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Oligarchy, Predators, and Parasites: What the New Feudalists Would Be Doing Now, if They Had Sense.

The smartest billionaires today want nothing to do with feudalist trends

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By David Brin

Evonomics is burgeoning rapidly into the go-to place where sane-insightful sages discuss what’s gone wrong with modern capitalism. Not from any leftist or hostile perspective, but with an eye to rescuing the goose that has laid our golden eggs — truly creative-competitive enterprise. These top folks refute the notion that our struggles are “left vs right.” Market economics can be saved, and generate the vast (and efficient) wealth enabling us to redouble generosity, if it is again made to be flat-open-fair.

Take this interview with Michael Hudson, author of Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy. Wherein the agenda is not to oppose competitive capitalism… rather the parasitical manipulators who Adam Smith himself denounced as markets’ worst enemies… and have been for 6000 years.

Predators and Parasites

Prof. David Sloan Wilson interviews Lynn Stout – Distinguished Professor of Corporate and Business Law at the Cornell – on the hoary mythology spread decades ago by Milton Friedman, that the only purpose of a modern corporation is to maximize short term value to stockholders. A cancerous dogma that is at last being dissected, disproved on every level and demolished.

For example, Wilson cites a major study which monitored the survival of 136 firms starting from the time they initiated their public offering on the U.S. Stock Market. Five years later, the survivors—by a wide margin—were firms that did best by their employees.

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Other critics show that Friedman’s cult encourages companies into short-term thinking and stock buy-backs instead of investing in new products – eating their seed corn – which is exactly the opposite of what we were promised by “supply side” zealots. Then there are “externalities” where corporations will ignore the needs of our children (e.g a less-toxic planet) unless regulated into taking such factors into account, in pricing.

Sure, oligarchs want oligarchy. But can it be smart? 

Here’s a perfect IQ test for the 0.001% aristocrats. Are you uber-oligarchs capable of noticing when greed may tip way beyond mere economic stupidity and immorality into life threatening self-destruction? When – as happened many times in the past – insatiable top-down class war could wind up taking you on a tumbrel ride toward guillotines

This fascinating open letter from a rich man to his fellow zillionaires makes a point that was stated eloquently by Joseph Kennedy, to explain why that ruthlessly self-serving mogul supported FDR during the Great Depression: “I’d rather lose half my fortune to help raise a healthy and contented middle class than lose it all to revolution.”

In other words. Self-interest should look to farther horizons.
 Hence, looking ahead, Nick Hanauer – a Seattle-based entrepreneur and early Amazon investor – published an “Ultra-rich man’s letter: To My Fellow Filthy Rich Americans. The Pitchforks Are Coming.

“Seeing where things are headed is the essence of entrepreneurship. And what do I see in our future now? I see pitchforks. At the same time that people like you and me are thriving beyond the dreams of any plutocrats in history, the rest of the country—the 99.99 percent—is lagging far behind…. Unless our policies change dramatically, the middle class will disappear, and we will be back to late 18th-century France. Before the revolution.”

Nor is Hanauer alone. Among U.S. billionaires and sub-billionaires, those who got rich through technological innovation, through delivery of new and popular goods and services, have increasingly expressed the same worry.  They became wealthy working side by side with creative, middle class engineers, scientists, artists, etc. Moreover, they increasingly find present trends — set in motion largely by “supply side” so-called ‘economics’ — to be deeply destructive and dangerous voodoo.

Which is ironic to a stunning degree; they are the only billionaires who did use Bush tax cuts to invest in productive innovations and goods. Yet they are nearly all now democrats, calling for an end to those tax cuts. 

It is the other branch of uber-wealth — those who got it via Wall Street parasitism, resource extraction-exploitation, capturing regulators or inheritance — who seem mostly unable to read the writing on the wall.  While congratulating themselves that they are geniuses, they happily ignore lessons of history.

I might add that any ‘angry peasants’ in the future will be far better armed than the 1789 Jacobins. Forget torches and pitchforks. Many will have fancy tools of cyber or genetic or chemical engineering. ISIS is a joke compared to what an enraged American technical caste could do, if (no, when) they ever wake up and rediscover that every human generation except the Baby Boomers knew class war.

