I spot checked some of this and from what I can find, the median salary in London is about $12k more than Mississippi, and the median house price in London is about $100k less than California.
Bear in mind that obviously the mean salary in London is going to be far higher than the median (the finance industry will skew it), while I'm not sure that's as extreme as Mississippi. Additionally median salaries reflect a lot of service jobs and similar labour. Dubai has a lower median wage than either London or Mississippi, but people don't think of it as economically broken.
Comparing California (an extremely large state that I presume has cheaper housing outside major urban areas) to a city seems a bit of a poor comparison.
I don't disagree that the UK has high energy costs.
If you’re trying to do a rebuttal, saying that wages are slightly higher than Mississippi and house prices are slightly lower than Cali doesn’t refute anything, it just serves to make the example more extreme and concrete. Look at house prices in Mississippi in relation to their income and then compare the same ratio for Cali and for London.
Dubai is absolutely economically broken lol. The city was built on cheap foreign slave labor. And the luxurious amenities of the city are only for the wealthy royal and foreigners. Their main export besides oil is the illusion of a thriving metropolis
The example I like to use to demonstrate how broken labor vs. service costs are in the UAE is to compare the price of a Big Mac meal to the price of a standard manual car wash (closer to detailing tbh).
In the UAE, a Big Mac meal costs approximately 35 AED ($10). On the other hand, a manual car wash - approx. 1-2 hours of labor - can cost you around 20 AED.
In other words, you could get almost two manual car washes for the price of a Big Mac.
Compare the housing costs of London to the housing costs of San Francisco and then swap out those Bay Area salaries with your “slightly above Mississippi” wages and you’ll see why London looks so broken to people used to LA/SF/NY.
There are differences, but this is oversimplified, and market is “mostly” working. You need more money in California, for transportation, for health care. The standard is bigger houses (bigger everything) in Cali. Life might be richer, in some ways more pleasant, in London (it’s not weather though), including shorter flights to many interesting places.
From my experience the ratio of savings was similar, but the ppp of course favored US for absolute numbers.
Countries like Indonesia have banned foreigners from owning land altogether. You can apparently still own property through land-lease agreements and other arrangements, but not the land. I think they've cracked down on illegal rentals too.
House prices are only "out of wack" in areas with poor social housing programs.
Housing in Vienna is still affordable, only due to their very successful public housing programs. Public housing can be both beautiful and highly affordable if you want it to be, it's not like we don't know how to make good quality homes with lovely public amenities. It's mostly developers that want to skim on everything while selling it at the highest cost possible.
Poor system if this is the outcome: unaffordability.
I am interested in what is working in Vienna when “housing problem” is what almost every city in “the West” has or thinks it has.
To me it seems to be a combination of
- wealth inequality (eg 20/30 trillion dollars was printed and furloughed out in Covid, which funnels its way up to the holders of the most assets, seeing asset price inflation but no attempt to tax back the money printed). Repeat on different scales for unfair tax systems and poor infrastructure and and and
- urban planning (we think the ideal city is dense using seven storey or so apartment buildings and fairly aggressive anti-car (ie far less parking than seems possible) with better public transport and lots of pedestrian access. This describes almost no cities
- mortgages and other pro house incentives. You want house price inflation for decade after decade, just allow people to borrow a greater ratio against their salary — and allow married women into the workplace. Suddenly turning a mortgage limit of 2.5 x a man’s salary into 5x a dual couples salary. People bid up prices, forcing more couples to have two salaries to compete. And companies don’t have to increase salary to compensate … people combine salaries and go deeper into debt. Hell if you only had one policy weapon, forcing 2.5 borrowing against one highest paid persons salary is not a bad one. You won’t get re-elected however.
Real estate prices are out of whack everywhere. Even in places with no good jobs, low population density, and rapid depopulation, real estate prices are increasing exponentially. There are no market forces in play anymore.
London doesn't have the income level of Mississippi, although that might be true for the UK average. I'd say that the UK may be "seriously broken", but not more so than other post-industrial countries, including the US (or France, or Japan). It's just broken in different ways. E.g. life expectancy in the UK is significantly higher than in America even though they were the same in the '80s. Education levels (and measures such as literacy profficiency and skills etc.) are also significantly better in the UK than in the US. Somewhat tongue in cheek, Americans are richer but they don't seem to be putting their money to good use, as Brits are better educated and live longer.
Nobody will admit that the housing is overpriced, so they would have to be forced to do so.
This is terrible for normal people, and slightly bad for the investors, but only a crisis or organized government action can reset the damage done by decades of investment in already existing buildings.
> while in the US you see automated car washes, in the uk most car washes are Albanians n other immigrants etc
Er what? I moved away from the UK in 2007 but even then the only place I or my parents washed a car was the ubiquitous petrol station automated car wash.
Yes, it is unimaginable that the UK has replaced most of their automated car washes with immigrants washing cars manually. I've been back there and I've still family there, it's not that different "on the ground" as it were, despite the big political changes.
I can only think of one automated wash in my UK town, and well over 10 "Albanian" hand washes. Personally I go to the Albanians every time - they take pride in what they're doing, handle the vehicle with care and do a far, far better job than an auto wash.
No idea where OP is based but like most suggestions about the UK or London online it's bullshit. Most petrol stations have the same automated car washes they've always had. If you want your car hand washed there are lots of people doing that too, as there always have been. Like all places, the UK and/or London has plenty of issues including serious ones - but I'd still pick it over anywhere in the US regardless of salary differences.
Conversely, I've no idea where you or the parent has the idea that the UK is full of automated car washes and the OP is talking bullshit. I live in London and can think of a only a handful of the old fashioned automatic car washes.
Whereas I can get a hand carwash at pretty much any supermarket car park I land on. From a guy with a bucket and trolley to a full team of four going at it with a power wash. Tesco, Sainsbury's, wherever.
The Albanian angle feels loaded, but it's true that many of the employees do seem to be recent immigrants.
I don't see much point denying this reality, it feels a bit like trying to argue there's always been high streets full of betting shops, charity shops, vape stores and American candy shops.
London is an odd one as space is limited and the hand wash places can pop up anywhere quite easily. If I look at the more suburban place I'm from most petrol stations still have the automated ones (contactless payment now instead of the tokens). And most of the larger supermarkets there that have petrol stations still have the automated car washes too.
The core issue is that most major businesses are ultimately owned directly or indirectly abroad, largely in America, with some tapping by London-based intermediaries.
Supermarkets and shopping centres, national assets (e.g., water) the story is the same. Then there's Amazon et al.
Profit generated in this country is by and large not spent here, and is certainly not taxed adequately.
This causes inequality by short-circuiting redistributive measures, either local economic multipliers or government spending.
What gains are felt are concentrated in service sectors which facilitate global capital, concentrated in London. See OP's thoughts on legalistic societies.
It compares to inequality in England before the US was a thing, in the same way. Small elite benefiting from global plunder, vast inequality internally.
The British Empire didn't actually end. There was a hostile takeover by Washington at the end of WW2.
One of the best books I read this year. I think a lot of HN readers will like it. A really balanced take on China that also digs deep into the perennial question of “why can’t we build big infrastructure projects in the US?” that comes up here quite often.
Well of course, and the book digs a little into the history as well, and what changed around the 1960s/70s. There is a long section on Robert Moses, for example. He draws a lot of parallels between modern China and the US in the 19th and early 20th centuries - totally different political systems, but similar “breakneck” ability to build.
It also defies easy summaries, but my biggest takeaways were that 1) the CCP really doesn't care about the costs any of its policies (one-child, zero COVID, etc) impose on its citizenry, and 2) that the CCP is actively preparing China for a world where it's entirely cut off from the West, because it realizes that's the price to pay for invading Taiwan.
I read the whole post. Really revealing - so much analysis but not a single mention of a global system that is reaching a singularity in wealth concentration, and maybe how that might be an important dimension to reflect on. Its like using so many words to deeply analyze the speed differentials in a car race, but not looking up to see that all the drivers are racing towards a brick wall.
> If the Bay Area once had an impish side, it has gone the way of most hardware tinkerers and hippie communes.
Woz had that (still does). He was smart enough to take his winnings and bail. I think that many in SV can't fathom why, but I suspect I know exactly why.
I do remember the tech community as being full of humor and whimsy. I miss that.
I agree. At first I briefly skimmed it and thought it was going to be a puff piece on China's AI efforts (unfair of me), but a couple paragraphs caught me and I read the whole thing. I'm glad I did.
Hard disagree. How many paragraphs of fawning over the unique culture of the Bay Area must I endure before he arrives at the point?
Such gems as
> I like SF house parties, where people take off their shoes at the entrance and enter a space in which speech can be heard over music, which feels so much more civilized than descending into a loud bar in New York. It’s easy to fall into a nerdy conversation almost immediately with someone young and earnest.
In the thread "Roomba maker goes bankrupt, Chinese owner emerges" [1], I wrote about China'a hardware capability now going far beyond what US can imagine. In Dan's article;
>A rule of thumb is that it takes five years from an American, German, or Japanese automaker to dream up a new car design and launch that model on the roads; in China, it’s closer to 18 months.
Not only is China 3 - 5 times faster in terms of product launches, they would have launch it with a production scale that is at least double the output of other auto marker. If you were to put capacity into the equation as well, China is an order of magnitude faster than any competing countries, at half the cost if not even lower.
Every single year since 2022 China has added more solar power capacity than the entire US solar capacity. And they are still accelerating, with the current roadmap and trend they could install double the entire US solar power capacity in a single year by 2030.
CATL's Sodium Ion Battery is already in production and will be used by EVs and large scale energy storage by end of this year. The cost advantage of these new EV would mean there is partially zero chance EU can compete. And if EU are moaning about it now, they cant even imagine what is coming.
Thanks to AI pushing up memory and NAND price. YMTC and CXMT now have enough breathing room to catch up. If they play this right, I wont be surprised by 2035 30 - 40% of DRAM and NAND will be made by the two Chinese firms. Although judging from their past execution record I highly doubt this will happen, but expect may be 10-15% maximum.
Beyond tech, there are also other part of manufacturing that China has matched or exceeded rest of the world without being noticed by many. Lab Grown Diamond, Cosmetic Production, Agricultural Machinery, Reinforced glass etc. Their 10 years plan on agricultural improvement also come to fruition especially in terms of fruit and veg. I wont be surprised if they no long need US soy bean within 10 years time.
All in all a lot of things in China has passed escape velocity and there is no turning back. China understand US better than US understand themselves, and US doesn't even have any idea about China. I think the quote from the article sums this up pretty well.
"Beijing has been preparing for Cold War without eagerness for waging it, while the US wants to wage a Cold War without preparing for it.".
China doesn't particularly need US soybeans but they're going to have to continue importing soybeans from somewhere (like Brazil or Canada) indefinitely. Like any commodity, soybeans are (somewhat) fungible. China doesn't have the right combination of arable land and cheap fertilizer necessary to be self-sufficient in soy at an economically viable cost. Of course, China's population is now declining so ironically that could increase their food security in a few decades.
