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HB

I had a similar vague perception in my mind so thanks a lot for presenting it more quantitatively.


"An advanced country, of course, cannot grow at the same speed as a country starting from a lower base,..."

To be more exact this may be a general trend but it's far from universally true. Were that the case there would not be prosperity disparities between countries. As soon as a country got significantly ahead, its growth rate would slow down and the rest of the world would catch up. The current great disparities exist exactly because some countries maintain above world average growth rates in spite of having already launched ahead. This is actually what happened in the US in the nineteenth and twentieth centuries. The US maintained a growth rate higher than average in spite of already having achieved "developed" status in those eras, Hence the huge prosperity disparity between the US and most of the world. This growth leadership seems to have subsided in the US, hence our prosperity leadership is currently eroding, albeit slowly, while Europe's prosperity leadership is eroding fast. At this rate most of Western Europe will classify as middle income countries by mid century.

In my view countries with big governments , bureaucracy/regulation, and lots of interventionism and redistribution, inevitably create flatter effort/reward curves, thus less motivated citizens, thus slower growth. That is why the US growth rate has slowed down. Because for a near majority of Americans Europe has become their model continent to imitate.

By mid century average per capita income will have reached the much slow growing European levels. If that is the fate awaiting the US then the best personal skill to master at this point is mobility and emigration. Seems unthinkable, but as the ATOM moves along great tectonic changes will happen ever faster and the unthinkable may arrive within just a few decades. People need to get used to a faster and ever accelerating pace. It is likely that, just like the space traveller is torn apart approaching the black hole, most voter-lemmings will be shred apart by the approaching singularity.

Kartik Gada

HB,

I corrected the article. Obviously, the correlation between a low base and growth rate is not that high. Only in Asia are countries consistently growing quickly.

Africa has little to no per capita growth, while Singapore continues to grow rapidly despite being more prosperous than the US.

HB

Yes, I agree that there is a correlation. I think its primarily the advantage a less developed country may have in being able to see and copy the trajectories of developed countries that have travelled that road, even though many of these once faster than world average growing countries have now become bad models with severely subpar growth rates (e.g. Europe).

I'm also reluctant to attribute the growth disparities to the interventionist practice of inflating the money supply. Great growth disparities existed in the world well before there was any technological deflation.

I have voiced my objection in the past about the practice of addressing technological deflation through money printing, so I'd rather avoid much repetition here. In short, my view is that the money printing practice remains essentially redistributive, something that effectively flattens the effort/reward curve and thus leads to lower growth, compared to a less interventionist approach. I see no reason to jettison all current economic thinking just to keep the current economic idea that deflation is necessarily bad. Let deflation be -- so that the benefits of accelerating technology do benefit those who contribute to it, in an unfettered meritocratic manner. Printing money to essentially redistribute part of the ATOM benefit is essentially redistribution, a socialism for the ATOM era of sorts, which will stifle incentives and thus growth compared to what it would have otherwise been.

I think that the reason China has developed so fast is exactly that China has, in the last three decades, moved a lot towards a less interventionist economic approach, with effort/reward curves that are closer to those of a free market capitalist economy. It has by no means reached free market capitalism status. However it went from a completely planned, zero freedom, virtually flat effort/reward curve economy to moderate levels of freedom. Moderate levels of freedom correspond to moderate per capita prosperity, a prosperity level where China is still some distance from, hence it is growing fast towards its new equilibrium point, the middle per capita prosperity point.

So the question is what will happen to China when it reaches that equilibrium point whereby middle economic freedom begets middle per capita income prosperity. My guess is that its growth will slow down unless it moves towards a freer and smaller government regime, something quite challenging with an entrenched communist state. That being said, Asian cultures are better at swallowing their pride and copying more successful systems, so China may yet free its economy beyond my expectations.

In many ways, China has gone from a communist economy with virtually zero economic freedom, and thus near zero incentives, to a fascist economy where meritocracy is at least somewhat respected, albeit in the reduced crony fashion that meritocracy is inevitably compromised in a fascist totalitarian regime. If China continues to liberalize its economy then its per capita income will continue growing at a fast pace, and by mid century it will have reached the per capita prosperity of the dismal growth European big welfare government states. China will then reach American per capita income levels rather soon after that, perhaps after another two decades, by year 2070 or so.

Of course, as everything human is now moving very fast, and accelerating to breakneck velocities, disruptions and trajectories may differ quite a bit from my more steady state predictions -- especially when we are talking about long time horizons of half a century. Most countries will likely see dramatic changes that we currently regard as unthinkable-- some countries for the better, some for the worse-- with the underlying ATOM supporting an overall very positive outlook -- on average.