Boomers grew up in an illusion of classlessness because the Rooseveltean reforms enacted by the Greatest Generation were so spectacularly successful! And another such moderate/pragmatic reset is still possible, reviving healthy-competitive market enterprise while re-invigoration the great middle. That is, if the oligarchy listen to folks like Hanauer.

Farmers awaken

Nor is Hanauer alone. We know that most of the tech billionaires have joined Warren Buffet in rejecting the winner-takes-all mantra of Fox-style economics. But how about midwest agri-business leaders?

Greg Page is executive chairman and former CEO of Cargill, Inc., the largest private company in the U.S. Page participated in the high-level “Risk Committee” of top business leaders that forecast the US economy could suffer damages running into the hundreds of billions of dollars by the end of the century due to climate change.

Page describes the northward movement of the American agricultural belt. As average temperatures have risen over the past decades, the growing season in the northern plains has expanded, while heat waves further south baked America’s traditional agriculture producing states like Iowa, Oklahoma, Nebraska and Texas.

These explorations continue on Evonomics. In this article economist Sally J. Goerner elucidates why the “Trump-Sanders Phenomenon Signals an Oligarchy on the Brink of a Civilization-Threatening Collapse.” Goerner maintains that: “oligarchies always collapse because they are designed to extract wealth from the lower levels of society, concentrate it at the top, and block adaptation by concentrating oligarchic power as well.”  

History shows that this tendency can be periodically corrected. If done in a moderate but determined way, the public will mobilize behind honest leaders and effective reforms.

Or as Will and Ariel Durant wrote in The Story of Civilization: “…the unstable equilibrium generates a critical situation, which history has diversely met by legislation redistributing wealth or by revolution distributing poverty.”

Of course we know why the oligarchy has tried so hard to turn lower middle class anger toward all the meritocratic professions. Especially toward the technology castes. Get working class whites to despise modernity and scientists, doctors, teachers, journalists, economists, civil servants… hey it worked in 1930s Germany and in the Confederate south. And look how well those turned out.

This is why the tech billionaires… most of them… are democrats nowadays. As would be Adam Smith, if he were alive today. They want an FDR to get them out of this bind, and not a Robespierre. And it is why we must pry the hands of the other kind of oligarch — those who fail this IQ test — off of society’s tiller. If theses guys are so rich, why ain’t they smart?

What they’d be doing now, if they truly were smart

Some of you may recall a scene in Existence, set at a Swiss Alps meeting of the Trillionaires’ oligarchy? I portrayed what I think aristos would be doing now, if they were both smart and wanted to restore feudalism, without repeating the same damned mistakes that feudalism made across 6000 years.

Do I oppose feudalism? With all my soul. But so did Machiavelli, fighting for the Florentine Republic. Then, when it was clear there was no hope at all and all was finished, he got employment trying to talk the artistos into at least being smart about it. (Hint, I am willing, under carefully defined circumstances, to consult discretely on this matter, with some exceptional suggestions… accompanied by a wagging of fingers. And if finger-wags deter you guys from seeking the best ideas – and I have the best – then you’ll deserve what inevitably happens to you.)

Alas, there’s a quandary here. The smartest billionaires today want nothing to do with feudalist trends. But feudalist trends are powerful in themselves and favor the dumb rapacious kind. The type who will never hold meetings of the kind I portrayed in Existence.

Indeed, it is doubtful that many of them read. Yet they hire flatterers to tell them how smart they are.

Thus proving the very opposite.

Right vs Left Solutions

How shall we measure politics? According to hoary, insipidly lobotomizing metaphors like “left-vs-right,” which none of you could properly define, even if your lives depended on it.

Or according to what we really need, today, which is pragmatic flexibility – a willingness to drop stale dogmas and do what’s right for our children and the world. Okay, then dig this… the Obama Administration – backed up my many modern environmentalists –is exploring ways to help the U.S. nuclear industry survive and keep reactors running, to weather hard times brought by cheap natural gas.