Along ops reasoning, PRC will find domestic slop to feed pigs. There's already soybean replacement program in the pipelines, i.e. synthetic science + cheap power = future industrial substitutes. Because soybean conundrum is arable land (all sorts of soybean yield, lack of GMO, small plot farmer complexity mixed in), but pork prices fall under broad food (national) security so expect autarky > comparative advantage / cost when domestic pipeline in place. Like there's no reason for PRC to pay US soybean premium over Brazil, but they would because economic viability not as important.
TBH Anything strategic, expect PRC to adopt energy-to-matter to substitutes when the teach stack is figured out. Or at least have as less economic backup, i.e. PRC has unlimited cheap fertilizer (was top fertilizer producer via coal gasification) just more emission heavy. They're on way to displace all oil imports with coal to olefin/liquidation and EV. HQ steel via simply hammering energy into mid ores. All signs point they're moving towards strategic domestic abundance / autarky where they can.
that's obvious that some country with 1.5B working people will have edge in some niches, and will demonstrate tremendous growth from the bottom where they were 20 years ago.
But for global picture, if we are comparing Western World: US+Canada+EU vs China in technological domination, the picture is likely not super-clear and more complex analysis is required. Even if we consider manufacturing output, where China is supposedly global leader, we see it is 5.5T for Western world vs 4.6T for China (according to my brief google searching).
As a Brit, I struggled to get much interesting out of this considering how many times he mentions "Europe" (in that condescendingly general way that only US folks seem to manage).
He talks about "European" prospects and his trip to Denmark but then cites London as a representative example?
This almost broke my brain it felt so incoherent.
Never mind that (despite my personal wishes) we're not even part of the EU (which I assume is what he means by "Europe"). Surely he knows what an anomaly London is? It's not representative of anything except itself.
Referencing the extreme wage dispersion and severe housing pressure of London in a rant about Europe in general is a completely pointless endeavour.
He did say one thing I agree with. If you like good food, rich culture and great surroundings, "Europe" is indeed a lovely place to be for the most part.
Maybe I'll just keep that as my takeaway. It's too early in the year for doom and gloom anyway
> Never mind that (despite my personal wishes) we're not even part of the EU (which I assume is what he means by "Europe").
Nah, Americans aren’t particularly interested in which Europeans are offended by being identified as “Europeans” this week. If we say “Europe” without qualification we’re probably just talking about the continent. (And no, we don’t even use the word “continent” as a distinction within Europe, except when referring to hotel breakfasts.)
Americans don’t really have much of a concept of what European identity is, and we don’t really care (other than being grateful for a few decades of relative peace after 1,000 or so years of near constant war).
There is something very irritating seeing someone dismiss someone else on the internet using condescending therapy speak 'Thats Ok', nevermind the fact that calling him out as some ignorant Chinese guy while China has hundreds of cultures and languages, as if a Chinese person couldn't comprehend... Europe.
The way to respect isn’t through shaming people into it. It’s through demonstration of value, in this case understanding of nuance.
Instead we get an application of external logic and values which can’t be used to properly reason about the entity they’re applied to.
There’s no need for frustration. We take the stoic approach here. It’s OK. You are a product of your environment. Everything you’ve ever experienced told you this is the way to act.
China also has many different cultures, languages and so on for the over 1.4 billion people who live there. Why would the “nuance” of Europe be “lost” on a Chinese person?
China mostly has a single national identity, and provincial differences are way too nuanced to be mapped in the same way that country differences in Europe would be. It would be like trying to get Americans to understand that "Henan man" is a meme similar to the "Florida man" meme.
> The nuance of 40 different cultures on a small continent might be lost on him.
I don’t know about the author in particular, but Americans are generally aware of the “nuanced” European history of near constant war between rival nations, states, factions, and religions.
He's a Canadian in America writing about China. He writes about bloc strategic competition. EU+UK is treated as bloc in this context, individual European countries are generally irrelevant alone.
It's pretty clear he meant Europe as the continent, which London is a part of.
It's very similar to "Europeans" broadly generalizing the US as one homogenous country, assuming everyone and everything in Chicago is the same as New York or Dallas.
Source: me, a brit, who has lived and worked in UK and US.
Since I’ve lived in the UK before, I will say that yes it is not the same as continental Europe, but culturally, socially, and economically it is deeply tied into Europe, is European. One could say the same thing about Ireland—except the majority of Ireland is in the EU. Does Europe stop at the border of Northern Ireland?
Just like San Francisco and Dallas/Texas (from his article) are very different in the US, we should expect lot of differences in Europe (as others mentioned, he clubs UK with EU). Housing is a general problem for all major cities though, not sure why you think it is unique to London in the whole continent. Stockholm, Paris, Dublin, Lisbon to name a few, are pretty bad for housing in their own unique ways. Certainly shouldn't be "breaking your brain".
> Just like San Francisco and Dallas/Texas (from his article) are very different in the US, we should expect lot of differences in Europe
Dallas and San Francisco are both English speaking cities with a shared recent history of being part of the same nation. Most cities in Europe are as close as New York and Mexico City - Dallas and San Francisco is probably more analogous to Milan and Naples (different cultures, different histories, but now speak the same language and are part of the same nation).
He’s writing about China and US. Sure, you can call Europe more diverse, but still it makes sense to draw some generalizations, and I don’t think he’s far from the mark (having myself lived in EU, UK and US).
As often the case with Dan's letters, a well balanced take on many issues. I particularly appreciated the thoughts on AI and (what I read) the undertone of infrastructure being the real differentiator between the US effort and China. We'll see how it plays out this year. "May you live in exciting times" etc.
I don't care who the next hegemon will be; US or China. But please pray, can these people tell what their next strategy is for the rest of the world after the Cold War ends. Will the next regime advance sciences further after whichever side wins the Cold War? Can't that be done without the war? US has been hegemon since last 5 or so decades; has it worked out best even ONLY for the Americans if not for the rest of the world. I will ask a very obvious question taught as a intuition pump by Daniel Dennett, "Then What? Then What? Then What?". Do these blob forces have post-Cold War steps figured out for the best of humanity, if not for whole of humanity but a national subset.
I don't know if it's that hard to figure out, at least in the short-term. China's #1 goal should be to keep the value of their currency stable and push hard on the neoliberal expansionist path. If the United States' financialized economy starts to sag, this is China's opportunity to provide discount stability to the nations that China needs as allies.
Too bad it’s not true. China has wanted this for a long long time. They view their relative weakness vs the West as humiliating and temporary, and want to correct that by any means available.
The US doesn't have a plan, it has a framework. The framework allows it to be nimble in a way that centralized economies (like China) can never match. My money's on the US out-competing everyone else in the long run.
I can’t tell if this is sarcasm or if you are serious. The USA’s framework is to just wish for things to happen and then be surprised when those things don’t happen. There is basically no executing plan beyond grifting money to a few corporations because they supported the president during the election.
Seriously, and we have one of the most centrally planned economies in existence, it's just controlled by the elites rather than through democratic norms as it was during the new deal coalition.
Even if it’s a goal, it’s not a plan. The article talks about it, but Biden’s push for manufacturing wasn’t very aggressive, and Trump has basically stopped it. We’ve seen a loss in manufacturing jobs from tariffs and Trump idiotically deported Korean engineers working in local battery production plants. Simply protecting our existing companies (which are not very efficient, see shipbuilders) is not even close to enough to competing
The "US plan," is driven by the executive office. That is to say, the by the US president.
Insofar as there is any plan, the current officeholder's priorities are to project the appearance of personal power on television. If you're wondering what's going on strategically, don't go thinking that there's some grand plan, or even an intention to benefit the United States in the long term. There are some people in the cabinet who are thinking long term, but that's not universal, and that's not what they're selected for. Every action that is taken is to satisfy the president's narcissism and ego in the present moment. You have to understand the "US plan" in this light for anything coming out of the executive office to make sense.
It all falls into place if you contemplate the possibility that there is no US.
There's stock market bros, kill people bros, government welfare bros and some mega business bros.
None of them want to know anything beyond my kids go to private school, get nepo baby job.
This is what humans are capable of - not just in USA, as a species. USA's 'plan' or rather inevitability is to fall apart. China will be the next power and it'll also fall apart, like USSR fell apart and USA is falling apart for the world to see.
Maybe in another few thousand years it'll be different, I doubt it. Read Plato's Republic you're above 140 IQ - it spells it all out so nicely that one you grok it, you need not know much of anything else regarding politics.
To my surprise I found myself reading the entire rather long piece. His thoughts on AI, San Francisco, China, and other topics, are well worth the time.
Great read. I listened to Dan on Tyler Cowen’s podcast and found him to be a very interesting thinker. He has the air of someone who is a lot more intellectually honest than a lot of our pundits (Tyler is pretty good though, he’s not that target of this comment)
One of my intentions for this coming year is to critically examine and (if appropriate) alter or dispel some preconceptions I have. To that end, I'm curious about this part:
> You don’t have to convince the elites or the populace that growth is good or that entrepreneurs could be celebrated. Meanwhile in Europe, perhaps 15 percent of the electorate actively believes in degrowth. I feel it’s impossible to convince Europeans to act in their self interest.
Can someone elaborate on how growth is aligned with the general interest? To my mind, although growth could _theoretically_ lead to a "lifting all boats" improvement across the board, in practice it inevitably leads to greater concentration of wealth for the elite while the populace deals with negative externalities like pollution, congestion, and advertizing. Degrowth, on the other hand, would directly reduce those externalities; and, if imposed via progressive taxation, would have further societal benefits via funded programs.
I'd very much like to hear the counter-argument. It would be pleasant and convenient to believe that growth and industry are Good, Actually, so that I needn't feel guilty for contributing to them or for furthering my own position - but (sadly!) I can't just make myself believe something without justification.
> Can someone elaborate on how growth is aligned with the general interest?
Empirically, the past 200 years have seen high growth globally, and human well being has improved massively as a result. Life expectancy has skyrocketed, infant death, hunger have gone down to near zero, literacy has gone up, work is much more comfortable, interesting and rewarding, etc. But at a more fundamental level, our material quality of life is that of literal kings. The 1st decile poorest people in the US or Europe have much better living conditions than a king of 500 years ago. We are so lucky to benefit from this, yet we completely forgot that fact. You complain about congestion and advertizing, but with degrowth you would complain about hunger and dying from cold during winter.
>But at a more fundamental level, our material quality of life is that of literal kings.
This cannot be overstated. To wit, a Honda Accord (or equivalent mid-range car of today) is objectively superior to a Rolls Royce from the 90s in terms of amenities, engine power/efficiency, quietness, build quality, safety, etc. The same is true for quality-of-life improvements across a vast swath of consumer goods, and therefore consumer lifestyles.
Without growth, it's unlikely we'd see those improvements manifest. Carefully consider the lifestyle of someone living several decades ago. Would you honestly want to live such a lifestyle yourself? That's where degrowth likely leads. As the article says, "I feel it’s impossible to convince Europeans to act in their self interest. You can’t even convince them to adopt air conditioning in the summer."
> Carefully consider the lifestyle of someone living several decades ago. Would you honestly want to live such a lifestyle yourself?
