In which Andy Haldane envisions the coming of Kubrick’s star child


From a speech last week by the BoE’s chief economist Andy Haldane.

Economist Brian Arthur has a beautiful metaphor for describing this transition – the transition from a physical (or “first”) economy to a digital (or “second”) economy.47 He likens earlier industrial revolutions to the body developing its physiological or muscular system. By analogy, the economic system was defining and refining its motor skills, largely through investment in physical capital.
The digital revolution is different. It is akin to the economic body developing its neurological or sensory system, defining and refining its cognitive skills through investment in intellectual capital. The success of the recent wave of transformative technologies is built on them creating a neural – brain-like – network of connections. The “internet of things” uses multiple sensors (like the brain’s neurons) connected through the web (like the brain’s synapses) to create, in effect, a machine-brain.
It is that brain-like wiring which has given rise to thinking, as well as doing, machines – the move from Artificial Intelligence (AI) to Artificial General Intelligence (AGI). In the words of Brynjolfsson and McAfee, we are entering a second machine age.48 Moreover, Moore’s Law means that the processing power of the machine brain is ever-rising. That leads to the intriguing possibility that, at some point in the future, the processing power of the machine brain could exceed the human brain.

Humans evolved from mammals, and mammals evolved from aquatic life (yes, yes there were reptiles somewhere in between as well — I’m not a biologist), but this evolutionary process was only possible once a habitat that could support living systems was established. The establishment of that habitat involved a significant atmospheric change which itself was only made possible by the rise of complex oxygen-producing cellular structures: plants, which themselves only evolved once the process of photosynthesis was established. Somewhere algae played an important role as well.

To sum up: each evolutionary leap involved an incremental rise in complexity, cellular organisation and information sharing. Arguably, also, each leap brought with it a new level of consciousness, which built on the consciousness achieved by the previous less complex organism that had come before it.

Furthermore, this new consciousness often depended on successfully mastering and/or exploiting the lower forms of consciousness (in the great darwinian food chain sense).

So the question now is where is evolution taking us next? A new higher level of human? (A view that appeases our centrist human perspective on all things.) Or, alternatively, a new class of being entirely? One in which humans play only the role of a cellular cog — to be exploited by the higher consciousness formed by the process?

See here for some of my previous thoughts on the matter.

In any case, as Haldane notes, this opens the door to the sort of evolutionary leap that technologists call the “singularity”:

Were the singularity to be reached, the sky becomes the limit innovation-wise. Machine, rather than man, then becomes the mother of all invention. With exponential rises in processing power, the economy could become “super-intelligent”. And with close to zero marginal costs to expanding processing capacity, it may also become “super-efficient”.
This would indeed be a fourth industrial revolution. But unlike its predecessors, and almost by definition, it would be near-impossible for the human brain to imagine where the machine brain would take innovation, and hence growth, next. The world would be one of blissful ignorance. The excitement of the optimists would be fully warranted.

But as Haldane also notes, even if humanity cannot perceive the higher consciousness that’s forming beyond its sensory range, we will still have to exist in a social system that supports and feeds that higher consciousness. How we order that system, therefore, could determine whether our new subservient state in this new consciousness order is tolerable or intolerable.

So far, notes Haldane, it’s not looking good for the common man because technology is doing little to help keep the human system balanced.

In fact, he notes, we may be re-wiring our brains in a such a short-termist way that the quality of our consciousness is already regressing.

From Haldane:

A third secular, sociological headwind concerns short-termism. That sits oddly with historical trends, which points towards secular rises in societal levels of patience, in part driven by technological trends. But those trends may themselves be on the turn. Just as the printing press may have caused a neurological re-wiring after the 15th century, so too may the Internet in the 21st. But this time technology’s impact may be less benign.

We are clearly in the midst of an information revolution, with close to 99% of the entire stock of information ever created having been generated this century.64 This has had real benefits. But it may also have had cognitive costs. One of those potential costs is shorter attention spans. As information theorist Herbert Simon said, an information-rich society may be attention-poor. The information revolution could lead to patience wearing thin.

