[HN Gopher] Lessons from America's astonishing economic record
___________________________________________________________________
Lessons from America's astonishing economic record
Author : belter
Score : 63 points
Date : 2023-04-16 16:15 UTC (6 hours ago)
(HTM) web link (www.economist.com)
(TXT) w3m dump (www.economist.com)
| psychlops wrote:
| Manufacturing is noticeably absent from the list of successes.
| dauertewigkeit wrote:
| But America bet on the winning horse. Manufacturing no longer
| brings in the big bucks. We are living in the information age.
| In particular, there is only so much growth that you can have
| in a well developed industrial sector.
| nemo44x wrote:
| The USA manufactures more than it ever has. The horse we bet
| on is relying on our tech to automate much of it so factory
| workers are unbelievably productive. Whatever we can't
| automate we ship out to China, etc.
| fkcgnad wrote:
| [dead]
| jandrewrogers wrote:
| US manufacturing continues to grow almost monotonically, it is
| wildly successful. The only thing that has declined is
| manufacturing _jobs_ due to the high levels of automation used
| in American manufacturing.
| cozos wrote:
| what are some successful stories of American manufacturing?
| hollerith wrote:
| Tesla certainly. Most of Intel's fabs are in the US.
| pcrh wrote:
| SpaceX?
| lostlogin wrote:
| The arms industry?
| annoyingnoob wrote:
| Kind of ignores income inequality and that any benefits are going
| to top income earners.
|
| https://www.pewresearch.org/social-trends/2020/01/09/trends-...
|
| The article claims income-tested benefits have doubled since 1979
| and that incomes for the beneficiaries has increased. At the same
| time, earned income as a share of the economy has decreased -
| those folks need the extra benefits because they are unable to
| earn it, not for lack of trying. Life is good at the top an is
| going sideways or down at the bottom, for a long time. The
| current situation has a lot to do with Reaganomics and tax policy
| aimed at 'trickle-down' economics or generally allowing people
| with money to invest to keep more of their earnings than people
| who earn money from labor.
| ipnon wrote:
| Thomas Sowell once pointed out that billionaires are correlated
| with millionaires, and millionaires are correlated with a
| middle class. Most countries without billionaires are not great
| places to live and work. Governments without rich people to tax
| do not accomplish much in the way of welfare.
|
| Take a look at a map of countries with billionaires.[0] I would
| argue those with billionaires are much better at providing
| social welfare than those without.
|
| [0]
| https://en.wikipedia.org/wiki/List_of_countries_by_number_of...
| maxilevi wrote:
| Unrelated but why does Germany have much more billionaires
| than the rest of the EU?
| kwhitefoot wrote:
| Or: those that are are good at providing social welfare
| provide the means for people to become billionaires?
| dauertewigkeit wrote:
| What I do not like in these discussions is that there are always
| a bunch of fellow Europeans, trying to link economic success to
| economic inequality.
|
| 1. Nothing says it has to be this way, and taking the big picture
| of history in perspective, it definitely is not that way.
|
| 2. Inequality comes in many forms. Corporate and financial
| culture in Europe pretty much says that you are only allowed to
| be an entrepreneur if you are born in the right (i.e. rich)
| family. It is a much smaller club. The European corporate culture
| is also one with a much stronger hierarchy between the workers,
| the managers and the executives. In Europe, university degrees
| and other forms of bureaucracy further inhibit career progress.
| Glass ceilings are much, more prevalent everywhere, many of which
| would be illegal in the US. The salaries are lower and the taxes
| much higher. All of these are also forms of inequality. This talk
| that compares the beggar on the streets with Elon Musk is a bit
| myopic.
| jmrm wrote:
| As an European, I have to agree a lot with your vision. I might
| disagree a bit about the entrepreneurship if you also add in
| that category small business and self-employed people that does
| business outside manufacturing and tech, because there are a
| lot of those works very well and actually make a lot of
| families to progress economically.
|
| I would make even another point here: At least in Spain, the
| figure of the "angel investor" or the "venture capitalist" is
| basically non-existent to normal people who had a good idea.
| AFAIK most of them only invest in real estate, and those that
| have some tech investments only invest in projects that are
| starting to give some benefits, are made by some known person,
| or have other important investors.
|
| For those who could know more: If this isn't correct, please
| correct me. Also, I know this could be not applicable to the
| whole Europe, but I don't know at all how are business outside
| Spain.
| bjornsing wrote:
| Very good points! I'm born and raised in Sweden. It's
| supposedly very egalitarian. But I've more and more come to see
| our social norms as anti-egalitarian in that they prevent
| equality of opportunity and promote the status quo. Honestly I
| think American culture is much more egalitarian at its core.
| ttul wrote:
| TL;DR America owes its success to a relatively young population
| with high immigration, flexible labour laws, deep capital
| markets, and a swift and efficient bankruptcy process. But
| sclerotic politics threatens to derail this progress,
| particularly given the threats of climate change and China.
| Please stay the course and don't forget how you got so rich,
| basically.
| silexia wrote:
| Freedom (less government bureaucracy, regulation, and
| interference) is the major advantage America has over other
| nations. Politicians try to gain more power by scaring people,
| but the gov has a terrible track record of making promises it
| never keeps, but also never returning powers it has taken.
| nosianu wrote:
| It is to a large degree government policies that drive US
| success. For example, the steps taken for energy independence
| (and then some), or moving manufacturing back, and support
| future tech - see the current disagreements with Europe about
| trade, or how they supported private space companies. There is
| soooooo much policies stuff going on that gets lost in the
| headlines about more visible things, fortunately, on this very
| website alone I get to see a g glimpse occasionally. The rest I
| see when I follow other headlines, such as the mentioned trade
| disagreements.
|
| You can see the hand of the US government in a lot of business
| places, trade, subsidies, it's trillions being moved in support
| of US business interests. And I like what I see a lot more than
| what I see here in Europe, and I notice that no matter who's
| president, these things happen regardless.
|
| https://www.wsj.com/articles/american-manufacturing-factory-...
|
| https://www.bloomberg.com/news/articles/2023-04-03/us-and-eu...
|
| The investments into chip manufacturing too, they cost so much
| this always has to happen with loads of government support,
| directly and indirectly.