Sure, I lived it, and it was very pleasant at the time and in many ways better than now in retrospect. e.g. always-on access to infinite content engines like YouTube, TikTok, X, Facebook, etc. is probably a net negative, both for individuals and society. I wouldn't want to go back a century or more and give up air conditioning, dishwashers, washing machines, air travel, electric lights. But a few decades, sure, in a heartbeat.
I agree, 30 years ago a working man doing 40 hours a week in a factory could still support a family on one income and expect to own a house. We hit a peak 30-40 years ago.
For all the insightful takes about everything under the Sun, Dan's cynicism and skewed view towards "Europe" are shown in this letter.
It's not that all his takes are wrong, it's the exaggeration, the doom and gloom and a somewhat dismissal or some unsolved personal issues he has with "Europeans".
The irony is not lost that Dan acts as smug and dismissal as he accuses Europeans to be.
Regarding the whole "Degrowth" thing: yes Europe has those and they found their gold in Governmental entities and they entertain the rich. But.. that's exactly what happens in the US too and Dan as knowledge as he is should know this was mostly an American academia export, he just needs to talk with some people in the very same colleges he regularly set foot into.
Also, he should take a hint when he says historically liberal societies have fared much better than autocratic ones even if those are very focused and appear to make progress very quickly. Having a few mega-bilionaires directing what the populace do or not do might not be a smart move as it sounds. We'll see when the AI musical chairs stops.
Btw, Europe has been dead and on the brink of destruction for a few centuries by now. And according to experts the EU is about to collapse 3 or 4 times a year - minimum.
Wealth inevitably concentrates in the hands of the elite no matter the economic conditions. There are plenty of failed states where all the wealth ended up in the hands of warlords and dictators.
It’s something that regularly has to be dealt with in societies separately from the economic situation.
There are those who think massive concentration of wealth is not a problem at all and is just a product of healthy capitalism. Tax is theft, and individual property rights are above all else.
There are others who want some kind of communist revolution, where the entire structure of society and property ownership is changed. The workers should benefit from their work as much as the managers.
Personally, I feel like there's a middle ground to hit. We should be able to make changes to our current system in the US without needing anything too radical.
We have some good examples from the last century, such as trust busting, the New Deal, and the Great Society. These programs made major improvements without changing the country's fundamental economic system or growth trajectory.
Believing in growth just means believing that the future will be better than the past.
And believing this, is the single thing keeping the entire world running.
Germany is currently ruining itself because its stagnating economy means that it can not keep up with the rising costs for its pension system and has to increasingly raise more funds from a smaller, population which is seeing little productivity gains.
>Degrowth, on the other hand, would directly reduce those externalities; and, if imposed via progressive taxation, would have further societal benefits via funded programs.
Do you think that Germany will have social benefits at all, when the auto industry collapses. Where is the money coming from?
Economic growth has enabled mass literacy. It has created industrial agriculture, which eliminated hunger for economic reasons in all countries which practice it. Degrowth means turning our back on the single process which caused the greatest increase in human quality of life.
In the vibrant capitalist society envisioned by Joseph Schumpeter, all boats are lifted because better businesses replace incumbents, both improving products for the larger society and continually redistributing wealth. In my view, since 2008 my country (the US) has distanced itself from this policy, instead focusing on protecting incumbents for fear of loss of employment. The unpopular policy of bailouts pursued in 2008-2009 and then again during the pandemic has led to a stagnant, top-heavy economy with most of the disadvantages of capitalism and less and less of the upside.
I don't think degrowth is necessary to solve this problem, although I'm sure it has its merits. But I think growth can still occur without the trend toward oligarchic or feudal society, and in fact a society with a vibrant economy would have more growth than we do today.
he makes enough odd claims about cities and countries in the beginning that i can only assume aren't really meant to be taken seriously, so i'm at a bit of a loss for how i should be reading this
> I believe that Silicon Valley possesses plenty of virtues. To start, it is the most meritocratic part of America.
Oh come on, this is so untrue. Silicon Valley loves credentialism and networking, probably more than anywhere else. Except the credentials are the companies you’ve worked for or whether you know some founder or VC, instead of what school you went to or which degrees you have.
I went to a smaller college that the big tech firms didn’t really recruit from. I spent the first ~5 years of my career working for a couple smaller companies without much SV presence. Somehow I lucked into landing a role at a big company that almost everyone has definitely heard of. I didn’t find my coworkers to necessarily be any smarter or harder working than the people I worked with previously. But when I decided it was time to move on, companies that never gave me the time of day before were responding to my cold applies or even reaching out to _me_ to beg me to interview.
And don’t get me started on the senior leadership and execs I’ve seen absolutely run an entire business units into the ground and lose millions of dollars and cost people their jobs, only to “part ways” with the company, then immediately turn around and raise millions of dollars from the same guys whose money they just lost.
I guess I'll ask since you strongly disagree and ignoring the fact this is very reductionist: In your opinion, what is the most meritocratic part of America?
Isn’t the obvious answer that many would refute the premise of meaningful regional variation? In which case the claim isn’t that somewhere else is that place but rather than all places are substantially equivalent on this difficult to measure concept (or difference is unknown).
I think the OP was making the point that it isn't meritocratic, at least that is how it read to me: they thought people where not meaningfully different in skill level (the people at the exclusive company being comparable to everywhere else) and that where you worked was the new way to find the 'in' people, rather than what university you graduated from (saying they had job offers based purely on getting the job at the exclusive company).
You could argue that getting a job at X or Y company by itself conveys some level of skill - but if we are honest, that is just version of saying you went to Harvard.
There's lots of cliques everywhere in life, and various ways to show status, SV is definitely not immune to that.
Yes, that is what OP is saying, I'm just not very convinced. Primarily because his sample size is quite small – he says the people in his smaller, non-SV jobs were just as competent as those in the SV company, but that could mean a number of things that are not "SV isn't meritocratic". For example, it could just be that his previous colleagues were more competent than the actual national/global average, which seems probable.
note that the first chunk of the piece spends time to analogize SV to the CCP, in terms of its willingness to take attacks (of humor).
So, for your quote, a skeptical interpretation of the text may assert the author was merely praising SV in the same fashion one might appraise the party.
> Narrowness of mind is something that makes me uneasy about the tech world.
> The Bay Area has all sorts of autistic tendencies. Though Silicon Valley values the ability to move fast, the rest of society has paid more attention to instances in which tech wants to break things.
> There’s a general lack of cultural awareness in the Bay Area. It’s easy to hear at these parties that a person’s favorite nonfiction book is Seeing Like a State while their aspirationally favorite novel is Middlemarch.
It's refreshing to read someone addressing this aspect of the Mecca of the tech word.
For the reasons above the tech elites are the ones I trust the less and fear the most when they are involved in national and international politics. And I think the current state of the US is directly caused by the rise of post dot com Silicon Valley.
I have nonspecific positive associations with Dan Wang's name, so I rolled my eyes a bit but kept going when "If the Bay Area once had an impish side, it has gone the way of most hardware tinkerers and hippie communes" was followed up by "People aren’t reminiscing over some lost golden age..."
But I stopped at this:
> “AI will be either the best or the worst thing ever.” It’s a Pascal’s Wager
That's not what Pascal's wager is! Apocalyptic religion dates back more than two thousand years and Blaise Pascal lived in the 17th century! When Rosa Luxemburg said to expect "socialism or barbarism", she was not doing a Pascal's Wager! Pascal's Wager doesn't just involve infinite stakes, but also infinitesimal probabilities!
The phrase has become a thought-terminating cliche for the sort of person who wants to dismiss any claim that stakes around AI are very high, but has too many intellectual aspirations to just stop with "nothing ever happens." It's no wonder that the author finds it "hard to know what to make of" AI 2027 and says that "why they put that year in their title remains beyond me."
It's one thing to notice the commonalities between some AI doom discourse and apocalyptic religion. It's another to make this into such a thoughtless reflex that you also completely muddle your understanding of the Christian apologetics you're referencing. There's a sort of determined refusal to even grasp the arguments that an AI doomer might make, even while writing an extended meditation on AI, for which I've grown increasingly intolerant. It's 2026. Let's advance the discourse.
As a European, the commentary felt very biting and accurate. An entire continent defined by being smug about not being the USA. Where not competing is seen as a great virtue and where significant parts of the electorate are actively voting against fixing the glaringly obvious problems.
The supposed niceness of the cities also is just not true. Many European cities are awful places. Where, maybe with the exception of a few tourist areas, you will only find dirty streets, rows of old apartment building regularly smeared with graffiti, shops selling used phones and vapes and food stores competing over who can sell the cheapest, still edible Kebab.
This is such a long letter it would take me probably 3 months to write it. I would have to end my year by September and spend the rest of the year writing the letter.
>But American problems seem more fixable to me than Chinese problems
Dan still one of the sharper PRC writers, but like all analysts who moves from PRC to stateside, he used to be Canadian in China writing about China to US, now Canadian writing in US about China, Dan starts peddling Murican dynamism cope, maybe something in the water. i.e. see his his post breakneck Chinatalk interview: Humorless engineering governance can't beat very funny Trump/US governance is... certainly a take. Maybe he should do his audience a favor and elucidate why boring competent engineer government is less dynamic/resilient than lawyers other than elections can pivot fast to reduce lawyers (kek) and something something and see see pee can't pivot fast to make productive innovative libtards, since seeseepee STEM can't innovate. Because as we know fast 4 year election cycles work better than slow 5 year plans. CCP certain needs 50% more lawyers... to slow it down.
> I believe that Silicon Valley possesses plenty of virtues. To start, it is the most meritocratic part of America. Tech is so open towards immigrants that it has driven populists into a froth of rage. It remains male-heavy and practices plenty of gatekeeping. But San Francisco better embodies an ethos of openness relative to the rest of the country. Industries on the east coast — finance, media, universities, policy — tend to more carefully weigh name and pedigree.
I believe I read that 27% of the founders in the YC Spring 25 class went to an Ivy League school and 40% previously worked at a magnificent 7 company. I'm not saying this is any worse than the east coast, but so much for name and pedigree not mattering.
Northern California is what it always has been: the barrier wall of manifest destiny, where instead of crossing the ocean the pioneers and all subsequent generations stayed to incubate the same incentives, and have been relentlessly in pursuit of the next gold rush. Gold, yellow journalism, semiconductors, personal computing, SaaS, crypto, AI, etc. It's the sink drain attractor of people looking to improve their fortunes in one way or another, but almost always around some kind of bonanza of concentrated opportunity. The concept of it being "meritocratic" is a rephrasing of ideology that's always existed about the region: you too could get rich here. But I don't really see any difference in the networks of power that exist in SV as do the rest of the country.
I grew up in the bay area and am far happier living outside it. I'm happier to be in a place where art and the humanities are valued instead of cast aside as immaterial or silly or a distraction. I'm happier to live in a place where people have varied interests instead of orienting their life around whatever the prevailing Big Thing is.
> So the 20-year-olds who accompanied Mr. Musk into the Department of Government Efficiency did not, I would say, distinguish themselves with their judiciousness. The Bay Area has all sorts of autistic tendencies. Though Silicon Valley values the ability to move fast, the rest of society has paid more attention to instances in which tech wants to break things. It is not surprising that hardcore contingents on both the left and the right have developed hostility to most everything that emerges from Silicon Valley.
