Elite Overproduction/Underproduction

[SavingWithBabies]

These articles made the rounds on another site and they seemed relevant to ERE:

Blame Rich, Overeducated Elites as Our Society Frays - Peter Turchin

Turchin noted, ... that the U.S. has far more lawyers, MBA holders, and millionaires per thousand population than it did 30 years ago. This is worrying because “elite overproduction” is, according to Turchin, an underlying cause of political instability. He blames elite overproduction for playing a role in the fall of Rome and the American Civil War, for instance.

Elite Underproduction - Anton Troynikov

Turchin has cause and effect the wrong way around, Elite Overproduction is a consequence of a closed frontier.

Elite Overproduction is a result of Malthusian Ideology; a set of beliefs that at root reflect the idea that all frontiers are closed, and all that is left is to decide who is to own what, and who is to rule. It is the consequence of believing that things can only get better for some at the expense of others, rather than for all together. In the bloodless language of economics, in equilibrium all surplus is competed away, in the bloody language of history you instead find words like Lebensraum.

I think this is relevant because ERE provides a "road less traveled" option. At least it seems like it would to me in that stringent ERE can dramatically lower resource consumption and allows a form of opting out?

Perhaps hitting closer to (Jacob's) home, it was interesting that it went on to talk about this topic in relation to physicists and their career paths in the current world. I hesitate to quote more as I've already quoted a fair amount and the second article is not very long. But I was curious what others thought about this topic. As a (perhaps tired) optimist, I prefer Troynikov's take as I wouldn't be surprised if academia, as it exists today, is a hindrance to "making meaningful contributions to our understanding of the physical universe."

Footnote: I do not consider myself to be an elite. But the examples given would apply to many here (lawyers, MBA holders, millionaires). Perhaps Turchin's use of millionaire needs to be updated for inflation.

[jacob]

They're both right. If a system is resource constrained, complexity tends to increase because it is the only way to increase the efficiency of the declining resource base. It's a race to the bottom (see e.g. algorithmic trading or the exponential increase in lawyering for even the silliest reason.).

Insofar this complexity is structured in the wrong way divisions within society can develop. People seem okay with elite basketball players being much better at basketball. They're generally not okay with elite business executives being much better at solving business problems than others. They're also generally not okay with intellectuals knowing far about whichever thing than average. They seem okay with religious elites being closer to The One than others. There's a certain arbitrariness to this but perhaps it has to do whether it's easily possible to understand and appreciate what goes into something (basketball) or not (whatever it takes to create and run an organization with 10k+ people).

However, one is not going to resolve the frontier problem by dialing up production of human resources if the underlying structure is wrong. For example, physics was an exponential growth industry up until about the end of the cold war. Each professor could train 10 replacements and they'd all find jobs as professors. This is pretty much the situation that programming and molecular biology finds itself now. As far as physics goes, The future is so bright pretty much called the market peak for physics careers in 1986. However, the structure didn't change even if exponential growth stopped. Thus each professor now trains 10 replacements for ~1 position. To add insult to injury, old professors don't want to retire. Physicists basically go into high finance, software, or management consulting because they're intellectually flexible and capable of doing so.

Other fields that have passed the https://en.wikipedia.org/wiki/Gartner_hype_cycle but do not produce "elites" with the same flexibility have their human resources downgraded to pushing french fries and mocha and so are not recognized as elites.

Without a change in structure, it's possible to overcomplexify and waste human resources so as to bring them more in line with the limited availability of other resources. E.g. when there's less work because there's less stuff to work with we simply demand longer schooling for the same jobs. That's called being "overeducated".

Of course, there's technically lots of work that needs to be done in order to sustain civilization as an ongoing concern. However, this would require significantly restructuring the power structure of society. There are lots of people who are not interested in [civilization] compared to how interested they are in being better off personally.

[Sclass]

Hey thanks for posting this. Very interesting.

