Productivity increases bring more economic growth, more wealth, more wage gains and more general prosperity. AI might be just what we need to solve a lot of our current problems.
Certainly better than doomerism but wish it had more connective tissue with our current political / economic meltdown and debt spiral. How we get beyond that to achieve this productivity paradise vision is the problem. How we stop bad actors from using AI at 10x productivity to harm, steal, and cause damage is also a pretty massive hurdle to overcome.
I have been writing essays that pick pieces of the puzzle off one at a time, and the book will pull all of them together. So some of the issues you raise can be found in previous essays. Here's the link to the chronological sequence of stories that is the closest thing to the book before the book comes out in January: https://peterleyden.substack.com/p/the-story-so-far
the essays address other innovations just as pervasive as AI. though AI seems to be viewed negatively more often than the other innovations. Maybe because it is already having noticeable impact.
personally, i'm more concerned about bio engineering...
we've been writing code to automate stuff since the 50's and we eased into it - we were slowed down by the technology and cost. not sure that jacking DNA is going to face the same obstacles and we could get ahead of what is best for us...
but, we have to keep pace with others (China, Russia, Organized Crime) in AI and bio tech or we will find ourselves at the wrong end of the pointy stick.
this competition is what could lead to big missteps in AI and bio tech.
The majority of the changes you note in this and earlier essays were led by FDR. They were controversial times, and he was very controversial leader:
- Broke multiple governing "traditions"
- Shifted much power to the Presidency at a loss to the Congress
- FDR was accused of threatening democracy - including comments by his own party
- Elected president 4 times
- He dramatically increased government control of industry
- Attempted to stack the supreme court
- Dramatically increased the size and expense of the federal government
- He supported isolationism in reaction to Latin America, Germany, Italy, and Japan
- Politicized the justice department by appointing the FBI to investigate business leaders - while ignoring J Edgar Hoover as he ran roughshod over legal and civil rights...
- Was accused of suppressing freedom of speech
- Attempted to "strong arm" his party in elections and was accused of "mudslinging"
- Kept tight, secret diplomatic and military control including talks with the UK and USSR
- Put US military in harms way before entering WW2 by aiding the UK in the Atlantic
- Funded China and embargoed oil to Japan, both angering and threatening Japan
- Agreed to a deal (Yalta) with the Soviets which they broke (and yes he was accused of being naive) in their handling of eastern europe
- Was accused of domestic corruption and government inefficiency
- Led the creation of the United Nations
- Secretly enabled the development of nuclear weapons (which he hid from his VP)
- Surprisingly, he did not support "anti-lynching" legislation
- Did not appoint any Blacks to office
- Interned 100,000+ Japanese-Americans in prison camps
- Allegedly knew of the Holocaust but felt unable to stop it...
it is hard to imagine the "Great Progression" will be less controversial
Yes, I do expect what is coming is going to be very controversial and very disruptive. These junctures always seem to define new rules and norms. You make an interesting list and we are well on our way to doing something similar, though Trump is not the final answer but more like the wrecking ball.
I'm trying to provide some through lines that we should start thinking about - like what we are going to do with the wealth that will be generated. It probably will be very different from what came before....
agreed, trump won't provide the solution. he is seemingly trying to go back to a prior state - though i'm not sure when, maybe the 50's but with civil rights of the 90's.
note that FDR had 4 terms, 16 years, and his party had 75% of the house and senate his first 8 years. 75% - that means very little disputation.
today, when pols gripe about the "other" party" breaking the system, they mean the system the FDR and the DNC put in place when they could not be blocked - except by the supreme court which FDR eventually rewired as well.
we seem to be far from that. the representatives over age 70 (the largest disproportion in government is not race or sex, it is age based) need to become a minority, then the younger people can start the changes you suggest. it will happen.
if the US repeats history, crashing under Hoover, then taking 12 to 16 years to recover under FDR, we are looking at the progression beginning in 2032 and running until 2048 - if the people find the right leader... the people have to be ready for the changes, then they can enable the leader with votes- at least in this nation under this Constitution.
and as bad as times may seem, this is nothing compared to the civil war era. and frankly, at this point, it doesn't compare to the great depression era either.
This feels like wishful thinking, given the trajectory Trump has set. The US is flailing and undercutting its position in the world and its future as a leading nation. The emotional climate within 'America' is ripping the country apart - and the dominant US ethos of unbridled capitalism is unsustainable. Even Christianity is un-Christian in 'America.' Insanity abounds, and civility is sadly lacking. Trump's legacy will last for decades, while the rest of the world moves on. As a society, America never entered adulthood.
That is how many viewed FDR, and Lincoln was loathed... I'm not trying to compare Trump to those two, my point is that "emotional climate" is not much of a indicator.
"America never entered adulthood". you are welcome to have that opinion. it is naive. Maybe Americans never entered adulthood, but the US has been the adult since 1947.
It's not clear if you have read any of my other essays, but I try to address your concerns in several of them about how America is going through a reinvention that is similar to a handful of times in history before that all share an interregnum with characteristics like you mention. This essay here is one that is focused more on the economy and the opportunity opening up. Check out some of the others.