Mind you, that cheap gas is a huge improvement over relying on filthy coal. And the long term solution is looming fast, with solar, wind, tidal and storage power becoming economical faster than even optimists expected. Still, nuclear is now viewed much more favorably by techno-liberals, starting some years ago with Stewart Brand and others, but increasingly by mainline environmental groups.

Oh, they are still wary!  And problems with spent fuel are worrisome. And we can argue which newer “better” fuel cycles deserve investment. But keeping currently clean, already running nuclear plants going would seem blatantly in our interest.

Moreover, this shift by liberals is diametrically opposite to their political opponents on the right, who cannot even begin to ponder changing their minds in the face of evidence. About anything. Ever.

And that – rather than any “left” or “right” nostrum – is the real difference in U.S. politics today.

2016 August 9


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  • A great deal of truth in all you write David.

    Yet you do not explicitly reference the 18ft caterpillar on the coffee table: which is the fact that anything that is fully automated has zero market value, and that the set of goods and services that can be fully automated is already large and is exponentially expanding.

    Markets only measure unmet demand.
    Markets can only work where people don’t have all they need.
    So poverty is structural to a market system.
    That wasn’t an issue when most things were genuinely scarce.
    It is very much an issue (a core issue of injustice, that is becoming far more generally known) in an age where most things can be automated to universal abundance.

    Most people don’t need a lot.
    If you have fully automated climate controlled greenhouse production, then 100 square meters can feed a person easily. It takes about 20 square meters of solar cells to deliver enough energy to produce 1.5T per year of steel, while 1 square meter can supply the energy to deliver 15g of semiconductor grade silicon. 100 square meters of solar cells delivers plenty of energy for a very high standard of living. Allowing another 100 for sundry other requirements – 300 sq m / person – and leaving half the land area in its natural state, the continental USA could hold twice the world’s current population.

    We are not short of land, energy or materials.

    There is no need for poverty, anyone, anywhere.

    No market based system, in and of its own internal incentive structures, will ever eliminate poverty. Adam Smith knew that. It is almost 250 years since he published his Theory of Moral Sentiment, which for all its many errors is still a profound work, as is the Wealth of Nations.

    I agree with all you wrote above, and what I am saying here is deeper than that.

    There are many people who really do want to live a very long time.

    Those at the peak of the capitalist heap do not want to be an impediment to that – that is a very dangerous strategy – for everyone!!!

    I am not suggesting that everyone have the same – quite the opposite.

    And I am demanding that everyone have a high minimum – what most alive today would consider a high minimum – 20 KW continuous power over and above subsistence, with all the distributed redundancy of automated production and service delivery necessary to ensure security for all.

    And I acknowledge it will take time to deliver, and that time has to be less than 10 years, preferably less than 5 – 2020 is a good target date.

    • Crayven

      THANK YOU !
      There! See? This man understands !

      Markets are “done”. The old system is finished and we would all benefit – even the rich – if we admit it and move on.
      Technology can free us all. We only need the will to use it.

    • Robert Lapsley

      I find myself hesitant to comment. Even though I accept you are more abreast the advancing tech innovations and know better than I… Still, when I hear you and others have faith in a technological fix to our economic problems, imply a targeted and planned fix, for engineered innovations creating our better future … I feel compelled to offer a glass half empty view for consideration.
      I am reminded that we did not plan and then execute the Information Age. Of all that came with the last quarter of the twentieth century, the advent of computers, satellite communications, internet, and social media, they are happy accidents few if any envisioned. Like most our disruptive technologies, they are more the results of our working through and around our previously immediate barriers. Our focus did (and continues) to press into and explore many locally accessible ways forward, and these efforts lead to unanticipated discoveries. Throughout history our discoveries allowed for our transformations. Our discoveries reworked, reimagined and recombined led the way to the actual future we realized. It is a stretch to say we predicted it and planned for it.
      To now expect that the entailed problems that accompanied the sweeping changes of our times can be alleviated and transformed into solutions with the advent of “universal replicators”… Well, that’s a stretch. And I have even read predictions: “no one will ever work for another human again” (!?) Sorry to say,
      I kind of doubt that. Some basic physics stand between here and the universal replicator; some formidable engineering is required before that dream is realized.
      If I have learned anything in this life, it is that our claim on the future is at best unpredictable. And for all our prognostications, the future that we made real is nothing like what we were forecasting. And if a cure for the common cold, or a cure for cancer is realized, they are long over due. I am not saying they are not in the offing, just saying that the change we aim for comes, more often than not, later than expected, if at all.
      historically our best laid plans, say, to create a just and civil society, end poverty, feed the hungry, stem climate change, these may take even longer to arrive than the universal replicator’s anticipated due date. I hope we can hang on to the plow long enough get through the tough rows between here and there.

