Wow... what a great article. China has engaged in four macro strategies all of which would seem at some point come to roost.
1) Currency Manipulation: To keep the perception of low-cost manufacturing.... however, the result would seem to be to rob the Chinese consumer of buying power.
2) Real Estate Loan Growth: well documented
3) Picking Winners/Losers in industrial policy: leading to large capital misallocations
4) Wolf diplomacy: making foreign markets wary of Chinese dependence and building a large cost in defense.
I am curious if there has been any serious economic work in modeling these topics in academia ?
Your description of the situation of the youth in China sounds, unfortunately similar to the situation of many young people in the US where I live now and in Spain, where I come from. Jobs are very hard to find, hard earned degrees are going to waste, and the expectation of doing better in the future has crashed.
Maybe the causes are deeper than China’s economic policies.
Well, social media may also have raised young people's expectations for their lives, by allowing them to compare themselves with rich people much more easily.
Even without social media youth morale would be pretty low. We don't need to compare ourselves to celebrities and influencers when we can just compare ourselves to our parents at the same stage of life.
I was making $100k as a young software engineer in the US Northeast and still couldn't afford a 1 BR condo in a mid neighborhood. I'm not sure if my parents made that much *collectively* out of college in non STEM and they could buy a 3 BR house in the 80s. Admittedly they live in the South where things have always been cheaper but there's plenty of people who wouldn't be able to buy their parents' house today at market rate. Ask anyone who was born and raised in Hawaii, most of Cali, most of Massachusetts etc.
You will need to compare yourselves genuinely with parents at same stage of life and not conflate stages or decades (and make sure you compare like-geography to like) Young starter professionals in big urban areas of NY etc. were not buying condos. They (statistically clear majority) were renting (as I did), Friends is not a documentariy. And mortgage rates for such things were high single into double digits for interest rate. the80s saw percent of urban home ownership actually decline.
So here's a somewhat (ok, considerably) long-winded alternate perspective.
My parents purchased my childhood home in 1973 for 20K. The asking price was 23K but my grandfather had enough saved up that they could simply hand them 20K in cash, and they accepted (my dad insisted on paying my grandparents back, but still, an interest-free 15-year home loan was not a bad deal).
Fifteen years later they sold it for a price in the mid $80K range. Now, my dad did perform some impressive home renovations; he finished furnishing the basement, built a deck, and put in an aboveground "peanut" pool. It was a much nicer house, as suburban Baltimore rowhomes went.
Still, those are the kinds of things that, in a stable market, might add a proper fractional amount to a house's value, not quadruple it! And 85K was actually well below average price for a home in 1988, which was approaching 150K, whereas 20K was around average in 1973. Which means that even with my parents performing substantial renovations on the house, it still failed to keep pace with the market, selling for a bit more than half the average price.
That just goes to show how much housing prices magnified in the '70s and '80s. Over the span of those two decades housing prices ballooned by a factor of around 7.5, and even adjusting for the massive inflation rate of 3.37 (between 1970 and 1990), that's around a 2.23 factor increase. In comparison, average wages pretty much tracked with the inflation rate. Meanwhile, home interest rates during that period went from the low 7% range to the high 16% range in the early '80s, down to just under 10 in 1990.
Compare that to the last 20 years where housing prices have gone from around 300K to 500K—almost exactly the rate of inflation over that period (1.65). At the same time, wages have roughly doubled and mortgage rates have gone from the high 5% range down to the high 3% range, then up to the low 7% and now back down to the high 6% range.
All of which is to say to young people, we Gen-Xers understand you better than you might think. In our lifetimes we saw houses go from something a middle class dad who'd smartly managed his finances might be able to outright buy for his daughter to something you have to take out a 30-year loan for. And that sucked.
I'm not trying to compete with you, nor am I saying you guys don't have real problems—in particular, our political culture and our institutions have been kneecapped, largely because Americans were conned, big-time, by a sprawling right-wing propaganda complex, enabled by dishonest (or in some cases, plainly stupid) pundits and influencers, and either cowardly or malignant oligarchs. And that's going to make it harder for you to address real problems in the future, because you've got powerful people invested in incompetent ideas that are only making them worse.
But the housing situation is largely a shock-and-awe story of post-COVID America. Things have gotten substantially worse since 2020, where half of that 200K price growth, as it turns out, occurred over about 2 years. Prior to that, housing prices were about $400K and rates were low. The spike in housing values that occurred between 2020 and 2022, which was understandably jarring, has since flattened, and the rate increases made in order to tame inflation are cooling.
Granted, we now have to wait for wages to catch up and we need more YIMBYism to combat the housing supply problem. So conditions are still not great at the moment for first-time homebuyers, though the story is different for existing homeowners. But there is reason to think things will get better—if only politicians don't get in the way.
And that brings us back once again to the real problem—the country is being run by incompetents. Trump is pursuing plainly inflationary policies and telling you that inflation is going down, the AI bubble which is propping up the economy could burst at any moment, and there's a strong argument that we may need a recession to wake up America to the realities of how stupidly destructive MAGA is.
In other words, America's biggest problem right now is that it's got its narrative backward. People think they voted for Trump to deal with a problem created by neoliberals and rich people, that prevented the American dream from being accessible to young people—much like how, in 2016 Trump was supposedly elected because of decades-old Rust Belt economic difficulties, long after classic Rust Belt casualties like Pittsburgh and Buffalo had retooled amd recovered.
But that was always nonsense, a caricature invented by Trump to justify his campaign. What actually happened is that people voted for Trump during a time of exceptional economic prosperity, which had been slowly building for years as America recovered from the '08 recession. As they tend to do, Americans splurged on a Republican because they could afford to, because people tend to like Republicans more in principle than in practice.
In fact the economy was so good that even Trump's incompetent mismanagement of it went largely unnoticed, because the powerful American consumer kept it moving forward even after Trump was elected—and he got undeserved credit for it. And because of that, four years later, after America went through a short rough patch of inflation such as half of us had never before experienced, due to a cataclysmic worldwide event that was affecting nearly everyone, well ... we did what nearly everyone else around the world did.
We kicked out the incumbents, in our case believing that Trump, despite hit utterly incoherent policy prescriptions, could "solve" a problem that the existing administration was already competently dealing with (despite poor messaging). So once again, it can be argued, America elected a Republican because we could afford to, because despite all the hubbub about egg prices, things were actually doing ok by 2024, with housing prices and interest rates being the only oustanding issues to be dealt with.