Arthur and Peter, while I understand the appeal of your cyclical theory, history has repeatedly shown that imperial powers rise and fall in a staged sequence. Spain, Portugal, and Britain are now shadows of their former selves. The US is in the financialization stage (manufacturing and product innovation are falling, while the financial industry continues to make money by managing capital. The US has gone from "America First" to "America alone." The rest of the world's economies are moving on - now that the US has become belligerent and unreliable. Furthermore, half of Americans think the other half is immoral. That is not easy to fix. Gentlemen, I am sharing these observations as a Canadian who is sad to witness America's decline, but realistic about the prospects of a turnaround any time soon. I was born in 1947 and witnessed America's rise to global power, based on pragmatic innovation and, at times, brute force. I remain astonished by Americans' inability to see themselves through others' eyes. It is sad to see. I would be pleased if the US could turn itself around. The country voted for Trump (with some vote buying by Musk), so it is America's responsibility to fix itself. I hope you are right about your cycle theory. Best Bill Ratcliffe, PhD, Applied Psychology.
for the record, i'm just a substack "troll". this is Peter's substack and i'm just a reader and commentator. my views are not his and vice versa.
as for the fall of empires, I guess it depends on which theory you ascribe to.
from a geopolitical perspective, the US is far from the kind of decline seen by european nations the past 100 years (though the technologies Peter describes could change that). and as politically divided as the US is, the government still provides advantage over other nations for innovation and commerce. as Peter has noted, the US has reinvented itself at least twice and has all the assets needed to do it a third time. this reinvention is simply being driven by new, unique forces.
the US was one of two global powers that remained standing in 1947. at bretton woods, the US created a global architecture to counter the USSR and the threat it posed to the US - direct access to the Atlantic if the USSR occupied western europe. this resulted in the US:
> getting involved in the middle east (because the UK and France could no longer maintain their control, and Europe needed the oil - the US had plenty for itself).
> getting involved in east asia when france withdrew - to blunt the spread of communism.
> providing the primary defense for Europe (including nuclear weapons and putting US troops at risk) which was effectively subsidizing the economies of every European nation. Nations that created numerous expenses to blunt european consumption of US goods and services - value added tax for example...
> meanwhile, we did the same for Japan and South Korea.
at the same time, the US has used numerous fleets to patrol the world's sea lanes to keep international commerce open - this enabled what people call "globalization" which has lifted huge portions of the world out of abject poverty. in this case the US was subsidizing the entire world.
recently, russia has shown its conventional military is no longer a threat to europe (which collectively has over 200 nuclear weapons), so it is time for europeans to defend themselves and incur the related expenses. it is also a good time for the US to cease the economic advantages the EU created for itself.
US tax payers have funded all these endeavors noted since 1947.
now the US has huge national debt, russia is no longer a threat to the US. and China threatens to gain direct access to the Pacific - which is a strategic risk to the US. so, it is time for the US to realign its unmatched but limited resources (intellectual, economic, innovative, geopolitical, etc.) to counter China.
in re, the US is approaching its fall, what other nation is a threat to supplant the US as the global super power?
while China is the only contender to the US, be aware of China's huge demographic problem the next 40 years. They have more people in their 70's than in their 60's, more 60's than 50's, more 50's than 40's, 40's than 30's, 30's than 20's, and 20's than teens... see the problem?
> what is going to happen to the population - 50% decline or more?
> who is going to innovate?
> who is going to consume?
> what is going to happen to their soon to be numerous, vast empty cities?
> who will populate their military?
it takes 30 to 40 years to reverse such a condition - have babies, raise them, educate them, put them to use. of course, AI could change this. but who knows how?
so, maybe the US will decline compared to its peak (however you judge that), but there is no nation capable of supplanting the US as the super power... unless it is an unforeseen byproduct of AI, biotech, etc.
let's just hope that as the US withdraws from europe, the historically brutal europeans don't revert to their brutal ways and start their 3rd world war without the US there to make them behave.
Best Art Smith, BBA/MBA/MSDA/Grad Cert National Intelligence/7 Professional Certifications, Information Technology, Machine Learning, Project Management, Process Engineering, Innovation (112 patents), F100 Strategy/Foresight
and as someone that lives in America, it isn't being ripped apart. not even in the few cities that are having occasional riots...
most Americans do have financial problems, but those could be managed by not taking international cruises and trips to Disney World, owing 3 or 4 cars, buying 3,000 sqft homes, paying $750 a month for internet/streaming/voice, and eating out for half or more of our meals. circa 1965, we thought life was good when we had one car, that we drove to the park or beach for picnics, lived in a 1,200 sqft home, and ate out 4 or 5 times a year... the "average" american has created their own financial demise... and i'm not counting paying $150,000 for a college degree in a subject (philosophy, music, religion, english, education, etc.) that won't lead to a high paying job...
Arthur, there is much to cover in replying to your thoughtful responses. This kind of dialogue is new to me, and I welcome the opportunity to engage in these debates. As a Canadian, I am pained to witness the current state of affairs of the US on the global stage and within the country itself. I am much less confident that the US will turn itself around any time soon.
Personally, my stake in 'America' includes:
1) My son lives and works in NYC for IRC - he does not have a green card.
2) I have one grandson (2) and a granddaughter on the way.
3) To support our daughter, husband and grandchildren in a multi-generational household in Toronto, my wife and I ploughed our life savings into this property - so we have a stake in the Canadian economy.
4) My wife and I have enjoyed social mobility from poor family farms to professional careers, made possible by government-subsidized university education in Canada. Hard work is in our upbringing and nature.
5) We live and thrive in a socialist culture where we provide a helping hand to those in need who suffer from systemic disadvantages. We do recognize the downsides of chronic social support, but as small 'c' Christians, we follow Christ's fundamental teachings about how we treat the least among us.
That said, I want to respond to your specific claims.
Yes, America played a pivotal role in global leadership post WWII, without question. Now, Trump is abandoning those institutions and violating all the rules that have contributed to the US's success. He is shooting the US in the foot and potentially further up in the body, existentially.
Second, the US Navy used to rule the world, not so much now. Shipbuilding is almost non-existent in the US, and China has stepped into shipbuilding in a big way.