|
| https://www.commerce.gov/news/press-releases/2023/02/biden-h...
|
| https://www.reuters.com/technology/us-require-companies-winn...
|
| > _$52-billion U.S. semiconductor manufacturing and research
| program_
|
| You can keep blaming "inept government", but without it the US
| would be an insignificant backwater. Always and everywhere,
| since long before industrial revolution, business and
| government had always had to work hand in hand to create
| success. England did it, in support of the merchants, later of
| the new capitalists, Japan did it, South Korea did it, China
| did it, everybody did it. Very early even the church
| occasionally played a role, Mendel's famous beans genetic
| experiment wasn't a random fluke but part of an organized
| program in support of the textile industry, to find out the
| rules of inheritance to be able to select the right sheep more
| efficiently for more and better wool.
|
| Silicon Valley was made possible by government too:
| https://youtu.be/ZTC_RxWN_xo
| [deleted]
| swalling wrote:
| _"Average incomes have grown much faster than in western Europe
| or Japan. Also adjusted for purchasing power, they exceed $50,000
| in Mississippi, America's poorest state--higher than in France."_
|
| The article casually dismisses the counterpoint that the US
| trades high income for a lower social safety net.
|
| The average French person has a life expectancy of 82. In
| Mississippi it's 74.9, on par with Lithuania. Even Vietnam and
| Cuba have significantly higher average life expectancy than that.
| wyager wrote:
| > The average French person has a life expectancy of 82. In
| Mississippi it's 74.9
|
| Like 90% of these "gotchas" for southern states (including
| lifespan comparisons) end up decreasing or disappearing
| entirely when you condition on racial demographics. Not to say
| that invalidates the problem; just that comparing Mississippi
| to France doesn't make sense at all from a demographic
| standpoint.
| hotpotamus wrote:
| Why does race need to be brought into it?
| kwhitefoot wrote:
| Sometimes because if you add 'race' to the data then
| clusters appear that align with that extra data. Of course
| it doesn't mean that 'race' is a causal factor, it can be
| that it correlates with some other data that is not
| included such as poverty.
| wyager wrote:
| For many outcomes (including medical outcomes) the
| differences do not go away when conditioning on
| wealth/income, so if there's a separate "root" causal
| factor, we have not yet found it.
| Quarrel wrote:
| In most we have found it and it is slavery.
| wyager wrote:
| Because evidently it's a significant factor in the problem
| under consideration. It doesn't "need" to be brought into
| it unless you actually want to solve the problem.
| hotpotamus wrote:
| What does it suggest that we should do about the problem
| then?
| [deleted]
| WBrentWilliams wrote:
| In the US, race is shorthand for class. In the US, class is
| not supposed to be noticed. Race is difficult (and
| insulting) to ignore. See also:
| https://www.ucpress.edu/book/9780520261303/being-black-
| livin...
| wyager wrote:
| Many of these conditioning effects persist even when
| controlling for wealth. Evidently there are other factors
| at play. Perhaps dietary differences, differences in
| medical requirements, etc.
| WBrentWilliams wrote:
| A few confounding factors. Cross-checking and citation
| left and an exercise to the reader:
|
| Immigrants that get through the (metaphorical and
| literal) gauntlets to get into the US skew longevity via
| a Darwinian reading.
|
| Staying to any traditional diet, working with what is in
| season, has health impacts.
|
| Immigrants form communities out of necessity. Strong
| communities lead to longer lifespans and has a decrease
| on childhood deaths.
|
| None of these confounding factors corrects for the race-
| as-class indicator. They simply have a mathematical
| effect of smearing the statistics.
|
| There is a difference between wealth and class. Class
| implies wealth, not the other way around. Hence why many
| die in hospital, despite having wealth, due to their race
| implying class. This shorthand leads to many outcomes,
| including calibration of equipment problems that are
| masked by the race-implies-class effects.
| jabradoodle wrote:
| I don't think this is the defense you think it is, that
| minorities could live in such conditions they skew the
| statistics of the population is not a rebuttal.
| [deleted]
| jhbadger wrote:
| Life expectancy figures are misleading though. Many people take
| it to mean "this is how long an average elderly person is
| likely to live" but is an average of all ages at death meaning
| more young people dying brings down the number. As the article
| mentions, the primary cause for lower American life expectancy
| isn't that its old people are dying younger but rather the
| violence and drug epidemics causing more young people to die
| early.
| pcrh wrote:
| It's more likely that the "value" of income in the US is
| overestimated in international comparisons. If one compares
| not only lifespan, but also other measures of human health
| and experience, the differences between US states and
| European countries makes a little more sense, see: Top 20
| states and European countries with the highest Human
| Development Index: https://i.imgur.com/jcHhVk4.png
| swalling wrote:
| Either way the point that America is very rich but we do a
| comparatively terrible job of ensuring our people have long,
| happy lives is still true. You can pretty much apply https://
| en.wikipedia.org/wiki/%27No_Way_to_Prevent_This,%27_... to
| any phenomenon that kills lots of Americans, except cancer
| and Alzheimer's.
|
| If we are so rich, why can't we provide for the kind of
| programs that would deal with so many early deaths? Money
| should be able to deal with the issues at the very bottom of
| Maslow's hierarchy.
| RestlessMind wrote:
| I think America is very rich because it incentivizes people
| to work their asses off all the time. Or in euphemistic
| corporate jargon, American society optimizes the heck out
| of everything to appease Wall St every quarter. If they
| were to focus on long, happy lives, they would not be as
| rich in the first place.
| Jcowell wrote:
| > incentivizes
|
| Incentivize is such an interesting word in these
| conversations. This word has two sides. One side is the
| word you would use usually with children. You want to
| "incentivize" them to do their homework? Add a reward. In
| this case the incentive isn't that you're rewarded for
| hard work. It's that if you fuck up, and Fuck yo real
| bad, you can end up homeless, in debt and Ina poverty
| hole so deep you might never climb out of.
| Gareth321 wrote:
| I don't see the substantive distinction in this context. If
| people are being murdered at higher rates in the U.S., this
| lends weight to the argument that America is doing something
| wrong, socially, compared to France.
