Note: A version of this article originally appeared as a column in Spanish in El Mercurio, one of Chile’s largest newspapers.
Many entrepreneurs dream of solving a problem, providing great service to their clients and ideally doing something that makes the world a better place when they start their company. One of the side effects of a successful startup is that they might make lots of money. (more…)
tl;dr summary here. But you should read the entire post.
Inequality in the Internet Age
Inequality has increased since the 1970s. The share of national income and the total wealth that goes to the top 10%, 5%, 1%, .1% and .001% has has gone up. And it continues to go higher. We haven’t seen levels like this since the Gilded Age.
The top 10% now owns 61.9% of all US wealth, up from about ~50% in 1989, while the next 10% now owns 11.9% and the bottom 80% now owns 26.8%, down from ~37% in in 1989. The top .1% owns the same as the bottom 90%, about 22% of net household wealth for the first time since pre-WWII. We’re experiencing a massive shift in wealth. And it’s getting redistributed up the ladder. (more…)
Don’t be lazy. Read the entire post. But if you must, here’s a summary.
Income and wealth inequality have increased massively since the 1970s. Productivity was decoupled from wage growth. Most people think the middle class is getting destroyed. But in reality, while the top 10% have left behind the bottom 90%, the top 1% have left behind the 10% and the .01% have left behind the top 1% and the top .001%, or about 400 families, have left behind the top .01%
New technology since the 70s allows for unprecedented wealth accumulation via siren servers and network effects in finance and tech. Government policy, especially tax policy, but also super low interest rates put the inequality created by technology on steroids.
Uber is an example of a winner take all tech play that clearly makes peoples’ lives better in the short and medium term. Uber is in a winner take all (or most) industry, which means it’ll kill the competition and then send its ever increasing 10-30% commission to Bermuda via Ireland via the Netherlands and Ireland again into the hands of a its cofounders and early investors and out of the local economy. It makes a bell curve shaped industry into a winner take all. And when (not if) self driving cars happen, Uber or potentially Telsa will eliminate the drivers and take 100% of the transportation money out of the local economy.
Consequences: super rich no longer interact with the rest of us, leading to loss of empathy, making it easy to write out of touch Paul Graham style blog posts and justify the existence of inequality. This justification leads to Latin America style banana republics like the ones I’ve lived in for the past five years. I’m not anxious for this to happen in the US. We can make changes, but it’ll be hard.
Ever since I started writing here, I’ve done a year end post summarizing what I’ve done in the past year. These posts are mostly for me, so that I can look back and remember what I did, what I was thinking and what was important to me each year. Previous versions (2000s, 2009, 2010, 2011, 2012, 2013, 2014). Here’s what I did in 2015.
I rang in 2015 on a cold night in Wisconsin with friends and family, then went back to Chile to get back to summer. In 2015 I was in Chile for about 9 months, the least I’ve spent in Chile since 2011. It was an eventful year that took me to nine countries for work and fun. Looking back, I think 2015 can be distilled down to two main themes. Focus + Growth, and Reconnecting.