But whatever the reason, the reality now is clear: we elected people who pulled us off track from our remarkable recovery and are now tangibly making things worse, so that Trump's criminal oligarch friends can capitalize. And yet still they risibly claim, shamelessly lying to our faces whenever credible people question them, to be working for the American people. And that is the real tragedy of the legacy that we've left to younger generations.
In the 80s, jobs were FAR less concentrated in major urban areas, meaning that those same urban areas had a lot less price pressure.
If you can get remote work, there are plenty of very nice areas where you could afford a 3br house, not just a condo. Just depends on how wed you are to living in a big city.
True. But then I’m struggling to explain why according to median house price divided by median regional income metric California is about five times as expensive as the Great Lakes, yet has identical unemployment rate.
Because more people are trying to mush into California chasing a dream, and fewer people are trying to squeeze into Detroit for the same reason. California until recently had been growing.
And the aspirational California tech forms are pushing hard against remote work, so they can’t spread out into the rest of the state like you see with DC. The Great Lakes OTOH has plenty of underutilized housing inventory. That region had been shrinking.
Space is finite. Optimism is not. And housing prices are by definition going to be limited to the cases where someone actually either qualified for a mortgage or paid cash.
Unfortunately $100k today is probably less than $40k in the 80s inflation adjusted - and there are plenty of housing markets in the northeast that can be more affordable provided your job allows for remote work - it’s just that most people don’t want to live there …
Quick inflation adjustment calculator says $100K 2025 dollars roughly ~300k 1985 dollars to take mid-decade to mid-decade, so perhaps more like $30-35k 1985 salary which would definately have you renting circa 1985 in any North East metro, not buying a condo or house at probably something like 15-19% (allowing for first time buyer, higher-risk early-career) https://www.bankrate.com/mortgages/historical-mortgage-rates/ - avg being in the 13-15 range.
Unrealistic back-comparisons without taking into effect inflation, nor interest rates etc. seem to me a major source of highly unrealistic ideas
Actually most people are just fine living in less expensive areas. More people have been moving out of big metros than into them. Limiting factor is that some employers are resistant to remote work.
Housing is completely unaffordable for most in Ireland. Recent studies suggest it will be 2045 before supply catches up with demand. Wages are stagnant. Prices rising and outside tech and pharmaceutical (both under tariff pressure) wages for graduayes are terrible even when available. My house has appreciated in value 25per cent in 6 years and I
Paid far too much at the time. Some are f Chinas problems are not unique to it.
Though not explicit, this comes off as Americope. "Look at how poorly China is doing, actually."
I don't doubt anything said here, but, in America, we are in the mother of all glass houses.
China does have world beating companies.
China also isn't afraid to go after billionaires.
Do you really think Elon Musk would have done all the stuff with DOGE if he thought there was any possibility of the US government prosecuting him for doing something that was blatantly illegal. I don't mean at the time when Republicans control everything.
I mean no one credibly believes that, in the event of a Democrat Trifecta, they will say, "Mr. Musk, you had your people go through and fire thousands of people with no authority to do so, gained access to millions of pieces of private info, and had a merry run through government agencies. That was super illegal, and you are going to prison for it."
No.... he's a billionaire. He'll get to live happily ever after, because wealth is it it's own justification.
Also another area where China could teach the US something is drug procurement.
China has what's called the National Reimbursed Drug List (NRDL). This is a formulary of some 3000 drugs that Chinese people can get with the government paying the cost.
Before 2020, companies couldn't even ask to get their drugs on the list. Doctors across China would be surveyed for "Which drugs would you like to get reimbursed?" and then the Chinese government would invite the makers of the winning drugs to apply for reimbursement.
Starting in 2021, China allowed companies to apply directly. The companies submit their application, then the Chinese government makes two teams to evaluate it. One looks at the health economics of the drug, while the second looks at the medical effectiveness. Both teams independently come up with a suggested price. These prices are then harmonized by a third team.
This price is called the "envelope price." The Chinese government takes this price to a negotiation with the drug company (but it doesn't share it). Instead, the government says, "We believe the drug is a good drug and should be reimbursed in China. What would you like to charge for the drug?"
The company makes a price quote.
If that quote is within 10% of the envelope price or lower, then China says, "Welcome to the NRDL and the potential of 1.4 billion reimbursed patient pool."
If it is not within that price range, China says, "Try again. You get one chance"
If the second guess is not within the price range, China says, "Your drug will not be reimbursed at that price. You can still enter at this much lower price (lower than the envelope price). Take it or leave it."
Most companies take it.
Chinese drug prices are routinely 50-60% less than the launch price. The US could do something like this, we have a big enough population and a rich enough population to be price makers, not price takers, but we don't. (Insert line about how ensuring drug innovation is worth Americans paying 5x times what a German pays for the same drug)
> The point here is that Chinese people deserve better lives.
Fair enough, but how to get them better lives? I suspect that the only solutions involve pain and the CPC is trying to postpone when that pain happens.
The Democrats probably won't try to throw Elon in jail because:
1. The stuff that he did was in a fuzzy gray area that is more based on norms and precedents than hard written laws.
2. Generally firing people illegally is a civil offense and not a criminal one, and therefore he won't go to prison even if he sued and loses in court.
In China, sure they can go after billionaires, but it's not usually for the reasons you probably want it to be. They went after Jack Ma for criticizing the financial system. I think that's something that billionaires (or non billionaires) should be allowed to do, and while I can't speak for you I'll bet you agree. And even if it is easier for them to go after billionaires for the type of thing you want them to go after billionaires for, this isn't really an improvement, just a substitute of one above the law class for another - powerful government officials and their cronies. That's at least equally bad (I would argue worse). And, of course, there is a lot of overlap between the categories in China. Xi Jinping is billionaire too, and the CCP sure isn't going after him.
This is what happens when you let people who say "We're a nation, not an economy" run things. It turns out that economic growth isn't just a bunch of numbers on a chart. It's integral to people's lives.
Seems unlikely as Japan stagnated technologically. What's more likely is that a large segment of the Chinese society will be sacrificed so the winners can keep on winning -- just like what happened in China's SOE reforms from 1998-2002.
“At the beginning of the fourteenth century, Philip IV… reigned over France as absolute master. He had defeated the warrior pride of the great barons … Parliaments obeyed his orders and councils were in his pay. He numbered six other kings among his vassals, and the web of his alliances extended as far as Russia. He left no source of wealth untapped… Taxes were crushing: the police multiplied. Economic crises led to ruin and famine which, in turn, caused uprisings which were bloodily put down. Rioting ended upon the forks of the gibbet. Everyone must accept the royal authority and obey it or be broken by it.