In addition, as growth rates are accelerating worldwide, the divergences in prosperity will also magnify in my view. My personal advice to people is to stay mobile, so that they can geo-arbitrage different decisions that different countries will make. The western world outlook does not look too good right now. The voter-lemmings of the western world have voted themselves too much redistribution, too much regulation, and too big of a government. More specifically, the voter-lemmings of Europe, their big welfare states, and their flatter effort/reward curves have a pretty dismal outlook going forward. So does the US if that is the continent a majority of Americans seem poised to follow. So do indeed stay mobile! Things we thought unthinkable may be just a couple of decades, or a couple of years, away.

In my view India's underperformance relative to China is due to the fact that India remains stuck in the strongly interventionist hippie-socialist principles of the Gandhi era. I'm sure that people more familiar with the country have more opinions on the details, but that is my general assessment.

With growth rates below average world growth rates nothing is sustainable -- nothing! Economic decline sucks everything down with it. No country with a growth rate below world average will survive for long.

Kartik Gada

HB,

I'm also reluctant to attribute the growth disparities to the interventionist practice of inflating the money supply.

That is not what it is. It is merely the progression of technological economics to the next stage. Once could express similar consternation about how companies see their market cap rise on the basis of estimated earnings that may be 5, 10, or even 15 years away. This is a progression of a similar nature and magnitude.

Of course, as everything human is now moving very fast, and accelerating to breakneck velocities, disruptions and trajectories may differ quite a bit from my more steady state predictions -- especially when we are talking about long time horizons of half a century. Most countries will likely see dramatic changes that we currently regard as unthinkable-- some countries for the better, some for the worse-- with the underlying ATOM supporting an overall very positive outlook -- on average.

The thing is, China understands parts of this. Technology really is 'winner take all', and China is willing to devote money printing to the goal of outcompeting Silicon Valley. Silicon Valley could see its dominance reverse faster than they expect.

Economic decline sucks everything down with it. No country with a growth rate below world average will survive for long.

Europe's stagnation is more ominous than they realize. They are falling behind at a rapid pace. In 2007, the UK was still 2.5x the size of India, but now they are equal. That the UK was almost as big as China as recently as 2007 seems incredible today, with China now 4x larger.

TOM SCHILLER

In 2016, you talked about the factors that would lead to the next major financial crisis.

http://www.singularity2050.com/2016/07/the-2017-crisis.html

Are you going to revisit this topic soon and update your predictions based on everything that happened in 2017 (Trump presidency, tax cuts, trade wars, etc.)

Kartik Gada

Tom Schiller,

Yes, at some point I will. We are clearly not in a recession yet, but at the same time, the ^vix is definitely behaving like a pre-recession, and has been since the end of 2017.

Two other factors.
i) Trump was a total surprise. The entire economy was teetering until the election result surprise (which could either be interpreted as pro-Trump or merely 'thank god we don't have Hillary).
ii) China and Japan have figured out these economics much better than the US has, which, as I wrote, is the way that the crisis can be avoided. China and Japan QE is propping up the entire world, and is even compensating for the US's wrongheaded interest-rate hikes and balance-sheet unwinding.

HB

Kartik,

Talking about Europe...

I am from Europe, have grown up and lived there, and I can assure you that virtually nobody on that continent realizes how quickly the continent is sliding in prosperity rankings -- and what the arithmetically inevitable result is.

Whether out of ignorance or desperation, Europe is doubling down on its self righteous goals of a flatter effort reward curve. The few (very few) who dare point out the dismal European no-growth rates -- and thus its deterministic trajectory towards decline and irrelevance -- are quickly silenced with hollow cliches; "people above profits" and the like.

At current trendlines average world per capita income surpasses European levels by 2060. And that is just at current trendlines, completely ignoring the ATOM effects whereby economic growth is not only exponential but the exponent itself is rising. Few people realize how exceptional world growth trendline has been in the last three decades, now hovering at around four percent. Never in human history has there been such growth. And, of course, as I said, this completely ignores the ATOM whereby the growth rate itself will explode.

Even at current trendlines, completely ignoring ATOM for a second, worldwide per capita income rises from $13,000 today to around $500,000 by the end of the century (mind you inflation adjusted, nominal will be even higher), yet most of the world, and especially Europe, pretends to be worried about an additional half degree rise in global temperatures. The epitome of pathetic.

If you are in a 1-2% growth trendline country, you will be economically extinct well before global warming adds another degree of temperature.

Europeans have their head in the sand as to how quickly the rising world average will submerge them into irrelevance.

Kartik Gada

HB,

Perhaps you can tell me about something I have wondered for a while.

We know why the Eurozone is stagnant, but why isn't Eastern Europe growing fast enough to achieve parity with Western Europe? With the possible exception of Poland and a couple of the small Baltic states, Eastern Europe appears to be stuck in middle-income status with moribund growth rates. This includes Russia, which has vast natural resource wealth and intelligent people.