This echoes my own opinion that Silicon Valley technologists are nurturing dangerous instant gratification expectations in all of us, and working hard to convince us that such instant gratification comes at no cost to the whole. In their view “we can have it all” despite the fact that human experience depends on quality interactions which by their nature are impossible to mass produce if they are to be valued. I think it’s clear that in a closed system one person’s instant gratification must come at the cost of another person’s non gratification or worse than that, their free will. Nevertheless, the mantra from SV is that the digital commons has created a magic positive sum world where no one needs to be patient, because temporal delays are no longer an issue for anyone. Or at least for the 1 per cent they care about.

It’s as if the entire float of human consciousness — our suspended patient state in which we work to overcome inefficiencies — becomes unnecessary. Which is weird because the thing we value most, money, in many ways represents nothing more than a suspended float and sum of our inter-temporal inefficiency and human variance.

Which is why, Haldane notes, these technologists possibly under appreciate the paradox that comes into play as soon as we begin to think we can have it all and no longer pause for thought or appreciation of the journey:

Using Daniel Kahneman’s classification, it may cause the fast-thinking, reflexive, impatient part of the brain to expand its influence. If so, that would tend to raise societal levels of impatience and slow the accumulation of all types of capital. This could harm medium-term growth. Fast thought could make for slow growth.

Psychological studies have shown that impatience in children can significantly impair educational attainment and thus future income prospects. Impatience has also been found to reduce creativity among individuals, thereby putting a brake on intellectual capital accumulation. Innovation and research are potential casualties from short-termism.

There is evidence suggesting just that. Investment by public companies is often found to be deferred or ignored to meet the short-term needs of shareholders. Research and development spending by UK companies has been falling for a decade. They are towards the bottom of the international research and development league table (Chart 16). If short- termism is on the rise, this puts at risk skills-building, innovation and future growth.”

I’ve just been reading Zen and the Art of Motorcycle Maintenance by Robert Pirsig and the above really resonates with the message of that book. In some ways our human condition is underpinned by the concept of quality. If we don’t take our time over things, if we don’t strive to do things properly or better, if we don’t bother learning technique or craft, if we don’t learn to enjoy the journey of life itself, we give up on life and what it means to be human. In short, we regress to a lower form of consciousness.

Though Haldane puts it in a more Hari Seldon-esque way:

Growth is a gift. Yet contrary to popular perceptions, it has not always kept on giving. Despite centuries of experience, the raw ingredients of growth remain something of a mystery. As best we can tell historically, they have been a complex mix of the sociological and the technological, typically acting in harmony. All three of the industrial revolutions since 1750 bear these hallmarks.

Today, the growth picture is foggier. We have fear about secular stagnation at the same time as cheer about secular innovation. The technological tailwinds to growth are strong, but so too are the sociological headwinds. Buffeted by these cross-winds, future growth risks becoming suspended between the mundane and the miraculous.

To me that means: if we are to progress sustainably — or at the very least achieve a healthy steady-state — we must not give up on the pursuit of quality and/or purpose.

That means we have to very purposefully focus on bringing latency back into our lives.

I’m going to start by rationing posts to no more than four a month in a bid to protect all our attention spans.

Jedi guild councils – how the platforms of tomorrow should look

The bulk of today’s “sharing economy” is anything but. Instead what we have is a fast proliferating fad for platforms that claim to be built on the principles of a collaborative structure but are in fact thinly disguised monopolies designed to draw rents from the hard work and sweat of crafts/trades people. It’s pure exploitation that will inevitably lead to a subsistence existence for most workers.

Something needs to be done.

I propose a viable and honest alternative model which can be executed by any craft or trade. Understandably, since it’s a non-profit structure, it’s a much harder concept to bring to market because those who believe in it (like me) don’t have access to capital or development resources. But I do think that once the initial hurdle is overcome, it’s a long-term sustainable model for all sorts of varying professions.

Nevertheless, the non-profit structure doesn’t appeal to VCs, funders, banks or any other type of investor. But that doesn’t mean there aren’t viable investments to be made that can — and this is a fair offer in a negative interest world — protect capital from erosion.

Attached is one idea I came up with*. The key point is that all these organisations could be managed and operated in a guild-like structure, it’s just a question of organising the practitioners of the craft effectively. Think of my proposal as an example of how it could be done.