Some of the comparisons need some imagination. I think the middle class in the gilded age and czarist Russia were a lot worse off than middle class people in the US for example today. Millionaires were a lot harder to mint thirty years ago simply due to inflation and inflating assets like stocks. I try to hope we aren’t close to any kind of civil war. The things people grumble about in the US today seem pretty small compared Oliver Twist’s World.

Hah lapsed physicists. I guess I have to admit, I have a BA in physics. I’m not sure what I was thinking when I majored in physics at 18. I had some pretty naive ideas back then. It made it very hard for me to get employment. Which…hum…may have forced me on my current trajectory to becoming wealthy. Never thought of it that way. He may be on to something. I would have been short circuited if I’d gone to a National lab or JPL.

I must have crossed paths with Elon during our first week at Stanford. He had the guts and intelligence to get out quick…like in five days. Now there’s a lapsed physicist.

Hey speaking of ERE and resource depletion I saw this really need photo essay on Apple news. It has all these photos of different dumps around the world. I’m sure others caught it. Made me want to stop buying stuff even though I can finally afford It.

[bostonimproper]

I’m wondering if there’s a better word for it than overproduction or underproduction. Really, it’s an elite obsession with local optimization. Which makes sense, local optimization is less risky and pretty easy to spot, which means the personal ROI is higher, fewer entrenched interests to combat, etc.

[Campitor]

People seem okay with elite basketball players being much better at basketball. They're generally not okay with elite business executives being much better at solving business problems than others. They're also generally not okay with intellectuals knowing far about whichever thing than average. They seem okay with religious elites being closer to The One than others. There's a certain arbitrariness to this but perhaps it has to do whether it's easily possible to understand and appreciate what goes into something (basketball) or not (whatever it takes to create and run an organization with 10k+ people)...

This part of Jacob post really grabbed me. Why would people be okay with Basketball elitism but not business executive elitism? I wonder if it has anything to do with the following.

People can vicariously participate in a Basketball player's victories versus not being able to do the same with a business exec activity for obvious reasons. And people don't perceive the opportunity costs to watching basketball. They are choosing to spend time watching sports or procuring sports merchandise versus a more productive activity/investment. An overly successful executive is perceived as rapacious at the expense of the non-managerial class.

The barrier to entry for basketball is incorrectly perceived as low, only needing a hoop and a ball, versus actually having the genetics to thrive in the NBA and the intelligence to memorize plays and recognize and react to patterns - as the saying goes, anyone can dribble a ball ergo the vicarious participation in sports. This incorrect perception to the basketball barrier of entry could cause people to feel "I could have made it" versus the perception that being an elite executive requires some innate ability they don't have versus the reality of only needing an average or above IQ.

No one is viscerally aware of how many fail at becoming NBA stars but failure to advance in a desired career is felt at a deeply personal level and may create animosity against the executive tier.

[chenda]

I think there is also a certain transparency and measurability in skill at basketball Vs being a skilled business leader or intellectual.

You can't really fake sporting skill in a court, but a business leader or intellectual might be corrupt or benefiting from nefarious practices. Of course a famous sportsman might be too but his/her aptitude at the sport can't really be faked.

[jacob]

This part of Jacob post really grabbed me. Why would people be okay with Basketball elitism but not business executive elitism? I wonder if it has anything to do with the following.

People can vicariously participate in a Basketball player's victories versus not being able to do the same with a business exec activity for obvious reasons. And people don't perceive the opportunity costs to watching basketball.

Perhaps the difference is in whether the outcome or performance-metrics are simple to judge. Despite the underlying complexity or unseen differences in millisecond timing, inches, and balance, "ball into hoop", etc. are simple to understand. It's also simple to understand/decide if one likes more singer better than another. (For the purpose of paying for a record, it doesn't matter whether the singer is actually better, higher vocal range/better pitch, by some technical metric.)