China is almost up to full parity with EE + Russia, and India today is where this Bloc was in 2002, but is growing at twice the rate as the Bloc did from 2002-present.

Kartik Gada

HB,

Few people realize how exceptional world growth trendline has been in the last three decades, now hovering at around four percent. Never in human history has there been such growth.

Not merely few, but almost none. There are less than five people (including me) that have written anything substantive about this subject in the last 10 years. When I Google something as broad as 'Exponential Economic Growth', I see my own charts!

There is no subject that affects more people yet has so little written about it. If more were aware, then much more enlightened economic and governance policies could be enacted.

Among the many details worthy of consideration :

i) GDP will become increasingly inadequate to measure this exponential trend, as GDP rewards doing 'more with more', rather than the 'same with less', while most technology is about the latter. This is explored in Chapter 2 of the ATOM.
ii) The 'years' gradient. Since Nominal GDP converges up to PPP as a country matures, we can see how even poor countries, if fast-growing, are not very far behind, in calendar years, from seemingly much more prosperous countries/regions.

For example, India is where EE (as an aggregation) was in 2002. India is where Latin America was in 1998. But each of these regions only grew at 3-4% after this stage, vs. India's current 7.5%. Hence, despite India's deep poverty to this day, true liberation is not very far in years at all, provided it can grow at the current rate or even just stay above 6%.

Similarly, China is where South Korea was in 1998, and is growing faster than South Korea did from that point. Mexico is where France was in 1980, but Mexico is not growing very fast.

fatcat


>Few people realize how exceptional world growth trendline has been in the last three decades, now hovering at around four percent. Never in human history has there been such growth.

Not merely few, but almost none. There are less than five people (including me) that have written anything substantive about this subject in the last 10 years. When I Google something as broad as 'Exponential Economic Growth', I see my own charts!

[off] First some off-topic. It is normal to have few internet posts on obscure topics. I remember researching a topic and finding related posts that I happened to post a few years earlier; they just got repackaged by content scrubbers. Ironically, I didn’t recognize them as mine for a few minutes. [/off]
There are many people recognizing that the last few decades, or even the last 200 years are quite uniquely unprecedented in the human history, however most of them assume that we will revert to slow or almost no growth. So, the exponential growth we have witnessed for them is just aberration that will soon be erased by the “normal” trend.
The question is how “soon” if the exponential phase fizzles in a few decades, we could be well after many doublings. If it stops after only 10 doublings it would be already thousand times more than today.
In fact, many writers will assume we are addicted to growth. The budgets are relying already on future growth. And even planners are hoping on exponential growth. All private pension funds assume unrelentless growth of the portfolio valuations. It just happens that nobody cares about the big picture and there is an implied assumption that the growth will “normalize” or slow-down in the future. Since there is a slow-down in the OECED world this notion looks convincing.

After all there are always physical limits. We cannot double our energy use indefinitely even with the cleanest technologies. At some point we will have so much waste heat that we will be boiling the planet. If we go off-world we can have a couple of hundred years until consuming the solar system. Then we will be limited by the speed of light. If we manage to avoid the speed of light limit in 30-60 doublings we could consume the whole known universe. So, there are limits. But we are not there yet.


Now assessing what are the physical limits to the economic growth is a different topic

Kartik Gada

fatcat,

however most of them assume that we will revert to slow or almost no growth.

This is where they are wrong. This trend has never, ever broken, and there is no evidence that it will.

What is more likely is that the exponential improvement decouples from a) GDP, and b) humanity entirely. The real exponential trend might be 'computational density' or 'intelligence density'.

We cannot double our energy use indefinitely even with the cleanest technologies. At some point we will have so much waste heat that we will be boiling the planet. If we go off-world we can have a couple of hundred years until consuming the solar system.

Again, humans will almost certainly not be the ones that colonize space. AI requires neither air nor water, and can survive a much wider band of temperature, pressure, gravity, and radiation than a human can.

The energy question is quite Malthusian, and the same mitigations through efficiency will emerge yet again, even if that means humans themselves are demoted. If an AI that is more suitable for space exploration is launched, its energy usage (both direct and indirect) might be millions or even billions of times lower than a spaceship carrying humans.


fatcat

Hi Kartik,
>What is more likely is that the exponential improvement decouples from a) GDP, and b) humanity entirely. The real exponential trend might be 'computational density' or 'intelligence density'.

We are going into uncharted territory here. Probably the best illustration would be Charles Stross' Accelerando (https://en.wikipedia.org/wiki/Accelerando)

On onehand it is too fantastic to consider. On another, if the acceleration trend contentious and accelerates, we have only a few decades before reaching similar scenarios. Probably the next couple of decades would be the most turbulent. After that we will either adapt or die miserably...