As you have said, the US has a huge government debt, but blaming other countries for this debt shows a distinct lack of self-awareness and a stark lack of interest in cooperating with other nations on common purposes. Tantrums are not a useful way to address mutual challenges. It shows developmental immaturity. Trump is the perfect actor to play this role. Trump never grew up - he always had someone to bail him out. Who is going to bail out the US now that he is playing on the world stage? The rest of the world is moving on. Many countries are investing more in education. The world's leading universities are now outside the US, especially in China.
Yes, the EU has many problems it needs to work out.
Yes, China has an aging population, and it is so racist that immigration is off the table. It is designing, building and using robots to replace workers. It is doing so successfully. Racism is its weakness.
The business ethos in the US is ruthless and predatory. More so in high tech. It is evil, fueled by boys with no liberal arts schooling. Anything for a buck, no matter who gets hurt in the process. It is the wild west all over again. Not to mention the tolerance of monopolies. No wonder the rich get ridiculously richer while the cost of living skyrockets.
Add to this the social ethos of living beyond your means, and you have a script for high personal debt. China has explored this brilliantly. And China has moved on from cheap goods to innovative design (more patents than the US), supply chain integration, robot and AI development, and infrastructure development worldwide. Americans don't know what is happening in China if they listen to American politicians and the media. If you want to know checkout kdwalmsley@substack.com
I wish you well in your support for Progress. We just have different visions for what that will look like. I think we agree that a strong America is a good thing, provided it learns to play well with others. Best wishes, Bill
William, it'd good to have you in the mix. I appreciate your perspective. I'm also married to a Brit and have a lot of European friends and colleagues. Both approaches have merit.
you packed a lot in your brief but flawed statement.
the rest of the world is not going to move on without the US. the rest of the world is about to decline unless it aligns with the US... "deglobalization" will sink the economies of most nations.
european nations have a lot of bad history and bad blood, and they have demographic issues coming as well - lets see how they do when the US realigns with Japan, S Korea, Australia, South America, and hopefully Canada.
India is kind of an unknown, but they have lots of issues with governing, as well as their own regional threats...
Arthur, the US is wrecking globalization; other countries are picking up the slack, leaving the US out of the new agreements. Carney is facilitating these new arrangements. These arrangements are based on win-win cooperation, not threats.
Yes, the US is undoing the welfare it provided to the world for 70 years. other nations do not have the capacity to keep it globalization in place. the US cannot be kept out of the agreements - individual national differences and needs will insure that. perhaps your PhD didn't cover geopolitical analysis...
carney and canada do not have the power. india will play along a bit. brazil a bit. the EU is a group of nations that don't really like each other and that have conflicting needs that override significant cooperation. the EU peaked circa 2010, and is in for a steady decline. france, italy, and germany (core to the eu) have too many geopolitical conflicts... of course, the UK wisely got out of the EU.
the ethos of the US isn't "unbridled capitalism", it is individual liberty. however, the founders knew that there is no individual liberty unless one can accumulate wealth. people often confuse the means with the ends...
this is one of my concerns about UBI. having my sustenance depend on the government taxing others to provide for me, well that is the stuff of "1984"...
Your fear of socialism is showing through. Socialism is not communism. It is about giving others a chance to do well, making more people contributing members of society. Just look at the Nordic countries.
Currently, the US system creates private wealth and public squander. The social ethos makes a joke of 'my fellow Americans.' There are just haves and have-nots, and the not-nots are to blame for their lot in life in America - even the odds of success are stacked against them. That is brutal, not Christian.
I am not religious, by the way. It is the opiate of the masses and relentlessly divisive.
I hold a PhD in Applied Psychology. I worked with Health Canada to de-normalize smoking (social engineering). We have lower rates of smoking in Canada than in the US. I worked briefly out of NYC as the Global Head of Consumer Insights for MediaCom. I programmed an 8-bit Digital computer in the late 60's using Focal RT, and Fortran was my second language for a while. I am a recent convert to Ubuntu to keep my mind active.
you sound like you have been commenting on social media for quite a while, despite you saying you are new at this.
1. You do not know how i feel - your PhD does not give you super powers. I didn't make a statement about socialism. I made a statement about you missing the American ethos - which is individual liberty. You see, while Canada was still happily a British puppet, America broke free from the Monarchy. Americans wanted individual liberty more than Canadians. Earning wealth is simply one aspect of individual liberty. So, If you think I "fear" socialism, go ahead, keep thinking you are right, when you are wrong. I don't fear socialism. I fear government with the power to unreasonably restrict my individual liberty - over my career, 40% of my earnings were taken from me by the government. That is enough. We don't need the government taking more or owning industries (which eliminates privately owned businesses).
2. You just redefined socialism to suit your views. Socialism is when the government owns the means of production. What you describe is more like charity or redistribution of wealth.
3. You use the phrase "the" social ethos as if it is commonly used and understood. One could assume it is tied to the prior sentence which is simply your opinion. Your opinion is not data. I could argue with it, but it would be strictly personal - which is social media's "ethos" - give people a forum to tell others they are wrong...
4. I'll assume your claimed success with smoking is accurate and has proper statistical backing (did you isolate the proper variables? did price or social stigma have an impact? many questions come to mind) - but who cares? Did you include that tidbit to give your viewpoints credibility? Do you want to hear about the hundreds of successes i had in my career? I didn't think so. How does success in one project to reduce smoking overcome you redefining socialism to fit your views? I included all that crap about my education because you ended with your degree - PhD. Do you care that I have 4 university educations and 10 professional certification? Didn't think so. Do you care that I was the strategist, competitive industry analyst, and industry futurist for an F100 company for 20+ years? Didn't think so. A nice CV doesn't correct stupid thoughts, and smart thoughts don't need to be backed by degrees... I don't care that you have a PhD.
