This 1-hour podcast interview of Joel Kotkin by Brendan O’Neill is a must-hear. A few highlights:
• the 1st generation venture capitalists of Silicon Valley were engineers who wanted “to build a better mousetrap”. An amazing ecosystem of startups who became major companies.
• today, Silicon Valley is run by the same people who’ve destroyed economies everywhere: MBAs and other bean counters. Startup companies are built to be acquired by the big 5-6
• it is no longer about life-changing technology but about ephemera and selling your privacy to advertisers. Not building products people need but that they hate or fear
• Silicon Valley bank was “partying like it was 1985”: today’s companies aren’t even profitable. Live on easy money and easy virtue.
• the new SV overclass is often 2nd or 3rd. “A weird facsimile of the Big 3 in Detroit in the 1970s”.
• CA thinks it can impose whatever regulatory burdens and taxes it wants because “you have to be there” —- well, you no longer have to be there. The more ephemeral, the less need to be in a particular location
• people in the 1970 and 1980s could afford a suburban house, nowadays you either are stuck in a shoebox apartment for live and spend a ton of money on private schools, or you move to a more affordable state and can do the same work anyhow. Tech jobs are growing in FL, TX, AZ, and even NV and UT. There is even a small tech hub in a corner of AK
• actually, the whole BS about not building certain factories (such as chip fabs) in SV is a net negative for the climate, because building the same chip fab in Texas means a lot more energy required for HVAC (in Silicon Valley you can get by without heating or air conditioning much of the year). “If you’re so worried about global warming, remember it is global.”
* there are generic and specific problems. The generic phenomenon has been seen throughout history: 2nd, 3rd,… generation of entrepreneurs get fat, happy, and would-be aristocrats, and a lean and hungry upstart displaces them. You can see this first with Venice getting displaced by Antwerp and Amsterdam, London,… in the Industrial Revolution Manchester became the place to be… 1st generation of entrepreneurs were children of yeomen farmers or craftsmen, then after a few generation the industry barons wanted to marry into the aristocracy and become toffs, embraced socialist policies
The specific issues are insane and counterproductive wokebaggery and reverse-racist policies (which disproportionately hit Asians). As a result, Asian engineers have every reason to move elsewhere
* there is an unprecedented population loss in the 35-54 age brackets. Baby boomers who bought houses 40 years ago are doing fine with inflation. Young people are looking at a life of glorified serfdom
• the support for far-left, über-woke causes: (a) as a form of “protection money” (not his term) as they are so afraid of their HR staff etc.; (b) the new economic oligarchy have theirs and want to pull up the ladder behind them
• Silicon Valley has become anti-aspirational for all but a handful of people
• the real economic model the SV aristocracy embraces is actually neither socialism nor free-trade capitalism but the “corporatist” [*] economic model of Mussolini: statist cronyism
• if a coalition of left-wing populists and right-wing populists were to come together, Silicon Valley’s aristos would be in very deep trouble
And that’s just half of it summarized. Go listen to the whole thing —- it’s very much worth your while
Let me sign off with a little musical delight for the Sabbath. “I’m moving through some changes… I’ll never be the same…”
Have a great weekend and Shabbat shalom!
[*] The “Corporations” in classical fascism were the estates or classes. Fascist Italy had a “Chamber of Corporations” that functioned like a tame lower house of parliament. The most useful thing it ever did was deposing the Duce in its last meeting and dissolving itself
Spin, strangeness, and charm 