I see some positive aspects as to more inclusive definitions of autism and neurodivergence, but I hate that we're at the point where "trying to get rich at all costs" is now perceived as autistic (and let's be clear: using mobile gas turbines that get people sick to generate power for AI is not "autistic"). Greed is not autistic, but of course the ideology of SV is that nobody actually cares about money there. Why else would they have apartments without furniture and piles of pizza boxes. It must be the autism.
> While critics of AI cite the spread of slop and rising power bills, AI’s architects are more focused on its potential to produce surging job losses. Anthropic chief Dario Amodei takes pains to point out that AI could push the unemployment rate to 20 percent by eviscerating white-collar work. I wonder whether this message is helping to endear his product to the public.
The animating concern of developing AI since 2015 has basically been "MAD" applied to the technology. The Bostrom book mentioned later in this article was clearly instrumental in creating this language to think about AI, as you can see many tech CEOs began getting "concerned" about AI around this time, prior to many of the big developments in AI like transformers. One of the seminal emails of OpenAI between Musk and Altman talks about starting a "Manhattan Project for AI". This was a useful concept to graft the development of these companies onto:
1. Firstly, it's a threat to investors. Get in on the ground floor or you will get left behind. We are building tomorrow's winners and losers and there are a lot of losers in the future.
2. Secondly, it leads to a natural source of government support. This is a national security concern. Fund this, guarantee the success of this, or America will lose.
On both counts, this framing seems to be working pretty well.
> One way that Silicon Valley and the Communist Party resemble each other is that both are serious, self-serious, and indeed, completely humorless.
There is a commedy show literally called Silicon Valley making fun of what's going on in the valley and everybody I know in tech loves it and appreciates the humor.
There WAS a comedy called Silicon Valley that wrapped more than 5 years ago ABOUT the valley made in Hollywood by a guy with a science background who grew up in NEW MEXICO and SAN DIEGO, featuring ACTORs, none of them actual techies from the bay area.
Right, but it’s written and produced in Hollywood, not in Silicon Valley. The Valley, so the argument goes, could not produce “Silicon Valley” the show. It provides the topic to be skewered, but it can’t skewer itself.
The beginning perfectly embodies the culture in Silicon Valley and touches on a crucial part that I notice when I visit: the complete lack of self expression or as I would put it ZERO drip.
Remove the tech, what does SF contribute to the world wrt culture? Especially when compared to other metropolitan cities: NY, London, LA, Tokyo.
How many musicians, artists, fashion designers from the Valley can you name? Even SF seems to be punching below its weight now that gentrification has forced out the producers, and (as noted in the article) the tech elite seems aggressively uninterested in patronizing art of any kind, be it opera or nightclubs.
I think most people in general have no taste. But taste is also so subjective that it’s hard to meaningfully discuss. Everyone probably thinks they have great taste.
Part of the Silicon Valley ethos (and techie ethos in general) is the rejection of fashion. Comfort over style. Casual over classy.
Even the “stealth wealth” thing that trended for a while seemed to be an expression of this. Casual wear, but really expensive.
> Part of the Silicon Valley ethos (and techie ethos in general) is the rejection of fashion. Comfort over style. Casual over classy.
This has always seemed like a fear of failure to me. Trying to dress well means exposing yourself to evaluation, comparison and the possibility of getting it wrong. The traditions and standards of fashion have accumulated over centuries and are fairly resistant to being redefined (especially by rookies), which makes success depend on external criteria and not on personal rules. Rejecting fashion altogether removes the risk of failure.
I think this is reflected in how techies are drawn to the safety of techwear, where fit and color matter less and clothing can be chosen and justified through objective criteria like weather resistance parameters.
>Lack of action due to the expectation of long timelines is one of the sins of the lawyerly society.
>But American problems seem more fixable to me than Chinese problems.
China has stayed on trajectory of improving life of its society for a long time. USA has been in decline all that time and decent accelerated after Cold War with Russia ended.
All of China's growth comes from its internal resource. Growth in the USA had been driven by exploiting other countries.
>I made clear in my book that I am drawn to pluralism as well as a broader conception of human flourishing than one that could be delivered by the Communist Party.
Pluralism had been eradicated in the western society. I can't speak freely in Canada. People get cancelled or jailed for speaking their mind in UK. US is not too far behind in that.
There is no meaningful pluralism in the West. They never make a long term plan they can follow for many years.
China has monolithic ( more so ) society with shared culture, language(s) and national identity that runs deep to the gene level. They don't don't allow foreign influence to erode it. It's much easier to make progress when people share the same long term vision and goals.
CPC is doing just fine leading the country into the future. Sure, it has a monopoly on power, but it also owns its mistakes and fixes them. Multiparty systems of the USA and the rest of the West are just two curtains on the stage, and when you draw the curtains you see the same people attending the same party.
Elected officials aim to earn as much as they can in their short stay in power. After all, they only have a few years before they get replaced, better make use of the short time you got.
China IMO has a much brighter outlook for the future
China has very limited internal natural resources. Much of their growth has been enabled by massive imports of raw materials including soybeans, fertilizer, fossil fuels, iron ore, copper ore, etc. Their prosperity and even their survival is heavily dependent on the post-WWII global free trade system. Ironically, China's expansionist foreign policy is one of several factors now causing that system to fray. In another decade they might find it's not so easy to import soybeans from Brazil and crude oil from Saudi Arabia and ores from Australia.
I share your concerns over effective loss of freedom of expression in western countries. In the USA at least cancel culture seems to be dying out and people no longer feel as obligated to be politically correct or self-censor. But the UK may be permanently lost.
They have that which matters the most - people with certain set of beliefs. That's the wealth of China, which they share generously with the West - just look at the Chinese developers and scientists that work in the West.
> USA has been in decline all that time and decent accelerated after Cold War with Russia ended.
Exactly when do you believe this decline started? I have some major concerns about the current trajectory of the USA, but it seems like nonsense to say that the US has been in decline since well before the Cold War ended.
> I can't speak freely in Canada
I wonder what it is that you want to say but can’t.
Comparing China positively against western nations and then griping about limits on freedom of speech in western nations seems suspect regardless.
> Elected officials aim to earn as much as they can in their short stay in power.
That’s true. Unelected officials can stay in power and accrue wealth for much longer than elected officials.
> Exactly when do you believe this decline started?
with 'perestroyka' in the USSR which predates end of the cold war - ever since they thought they won over communist/socialist ideas and accelerated with the breakup of the USSR
>I wonder what it is that you want to say but can’t.
Nice try, this won't provoke me.
>That’s true. Unelected officials can stay in power and accrue wealth for much longer than elected officials.
Sure, sure. The systems are setup differently but you are using the same logic for both coming from the assumption that power is used to acquire personal wealth.
For some (many) power isn't about acquisition of wealth but about responsibility, taking care of a hard chore. It's a mistake to think that Xi is in power for wealth.
I often draw a parallel with being a father. You have some power, but mostly you have responsibilities.
> ever since they thought they won over communist/socialist ideas, i.e. with the breakup of the USSR
You seem to have redefined the timeframe significantly. Previously you indicated that the decline was happening even before the end of the Cold War.
I don’t believe that this is a true statement even since the fall of the USSR, though. I’d be interested in what data or metrics this claim of decline is based on.
> Nice try, this won't provoke me.
You’re so unprovoked that you didn’t even address the concern. You could have pointed at what you believed was problematic suppression of free speech (of which there are certainly some examples in western nations) without actually divulging your apparently controversial beliefs.
Bluntly, I believe your criticism here is dishonest. Pearl clutching about apparent suppression of free speech in the west while pointing to a nation that sends ethnic Muslim minorities to reeducation camps as a better system is deeply disingenuous.
> It's a mistake to think that Xi is in power for wealth.
> I often draw a parallel with being a father. You have some power, but mostly you have responsibilities.
This is a man who refused the traditional transfer of power within the CCP and had the Chinese constitution revised so that he could remain in power. This is absolutely a man who wants power and wealth.
USA is cooked sadly, that being said being Britain 2.0 ain't too bad. pretty much all the YC companies in the past few cohorts just are desperately rent seeking, sad but true - go look urself
> Which of the tech titans are funny? In public, they tend to speak in one of two registers. The first is the blandly corporate tone we’ve come to expect when we see them dragged before Congressional hearings or fireside chats. The second leans philosophical, as they compose their features into the sort of reverie appropriate for issuing apocalyptic prophecies on AI.
This is just not accurate though? For example, this post from a tech titan might not necessarily be that funny but it's neither blandly corporate nor philosophical: https://x.com/elonmusk/status/2006548935372902751
1. Elon is not funny. He’s deeply unfunny.
2. “Tend to” is the key bit you’re missing. It “tends to” be true that titans speak in those registers, even if it is true that Elon, a titan, a does not.
London has the house prices of California and the income levels of Mississippi.
the UK is seriously broken, I always reflect on the energy generation statistics of the UK per capita
while in the US you see automated car washes, in the uk most car washes are Albanians n other immigrants etc
I spot checked some of this and from what I can find, the median salary in London is about $12k more than Mississippi, and the median house price in London is about $100k less than California.
Bear in mind that obviously the mean salary in London is going to be far higher than the median (the finance industry will skew it), while I'm not sure that's as extreme as Mississippi. Additionally median salaries reflect a lot of service jobs and similar labour. Dubai has a lower median wage than either London or Mississippi, but people don't think of it as economically broken.
Comparing California (an extremely large state that I presume has cheaper housing outside major urban areas) to a city seems a bit of a poor comparison.
I don't disagree that the UK has high energy costs.
If you’re trying to do a rebuttal, saying that wages are slightly higher than Mississippi and house prices are slightly lower than Cali doesn’t refute anything, it just serves to make the example more extreme and concrete. Look at house prices in Mississippi in relation to their income and then compare the same ratio for Cali and for London.
Also, taxes?
Dubai is absolutely economically broken lol. The city was built on cheap foreign slave labor. And the luxurious amenities of the city are only for the wealthy royal and foreigners. Their main export besides oil is the illusion of a thriving metropolis
The example I like to use to demonstrate how broken labor vs. service costs are in the UAE is to compare the price of a Big Mac meal to the price of a standard manual car wash (closer to detailing tbh).
In the UAE, a Big Mac meal costs approximately 35 AED ($10). On the other hand, a manual car wash - approx. 1-2 hours of labor - can cost you around 20 AED.
In other words, you could get almost two manual car washes for the price of a Big Mac.
Can you elaborate? I would have thought the main driver for the price of a service is the labor?
If this was meant to be a rebuttal, it wasn’t.
Compare the housing costs of London to the housing costs of San Francisco and then swap out those Bay Area salaries with your “slightly above Mississippi” wages and you’ll see why London looks so broken to people used to LA/SF/NY.
There are differences, but this is oversimplified, and market is “mostly” working. You need more money in California, for transportation, for health care. The standard is bigger houses (bigger everything) in Cali. Life might be richer, in some ways more pleasant, in London (it’s not weather though), including shorter flights to many interesting places.
From my experience the ratio of savings was similar, but the ppp of course favored US for absolute numbers.
House prices are out of wack anywhere desirable because the local income is irrelevant when non-locals are allowed to scoop up the local supply.