      • Hi Robert,

        I kind of agree with you, and kind of don’t.

        If I were planning some grand thing to solve everything and provide the perfect life to everyone, then I would be very skeptical of that.

        What I am planning could act as enabler of people getting to do whatever they responsibly choose, so in that sense it does help people, and it doesn’t determine what those choices are. So it isn’t directional in that sense, just a tool that enables people to go in a direction of their choice (like the motorvehicle is for many in the realm of transport, except at one level higher of abstraction).

        I fully agree with you, that things will change. There is a lot of randomness in reality.

        I’m not trying in any way to remove that, much more along the lines of celebrating it.

        And yes – building that machine is a significant engineering challenge, in the same way that building the first Nimitz Class aircraft carrier was a significant engineering challenge.

        The differences are also significant. We are looking to put together a machine that only weighs a few tons, but has the ability to make another copy of itself. So don’t need a lot of materials, and we do need a lot of very smart people with some very expensive tools to stick it all together and get all the bugs out of the systems.

        I am definitely not trying to determine what everyone does.
        That is not part of my plan.
        I am trying to set up systems to ensure what every doesn’t do – which is pose any unnecessary risk to the life and liberty of anyone else, or to the biosphere.

        I am all for unanticipated discoveries – I love them.

        And it took a lot of work to eradicate smallpox. That was planned, and achieved.
        Such planning is possible.
        People have developed amazing technologies to plans (and continue to do so).
        And there are usually unanticipated things along the way – to me that’s called life.

        I am definitely not making any claim to predict all possible futures.
        And we do predict futures all the time.
        Every time someone sets out to build something, there is a set of predictions involved, and usually a set of unpredicted things happen along the way, and are dealt with in such a way that the predicted thing happens, be it a house, a sky-scraper, a yacht, a computer system, a self driving car, or whatever.

        No one need ever work for anyone else, and anyone can choose to work with whomever reciprocates that desire. Such agreements would seem to me to be very probable indeed.

        We are social entities.
        Most of us form many associations outside of paid work, even now.

        A couple of predictions I do make.
        The rate of technical change and innovation will increase exponentially under such a system – without the constraints that market forces impose on us at present.
        Most people would find such an existence far more interesting and secure than their current existence.

        Beyond that, I have little idea what people will actually choose to do.

        And there will be a transition phase, from the ways of being we have now, to the new ways that become possible.
        I strongly suspect that there will be many thousands of different and successful ways of managing that transition.

        Having faced a terminal cancer diagnosis, I did have to find a cure for that particular problem, in my particular case. What I did worked, and it was much more difficult than having some doctor prescribe something. And that is a different story, already well documented on my blog.

        No one has been able to create a just and fair society, because everyone requires servants to do the work they don’t want to, but needs to be done. That is the single key difference that this level of automation provides.
        Everyone gets a set of fully automated servants.

        Yes – there is a lot of work to be done.
        And a lot has been done in the 42 years since I started talking about things like this.

        When I first stood for parliament on this platform (11 years ago) I got 180 votes.
        I knew that was the likely outcome, and it was part of the process of initiating conversations at different levels.

        I am currently standing for Mayor of our town, and I may just actually win this time.
        The conversation is spreading. Awareness is happening.

        And yes – we live in a very complex reality, that is in many aspects fundamentally unpredictable, even if some things (like sunrise, or GPS systems) are very predictable and very reliable.

        And like you, I will keep on working, and I have a very clear goal of enabling everyone on the planet to live as long as they choose to, and ensuring that they are empowered throughout that life to do whatever they responsibly choose (myself included in that – and wanting it for myself, the only way I can see of creating the sort of security that delivers a reasonable probability of such a very long life is to deliver it to everyone).

