There is an astonishing amount of bad thinking in this piece. More than even normal.
1. The chart of what is rising in cost versus falling is far easier to explain as "Stuff everyone has to buy to live" versus "stuff they don't."
2. The rise in wages for HVAC is below inflation, and the other trades even more below inflation. Neither is even close to the rise in stocks, CEO pay, or yields from private equity
3. Jevon's Paradox is that efficiency leads to use, not "spend more on what is more productive". Your description is just wrong. In Jevon's Paradox the classic example is when the cost of a unit of energy falls, the aggregate energy use grows. It is not "Things that are more productive are more expensive"
The underlying phenomenon you are grasping for is much simpler to understand - when more wealth enters a system, it forces prices up. As a result some services disappear (trying finding a sewing machine repair shop) and some get more expensive, because those people are competing for the same necessities, housing, food, medical, as the people with excess wealth.
Even the orchestra example is a whiff. Orchestras declined because of taste coupled with the proliferation of entertainment alternatives. It is likely they were only sustained as long as they were by a static economic state (the princes). Chamber music is incredibly productive when one includes radio, Spotify, and digital recording.
This article is tendentious nonsense, but predictable for people pushing AI.
Because it is not only bad thinking, it is thinking that will hurt people.
There is a blithe indifference towards actual people in the places like A16Z and the big tech CEOs. Some of it is terrifying like calls for eliminating democracy, but this type of messaging is also deeply corrosive, because the logical conclusions end up removing culpability from the very dangerous people who are causing the issues with affordability.
I see your point. But if the guy has taken the bet on keeping comments open and non-paywalled, which is becoming rarer by the day here, perhaps the more considerate approach should be tried first. After all, I think they sincerely believe they're the "good guys", you know, and more adversity is not going to make them change perspective.
You will find strong analogs between “things you cannot choose not to buy” and “things the government is involved in.” Military, police, schools, health, etc
This is because the market algorithm requires choice to function. Capitalism sucks at “everybody, all the time” until it becomes franchise capitalism, in which case it is just extraction, and hence drives prices up.
computers, phones, and cars seem more essential to function in the modern world than college tuition and textbooks
on a longer time scale, the costs of most low-tech necessities have also fallen, eg clothing, clean drinking water, imported foods, artificial light, etc.
Won't work. That gentleman's time is so important ("valuable"), or so he thinks, that pretty soon even wiping his own ass will have to be outsourced to some prole.
This essay resonates with a few things., the pattern you describe — cheap AC but costly AC repair — mirrors how every big productivity leap reshapes, not replaces, work. Spreadsheets didn’t end accounting; they made everyone an analyst. Now Amazon and YouTube are doing the same for physical expertise, turning homeowners into part-time technicians.
It also ties into David Graeber’s Bullshit Jobs: the more abundance technology creates, the more people crave visible, consequential work. DIY isn’t just frugality — it’s a quiet rebellion against meaning-less labor, a way to reconnect effort with outcome.
Here’s a reflection I co-shaped with ChatGPT based on these thoughts I had: http://simp.ly/p/3GXhx3
You have nicely described poorly designed work systems that provided too little feedback to provide meaning. That is not inherent to the work; it is a consequence of design choices made by management.
A few ideas that would be fun to consider further;
If you consider Baumol’s as a two-segment model, where growth rate of Sector 1 (high growth) and growth rate of Sector 2 (stagnant) are exponentially related and the cost relationship between the two segments are governed by the productivity of Sector 2, there should be a some analysis that shows the de-growthing effect (negative pull down, or up in the graphs case) that occurs in our “red lines” from above.
On the other side, Jevon’s is mostly driven by elasticity, which makes sense in that when wealth growth consumers for less technical products become inelastic toward consumer spending (fixing holes, walking dogs, etc). Now the question is, where does the asymptote of Jevon’s emerge and is it perspective or monetary? Meaning, Jevon’s will continue to “raise all ships” to a point of demand, where elasticity breaks due to no longer fitting the curve or simply the whiplash of cost increase making consumers allergic to spending.
No mention of private equity taking over every industry, and systematically/globally price fixing and raising prices. This includes HVAC shops, local veterinary clinics, etc., etc.