5. FYI, in a recent report, that i now wish i had kept, the US was rated lower than all of the Nordic countries in a "free market" report. But since opinion is enough for you, well then, there you go...
6. You share bold comments that are backed by your views, but not data.
7. Your degree gives you no credibility when you are sharing your views beyond the space you studied. And a PhD simply means you learned how to apply the scientific method to that space.
8. The fact that you programmed a computer whether in the 60's or yesterday is irrelevant. Programming, BTW, is entry level to the field of IT which also includes understanding, developing, and deploying operating systems, database management systems, data management, performance and tuning, hardware configuration, infosec, and network management systems. And, there are probably 9. mainstream programming languages alive and well in industry including Assembly, Fortran, COBOL, PL1, C, C++, Java, JavaScript, Python, R, SAS.
PS - you missed a classic social media move. you forgot to correct my spelling and grammar... free social media advice for the noob
PPS - some people in American have a much easier life than others. some people have more skills or intelligence than others. but the biggest factor for success in America for 98% or 99% is their choices and behavior - just my opinion unbacked by data? what percentage of Canadians still smoke despite all your efforts...
PPPS - the US has paid trillions in welfare. Health care is subsidized. University is subsidized. Housing is subsidized. Californians pay $200 billion annually to support the homeless - just in california. 50% of American households do not pay income tax or have 100% of their income tax returned, and some people get more from the IRS than they paid into it… So, quit acting like the US doesn’t try to help the downtrodden…
PPPPS - I organized and operated 25 mission trips in Texas to repair homes for people that could not maintain their own homes. My volunteers reroofed, replaced doors and windows, and refloored over 400 homes at no cost to the owners - so you can get off your little “c” Christian high horse too…
PPPPPS - the opiate of the masses is the idea that government can and will make their lives fair - aka equal, aka equitable
One comment about taxes. When I started in finance in the early 80’s prior to tax rates being lowered, nearly all the talk on the trading desk was about tax shelters. Investing in all sorts of unproductive stuff just to pay less tax. At some point, the Laffer Curve is real
so, what is your point about the laffer curve? why would a professional investor intentionally not make a profit to avoid paying tax? would you rather have $0.00 than 10% of $1.00?
It's not that they werent making a profit - it's that the bulk of the "profit" was in reduced taxes. Essentially they were investing in unproductive things as opposed to what they'd do if they perceived taxes as being fair. I pay most than 50% of my income in tax - not including property, sales, etc. I'd say that's a "fair share"
what do you mean by "unproductive". do you mean not profitable, or not useful in some way.
i also paid 40% in taxes and thought it was a rip off because people making 10x me paid 50%. nothing new, despite what we hear from Pols and see in the press, if taxed the "rich" 100% it wouldn't be close to taxing the "middle class" 30%.
I would find your belief that the billionairs will work toward the redistribution of wealth created by AI if I saw such effort today. All I see is the gap between thousands of workers being laid off, and the gap between the 1% growing larger. It seems similar to the Middle Ages in Western Europe, with the nobility controlling the means of production and wealth, a clergy owned by the nobility, and the peasantry having no access to upward mobility.
There is going to have to be a strong counter-force through politics to push through the changes that will need to be made, for sure. This happened in every other reinvention juncture. But from what I know of my 30 years in Silicon Valley is that there is a big political deal that can be made that the 60 percent majority of tech can live with. The right tech billionaires currently in the limelight with the Trump Administration are going to fight this, but far from all of them. That's what the next few years are going to be all about.
monarchs owing all land and wealth and using labor to enrich themselves, versus business owners offering innovations that consumers (commercial and retail) elect to buy, making the innovators rich...
“If a company was paying a worker $100,000 a year in 2025, they could afford to pay them the equivalent of $267,000 in today’s dollars in 2050.”
Do you not think this is a bit naive? Think about how much more productive a minimum wage worker in America is now vs 2001, they haven’t seen a pay boost even close to this in the same time period.
Also, these tech leaders discussing UBC or UBI are the same tech leaders who all (basically unilaterally at the top level) supported Trump in 2024. Hoping for an about turn here seems like a stretch, surely?
I did another essay that gets to come of this that I link to below. There is a big spit in tech that is misunderstood. So those behind Trump are not the majority. I put it at about 40 percent. Read the story for more.
But you are bringing up a concept that I did not go over in this essay here, but do in the book. The productivity gains get "divided" between profits and wages. In some eras, like after World War II, they were pretty evenly split. But in recent decades they have diverged with more going to profits.
So that thought experiment above is premised on the worker getting their fair share of the productivity gains, though that is not guaranteed.
Eg fast-food worker isn't producing more burgers because they are physically working twice as hard or have acquired an advanced degree; they are producing more because the company invested in better software, scanners, and automated kitchens. As well as the myriad advantages of smart phones and internet.
In economic terms, this is called capital deepening (giving workers better tools). Because the employer paid for the technology that made the worker faster, the employer generally captures the financial gains from that extra speed, rather than passing it down to the worker in the form of higher wages.
See my other comment on this topic. There has been a power imbalance on setting wages in recent decades that has played out in the data. There are many reasons for it, or people debating the reasons. Far fewer unions, more immigrants who will work for less, and just business has more influence on government setting minimum wages.
What I am trying to bring up in this new essay is that with the influx of new wealth coming, we have a chance to reset the balance. I'm trying to get people to think more about how we do this.
it is naive to think a company would pay more because a worker is more effective due to the efforts of the company, capital deepening. the company will pay what they have to pay to hire the talented needed, and no more.
Certainly better than doomerism but wish it had more connective tissue with our current political / economic meltdown and debt spiral. How we get beyond that to achieve this productivity paradise vision is the problem. How we stop bad actors from using AI at 10x productivity to harm, steal, and cause damage is also a pretty massive hurdle to overcome.