This cruel and dispassionate prince was concerned with the ideal of the nation. Under his reign France was great and the French wretched.”
If bonds returns are low, the stock market is underdeveloped, and real estate values are flat-ish, then where is the value of the economic potential held? Is it owned by the rich via private ownership of firms? Is it owned by the state? Or is the economy undervalued from a price to earning and terminal value standpoint?
The economy is clearly quite large and can continue to produce for many years. That should be worth something. Who or what has that "worth"?
Arguably, the value depends on profit, not revenue. So if the economy is huge, but with no ability to earn profit, then the value is indeed not very high. Is this actually the case at the macro level??
Well, until this year, the stock market has continually disappointed as it seems investors predicted this from a mile away although they were often premature. Value is held in the private equity of enterprising firms and the backers either cash out during IPO or else hold billions in stock value after getting it for a discount. Normal people aren’t so bad off as well. Most middle aged and older folk hold a lot of savings and property investments which younger people should eventually inherit but it’s still a decade away as the median age is 47 and Chinese people work well into their 60s (even if the official retirement age is 58). It’s not so dire for young people as they may not earn as much as their older peers but it’s not like they have similar aspirations as young people around the world with a desire to own property and have gainful employment making them happy enough. At least that’s my understanding living in HK. There won’t be a revolution or uprising of any sort. Materially, they’re happy enough.
Hmm. Well, for average folks the point of wealth is not to pass it along to their kids. The point is to be able to afford expensive items and afford not working.
Wealth allows people to buy education for their kids and to start businesses. It also allows them to buy food (etc) when retired.
Noah's point was that a lot of average folk wealth is in real estate, which is not keeping up with inflation. This is admittedly a little odd because inflation is essentially zero. Real estate is negative.
What this means is that it is harder for people to retire and support themselves. They have to lower their standard of living or retire later or depend on help from the kids. All of these are unpleasant.
At the same time, Chinese GDP is growing at something like 5% per year. That's productive capacity that somebody owns. Somebody's wealth is going up. If it isn't average folks then it is either rich folks or the government.
This itself can be a problem because it essentially means that average folks are getting poorer on a relative basis.
Well, GDP is a measure of production, not wealth. If you spend $1 billion on rebuilding things wrecked by a hurricane, that $1 billion is counted in GDP but your country is not any wealthier than it was before the hurricane wrecked stuff. I don't know if something like that is what's happening in China, though.
The Econ 101 case against subsidies is that they cost the government (and therefore taxpayers) more than the value of the benefit to the people that buy and sell the subsidized product. If the most you'd pay for a Lego set was $10 and it cost $12 to make, you won't end up buying that Lego set, but if the government offers to pay Lego set makers $4 for each Lego set sold, they could offer to make one for you for $9, which would give them a profit of $9 + $4 - $12 = 1 and give you a consumer surplus of $10 - $9 = $1. Which means that the government just spent $4 to make both you and the Lego set maker better off by $1 each. If the point of the subsidy was to make you and the Lego set maker better off, the government could have achieved the same result by giving out $2 in cash instead of $4 in subsidies.
The economic value of an enterprise is split between its stakeholders, the owners, employees, customers, vendors, and the government (in the form of tax revenue and also geopolitical power). In the case of China it seems to be mostly going to the consumer, who is massively better off than a generation ago, and the government which is massively more powerful and able to use the Chinese industrial base as leverage.
I don't think that's right. Vendors don't have a claim on the productive capacity of a firm. Nor do customers. Employees only have a claim while they are employees. Once they retire they don't have that claim. That leaves owners and the government.
I see your point about consumer value lower prices, or more quality per yuan. Inflation is near zero, but consumers may still get benefit from being able to get a better washing machine for the same amount of money. This quality improvement can come at the expense of the owners if the firms are running at a loss. I can see that being the case for manufactured goods like washing machines. I wonder how well it works for other goods like food and education.
But there are no "claims" other than taxation. That's taken by force. But for everyone else, there's only what you can take for yourself based on supply and demand. That goes for vendors, customers, and employees all the same as owners. If a washing machine used to cost $100 and now it costs $50 the consumer has gained $50 from the economic activity of the manufacturers and that has no relation to how much profit or loss the manufacturers are making. NVIDIA is no more than a vendor to AI companies, and yet it has profited more from the AI boom than all the AI companies put together.
Say a firm buys supplies for 90 yuan and then sells a widget for $100 yuan. Who gets the 10 yuan?
The vendors and employees are actually suppliers, so their take is from the 90 yuan. The government may take 2 yuan for its services providing roads, etc. That leaves 8 yuan that belongs to the owners of the firm. Those owners _could_ be a large and diverse set of stockholders or a small set of private owners. In any case it's still a set of owners.
Customers don't get the 10 yuan either. They actually provided the 10 yuan.
That said, we can hypothesize two other scenarios. One is where the widget sells for 90 yuan. In that case there is no profit to the firm. Yes, value is accrued to the consumer. This is good for the consumer, but is bad for business because owners of capital will be reluctant to keep funding firms if they get no profit. Instead they'll invest money elsewhere. This is kind of happening and why the governments have to do the investing as a backstop. It's still bad business even for the government.
Another scenario is that the firm figures out how to make widgets cheaper. E.g. they can make the same widget with 45 yuan of supplies and sell it for 50 yuan. Or that the firm still takes in 90 yuan of supplies, but sells a much better widget for 100 yuan. In either case the consumer does get good benefit. But this runs into curved return gradients such that eventually improvements come at a slower rate, like 2% per year.
The value to the consumer has nothing to do with the company. If they buy for $100 and get $150 of use out of it the customer has an economic gain. If they get $50 use out of it, that's a loss. It makes no difference to the consumer whether the company profited $50 or lost $50 from the $100 the consumer spent. If the price of the good goes down to $80 per unit, the consumers are now gaining an extra $20 per transaction no matter what the cost structure of the supplier looks like.
Alas, China! The Chinese invented everything — except good government.
By about 3300 BP, having started roughly 2000 years behind the West, the Chinese had developed a truly magnificent civilization. By the time of the Song, Chinese society was incomparable. Yet over the past 1000 years, while the West has made vast and comparatively steady gains, China has struggled and staggered. The big difference, it seems to me, is that the West has forged better institutions. Not great institutions but better, on the whole, than any other, anytime.