There is a higher ed aspect to this story, as I discuss in my piece linked below, about why it is (too) expensive to produce smart, competent HVAC repairpeople -- Not only would the current system not support a college student going into HVAC repair, every aspect of the system is designed to dissuade the student, because this career path would show up on the system’s dashboard as an educational failure and political disaster, because an HVAC or plumbing career does not seem upwardly socially mobile. https://hollisrobbinsanecdotal.substack.com/p/seeing-like-a-state-university
Whoa. “…not support a college student going into HVAC repair…” ——> one does not need a college degree for HVAC install or repair. In fact, it’s quite the opposite in that this is exactly the type of job that should be learned via apprenticeship. The “current system” you are referring to has more to do with the institutionalization of “going to college”. Not everyone should go to college and it’s borderline criminal/waste of money that more don’t use the Jr College path. There shouldn’t be a dashboard that signals anything. Upward social mobility isn’t what everyone wants even if it is what some may want for their kids.
Totally agree! But let's say you "want" to go to college for an English degree or an art history degree because you want to be educated in cultural forms. The college shouldn't then be penalized if you then go into plumbing or HVAC after graduating.
Is the college penalized if a student goes into something like HVAC or plumbing after graduating? It seems like there are tons of people who go into jobs which are menial and/or unrelated to their area of study, but colleges chug along still offering degrees in literature and art history and the like. Going into HVAC or plumbing afterwards might even offer better prospects than, say, the average unremarkable email job
There is an astonishing amount of bad thinking in this piece. More than even normal.
1. The chart of what is rising in cost versus falling is far easier to explain as "Stuff everyone has to buy to live" versus "stuff they don't."
2. The rise in wages for HVAC is below inflation, and the other trades even more below inflation. Neither is even close to the rise in stocks, CEO pay, or yields from private equity
3. Jevon's Paradox is that efficiency leads to use, not "spend more on what is more productive". Your description is just wrong. In Jevon's Paradox the classic example is when the cost of a unit of energy falls, the aggregate energy use grows. It is not "Things that are more productive are more expensive"
The underlying phenomenon you are grasping for is much simpler to understand - when more wealth enters a system, it forces prices up. As a result some services disappear (trying finding a sewing machine repair shop) and some get more expensive, because those people are competing for the same necessities, housing, food, medical, as the people with excess wealth.
Even the orchestra example is a whiff. Orchestras declined because of taste coupled with the proliferation of entertainment alternatives. It is likely they were only sustained as long as they were by a static economic state (the princes). Chamber music is incredibly productive when one includes radio, Spotify, and digital recording.
This article is tendentious nonsense, but predictable for people pushing AI.
Hey, good points, but why be so mean?
Because it is not only bad thinking, it is thinking that will hurt people.
There is a blithe indifference towards actual people in the places like A16Z and the big tech CEOs. Some of it is terrifying like calls for eliminating democracy, but this type of messaging is also deeply corrosive, because the logical conclusions end up removing culpability from the very dangerous people who are causing the issues with affordability.
I see your point. But if the guy has taken the bet on keeping comments open and non-paywalled, which is becoming rarer by the day here, perhaps the more considerate approach should be tried first. After all, I think they sincerely believe they're the "good guys", you know, and more adversity is not going to make them change perspective.
You’re a really decent guy, and I appreciate how you help create a healthy environment for discussion.
Being direct makes conversations much more effective, and I think he handled that really well.
Also, I don’t think being critical is what’s going to make a16z decide to put up a paywall, haha.
I know. And I definitely am conflicted.
If it were general political beliefs I hear you.
But we are nearing a civilization-level crisis, and we have to speak truth.
It's actually "stuff the government is involved in" that is getting more expensive.
You will find strong analogs between “things you cannot choose not to buy” and “things the government is involved in.” Military, police, schools, health, etc
This is because the market algorithm requires choice to function. Capitalism sucks at “everybody, all the time” until it becomes franchise capitalism, in which case it is just extraction, and hence drives prices up.
computers, phones, and cars seem more essential to function in the modern world than college tuition and textbooks
on a longer time scale, the costs of most low-tech necessities have also fallen, eg clothing, clean drinking water, imported foods, artificial light, etc.
That is not what the Jevons paradox is.
…or you can use ChatGPT to explain to you how to fix the hole in your drywall yourself.
4th series of prompts..........That is correct removing the studs from a load bearing wall IS a bad idea, letme give you another solution
Won't work. That gentleman's time is so important ("valuable"), or so he thinks, that pretty soon even wiping his own ass will have to be outsourced to some prole.