Whereas most laymen are unable to differentiate intellectually between enthusiasm and insight and so will often go with the former when it comes to expertise. Similarly, the value-add in terms of executives mostly goes unseen when the organization is running smoothly and so they become associated with failure or "doing nothing" because the performance metric in this case is so complex that it often takes one to know one.

I'm trying to think of exceptions.

[jacob]

You can't really fake sporting skill in a court, but a business leader or intellectual might be corrupt or benefiting from nefarious practices. Of course a famous sportsman might be too but his/her aptitude at the sport can't really be faked.

That's an important point because humans as social animals put importance on signalling.

Attribution also seems important.

The intellectual may be faking it. And the audience is unable to tell.
The success of the organization may not be attributed to the decision maker. And the audience may be unable to tell.

For example, many seem unable to distinguish between outcome and process. A good process with a bad outcome will be judged as a failure by laymen compared to a bad process with good outcome.

[oldbeyond]

I guess “elites” acquire their position by resolving (to an extent…) some crisis the society faces. Out of the chaos is born vitality, and then this solution eventually becomes the problem for a new generation to solve. Sort of “hard times create good men” applied to society at large. It seems that current elites are closer to “creating a problem” than “solving a problem”, and that there’s a lot of applying familiar solutions over and over again.

[zbigi]

People can vicariously participate in a Basketball player's victories versus not being able to do the same with a business exec activity for obvious reasons.

Here in Poland you hear a lot of grumbling about footballers' outrageous salaries. Moreso than salaries of CEOs, probably because the average Pole does not think about CEOs at all (American obsession with success hasn't really caught on here, at least not yet), while he's pretty interested in football (soccer).

[Qazwer]

The question is whether the ‘elites’ provide a benefit. On some level, most jobs in the complicated system of our production are just intermediaries to physical products. We need to know how much to produce, where to produce and how to use. If you recommend a medication to a sick patient, that is just an intermediate. You are not producing the medication. You are not delivering it. You are just recommending it. If you design a computer chip, you are not building it. You then need someone to test it. You need someone to make sure that it’s production does not include waste products that will destroy the environment (law). You need a mechanism to figure out how much to produce (finance) etc etc This differs from regulatory capture where elites are just pulling resources by controlling the underlying bureaucracy.
https://en.m.wikipedia.org/wiki/Regulatory_capture
The question is how much of our society is just complicated requiring multiple interlocking pieces and how much is just captured to the benefit of an elite without any benefit.

Are the physicists developing new research or just playing the ‘grant game’? Are the university administrators helping to develop the best students and designing the environment to maximize education and research or are they just pulling high salaries?

[Sclass]

People seem okay with elite basketball players being much better at basketball. They're generally not okay with elite business executives being much better at solving business problems than others.

Before we run off trying to figure out why this is true I think it’s truth needs to be qualified a bit. As an investor I’m totally ok with CEOs being better at solving business problems than others. The market rewards these guys. I get what you’re saying that there’s this backlash against overproduction of elites but we kind of celebrate the successful CEO. Just watch some of those CEO interviews on CNBC. It looks a lot like an ESPN interview.

I guess when I first read your basketball analogy I instantly remembered my anthropology professor in my college asking why they didn’t have affirmative action in basketball. He got fired for that. Then I realized we don’t really have affirmative action in the C suite. That kind of brought me to wondering if we actually resent the elite CEO at all.

[Mister Imperceptible]

People generally are supportive of an elite if that elite either furthers the individual’s self interest, or seems to be representative of an ideology the people hold dear.

A shareholder of a company will applaud’s a CEO’a success because he partakes in that success. If the success of an entire class of elites depends on a government policy (and an underlying resource base that enables it) for example, for the most part that class of elites will attribute to themselves positive attributes that do not actually exist because it is convenient to deny the importance of that policy, the underlying resource base, and its consequences (up and until that underlying resource base exhausts and the policy fails).

