Joseph Schumpeter on Gyan giving intellectuals

Joseph Schumpeter on Gyan giving intellectuals.

Excerpted from

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Have you ever wondered why so many intellectuals and academics are often left leaning and drawn to socialism? Well, it has to do with a hero complex. There's an economist by the name of Joseph Schumpeter and he explained this really well in one of his books, "Capitalism, Socialism, and Democracy". He explained that highly developed industrialized capitalist societies create enough abundance to produce a large quantity of this intellectual class.

And these people are like journalists, college professors, lawyers, political theorists, academics, and they're often very resentful of capitalism. And this resentment usually stands from the fact that capitalism mostly rewards entrepreneurs, inventors, merchants, and businessmen, people who actually produce real goods and services for society. It doesn't do much to reward these intellectuals because most of them don't produce anything. Their products are usually ideas, critiques, and theories about society and how it should function. 

And because they don't actually solve any real problems, their easiest path to influence them is by criticizing capitalism. Think of people like Michel Foucault, Noam Chomsky, Herbert Mercouzo, and most notably Karl Marx. And because they believe that they're actually smarter than most people they often feel that capitalism doesn’t properly reward them for their intellect but under socialism it will be different because they be more valuable and since socialism needs a lot of bureaucrats experts’ economic planners, ideologues, and guiding intellectuals.

So, it gives them the starring role that they don't have in a market economy. And on top of that, they also don't suffer the consequences of their own failed ideologies. You see, unlike an engineer who's built a bad product, you can see in real time if that product works or not. And if it doesn't, then you have to go back and try to fix it.

But for these intellectuals, their product is their ideas. So, they can be catastrophically wrong and then still get to keep their careers. And if their ideologies and predictions fail, they can always write a new essay explaining why it wasn't real socialism or that somebody implemented it wrong. Because they have no skin in the game, there's no limit to what they can come up with.

It's like the adage, hard time create good men, good men create good times, good times create soft men, soft men create hard times. And I know this is kind of freaky, but I think this actually matters a lot. When you look at what AI is going to do, it's going to really replace the need for a lot of these intellectuals and what's going to be the highest thing in demand.

Somebody who has creativity, leadership capacity, and the appetite for risk enough to use these tools to build something for the world. Yeah, look at where the puck is going, guys. If you're one of those people who resent capitalism now, buckle up, it’s only going to get more challenging.