Geoman

Accelerando! I loved that book Fatcat. Nice to find another fan.

And i agree with the rest of you post. One effect of the singularity, even approaching the singularity, is that our measurement tools become distorted, and that inexplicable things start to occur. Time is compressed. The rules of economics start to crack.

I find our current economic situation fascinating - just a couple of years ago trump was laughed at for proposing 3-4% growth rates in the U.S. Now we are there. But how did we get there? What did he do? He simply lowered, slightly, the absurd corporate tax rates, especially taxes on importing profits. Cut some regulations. What is remarkable is how unremarkable his changes were. And those changes got us an extra 1% growth. $200 billion extra in growth each year, compounded. And what did we give up in exchange? Hardly anything. Its astonishing how easy it was to pick up a full point of extra growth.

I feel Europe is in the same position - really some minor changes to the tax structure and regulations would correct most of the imbalances and greatly increase growth rates. And growth feeds on itself, so growth in one country will drag the others up.

What is astonishing about it all is we know HOW to make an economy grow very rapidly. There is a stunningly good correlation between economic freedom indices and growth rates. Anything above an indices of 7 seems to be "good enough" to spur rapid growth. What we need to do is start pressuring countries - why are you not implementing programs we know work, and rapidly increaseing the wealth of your citizens? What possible excuse do they have not to do it? It is not remotely theoretical - we KNOW it works.

I see a lot of hope and potential in Africa. I think Ethiopia has turned a corner (8.5% growth), as well as Kenya (5%). Tanzania. Uganda. A whole east Africa strip that is experiencing real growth. There are some surprising bright spots.

And Poland grew 3.8% last year, which is not too shabby. Romania 5.5%. Bulgaria 3.6%. Versus France - 1.6%. the UK 2%. Denmark 1.9%. Germany 2.1%. So Eastern Europe is at leas a full point of growth ahead of western Europe, along with the U.S.

Again - we know what works. What excuse does France have for not growing at at least 3%? There are 192 countries, 106 are above 3% growth last year. That leaves 86 countries at sub-par growth. Imagine those countries jumping up above 3%. What a difference that would make.

And heck, India posted 7.5% real GDP growth last year, which is pretty damn good.

Kartik Gada

Geoman,

I believe the current burst is just due to the surprise election result (whether pro-Trump or merely relief at Hillary not coming in). It mirrors the big downward shift we saw in August 2008 when Obama's win become inevitable, and the removal of the same force worked favorably this time.

But whether the 1% growth increase is just a one-time surge, or sustained in subsequent years, remains to be seen. Remember that the US is unwinding QE, which will be very bad unless China keeps doing enough to offset.

What is astonishing about it all is we know HOW to make an economy grow very rapidly. There is a stunningly good correlation between economic freedom indices and growth rates

I hope Artificial Intelligence is used in the policy sphere more. When the most suitable course of action is presented without bias or ideological blinkers, then it is harder for them to avoid these obvious prescriptions.

What is remarkable is how unremarkable his changes were.

But if we see that a few small changes enables a significant improvement, that just shows how constrained the economy is (we know that we are behind the long-term trendline). ATOM-DUES is precisely what is needed, as we really could get to 15%+ growth by 2033 under that. Almost every material scarcity of today will be gone (of course, new ones will be invented). Imagine the surge through having *no* income tax.

HB

Fatcat,

I'm familiar with the limits to growth thinking. However a disruptor is exactly that -- something that disrupts normal logical thinking -- something we cannot quite imagine, something beyond our current horizon, something beyond our deductive reasoning -- and there are many disruptors ahead. Actually, the trendline shows an increasing frequency of disruptors.

More practically, global engineering of a slower growth world is probably the most damaging thing we can do to ourselves, and our descendants. Therefore thanks, but no thanks, no slow growth activism for me. Problem is that typically the slow growth activists want the global imposition of this growth slowdown ideology. An ideology that claims to have predicted not only current scientific things, like e.g. the climatological trajectory of the planet, but also the human trajectory, and have thus come to the prediction that humanity will suffer because of growth several decades into the future. The human trajectory part of this prediction is of such speculative magnitude that I classify slow-growth activism as a religion rather than a science. My issue here obviously is that I will resist imposition of that religion on a global scale.