| jhbadger wrote:
| Not saying it isn't, just that the conclusions people draw,
| like that is a result of Americans being fatter than the
| French and dying of heart attacks earlier isn't really the
| primary cause.
| marianatom wrote:
| lower life expectancy in US in general can be attributed to a
| more unhealthy diet and less walking, which is on the flip side
| due to US's economic success - affordance for more food and
| richer food, as well as affordance for car as transportation.
| Another attribution is the larger amount of immigrants, which
| as a segment has lower income level and thus lower life
| expectancy
| tormeh wrote:
| Most industrialized countries have abundant food and access
| to cars. That's not the issue.
| b1ue64 wrote:
| > can be attributed to more unhealthy diet and less walking,
| which is on the flip side due to US's economic success -
| affordance for more food and richer food, as well as
| affordance for car as transportation.
|
| people in the US aren't driving because they can afford cars
| - they have to drive because they don't have any other viable
| options due to the way american cities are designed
| marianatom wrote:
| There are walkable US cities, and one can move to NY,
| Chicago, Boston, Seattle or its outskirts. However, people
| choose to stay in the suburbs because they can afford it.
| tormeh wrote:
| Isn't it the other way around? People have to stay in the
| suburbs because they can't afford to move to NYC?
| DangitBobby wrote:
| Yes. I live in the suburbs in the outskirts of a major
| city. I might consider more seriously the trade-offs of
| actually living in the city if I could justify the cost
| of living increase.
| bcrosby95 wrote:
| Chicago is the only close to affordable walkable city. As
| in, it's about the price of living in a suburb of LA.
| Which still isn't that affordable.
| bryanrasmussen wrote:
| >affordance for more food and richer food
|
| yeah, the U.S eats richer food than the French.
| marianatom wrote:
| More available produce year round. Cheaper imported food
| from around the world due to dollar's strength. More
| diverse cuisines in big cities, with a lot better Asian
| cuisines (sushi!) in general than France, due to large
| immigrations.
| bryanrasmussen wrote:
| The definition of richness in food is generally heavy in
| natural fats in proteins, high in butter and cream of a
| high quality.
|
| American butter and cream is ludicrously bad. There is
| just enough taste to it to make the stuff inedible.
|
| Sushi is not a rich food.
|
| Sauces with a lot of butter and fats in them are 'rich',
| pastries can be rich, depending mainly on the fattiness
| of the cream and butter.
|
| on edit: French cuisine is generally thought of as one of
| the richest in the world, hence my use of them as an
| example.
| lostlogin wrote:
| Corn syrup is the super weapon here.
| camillomiller wrote:
| "Richer" food? UberLOL!
|
| By what standard exactly is pathological caloric surplus
| funded by big food considered "richer"?
| marianatom wrote:
| technically a higher caloric diet is considered "richer" :)
| iudqnolq wrote:
| Actually if US immigrants were their own country they'd have
| the best life expectancy in the world. They're holding up our
| stats, not pulling them down.
|
| > In fact, the researchers say, Americans' life expectancy
| would steeply decline if it weren't for immigrants and their
| children. Under that scenario, U.S. life expectancy in 2017
| would have reverted to levels last seen in 2003 -- 74.4 years
| for men and 79.5 years for women -- more closely resembling
| the average lifespans of Tunisia and Ecuador.
|
| (data is pre-covid)
|
| https://gero.usc.edu/2021/09/30/immigration-boosts-u-s-
| life-...
| Animats wrote:
| > Actually if US immigrants were their own country they'd
| have the best life expectancy in the world. They're holding
| up our stats, not pulling them down.
|
| Of course. The sick, the halt, and the lame never made the
| trip.
|
| The kids who survive the trip through the Darien Gap will
| do fine.[1]
|
| [1] https://www.cnn.com/2023/04/13/americas/darien-gap-us-
| panama...
| neffy wrote:
| You might want to think that, but unfortunately foreign born
| Americans (immigrants) actually have significantly longer
| life expectancies than American born do.
|
| Part of the reason for that is the much higher death rate in
| infants in the US, but it is still a very hard thing to
| explain away. I will also say as somebody who has lived in
| the US, US food is high calorie, but it is not better on any
| dimension, than what I can buy in any European street market.
| Possibly foreign born Americans stick with their original
| diets more.. who knows. But ops point about trading quality
| of life for meaningless economic statistics is spot on.
| boeingUH60 wrote:
| Obesity might play a role...they're eating too much food!
| seizethecheese wrote:
| Can you propose an adjusted income metric that takes social
| programs into account?
| swalling wrote:
| The easier method to do a more nuanced analysis is to use
| data visualization where you put income on one axis and
| lifespan on another. https://www.gapminder.org/answers/how-
| does-income-relate-to-...
|
| Interesting question though. Someone's probably thought of
| this already and it's just not in wide use. Maybe something
| like annual income in dollars cut by average life expectancy?
| camillomiller wrote:
| [flagged]
| RestlessMind wrote:
| > The average French person has a life expectancy of 82. In
| Mississippi it's 74.9, on par with Lithuania.
|
| That's a great bunch of cherries you picked there. If you are
| comparing Europe to the US, comparing France and Mississippi is
| disingenuous. Compare best-to-best or worst-to-worst [1][2].
| The worst European countries are Azerbaijan (66.9), Moldova
| (70.2), Ukraine (71.2). The worst US states are W Virginia
| (74.8), Mississippi (74.9), Alabama (75.5). The best EU
| countries are Norway (83.2), Switzerland (83.1), Iceland
| (83.1). In the US, it's Hawaii (82.3), California (81.7), New
| York (81.4).
|
| In short, the best of US is somewhat worse than the best of EU.
| The worst of US is fares much better than the worst of EU.
|
| [1]
| https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...
|
| [2]
| https://en.wikipedia.org/wiki/List_of_European_countries_by_...
| badrabbit wrote:
| I had a chance to travel abroad a while back and one of the
| biggest shocks to me was not being able to buy stuff with money.
| Like it didn't matter how much money I had, the stuff was just
| not in any stores. Ok, so what can I buy? No one knows, there is
| no walmart or bestbuy you just have to go to random stores and
| even then if they do have something it's much more expensive than
| in the US(in dollars).
