He's right that we need to reboot -- but the irony is that it's his generation (and his mentality itself) that is forcing this. The I-got-mine, greed-is-always-good, me-first, I'm-entitled generation of baby boomers (circa 1940-1958) is directly responsible for this mess. And, as usual, it's up to us Xers to clean up.
Friedman is emblematic of his generation. He likes to make blanket statements like "the world is flat!", leaving out precious details (like the fact that cultural differences mean that a guy in Mumbai cannot so easily start the next Amazon), and expects parental-like approval from all of us. Look what I did! Look at me!
Same attitude -- self-satisfied under-achievement -- created this gigantic CF we're calling an economy. Reboot? Yes. That probably means forcing all these codgers into retirement homes where they can bitch and moan about how we Xers aren't doing well enough recovering from their disaster.
Bailing out a failed business model is wasted investment.
Given your perception of the older folks, I'd suggest pursuing a business model based on catering to and profiting from those entitled boomers you appear to despise. But trust me on this one: some of those older folks are looking to profit from the perceptions of and the views of the younger folks, too.
Whether US-based or international, looking forward at what might change - what an upgrade from Acela to service competitive with TGV might mean, for instance - would be my preference. I'm looking at where I can improve, and how I can best deal with and can profit from the changes that are inevitably coming. At what and where the target is going to be. At what products and services I can milk or can sell off or can retire, too.
Changes are underway in the world economy. And I'd prefer to profit from both the "Xers" and from the "codgers" if I can manage it, as you'd termed these two large pools of potential consumers.
Blame? There's enough of that to go around.
Profit? Positioning for that in the current chaos is far more interesting.
Blame is not a wasted effort, if it leads you to think about what policies are to blame for where we are now and think about what needs to change. I'd say that profit is much less interesting, people find ways of enriching themselves without caring about improving society or doing anything useful. I'd wager that that mindset is at least partially to blame for the current state of affairs.
I think that Hoff is suggesting that creating value is better than blaming. As an entrepreneur I seek to create value, this enables me to make a profit. Adjusting my business to changed circumstances is a requirement for survival.
If you're looking to assign blame, then do evaluate your own particular motivations. You have probably already made or you are now about to make a mistake; you've taken your eye off your particular goals of creating value for your customers.
Certainly don't repeat (unprofitable) mistakes. Do learn from your own mistakes, and do particularly learn from the mistakes of others.
Competing against an organization that seeks to place blame on others? Now that's a potential business opportunity. That individual or that organization is not competing effectively. They're dissipating their competitive efforts. They're potentially vulnerable. Do you have a wedge here? An opening? Use it.
Do continue to move toward where the target business will be, regardless. Whatever goal or profit here you might view as your motivation. Blame doesn't move you toward that goal.
I agree with Hoff that creating value is better than blaming. OTOH an occasional rant might make us all feel a little better while we're creating all that value. :-)
Indeed! I am on the leading edge of the boomers and I can tell you we are just as concerned and just as angry. When I was growing up the WWII generation was lamenting how badly they had screwed it up (Vietnam, etc.) and were hoping we could do it better. Well we didn't and the generation after us, the current screw ups, didn't either. If anyone, I would blame Isaac Newton. His legacy is the mechanical universe and the philosophy the everything is perfectible. Hence the endless series of ideological laws and regulations and deregulations that will fix the problem du jour. What we need to understand is that people are greedy, short sighted, and selfish. They are also altruistic and caring. We need to diminish the unfavorable traits and emphasize the favorable. That's what antitrust and regulation do, keep the destructive side from becoming dominant. But we also need to avoid stifling society by tamping down the ability to innovate.
The fixing of all this is cross generational. If we don't fix it, every one will loose, including those who have it. Have you seen the projections for social security? The angst isn't fatal. We survived the depression of the depression, we survived the post-Vietnam crisis of confidence, and we survived the crisis that Japan was going to suck up all our mojo. (OK the auto industry didn't.)
"...That's what antitrust and regulation do, keep the destructive side from becoming dominant..."
People game systems. It's odd that you mention Newton -- the idea that some combination of regulations/deregulations will engineer a better economy is why our tax code is currently incomprehensible. Perhaps it might work if we try it again for the 50 thousandth time?
It might be better to look at the economy like a chaotic system, with billions of independent agents all working randomly yet somehow creating a greater whole. The trick is a minimalist yet-changing set of constraints to allow the chaos to continue and be productive. Once you start trying to put it in a box, or choose special parameters, or try to understand or constrain the entire thing in some fashion that you can understand, you're kidding yourself.
My opinion only. I can tell you that history is littered with really smart people, governments, and political parties who thought they could understand/control economics. Sometimes people mistake what I'm saying for laissez-faire or free-market philosophies. It's not. It's simply acknowledging that the over-engineering of things we don't understand usually ends up in stagnation and corruption, not growth and opportunity.
