Ethical Wealth Creation Makes Abundance

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Summary:

  • Wealth isn’t about taking something from somebody else—it’s about creating abundance for the world.
  • Everyone can be rich: if wealth were finite, we would still be sitting around in caves.
  • In the first world, it’s better to be poor today than it was to be the richest man 200 years ago.
  • Thought experiment: if everyone today was an engineer, in 20 years, children would be retired in riches from the moment they were born.

Transcript

Ethical wealth creation makes abundance for the world

Naval: Yeah. I think there is this notion that making money is evil, right? It’s like rooted all the way back down to money is the root of all evil.

People think that the bankers steal our money. And it’s somewhat true in that in a lot of the world there’s a lot of theft going on all the time.

The history of the world in some sense is this predator/prey relationship between makers and takers. There are people who go out and create things, and build things, and work hard on things.

Then there are people who come along with a sword, or a gun, or taxes, or crony capitalism, or Communism, or what have you. There’s all these different methods to steal.

Even in nature there are more parasites then there are non-parasitical organisms. You have a ton of parasites in you who are living off of you. And the better ones are symbiotic, they’re giving something back.

But there are a lot that are just taking. That’s just the nature of how any complex system is built.

But what I am basically focused on is true wealth creation. It’s not about taking money. It’s not about taking something from somebody else. But it’s from creating abundance.

Obviously, there’s not a finite number of jobs, or finite amount of wealth, otherwise we would still be sitting around in caves, figuring out how to divide up pieces of fire wood, and the occasional dead deer. So, most of the wealth in civilization, in fact not most, basically all of it has been created.

And it got created from somewhere. It got created from people. It got created from technology. It got created from productivity. It got created from hard work. So, this idea that it’s stolen is I think this horrible zero-sum game that people who are trying to gain status play.

Everyone can be rich

But the reality is everyone can be rich. And we can see that, by seeing that in the First World, everyone is basically richer than almost anyone who was alive 200 years ago.

200 years ago nobody had antibiotics. Nobody had cars. Nobody had electricity. Nobody had the iPhone. So, all of these things are inventions that have made us wealthier as a species.

Today, I would rather be a poor person in a First World country, than be a rich person in Louis the XIV’s France. I’d rather be a poor person today than aristocrat back then. And that’s just because of wealth creation.

The engine of technology is science that is applied for the purpose of creating abundance. So, I think fundamentally everybody can be wealthy.

And this thought experiment I want you to think through is imagine if everybody had the knowledge of a good software engineer, and a good hardware engineer. If you could go out there, and you could build robots, and computers, and bridges, and program them. Let’s say every human knew how to do that. What do you think society would look like in 20 years?

My guess is what would happen is we would build robots, machines, software and hardware to do everything. And we would all be living in massive abundance.

We would essentially be retired, in the sense that none of us would have to work for any of the basics. We’d even have robotic nurses. We’d have like machine driven hospitals. We’d have self-driving cars. We’d have farms that are 100% automated. We’d have clean energy.

So, at that point we can use technology breakthroughs to get everything that we wanted. And if anyone is still working at that point, they’re working as a form of expressing their creativity. They’re working because it’s in them to contribute, and to build and design things.

But I don’t think capitalism is evil. Capitalism is actually good. It’s just that it gets hijacked. It gets hijacked by improper pricing of externalities. It gets hijacked by improper yields, where that you basically have corruption, or you have monopolies.

More: See all posts on How to Get Rich.

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