The New Economic Engine

https://youtu.be/fRfRZKivGwA

From our gracious host's latest, we once are left with the question of what the new economic engine may be to save us from the inevitable Quiglian decay. I believe we should be able to make headway here.

One key point is that whatever this new engine is, participants must be unable to hedge their bets. If there is a clear new economic engine that is seizing the day, any incumbent parasite will of course attempt to embrace it and wear its husk as a skin suit.

In previous transitions, the corrupted players were systematically excluded. A French nobleman could not directly engage in commerce or he loses his status. To a pre-industrial manufacturer, a factory looks like a huge expensive way to make goods that gives none of the flexibility or craftsmanship of a small shop. Who would engage in financial transactions when usury is illegal?

These are a handful of instances of defenses against the parasites hedging into control of whatever the new engine is. One such defense in our time would be a socially unacceptable social organization that simply outcompetes. Maybe a true fraternity to create new corporations? How could you run a company in a legal grey area that will not be automatically destroyed by the modern state?

I suspect the examples given in this podcast are the best and just need to be combined in a novel way. Distributed corporate organization enabled by cryptocurrency to build and reinvest into legally grey and hard to trace manufacturing sells is the obvious route. If you focus on areas that help secure sovereignty without being seen as a threat you might be able to grow into a critical mass that replaces the parasitic managerialism we have today.

I say all this, but it still seems implausible. It is more likely we will continue to decay until a technology innovation occurs that allows a new military power to come in and remake the state. The end result may be better or worse than our current predicament.

At the risk of being anti-contrarian, I'll go with VC backed, and later publicly trading, AI & deep-tech startups, principally based out of hubs like SF, SoCal and Austin, run or controlled by founders and/or their hand-picked successors.

There is more I want to say on this topic, I also watched the episode and it was great. But the TL,DR is it's misleading to search for a singular economy-wide instrument of expansion / economic engine. The modern economy is a patchwork of different capitalisms: industrial/entrepreneurial capitalism, monopoly capitalism, financialized capitalism, managerial capitalism and so forth. These are associated with different shareholder bases / legal structures and underwritten by different capital market structures.

My favorite capital market structure / instrument of expansion are public biotech investors. But they are small fish compared to what SV based (and I use SV principally as a social graph as opposed to a location, so for example Thrive counts as SV) private market investors have become.

The reason this is an instrument of expansion is because, the VCs invest in startups, they generate returns and take in inflows, thereby compounding their AUM, only to reinvest into more and more startups. This is likely to continue to compound, particularly as long as the AI boom persists -- which I expect.

Now this is not perfect, and its prone to inefficient king-making, bubbles, trading on access instead of due diligence capability and so forth. But insofar as there is a new economic engine, this is it. The idea that investors on the blockchain are gonna build crypto scams and longevity medicines in seasteads is as realistic as Moldbug's cryptographic chain of command.

We are too deep into the cycle of decay to properly provision a new economic engine, its the wrong order of operations. Its the man dying of cancer trying to figure out which workout routine will have him look the best on the beach this summer. Ultimately our broken clientalist one million bureaucrat magister per county system can not support anything but asphyxiation.

I have some ideas about what a new economic engine might look like, and I might write them up later in this thread, but we cannot start such an engine if the limited high agency high openness high intelligence human capital we have remaining gets coopted or destroyed by the regime defending itself. If we get a political revolution event where the executive power, whomever that may be, streamlines and provides legitimacy that bypasses the local one million magisterial regulator bandits, we can resume some form of real world economic activity again.