A key point to bear in mind is that whilst this sort of platform encourages healthy competition, it remains purposefully protectionist to ensure that those who wish to draw a livelihood from perfecting real skills, trades or crafts with a focus on quality and sustainability (not just making clickbait), can do so without relegating themselves to a serf existence. The structure, if done right, could empower all sorts of middle-class professionals. It’s best to think of it as a digital professional union than a company per se.

* I am not an entrepreneur (or a particularly good chef) and this is not intended to be a sales pitch. At the moment this plan is going nowhere because I don’t have any resources to make it happen. And whilst I tinkered with it for a while I think it poses too much of a conflict of interest to be a business developer and a journalist. So it’s on ice. Nevertheless I’m interested in feedback.

The new global “savings glut”

I’m reading Andrew Keen’s book, “The internet is not the answer” (really enjoying it, and do recommend it), and something has just occurred to me regarding the shape of global imbalances to come. It’s in keeping with the point I was getting to in the Nesta essay I wrote.

So here’s a prediction based on that revelation.

The great global imbalances of the last few decades have been caused by an unequal distribution of energy. So, those countries which had control of large easy-to-tap energy resources — whether they were fossil fuels, as per the surpluses of the oil producing countries like Saudi Arabia, or sweat fuel, as per the surpluses of the under privileged human capital countries like China — held those countries which demanded those resources or had the know-how to employ those resources under a type of bondage.

But technology has and will continue to disrupt that power imbalance, and in the process it will transfer the power and leverage that comes with ownership of a resource that everyone wants to the technology companies themselves.

On that basis, I predict, as the global imbalances that have plagued the global economic system for decades inevitably begin to unwind, they will inadvertently be transferred from sovereign balance sheets to corporate ones.

In some way we already see this happening in the great cash piles of Apple and Google. The stock of these companies can as a consequence equate to a quasi corporate currency — a public currency float — that could be pretty darn fungible (and stable) if those corporates felt inclined to deploy it in that manner. It could easily be pegged to the dollar as well.

The only difference between the sovereigns and the tech corporations is that the latter don’t control regions in the same way and are still subject to the laws of the land. That said, if they structure and ally themselves smartly, and round up their own armies (google robots?) we could see the reemergence of a new Hanseatic League, complete with a robotic Teutonic order to defend its interests. Though this time the core beneficiaries will be a much smaller number of people than in Hanseatic days.

Attention collateral

Those familiar with my writing will be aware of the fact that I am growing concerned about how the digitisation of the economy is leading to instant gratification expectations everywhere, which in turn is having a profound and destabilizing effect on one of our most precious human resources: attention.

It is simply impossible to do a task efficiently or to enjoy the human experience when distracted to the degree that we are today by everyone preying on our attention.

The Internet opened the information floodgates, but what we didn’t appreciate is how much rubbish was in that water flow.

The success of the digital economy depends on us reprioritising information and filtering it more efficiently.

Which is why I propose collateral-backed email, skype, whatsapp, sms and so forth.

Basic concept: unless you attach proof of a $5 deposit into a third party escrow account, your email will not get through my primary filter.

The more rammed my inbox is, the greater the cost to penetrate through it.

To those shouting “this is elitist! Non-sensical! Who wants to charge their friends and family for email!” Well a) your core immediate friends family can be excused from the collateral burden.

B) I’m talking about collateral not a fee! This is about increasing the cost of spam for spammers, shills and conmen. Think of it as a repo arrangement. If you attach a $5 deposit to my email, and I reply to it, your collateral is returned. The collateral charge only applies to unsolicited email or that which becomes too one sided in an average exchange.

That way those (PRs etc) who insist on spamming us, have to set aside a lot of capital for the ability to do so. The manipulation of the public sphere by sheer volume-related info dumping and mass multiplicity of messages will be prevented. If a message is deadly important there are mechanisms that way to have it arrive at the top of your inbox as well.

It’s free of corruption as well because replying to the email doesn’t transfer the collateral to your own account but rather releases it back into the pocket of the sender.

What’s the cost to someone who attaches a hugely expensive bit of collateral that gets ignored? The collateral remains in limbo for a set amount of days/hours before it is released back. That prevents the spammer from being able to respam you instantaneously.