  • Ted Howard almost got it right. When 3-D printers become universal replicators, aka Star Trek, economics as we’ve known it, all around the world, will cease to exist.
    Think about it. The first such replicator will be insanely expensive to develop, the second will cut that in half, four, cut into quarters, and so on, until replicators become literally dirt cheap. As they produce their own “toner” with any kind of waste you can think of, and as people develop millions, and then billions of different CAD programs for anything you can imagine, including endless varieties of food dishes, and embedded solar panels in rooftops, roads, sidewalks, patios, take up production of any locally needed energy, everyone, and I mean everyone will be essentially billionaires
    No one would ever work for a living again. No one would pay a penny for anything ever again. Cell repair machines would take over health care. Brain augments would end education as we’ve known it. The most radical decentralization in the history of the world, even more decentralized that hunter-gatherer bands, would sweep across humanity. Except for some forms of policing, government as we’ve known it would cease to exist. Programs as voted for in Washington would be rendered superfluous.
    With accelerating tech, I believe this will all happen next decade. Through the efforts of both high tech capitalists and garage DIYers. The process itself will be hugely decentralized. Perhaps there are evil billionairs out there trying to stop it (I believe most are clueless), but they don’t stand a chance. They can’t control what they don’t know, and what’s going on right now is largely unknowable even by the technologically astute.
    So, quit worrying. Participate. Enjoy the process.
    And David Brin would never have to worry about politics or economics again. And neither would the rest of us.

    • Hi Sally – take a look at a website I put up 25 years ago – http://www.solnx.org
      Maybe a little more than “almost” 😉

      • Thanks for the link. Great minds think alike, eh? Actually, I got my ideas from Drexler (nanotechnology), Kurzweil and his Law of Accelerating Returns, numerous people working on 3-D printers and writing about implications, and Peter Diamandis and his book Abundance: http://www.diamandis.com/abundance/ And unlike many (but not all) writers who have published essays here at Evonomics, I believe free markets are the best, most intelligent way for us to get to the Abundance society. Instead of a few government bureaucrats trying to guide us, millions of people with their purchasing power and thousands of companies with their high-tech inventiveness will bring us there.

        • Hi Sally,
          Yeah – Drexler had some great ideas. I attended the 25th Foresight conference at Google’s Headquarters a few years ago.

          I am definitely no fan of central control at any level.
          I am also clear that markets have passed their peak utility.
          The problem with markets is that they cannot deliver a positive value for anything that is universally abundant. Thus no market based system can ever, of its own internal incentive structure, incentivise universal abundance of anything. That means that in practice, markets will always have meta level incentives to prevent or remove any universal abundance that does develop. In a very real sense, that is all that IP laws are.

          So while I am all for individual freedom and individual empowerment, I am no longer the fan of free markets I once was.

          I see clearly now that markets are not the great friend of liberty that many think.
          We now have far more effective ways of decentralising and empowering distributed decision making and communication more generally.

          So for me, free markets are not the opposite of government control.
          For me, both free markets and central control pose unacceptable risks to life and liberty.
          We need a different paradigm.
          Fortunately there are an infinite set of possibilities, some quite close in the possibility space of all possible strategies. And many of them are relatively trivial to implement with modern technology.

          I align with a lot of things Peter Diamandis says, but not with his unquestioning acceptance of market dogma.
          Companies are not inventive – some of the individuals they employ are.

    • Andrés Baldrich

      This could happen for goods, not for services. Do you consume services? Then you’ll still pay the doctor, actor, bartender, etc.

  • Colm McGinn

    Fairly irritating, this ‘new’ idea you offer, that “Right vs Left Solutions” are deceased, irrelevant.

    Or as you put it:
    “How shall we measure politics? According to hoary, insipidly lobotomizing metaphors like “left-vs-right,” which none of you could properly define, even if your lives depended on it.

    Or according to what we really need, today, which is pragmatic flexibility – a willingness to drop stale dogmas and do what’s right for our children and the world.”