Japan, amazingly, said, "We want some of that," and built for itself a set of westernish institutions that have served the society and its people well. Other societies, inspired in part by Japan's example, have done the same. Taiwan has demonstrated how a segment of Chinese society can adopt good institutions to its great benefit.
So far at least the successful institution set has always included a government that is fairly responsive to the popular will. China (excluding Taiwan) has never in its entire history managed to provide itself with such a government, not once. Unless and until it does, I see little that is hopeful for the society's long-term future.
China has surplus property, manufacturing capacity, and labour, along with deflation. The solution is beyond simple: start paying a UBI to all citizens. It will underpin the sick, disabled and elderly, as well as providing an effective wage rise for all workers without causing inflation. The extra demand will soak up the property and manufacturing overhang, increase employment, and improve the lives of all citizens, and get prices rising again. It can switch focus away from dumping goods into the rest of the world, taking pressure off other countries and improving relations. It's a win for everyone.
Taking money from people by taxation and then giving that money to other people doesn't increase demand, it just redirects it. It could, in theory, fix a glut in property, but only if:
1. There is an enormous amount of people who don't want to or are not able to buy property now but would do so if they had a bit more money
2. People who do have enough money have already bought all the property they need
3. Your UBI policy transfers enough money from group 2 to group 1 to enable them to purchase property
The impression I get is that this is not the situation in China. They have entire empty planned cities where nobody wants to live. Giving people a bit more money isn't going to get them to move to a ghost city.
Though if you redistribute income from the affluent to the poor, as I understand the terminology, it increases *demand* by moving money from investment (disproportionately by the affluent) to consumption. (Whether that would make things better is a different question.)
But what's the difference? If you give $1000 each to 100,000 people, they will go out and spend that $100 million on consumer goods. If a billionaire gets another $100 million he may invest it in a new company. That company will then spend that investment that money paying its employees and vendors to build whatever it is building. And also in the case where you gave the money directly to consumers, the companies they spend it at will use a lot of that money for their investments. So one leads to another in both directions.
New money gets injected into the economy in two ways
1. Govt. deficit spending
2. Bank Lending
The UBI would provide a third way.
It would be paid as new money to everyone, and then it could be taxed back based on other earnings. So the money went to those who need it the most.
The amount would continue to be increased until the labour market was in balance.
It would not be inflationary, it would offset the deflation due to excess capacity
As automation, AI, and humanoid robots replace workers, the UBI can continue to be raised. As it rises, some people will cut back their hours or drop out of the workforce altogether. At some point the market will return to rough balance, with most jobs filled in a reasonable time, people who want the extra money will be in paid work, and the rest will be doing other things with their life as they choose.
Without the UBI, as people lose their jobs, they lose spending power. As a result the supply chain shrinks. This would be bad for business and the people
Many people would move to the ghost cities but cannot afford to.
Again, China could easily solve this probjem
The Government could buy all the property by issuing bonds to the owners equal to their investment, so the owners don’t make a loss on sale.
The government would then have the cities as an asset.
They then offer the homes and shops in lotteries where the winners get to occupy the property for 25% of their income, up to the maximum of a normal market rent.
This would create new thriving cities at a much faster rate than normal uptake. The cities would become self generating economic hubs
If you are talking about printing money to offset a decrease in the money supply, then that could work. It's what the Fed did in response to the 2008 crisis. We didn't get much inflation because, unlike when they printed in 2020, the increase in money supply was offset by a decrease triggered by the crisis in the banking system.
> It would be paid as new money to everyone, and then it could be taxed back based on other earnings. So the money went to those who need it the most.
What you describe here isn't a third way. It's just taxing and spending and has the same effect of taking money from the people being taxed and redistributing it to the people who are on the receiving end of the spending. That could be good or bad, but it isn't fundamentally different.
It's not different. But the reality is the reverse of how most people think about government and money. They think that they pay taxes to fund the government. However, the government first creates the money they use to pay employees, suppliers and grant recipients. That money is spent by those people, boosting demand in the economy. Tax is used to take the new money back out (to avoid inflation), though usually less than is put in. This leaves the private sector with a surplus of cash that they then hold or invest.
Every dollar of Government Debt is matched by a dollar of private assets, these include cash and government bonds.
Here is an article I just wrote to suggest how China could help itself and the world:
Xi has diverted China from economic thought and growth to strengthening the Party-State at the expense of the average Chinese. Hard working society betrayed. Xi ranks among China's worst very corrupt emperors.
Is this analogous to the 'enshitification' that Doctorow talks about? You start out with something that works and spreads opportunity/knowledge, but end up in a cage that serves only a few people well?
I think Doctorow is talking about online services specifically, and how they eventually optimize for short-term profit at the expense of quality. China isn't optimizing for short-term profit, they're optimizing for their leaders' concept of national greatness -- a more long-term project.
I'm less keen than I used to be on the "enshittification" term, as isn't it a key point of Doctorow's thesis that said online services were never financially sustainable in their pre-enshittified form?
Reminds me of „Why Nations fail“. That book is based on the idea that illiberal government will kill economic growth (as my very simplified summary). So far, nobody convinced me the authors are wrong.
Bad news for all dictators , but good news for humanity.
Very interesting analysis. Couldn't help but thinking, in parts of it, that you were talking about the U.S.
Well, we did have our big real estate bubble/bust in the 2000s, and we did have a big increase in college degree completion in the years before that!
Wow... what a great article. China has engaged in four macro strategies all of which would seem at some point come to roost.
1) Currency Manipulation: To keep the perception of low-cost manufacturing.... however, the result would seem to be to rob the Chinese consumer of buying power.
2) Real Estate Loan Growth: well documented
3) Picking Winners/Losers in industrial policy: leading to large capital misallocations
4) Wolf diplomacy: making foreign markets wary of Chinese dependence and building a large cost in defense.
I am curious if there has been any serious economic work in modeling these topics in academia ?
Your description of the situation of the youth in China sounds, unfortunately similar to the situation of many young people in the US where I live now and in Spain, where I come from. Jobs are very hard to find, hard earned degrees are going to waste, and the expectation of doing better in the future has crashed.
Maybe the causes are deeper than China’s economic policies.
Well, social media may also have raised young people's expectations for their lives, by allowing them to compare themselves with rich people much more easily.
Even without social media youth morale would be pretty low. We don't need to compare ourselves to celebrities and influencers when we can just compare ourselves to our parents at the same stage of life.