Still, one can hope.
I have been writing essays that pick pieces of the puzzle off one at a time, and the book will pull all of them together. So some of the issues you raise can be found in previous essays. Here's the link to the chronological sequence of stories that is the closest thing to the book before the book comes out in January: https://peterleyden.substack.com/p/the-story-so-far
Thank you for the response. I look forward to reading.
RJG,
the essays address other innovations just as pervasive as AI. though AI seems to be viewed negatively more often than the other innovations. Maybe because it is already having noticeable impact.
personally, i'm more concerned about bio engineering...
we've been writing code to automate stuff since the 50's and we eased into it - we were slowed down by the technology and cost. not sure that jacking DNA is going to face the same obstacles and we could get ahead of what is best for us...
but, we have to keep pace with others (China, Russia, Organized Crime) in AI and bio tech or we will find ourselves at the wrong end of the pointy stick.
this competition is what could lead to big missteps in AI and bio tech.
The majority of the changes you note in this and earlier essays were led by FDR. They were controversial times, and he was very controversial leader:
- Broke multiple governing "traditions"
- Shifted much power to the Presidency at a loss to the Congress
- FDR was accused of threatening democracy - including comments by his own party
- Elected president 4 times
- He dramatically increased government control of industry
- Attempted to stack the supreme court
- Dramatically increased the size and expense of the federal government
- He supported isolationism in reaction to Latin America, Germany, Italy, and Japan
- Politicized the justice department by appointing the FBI to investigate business leaders - while ignoring J Edgar Hoover as he ran roughshod over legal and civil rights...
- Was accused of suppressing freedom of speech
- Attempted to "strong arm" his party in elections and was accused of "mudslinging"
- Kept tight, secret diplomatic and military control including talks with the UK and USSR
- Put US military in harms way before entering WW2 by aiding the UK in the Atlantic
- Funded China and embargoed oil to Japan, both angering and threatening Japan
- Agreed to a deal (Yalta) with the Soviets which they broke (and yes he was accused of being naive) in their handling of eastern europe
- Was accused of domestic corruption and government inefficiency
- Led the creation of the United Nations
- Secretly enabled the development of nuclear weapons (which he hid from his VP)
- Surprisingly, he did not support "anti-lynching" legislation
- Did not appoint any Blacks to office
- Interned 100,000+ Japanese-Americans in prison camps
- Allegedly knew of the Holocaust but felt unable to stop it...
it is hard to imagine the "Great Progression" will be less controversial
Yes, I do expect what is coming is going to be very controversial and very disruptive. These junctures always seem to define new rules and norms. You make an interesting list and we are well on our way to doing something similar, though Trump is not the final answer but more like the wrecking ball.
I'm trying to provide some through lines that we should start thinking about - like what we are going to do with the wealth that will be generated. It probably will be very different from what came before....
agreed, trump won't provide the solution. he is seemingly trying to go back to a prior state - though i'm not sure when, maybe the 50's but with civil rights of the 90's.
note that FDR had 4 terms, 16 years, and his party had 75% of the house and senate his first 8 years. 75% - that means very little disputation.
today, when pols gripe about the "other" party" breaking the system, they mean the system the FDR and the DNC put in place when they could not be blocked - except by the supreme court which FDR eventually rewired as well.
we seem to be far from that. the representatives over age 70 (the largest disproportion in government is not race or sex, it is age based) need to become a minority, then the younger people can start the changes you suggest. it will happen.
if the US repeats history, crashing under Hoover, then taking 12 to 16 years to recover under FDR, we are looking at the progression beginning in 2032 and running until 2048 - if the people find the right leader... the people have to be ready for the changes, then they can enable the leader with votes- at least in this nation under this Constitution.
and as bad as times may seem, this is nothing compared to the civil war era. and frankly, at this point, it doesn't compare to the great depression era either.
This feels like wishful thinking, given the trajectory Trump has set. The US is flailing and undercutting its position in the world and its future as a leading nation. The emotional climate within 'America' is ripping the country apart - and the dominant US ethos of unbridled capitalism is unsustainable. Even Christianity is un-Christian in 'America.' Insanity abounds, and civility is sadly lacking. Trump's legacy will last for decades, while the rest of the world moves on. As a society, America never entered adulthood.
That is how many viewed FDR, and Lincoln was loathed... I'm not trying to compare Trump to those two, my point is that "emotional climate" is not much of a indicator.
"America never entered adulthood". you are welcome to have that opinion. it is naive. Maybe Americans never entered adulthood, but the US has been the adult since 1947.
It's not clear if you have read any of my other essays, but I try to address your concerns in several of them about how America is going through a reinvention that is similar to a handful of times in history before that all share an interregnum with characteristics like you mention. This essay here is one that is focused more on the economy and the opportunity opening up. Check out some of the others.
