Ezra Klein‘s eloquent polemic against income inequality looks a lot to me like a case study on the economic consequences of being a superstar, coupled with the notion that superstar economics are taking hold in ever more fields due to communication technology. And it is frightening, as he suggests.
But it also offers a hint of its own way out — Bono is going to spend his $1 billion in Africa fighting AIDS. Because of technological advances, that amount of money may win against AIDS (for the record, I think not at this time, but perhaps as few as 10 years in the future that starts to sound plausible). It is well known that the Bill and Melinda Gates Foundation looks for challenges based on the estimated dollar amount to solve a global problem like Malaria, and they seem poised to take on more ambitious challenges as technology allows.
Can impossibly satisfied superstars like Bono and Gates be expected to make up in philanthropy what used to happen by workers spending wages? Is that realistic? Should charity simply be enforced through taxes or another measure?
Here’s a great post on the Atlantic Cities blog on Rashid Temuri, the ingenious Chicago cabbie who has used Twitter to improve taxi service in Chitown and in the process become a kind of one-man taxi service himself. This is supposed to be a heart-warming story and it is, showing how superstar economics now apply to everyone with an internet connected clientele (which is to say, virtually everyone in a major metro and many others too). In the short term, Temuri is publicly outperforming his competitors and as a result he’s taking their market share. Of course, none of this is going to help in a few years when driverless cabs provide an even better service than Temuri can, and cheaper.
News is circling today that two British patients have had partial success with electronic retina implants restoring sight to the blind. This got me thinking about the steady progress of aids for the disabled. As cochlear implants, retinal implants, and thought-controlled prostheses continue to improve, people who would previously not have had the chance to make large contributions to society will be able to do so. Stephen Hawking is a good example of a disabled person who, aided by technology, has made a singular achievement in his field. Imagine if just one or two more such people are enabled by better technology to pursue their passions.
I basically agree with all of this until the last sentence of the second to last paragraph — I’m not sure what he means by “pay each other with the same money we use to buy real stuff.” since digital bit-based products are by their nature abundant, their price compared to whatever few “real” things remain scarce (and not deemed ‘necessities’ and therefore socialized, under his scenario) is going to be miniscule. I don’t think we can run an economy of sufficient size off “selling” protected “bits” to one another. that’s an artificial scarcity scenario that requires draconian measures to enforce, and thus seems unlikely.
Paul Graham‘s newest essay on defining property has an analogy I like a lot:
As a child I read a book of stories about a famous judge in eighteenth century Japan called Ooka Tadasuke. One of the cases he decided was brought by the owner of a food shop. A poor student who could afford only rice was eating his rice while enjoying the delicious cooking smells coming from the food shop. The owner wanted the student to pay for the smells he was enjoying. The student was stealing his smells!
This story often comes to mind when I hear the RIAA and MPAA accusing people of stealing music and movies.
If that’s not enough to get you to read the whole thing, there’s also this, in the footnotes, about the interconnectedness of technological progress and cultural definitions of property:
Change in the definition of property is driven mostly by technological progress, however, and since technological progress is accelerating, so presumably will the rate of change in the definition of property. Which means it’s all the more important for societies to be able to respond gracefully to such changes, because they will come at an ever increasing rate.
From Zero Hedge:
A company whose value is dependent on the continued success of two key products, now has a larger market capitalization (at $542 billion), than the entire US retail sector (as defined by the S&P 500).
Apple sells computers of various sizes. These makers of general-purpose machines have reached a symbolic milestone in passing the retail market cap. This has to do with stock strategy and market valuation as well as other complicating factors, so we can’t read too much into it. But it’s easy to imagine a company like Apple eventually selling more computers than the world sells non-computers. The everything box ultimately encompasses all other products.
Mark Cuban’s got a post up about the impending Yahoo/Facebook patent litigation. Warning: sarcasm is employed. (Some commenters seemed not to get it.) His basic point is that people will not realize what’s really at stake with patents until something big and absurd, like Yahoo getting Facebook for having personalized pages, goes through and hits a brand people care about.
I hope Yahoo is awarded 50 billion dollars. It is the only way that consumers will realize what is at stake with patent law as is.
Then maybe we can get it right and further innovation and competition in this country.
This is a really important technical argument from Karl Smith about the value of net investment data regarding the Stagnation thesis. It shows that, if you decouple IT investment from transportation and other kinds of investment, IT “has simply exploded [and] was unaffected by the recession, or any recession for that matter.” If American businesses are driving less and computing more, that’s not an argument for stagnation, it’s an argument that computer networks make driving inefficient for a lot of tasks. If a newer technology obtains higher efficiency and gets adopted, how is that not innovation?
If this Slashfilm article is to be believed, it would seem that Topher Grace has engaged in a remarkable and culturally valuable form of creativity that is expressly illegal to distribute even for free. Even the tools to create this artwork are of questionable legality. Should this be the case? If you think so, why do you think so?