Imagine someone in the early eighteenth century, when all the laws of classical physics of energy conservation and transformation were already more or less known, making the (correct) statement: "The maximum energy output of a human is about half a horsepower and his minimum weight about one hundred pounds. Based on this ratio the fundamental laws of physics make human flight impossible. Therefore humans will never fly", which is BTW a statement that is correct, and remains correct to this day. This statement could have been made by a very smart person of the time, perhaps someone much much smarter than I, and the statement would have been correct. However, what this very intelligent and excellent at calculations and scientific thought person could not think is that humans will not fly on their own. They will invent something called "a machine", and then they will fly on the machine. But the machine, in an era where only living things produce energy is something outside our early eighteenth century scientist's imagination, no matter how smart and erudite he is. He cannot think of a machine (otherwise his scientific and logical mind would immediately recognize its tremendous potential and start working on it). He cannot think of machine and thus even less so of a machine evolving into a machine that flies, and even carries a human, what we call today an airplane. That is what a disruptor is. Something beyond the thinking horizon of even the smartest people.

This is like saying today, as Kartik aptly speculates, that humans may not expand into human form, but perhaps into some other form. Who knows? Perhaps ...let me think of something seemingly crazy... they will find out that what we were referring to as metaphysical phenomena and religions all along were clues to a different world, beyond our imagination, which is after all subject to scientific analysis and exploitation, or perhaps a different kind of thinking that is completely different than current thinking, or not ...like the relativity of time was once thought crazy and metaphysical. Of course I'm making up this example as something crazy, just to point out what disruptive thought is about. Well if not this crazy thing then what? Don't ask me specifics. Don't ask me about how when or where. I do not know. It is beyond the imagination horizon of people much more intelligent than I am. All I see is the trendline on the graph -- which points out to the ever more frequent occurrence of disruptors. Might it stop? Might it flatten out? I think it's unlikely though the probability is not zero. But most importantly and practically I think that a global coercive effort to try to slow it down (e.g. the "sustainability activism" religion) is one of the greatest disservices we can do to our future.

Kartik Gada

HB,

But most importantly and practically I think that a global coercive effort to try to slow it down (e.g. the "sustainability activism" religion) is one of the greatest disservices we can do to our future.

Absolutely, and countries like China can scarcely believe their luck. Countries that can (still) outcompete China on many fronts are shortsightedly choosing not to. Especially given the 'winner take all' nature of many technologies (from AI to eCommerce), that China seems to understand, but most of the West does not.

Also, as you point out upthread, the ability to change countries quickly and with confidence is going to be an important skill as the nation-states still refuse to make this easy. China could roll out the red carpet for select high-skilled Western Expats, with deals like 'No income tax for 20 years' or 'we have created an expat town that resembles Paris/London/San Francisco for you to live in' or something like that.

HB

Kartik,

Its so interesting that you are also so surprised by what seems to be a dearth of information and recognition about the exceptionality of current world-wide high growth rates, and its implication for the future, especially in light of an accelerating tend in the growth rate itself.

I too was wondering why does anybody talk about anything else? That is the most transforming harbinger of our future lives going forward. So I did a few google searches with keywords similar to the ones you mentioned and this is how I ran into your website. But indeed there's very little on the subject out there. So kudos to you. As a matter of fact I was thinking that the amount of information, technology, sophistication, and wealth that humanity will add by the end of the century will be larger than what humanity has achieved since the dawn of Homo sapiens -- something that you captured superbly and poetically with your dream about the history of humanity book. There's an almost metaphysical, perhaps even religious aspect to it, in realizing that after three billion years of evolution, life and intelligence finally take flight (metaphorically) sometime in this century. The coincidence seems really bezzare, a paradox I described in one of your earlier columns.

In any case, back to slightly more detailed issues...

Why does not Eastern Europe catch up to the Eurozone? In my opinion...

In a nutshell because many of the ex-communist countries of Europe still have low levels of economic freedom. It is incredibly difficult to reverse coercive collectivism once it has taken hold in the psyche of a nation. Therefore, people who grow up in a coercively collectivist environment find it virtually impossible to shake it off. With communism having failed they simply turned to other forms of coercive collectivism, not realizing that economic freedom is the wellspring of prosperity. Even when they do realize it, coercive collectivism is so ingrained into someone who grew up into it that they quickly find other alternative hopeful narratives in other forms of coercive collectivism.

BTW, that is why I am opposed to even just trying out your idea of re-distributing the technological deflation through the money supply. It is incredibly difficult to reverse coercive collectivism once it has taken hold. Coercive collectivism is like a drug. Once you have ingested it for a while then you are forever hooked and destined to low growth --and thus demise.

Why is coercive collectivism so addictive? Because i think it is ingrained in our DNA through our long evolution in a virtually static world, where obedience to the tribe and the static wisdom of elders yielded the best personal and tribal survival result. This is no longer true in our era where a person is born in one world and dies in a completely different one. In any case, the instinctive attraction to coercive collectivism is a related but separate topic. Back to Eastern Europe...,

So these ex-communist nations may have rejected communism and socialism with passion, but coercive collectivism still permeates the personalities of their voters so they gravitate towards other forms of coercive collectivism, like fascism. Russia has more or less completed this transition from communism to near fascism and other ex-communist nations are flirting with various levels of it. Coercive collectivism has such a strong hold on the personalities of these nations that they cannot let go of it. Ironically they embrace forms of fascism (ie. right wing coercive collectivism) and even view it as antithetical to socialism -- not realizing that they are essentially two different facets of the same coin. They hope that since coercive collectivism of the left has not worked, coercive collectivism of the right must be the right recipe, not realizing that either forms yield a flatter effort/reward curve, and thus result in lower growth, inability to keep up with a much faster growing world average, and thus inevitable relative decline.