I was making $100k as a young software engineer in the US Northeast and still couldn't afford a 1 BR condo in a mid neighborhood. I'm not sure if my parents made that much *collectively* out of college in non STEM and they could buy a 3 BR house in the 80s. Admittedly they live in the South where things have always been cheaper but there's plenty of people who wouldn't be able to buy their parents' house today at market rate. Ask anyone who was born and raised in Hawaii, most of Cali, most of Massachusetts etc.
You will need to compare yourselves genuinely with parents at same stage of life and not conflate stages or decades (and make sure you compare like-geography to like) Young starter professionals in big urban areas of NY etc. were not buying condos. They (statistically clear majority) were renting (as I did), Friends is not a documentariy. And mortgage rates for such things were high single into double digits for interest rate. the80s saw percent of urban home ownership actually decline.
So here's a somewhat (ok, considerably) long-winded alternate perspective.
My parents purchased my childhood home in 1973 for 20K. The asking price was 23K but my grandfather had enough saved up that they could simply hand them 20K in cash, and they accepted (my dad insisted on paying my grandparents back, but still, an interest-free 15-year home loan was not a bad deal).
Fifteen years later they sold it for a price in the mid $80K range. Now, my dad did perform some impressive home renovations; he finished furnishing the basement, built a deck, and put in an aboveground "peanut" pool. It was a much nicer house, as suburban Baltimore rowhomes went.
Still, those are the kinds of things that, in a stable market, might add a proper fractional amount to a house's value, not quadruple it! And 85K was actually well below average price for a home in 1988, which was approaching 150K, whereas 20K was around average in 1973. Which means that even with my parents performing substantial renovations on the house, it still failed to keep pace with the market, selling for a bit more than half the average price.
That just goes to show how much housing prices magnified in the '70s and '80s. Over the span of those two decades housing prices ballooned by a factor of around 7.5, and even adjusting for the massive inflation rate of 3.37 (between 1970 and 1990), that's around a 2.23 factor increase. In comparison, average wages pretty much tracked with the inflation rate. Meanwhile, home interest rates during that period went from the low 7% range to the high 16% range in the early '80s, down to just under 10 in 1990.
Compare that to the last 20 years where housing prices have gone from around 300K to 500K—almost exactly the rate of inflation over that period (1.65). At the same time, wages have roughly doubled and mortgage rates have gone from the high 5% range down to the high 3% range, then up to the low 7% and now back down to the high 6% range.
All of which is to say to young people, we Gen-Xers understand you better than you might think. In our lifetimes we saw houses go from something a middle class dad who'd smartly managed his finances might be able to outright buy for his daughter to something you have to take out a 30-year loan for. And that sucked.
I'm not trying to compete with you, nor am I saying you guys don't have real problems—in particular, our political culture and our institutions have been kneecapped, largely because Americans were conned, big-time, by a sprawling right-wing propaganda complex, enabled by dishonest (or in some cases, plainly stupid) pundits and influencers, and either cowardly or malignant oligarchs. And that's going to make it harder for you to address real problems in the future, because you've got powerful people invested in incompetent ideas that are only making them worse.
But the housing situation is largely a shock-and-awe story of post-COVID America. Things have gotten substantially worse since 2020, where half of that 200K price growth, as it turns out, occurred over about 2 years. Prior to that, housing prices were about $400K and rates were low. The spike in housing values that occurred between 2020 and 2022, which was understandably jarring, has since flattened, and the rate increases made in order to tame inflation are cooling.
Granted, we now have to wait for wages to catch up and we need more YIMBYism to combat the housing supply problem. So conditions are still not great at the moment for first-time homebuyers, though the story is different for existing homeowners. But there is reason to think things will get better—if only politicians don't get in the way.
And that brings us back once again to the real problem—the country is being run by incompetents. Trump is pursuing plainly inflationary policies and telling you that inflation is going down, the AI bubble which is propping up the economy could burst at any moment, and there's a strong argument that we may need a recession to wake up America to the realities of how stupidly destructive MAGA is.
In other words, America's biggest problem right now is that it's got its narrative backward. People think they voted for Trump to deal with a problem created by neoliberals and rich people, that prevented the American dream from being accessible to young people—much like how, in 2016 Trump was supposedly elected because of decades-old Rust Belt economic difficulties, long after classic Rust Belt casualties like Pittsburgh and Buffalo had retooled amd recovered.
But that was always nonsense, a caricature invented by Trump to justify his campaign. What actually happened is that people voted for Trump during a time of exceptional economic prosperity, which had been slowly building for years as America recovered from the '08 recession. As they tend to do, Americans splurged on a Republican because they could afford to, because people tend to like Republicans more in principle than in practice.
In fact the economy was so good that even Trump's incompetent mismanagement of it went largely unnoticed, because the powerful American consumer kept it moving forward even after Trump was elected—and he got undeserved credit for it. And because of that, four years later, after America went through a short rough patch of inflation such as half of us had never before experienced, due to a cataclysmic worldwide event that was affecting nearly everyone, well ... we did what nearly everyone else around the world did.
We kicked out the incumbents, in our case believing that Trump, despite hit utterly incoherent policy prescriptions, could "solve" a problem that the existing administration was already competently dealing with (despite poor messaging). So once again, it can be argued, America elected a Republican because we could afford to, because despite all the hubbub about egg prices, things were actually doing ok by 2024, with housing prices and interest rates being the only oustanding issues to be dealt with.
But whatever the reason, the reality now is clear: we elected people who pulled us off track from our remarkable recovery and are now tangibly making things worse, so that Trump's criminal oligarch friends can capitalize. And yet still they risibly claim, shamelessly lying to our faces whenever credible people question them, to be working for the American people. And that is the real tragedy of the legacy that we've left to younger generations.
Bravo. It might be long winded but it strikes it makes all the sense (to me at least).
In the 80s, jobs were FAR less concentrated in major urban areas, meaning that those same urban areas had a lot less price pressure.
If you can get remote work, there are plenty of very nice areas where you could afford a 3br house, not just a condo. Just depends on how wed you are to living in a big city.
True. But then I’m struggling to explain why according to median house price divided by median regional income metric California is about five times as expensive as the Great Lakes, yet has identical unemployment rate.
Because more people are trying to mush into California chasing a dream, and fewer people are trying to squeeze into Detroit for the same reason. California until recently had been growing.