We're in quite a mess now in the U.S. because politicians get elected promising more things than they can deliver. If you ask me, we started heading down this track once the federal government usurped the states back in the 1860s. There's no more sharing of power -- people slowly are figuring out that they can directly vote themselves whatever the government can borrow. No kind of market or tax policy is going to be able to get us out of this larger problem. That's the meta-issue.
Ok, I think you are really on to something with the "it's impossible to calculate things" (the economic calculation problem postulated by some Austrian economists in the 30ies and 40ies), but where I split from the libertarians is that I don't think that means we should throw up our hands in the air and do nothing at all "gosh, it's too complicated!", but do the most direct, least invasive things to solve those problems that do need to be solved collectively. For instance, I think schools ought to be available to everyone, so that no matter who you are born, you have the means to become who you want. And that doesn't mean "just let the free market do it". I think introducing some market mechanisms might make sense - lessening the power of the teachers' unions and giving more money to good teachers - but I very strongly believe that even though most of our economy ought to be decided by a free market, not all of it should. I think that lack of simplicity grates on a lot of nerd/geek types who want a clean, simple, beautiful rule that will make everything work. However, people are messy, complex, contradictory creatures that don't function in a world of black and white.
If I'm not mistaken, this is similar to the Warren Buffet view of the economy: yeah, get the government out of the market where it makes sense, let the market do its work, but then whoever wins needs to share some of that with the poorest in our society.
I agree mostly with everything you said, but I would put things differently.
I think this all revolves around what the person means by "free market" Some people think this is a "free-for-all" while in fact a free market is usually regulated to some fashion to make it free (by guaranteeing private property rights and tort law for contract enforcement, if nothing else) So free market definitely does not mean lack of government support/definition/intervention.
Taking, for instance, the health insurance industry in the U.S.. I'm in favor of the government defining simple levels of insurance coverage, say from A to F. A would be total coverage for anything that went wrong (including preventive care). F might be catastrophic care only, with the guarantee that life-saving measures do not bankrupt the family (even is some measures might be denied).
In this case, the government can and should intervene to create the open market. Currently policies are so obfuscated by legalese that consumers effectively have no choice. In details-rich markets, like lending, insurance, airline fares, etc, the government can make the market freer by simply providing _simple_ standard categories of service.
As far as direct intervention in social systems, such as education, I think most right-leaning libertarians such as myself would support those interventions that directly related to things the government absolutely had to do. Education falls into that category because the need of a national army requires a standard of education. Health care in general is a very tricky area. We're developing life-saving cures for our elderly that cost more than the person made during their working years. I find it very hard to believe people in a democracy are going to vote for their own early deaths, so as a practical matter some kind of political appeasement needs to be made with the public at large, free market or not. I'm still thinking this one through.
The danger is taking a complex system and oversimplifying whether on the "leave it alone and everything will be fine" side or the "hey, we can engineer this thing to do whatever we want" side. It's way too complex to work like political slogans want us to believe. I think we're in agreement on this point.
"He's right that we need to reboot -- but the irony is that it's his generation (and his mentality itself) that is forcing this."
I grew up just a few miles away from where Friedman grew up, just a few years later. Friedman and a lot of his neighbors in his generation were early in urging their fellow Americans to have environmental concern and to be aware that America is just part of the world. I have good evidence for this, because my fifth-grade class made a time capsule in 1969 to be opened in the year 2001, with predictions of that year.
Perhaps Friedman's elementary classmates and my elementary classmates were part of a minority in America, but maybe people who share those concerns are still part of a minority in America. Anyway, these days it's easier for more Americans to see what is going on in the rest of the world, and there is plenty to learn from.
P.S. People in Friedman's generation and mine will be retiring at substantially older ages than our parents did--that's already a settled change in the Social Security law.
stop blaming greed. greed is universal. you think the baby boomers invented greed?
the problem was INCENTIVES. The federal reserve pumped up the money supply starting in 1995, then when the bubble popped in 2000 they pumped up the housing market in order to disguise the true severity of the crash. In an environment of practically free money you'd be an idiot NOT to grab your piece.
Friedman is emblematic of his generation. He likes to make blanket statements like "the world is flat!", leaving out precious details (like the fact that cultural differences mean that a guy in Mumbai cannot so easily start the next Amazon), and expects parental-like approval from all of us. Look what I did! Look at me!
Same attitude -- self-satisfied under-achievement -- created this gigantic CF we're calling an economy. Reboot? Yes. That probably means forcing all these codgers into retirement homes where they can bitch and moan about how we Xers aren't doing well enough recovering from their disaster.