Arthur and Peter, while I understand the appeal of your cyclical theory, history has repeatedly shown that imperial powers rise and fall in a staged sequence. Spain, Portugal, and Britain are now shadows of their former selves. The US is in the financialization stage (manufacturing and product innovation are falling, while the financial industry continues to make money by managing capital. The US has gone from "America First" to "America alone." The rest of the world's economies are moving on - now that the US has become belligerent and unreliable. Furthermore, half of Americans think the other half is immoral. That is not easy to fix. Gentlemen, I am sharing these observations as a Canadian who is sad to witness America's decline, but realistic about the prospects of a turnaround any time soon. I was born in 1947 and witnessed America's rise to global power, based on pragmatic innovation and, at times, brute force. I remain astonished by Americans' inability to see themselves through others' eyes. It is sad to see. I would be pleased if the US could turn itself around. The country voted for Trump (with some vote buying by Musk), so it is America's responsibility to fix itself. I hope you are right about your cycle theory. Best Bill Ratcliffe, PhD, Applied Psychology.
for the record, i'm just a substack "troll". this is Peter's substack and i'm just a reader and commentator. my views are not his and vice versa.
as for the fall of empires, I guess it depends on which theory you ascribe to.
from a geopolitical perspective, the US is far from the kind of decline seen by european nations the past 100 years (though the technologies Peter describes could change that). and as politically divided as the US is, the government still provides advantage over other nations for innovation and commerce. as Peter has noted, the US has reinvented itself at least twice and has all the assets needed to do it a third time. this reinvention is simply being driven by new, unique forces.
the US was one of two global powers that remained standing in 1947. at bretton woods, the US created a global architecture to counter the USSR and the threat it posed to the US - direct access to the Atlantic if the USSR occupied western europe. this resulted in the US:
> getting involved in the middle east (because the UK and France could no longer maintain their control, and Europe needed the oil - the US had plenty for itself).
> getting involved in east asia when france withdrew - to blunt the spread of communism.
> providing the primary defense for Europe (including nuclear weapons and putting US troops at risk) which was effectively subsidizing the economies of every European nation. Nations that created numerous expenses to blunt european consumption of US goods and services - value added tax for example...
> meanwhile, we did the same for Japan and South Korea.
at the same time, the US has used numerous fleets to patrol the world's sea lanes to keep international commerce open - this enabled what people call "globalization" which has lifted huge portions of the world out of abject poverty. in this case the US was subsidizing the entire world.
recently, russia has shown its conventional military is no longer a threat to europe (which collectively has over 200 nuclear weapons), so it is time for europeans to defend themselves and incur the related expenses. it is also a good time for the US to cease the economic advantages the EU created for itself.
US tax payers have funded all these endeavors noted since 1947.
now the US has huge national debt, russia is no longer a threat to the US. and China threatens to gain direct access to the Pacific - which is a strategic risk to the US. so, it is time for the US to realign its unmatched but limited resources (intellectual, economic, innovative, geopolitical, etc.) to counter China.
in re, the US is approaching its fall, what other nation is a threat to supplant the US as the global super power?
while China is the only contender to the US, be aware of China's huge demographic problem the next 40 years. They have more people in their 70's than in their 60's, more 60's than 50's, more 50's than 40's, 40's than 30's, 30's than 20's, and 20's than teens... see the problem?
> what is going to happen to the population - 50% decline or more?
> who is going to innovate?
> who is going to consume?
> what is going to happen to their soon to be numerous, vast empty cities?
> who will populate their military?
it takes 30 to 40 years to reverse such a condition - have babies, raise them, educate them, put them to use. of course, AI could change this. but who knows how?
so, maybe the US will decline compared to its peak (however you judge that), but there is no nation capable of supplanting the US as the super power... unless it is an unforeseen byproduct of AI, biotech, etc.
let's just hope that as the US withdraws from europe, the historically brutal europeans don't revert to their brutal ways and start their 3rd world war without the US there to make them behave.
Best Art Smith, BBA/MBA/MSDA/Grad Cert National Intelligence/7 Professional Certifications, Information Technology, Machine Learning, Project Management, Process Engineering, Innovation (112 patents), F100 Strategy/Foresight
Author, that comment was an essay in itself. I mostly agree with it though would frame it differently and dispute some. But it gets people thinking.
ha ha, thank you
and as someone that lives in America, it isn't being ripped apart. not even in the few cities that are having occasional riots...
most Americans do have financial problems, but those could be managed by not taking international cruises and trips to Disney World, owing 3 or 4 cars, buying 3,000 sqft homes, paying $750 a month for internet/streaming/voice, and eating out for half or more of our meals. circa 1965, we thought life was good when we had one car, that we drove to the park or beach for picnics, lived in a 1,200 sqft home, and ate out 4 or 5 times a year... the "average" american has created their own financial demise... and i'm not counting paying $150,000 for a college degree in a subject (philosophy, music, religion, english, education, etc.) that won't lead to a high paying job...
Arthur, there is much to cover in replying to your thoughtful responses. This kind of dialogue is new to me, and I welcome the opportunity to engage in these debates. As a Canadian, I am pained to witness the current state of affairs of the US on the global stage and within the country itself. I am much less confident that the US will turn itself around any time soon.
Personally, my stake in 'America' includes:
1) My son lives and works in NYC for IRC - he does not have a green card.
2) I have one grandson (2) and a granddaughter on the way.
3) To support our daughter, husband and grandchildren in a multi-generational household in Toronto, my wife and I ploughed our life savings into this property - so we have a stake in the Canadian economy.
4) My wife and I have enjoyed social mobility from poor family farms to professional careers, made possible by government-subsidized university education in Canada. Hard work is in our upbringing and nature.
5) We live and thrive in a socialist culture where we provide a helping hand to those in need who suffer from systemic disadvantages. We do recognize the downsides of chronic social support, but as small 'c' Christians, we follow Christ's fundamental teachings about how we treat the least among us.
That said, I want to respond to your specific claims.
Yes, America played a pivotal role in global leadership post WWII, without question. Now, Trump is abandoning those institutions and violating all the rules that have contributed to the US's success. He is shooting the US in the foot and potentially further up in the body, existentially.
Second, the US Navy used to rule the world, not so much now. Shipbuilding is almost non-existent in the US, and China has stepped into shipbuilding in a big way.