And the aspirational California tech forms are pushing hard against remote work, so they can’t spread out into the rest of the state like you see with DC. The Great Lakes OTOH has plenty of underutilized housing inventory. That region had been shrinking.
Space is finite. Optimism is not. And housing prices are by definition going to be limited to the cases where someone actually either qualified for a mortgage or paid cash.
Plus...the weather!
Firms not forms. My apologies for the typo.
Unfortunately $100k today is probably less than $40k in the 80s inflation adjusted - and there are plenty of housing markets in the northeast that can be more affordable provided your job allows for remote work - it’s just that most people don’t want to live there …
Quick inflation adjustment calculator says $100K 2025 dollars roughly ~300k 1985 dollars to take mid-decade to mid-decade, so perhaps more like $30-35k 1985 salary which would definately have you renting circa 1985 in any North East metro, not buying a condo or house at probably something like 15-19% (allowing for first time buyer, higher-risk early-career) https://www.bankrate.com/mortgages/historical-mortgage-rates/ - avg being in the 13-15 range.
Unrealistic back-comparisons without taking into effect inflation, nor interest rates etc. seem to me a major source of highly unrealistic ideas
Actually most people are just fine living in less expensive areas. More people have been moving out of big metros than into them. Limiting factor is that some employers are resistant to remote work.
https://www.coopercenter.org/research/remote-work-persists-migration-continues-rural-america
Social media is not a sufficient explanation for the actual economic data.
Proposal:
- social systems naturally evolve to favor the powerful
- technological change has facilitated that evolution so that power (and wealth) are much more concentrated than they used to be.
- this is true independent of the actual political system (communism/dictator/democracy)
And what makes it worse is that they often don't even realize that the people they're comparing themselves with on social media ARE rich!
Housing is completely unaffordable for most in Ireland. Recent studies suggest it will be 2045 before supply catches up with demand. Wages are stagnant. Prices rising and outside tech and pharmaceutical (both under tariff pressure) wages for graduayes are terrible even when available. My house has appreciated in value 25per cent in 6 years and I
Paid far too much at the time. Some are f Chinas problems are not unique to it.
Though not explicit, this comes off as Americope. "Look at how poorly China is doing, actually."
I don't doubt anything said here, but, in America, we are in the mother of all glass houses.
China does have world beating companies.
China also isn't afraid to go after billionaires.
Do you really think Elon Musk would have done all the stuff with DOGE if he thought there was any possibility of the US government prosecuting him for doing something that was blatantly illegal. I don't mean at the time when Republicans control everything.
I mean no one credibly believes that, in the event of a Democrat Trifecta, they will say, "Mr. Musk, you had your people go through and fire thousands of people with no authority to do so, gained access to millions of pieces of private info, and had a merry run through government agencies. That was super illegal, and you are going to prison for it."
No.... he's a billionaire. He'll get to live happily ever after, because wealth is it it's own justification.
Also another area where China could teach the US something is drug procurement.
China has what's called the National Reimbursed Drug List (NRDL). This is a formulary of some 3000 drugs that Chinese people can get with the government paying the cost.
Before 2020, companies couldn't even ask to get their drugs on the list. Doctors across China would be surveyed for "Which drugs would you like to get reimbursed?" and then the Chinese government would invite the makers of the winning drugs to apply for reimbursement.
Starting in 2021, China allowed companies to apply directly. The companies submit their application, then the Chinese government makes two teams to evaluate it. One looks at the health economics of the drug, while the second looks at the medical effectiveness. Both teams independently come up with a suggested price. These prices are then harmonized by a third team.
This price is called the "envelope price." The Chinese government takes this price to a negotiation with the drug company (but it doesn't share it). Instead, the government says, "We believe the drug is a good drug and should be reimbursed in China. What would you like to charge for the drug?"
The company makes a price quote.
If that quote is within 10% of the envelope price or lower, then China says, "Welcome to the NRDL and the potential of 1.4 billion reimbursed patient pool."
If it is not within that price range, China says, "Try again. You get one chance"
If the second guess is not within the price range, China says, "Your drug will not be reimbursed at that price. You can still enter at this much lower price (lower than the envelope price). Take it or leave it."
Most companies take it.
Chinese drug prices are routinely 50-60% less than the launch price. The US could do something like this, we have a big enough population and a rich enough population to be price makers, not price takers, but we don't. (Insert line about how ensuring drug innovation is worth Americans paying 5x times what a German pays for the same drug)
Remember, the point of the "Eurocope" post was that pointing out one country's problems doesn't solve or lessen your own country's problems.
I spend a LOT of time talking about America's problems. China's own problems don't mean America's problems are any less severe.
The point of discussing China's problems has nothing to do with America. The point here is that Chinese people deserve better lives.
I mean, the title "China's people are on a treadmill" really implies that some group of people somewhere else are not on a similar treadmill.
> The point here is that Chinese people deserve better lives.
Fair enough, but how to get them better lives? I suspect that the only solutions involve pain and the CPC is trying to postpone when that pain happens.
The Democrats probably won't try to throw Elon in jail because:
1. The stuff that he did was in a fuzzy gray area that is more based on norms and precedents than hard written laws.
2. Generally firing people illegally is a civil offense and not a criminal one, and therefore he won't go to prison even if he sued and loses in court.
In China, sure they can go after billionaires, but it's not usually for the reasons you probably want it to be. They went after Jack Ma for criticizing the financial system. I think that's something that billionaires (or non billionaires) should be allowed to do, and while I can't speak for you I'll bet you agree. And even if it is easier for them to go after billionaires for the type of thing you want them to go after billionaires for, this isn't really an improvement, just a substitute of one above the law class for another - powerful government officials and their cronies. That's at least equally bad (I would argue worse). And, of course, there is a lot of overlap between the categories in China. Xi Jinping is billionaire too, and the CCP sure isn't going after him.
I am wondering if we are seeing an uptick in high skills emigration from China as a response. If not I wonder why not.
This is what happens when you let people who say "We're a nation, not an economy" run things. It turns out that economic growth isn't just a bunch of numbers on a chart. It's integral to people's lives.
Sounds a lot like Japan after their own bubble popped last century. Is China heading for a lost decade?
A lot of real estate bust share similar characteristics. As for a lost decade, that depends on how willing they are to bail everyone out...
> As for a lost decade, that depends on how willing they are to bail everyone out...
I'm curious which way this goes: Does the government bailing everybody out lead to less pain in the long run?