Sports are a sort of surrogate activity where the masses see themselves as separated from the athletes on a fundamental level (“I could never do that”) and also an opportunity to have bragging rights and see one’s group as superior to the rival’s fans. At least until societal prosperity decays- then the wealth the athletes are accruing looks like it is being directly taken off the plates of the masses who are hungry.

Judging by the lines on this map (https://m.youtube.com/watch?v=UY9P0QSxlnI), they move frequently, and long periods where they don’t move a lot are followed by momentous periods where they move a lot. That inherent volatility building under the surface of stability is not only the complexity exhausting the underlying resources but also the elites jockeying for position. Without an expanding frontier (to increase the resource base, usually at the expense of a neighboring nation and most/all of their elites), all systems begin to cannibalize, as the elites devour the masses and eventually each other, and that makes the system fragile (even if giving an outward appearance of stability, periods of low volatility beget periods of high volatility). Elites will try to maintain the status quo, but the world is becoming.

“History is a graveyard of aristocracies.” -Pareto

[Mister Imperceptible]

I think it is worth adding, since some of the conversation up thread is about the apparent resentment of the masses against elites.

The majority of folks do not have a problem with excellence, whether it be in business or sport or otherwise. They have a problem with a rigged game. The game is clearly rigged, so the defense of current winners seems awkward because, at the moment, in the aggregate, the primary driver of whether and how much money one gets is based on how much money one already has, *not* how well they run a business. Elon Musk can’t run a business that doesn’t lose money and he is the richest person in the world. So I don’t buy the business CEO defense, not today. Business CEO's today sure know how to strip mine pension plans and issue billions in unrepayable debt at 0% interest to buyback their own stocks like absolute champions though. The US economy looks mostly built upon fraud, which of course is not sustainable unless the US can find more unexploited resources to strip mine.

I think it was in a Stendhal novel that I read that the Italian peasants did not resent Napoleon because his domination seemed justified by merit, whereas the rule of pre-existing nobility did not seem justified. I do expect a lot of apologetics for the existing elite, many of whom look ready for the recycling bin.

Upon reading that “Underproduction of elites” article, it’s true that if people are forced to make money that they cannot make contributions to advance a field of knowledge. A contrary system would never be perfect, because so many contributors would still go unheralded and unpaid, but there is no doubt that the current system is absolutely Malthusian. If you have everyone receive UBI or some kind of grant to pursue their interest independent of profit, the byproduct would be 10,000 Marquis de Sade’s for every 1 da Vinci. So the Malthusian grab seems to indicate a lack of physical and mental resources, and impending high volatility that has been pushed beneath the surface- better ill-get while the ill-gettin’s good. I think the shitshow that started 18 months ago is just beginning.

[Mister Imperceptible]

Yeah, It’s Still Water

The Rake

Once You Buy A Prize, It’s Yours To Keep

Shot, Chaser

The muckraking Ben Hunt did is one of the most illustrative instances I can think of. In a nation where the head of a company whose planes are falling out of the sky gets millions and his company bailed out is ripe for for one of those movements like the Huns and Germanic tribes around 370-476CE.

Today, management has no stake in the malfunctioning corporation called the USA. If they don’t build anything, the elites will cannibalize themselves.

[WFJ]

I would suspect that authors are doing something called "data fitting" where the conclusion is predetermined and just finding examples that support their hypothesis and not anything useful. Physicists lapsing is more of a function of the additional opportunities outside of the NPC academia existence as most outside of academia consider Physics to be the most objective filter of intelligence, not as evidence of some Elite overproduction Malthusian social competition. If there was some kind of "Elite Overproduction" PhDs in Chemistry, Biology, under-water AND over water basket weaving PhDs would be "lapsing" and plundering "make number go higher" jobs. If "number go higher" were so easy, why doesn't Turchin or Anton just crush it for a few months, use their gains to then fund research in the infinite frontier themselves? Problem soled.

Turchin is an anthropologists and will let anyone in academia expand on their experience with profs in this department. Does he know any Physics PhDs working in academia who only eat Ramen. This is a great strawman argument.