Category Archives: Abundance

Minor feedback and reflections on Ray Dalio’s capitalism manifesto

Ray Dalio just published a two part manifesto on how capitalism needs to be reformed.

Dalio’s Diagnosis 

Dalio’s main point is that “capitalists don’t know how to divide the pie well and socialists don’t know how to growth the pie well.”

This is a problem for capitalist countries because rising inequality has both negative affects on individuals and countries: high inequality reduces economic mobility and weakens political governance.

I am not an expert in inequality, economic mobility, or governance, so it’s hard for me evaluate his specific claims.

But my instinct is too put a little less emphasis on capitalism.

Rising inequality seems to be the trend of almost all political systems.

Walter Schiedel’s book The Great Leveler does a good job of showing how inequality tends to rise in most societies (any system can be gamed) and that it’s often only war, revolutions, state collapse, and plagues that bring inequality back down.

Dalio thinks there’s something specifically inherent about capitalism that leads to inequality. I think there’s something generally inherent about governments and power.

Once humans left hunter gatherer societies, rising inequality has been the norm in most societies.

Capitalism is just the latest manifestation of the trend.

Stability vs. Growth 

Another argument which is somewhat implicit in Dalio’s argument but I wish would have been more explicit: given the incredible compounding of even small GDP increases, we should care much more about societal stability than maximizing growth.

Over the long-run, humans will be very rich by today’s standards so long as we can survive a couple more centuries.

In most cases, growth and stability go hand-in-hand, but when they don’t (perhaps in the case of inequality), we should err on the side of stability.

Can We Do Anything About It?

Schiedel’s book presents a bleak picture about a society’s ability to reduce inequality.

But humans haven’t been around for that long. We’ve never been this wealthy. And never before have so many humans lived in democratic societies.

It took us from the Industrial Revolution to the end of World War II to find a governmental system that fit our last major round technological and economic advancement.

Most advanced countries are now some form of capitalist democracies with large welfare states (at least by historical standards).

I hope our next governance search requires less bloodshed.

If it’s simply a matter of adjusting our current system, this might be possible.

If it’s a matter of finding whole new systems of governance, then that likely means wars and revolutions, which we should all fear given the weapons at our disposal.

How Hard is Life? Here’s What the Numbers Say

Scott Alexander just wrote one of the more important posts I’ve read this year (HT Tyler Cowen).

Please do read the full post.

After Scott gave qualitative information about human suffering in America, he ran some numbers to come up with what a random sample of 20 Americans might be dealing with.

Here’s what he came up with (NP = no problem in terms of the narrow ailments he ran):

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In sum, only 9 out of 20 Americans have escaped some combination of chronic pain, alcoholism, sexual abuse, domestic violence, unemployment, and depression.

Of course, this doesn’t mean that these people can’t lead happy and meaningful lives (I personnaly am very close with three alcoholics who have kicked drinking and are thriving).

But this is also a narrow list of ailments: I could think of numerous other sufferings that could make life very, very difficult.

A few takeaways, most of which are pretty obvious:

  1. Things were probably harder back in the day. This seems to definitely be true during the agriculture and early industrial ages, and was probably true in the hunter and gather age as well.
  2. The United States is amongst the richest nations in the world. It also has fairly high levels of happiness and meaning rates. So if the numbers are grim here, they are most likely worse for much of the world.
  3. So while things are indeed better, they are not amazing. Declaring that things are amazing is ignorant at best and destructive at worst, as the policy regime for “things are amazing” is likely to be different than the policy regime for “things are still pretty tough for a lot of people.”
  4. Of course, humans brains were not evolved to be happiness machines, so suffering will always be with us so long as we retain our humanness. But I hope there doesn’t need to be this much suffering.

It is interesting to think about what this might mean for education.

I’ll try to tackle that in a later post.

Wheat Enslaved Us. We Escaped. But What is the New Wheat?


In Yuval Harari’s book, Sapiens, he argues that wheat conquered humans.

His argument:

  • Humans learned how to grow wheat.
  • This allowed our population to expand.
  • This caused us to grow more wheat.
  • This required us to work long hours doing backbreaking labor. This made many of us miserable.
  • Ultimately, both wheat and humans expanded their populations, but, for humans, it was at the expense of our happiness.

I find this to be fairly convincing. Basically, wheat shifted humans into a high-growth, low happiness equilibrium that was hard to escape (it took the industrial revolution to get us out of it).

This got me thinking: what’s the new wheat? What in our lives do we have little chance of getting rid of but is arguably not making us any happier?

Some possibilities:

1. Sugar: It causes us to become obese and eventually die.

2. Sexual Media: From fashion magazines to commercials to pornography, it causes us to obsess over un-winnable games, likely causing depression and other mental disorders.

3. Alcohol: It causes us to kill each other and become depressed.

4. Economic Growth: This addiction may lead us to make Earth uninhabitable to humans.

I’m sure one could up with others. But all of the above have reached massive scale, have proven extremely difficult to curb, and, either already (sugar, media, alcohol) or may (economic growth) cause severe unhappiness (or extinction).

The common theme here is that humans are increasingly struggling with abundance. This is not surprising given that our brains evolved to operate in environments where scarcity was the norm.

What is the marshmallow test?

The marshmallow test is a test that measures how well any given human can operate in a world of abundance.