My prediction is that once these Eastern European generations who remember and resent communism die off, these societies will revert back to socialism. Perhaps not communism but in any case revert back to enough redistribution to flatten the effort/reward curve and make keeping up with average world growth hopeless. For example many of these ex communist counties have already reversed the flat (and low) taxation systems they adopted as a backlash to communism with progressive tax rates.

On a side note, I think that one advantage of being multi-cultural is the confidence to reject practices that any one culture takes for granted. Absent a multi-cultural background it is virtually impossible to sustainably resist the peer pressure of the culture that surrounds you. Then only true mavericks, often with other pathologies, are the ones who can think out of the box. The advantage of a multi-cultural person is that they can then arbitrage irrational national obsessions.

Europe's endemic obsession is higher levels of coercive collectivism "We're all in this together -- hence you must be drafted to the communal goals-- whether you want it or not". Obviously Americans are not devoid of that mentality, but overall I'd say it is more muted here; perhaps forty percent less if I can quantify it purely by gut feeling. That is enough to lift the US to a higher growth rate trendline that almost keeps up with average world growth. But the key word here is "almost". Unless we move to higher freedom levels, and primarily economic freedom levels, our prosperity ranking in the world will also erode, albeit at a slower pace compared to Europe.

Kartik Gada

HB,

But indeed there's very little on the subject out there. So kudos to you.

Thanks. I have tried hard for many years to rectify this deficit with my own output, but we are still very far ahead of our time just on account of debating this subject.

As a matter of fact I was thinking that the amount of information, technology, sophistication, and wealth that humanity will add by the end of the century will be larger than what humanity has achieved since the dawn of Homo sapiens

End of the century? It will be much sooner than that. For one thing, contemplate that half of all economic growth that has ever happened, has happened after 1998 (which is also consistent with a 40% gain over the last decade, as per the table above). Hence, in what year will people say that 2018 was such a halfway point? No later than 2032 or so, possibly sooner.

Recall this :
http://atom.singularity2050.com/2-the-exponential-trendline-of-economic-growth.html

Plus this chart :
http://futurist.typepad.com/.a/6a00d83452455969e201b7c86ce56a970b-pi

Why is coercive collectivism so addictive?

Well, China did manage to overcome parts of this, even with force when necessary. It was far worse of a place than Eastern Europe until the 1980s, but look at what has happened after 1991. It has been an amazing portion of the entire world's net growth (and almost all of its net poverty reduction).

Many aspects of China's economy are still state owned, but taxation as a percentage of GDP is lower than America's (let alone the Eurozone's).

Geoman

I have noticed a trend toward cities and states experimenting with Universal basic income, which is a bit like the ATOM payments you propose. I suspect they will botch things up mightily, ruining prospects for ATOM like thinking going forward. The sense what the problem is, and the solution, but don't know enough about either to get it right.

"just shows how constrained the economy is (we know that we are behind the long-term trendline." I agree. I often wonder what the upper bound of growth for the U.S. might be if those constraints were removed. But naturally, even as Trump removes restraints, individual states and cities seek to re-impose them. So it is hard to gauge real effects.

How such a tired, shop worn philosophy of socialism still maintains its hold on people after all these years is one of the most baffling mysteries of our age. It is 100 years old, and despite ample and frequent evidence that socialist policies are economically disastrous, they continue to be pursued with ever more vigor. How is this still possible?

Heck, I'll repeat myself. We KNOW what works. We know exactly how it works and why. We can show the math. We have innumerable examples. We can outline a simple, inexpensive, and easily implantable program that will allow any economy to grow rapidly, at 4-6%. Over a short period of time, with compounding, countries will become very wealthy indeed. It is not a road to riches, it is a superhighway - straight, with no traffic.

Why everyone, from individuals to nations, believes in anything other than the proven methods of economic growth is anyone's guess.

HB

Geoman,

Well, it depends what you mean by socialism. To me, redistributing the benefits of the ATOM to essentially non contributors or low contributors, as universal income does redistribute, if anything by preventing the natural technological deflation, *is* a form of redistributive socialism.

While to others yet, economic freedom means the liberty to redistribute your wallet via the democratic process.

