Ray Dalio’s latest missive
Every day I see examples of how our pursuit of short-term self-interest is being taken to such an extreme that it is threatening our long-term self-interest.
For example, yesterday I read this article which explains how the wanton dumping of trash in the ocean is ruining the ocean. This will most likely continue and the trash won’t be cleaned up because the cost of cleanup is immense. That uncivilized behavior is only one of a number of ways that we are treating the ocean as our toilet that we are also over-fishing in. This is being done to such an extent that it won't be long before the ocean will become polluted and barren, thus threatening our civilization. It’s tragic because the ocean would flourish and support us if we took just a bit more care and put a bit more money into its care (such as throwing trash in bins and using biodegradable containers).
The same is true for how we treat the environment as a whole and how we treat each other. In other words, it seems to me that we are behaving in an uncivilized, unsustainable manner that pushes the pursuit of short-term self-interest to such an extreme that it is threatening to our civilization—and, that if we dialed the degree we pursue our short-term self-interest back just a notch to invest a tiny bit more effort and money to take care of others and the environment, it would be in our long-term self-interest.
In dealing with each other, it would take only a small share of the income of those who have a lot to provide a lot of missing basics for education, civilized conditions, and job opportunities, which would reduce crime, incarceration rates, health problems, and the risks of social revolution. That is because the incomes of those at the top are so large relative to the incomes and expenses of the majority of people. To get a tiny taste of what our society is not providing in just one of these areas, education, go to donorschoose.org and see what teachers are requesting that they don't have to educate our children. More broadly, as shown in my examination of the conditions of the bottom 60pct of our population, there is reason to argue that capitalism is not working for the majority of people, which threatens the existence of capitalism.
By the way, I said that to a number of my fellow capitalists at Davos and, interestingly, almost all of them agreed with me. We also agreed that almost nothing is being done about this, so the risks of social conflict occurring when the next economic downturn comes along are significant.
These are just a couple of examples of a) how our extreme and not well thought-out pursuit of self-interest is causing unacceptable risks to what we cherish and b) how, if people dialed back their pursuit of short term self-interest and gave a tiny bit more effort and money to taking better care of each other and the environment, it would be in our long-term self-interest. I believe that such civilized behavior will help protect our civilization while uncivilized behavior will threaten it.
I'm wondering, do you by and large agree with me? If we agree on the problem, we can then move on to explore what might be done to reduce or eliminate it.
P.S. Btw, as far as principles are concerned, what I’m talking about here is the common mistake of overweighing near-term first-order consequences relative to longer-term second- and third- order consequences.