|
| Another shocker was how much in demand my dollars were. Everyone
| from street scammers to government officials massively tried to
| mess with me in different ways to get dollars out of me. Not
| because of exchange rates and the wealth it represents because if
| you want to buy stuff from other countries (not even the west)
| you need dollars mostly with euro and rmb also sometimes
| acceptable.
|
| I have since gotten so grateful about so many things here.
|
| But it seems no amount of wealth can cure the divisions and
| disdain groups of americans have for each other.
|
| It really scares how little americans realize just how much they
| have to lose. I work in a technical field and get paid good but
| even when I was making $9/hr I remember thinking I had all my
| bills and rent paid, I was eating and drinking what I want
| (including my choice of beer and pizza! Lol), had my own car
| (shitty car but it got the job done) and I had free time to watch
| any movie/entertainment I wanted at the time and learn stuff like
| coding and infosec to do what I liked. And right now with no
| college degree I am literally doing what I love, I spend weekends
| on work related side projects even and get paid really good.
|
| The only things I will not feel good about doing in the US is
| healthcare. If I get any serious sickness I will probablu become
| a medical tourist to mexico or thailand or something. And I had a
| glimpse into the prison and criminal punishment side of things a
| while back and it is truly terrifying. Like it was one of the
| main reasons I do all I can now to avoid driving a car, so I
| won't have to interact with the police.
|
| One thing I have learned in life is while you should always work
| to improve your situation you have to always take bad stuff with
| the good. There is no paradise on this earth.
| bjornsing wrote:
| As a European I have a feeling this is only the beginning.
| boeingUH60 wrote:
| > Also adjusted for purchasing power, they exceed $50,000 in
| Mississippi, America's poorest state--higher than in France.
|
| Damn...how does a country get so rich?
| 35208654 wrote:
| Well, being the only country left with any manufacturing after
| a catastrophic world war is one major reason.
|
| Also, navigable waterways. Transporting goods by water costs
| 1/100th what it costs to transport over land. After the US
| established a corp of engineers to dredge our waterways to make
| them passable, the ability to transport goods increased
| substantially, making internal trade extremely cheap.
| crop_rotation wrote:
| > Well, being the only country left with any manufacturing
| after a catastrophic world war is one major reason.
|
| This is not the reason. Post WW II Europe was able to rebuild
| and for a long time they had some of the biggest companies
| and for a long time EU as a whole was a bigger economy than
| the US. It's only in the last 2 decades where the US is
| significantly outpacing the EU. And there are no signs of
| slow down.
|
| WW II can not be the reason EU has few big tech companies.
| (relatively compared to the US, few exceptions always exist)
| fkcgnad wrote:
| [dead]
| smnrchrds wrote:
| > _for a long time EU as a whole was a bigger economy than
| the US. It 's only in the last 2 decades where the US is
| significantly outpacing the EU._
|
| Interesting. I couldn't find a good graph showing this. Do
| you by any chance have a graph or a source?
| pcrh wrote:
| Anyone who has spent time in both places will recognize this
| comparison as self-evidently flawed, probably for reasons
| underlying the statistical methods used.
|
| A comparison of the human development index between US States
| and European countries produces a result more in line with the
| lived reality: https://i.imgur.com/jcHhVk4.png
| pxue wrote:
| Debt. So much debt.
| Quarrel wrote:
| Another way to say this is foreign investment. So much
| foreign investment.
|
| China (and other big surplus countries) put a lot of money in
| to keeping the cost of things in the US low, due to their own
| mercantilist policies, directly at the expense of their own
| household sector.
| manojr13 wrote:
| Any level of income growth at the expense of income disparity and
| safety is not worth it. US will slowly become a net emigration
| center during this decade. The symptoms are already mushrooming.
| aksss wrote:
| Really? You are forecasting that the US will have a net loss in
| people coming in vs leaving this decade, meaning _checks watch_
| prior to 2030?
|
| I guess let's see how this ages but I can't think of any sober
| analysis that would lead me to that conclusion. Who's leaving,
| with such desire and the means to do so? Who's desirous of
| coming in? What's the strength of motivation in first group vs
| second (how much gain vs loss do each have at stake)? The
| numbers seem severely lopsided.
| awesome_dude wrote:
| This is a slap on the back for... no real reason.
|
| Sure the USA has led in some quarters, but that's more to do with
| the close of the second world war where European invented
| technologies (and the brightest creators) were confiscated (from
| Allies and Enemies). That head start encouraged more external
| talent to congregate.
|
| I have no problem with that, but this idea that it's "Labour
| laws" or any magic is about as compelling an argument as "Twitter
| or Facebook are providing their networks with the best experience
| and that's why they're so big"
|
| You can also see that China is currently getting on par and ahead
| in some areas, and that's also because they are taking knowledge
| (for free) from outside (mostly the USA). And they have terrible
| Labour laws.
| bannedbybros wrote:
| [dead]
| maxilevi wrote:
| https://archive.is/8aqVH
| non- wrote:
| Disabling Javascript on the source page works as well.
| anonu wrote:
| American declinism is a fantastic narrative which keeps
| propelling America forward. Never being satisfied and always
| wanting to do better is part of the American ethos.
|
| The linked article is the leader. I recommend reading the longer
| form briefing article as well which has lots of interesting
| information. For example, America's industrial CO2 emissions are
| down 18% from mid 2000s peaks even as industrial output is up and
| we have policy headwinds. Good news...
| non- wrote:
| > The flexibility of the labour market helps employment adapt to
| shifting patterns of demand. Already many of the workers in
| America who were laid off from Alphabet and other tech firms at
| the start of the year are applying their sought-after skills
| elsewhere, or setting up their own businesses. In continental
| Europe, by contrast, tech firms are still negotiating lay-offs,
| and may think twice about hiring there in future.
|
| This is the most interesting point made to me. Might change my
| own opinion a bit on what rights best serve workers. I can see
| how ripping the band-aid off is better for both parties, even
| though it stings, vs letting layoffs drag out over months and
| wasting everyone's time and energy.
|
| Would have been nice to see some sources cited here though.
| crop_rotation wrote:
| The European approach makes a lot of sense in other stable
| industries (Automobile/Steel). But in a fast moving quick
| changing (e.g. Tech) industries, all it does is prevent new
| risky companies from starting and making it harder for them to
| adapt. Maybe it is a good thing. But only time can tell that.