HB

Kartik,

Yes indeed modeling prosperity as a geometric series (as evidenced by trendline so far) humanity will indeed double its prosperity by 2032. Then the next doubling takes fewer years, then even fewer,... soon singularity.

Is there a limit? Who knows? There may be. But in my view it is at least many doublings away, while most of the world (at least the self-righteous policy world) seems to think that we have either reached capacity, or are close to it.

"Well, China did manage to overcome parts of this, even with force when necessary. It was far worse of a place than Eastern Europe until the 1980s, but look at what has happened after 1991. It has been an amazing portion of the entire world's net growth (and almost all of its net poverty reduction).
Many aspects of China's economy are still state owned, but taxation as a percentage of GDP is lower than America's (let alone the Eurozone's). "

How true.

Indeed China seems to send a very ominous sign to the voter-lemmings of developed democracies. It is the message of how important economic freedom is, and in many ways it shows the success of economic freedom --even when imposed-- I know, an oxymoron.

I know that economic freedom has many definitions, for example to some people economic freedom means the liberty to vote your wallet in their direction :), but one could argue that a person is freer today in China than in, say, France. Yes, in France you can demonstrate every weekend, apparently even naked if you wish, but day in and day out the French people, through democratic vote, confiscate more than half of your vitality with income taxes, excise taxes, and value added taxes. In China you cannot really demonstrate but the Party mandarins generally confiscate less of your vitality in taxes. Now, all said and done I think that economic freedom is quite low in China, because there are more aspects to economic freedom beyond taxation.

But China points out how inefficient have developed Western democracy voter-lemmings made their societies through the irresistible temptation of redistribution through the polls. The message is ominous in that if western world voter-lemmings continue on the same path then their democracies will end. The drain of decline sucks everything down with it: past prosperity, past civilizations,...and lofty ideals. Actually, more than China, what points out this trend is that virtually all western world "advanced" democracies have growth rates that are half the world average world growth rate, of lower. Clearly an arithmetically deterministic path to decline and marginalization within a few short decades.

I generally agree with geoman that top economic freedom rankings are the elixir of maintaining high growth rates even after you've achieved first world economy status. There are even some systematic indexes (like the one published by the Frazer institute in Canada or the Heritage foundation in the US) that try to quantitatively evaluate economic freedom and rankings. While such indexes are useful in tracking a country's overall progress (actually non-progress if you are a political progressive, in which case you read the index backwards) they are still of limited utility for inter country comparisons. This is because the index is composed of ten factors and each factor is (arbitrarily and for simplicity) equally weighted. Given the very high correlation between economic freedom and growth (and thus longer term prosperity), and given the small absolute score differences between countries, a slightly different weighting would yield different country rankings. For example, should property rights and low taxes be given equal weight? Seems arbitrary.

However generally I agree. High levels of economic freedom are the key to maintaining a growth rate that is above world average even after you've become a developed nation, and thus avoid reversion to average prosperity with time (an increasingly shorter and shorter time as everything human accelerates exponentially).

Geoman

HB

Too true. I think the index could be further refined, and work toward a bit of a better formula that quantifies the factors. And naturally the factors feed off each other, say, lower taxes combined with greater property rights generates more growth than the sum of the two. There are all sorts of interesting multiplicative aspects to growth.


Kartik Gada

Geoman,

Why everyone, from individuals to nations, believes in anything other than the proven methods of economic growth is anyone's guess.

It is not a guess at all. There are biological reasons that about 70% of voters can be suckered into socialism.

The famous article from Imran explains why most (but not all) of this group is the way it is (and it is still 25% of this website's traffic, even 8+ years on).

http://www.singularity2050.com/the-misandry-bubble/

Just the latest example : Alexandria O-C. It is not remarkable that an unmarried woman is a socialist. What is remarkable is that she a) studied Economics at Boston U and apparently retained nothing, and b) has no curiosity about the causes of economic growth whatsoever.

Kartik Gada

Geoman,


I have noticed a trend toward cities and states experimenting with Universal basic income, which is a bit like the ATOM payments you propose. I suspect they will botch things up mightily, ruining prospects for ATOM like thinking going forward. The sense what the problem is, and the solution, but don't know enough about either to get it right.

Oh, they specifically are screwing it up. From Stockton, CA to Finland, they do a small 'UBI' that is a) temporary, b) not assessed in relation to any other entitlement programs, and c) certainly not tied to 0% income tax. When nothing happens, they declare it a failure. They violate the very first letter of the acronym itself, which is 'U' for 'UNIVERSAL'. Only when it is UNIVERSAL and PERMANENT will the curve of the entire society shift favorably.

Kartik Gada

HB,

The problem with your opposition to turning ATOM monetization into DUES is that you are effectively guaranteeing the extermination of about 98% of humans, mostly by humans killing off each other.