Anyway that’s just one idea. But (IMHO) something of this sort needs to be done pronto.

(I imagine within private communication networks like corporations CEOs and managers, and even colleagues, would have the ability to override these filters. I’m talking predominantly about unsolicited messages coming from external accounts. I imagine if you enjoy getting a daily report or something of that order you could also override the collateral need.)

(Post written on an iPhone whilst trying to do many other things at the same time so apologies for typos/dyslexic brain.)

*** information you openly solicit meanwhile should carry a negative repo charge. Namely a fee for those creating it. Though this time it should be a fee. Neutral information mediators (aka journalists) have life costs they need to break-even on.

Self organising scam systems

Bitcoin is, as expected, evolving into an even worse version of the standing system.

Basically, just when the hard working population took notice of how the banks failed and took advantage of them — and moved to regulate and control them — a new system sprung up to take their place confirming PT Barnum’s incorrectly attributed quote “there’s a sucker born every minute” and the premise that as long as we dress the scam up theatrically or with great marketing skill, we can capture a whole new generation of suckers that haven’t been burnt and informed by the previous cycle.

Over time, of course, people will figure this out and take exactly the same interventions that they have taken in the standing system. And then no doubt another system will show up and do exactly the same thing over again, because a properly regulated system simply does not provide the sort of windfalls that people who don’t like to work for their living like to receive.

What I find interesting is the nature by which Bitcoin is replicating not just the regulatory processes we have applied to our incumbent system (albeit at the self regulatory, still corrupt, phase) but the government system it claims to hate.

Some key observations.

1) the complexity and non-scalability of Bitcoin has made it depend on exactly the same type of fractional reserve tiering towards trusted third party intermediaries that it claims to hate if it is to grow and be accepted by the masses. Left unregulated these systems will repeat the mistakes of the current system and implode.

If, however, they embrace regulation, honest and transparent practices they won’t be nearly profitable enough to make it worth their while competing with the pre-existing highly regulated system.

Won’t stop them pretending to embrace regulation because there’s still a very profitable intermediary period to be exploited, during which they can pretend to be doing a good job regulating themselves until it is proven they can’t be trusted to do that job.

2) the constant scamming is generating calls for risk insurance and risk management so as to better compensate victims. Who will pay for this insurance fund, however, is yet to be determined of course. And it seems to be entirely lost on the community that if an insurance premium is distributed equally amongst users this kind of like a … Errrr … A social tax or a FDIC fee.

3) the system it turns out isn’t that cheap at all, and it’s becoming patently obvious that some sort of well funded central party with possession of REAL ECONOMY claims will be needed to maintain stability and to defend the break even rates of the processors and ledger keepers. Who will those parties be? Surely not the primary Bitcoin dealing intermediary institutions who have the power to create side chains and thus fractionally reserve money supply when they feel the system can handle it and inject capital from their collective reserves when they feel the system is tanking?

4) investments into the system at this stage are tantamount to mini bailouts. Unfortunately the system hasn’t figured out that given the chronic cash burn and the non conditionality of those bailouts, they will never be enough to plug the system.

5) when you’ve got loads of coins to dump there’s no better sttategy than creating your own exchange where you can manipulate prices. Even better if that exchange can be Centralised! Yay, no irony there with the latest Winklevoss exchange.

6) the community’s tactics to increase adoption involve giving away free coin to users who were not fortunate enough to be early adopters. That this totally creates a voluntary tax system which transfers wealth from rich asset holders to the wider public with no conditions is lost on the community. Libertarians might say “well at least it’s voluntary!”. But I will eat my hat if over time the good citizens of bitcoinland who are constantly and benevolently giving away Bitcoin for the sake of “adoption” won’t get fed up with those who do nothing of the sort and will call for a much more equalized form of philanthropic coin distribution from all wallets on a fair proportional basis. When that happens of course we will have finally come full circle to establishing a tax system. What still has to be determined at that point is how that money should be distributed and to whom. At which point the Bitcoin government will be structured, and will no doubt be subject to the same crony capitalistic influences that bitcoiners love to complain about.