As you have said, the US has a huge government debt, but blaming other countries for this debt shows a distinct lack of self-awareness and a stark lack of interest in cooperating with other nations on common purposes. Tantrums are not a useful way to address mutual challenges. It shows developmental immaturity. Trump is the perfect actor to play this role. Trump never grew up - he always had someone to bail him out. Who is going to bail out the US now that he is playing on the world stage? The rest of the world is moving on. Many countries are investing more in education. The world's leading universities are now outside the US, especially in China.
Yes, the EU has many problems it needs to work out.
Yes, China has an aging population, and it is so racist that immigration is off the table. It is designing, building and using robots to replace workers. It is doing so successfully. Racism is its weakness.
The business ethos in the US is ruthless and predatory. More so in high tech. It is evil, fueled by boys with no liberal arts schooling. Anything for a buck, no matter who gets hurt in the process. It is the wild west all over again. Not to mention the tolerance of monopolies. No wonder the rich get ridiculously richer while the cost of living skyrockets.
Add to this the social ethos of living beyond your means, and you have a script for high personal debt. China has explored this brilliantly. And China has moved on from cheap goods to innovative design (more patents than the US), supply chain integration, robot and AI development, and infrastructure development worldwide. Americans don't know what is happening in China if they listen to American politicians and the media. If you want to know checkout kdwalmsley@substack.com
you have so many views/assumptions that i disagree with that there is no point in replying. i hope things work out for you and your family.
I wish you well in your support for Progress. We just have different visions for what that will look like. I think we agree that a strong America is a good thing, provided it learns to play well with others. Best wishes, Bill
William, it'd good to have you in the mix. I appreciate your perspective. I'm also married to a Brit and have a lot of European friends and colleagues. Both approaches have merit.
this has been fun
you packed a lot in your brief but flawed statement.
the rest of the world is not going to move on without the US. the rest of the world is about to decline unless it aligns with the US... "deglobalization" will sink the economies of most nations.
european nations have a lot of bad history and bad blood, and they have demographic issues coming as well - lets see how they do when the US realigns with Japan, S Korea, Australia, South America, and hopefully Canada.
India is kind of an unknown, but they have lots of issues with governing, as well as their own regional threats...
Arthur, the US is wrecking globalization; other countries are picking up the slack, leaving the US out of the new agreements. Carney is facilitating these new arrangements. These arrangements are based on win-win cooperation, not threats.
Yes, the US is undoing the welfare it provided to the world for 70 years. other nations do not have the capacity to keep it globalization in place. the US cannot be kept out of the agreements - individual national differences and needs will insure that. perhaps your PhD didn't cover geopolitical analysis...
carney and canada do not have the power. india will play along a bit. brazil a bit. the EU is a group of nations that don't really like each other and that have conflicting needs that override significant cooperation. the EU peaked circa 2010, and is in for a steady decline. france, italy, and germany (core to the eu) have too many geopolitical conflicts... of course, the UK wisely got out of the EU.
the ethos of the US isn't "unbridled capitalism", it is individual liberty. however, the founders knew that there is no individual liberty unless one can accumulate wealth. people often confuse the means with the ends...
this is one of my concerns about UBI. having my sustenance depend on the government taxing others to provide for me, well that is the stuff of "1984"...
Your fear of socialism is showing through. Socialism is not communism. It is about giving others a chance to do well, making more people contributing members of society. Just look at the Nordic countries.
Currently, the US system creates private wealth and public squander. The social ethos makes a joke of 'my fellow Americans.' There are just haves and have-nots, and the not-nots are to blame for their lot in life in America - even the odds of success are stacked against them. That is brutal, not Christian.
I am not religious, by the way. It is the opiate of the masses and relentlessly divisive.
I hold a PhD in Applied Psychology. I worked with Health Canada to de-normalize smoking (social engineering). We have lower rates of smoking in Canada than in the US. I worked briefly out of NYC as the Global Head of Consumer Insights for MediaCom. I programmed an 8-bit Digital computer in the late 60's using Focal RT, and Fortran was my second language for a while. I am a recent convert to Ubuntu to keep my mind active.
Congrats on your patents! You are innovative.
you sound like you have been commenting on social media for quite a while, despite you saying you are new at this.
1. You do not know how i feel - your PhD does not give you super powers. I didn't make a statement about socialism. I made a statement about you missing the American ethos - which is individual liberty. You see, while Canada was still happily a British puppet, America broke free from the Monarchy. Americans wanted individual liberty more than Canadians. Earning wealth is simply one aspect of individual liberty. So, If you think I "fear" socialism, go ahead, keep thinking you are right, when you are wrong. I don't fear socialism. I fear government with the power to unreasonably restrict my individual liberty - over my career, 40% of my earnings were taken from me by the government. That is enough. We don't need the government taking more or owning industries (which eliminates privately owned businesses).
2. You just redefined socialism to suit your views. Socialism is when the government owns the means of production. What you describe is more like charity or redistribution of wealth.
3. You use the phrase "the" social ethos as if it is commonly used and understood. One could assume it is tied to the prior sentence which is simply your opinion. Your opinion is not data. I could argue with it, but it would be strictly personal - which is social media's "ethos" - give people a forum to tell others they are wrong...
4. I'll assume your claimed success with smoking is accurate and has proper statistical backing (did you isolate the proper variables? did price or social stigma have an impact? many questions come to mind) - but who cares? Did you include that tidbit to give your viewpoints credibility? Do you want to hear about the hundreds of successes i had in my career? I didn't think so. How does success in one project to reduce smoking overcome you redefining socialism to fit your views? I included all that crap about my education because you ended with your degree - PhD. Do you care that I have 4 university educations and 10 professional certification? Didn't think so. Do you care that I was the strategist, competitive industry analyst, and industry futurist for an F100 company for 20+ years? Didn't think so. A nice CV doesn't correct stupid thoughts, and smart thoughts don't need to be backed by degrees... I don't care that you have a PhD.