| So far to me it seems like the American approach is winning
| economy wise.
| jsnell wrote:
| Small companies are typically exempt from mass layoff
| regulations. And obviously nobody can force a failed company
| to continue operating. That should cover most of the "risky
| new company" case.
|
| Maybe there's some marginal effect in the willingness of
| established companies entering risky new business.
| [deleted]
| camillomiller wrote:
| It's also generating insane levels of inequality, so it
| really only works if you subscribe to the capitalistic
| illusion that GDP is a good indicator of the success of a
| society.
| crop_rotation wrote:
| I can see the pros of the European approach, but reducing
| equality can not be the only goal. If the economy keeps
| falling behind, the median standard of living will keep
| dropping. A strong economy can adopt higher taxes and more
| social services due to election pressures. A fallen behind
| economy will find it much harder to jump back.
|
| The other problem is that tons of European talent keeps
| going to the US. The people who have the skills to make
| higher wages might not care about inequality too much,
| since they would be the ones benefitting from it. I am not
| sure how Europe can solve that though.
| ramraj07 wrote:
| At least in the tech world calling the layoffs as
| increasing inequality is not exactly the same.
| satvikpendem wrote:
| Well, the concepts of regulated free markets, free trade
| between nations, and generally free immigration have
| created the single largest increase in human living
| standards in history.
| camillomiller wrote:
| Check your facts. As much as I am a firm European
| democrat, you might wanna see what Chinese "state driven
| capitalist communism" has done between 1975 and today.
| Again, if the measure is number of people lifted out of
| poverty, China wins hands down.
|
| Now, as much as we can't consider China's success without
| considering the lack of freedoms inscribed within the
| communist social pact, we can't take just the good of
| American capitalism by only using gdp or trade volume as
| an indicator, because - again - inequality and lack of
| basic human needs and life safety wouldn't be included.
|
| Reference: https://www.worldbank.org/en/news/press-
| release/2022/04/01/l...
| colonCapitalDee wrote:
| An alternative take would be that China only saw
| prosperity after partially adopting Western economic
| values. Additionally, Chinese economic development and
| Western economic development occurred in vastly different
| contexts. China had access to Western imports to jump
| start their industrialization and access to the Western
| scientific and policy know-how needed to build an
| advanced economy. The West had to figure things out as
| they went along. This is obviously a broad
| generalization, I just want to make the point that China
| is definitely not a slam dunk counterexample
| satvikpendem wrote:
| You're reinforcing my point. China grew so fast due to
| embracing market capitalism with Deng Xiaoping, whereas
| Mao before wanted Marxist-Leninist central planning,
| which predictably failed. There's nothing "capitalist
| communist" about it, they're not even communist at all
| since workers don't own the means of production. Now I'm
| not saying the American model is great either, but market
| capitalism is an incredible invention.
| DwnVoteHoneyPot wrote:
| Check your perspective. Taiwan, Hong Kong, Singapore,
| Japan, Korea all industrialized faster and have a higher
| standard of living than China.
|
| All did it in the 1980s - 40 years ago. All did it
| without oppressive communism.
| DaedPsyker wrote:
| While it might not have been communist, Korea certainly
| was oppressive when it built the chaebols which did
| involve a fair bit of government management.
| lostlogin wrote:
| Hong Kong has made it to oppressive communism, so that's
| going to be interesting to watch going forward (or
| backwards?).
| DwnVoteHoneyPot wrote:
| Yes for sure. From China, to free markets, back to China.
| I think we're already seeing the effects on Hong Kong. No
| so great.
| justinclift wrote:
| > single largest increase in human living standards.
|
| That's a good point. It'd be useful if the US could raise
| it's game for it's citizens, and let them participate in
| that too. :)
| Timon3 wrote:
| Economy-wise maybe, but there is more to workers rights than
| that. They also affect things like life expectancy and
| quality of life.
| bryanrasmussen wrote:
| There is no actual European approach, there are different
| levels of worker's rights across various industries and in
| different countries. In Denmark if you have been working for
| more than a month than when you are fired you have a certain
| amount of time that you get paid (unless you find a new job),
| but you still have to work for them if the company wants you
| to.
|
| In the tech industry it is generally 3 months and they don't
| want you to work during that period.
| mikepurvis wrote:
| I think "winning" really depends on your criteria for
| success. Maybe it's winning on overall metrics like GDP, but
| on an individual level, the story is far less clear.
|
| Like, is it winning to have the _option_ of starting a
| company that produces generational wealth for yourself, while
| living in a city unable to solve its homelessness problem? Is
| it winning to be a 1%-er but have no safety net so that you
| 're always precarious, at risk of being wiped out by factors
| you have no control over? Is it winning to have a school
| system so dysfunctional that you send your kids to private
| schools that most of your neighbors can't afford?
|
| I expect that from a perspective that prioritizes stability,
| safety, and sustainability, a model where it's hard to be
| fired and companies are encouraged to take long term
| responsibility for their employees (and therefore grow
| slowly) makes a lot of sense.
| Gareth321 wrote:
| > I think "winning" really depends on your criteria for
| success. Maybe it's winning on overall metrics like GDP,
| but on an individual level, the story is far less clear.
|
| This is an excellent point. America does an exceptional job
| of making rich people richer, but it also ranks poorly in
| many quality of life metrics. It is now #25 on the social
| progress index (https://www.socialprogress.org/). If people
| are richer but their children are more likely to die in
| child birth (U.S. ranks #50), or be murdered (U.S. ranks
| #137 in homicide), is that really better?
| nemo44x wrote:
| Those stats are laughable though and don't apply to the
| types of people who read those types of stats or come to
| this type of website. If you have your shit together and
| are willing to learn and apply yourself, the USA is an
| unbelievable place. If you're not then it's going to be
| more painful.
|
| My point is the USA has a very different distribution
| that's relevant.
|
| As for a "social progress index", who cares whatever that
| made up thing is. How about a better indicator like how
| many millions of people are lined up trying to live here?
| I think that's a better measurement.
| fkcgnad wrote:
| [dead]
| Joeri wrote:
| Google spoke about this:
| https://www.businessinsider.com/google-layoffs-matt-brittin-...
