- huge amount of very cheap money
- widespread availability of highly educated technologists
- knowledge of the climate model
.. and instead "collectively" ended up funding giveaway services to users and inflating the SF housing market rather than doing the climate Manhattan project.
(High interest rates are bad for renewables, because buying a solar panel is effectively buying 20-30 years of electricity upfront, and therefore hugely dependent on cost of capital and discount rates)
Because to me, if your not Twitter, your Wal Mart or Raytheon or BoA. If your not shittifying a platform you are pushing out small businesses from every town, price gouging government contracts for missiles, fooling elderly people with complicated financial interests.
I just can't really put together any argument at all, if am being honest, to justify the idea that companies with a self interest in profit will reliably help people or the world. It just does not at all feel rational, its like everyone in the world is dreaming.
Free-market types used to have some assumptions about how free markets are expected to work, then they would derive the result that a free market yields a net benefit to society from those assumptions.
Now it is glaringly obvious that a free market can cause a net loss to society, but they still need to believe free markets are good. So they ignore the evidence, and instead of deriving the result from assumptions, they treat it as an axiom instead.
IME 80% of criticisms of “free market” is actually a criticism of government policy (and then the same critics think that more of those policies are called for!)
Fortunately, most economists already agree that market failures exist, and that free-market economics is bunk.
> Just don't understand how one could be convinced these days of the fundamental conceit that even a properly profitable company is necessarily going to provide good things for people downstream, or for society in general.
> What is the argument for that in general again?
> the idea that companies with a self interest in profit will reliably help people or the world
> It just does not at all feel rational, its like everyone in the world is dreaming.
[1] https://www.youtube.com/watch?v=RWsx1X8PV_A
[2] https://www.nytimes.com/2020/09/13/business/dealbook/milton-...
He thought that smaller, owner operated businesses would outcompete joint stock companies, primarily because the incentives between owners and managers were aligned.
Managers managing other people's money will make worse decisions over the long term than managers managing their own money.
That was his theory back in 1776, things didn't turn out that way obviously.
> That was his theory back in 1776, things didn't turn out that way obviously
I'm not a big fan of capitalism as it can be an utterly cruel mistress, but given the unfortunate realities of human nature I can't think of a system that is on the whole better. As long as there is scarcity, there will be something used as a basis for rationing (who gets what, and why). If it's not who is willing to pay the most, then it's who has the most powerful friends or the biggest army, or something else. There are problems with under-checked capitalism, and there are problems with over-checked capitalism. We'll never get it just right because humans aren't smart enough to, but perhaps we'll achieve post-scarcity at some point. One can hope.
And people can make decisions, even the ones who run companies, to balance profits with contributing to a greater good. But they choose not to.
So the people who are running these companies are choosing to prioritize profits at all costs. Some of this is because the people who operate the financial markets tell them they will be punished if they don't, but obviously there's also some agency on the part of the company leadership as well.
Companies are allowed to exist because they provide some common good, in exchange for us allowing them to profit and have limited liability. I think companies have forgotten this bargain, and feel they simply have the right to exist and that their only duty is to provide profit to shareholders.
The people should hold companies to a high standard, and demand that they also serve the public good in addition to serving their shareholders. And we should revoke companies' existence when they fail to uphold their side of the bargain. When was the last time that happened to a major company--that their business charter was revoked by the government for wrongdoing? We've gotten so used to simping for companies and not holding them accountable that they now strongly believe their only obligation is to their shareholders and financial markets.
> pushing out small businesses from every town
Those small businesses are also run on a for profit basis and are market driven. If there is something causing them to fail despite providing a better quality of service then perhaps we are still looking at market distortions rather than a fundamental failing of capitalism.
Artificially low interest rate environments lead to a lot of money in the hands of investors, which due to inflation slowly loses purchasing power over time. However, with large reserves, they can easily afford to prop up a business model which persistantly spends more money on bringing "free" features to user while charging very little. Those businesses obviously outcompete any business which do not recieve such investment.
However, as time goes on, those investments must eventually earn a return. Switching from a model which loses money every year to one which must profit every year is invariably going to affect the quality of the product. Especially in an environment where directly charging customers for your service would be a death sentence.
In the absense of such cheap credit, however, a truly competitive environment could potentially emerge, where businesses must be sustanably profitable from the ground up. Esentially this would mean the last 15 or so years has been wasted time in pursuit of this goal, as false monetary signals were steering us in completely the wrong direction.
Some of todays tech companies may survive the transition, but I believe that most will eventually be replaced by completely new ones. Unless we go back to a policy of lowering interest rates to near (or even below) 0%.