Seems unlikely as Japan stagnated technologically. What's more likely is that a large segment of the Chinese society will be sacrificed so the winners can keep on winning -- just like what happened in China's SOE reforms from 1998-2002.
“At the beginning of the fourteenth century, Philip IV… reigned over France as absolute master. He had defeated the warrior pride of the great barons … Parliaments obeyed his orders and councils were in his pay. He numbered six other kings among his vassals, and the web of his alliances extended as far as Russia. He left no source of wealth untapped… Taxes were crushing: the police multiplied. Economic crises led to ruin and famine which, in turn, caused uprisings which were bloodily put down. Rioting ended upon the forks of the gibbet. Everyone must accept the royal authority and obey it or be broken by it.
This cruel and dispassionate prince was concerned with the ideal of the nation. Under his reign France was great and the French wretched.”
Excerpt From
The Iron King
Maurice Druon
If bonds returns are low, the stock market is underdeveloped, and real estate values are flat-ish, then where is the value of the economic potential held? Is it owned by the rich via private ownership of firms? Is it owned by the state? Or is the economy undervalued from a price to earning and terminal value standpoint?
The economy is clearly quite large and can continue to produce for many years. That should be worth something. Who or what has that "worth"?
Arguably, the value depends on profit, not revenue. So if the economy is huge, but with no ability to earn profit, then the value is indeed not very high. Is this actually the case at the macro level??
Well, until this year, the stock market has continually disappointed as it seems investors predicted this from a mile away although they were often premature. Value is held in the private equity of enterprising firms and the backers either cash out during IPO or else hold billions in stock value after getting it for a discount. Normal people aren’t so bad off as well. Most middle aged and older folk hold a lot of savings and property investments which younger people should eventually inherit but it’s still a decade away as the median age is 47 and Chinese people work well into their 60s (even if the official retirement age is 58). It’s not so dire for young people as they may not earn as much as their older peers but it’s not like they have similar aspirations as young people around the world with a desire to own property and have gainful employment making them happy enough. At least that’s my understanding living in HK. There won’t be a revolution or uprising of any sort. Materially, they’re happy enough.
Hmm. Well, for average folks the point of wealth is not to pass it along to their kids. The point is to be able to afford expensive items and afford not working.
Wealth allows people to buy education for their kids and to start businesses. It also allows them to buy food (etc) when retired.
Noah's point was that a lot of average folk wealth is in real estate, which is not keeping up with inflation. This is admittedly a little odd because inflation is essentially zero. Real estate is negative.
What this means is that it is harder for people to retire and support themselves. They have to lower their standard of living or retire later or depend on help from the kids. All of these are unpleasant.
At the same time, Chinese GDP is growing at something like 5% per year. That's productive capacity that somebody owns. Somebody's wealth is going up. If it isn't average folks then it is either rich folks or the government.
This itself can be a problem because it essentially means that average folks are getting poorer on a relative basis.
Well, GDP is a measure of production, not wealth. If you spend $1 billion on rebuilding things wrecked by a hurricane, that $1 billion is counted in GDP but your country is not any wealthier than it was before the hurricane wrecked stuff. I don't know if something like that is what's happening in China, though.
The Econ 101 case against subsidies is that they cost the government (and therefore taxpayers) more than the value of the benefit to the people that buy and sell the subsidized product. If the most you'd pay for a Lego set was $10 and it cost $12 to make, you won't end up buying that Lego set, but if the government offers to pay Lego set makers $4 for each Lego set sold, they could offer to make one for you for $9, which would give them a profit of $9 + $4 - $12 = 1 and give you a consumer surplus of $10 - $9 = $1. Which means that the government just spent $4 to make both you and the Lego set maker better off by $1 each. If the point of the subsidy was to make you and the Lego set maker better off, the government could have achieved the same result by giving out $2 in cash instead of $4 in subsidies.
The economic value of an enterprise is split between its stakeholders, the owners, employees, customers, vendors, and the government (in the form of tax revenue and also geopolitical power). In the case of China it seems to be mostly going to the consumer, who is massively better off than a generation ago, and the government which is massively more powerful and able to use the Chinese industrial base as leverage.
I don't think that's right. Vendors don't have a claim on the productive capacity of a firm. Nor do customers. Employees only have a claim while they are employees. Once they retire they don't have that claim. That leaves owners and the government.
I see your point about consumer value lower prices, or more quality per yuan. Inflation is near zero, but consumers may still get benefit from being able to get a better washing machine for the same amount of money. This quality improvement can come at the expense of the owners if the firms are running at a loss. I can see that being the case for manufactured goods like washing machines. I wonder how well it works for other goods like food and education.
But there are no "claims" other than taxation. That's taken by force. But for everyone else, there's only what you can take for yourself based on supply and demand. That goes for vendors, customers, and employees all the same as owners. If a washing machine used to cost $100 and now it costs $50 the consumer has gained $50 from the economic activity of the manufacturers and that has no relation to how much profit or loss the manufacturers are making. NVIDIA is no more than a vendor to AI companies, and yet it has profited more from the AI boom than all the AI companies put together.
Say a firm buys supplies for 90 yuan and then sells a widget for $100 yuan. Who gets the 10 yuan?
The vendors and employees are actually suppliers, so their take is from the 90 yuan. The government may take 2 yuan for its services providing roads, etc. That leaves 8 yuan that belongs to the owners of the firm. Those owners _could_ be a large and diverse set of stockholders or a small set of private owners. In any case it's still a set of owners.
Customers don't get the 10 yuan either. They actually provided the 10 yuan.
That said, we can hypothesize two other scenarios. One is where the widget sells for 90 yuan. In that case there is no profit to the firm. Yes, value is accrued to the consumer. This is good for the consumer, but is bad for business because owners of capital will be reluctant to keep funding firms if they get no profit. Instead they'll invest money elsewhere. This is kind of happening and why the governments have to do the investing as a backstop. It's still bad business even for the government.
Another scenario is that the firm figures out how to make widgets cheaper. E.g. they can make the same widget with 45 yuan of supplies and sell it for 50 yuan. Or that the firm still takes in 90 yuan of supplies, but sells a much better widget for 100 yuan. In either case the consumer does get good benefit. But this runs into curved return gradients such that eventually improvements come at a slower rate, like 2% per year.
The value to the consumer has nothing to do with the company. If they buy for $100 and get $150 of use out of it the customer has an economic gain. If they get $50 use out of it, that's a loss. It makes no difference to the consumer whether the company profited $50 or lost $50 from the $100 the consumer spent. If the price of the good goes down to $80 per unit, the consumers are now gaining an extra $20 per transaction no matter what the cost structure of the supplier looks like.