|
| In my country (belgium) in case of a mass layoff the employer
| has to first work together with unions to find a way to keep
| the employees on board, and when no alternative is found has to
| help the employees find a new job. Also, for workers who were
| hired long enough ago they may fall under an employment regime
| where the notice period keeps going up, and may become as much
| as 15 months. That law was changed a number of years back, but
| existing contracts were grandfathered into the old system. That
| may complicate the decision over who to fire.
| duxup wrote:
| I worked at a company who had an office in Belgium. We were
| consolidating offices. Same story ~15 months, of process.
| Offer employment elsewhere, more grace periods of where every
| employee takes the full time to consider the offer... just to
| collect a paycheck and say no.
|
| It was a mess, and in the meantime most of that office was at
| best worthless / some folks just disruptive.
|
| Many of these were capable people, highly employable, but
| they weren't productive at all during this time.
|
| I got along with some folks in that office, I really don't
| think all that time did them any good. I think the intent
| behind the laws in play at that time and how individuals used
| them was very different.
| dauertewigkeit wrote:
| It works as long as demand is high, which is true for the US
| tech job market but not so true for the EU tech job market.
| wyager wrote:
| ... which is to a large degree because hiring and firing in
| the EU is so encumbered by red tape.
| ttul wrote:
| America operates on the principal that it is better to fail
| quickly and rebuild than it is to defend what's not working to
| preserve the status quo for as long as possible. In a century
| marked by rapid technological change, it is probably better to
| hybridize the American and European approaches, allowing faster
| bankruptcies and more flexible job termination in Europe while
| also providing a more generous safety net in the US.
|
| But American progress is senselessly hobbled by a broken
| democratic model that has failed to rebalance policy making
| power toward the democratic center as people have moved into
| cities and away from the family farm. Until the country enacts
| reforms that fix this imbalance, other countries that find
| their way to greater dynamism by emulating the best of US
| policies may find they are leaping ahead of America.
|
| And many countries are well positioned to make such a move. For
| example, Canada already has free healthcare and generous family
| credits that rebalance wealth automatically to the bottom,
| promoting labour mobility. Yet it also has a flexible labour
| policy, efficient courts, excellent corporation law, and fast
| bankruptcy resolution. Add in a well designed skills-based
| immigration process and you have the recipe for something
| great. I am not saying Canada doesn't have its problems (First
| Nations reconciliation and poverty, protectionist industries
| such as Telecoms to name two), but the political system is more
| adaptable and these problems can be solved.
|
| I'm less optimistic that the US will fix its democratic
| imbalance.
| ilrwbwrkhv wrote:
| Canada's healthcare is so bad that if you are not immediately
| dying, you get no healthcare whatsoever.
| pseudo0 wrote:
| > And many countries are well positioned to make such a move.
| For example, Canada already has free healthcare and generous
| family credits that rebalance wealth automatically to the
| bottom, promoting labour mobility. Yet it also has a flexible
| labour policy, efficient courts, excellent corporation law,
| and fast bankruptcy resolution.
|
| Feel free to move to Canada if you want half the wages, twice
| as expensive housing, and a multi-year wait to get a family
| doctor. There is a reason why so many Canadians end up
| working in the US on TN or H1 visas.
| Teever wrote:
| I think you've got cause and effect backwards. Or rather,
| you don't quite realize that it's a feedback loop.
|
| Canada heavily subsidizes the healthcare and post secondary
| education of all those people who then move to the US,
| often those people move back in retirement for the
| healthcare.
|
| That no doubt has a detrimental effect on the Canadian
| economy as Canada pours resources into people and America
| reaps the benefits of that while Canada suffers.
| pseudo0 wrote:
| They generally don't move back. Anyone who qualifies for
| Medicare (10 years of employment in the US) will get
| significantly higher quality healthcare through Medicare
| than they would receive in Canada.
|
| The problem is that Canada's healthcare system is a
| command economy. The government decides how many med
| school spots there are, how many residency places, and
| how many procedures will be funded each year. In order to
| keep costs down this results in rationing. You can't even
| pay out of pocket - it is against the law for Canadians
| to purchase private care in Canada. The end result is
| that people with means end up going to the US, and
| everyone else waits 6-12 months for medically necessary
| hip or knee replacements. Even critical medical imaging
| is backed up weeks. I know someone who waited multiple
| weeks for urgent cancer screening. The same scans are
| available in the US in 24-48 hours, for a few hundred
| bucks.
| Teever wrote:
| I knew I shouldn't have included the line "often those
| people move back in retirement for the healthcare" in my
| comment because it would derail any conversation about
| the point I was trying to make.
|
| While some of the issues that Canada faces are definitely
| self inflicted as you describe, the ultimate source of
| all of Canada's problems are that it is an American
| vassal state. This relationship results in Canada
| subsidizing the development of many talented individuals
| who then make the totally rational self-interested
| decision to move to the United States where there is
| significantly more economic opportunity for them. Not
| only is this a massive drain on Canada's resources and it
| prevents Canada seeing a return on the investment that it
| makes in people who are often their brightest and best.
| roncesvalles wrote:
| I don't see how "many talented individuals make the
| totally rational self-interested decision to move to the
| United States" follows from Canada being an American
| vassal state. Doesn't this phenomenon apply to every
| country in the world? If you're born anywhere on Earth
| it's probably rational to want to make your way to the
| USA.
| polishdude20 wrote:
| Yep. I live in Canada and it just feels like our economic
| successes are due to natural resources and being close in
| location and culture to America. Couple that with the fact
| that like 80% of Canada is uninhabited. We may look big but
| we're a small population concentrated in only a few
| locations along the border.
| lostlogin wrote:
| > America operates on the principal that it is better to fail
| quickly and rebuild than it is to defend what's not working
| to preserve the status quo for as long as possible.
|
| Banks seems exempt from this. I'm not financially savvy
| enough to know if bailing out banks is good or bad.
|
| https://www.investopedia.com/articles/economics/08/governmen.
| ..
| brookst wrote:
| Utilities in general even. Nobody wants municipal water
| supplies failing quickly.
|
| But for core commercial actives it seems like a fair
| observation.