    I mean, really, have a wee wise up. To have a change from the present paradigms of power and politics, humanity will need to trade-in the present elites, owners of capital and therefore power, for some alternative. That alternative does not arise from the goodness of someone’s heart, but from the conflict of ideas and then groups of people for power, optimally achieved through existing political structures and methods, but if that doesn’t work, whatever other way proves necessary.

    That is the essence of ‘Left versus Right’, which you want to dump because you don’t like the conflict. All things considered, (global warming, climate change consequent, population migration, manipulation and oppression of non-elite populations, pollution from the industrial processes these elites prefer in their self-aggrandizement and theft of the common wealth), if they outlive their usefulness, then the rest of us can take the steps to make that quite clear to them.

    Some sort of techno-optimism and belief in a technocratic elite is not to cut it, when a billion humans are starving, with all that implies.

    • Duncan Cairncross

      “Some sort of techno-optimism and belief in a technocratic elite is not
      to cut it, when a billion humans are starving, with all that implies.”

      Do you actually know anything about history?

      About how many people are starving?
      The world has gone down from 42% in extreme poverty in 1990 to 13% now
      That is still 13% too high BUT it is one hell of a lot better than 42%

  • carmiturchick

    All of the authors here at evonomics believe that they can blithely talk about parasites and predators while knowing jack all about the topics. Why do some people dedicate their lives to understanding parasitism if there is nothing to understand?

    If you are going to say “x industries or corporate behaviors are parasitic” then you are obligated to actually know what parasitism IS and what the implications of your assertion are. And to the extent that this assertion is correct, you are not going to understand what solutions this implies unless, again, you study the evolution of virulence and commensalism in parasites.

    Where does the evo part come in here if you are going to continue to publish article after article written in utter ignorance of evolution?

    • Crayven

      Care to explain what they got wrong?

      • carmiturchick

        First of all, parasitism is a spectrum, not a point. Parasites can be more or less virulent, more or less commensal, and flexible in their approach depending on their environment. Some of our gut bacteria are beneficial in most circumstances, for example, but if our immune system collapses they can attack and cause multiple organ failure and death. This seems similar to me to what happens when we deregulate industries.

        Really the question is, IF we can consider corporations parasitic, how then do we model their interactions with each other and with society? Evolution is involved and it is not simple, you can read my very basic starting effort along these lines here:

        http://theroadtopeace.blogspot.com/

        • And “parasite” is usually just name calling in political discourse. I guarantee you no one who uses that epithet has the foggiest notion of what real parasites are or do. They just think the word sounds nasty, like fascist did in the 60s, and like the word racist does today.

          • carmiturchick

            Yes, and normally I do not care if they are just engaging in name calling in some political site or publication. But here the site claims to be all up in the science and evolution business, and it is associated with real serious scientists that I have incredible respect for like David Sloan Wilson. Here at Evonomics I think if you make that claim then you and the editors have an obligation to the readers and to the real scientists whose reputations are associated with this Evonomics project to actually know what the hell a parasite is and what making that comparison means. The editor here seems to disagree with this view.

  • Crayven

    Please…we don’t want to save “the free market system and capitalism”, we want to DESTROY it.

    Capitalism *IS* the problem. It’s always been the problem.

    Even if you force the super rich to give up their wealth and restart from zero – the system will create NEW super rich and the world will be destroyed by them.

    Global warming will not wait for your pathetic “reforms”.
    We need RADICAL change NOW!

  • fakefighter

    “How shall we measure politics? According to hoary, insipidly
    lobotomizing metaphors like “left-vs-right,” which none of you could
    properly define, even if your lives depended on it.” Just because an astrophysicist doesn’t know the definition to those words, doesn’t mean they don’t actually mean anything. But generally STEM majors are bad at understanding they’re not actually good about writing authoritatively about the social sciences.

    • In the American political spectrum, Left pretty much means centralize all decision-making in economics, politics, and a politically correct culture. Right pretty much means the opposite. David Brin is on the Left, even though he doesn’t want to admit it. Naturally, I’m toward the Right end of the spectrum, for traditional reasons of concern for individual economic and political liberty and for some highly non-traditional accelerating tech and science reasons. I believe decentralization is not only morally correct, but also permits more effective managing of change as it happens faster and faster.