Capture Your Value

As classic movie POOR STRESS DRINK demonstrates, it’s not just the “American” Dream: everyone everywhere dreams of becoming somebody. (Even the rat-faced man isn’t averse to highly remunerative work—indeed, every good rat is always on the make.) And everywhere, the dream is to work hard and get ahead. HAPPY! WIFE LOVES HIM!

And yet, one wonders why this guy started DRINK in the first place. Did he become POOR and STRESS because he was DRINK, or was he DRINK because he was POOR and STRESS? And if the latter, why was he so POOR and STRESS in the first place?

We might naively believe that living standards have been on the rise for a long time. That’s one of the evidentiary legs supporting of the standard account of history that Americans used to learn in school (before Howard Zinn et al. showed up to teach us that we are actually Cthulhu.) It’s basically “Daily Affirmations” as a philosophy of history: “Every century, in ways both complex and elementary, the liberal democratic welfare state is getting better and better!”

But actually, it turns out that Whig history is total crap: “Dark Ages” Europeans were almost as well off as moderns, and considerably better off that 18th century Europeans, in terms of availability of basic goods. The dung-delving churls we imagine after seeing Holy Grail ate a lot better and more regularly than all those jerks in Les Misérables.

To be fair, when you see what starving manlets they were, you can understand why they were so miserable. Because it turns out that the mob of late 18th-century Frenchmen who stormed the Bastille were around five feet tall and 100 pounds, or to put it differently, they looked like a mob of thirteen-year-old girls. Next to them, a six-foot medieval warlord like Charlemagne would have stuck out like Andre the Giant in Japan.

“But wait a minute,” your Whig-trained brain is saying. “Why did this happen? Weren’t the Dark Ages, like, really dark? Didn’t everything go to hell after the fall of Rome? Some guy on Reddit showed me a chart!” Yeah, well, about that. It turns out that there’s a lot more to high living standards than the level of scientific knowledge possessed by the top 1% of geniuses. After all, the USSR had great scientists but, take it from me, you wouldn’t want to live there. But more generally, it turns out that increases in productivity are usually followed by increases in population that gobble the gains back up. Instead of seeing a stable population with an increased standard of living, we see an increased population with a stable (and horribly low by today’s standards) quality of life.

What’s more, medieval peasants generally kept more of what they made than 18th century peasants did. The chaos and disorganization of medieval administrations worked to the advantage of the guy who quietly got up every day to plow his field, pluck his chickens and plow his wife without engaging with the state in any way. Ideally, from his point of view, they’d leave him alone for a while and he’d go ahead and produce a bursting granary, smokehouse, brewhouse and wife, because everything he did was productive. But it was precisely this productivity that the state wanted to capture, because the aristocracy’s reason for being was conspicuous, wasteful consumption. Heh heh, good thing we don’t have that going on any more, amirite? We can guess where Daddy’s money comes from for these swanky lifestyles.

And that brings us back to POOR STRESS DRINK. Turns out that Thailand, where it takes place, is an absurdly unequal place. In real life, our protagonist would be taxed into oblivion, expropriated by a general’s brother, or stuck in a debt trap under the thumb of the village moneylender. (Hence the brief nod to PAY DEBT—the village moneylender is the scourge of peasant life in southern and southeastern Asia, and the PSA takes it for granted that a peasant, much like a Millennial, is always in debt.) In short, it is a half truth. Peasant dude isn’t going to get ahead without hard WORK, but the ideal situation from the point of view of people who write PSAs is that he WORK hard but they capture the profits. It’s in both his interest and theirs that he STOP DRINK and WORK, but they’d prefer that he PAY DEBT over and over; if he IMPROVE SOCIAL too much, he might start wondering why exactly he lives in a shitshack on an unpaved road in this, the current year.

What can we learn from this? Well, basically, work produces value, but for you, the capture of value is much harder than its production. Your work probably produces positive externalities that aren’t returning to you in any significant way. (If nothing else, you’re paying into social supports for Boomers that you’ll never enjoy yourself.) It’s not so different from company scrip or other similar scams—those were about capturing the employee’s produced value.

What’s more, the system is designed to keep you from noticing how the issues are framed. We’re encouraged to believe that “the system works” when in fact non-clueless people milk the system shamelessly. Just being close to power can be higher value than the entire productive capacity of a square state full of highly productive but naïve and square-headed people still living in a mental world of public-spiritedness, small-town honesty and quiet, humble, good deeds. (Notice that “higher value” need not have anything to do with “more productive”).

The key term to Everyman’s dream all over the world, whether he’s Joe Lunchpail or Sarawut Ricebowlpipatpong, is value capture, not merely value production. If you aren’t capturing your value, odds are it’s going to some rat-faced man. Better figure out how to become your own.

8 thoughts on “Capture Your Value

  1. But more generally, it turns out that increases in productivity are usually followed by increases in population that gobble the gains back up. Instead of seeing a stable population with an increased standard of living, we see an increased population with a stable (and horribly low by today’s standards) quality of life.

    Aren’t native populations in advanced countries declining (or barely replacing themselves)? Are you assuming population increases from immigration?


    1. Good q. Let’s start by taking a step back. It’s normal for the population-to-resources ratio to fluctuate over time, but one of the surprising findings of economic history is that it fluctuates around a Malthusian baseline. Populations rise over time, generally lagging availability of food resources but catching up to them. Thus, there are intervals when living standards rise, but such rises are always followed by increases in population.

      To put it another way, cavemen ate more calories than a lot of 18th century industrial workers. Yeah, there were the whole “murdered by rival tribes” and “dying of random infections” things, and I’m not exactly arguing that there were no salient improvements in QOL from 10,000 B.C. to 1800 A.D., but I am saying that the physically stunted urban proletariat of 1800 A.D. was objectively malnourished in comparison to an average of all humans who had ever lived.

      As for the situation today, we are in the biggest gap ever observed between increase of food sources and conversion of excess food into increased baseline population. There is still a huge boom in human population underway due to artificial nitrogen fixing and Green Revolution and its progeny. Right now, it looks like the short-term effect is ballooning population in the developing world, particularly in Africa (the top 15 nations by fertility are all African, as are 28 of the top 30.) Whether this boom will net out to immigration to first world countries is beyond the scope of this blog.


      1. But if the 3W boom doesn’t result in increased 3W–>1W immigration, then the 1W will have seen productivity skyrocket, with population stable-to-declining…right?

        (Obviously even if 3W are the primary beneficiaries of the “green revolution,” 1W has had its own productivity boom; e.g., we now have more efficient tools with which to write PSAs).


  2. Peasant dude isn’t going to get ahead without hard WORK, but the ideal situation from the point of view of people who write PSAs is that he WORK hard but they capture the profits.

    I suspect this is a part of why the third world lags in productivity (in addition to the obvious). It’s not that they’re lazy, per se, it’s that they know better than to work hard when they won’t reap the benefits. And as you say, this is increasingly true here. I wonder how long it’ll take Americans to wise up, and what will happen to our standard of living when they do.


    1. Either America will become a nature of hustlers or Americans will collapse into an apathetic “Slough of Despond” passivity. You can guess which outcome I’d prefer!


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