| AnimalMuppet wrote:
| No... but having them spend two decades failing slowly
| isn't the answer, either.
|
| I agree that utilities are a special case. The main point
| is that you don't want them to fail at all, ever. If they
| do fail, well, there aren't any good ways for that to
| happen.
| brookst wrote:
| Agree. I think there's a distinction between
| infrastructure that must be reliable, and first-order
| commercial enterprises that must be agile and risky.
|
| Banks are squarely on the infrastructure side. They're a
| foundation that people rely on to do the really
| interesting stuff, and as such should be 1) low risk, and
| therefore 2) not profit-maximizing.
| pxue wrote:
| Canada is an oligarchy and retirement home for the
| unproductive.
|
| I'm willing to be convinced otherwise, but this is my
| conclusion after spending 25 years growing up, living,
| working and building startups here.
| Gareth321 wrote:
| > America operates on the principal that it is better to fail
| quickly and rebuild than it is to defend what's not working
| to preserve the status quo for as long as possible. In a
| century marked by rapid technological change, it is probably
| better to hybridize the American and European approaches,
| allowing faster bankruptcies and more flexible job
| termination in Europe while also providing a more generous
| safety net in the US.
|
| This is Denmark's model and it works very well. Denmark is
| considered the easiest to do business in Europe, and #4
| globally (https://www.copcap.com/news/denmark-is-the-easiest-
| place-for....).
| ttul wrote:
| Denmark came to mind as I was writing my comment, but I am
| not well enough informed. Thanks.
| euroderf wrote:
| I'm no expert but afaik Denmark combines business
| flexibility with a decent social net. It is a dessert
| topping AND a floor wax.
| safety1st wrote:
| Labor laws in various countries tend to push companies toward
| one end or the other of a spectrum. One end of the spectrum is
| hire fast/fire fast, the other is hire slow/fire slow. The US
| is very much toward the hire fast/fire fast end of the
| spectrum, relatively speaking.
|
| For tech companies in particular hire fast/fire fast seems to
| have worked well. It creates a more competitive labor market.
| That makes sense because tech is a new industry where things
| are changing all the time, skills are evolving, so it benefits
| from a labor pool which can adapt quickly.
|
| Is it good for workers though? Many people would say it isn't
| great. You become an employee for the sake of stability and in
| a hire fast/fire fast culture, you have less of that. It's not
| so good for quality of life when you're always afraid of losing
| your job.
|
| The counter-argument is that in a situation where it's hard to
| replace people the cream doesn't necessarily rise to the top
| and there are less opportunities for top performers to get paid
| what they're worth (a common complaint in European tech). If
| you don't mind getting out there and marketing yourself and
| playing the job market aggressively, you can make a lot of
| money. If you would rather avoid all that it's a source of
| anxiety and something you want to avoid.
|
| One place where I think the US system has it wrong though, is
| in tying health care to employment. This is catastrophically
| bad from a quality of life standpoint and bad for keeping the
| labor market fluid as well because it creates perverse
| incentives which are unrelated to whether someone's actually
| good at their job or not.
|
| Overall I'm personally of the view that it's good for different
| parts of the world to have different ways of doing things, and
| if you truly can't stand the overall package you're getting on
| a particular continent, maybe you should move. (I did and I
| don't regret it. I might do it again one day. I am continually
| surprised by how many people seem to utterly hate the place
| they live, and yet don't leave it!)
| dauertewigkeit wrote:
| Your comment really highlights the absurdity of having a one-
| size-fits-all policy across the whole labour market.
|
| But ultimately I don't think it is labour laws that made it
| so that OpenAI is American and ChatGPT was developed in the
| US. That is just one aspect of a much bigger picture.
| bjornsing wrote:
| It's a bit of a chicken and egg problem I would say: labour
| laws set (or reflect) the broader workplace culture. In a
| culture where it doesn't pay (or is even frowned upon) to
| be a top performer it's very hard to build the OpenAI kind
| of org.
| alexpotato wrote:
| There was a mention in, I believe, an NPR article(or podcast)
| many years ago about Europe vs America.
|
| The main thrust was that someone from Chicago can easily start
| a job in New York with little to no cultural adjustment or
| misunderstandings.
|
| In Europe, the situation was quite different with e.g. a
| Spaniard working with Germans etc. The claim was that someone
| ended up writing a book called "Managing Spaniards if you are a
| German".
| crop_rotation wrote:
| How would Europe even compete with America in the long run.
| America just has so many advantages (massive influx of talented
| workers, one country, better equiped with natural resources, the
| supremacy of the dolllar). There are many other reasons some of
| which might not seem clear cut. The average American or European
| life requires an economy which is on average much better than the
| average for the world. If you do not have comparative advantage
| in creating valuable things compared to the rest of the world, it
| is hard to see why the living standards will keep up.
|
| The Americans might have their own problems, but they keep coming
| up with innovative products several of which which will be
| massive value producers for them. All the most valuable companies
| of the world are in US. What will the EU's comparative advantage
| be? Yes valued companies is not everything and quality of life
| median matters but in the long run what will the EU have an
| advantage at (Not just America but even Asia/ Africa).
| fkcgnad wrote:
| [dead]
| DaedPsyker wrote:
| Being from Europe, my perspective might be as biased as
| American fatalism but as the article says I think the key most
| important aspect is lacking a true single market and I'm
| sceptical of us ever achieving it.
|
| The more we fall behind the more we'll cling to tradition and
| avoid further integration, a continuous cycle.
| bobolino123 wrote:
| Why can't an European company sell to the US?
| tormeh wrote:
| > we'll cling to tradition
|
| I think this is mostly a matter of old voter bases.
| bjornsing wrote:
| > What will the EU's comparative advantage be?
|
| Europe is consolidating its position as the worlds museum.
|
| Also regulation. Lots and lots of regulation.
|
| /European dissident
| jutrewag wrote:
| Let in a lot more immigrants, and not the refugee kind. Vetted,
| high skilled immigrants. Let those immigrants have something at
| stake i.e. provide a path to citizenship. Provide automatic
| citizenship to children of those immigrants born in Europe.
