The srticle Education and Men without Work
Just skimming the comments, there is the withholding of judgment against young, able-bodied men who, for whatever reason, choose not to work. There is no puritanical moralizing about the ‘virtues of work’, or how ‘people should not be lazy,’ or how ‘one must choose between work or starvation/poverty’; rather, there is an attempt to empathize with and understand, from a economic and sociological perspective, why so many people are not working. There is nothing inherently virtuous about work, but rather work is seen as a means to an end. The shared narrative or common thread is blaming modernity, regardless of one’s individual politics. This issue of men not working is seen as symptomatic of modernity, not because of politics. Among both sides the the aisle, there is the implicit understanding that rapid changes in social and technological progress have made it harder for average-skilled men to find work, but such factors have also have created dis-incentives or discouraged men from working. An increasingly feminized society and workplace, combined with cheap and gratifying entertainment in the form of video games, makes not working an increasingly attractive proposition, and who can blame these men for choosing to ‘opt out’ of the rat race and corporatism, which is the source of so much misery, envy (Keeping Up with the Joneses), and brainwashing (such as diversity training and HR). Is someone who works an extra 10 hours a week so they can afford a boat or a golf membership, really happier than someone who plays video games instead? Men, from childhood to adulthood, are subjected to de-individualization, whether it’s being drugged in elementary school to be obedient, being brainwashed in secondary school to see whites as the source of all problems with society, and this brainwashing and indoctrination continues all the way through high school, college, and in the labor market. This is not just a conservative viewpoint, but many liberals can also agree that employers and educators value conformity and obedience more so than actual learning or value-creation.
Regarding the economic implications, is this trend sustainable? Is it possible to have a growing economy and rising stock prices if an increasingly large share of the population is permanently unemployed? And if so, who will support these people? I am optimistic nothing bad will happen and that this is part of the ‘new normal’. The growth of the wealthy global consumer is enough to offset weakness domestically from a possibly shrinking middle class, and there is also the rise of business to business, which bypasses the consumer completely. If most of the wealth and income growth goes to the top 5%, then it stands to reason that their consumption will also grow, too.
The top 10 tech giants have gained trillions in market value over the past decade alone. Microsoft, Netflix, Google, FB, etc. All that money is flowing into the Silicon Valley, federal governments, local governments,. etc. It eventually trickles down to everyone. If in 20-25 years these tech companies (and new ones) are 50-100x more valuable as they are today, but the US population and inflation grows at a smaller rate, then it logically follows that there will be more wealth for everyone. I am looking to a future in which the S&P 500 doubles every 2-3 years for many manY years to come. And same for Facebook, Amazon, Microsoft and other high-IQ tech companies. Imagine a future in which these companies are so big that they partition the US into a dozen or so nation-states, similar to the UAE, but tech-wealth instead of oil wealth and many more people. When I invest, I am looking a multi-generational horizons and paradigm shifts., not just year-over-year developments. What companies will rule the world, is what I am asking myself.
All this wealth created from FAANG stocks, real state, the S&P 500, Nasdaq, etc. is flowing into the general economy. Someone who a generation ago would have needed to work can be sustained by capital gains. There are many ( my estimate thousands) people who are able to not work because they know and or are related to someone who got rich with FAANG stocks and or the S&P 500 or real estate, and are coasting off the capital proceeds. If Wealth grows at a rate that exceed population growth and inflation, and all the empirical evidence shows it is, then it must follow that everyone will get richer in real terms. A decade or two from now there may be so much wealth created from tech stocks and the Nasdaq that a new ‘leisure class’ will be created. Creative and intellectual output will flourish. This is similar to the post-scarcity society envisioned by Marx but within capitalistic framework instead of Marxian one. Wealth inequality will also be wider than ever too in spite of supposed populist rhetoric from the left. Elon Musk will be worth $100 billion not long from now. Bill Gates and Jeff Bezos will be worth $300 billion soon. And no social unrest either. Things will keep humming along. There will be the usual viral YouTube videos of people losing their minds and jumping counters, juxtaposed with a wealthier and increasingly powerful elite. As one of the greatest forecasters alive and someone who has published original (AFIK) research into asset pricing, market micro-structure, and the stock market, when I say something is going to happen a certain way, that is usually how it happens. I am someones wrong, but not that often. In spite of of rising wealth inequality, everyone will still be better off due to higher living standards, for even the poor. I don’t think people appreciate how important this is. Queen Elizabeth and George Washington, despite being among the two most powerful people alive, were stricken by teeth ailments that today can be treated. Washington was bled to death after getting a throat infection. That was at the time considered the pinnacle of healthcare.
A future in which many young people are idling away playing video games instead of working may seem disheartening, but hundreds ago that was also how it was. Careerism is a relatively new concept. The belief that a career defines who you are and your purpose, is an alien concept, historically speaking.
[My advice has saved people tons. In dec. 2018 my dad wanted to sell. The S&P 500 had fallen 20% from its highs and he was getting anxious. He kept threatening to sell. So I needed to persuade him not to. I told him t o stick to the game plan. I reminded him of what happened the last time he sold, in 2013, which in retrospect was too soon. So I reminded him he had earned tens of thousands of dollars through dividends over the past year by not selling. He confirmed that he had earned money through the dividends, and that placated his fears just long enough for the market to bottom and finally rebound. The S&P 500 has gained so much since Dec. 2018 that even if there were a bear marker, we would still be way ahead. People don't understand that IF the market markes a gain, that IS money in the bank. That is YOUR money. When the market rises 20%, for it to fall another 20% is such an anomalous event, that the 20% gain can be treated as a realized profit even if you haven't sold. We've see impeachment, China, Iran, etc. and none have caused the market to fall more than 1%, so what makes the left so sure that the next contrived, media-generated crisis swill be any worse? Turn off the media, I say. It is bad for you.]
To help pay these social programs in a future of increased joblessness, restricting immigration should be a top priority, for either side. An anti-immigration nationalist would sweep the electorate, if anyone has the balls to do it. Trump came close but sorta dropped the ball after getting into office.
I dunno how much dead-weight a non working person is. It depends how much welfare such an individual consumes, versus how much he or she spends, as well as economic value produced indirectly. For example, an unemployed person produces value merely by giving the fed reason to keep rates low. That is worth something.
The us economy has done very well, especially in the past decade and relative to all other countries, in spite of a large number of unproductive or borderline productive people. Maybe this is not sustainable. I think it is. But that can change. I tend to err on the side of things not changing. That has worked well for me.