5. FYI, in a recent report, that i now wish i had kept, the US was rated lower than all of the Nordic countries in a "free market" report. But since opinion is enough for you, well then, there you go...
6. You share bold comments that are backed by your views, but not data.
7. Your degree gives you no credibility when you are sharing your views beyond the space you studied. And a PhD simply means you learned how to apply the scientific method to that space.
8. The fact that you programmed a computer whether in the 60's or yesterday is irrelevant. Programming, BTW, is entry level to the field of IT which also includes understanding, developing, and deploying operating systems, database management systems, data management, performance and tuning, hardware configuration, infosec, and network management systems. And, there are probably 9. mainstream programming languages alive and well in industry including Assembly, Fortran, COBOL, PL1, C, C++, Java, JavaScript, Python, R, SAS.
PS - you missed a classic social media move. you forgot to correct my spelling and grammar... free social media advice for the noob
PPS - some people in American have a much easier life than others. some people have more skills or intelligence than others. but the biggest factor for success in America for 98% or 99% is their choices and behavior - just my opinion unbacked by data? what percentage of Canadians still smoke despite all your efforts...
PPPS - the US has paid trillions in welfare. Health care is subsidized. University is subsidized. Housing is subsidized. Californians pay $200 billion annually to support the homeless - just in california. 50% of American households do not pay income tax or have 100% of their income tax returned, and some people get more from the IRS than they paid into it… So, quit acting like the US doesn’t try to help the downtrodden…
PPPPS - I organized and operated 25 mission trips in Texas to repair homes for people that could not maintain their own homes. My volunteers reroofed, replaced doors and windows, and refloored over 400 homes at no cost to the owners - so you can get off your little “c” Christian high horse too…
PPPPPS - the opiate of the masses is the idea that government can and will make their lives fair - aka equal, aka equitable
One comment about taxes. When I started in finance in the early 80’s prior to tax rates being lowered, nearly all the talk on the trading desk was about tax shelters. Investing in all sorts of unproductive stuff just to pay less tax. At some point, the Laffer Curve is real
so, what is your point about the laffer curve? why would a professional investor intentionally not make a profit to avoid paying tax? would you rather have $0.00 than 10% of $1.00?
i'm not getting your point...
It's not that they werent making a profit - it's that the bulk of the "profit" was in reduced taxes. Essentially they were investing in unproductive things as opposed to what they'd do if they perceived taxes as being fair. I pay most than 50% of my income in tax - not including property, sales, etc. I'd say that's a "fair share"
what do you mean by "unproductive". do you mean not profitable, or not useful in some way.
i also paid 40% in taxes and thought it was a rip off because people making 10x me paid 50%. nothing new, despite what we hear from Pols and see in the press, if taxed the "rich" 100% it wouldn't be close to taxing the "middle class" 30%.
but, please explain "unproductive"...
I would find your belief that the billionairs will work toward the redistribution of wealth created by AI if I saw such effort today. All I see is the gap between thousands of workers being laid off, and the gap between the 1% growing larger. It seems similar to the Middle Ages in Western Europe, with the nobility controlling the means of production and wealth, a clergy owned by the nobility, and the peasantry having no access to upward mobility.
There is going to have to be a strong counter-force through politics to push through the changes that will need to be made, for sure. This happened in every other reinvention juncture. But from what I know of my 30 years in Silicon Valley is that there is a big political deal that can be made that the 60 percent majority of tech can live with. The right tech billionaires currently in the limelight with the Trump Administration are going to fight this, but far from all of them. That's what the next few years are going to be all about.
not similar at all.
monarchs owing all land and wealth and using labor to enrich themselves, versus business owners offering innovations that consumers (commercial and retail) elect to buy, making the innovators rich...
“If a company was paying a worker $100,000 a year in 2025, they could afford to pay them the equivalent of $267,000 in today’s dollars in 2050.”
Do you not think this is a bit naive? Think about how much more productive a minimum wage worker in America is now vs 2001, they haven’t seen a pay boost even close to this in the same time period.
Also, these tech leaders discussing UBC or UBI are the same tech leaders who all (basically unilaterally at the top level) supported Trump in 2024. Hoping for an about turn here seems like a stretch, surely?
I did another essay that gets to come of this that I link to below. There is a big spit in tech that is misunderstood. So those behind Trump are not the majority. I put it at about 40 percent. Read the story for more.
But you are bringing up a concept that I did not go over in this essay here, but do in the book. The productivity gains get "divided" between profits and wages. In some eras, like after World War II, they were pretty evenly split. But in recent decades they have diverged with more going to profits.
So that thought experiment above is premised on the worker getting their fair share of the productivity gains, though that is not guaranteed.
What data supports the idea that minimum wage workers are "much more productive".
Eg fast-food worker isn't producing more burgers because they are physically working twice as hard or have acquired an advanced degree; they are producing more because the company invested in better software, scanners, and automated kitchens. As well as the myriad advantages of smart phones and internet.
In economic terms, this is called capital deepening (giving workers better tools). Because the employer paid for the technology that made the worker faster, the employer generally captures the financial gains from that extra speed, rather than passing it down to the worker in the form of higher wages.
If you want data you will have to google it.
See my other comment on this topic. There has been a power imbalance on setting wages in recent decades that has played out in the data. There are many reasons for it, or people debating the reasons. Far fewer unions, more immigrants who will work for less, and just business has more influence on government setting minimum wages.
What I am trying to bring up in this new essay is that with the influx of new wealth coming, we have a chance to reset the balance. I'm trying to get people to think more about how we do this.
it is naive to think a company would pay more because a worker is more effective due to the efforts of the company, capital deepening. the company will pay what they have to pay to hire the talented needed, and no more.