This is a common opinion that never actually matches the facts.
The issue is all the things blocking supply. As long as supply is blocked, prices will go up, Period
But why allow e.g. Chinese investors to buy property in SF if they aren't even going to live there?
Do they pay property taxes?
in California? With prop 13? Hardly.
Maybe but that will certainly not bring down prices for the average US citizen looking for a home.
Countries like Indonesia have banned foreigners from owning land altogether. You can apparently still own property through land-lease agreements and other arrangements, but not the land. I think they've cracked down on illegal rentals too.
House prices are only "out of wack" in areas with poor social housing programs.
Housing in Vienna is still affordable, only due to their very successful public housing programs. Public housing can be both beautiful and highly affordable if you want it to be, it's not like we don't know how to make good quality homes with lovely public amenities. It's mostly developers that want to skim on everything while selling it at the highest cost possible.
Poor system if this is the outcome: unaffordability.
I am interested in what is working in Vienna when “housing problem” is what almost every city in “the West” has or thinks it has.
To me it seems to be a combination of
- wealth inequality (eg 20/30 trillion dollars was printed and furloughed out in Covid, which funnels its way up to the holders of the most assets, seeing asset price inflation but no attempt to tax back the money printed). Repeat on different scales for unfair tax systems and poor infrastructure and and and
- urban planning (we think the ideal city is dense using seven storey or so apartment buildings and fairly aggressive anti-car (ie far less parking than seems possible) with better public transport and lots of pedestrian access. This describes almost no cities
- mortgages and other pro house incentives. You want house price inflation for decade after decade, just allow people to borrow a greater ratio against their salary — and allow married women into the workplace. Suddenly turning a mortgage limit of 2.5 x a man’s salary into 5x a dual couples salary. People bid up prices, forcing more couples to have two salaries to compete. And companies don’t have to increase salary to compensate … people combine salaries and go deeper into debt. Hell if you only had one policy weapon, forcing 2.5 borrowing against one highest paid persons salary is not a bad one. You won’t get re-elected however.
Real estate prices are out of whack everywhere. Even in places with no good jobs, low population density, and rapid depopulation, real estate prices are increasing exponentially. There are no market forces in play anymore.
London doesn't have the income level of Mississippi, although that might be true for the UK average. I'd say that the UK may be "seriously broken", but not more so than other post-industrial countries, including the US (or France, or Japan). It's just broken in different ways. E.g. life expectancy in the UK is significantly higher than in America even though they were the same in the '80s. Education levels (and measures such as literacy profficiency and skills etc.) are also significantly better in the UK than in the US. Somewhat tongue in cheek, Americans are richer but they don't seem to be putting their money to good use, as Brits are better educated and live longer.
Nobody will admit that the housing is overpriced, so they would have to be forced to do so.
This is terrible for normal people, and slightly bad for the investors, but only a crisis or organized government action can reset the damage done by decades of investment in already existing buildings.
The former is much more likely to happen.
Yes but London isn't in America so there's that.
Have you lived in the UK at all, or at least spent considerable time there?
I've lived in the UK and America, and America seems far more broken to me.
> while in the US you see automated car washes, in the uk most car washes are Albanians n other immigrants etc
Er what? I moved away from the UK in 2007 but even then the only place I or my parents washed a car was the ubiquitous petrol station automated car wash.
Is it that unimaginable things might have changed in the almost two decades since you left?
Yes, it is unimaginable that the UK has replaced most of their automated car washes with immigrants washing cars manually. I've been back there and I've still family there, it's not that different "on the ground" as it were, despite the big political changes.
I live in the UK now, have done for 40+ years and there are (still) automated car washes everywhere.
I can only think of one automated wash in my UK town, and well over 10 "Albanian" hand washes. Personally I go to the Albanians every time - they take pride in what they're doing, handle the vehicle with care and do a far, far better job than an auto wash.
No idea where OP is based but like most suggestions about the UK or London online it's bullshit. Most petrol stations have the same automated car washes they've always had. If you want your car hand washed there are lots of people doing that too, as there always have been. Like all places, the UK and/or London has plenty of issues including serious ones - but I'd still pick it over anywhere in the US regardless of salary differences.
Conversely, I've no idea where you or the parent has the idea that the UK is full of automated car washes and the OP is talking bullshit. I live in London and can think of a only a handful of the old fashioned automatic car washes.
Whereas I can get a hand carwash at pretty much any supermarket car park I land on. From a guy with a bucket and trolley to a full team of four going at it with a power wash. Tesco, Sainsbury's, wherever.
The Albanian angle feels loaded, but it's true that many of the employees do seem to be recent immigrants.
I don't see much point denying this reality, it feels a bit like trying to argue there's always been high streets full of betting shops, charity shops, vape stores and American candy shops.
London is an odd one as space is limited and the hand wash places can pop up anywhere quite easily. If I look at the more suburban place I'm from most petrol stations still have the automated ones (contactless payment now instead of the tokens). And most of the larger supermarkets there that have petrol stations still have the automated car washes too.
Income and wealth inequality! I don’t see a way out for the UK
Median wealth per adult in the UK is 176k. In the US it is only 124k.
Source: UBS Global Wealth Report 2025
Of course US does has a much higher mean wealth…
We're a wholly-owned subsidiary of America Inc., Minsk to Washington's Moscow.
The Vampire Squid has its tentacles in all our orifices, and we won't be free till we cut it off, or it dies of an obesity-related illness.
Not disagreeing but also I wonder how it compares to inequality in Britain before the US was a thing.
The core issue is that most major businesses are ultimately owned directly or indirectly abroad, largely in America, with some tapping by London-based intermediaries.
Supermarkets and shopping centres, national assets (e.g., water) the story is the same. Then there's Amazon et al.
Profit generated in this country is by and large not spent here, and is certainly not taxed adequately.
This causes inequality by short-circuiting redistributive measures, either local economic multipliers or government spending.
What gains are felt are concentrated in service sectors which facilitate global capital, concentrated in London. See OP's thoughts on legalistic societies.
It compares to inequality in England before the US was a thing, in the same way. Small elite benefiting from global plunder, vast inequality internally.
The British Empire didn't actually end. There was a hostile takeover by Washington at the end of WW2.
The UK is already close to the USA on obesity rates and catching up fast.
Meh. Everywhere has foreign investment. The economic elite of the UK owns the US as well.
I recommend Dan’s book (https://danwang.co/breakneck/) to those wanting to better understand China - and the United States.
One of the best books I read this year. I think a lot of HN readers will like it. A really balanced take on China that also digs deep into the perennial question of “why can’t we build big infrastructure projects in the US?” that comes up here quite often.
We used to build those infrastructure projects.
Well of course, and the book digs a little into the history as well, and what changed around the 1960s/70s. There is a long section on Robert Moses, for example. He draws a lot of parallels between modern China and the US in the 19th and early 20th centuries - totally different political systems, but similar “breakneck” ability to build.
+1, it's a great read.
It also defies easy summaries, but my biggest takeaways were that 1) the CCP really doesn't care about the costs any of its policies (one-child, zero COVID, etc) impose on its citizenry, and 2) that the CCP is actively preparing China for a world where it's entirely cut off from the West, because it realizes that's the price to pay for invading Taiwan.
I read the whole post. Really revealing - so much analysis but not a single mention of a global system that is reaching a singularity in wealth concentration, and maybe how that might be an important dimension to reflect on. Its like using so many words to deeply analyze the speed differentials in a car race, but not looking up to see that all the drivers are racing towards a brick wall.
A wealth singularity is not obvious at all to me, perhaps you should write an essay about it.
> If the Bay Area once had an impish side, it has gone the way of most hardware tinkerers and hippie communes.
Woz had that (still does). He was smart enough to take his winnings and bail. I think that many in SV can't fathom why, but I suspect I know exactly why.
I do remember the tech community as being full of humor and whimsy. I miss that.
As someone unfamiliar with the author, I had a deep amount of cynicism for the length of this piece... but damn, it's good, top to bottom.
I agree. At first I briefly skimmed it and thought it was going to be a puff piece on China's AI efforts (unfair of me), but a couple paragraphs caught me and I read the whole thing. I'm glad I did.
Hard disagree. How many paragraphs of fawning over the unique culture of the Bay Area must I endure before he arrives at the point?
Such gems as
> I like SF house parties, where people take off their shoes at the entrance and enter a space in which speech can be heard over music, which feels so much more civilized than descending into a loud bar in New York. It’s easy to fall into a nerdy conversation almost immediately with someone young and earnest.
In the thread "Roomba maker goes bankrupt, Chinese owner emerges" [1], I wrote about China'a hardware capability now going far beyond what US can imagine. In Dan's article;
>A rule of thumb is that it takes five years from an American, German, or Japanese automaker to dream up a new car design and launch that model on the roads; in China, it’s closer to 18 months.
Not only is China 3 - 5 times faster in terms of product launches, they would have launch it with a production scale that is at least double the output of other auto marker. If you were to put capacity into the equation as well, China is an order of magnitude faster than any competing countries, at half the cost if not even lower.
Every single year since 2022 China has added more solar power capacity than the entire US solar capacity. And they are still accelerating, with the current roadmap and trend they could install double the entire US solar power capacity in a single year by 2030.
CATL's Sodium Ion Battery is already in production and will be used by EVs and large scale energy storage by end of this year. The cost advantage of these new EV would mean there is partially zero chance EU can compete. And if EU are moaning about it now, they cant even imagine what is coming.
Thanks to AI pushing up memory and NAND price. YMTC and CXMT now have enough breathing room to catch up. If they play this right, I wont be surprised by 2035 30 - 40% of DRAM and NAND will be made by the two Chinese firms. Although judging from their past execution record I highly doubt this will happen, but expect may be 10-15% maximum.
Beyond tech, there are also other part of manufacturing that China has matched or exceeded rest of the world without being noticed by many. Lab Grown Diamond, Cosmetic Production, Agricultural Machinery, Reinforced glass etc. Their 10 years plan on agricultural improvement also come to fruition especially in terms of fruit and veg. I wont be surprised if they no long need US soy bean within 10 years time.
All in all a lot of things in China has passed escape velocity and there is no turning back. China understand US better than US understand themselves, and US doesn't even have any idea about China. I think the quote from the article sums this up pretty well.
"Beijing has been preparing for Cold War without eagerness for waging it, while the US wants to wage a Cold War without preparing for it.".
[1] https://news.ycombinator.com/item?id=46273326
China doesn't particularly need US soybeans but they're going to have to continue importing soybeans from somewhere (like Brazil or Canada) indefinitely. Like any commodity, soybeans are (somewhat) fungible. China doesn't have the right combination of arable land and cheap fertilizer necessary to be self-sufficient in soy at an economically viable cost. Of course, China's population is now declining so ironically that could increase their food security in a few decades.
Along ops reasoning, PRC will find domestic slop to feed pigs. There's already soybean replacement program in the pipelines, i.e. synthetic science + cheap power = future industrial substitutes. Because soybean conundrum is arable land (all sorts of soybean yield, lack of GMO, small plot farmer complexity mixed in), but pork prices fall under broad food (national) security so expect autarky > comparative advantage / cost when domestic pipeline in place. Like there's no reason for PRC to pay US soybean premium over Brazil, but they would because economic viability not as important.