We have two choices : Either help humans become a decent fraction of post-Singularity technology (the 'pet dog' analogy that Geoman shared), or let them shrink to almost nothing (Mountain Gorillas are 98% of the same DNA as humans, but only 500 still survive).

To put this another way, I take you back to 252 Million years ago.

The accelerating rate of change was already in effect, and the dominant category of creatures was amphibians. But a large asteroid hit the earth, and 96% of all marine vertebrates and 70% of land vertibrates went extinct. It was the largest extinction event ever to happen on Earth.

https://en.wikipedia.org/wiki/Permian%E2%80%93Triassic_extinction_event

The effects are still felt to this day. Amphibians exist only in three types (frogs, toads, and salamanders), and almost all are smaller than 1 kg in size. The more advanced categories (reptiles, birds, and mammals) filled the gap, and amphibians are just too small a percentage of the fauna biomass of Earth to matter much. While the megatrend recovered immediately and returned to the trendline, the category that was dominant never did. If the asteroid had never hit, the trendline would have been the same, but amphibians would be a much larger part of life today.

Similarly, the second largest extinction event ever (and the most famous one by far) was 66 million years ago.

https://en.wikipedia.org/wiki/Cretaceous%E2%80%93Paleogene_extinction_event

It was not as dramatic, as only 75% of all species on Earth was destroyed. But while reptiles were overwhelmingly dominant before the asteroid hit, all tetrapods larger than 25 kg died off except for sea turtles and crocodiles. Hence, while reptiles today are larger than amphibians, only four types still exist (lizards, snakes, turtles, and crocodiles). The trendline reverted back with birds and mammals. Had this second asteroid never hit, reptiles rather than mammals would be dominant today, even on the same trendline.

For this reason, a distribution of ATOM deflation enables more people to participate in innovation, more startups, and more demand for technology. Without this distribution, you will not have innovation, demand, or velocity of money. AI will still find a way to advance, but humans will probably get crowded out and most will end up killing each other. This distribution is sort of like ensuring either of the aforementioned asteroids did not hit. Even though we have no power to change the trendline, we do have some limited power to ensure it partly includes us post-Singularity or not.

More simply, certain societal resources have to be used to create markets. Roads always were and always will be disproportionately paid for by the Top 1%, but usable by all. By your method, there should be no roads. At the other extreme, socialists want to take this logic to everything, which is also terrible (as you correctly point out in Europe's case).

If societal resources to create a market has a positive ROI, it can be done. Private entities just won't do it. This still represents a massive shrinkage of govt. scope down to just a Central Bank that publishes a monthly DUES payout that was not money taken from any human.

Geoman

Alexandria O-C is truly strange. Not that she has anything new to say, but that a person can get a degree in economics from an accredited university and believe in the things she says...it is just baffling how that is possible.

We know she is wrong. Mathematically, economically, historically, intellectually. The only question - does she know she is wrong?

In the run up to the singularity, it is very hard to chart the least bumpy course of action. In retrospect it will be obvious. But now? DUES might be it. But it might not be. I'm a fan - I think you are advocating for something that needs to be seriously discussed. It is worth talking about, and thinking about, even if we don't do it.

I suspect our main problem will be the need to react much faster than our politics will allow, and that the correct strategy will be changing strategies frequently at different key moments in the run-up to the singularity. It will be like the game of frogger, where we hope to not get run over.

Which makes Alexandria O-C slightly terrifying - do we want someone who not only learned nothing during her education, but obviously clings to tired, old, shopworn economic ideas? The worst possible choice going forward.

Geoman

I imagine the best possible singularity outcome is we don't even notice the singularity. Everything is simply better. Much better. Our lives are free from want. We are free to pursue whatever it is we desire. Our real rulers mostly work in the shadows, unseen.

The singularity enhanced portion of our race has moved off to bigger and better things - our care and maintenance is a triviality to them, like saving an old scrapbook in the garage. Too much trouble to bother tossing out. Mostly they just keep us from hurting one another, and leave us to our own devices.

Kartik Gada

Geoman,

The anti-misandry community often discusses which subjects are the ones completely out of reach of women. Economics and Astronomy consistently come up as the two highest-ranked fields of knowledge on this metric. Wikipedia never would release contribution by subject by gender (across all of Wikipedia, women contribute 13%), since articles in these two would indicate 100% male contribution.

Regarding Alexandria O-C, demographically she is precisely who the Democrats are trending towards (and thus what the GOPe will unsuccessfully try to copy). But if her economic views were libertarian, she would have got exactly the same number of votes, since her ideology is not the reason people voted for her at all. Getting an Economics degree from a highly ranked school and still having no clue says more about the farce that Universities have become more than anything else.

She even has an asteroid named after her! Yet, I bet she has no curiosity about astronomy whatsoever, even after that.

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