Yeah, that's a different kind of value than I was talking about in my original question
Let them eat greatness sounds better than what we have in the US, no? Maybe not... i'm not an expert. Let me ask openAI.
What did openAI tell you?
it said it needs $1.1 trillion dollars.
Alas, China! The Chinese invented everything — except good government.
By about 3300 BP, having started roughly 2000 years behind the West, the Chinese had developed a truly magnificent civilization. By the time of the Song, Chinese society was incomparable. Yet over the past 1000 years, while the West has made vast and comparatively steady gains, China has struggled and staggered. The big difference, it seems to me, is that the West has forged better institutions. Not great institutions but better, on the whole, than any other, anytime.
Japan, amazingly, said, "We want some of that," and built for itself a set of westernish institutions that have served the society and its people well. Other societies, inspired in part by Japan's example, have done the same. Taiwan has demonstrated how a segment of Chinese society can adopt good institutions to its great benefit.
So far at least the successful institution set has always included a government that is fairly responsive to the popular will. China (excluding Taiwan) has never in its entire history managed to provide itself with such a government, not once. Unless and until it does, I see little that is hopeful for the society's long-term future.
I guess hanging on in quiet desperation is the Chinese way now too…
China has surplus property, manufacturing capacity, and labour, along with deflation. The solution is beyond simple: start paying a UBI to all citizens. It will underpin the sick, disabled and elderly, as well as providing an effective wage rise for all workers without causing inflation. The extra demand will soak up the property and manufacturing overhang, increase employment, and improve the lives of all citizens, and get prices rising again. It can switch focus away from dumping goods into the rest of the world, taking pressure off other countries and improving relations. It's a win for everyone.
Taking money from people by taxation and then giving that money to other people doesn't increase demand, it just redirects it. It could, in theory, fix a glut in property, but only if:
1. There is an enormous amount of people who don't want to or are not able to buy property now but would do so if they had a bit more money
2. People who do have enough money have already bought all the property they need
3. Your UBI policy transfers enough money from group 2 to group 1 to enable them to purchase property
The impression I get is that this is not the situation in China. They have entire empty planned cities where nobody wants to live. Giving people a bit more money isn't going to get them to move to a ghost city.
Though if you redistribute income from the affluent to the poor, as I understand the terminology, it increases *demand* by moving money from investment (disproportionately by the affluent) to consumption. (Whether that would make things better is a different question.)
But what's the difference? If you give $1000 each to 100,000 people, they will go out and spend that $100 million on consumer goods. If a billionaire gets another $100 million he may invest it in a new company. That company will then spend that investment that money paying its employees and vendors to build whatever it is building. And also in the case where you gave the money directly to consumers, the companies they spend it at will use a lot of that money for their investments. So one leads to another in both directions.
That's not how it works. See my comment below.
That’s not how it would work.
New money gets injected into the economy in two ways
1. Govt. deficit spending
2. Bank Lending
The UBI would provide a third way.
It would be paid as new money to everyone, and then it could be taxed back based on other earnings. So the money went to those who need it the most.
The amount would continue to be increased until the labour market was in balance.
It would not be inflationary, it would offset the deflation due to excess capacity
As automation, AI, and humanoid robots replace workers, the UBI can continue to be raised. As it rises, some people will cut back their hours or drop out of the workforce altogether. At some point the market will return to rough balance, with most jobs filled in a reasonable time, people who want the extra money will be in paid work, and the rest will be doing other things with their life as they choose.
Without the UBI, as people lose their jobs, they lose spending power. As a result the supply chain shrinks. This would be bad for business and the people
Many people would move to the ghost cities but cannot afford to.
Again, China could easily solve this probjem
The Government could buy all the property by issuing bonds to the owners equal to their investment, so the owners don’t make a loss on sale.
The government would then have the cities as an asset.
They then offer the homes and shops in lotteries where the winners get to occupy the property for 25% of their income, up to the maximum of a normal market rent.
This would create new thriving cities at a much faster rate than normal uptake. The cities would become self generating economic hubs
If you are talking about printing money to offset a decrease in the money supply, then that could work. It's what the Fed did in response to the 2008 crisis. We didn't get much inflation because, unlike when they printed in 2020, the increase in money supply was offset by a decrease triggered by the crisis in the banking system.
But this isn't what is happening in China. Money supply isn't dropping: https://tradingeconomics.com/china/money-supply-m2. And the central bank isn't printing: https://tradingeconomics.com/china/central-bank-balance-sheet
> It would be paid as new money to everyone, and then it could be taxed back based on other earnings. So the money went to those who need it the most.
What you describe here isn't a third way. It's just taxing and spending and has the same effect of taking money from the people being taxed and redistributing it to the people who are on the receiving end of the spending. That could be good or bad, but it isn't fundamentally different.
It's not different. But the reality is the reverse of how most people think about government and money. They think that they pay taxes to fund the government. However, the government first creates the money they use to pay employees, suppliers and grant recipients. That money is spent by those people, boosting demand in the economy. Tax is used to take the new money back out (to avoid inflation), though usually less than is put in. This leaves the private sector with a surplus of cash that they then hold or invest.
Every dollar of Government Debt is matched by a dollar of private assets, these include cash and government bonds.
Here is an article I just wrote to suggest how China could help itself and the world:
https://michaelhaines.substack.com/p/transforming-chinas-future-while?r=7x29n
Xi has diverted China from economic thought and growth to strengthening the Party-State at the expense of the average Chinese. Hard working society betrayed. Xi ranks among China's worst very corrupt emperors.
Is this analogous to the 'enshitification' that Doctorow talks about? You start out with something that works and spreads opportunity/knowledge, but end up in a cage that serves only a few people well?
I think Doctorow is talking about online services specifically, and how they eventually optimize for short-term profit at the expense of quality. China isn't optimizing for short-term profit, they're optimizing for their leaders' concept of national greatness -- a more long-term project.
I'm less keen than I used to be on the "enshittification" term, as isn't it a key point of Doctorow's thesis that said online services were never financially sustainable in their pre-enshittified form?
Reminds me of „Why Nations fail“. That book is based on the idea that illiberal government will kill economic growth (as my very simplified summary). So far, nobody convinced me the authors are wrong.
Bad news for all dictators , but good news for humanity.
I never understood why a government so afraid of its own people is the subject of so much awe.