[leaveyou]

Consolidation is also favored by cheap money (yes, back to money monopoly thingy). Above some threshold and especially if you are in good relations with a bank, it is far easier to buy your competitors and dismantle them by selling their assets than to compete with them. It's ironic how in the failed communist centralized economies, the economic policy was dictated by "elected" nomenklatura and it was BAD, while in the "free/democratic" market economies the control is held by unaccountable private banks and nobody worries much.

[spindritf]

It's ironic how in the failed communist centralized economies, the economic policy was dictated by "elected" nomenklatura and it was BAD

It wasn't judged as bad because of nomenklatura, or rigged elections. Few people care about these. It was bad because you couldn't get basic goods. There were shortages of sugar and toiler paper. Not war-time shortages, decades after the war.

Which is why the current system will continue as long as it can carry out its basic obligations. American banks are a little behind the times but mostly because of all the backwards compatibility they carry, not scale-related dysfunction. Regular consumers don't feel that. They can still can get their credit cards, chargebacks work, fraud is policed, Amazon gets paid, etc, etc.

[crdoconnor]

There are currently shortages of another basic good: housing.

It's a mistake to think that our economies are any the less planned. Fraud may be policed at the low end, but at the high end (servicer fraud; pension rip offs) it is rife and largely unpoliced.

[spindritf]

Shortage of housing in the US is only local, and it's a feature, not a bug. Voters want a shortage so that they can buy a house in a "good neighbourhood" to move away from poor people. It's almost never explicitly stated that way but that's the way the votes go.

Whole new towns are incorporated around the US to avoid poor school districts. People impose new taxes on themselves, something otherwise unheard of, to do that. Proposition B passed in SF just this month to limit new developments and will probably lead to more limits in the future. Conservative south and urban liberals united at last.

This is the system working as intended, fulfilling the wishes of its constituents.

[crdoconnor]

>Proposition B passed in SF just this month

Preventing the erection of yet more high rise condos will do nothing to solve San Francisco's acute shortage of affordable housing.

Those who care most about affordable housing in SF are, in any case, leaving in droves or have already left.

>This is the system working as intended

Hardly.

[spindritf]

What I meant to say is that voters don't actually want affordable housing because then poor people could move in next door defeating the whole scheme. This is why limiting new developments is system working as intended, as its constituents want it to work.

[leaveyou]

"It was bad because you couldn't get basic goods". True. But the current system is (even more?) problematic because you can't get basic JOBS. And not only that but a fundamental part of the current system is the accelerating race of getting rid of jobs. And not only that but now, unlike ever before, the system uses the best tools against jobs: software & automation.

[brc]

Well, that is just not true. Technological innovation has been automating jobs since, well, the Romans built aqueducts and hydro-power and stopped people having to haul water in buckets up hills and bashing grain with a rock.

There are more people employed now than at any time in history. That's only possible with automation. Even since the time of the Luddites, people have been freed from drudgery and poor jobs and have higher quality of life, despite industry after industry being dissolved.

For each product that is produced at lower cost and higher quality through automation, extra spending is released by the consumers who get to purchase those products at lower cost relative to their income. The extra spending either goes into savings (good) or spending (still good) which in turn creates new industries which create new jobs.

Essentially, you can't have a gaming and micro-brewing industry without the more menial tasks being replaced by automation. I want no part of a future where new innovations can't happen because we insist on slowing technical progress to keep people in menial jobs.

The process has been repeating for a millenia - you have to have a very compelling reason to suggest that it will somehow stop because of more technology.

[leaveyou]

I agree with you on many points. Trying to keep my messages short, I made them too ambiguous. I'm not a Luddite. My only worry is that Thomas Piketty may be right. I don't know where you live, but where I come from, there is a very small percent of shareholders/capital owners/producers and a very large number of consumers/labor owners. The consumers have less and less money and the producers need less and less labor. Are you sure a system like this is stable ? Technology and innovation is great if it works for you and useless if it's someone else's and he has no incentives to share it with you.

[leaveyou]

Personally I specialize in warehouses because with the coming levels of automation, increase of robotic productivity and loss of jobs, there will be so many products and so few customers that only bigger warehouses will be the solution :)

[brc]

It's ironic how in the failed communist centralized economies, the economic policy was dictated by "elected" nomenklatura and it was BAD

It was bad because the only effective way of determining which goods should be produced and which should not is via the price system. It's a fatal conceit of planners that they can predict and determine what people want - even right down to how many loaves of bread they want.

It's the whole reason why some startups fail and others succeed, but nobody really knows why at the outset. Replace the dynamism of Silicon Valley with a government planning board and the whole thing would be dead in 2 years.

The actual idealogy behind it doesn't matter - if you think you can plan an economy, you're already creating trouble.

Control of the economy is most definitely not in the hands of 'unaccountable private banks'. Banks rarely even feature in most startup stories - the market innovated around them by forming venture funds and employing individuals who were skilled at allocating the capital in them. It's simply not true that banks control the economy, and anyone is free to start their own bank or perform their own lending if they like.

[leaveyou]

Again, I agree with you with one exception: banks have an unfair advantage and a monopoly over money creation. With the fractional reserve banking, banks take interest on money they don't have and in partnership with large corporations (in which banks may have vested interests and which are dependent on banks), banks can "determine which products should be produced and which should not" before the market has any word about it (by buying competitors, buying critical suppliers of competitors, patents..). Banks do control and steer the economy more than any other actor.

[leaveyou]

As Arthur Clarke would say: Any sufficiently advanced "bread and circuses" is indistinguishable from freedom and democracy.