There are some articles referring to the past 20 years as the modern Gilded Age. While Gilded Age is an American specific reference, it nevertheless carries a certain western culture mark in the early 20th century. However, the characterization of the Gilded Age, particularly railroads v.s. the internet, would come across to me as lazy. The fanatic obsession with literal bits over atoms comparison can delight certain readers, by and large, it failed to account for the scientific breakthroughs we accomplished in the physical world during the past 30 years. The modern Gilded Age would happily talk about income inequality and wealth gaps between the people and the super rich. While the class-struggle is real, the rather American centric view doesn’t help frame the issues in many other places during the Globalization. The last Gilded Age ended with a Great war. With the rising tide of Nationalism today, the non-cooperation between nations is a greater threat than another war.
The ruthless Globalization in the past century gives us a more interconnected world. This world brings new hopes, poses brand new challenges and unveils new ugliness in ourselves. The obsession with analogies of the old can only blind us with challenges at the hand and impede new progresses we have to make.
The Bits over Atoms Fallacy
The typical Silicon Valley’s talk would often revolve around bits versus atoms. It immediately draws a cheap analogy to railroads’ giants and today’s big tech corps. While the analogy is apparently appealing (railroads to fibers!), the modern days big tech corps don’t build the digital railroads. They assimilate, curate and disseminate information to you and of you. Today, the seemingly boundless “bits” is a result of all powerful service-based industries in the United States. These service-based industries only matter because the ever growing greed for profit margin. Globally, wealth is more diversely distributed than just finance and technology sectors. The list of top 10 richest people in the United Kingdom own very different things compared with their counterparts in the United States.
Technologies continue to shape our lives in important ways. But sweeping all the advances under the rug of digitalization wishfully ignores innovations in new materials, new manufacturing progresses and even the dearest new chip productions. The fallacy of bits over atoms emphasizes the form (bits) over the underlying function enabler (atoms) while the rapid progress of underlying function enablers drives us to new heights. Hopefully, over the next few years, people will rediscover the atoms as the moat for their competition again.
The Income Inequality Fallacy
The wealth gap analysis from Capitalism in the 21st Century was well-known. In the United States, the wealth gap was trivialized as the income inequality. The politicians are either too lazy or too dumb to discuss the the difference between wealth gap and income inequality. While it is true that in Europe, the income inequality was derived from wealth gaps (income generated from wealth far outpaced the income generated from labor). Professional managers are the new class in the United States that drive the income inequality.
The inequality of income as a signature symptom of the Gilded Age draws another analogy to the modern time. The dynamics of wealth destruction and creation in the United States however make it another lazy attempt to paint over another problem. Besides the income generated from wealth inherited through generations, both the career path of a professional manager and the wealth creation through destructive innovations can generate outsized income for people in the game. When means of production were outsourced to other nations, it can only be a limited argument to explain income inequalities.
While the wealth gap in the United States becomes a pure social structure play, the income inequality is a fallacy because it willingly ignores that the trouble is have nots, not haves. What prevents us from lifting the living standard for all as a society? Why haves can deprive resources from have nots? We as a society only recently have left the world of scarcity (with the Green Revolution?), it is doubtful that the artificial scarcity we created through privileges (luxury goods) will be the resources we deprive from have nots. As a society, we ought to have smarter solutions than going straight to the fallacy derived from the old scarcity world.
The more interesting question is about the developing world. If the United States entered the society of abundance, why the rest are not? Does the United States live in abundance because of technology breakthroughs, or on the back of its world dominance? These questions can find their references in historical context, but we need to have a new perspective to lift the living standard for everyone on the planet Earth.
The Great War Fallacy
The Gilded Age ended with WWI, and soon after, the Great Depression and WWII. It is never clear to me why people, especially men, have this enthusiasm with global warfare. Regional conflicts and ongoing tit-for-tat military operations will continue to be what they are. The Great War fallacy is deeply rooted in the belief that military conflicts can be effective means to advance one superpower’s objective against another. With the recent uprising of nationalism and xenophobia, this outdated view finally finds some of its consolation. It is all too familiar to draw an analogy of a new rising world power (Germany) against the old (British). That has been said, the mutual destruction power, the Globalization and the belief of a rule-based system are still very much alive in our modern world. However, the biggest fallacy of the new Great War is that there is nothing to bet on. There is not going to be a world after another Great War. Thus, believing in this fallacy has no relevance to our daily lives.
Although a war is meaningless to speculate on, the non-cooperation between superpowers could deteriorate the progress we have made so far. The soil for xenophobia and nationalism are richer than ever. While the dream of Globalization by elites is very much alive, the answer to why and an appeal to our better nature is desperately needed.
With a world-wide plague, an all-out trade-war, and the great fires from Climate Change, in these trying times, seeking a better tomorrow for our modern world can not be more critical. Analogies with old times are slides for the old man to swipe through on a sunny afternoon; it is an intellectual laziness. We ought to navigate our time more thoughtfully, with a hope and widened eyes. Doomsayers can always be right, but the future belongs to the dreamers.