| crop_rotation wrote:
| That is common sense, but saying that for some reasons gets
| lots of pushback from several people (both in Europe and
| America). People seem to forget that countries are only able
| to take modern moral stances due to their prosperity, and
| once the prosperity is not there, the voters forget morality
| in an instant.
| jutrewag wrote:
| America wouldn't be nearly as entrepreneurial without
| immigrants. Something like 50% of all unicorns currently
| have atleast one Indian immigrant co-founder. Four out of
| ten unicorns have first gen immigrant founders.
|
| https://m.economictimes.com/nri/invest/indians-top-the-
| list-...
| jandrewrogers wrote:
| The "massive influx of talented workers" and "the supremacy of
| the dollar" are not innate advantages, they are a consequence
| of the real underlying advantages.
|
| Much of the difference is reducible to American risk tolerance.
| They accept higher average risk for higher average returns,
| which compounds over time. They also embrace individual
| ambition to do great things as a society.
| camillomiller wrote:
| It's so damn American to dismiss any other way of doing things.
| No better way than the American way, am I right? Europe is sick
| and tired to be the sickly buddy of the world's bully. And we
| don't care about the wonderful ways the bully keeps finding to
| build his muscles and reinforce his attitude. You yankees will
| never really get it though, so I'm talking to the wind.
| pphysch wrote:
| > How would Europe even compete with America in the long run.
|
| Via "Eurasian integration", specifically the development of
| transport and logistics megaprojects across the heartland of
| Eurasia, strongly linking Europe to East Asia by land. But
| conveniently timed geopolitical events have delayed that
| somewhat.
| oytis wrote:
| The said geopolitical events have shown that Eurasian
| integration is a pipe dream. Unless we see geopolitical
| surprises with the opposite sign analogous to the fall of the
| Berlin Wall.
| dauertewigkeit wrote:
| While all of that is true, the supremacy of the US in the tech
| sector is entirely due to policy and culture, and has little to
| do with other factors, such as geographical wealth.
|
| What is holding us back here in the EU, is bad leadership and
| lots of outdated corporate, financial and political traditions.
| CalRobert wrote:
| No idea, but as an American who moved to Europe it's crazy how
| much ambition is casually discouraged ("the notions on him!")
| and investors are chickenshit scaredycats offering tiny
| numbers. Pathetic pay too.
|
| But I still live in Europe because I prefer well designed
| cities and everyone (mostly) having ample vacation time.
| ddol wrote:
| As a European who moved to California the societal stigma
| around young ambition in Ireland was brutal. When I started
| my first company in my 20's and spoke to friends and family
| about it a phrase I frequently heard was "ah here, why would
| you stick your head above the parapet?"[0]
|
| Having seen the kinds of Irish startups that get funding from
| Irish VCs they both tend to be run by Irish men in their
| 50's/60's who've been senior managers at big companies.
| Having reviewed a couple dozen Irish pitch decks it looks
| like funding flows based on who you know with little scrutiny
| given to ideas or even business fundamentals.
|
| [0] https://dictionary.cambridge.org/us/dictionary/english/pu
| t-h...
| fkcgnad wrote:
| [dead]
| CalRobert wrote:
| It was fun for a while but moving to Ireland was a mistake.
| bjornsing wrote:
| Reminds me of my homeland Sweden.
| pcrh wrote:
| Having been in both the UK and Bay Area, I agree with your
| points about VCs.
|
| However, the average age of tech founders in the US is
| older than you might expect, being well above 40yrs.
| Experience does count for something.
| crop_rotation wrote:
| That attitude can work in the post WW II world when
| Africa/Asian countries were too new to even work out their
| government structure. When most companies start making
| things, all the European policies seem like a recipe for
| accepting a much lower standard of living.
| Gareth321 wrote:
| > Pathetic pay too.
|
| If you're after better pay head to London, the Netherlands,
| Switzerland, Denmark, or Norway. You won't match those San
| Fran FAANG wages but they're still very good. I live a VERY
| comfortable life in Denmark and it's such a great place to
| raise a family.
| CalRobert wrote:
| Pretty much the instant I got the right to do so I started
| working remote for US companies. I have my own company and
| am working on moving to the Netherlands and talking to an
| accountant about how to ensure I can take advantage of the
| 30% ruling.
|
| Would you mind if I drop you a line? We're pretty in love
| with NL and have a friend there who describes it as a great
| place to raise kids (unlike rural Ireland, which is
| terrible), but DK has come up as an option now and then.
| Would love to know any thoughts you have to share!
|
| Email is in my bio if so.
| BenFranklin100 wrote:
| As the article points out, immigration is a key factor behind
| America's economic performance. Too many people in tech are
| hostile to immigration out of a misplaced fear of immigrants
| lowering wages or 'stealing' their jobs. Whatever legitimate
| merits those concerns may have - and research shows them to be
| few -- let's never forget that the hard work and entrepreneurial
| spirit of immigrants help create these well-paying jobs in the
| first place.
| aksss wrote:
| Let's make sure we're distinguishing between immigration of
| high skilled labor vs sending high skill jobs overseas or
| hiring high skill workers on low-wage worker visas.
|
| I don't know a single worker in tech that's hostile to
| immigration of high skilled labor, nor afraid of said immigrant
| stealing their job. Most people I know would be grateful for
| some help.
|
| I know plenty of people critical of work visa programs
| (including some of those working on them) and plenty of people
| critical of offshoring high or mid-skill labor. I also know
| plenty of people not happy about low-skill workers immigrating
| illegally en masse.
|
| None of that should be confused with an animus towards
| immigration generally. Willfully blurring out any nuance in
| such a complex topic isn't helpful for finding solutions or
| common ground.
| BenFranklin100 wrote:
| For one claiming not wanting to blur a topic, bringing up
| offshoring jobs -- essentially the opposite of immigration --
| is a rather odd response.
| 35208654 wrote:
| And we treat them, for that hard work and entrepreneurial
| spirit quite terribly. As a native born American I've been
| appalled at the mistreatment of H1B workers, and even those on
| other more "generous" employment terms.
|
| Some of the brightest, hardest working and genuinely wonderful
| people I've worked with have practically crawled over hot coals
| to get here. They are indeed a source of the United States'
| economic dynamism and we would do well to treat them well if we
| intend to maintain that dynamism.
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