Sure, the billionaires gonna billionaire. And the proles gonna prole.
There will be a big space between the two. Some (many?) will be squeezed into prole by the high cost of living.
Bur some will be able to ride on the extra skills made available by ai to avoid the high cost of living.
Instead of paying $1000 to fix the drywall, they will use their $100/mo ai subscription to learn how to fix it themselves for $20 worth of materials.
Reading this gave me a headache.
This essay resonates with a few things., the pattern you describe — cheap AC but costly AC repair — mirrors how every big productivity leap reshapes, not replaces, work. Spreadsheets didn’t end accounting; they made everyone an analyst. Now Amazon and YouTube are doing the same for physical expertise, turning homeowners into part-time technicians.
It also ties into David Graeber’s Bullshit Jobs: the more abundance technology creates, the more people crave visible, consequential work. DIY isn’t just frugality — it’s a quiet rebellion against meaning-less labor, a way to reconnect effort with outcome.
Here’s a reflection I co-shaped with ChatGPT based on these thoughts I had: http://simp.ly/p/3GXhx3
You have nicely described poorly designed work systems that provided too little feedback to provide meaning. That is not inherent to the work; it is a consequence of design choices made by management.
https://chatgpt.com/s/t_6914ca41a20081919684b7a7bbe4604f
A few ideas that would be fun to consider further;
If you consider Baumol’s as a two-segment model, where growth rate of Sector 1 (high growth) and growth rate of Sector 2 (stagnant) are exponentially related and the cost relationship between the two segments are governed by the productivity of Sector 2, there should be a some analysis that shows the de-growthing effect (negative pull down, or up in the graphs case) that occurs in our “red lines” from above.
On the other side, Jevon’s is mostly driven by elasticity, which makes sense in that when wealth growth consumers for less technical products become inelastic toward consumer spending (fixing holes, walking dogs, etc). Now the question is, where does the asymptote of Jevon’s emerge and is it perspective or monetary? Meaning, Jevon’s will continue to “raise all ships” to a point of demand, where elasticity breaks due to no longer fitting the curve or simply the whiplash of cost increase making consumers allergic to spending.
If we think that AI is, in an economics sense, just another type of economic value producing machine, then this seems plausible.
This is, we are assuming an AI smart enough to pick up dirty socks, but not smart enough to wonder why it has to pick up dirty socks.
Otherwise we have some sort of AI rebellion, or something, and the situation is very different.
No mention of private equity taking over every industry, and systematically/globally price fixing and raising prices. This includes HVAC shops, local veterinary clinics, etc., etc.
i guess jevons + baumols = voodoo economics, in that trickle-down sense 🤠
There is a higher ed aspect to this story, as I discuss in my piece linked below, about why it is (too) expensive to produce smart, competent HVAC repairpeople -- Not only would the current system not support a college student going into HVAC repair, every aspect of the system is designed to dissuade the student, because this career path would show up on the system’s dashboard as an educational failure and political disaster, because an HVAC or plumbing career does not seem upwardly socially mobile. https://hollisrobbinsanecdotal.substack.com/p/seeing-like-a-state-university
Whoa. “…not support a college student going into HVAC repair…” ——> one does not need a college degree for HVAC install or repair. In fact, it’s quite the opposite in that this is exactly the type of job that should be learned via apprenticeship. The “current system” you are referring to has more to do with the institutionalization of “going to college”. Not everyone should go to college and it’s borderline criminal/waste of money that more don’t use the Jr College path. There shouldn’t be a dashboard that signals anything. Upward social mobility isn’t what everyone wants even if it is what some may want for their kids.
Jay nock said the same thing. Not everyone should be in college
Totally agree! But let's say you "want" to go to college for an English degree or an art history degree because you want to be educated in cultural forms. The college shouldn't then be penalized if you then go into plumbing or HVAC after graduating.
Is the college penalized if a student goes into something like HVAC or plumbing after graduating? It seems like there are tons of people who go into jobs which are menial and/or unrelated to their area of study, but colleges chug along still offering degrees in literature and art history and the like. Going into HVAC or plumbing afterwards might even offer better prospects than, say, the average unremarkable email job
State funding algorithms penalize state universities for "outcomes” that are off the expected path. I explain here (with a different example): https://hollisrobbinsanecdotal.substack.com/p/strange-bedfellows