TBH Anything strategic, expect PRC to adopt energy-to-matter to substitutes when the teach stack is figured out. Or at least have as less economic backup, i.e. PRC has unlimited cheap fertilizer (was top fertilizer producer via coal gasification) just more emission heavy. They're on way to displace all oil imports with coal to olefin/liquidation and EV. HQ steel via simply hammering energy into mid ores. All signs point they're moving towards strategic domestic abundance / autarky where they can.
that's obvious that some country with 1.5B working people will have edge in some niches, and will demonstrate tremendous growth from the bottom where they were 20 years ago.
But for global picture, if we are comparing Western World: US+Canada+EU vs China in technological domination, the picture is likely not super-clear and more complex analysis is required. Even if we consider manufacturing output, where China is supposedly global leader, we see it is 5.5T for Western world vs 4.6T for China (according to my brief google searching).
As a Brit, I struggled to get much interesting out of this considering how many times he mentions "Europe" (in that condescendingly general way that only US folks seem to manage).
He talks about "European" prospects and his trip to Denmark but then cites London as a representative example?
This almost broke my brain it felt so incoherent.
Never mind that (despite my personal wishes) we're not even part of the EU (which I assume is what he means by "Europe"). Surely he knows what an anomaly London is? It's not representative of anything except itself.
Referencing the extreme wage dispersion and severe housing pressure of London in a rant about Europe in general is a completely pointless endeavour.
He did say one thing I agree with. If you like good food, rich culture and great surroundings, "Europe" is indeed a lovely place to be for the most part.
Maybe I'll just keep that as my takeaway. It's too early in the year for doom and gloom anyway
> Never mind that (despite my personal wishes) we're not even part of the EU (which I assume is what he means by "Europe").
Nah, Americans aren’t particularly interested in which Europeans are offended by being identified as “Europeans” this week. If we say “Europe” without qualification we’re probably just talking about the continent. (And no, we don’t even use the word “continent” as a distinction within Europe, except when referring to hotel breakfasts.)
Americans don’t really have much of a concept of what European identity is, and we don’t really care (other than being grateful for a few decades of relative peace after 1,000 or so years of near constant war).
> Americans don’t really have much of a concept of what European identity is, and we don’t really care
Cool. Look, I made that comment with a lot of fondness, but if this is the case, maybe leave the European analysis to someone else..
Yeah, it was dripping with fondness.
He’s a Chinese guy in the US. He thinks in terms of large monoliths. The nuance of 40 different cultures on a small continent might be lost on him.
That’s OK.
We all have some approximation of reality in our brains which is necessarily shaped by our life experiences.
There is something very irritating seeing someone dismiss someone else on the internet using condescending therapy speak 'Thats Ok', nevermind the fact that calling him out as some ignorant Chinese guy while China has hundreds of cultures and languages, as if a Chinese person couldn't comprehend... Europe.
The way to respect isn’t through shaming people into it. It’s through demonstration of value, in this case understanding of nuance.
Instead we get an application of external logic and values which can’t be used to properly reason about the entity they’re applied to.
There’s no need for frustration. We take the stoic approach here. It’s OK. You are a product of your environment. Everything you’ve ever experienced told you this is the way to act.
Your statement here is pretty ironic.
China also has many different cultures, languages and so on for the over 1.4 billion people who live there. Why would the “nuance” of Europe be “lost” on a Chinese person?
China mostly has a single national identity, and provincial differences are way too nuanced to be mapped in the same way that country differences in Europe would be. It would be like trying to get Americans to understand that "Henan man" is a meme similar to the "Florida man" meme.
> The nuance of 40 different cultures on a small continent might be lost on him.
I don’t know about the author in particular, but Americans are generally aware of the “nuanced” European history of near constant war between rival nations, states, factions, and religions.
I think they could do a better job communicating that, but I’m glad that Americans are educated and curious about other parts of the world.
He's a Canadian in America writing about China. He writes about bloc strategic competition. EU+UK is treated as bloc in this context, individual European countries are generally irrelevant alone.
It's pretty clear he meant Europe as the continent, which London is a part of.
It's very similar to "Europeans" broadly generalizing the US as one homogenous country, assuming everyone and everything in Chicago is the same as New York or Dallas.
Source: me, a brit, who has lived and worked in UK and US.
Since I’ve lived in the UK before, I will say that yes it is not the same as continental Europe, but culturally, socially, and economically it is deeply tied into Europe, is European. One could say the same thing about Ireland—except the majority of Ireland is in the EU. Does Europe stop at the border of Northern Ireland?
Just like San Francisco and Dallas/Texas (from his article) are very different in the US, we should expect lot of differences in Europe (as others mentioned, he clubs UK with EU). Housing is a general problem for all major cities though, not sure why you think it is unique to London in the whole continent. Stockholm, Paris, Dublin, Lisbon to name a few, are pretty bad for housing in their own unique ways. Certainly shouldn't be "breaking your brain".
> Just like San Francisco and Dallas/Texas (from his article) are very different in the US, we should expect lot of differences in Europe
Dallas and San Francisco are both English speaking cities with a shared recent history of being part of the same nation. Most cities in Europe are as close as New York and Mexico City - Dallas and San Francisco is probably more analogous to Milan and Naples (different cultures, different histories, but now speak the same language and are part of the same nation).
He’s writing about China and US. Sure, you can call Europe more diverse, but still it makes sense to draw some generalizations, and I don’t think he’s far from the mark (having myself lived in EU, UK and US).
"Africa"
All, please keep the discussion civil and free of humor
As often the case with Dan's letters, a well balanced take on many issues. I particularly appreciated the thoughts on AI and (what I read) the undertone of infrastructure being the real differentiator between the US effort and China. We'll see how it plays out this year. "May you live in exciting times" etc.
from the piece:
“ the median age of the latest Y Combinator cohort is only 24, down from 30 just three years ago “
does yc publish stats to validate?
Quoted as 24 vs 30 in 2022 from one of the partners here: https://www.businessinsider.com/yc-founders-younger-under-mo...
Didn’t we just have a front page article about the average founder age increasing well beyond 30 this year? Is it a non-normal distribution or what?
Tunguz shows early 40s as the median
https://tomtunguz.com/founder-age-median-trend/
YC trends younger given what they’re looking for
Lots of explanations with power here:
- There's a hard edge to the distribution that isn't far from 24 (I'd expect relatively few sub-18-year-old YC founders, but more 31+-year-olds)
- Older founders (with more experience, larger networks and less life flexibility) aren't a good fit for incubators.
> Beijing has been preparing for Cold War without eagerness for waging it, while the US wants to wage a Cold War without preparing for it.
great line
I don't care who the next hegemon will be; US or China. But please pray, can these people tell what their next strategy is for the rest of the world after the Cold War ends. Will the next regime advance sciences further after whichever side wins the Cold War? Can't that be done without the war? US has been hegemon since last 5 or so decades; has it worked out best even ONLY for the Americans if not for the rest of the world. I will ask a very obvious question taught as a intuition pump by Daniel Dennett, "Then What? Then What? Then What?". Do these blob forces have post-Cold War steps figured out for the best of humanity, if not for whole of humanity but a national subset.
Here is a fun representation I have in my mind:
Galactic Emperor
https://www.youtube.com/watch?v=YfQbm8Wk2vU
I don't know if it's that hard to figure out, at least in the short-term. China's #1 goal should be to keep the value of their currency stable and push hard on the neoliberal expansionist path. If the United States' financialized economy starts to sag, this is China's opportunity to provide discount stability to the nations that China needs as allies.
Too bad it’s not true. China has wanted this for a long long time. They view their relative weakness vs the West as humiliating and temporary, and want to correct that by any means available.
It's not clear what the US plan even is. Move all manufacturing back home and compete with China ASAP?
The US doesn't have a plan, it has a framework. The framework allows it to be nimble in a way that centralized economies (like China) can never match. My money's on the US out-competing everyone else in the long run.
I can’t tell if this is sarcasm or if you are serious. The USA’s framework is to just wish for things to happen and then be surprised when those things don’t happen. There is basically no executing plan beyond grifting money to a few corporations because they supported the president during the election.
Seriously, and we have one of the most centrally planned economies in existence, it's just controlled by the elites rather than through democratic norms as it was during the new deal coalition.
Even if it’s a goal, it’s not a plan. The article talks about it, but Biden’s push for manufacturing wasn’t very aggressive, and Trump has basically stopped it. We’ve seen a loss in manufacturing jobs from tariffs and Trump idiotically deported Korean engineers working in local battery production plants. Simply protecting our existing companies (which are not very efficient, see shipbuilders) is not even close to enough to competing
With trump at the helm, do you think there is much of a plan?
The "US plan," is driven by the executive office. That is to say, the by the US president.
Insofar as there is any plan, the current officeholder's priorities are to project the appearance of personal power on television. If you're wondering what's going on strategically, don't go thinking that there's some grand plan, or even an intention to benefit the United States in the long term. There are some people in the cabinet who are thinking long term, but that's not universal, and that's not what they're selected for. Every action that is taken is to satisfy the president's narcissism and ego in the present moment. You have to understand the "US plan" in this light for anything coming out of the executive office to make sense.
Plan?
They don't even have a concept of a plan.
It all falls into place if you contemplate the possibility that there is no US.
There's stock market bros, kill people bros, government welfare bros and some mega business bros.
None of them want to know anything beyond my kids go to private school, get nepo baby job.
This is what humans are capable of - not just in USA, as a species. USA's 'plan' or rather inevitability is to fall apart. China will be the next power and it'll also fall apart, like USSR fell apart and USA is falling apart for the world to see.
Maybe in another few thousand years it'll be different, I doubt it. Read Plato's Republic you're above 140 IQ - it spells it all out so nicely that one you grok it, you need not know much of anything else regarding politics.
The US plan is to enrich oligarchs who are friendly with Trump and to enact white nationalist policies.
Anything beyond that is just like a kid playing an arcade game without putting any quarters in.
To my surprise I found myself reading the entire rather long piece. His thoughts on AI, San Francisco, China, and other topics, are well worth the time.
Spot on by Dan as always, especially about the decline of Europe and the rise of China.
Great read. I listened to Dan on Tyler Cowen’s podcast and found him to be a very interesting thinker. He has the air of someone who is a lot more intellectually honest than a lot of our pundits (Tyler is pretty good though, he’s not that target of this comment)
A fascinating and eye-opening read.
One of my intentions for this coming year is to critically examine and (if appropriate) alter or dispel some preconceptions I have. To that end, I'm curious about this part:
> You don’t have to convince the elites or the populace that growth is good or that entrepreneurs could be celebrated. Meanwhile in Europe, perhaps 15 percent of the electorate actively believes in degrowth. I feel it’s impossible to convince Europeans to act in their self interest.
Can someone elaborate on how growth is aligned with the general interest? To my mind, although growth could _theoretically_ lead to a "lifting all boats" improvement across the board, in practice it inevitably leads to greater concentration of wealth for the elite while the populace deals with negative externalities like pollution, congestion, and advertizing. Degrowth, on the other hand, would directly reduce those externalities; and, if imposed via progressive taxation, would have further societal benefits via funded programs.
