Saturday, December 14, 2013

Revolt in District 4

The title of this post, Revolt in District 4, is an intentional reference to Suzanne Collins' Hunger Games series. The protests this week against the buses in San Francisco that carry high-tech workers to their jobs evoked in us a mash-up of The Hunger Games and Tyler Cowan's 2013 book Average is Over. We are taking liberties by assigning San Francisco to District 4 (the presumably poorer fishing district) and assigning Mountain View and Silicon Valley to District 3 (the richer technology district). Please note that we do that just for the purpose of illustration since San Francisco is more about fishing than Silicon Valley.

The reason this mash-up works for us is that Dr. Cowan suggests that workers will segregate more and more into those who can deal with high technology and those who cannot. (See our post That Sounds Pretty Bad.) The fifteen percent or so who can work with high tech will become relatively rich. Many or most of the remaining 85% will become relatively poor and will be relegated to "shantytowns." That sounds like the Hunger Games' poorer districts to us.

Therefore we think it is reasonable to expect protests if we actually proceed toward Tyler Cowan's dystopic vision of the future. Perhaps the protests in San Francisco are some of the first of these. The dislocations, displacements, and evictions related to the wealth differentials between high-tech workers and the average San Franciscan is beginning to cause friction. High-tech workers may become the bad guys because they are driving out the "Old San Francisco," buying up housing and raising prices.

Adding to the friction is the attitude of the "techies." Some of them have made unfortunate public comments that they later have to apologize for. We think that is only natural. High-tech workers experience rapid change and high stress. If you cannot keep up, you are out. Like soldiers charging a hill, they have to focus on the objective. The wounded get left behind. Tough, but that's the way it is.

High-tech workers will also say, with perfect truth, "If you are jealous of us and our higher salaries, there is nothing stopping you from competing with us. Try doing what we do all day and see if you are good enough. Of all the jobs there are, high tech jobs are the most open to everyone. You just have to prove that you can do the work and keep up."

Perfectly correct, but we say that sometimes you can be right and still be wrong. Wrong in how you say the truth. Wrong because of the context. Wrong because of the emotional content. Wrong because of your purpose. If you use the truth only to bully others, then the truth content gets lost in the attempt to create a dominant/submissive relationship. If you say that "We are the best of the best of the best, and we prove it every day. If you cannot keep up with us, then too bad," then you can only expect resistance to you to increase over time. An "Eat dirt and die!" attitude is always wrong even if your facts are perfectly correct.

Returning now to the economic aspects of this, we think it is true that relatively wealthy high tech workers also act as proxies for the rich. Encouraging them to occupy certain areas is a way, perhaps, to "spruce up" those areas and drive out the riff-raff. All without a rich person having to say or do anything publicly, or even privately. When you occupy a middle level in an organization and are paid a bit more than others, one of the unspoken things you are paid extra to do is take the heat off your employer by taking the blame. Taking a "bullet" for your employer is a major component of what is today called "loyalty."

What this means is that we ( are on both sides of this dispute. As the system is set up now, on "this side of capitalism," there is no resolution to these kinds of disputes. The reason why this protest captured our attention is that it is a microcosm of the larger disputes across the US. The rich are driving the poor, arbitrarily changing their lives and causing conflicts; invading "their" territory. More conflict is inevitable. Again, there is no solution. That is because the system is fundamentally flawed.

The flaw is that the rich and the poor participate in the same markets and with the same currency even though the markets are no longer competitive. If the rich decide to use their economic power to drive the poor out of San Francisco, our "free" markets allow that. Whatever social and physical capital the poor have built up will be taken from them or destroyed.

In the system, however, the rich would not be able to arbitrarily destroy entire poor neighborhoods that have long-standing social structures. That is because the rich and the poor would be in different markets and use different currencies. Divide-and-conquer techniques could not be used against a neighborhood because the rich could not make offers directly to individuals.

It is important to recognize that there is a huge difference between trying to preserve jobs in buggy-whip factories and trying to allow the poor to save and preserve capital. The buggy-whip factory is outdated technology and workers with outdated skills. On the other hand, a nice San-Francisco neighborhood might be destroyed not because it is outdated and useless, but because the rich cast envious eyes upon it and maneuver to take it away from its less-competitive owners. Where is the social or even economic value in that? is proposing a way to fight the arbitrary destruction of the poor by the rich. Support

The way capitalism should be.

Socialism for the socialists and capitalism for the capitalists.

TheOtherSideOfCapitalism (

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