploding energy and resource costs. What we need is vertical development -- technological development -- to create systems that actually will scale. Everybody can't drive a hydrocarbon powered car. It can't be done.
I think this also explains why first world poverty rates are not shrinking. The poorer you are the more price sensitive you are to things like energy prices, so the poor are impacted by scarcity exponentially more than the wealthy.
Note that if this is true then wealth redistribution might not help. It might just trigger price inflation in scarce resources. Redistribute more and they'll inflate more, and more, and more. ... But then again maybe it would help by causing lots of investment money to chase that demand and develop alternatives. It would cause hockey stick price signals across all the rate limiting inputs for the economy.
Hmm... well now... maybe we should drop money from helicopters...
- JetSpiegel 12y agoRich guy says "wealth redistribution" doesn't work. Suure, let's take that at face value.
- api 12y agoActually Thiel didn't say that, but I assume given his right-libertarian views he's against it. Peter Thiel is a mixed bag for me. He sometimes has profoundly interesting things to say, but then he says things that strike me as either deeply naive or disingenuous. I'm still not sure which, and no I do not think naive and billionaire are mutually exclusive. I spent enough time in the ivy league orbit to know that "elite naiveté" is a thing. I'm personally both for it and against it. I'm against it in perfect world post-violence volitional society land, but I'm for it in pragmatic real Earth that we live on right now land. The problem is that we absolutely do not live in a volitional society, and pretending we do often results in worse injustices than the pragmatic approach. Our world is run by gangsters and armies with fraud and guns. It's not that far removed from the ancient tribalism we clawed our way out of. Wealth redistribution is an acceptable band aid that moves us in the right fundamentally humanistic direction. It empowers the great unwashed masses to improve their bodies and minds. Abolishing wealth redistribution amounts to a kind of unilateral disarmament unless you can also convince all global elites to stop using violence and deception to advance their own economic goals.