I'd very much like to hear the counter-argument. It would be pleasant and convenient to believe that growth and industry are Good, Actually, so that I needn't feel guilty for contributing to them or for furthering my own position - but (sadly!) I can't just make myself believe something without justification.
> Can someone elaborate on how growth is aligned with the general interest?
Empirically, the past 200 years have seen high growth globally, and human well being has improved massively as a result. Life expectancy has skyrocketed, infant death, hunger have gone down to near zero, literacy has gone up, work is much more comfortable, interesting and rewarding, etc. But at a more fundamental level, our material quality of life is that of literal kings. The 1st decile poorest people in the US or Europe have much better living conditions than a king of 500 years ago. We are so lucky to benefit from this, yet we completely forgot that fact. You complain about congestion and advertizing, but with degrowth you would complain about hunger and dying from cold during winter.
>But at a more fundamental level, our material quality of life is that of literal kings.
This cannot be overstated. To wit, a Honda Accord (or equivalent mid-range car of today) is objectively superior to a Rolls Royce from the 90s in terms of amenities, engine power/efficiency, quietness, build quality, safety, etc. The same is true for quality-of-life improvements across a vast swath of consumer goods, and therefore consumer lifestyles.
Without growth, it's unlikely we'd see those improvements manifest. Carefully consider the lifestyle of someone living several decades ago. Would you honestly want to live such a lifestyle yourself? That's where degrowth likely leads. As the article says, "I feel it’s impossible to convince Europeans to act in their self interest. You can’t even convince them to adopt air conditioning in the summer."
> Carefully consider the lifestyle of someone living several decades ago. Would you honestly want to live such a lifestyle yourself?
Sure, I lived it, and it was very pleasant at the time and in many ways better than now in retrospect. e.g. always-on access to infinite content engines like YouTube, TikTok, X, Facebook, etc. is probably a net negative, both for individuals and society. I wouldn't want to go back a century or more and give up air conditioning, dishwashers, washing machines, air travel, electric lights. But a few decades, sure, in a heartbeat.
I agree, 30 years ago a working man doing 40 hours a week in a factory could still support a family on one income and expect to own a house. We hit a peak 30-40 years ago.
For all the insightful takes about everything under the Sun, Dan's cynicism and skewed view towards "Europe" are shown in this letter.
It's not that all his takes are wrong, it's the exaggeration, the doom and gloom and a somewhat dismissal or some unsolved personal issues he has with "Europeans".
The irony is not lost that Dan acts as smug and dismissal as he accuses Europeans to be.
Regarding the whole "Degrowth" thing: yes Europe has those and they found their gold in Governmental entities and they entertain the rich. But.. that's exactly what happens in the US too and Dan as knowledge as he is should know this was mostly an American academia export, he just needs to talk with some people in the very same colleges he regularly set foot into.
Also, he should take a hint when he says historically liberal societies have fared much better than autocratic ones even if those are very focused and appear to make progress very quickly. Having a few mega-bilionaires directing what the populace do or not do might not be a smart move as it sounds. We'll see when the AI musical chairs stops.
Btw, Europe has been dead and on the brink of destruction for a few centuries by now. And according to experts the EU is about to collapse 3 or 4 times a year - minimum.
Wealth inevitably concentrates in the hands of the elite no matter the economic conditions. There are plenty of failed states where all the wealth ended up in the hands of warlords and dictators.
It’s something that regularly has to be dealt with in societies separately from the economic situation.
Exactly _how_ should society deal with it, and exactly _when_ should society deal with it?
Opinions vary.
There are those who think massive concentration of wealth is not a problem at all and is just a product of healthy capitalism. Tax is theft, and individual property rights are above all else.
There are others who want some kind of communist revolution, where the entire structure of society and property ownership is changed. The workers should benefit from their work as much as the managers.
Personally, I feel like there's a middle ground to hit. We should be able to make changes to our current system in the US without needing anything too radical.
We have some good examples from the last century, such as trust busting, the New Deal, and the Great Society. These programs made major improvements without changing the country's fundamental economic system or growth trajectory.
> trust busting, the New Deal, and the Great Society.
I don't know what sea change it would take for today's GOP to even tepidly support any of these.
An electorate that looks like it will certainly vote them out if they don't change
Believing in growth just means believing that the future will be better than the past.
And believing this, is the single thing keeping the entire world running.
Germany is currently ruining itself because its stagnating economy means that it can not keep up with the rising costs for its pension system and has to increasingly raise more funds from a smaller, population which is seeing little productivity gains.
>Degrowth, on the other hand, would directly reduce those externalities; and, if imposed via progressive taxation, would have further societal benefits via funded programs.
Do you think that Germany will have social benefits at all, when the auto industry collapses. Where is the money coming from?
Economic growth has enabled mass literacy. It has created industrial agriculture, which eliminated hunger for economic reasons in all countries which practice it. Degrowth means turning our back on the single process which caused the greatest increase in human quality of life.
In the vibrant capitalist society envisioned by Joseph Schumpeter, all boats are lifted because better businesses replace incumbents, both improving products for the larger society and continually redistributing wealth. In my view, since 2008 my country (the US) has distanced itself from this policy, instead focusing on protecting incumbents for fear of loss of employment. The unpopular policy of bailouts pursued in 2008-2009 and then again during the pandemic has led to a stagnant, top-heavy economy with most of the disadvantages of capitalism and less and less of the upside.
I don't think degrowth is necessary to solve this problem, although I'm sure it has its merits. But I think growth can still occur without the trend toward oligarchic or feudal society, and in fact a society with a vibrant economy would have more growth than we do today.
he makes enough odd claims about cities and countries in the beginning that i can only assume aren't really meant to be taken seriously, so i'm at a bit of a loss for how i should be reading this
> I believe that Silicon Valley possesses plenty of virtues. To start, it is the most meritocratic part of America.
Oh come on, this is so untrue. Silicon Valley loves credentialism and networking, probably more than anywhere else. Except the credentials are the companies you’ve worked for or whether you know some founder or VC, instead of what school you went to or which degrees you have.
I went to a smaller college that the big tech firms didn’t really recruit from. I spent the first ~5 years of my career working for a couple smaller companies without much SV presence. Somehow I lucked into landing a role at a big company that almost everyone has definitely heard of. I didn’t find my coworkers to necessarily be any smarter or harder working than the people I worked with previously. But when I decided it was time to move on, companies that never gave me the time of day before were responding to my cold applies or even reaching out to _me_ to beg me to interview.
And don’t get me started on the senior leadership and execs I’ve seen absolutely run an entire business units into the ground and lose millions of dollars and cost people their jobs, only to “part ways” with the company, then immediately turn around and raise millions of dollars from the same guys whose money they just lost.
I guess I'll ask since you strongly disagree and ignoring the fact this is very reductionist: In your opinion, what is the most meritocratic part of America?
Isn’t the obvious answer that many would refute the premise of meaningful regional variation? In which case the claim isn’t that somewhere else is that place but rather than all places are substantially equivalent on this difficult to measure concept (or difference is unknown).
Judging you based on the work you've done seems... very meritocratic to me?
I think the OP was making the point that it isn't meritocratic, at least that is how it read to me: they thought people where not meaningfully different in skill level (the people at the exclusive company being comparable to everywhere else) and that where you worked was the new way to find the 'in' people, rather than what university you graduated from (saying they had job offers based purely on getting the job at the exclusive company).
You could argue that getting a job at X or Y company by itself conveys some level of skill - but if we are honest, that is just version of saying you went to Harvard.
There's lots of cliques everywhere in life, and various ways to show status, SV is definitely not immune to that.
Yes, that is what OP is saying, I'm just not very convinced. Primarily because his sample size is quite small – he says the people in his smaller, non-SV jobs were just as competent as those in the SV company, but that could mean a number of things that are not "SV isn't meritocratic". For example, it could just be that his previous colleagues were more competent than the actual national/global average, which seems probable.
note that the first chunk of the piece spends time to analogize SV to the CCP, in terms of its willingness to take attacks (of humor).
So, for your quote, a skeptical interpretation of the text may assert the author was merely praising SV in the same fashion one might appraise the party.
> Narrowness of mind is something that makes me uneasy about the tech world.
> The Bay Area has all sorts of autistic tendencies. Though Silicon Valley values the ability to move fast, the rest of society has paid more attention to instances in which tech wants to break things.
> There’s a general lack of cultural awareness in the Bay Area. It’s easy to hear at these parties that a person’s favorite nonfiction book is Seeing Like a State while their aspirationally favorite novel is Middlemarch.
It's refreshing to read someone addressing this aspect of the Mecca of the tech word.
For the reasons above the tech elites are the ones I trust the less and fear the most when they are involved in national and international politics. And I think the current state of the US is directly caused by the rise of post dot com Silicon Valley.
My copy of Breakneck arrived a few days ago and I'm rushing through the book, hard to put down, highly recommended
I have nonspecific positive associations with Dan Wang's name, so I rolled my eyes a bit but kept going when "If the Bay Area once had an impish side, it has gone the way of most hardware tinkerers and hippie communes" was followed up by "People aren’t reminiscing over some lost golden age..."
But I stopped at this:
> “AI will be either the best or the worst thing ever.” It’s a Pascal’s Wager
That's not what Pascal's wager is! Apocalyptic religion dates back more than two thousand years and Blaise Pascal lived in the 17th century! When Rosa Luxemburg said to expect "socialism or barbarism", she was not doing a Pascal's Wager! Pascal's Wager doesn't just involve infinite stakes, but also infinitesimal probabilities!
The phrase has become a thought-terminating cliche for the sort of person who wants to dismiss any claim that stakes around AI are very high, but has too many intellectual aspirations to just stop with "nothing ever happens." It's no wonder that the author finds it "hard to know what to make of" AI 2027 and says that "why they put that year in their title remains beyond me."
It's one thing to notice the commonalities between some AI doom discourse and apocalyptic religion. It's another to make this into such a thoughtless reflex that you also completely muddle your understanding of the Christian apologetics you're referencing. There's a sort of determined refusal to even grasp the arguments that an AI doomer might make, even while writing an extended meditation on AI, for which I've grown increasingly intolerant. It's 2026. Let's advance the discourse.
As a European, the commentary felt very biting and accurate. An entire continent defined by being smug about not being the USA. Where not competing is seen as a great virtue and where significant parts of the electorate are actively voting against fixing the glaringly obvious problems.
The supposed niceness of the cities also is just not true. Many European cities are awful places. Where, maybe with the exception of a few tourist areas, you will only find dirty streets, rows of old apartment building regularly smeared with graffiti, shops selling used phones and vapes and food stores competing over who can sell the cheapest, still edible Kebab.
You haven't been much around outside of Europe then.
And given what is currently coming out of the US in terms of worldwide cultural impact, I'm ok to be anti-whatever that is.
Dam Wang, good read!
This is such a long letter it would take me probably 3 months to write it. I would have to end my year by September and spend the rest of the year writing the letter.
