Meaning, how many things we truly know how to build from the bottom up?
I personally do not know how to build a laptop, washing machine, house, furniture, or the software I use every day to make a living. Yet, I know how to understand and operate them.
Most people must be feeling the same way. As the world is getting increasingly complex, progress depends on building on top of existing infrastructure rather than reinventing the wheel every day.
“At some point, human intelligence became collective and cumulative in a way that happened to no other animal.”
That’s especially true in politics. Even if you elect a fundamentally different president than the previous person in charge, it’s really hard to rebuild the entire system.
At the same time, there are many arguments that inheriting power or wealth might not be the most effective way to succeed in today’s world.
Think of COVID and how most public institutions in the western world failed:
At the same time, people who did not inherit wealth and power but instead build organizations, aka founders - succeeded.
“Where heirs failed, founders succeeded. The internet stayed up. The state couldn't deliver checks, but Amazon could deliver packages. The legacy universities were closed but the MOOC platforms were open. The restaurants were shuttered by the state but the delivery apps were shipping. The media corporations reported that the virus was at best a remote threat while the tech companies prepared for remote work. And the billions spent on military biodefense didn't do much, but the millions invested in Moderna did.”
― Balajis
The essay proceeds to argue how many smart people moved from the east to the west coast of the united states to start companies. Hence, the west follows the model of founding and building, whereas the east relies on inheritance.
All in all, I agree with Balaji’s points when it comes to the USA. But what happened in the states is not necessarily true in the eastern hemisphere.
Let’s take, for example, Singapore. The government follows what Balaji calls read-only and inherited model as new politicians inherit a system that has been developed previously. While the country is young, there is sufficient infrastructure of government bodies to be operated and improved rather than starting from the bottom up. In turn, Singapore has achieved impressive results:
Another example that is not explained comes to mind is China. Since 1978, when China began to open up its economy, the country has averaged about 10% a year, lifting more than 800 million people out of poverty.
Meaning, here we got two cases where inheritance to wealth and power was not a hindrance to success and efficiency.
Having said that, I personally agree with Balaji’s chain of thoughts and believe it’s time to build rather than relying on systems that have grown too comfortable and fat, causing inefficiencies.
“Because it is a monopoly, government brings inefficiency and stagnation to most things it runs; government agencies pursue the inflation of their budgets rather than the service of their customers; pressure groups form an unholy alliance with agencies to extract more money from taxpayers for their members. Yet despite all this, most clever people still call for government to run more things and assume that if it did so, it would somehow be more perfect, more selfless, next time.”
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Founding vs inheriting review
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Recently, I stumbled on a post by Balajis on founding vs. inheriting that resonated a fair bit with me.
The essay starts with describing what Balajis calls read-only culture:
Meaning, how many things we truly know how to build from the bottom up?
I personally do not know how to build a laptop, washing machine, house, furniture, or the software I use every day to make a living. Yet, I know how to understand and operate them.
Most people must be feeling the same way. As the world is getting increasingly complex, progress depends on building on top of existing infrastructure rather than reinventing the wheel every day.
That’s especially true in politics. Even if you elect a fundamentally different president than the previous person in charge, it’s really hard to rebuild the entire system.
At the same time, there are many arguments that inheriting power or wealth might not be the most effective way to succeed in today’s world.
Think of COVID and how most public institutions in the western world failed:
At the same time, people who did not inherit wealth and power but instead build organizations, aka founders - succeeded.
The essay proceeds to argue how many smart people moved from the east to the west coast of the united states to start companies. Hence, the west follows the model of founding and building, whereas the east relies on inheritance.
All in all, I agree with Balaji’s points when it comes to the USA. But what happened in the states is not necessarily true in the eastern hemisphere.
Let’s take, for example, Singapore. The government follows what Balaji calls read-only and inherited model as new politicians inherit a system that has been developed previously. While the country is young, there is sufficient infrastructure of government bodies to be operated and improved rather than starting from the bottom up. In turn, Singapore has achieved impressive results:
The Global Competitiveness Report 2019 - Singapore ranked #1.
Bloomberg Innovation Index 2019 - Singapore ranked #6 and #3 in 2020.
Global Innovation Index 2019 & 2020 - Singapore ranked #8.
KPMG Change Readiness Index 2019 & 2020 - Singapore ranked #2.
Another example that is not explained comes to mind is China. Since 1978, when China began to open up its economy, the country has averaged about 10% a year, lifting more than 800 million people out of poverty.
Additionally, data suggests that both China and Singapore have handled the COVID situation much better than western nations. For months now, those countries have mostly returned to normal with infections are at low levels.
Meaning, here we got two cases where inheritance to wealth and power was not a hindrance to success and efficiency.
Having said that, I personally agree with Balaji’s chain of thoughts and believe it’s time to build rather than relying on systems that have grown too comfortable and fat, causing inefficiencies.