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>But American problems seem more fixable to me than Chinese problems
Dan still one of the sharper PRC writers, but like all analysts who moves from PRC to stateside, he used to be Canadian in China writing about China to US, now Canadian writing in US about China, Dan starts peddling Murican dynamism cope, maybe something in the water. i.e. see his his post breakneck Chinatalk interview: Humorless engineering governance can't beat very funny Trump/US governance is... certainly a take. Maybe he should do his audience a favor and elucidate why boring competent engineer government is less dynamic/resilient than lawyers other than elections can pivot fast to reduce lawyers (kek) and something something and see see pee can't pivot fast to make productive innovative libtards, since seeseepee STEM can't innovate. Because as we know fast 4 year election cycles work better than slow 5 year plans. CCP certain needs 50% more lawyers... to slow it down.
Happy New year
> I believe that Silicon Valley possesses plenty of virtues. To start, it is the most meritocratic part of America. Tech is so open towards immigrants that it has driven populists into a froth of rage. It remains male-heavy and practices plenty of gatekeeping. But San Francisco better embodies an ethos of openness relative to the rest of the country. Industries on the east coast — finance, media, universities, policy — tend to more carefully weigh name and pedigree.
I believe I read that 27% of the founders in the YC Spring 25 class went to an Ivy League school and 40% previously worked at a magnificent 7 company. I'm not saying this is any worse than the east coast, but so much for name and pedigree not mattering.
Northern California is what it always has been: the barrier wall of manifest destiny, where instead of crossing the ocean the pioneers and all subsequent generations stayed to incubate the same incentives, and have been relentlessly in pursuit of the next gold rush. Gold, yellow journalism, semiconductors, personal computing, SaaS, crypto, AI, etc. It's the sink drain attractor of people looking to improve their fortunes in one way or another, but almost always around some kind of bonanza of concentrated opportunity. The concept of it being "meritocratic" is a rephrasing of ideology that's always existed about the region: you too could get rich here. But I don't really see any difference in the networks of power that exist in SV as do the rest of the country.
I grew up in the bay area and am far happier living outside it. I'm happier to be in a place where art and the humanities are valued instead of cast aside as immaterial or silly or a distraction. I'm happier to live in a place where people have varied interests instead of orienting their life around whatever the prevailing Big Thing is.
> So the 20-year-olds who accompanied Mr. Musk into the Department of Government Efficiency did not, I would say, distinguish themselves with their judiciousness. The Bay Area has all sorts of autistic tendencies. Though Silicon Valley values the ability to move fast, the rest of society has paid more attention to instances in which tech wants to break things. It is not surprising that hardcore contingents on both the left and the right have developed hostility to most everything that emerges from Silicon Valley.
I see some positive aspects as to more inclusive definitions of autism and neurodivergence, but I hate that we're at the point where "trying to get rich at all costs" is now perceived as autistic (and let's be clear: using mobile gas turbines that get people sick to generate power for AI is not "autistic"). Greed is not autistic, but of course the ideology of SV is that nobody actually cares about money there. Why else would they have apartments without furniture and piles of pizza boxes. It must be the autism.
> While critics of AI cite the spread of slop and rising power bills, AI’s architects are more focused on its potential to produce surging job losses. Anthropic chief Dario Amodei takes pains to point out that AI could push the unemployment rate to 20 percent by eviscerating white-collar work. I wonder whether this message is helping to endear his product to the public.
The animating concern of developing AI since 2015 has basically been "MAD" applied to the technology. The Bostrom book mentioned later in this article was clearly instrumental in creating this language to think about AI, as you can see many tech CEOs began getting "concerned" about AI around this time, prior to many of the big developments in AI like transformers. One of the seminal emails of OpenAI between Musk and Altman talks about starting a "Manhattan Project for AI". This was a useful concept to graft the development of these companies onto:
1. Firstly, it's a threat to investors. Get in on the ground floor or you will get left behind. We are building tomorrow's winners and losers and there are a lot of losers in the future.
2. Secondly, it leads to a natural source of government support. This is a national security concern. Fund this, guarantee the success of this, or America will lose.
On both counts, this framing seems to be working pretty well.
> One way that Silicon Valley and the Communist Party resemble each other is that both are serious, self-serious, and indeed, completely humorless.
There is a commedy show literally called Silicon Valley making fun of what's going on in the valley and everybody I know in tech loves it and appreciates the humor.
More accurate:
There WAS a comedy called Silicon Valley that wrapped more than 5 years ago ABOUT the valley made in Hollywood by a guy with a science background who grew up in NEW MEXICO and SAN DIEGO, featuring ACTORs, none of them actual techies from the bay area.
Right, but it’s written and produced in Hollywood, not in Silicon Valley. The Valley, so the argument goes, could not produce “Silicon Valley” the show. It provides the topic to be skewered, but it can’t skewer itself.
The beginning perfectly embodies the culture in Silicon Valley and touches on a crucial part that I notice when I visit: the complete lack of self expression or as I would put it ZERO drip.
Remove the tech, what does SF contribute to the world wrt culture? Especially when compared to other metropolitan cities: NY, London, LA, Tokyo.
Maybe I’m missing some nuance but are you just saying that folks in Silicon Valley aren’t cool?
How many musicians, artists, fashion designers from the Valley can you name? Even SF seems to be punching below its weight now that gentrification has forced out the producers, and (as noted in the article) the tech elite seems aggressively uninterested in patronizing art of any kind, be it opera or nightclubs.
The only problem with Silicon Valley is they just have no taste.
I think most people in general have no taste. But taste is also so subjective that it’s hard to meaningfully discuss. Everyone probably thinks they have great taste.
Part of the Silicon Valley ethos (and techie ethos in general) is the rejection of fashion. Comfort over style. Casual over classy.
Even the “stealth wealth” thing that trended for a while seemed to be an expression of this. Casual wear, but really expensive.
I think this is reflected in how techies are drawn to the safety of techwear, where fit and color matter less and clothing can be chosen and justified through objective criteria like weather resistance parameters.
>Lack of action due to the expectation of long timelines is one of the sins of the lawyerly society.
>But American problems seem more fixable to me than Chinese problems.
China has stayed on trajectory of improving life of its society for a long time. USA has been in decline all that time and decent accelerated after Cold War with Russia ended.
All of China's growth comes from its internal resource. Growth in the USA had been driven by exploiting other countries.
>I made clear in my book that I am drawn to pluralism as well as a broader conception of human flourishing than one that could be delivered by the Communist Party.
Pluralism had been eradicated in the western society. I can't speak freely in Canada. People get cancelled or jailed for speaking their mind in UK. US is not too far behind in that.
There is no meaningful pluralism in the West. They never make a long term plan they can follow for many years.
China has monolithic ( more so ) society with shared culture, language(s) and national identity that runs deep to the gene level. They don't don't allow foreign influence to erode it. It's much easier to make progress when people share the same long term vision and goals.
CPC is doing just fine leading the country into the future. Sure, it has a monopoly on power, but it also owns its mistakes and fixes them. Multiparty systems of the USA and the rest of the West are just two curtains on the stage, and when you draw the curtains you see the same people attending the same party.
Elected officials aim to earn as much as they can in their short stay in power. After all, they only have a few years before they get replaced, better make use of the short time you got.
China IMO has a much brighter outlook for the future
China has very limited internal natural resources. Much of their growth has been enabled by massive imports of raw materials including soybeans, fertilizer, fossil fuels, iron ore, copper ore, etc. Their prosperity and even their survival is heavily dependent on the post-WWII global free trade system. Ironically, China's expansionist foreign policy is one of several factors now causing that system to fray. In another decade they might find it's not so easy to import soybeans from Brazil and crude oil from Saudi Arabia and ores from Australia.
I share your concerns over effective loss of freedom of expression in western countries. In the USA at least cancel culture seems to be dying out and people no longer feel as obligated to be politically correct or self-censor. But the UK may be permanently lost.
They have that which matters the most - people with certain set of beliefs. That's the wealth of China, which they share generously with the West - just look at the Chinese developers and scientists that work in the West.
> USA has been in decline all that time and decent accelerated after Cold War with Russia ended.
Exactly when do you believe this decline started? I have some major concerns about the current trajectory of the USA, but it seems like nonsense to say that the US has been in decline since well before the Cold War ended.
> I can't speak freely in Canada
I wonder what it is that you want to say but can’t.
Comparing China positively against western nations and then griping about limits on freedom of speech in western nations seems suspect regardless.
> Elected officials aim to earn as much as they can in their short stay in power.
That’s true. Unelected officials can stay in power and accrue wealth for much longer than elected officials.
> Exactly when do you believe this decline started? with 'perestroyka' in the USSR which predates end of the cold war - ever since they thought they won over communist/socialist ideas and accelerated with the breakup of the USSR
>I wonder what it is that you want to say but can’t.
Nice try, this won't provoke me.
>That’s true. Unelected officials can stay in power and accrue wealth for much longer than elected officials.
Sure, sure. The systems are setup differently but you are using the same logic for both coming from the assumption that power is used to acquire personal wealth.
For some (many) power isn't about acquisition of wealth but about responsibility, taking care of a hard chore. It's a mistake to think that Xi is in power for wealth.
I often draw a parallel with being a father. You have some power, but mostly you have responsibilities.
> ever since they thought they won over communist/socialist ideas, i.e. with the breakup of the USSR
You seem to have redefined the timeframe significantly. Previously you indicated that the decline was happening even before the end of the Cold War.
I don’t believe that this is a true statement even since the fall of the USSR, though. I’d be interested in what data or metrics this claim of decline is based on.
> Nice try, this won't provoke me.
You’re so unprovoked that you didn’t even address the concern. You could have pointed at what you believed was problematic suppression of free speech (of which there are certainly some examples in western nations) without actually divulging your apparently controversial beliefs.
Bluntly, I believe your criticism here is dishonest. Pearl clutching about apparent suppression of free speech in the west while pointing to a nation that sends ethnic Muslim minorities to reeducation camps as a better system is deeply disingenuous.
> It's a mistake to think that Xi is in power for wealth.
> I often draw a parallel with being a father. You have some power, but mostly you have responsibilities.
This is a man who refused the traditional transfer of power within the CCP and had the Chinese constitution revised so that he could remain in power. This is absolutely a man who wants power and wealth.
You’re plainly biased.
Wait, how funny is this guy. That's an easy top 10 funny person out of nowhere in my life.
USA is cooked sadly, that being said being Britain 2.0 ain't too bad. pretty much all the YC companies in the past few cohorts just are desperately rent seeking, sad but true - go look urself
The Europe of today is the result of 400 years of brain drain. It would take generations to reverse the effects, if anyone even wanted to.
Where were the brains draining to 350 years ago?
> Which of the tech titans are funny? In public, they tend to speak in one of two registers. The first is the blandly corporate tone we’ve come to expect when we see them dragged before Congressional hearings or fireside chats. The second leans philosophical, as they compose their features into the sort of reverie appropriate for issuing apocalyptic prophecies on AI.
This is just not accurate though? For example, this post from a tech titan might not necessarily be that funny but it's neither blandly corporate nor philosophical: https://x.com/elonmusk/status/2006548935372902751
1. Elon is not funny. He’s deeply unfunny. 2. “Tend to” is the key bit you’re missing. It “tends to” be true that titans speak in those registers, even if it is true that Elon, a titan, a does not.