Ahhhhh… The joy of Bitcoin.

Two last points, I am not at all surprised that a $75m injection into the system, including expert advice from electronic trading masters who were able to create the conditions that allowed oil to be squeezed to $145, will lead to a temporary surge that will recapitalize the system just long enough to pay the salaries/costs of a bunch of miners who might otherwise pull out before the system is saved by the great scalability fork event.

Shame the fork event is actually amounting to a civil war between bitcoin’s own emerging equivalents of the republican and democrat parties.

For those not clued up on the debacle a quick lay man’s summary is: the block size has a real world limit and it’s filling up quickly because bitcoin’s uneconomic cost structure means people are taking advantage of the system to ram all sorts of needless spam for processing and safekeeping. Once the limit is reached miners will have to chose which transactions to include and which to dump. Naturally only fees will help guarantee inclusion — something which stands to make the system really expensive really quickly. And if you think it is hard to get people to take Bitcoin now, imagine how much harder it will be when the fees are even higher than anything charged by the established banking system.

So there is now a schism in the community.

On one side you have the Bitcoin Republicans who think it’s actually good for Bitcoin that there’s a limit that forces real economic forces to create a fair and compensatory cost structure.

On the other side you have the Bitcoin democrats who want to subsidise the miners by charging what might as well be called a corporation tax to key system beneficiaries (I.e. Bitcoin’s most profitable companies).

Who will win? Nobody knows! All we know is there will be a referendum at some point and it will be the miners who decide with a good old fashioned Bitcoin 51% vote.

We are now in the election campaigning phase.

Though, it should be pointed out, unlike a real political vote there is no jurisdiction being fought over. Which is why the most likely outcome will be an evolutionary style fragmentation. Think of it like a Sunni/Shia ideological divide, with both sides turning against each other in a bid to prove they are the better system.

This is inevitable because there is no social agreement — as per conventional politics — that the winning fork should only be a temporary solution, to be tested for say … four years, and then voted upon again.

(Sorry for typos/literals. Written on an iPhone)

Man of marble and of code

Over the course of the last few weeks I’ve been quietly testing a theory on a number of trusted sources, friends and acquaintances whose opinions on economic and technological matters I value.

The hypothesis very loosely speaking is that the Internet revolution was founded on an extremely precarious and highly politicised social equilibrium which may not be as robust as we like to think it is. Our failure to understand this presents us with a false sense of security.

Don’t get me wrong. We’ve clearly benefited from the Internet in amazing ways and it has allowed us to achieve things that were previously unthinkable.

But…. I am increasingly concerned that we have all overlooked the precarious nature of the system we have created, how dependent it is on collaboration and how vulnerable that makes us in the long run if those social systems fall apart.

What we have been experiencing in terms of benefits and advantages is akin to a Bob Geldof-organised charity concert.

I.e. These concerts reveal precisely what we as a social group can achieve if and when we actually choose to a) all get along b) act in a United way and c) focus our efforts on one particular benevolent and altruistic effort.

But it’s also something that is by definition a bit of a one off event.

No doubt what we can achieve is mind blowing. Like building the Tower of Babel.

But the problem with charity concerts is that after a while we do all want to go home and get back to our own selfish existence.

The web charity concert has now lasted nearly 30 years. That’s a very long time. But what we are starting to witness is the rise of increasingly exploitative and manipulative agents (hackers), not to mention proprietary businesses, all of whom don’t play by the collaborative rules and whose key focus is taking advantage of the goodwill within the concert for their own selfish purposes. They even label their companies “concert x y or z” to better manipulate us — not unlike the the cottage industry of unofficial vendors that spring up on the sidelines of concerts to try and charge you twice as much as usual to get home. That to me indicates the party may soon be over — unless, of course, we quickly find a better way to keep it protected from malevolent agents.

On that basis I increasingly side with the thoughts of Jaron Lanier. If we want the concert to continue we’re going to have to start compensating people for taking part in the concert, for concert fatigue and for holding themselves back from returning to their old lives.

Climateer linked to this story on Motherboard about a new book by Andrew Keen that argues a very similar point. Namely that the web Revolution has led to the creation of a very weird form of capitalism (which in my humble experience resembles increasingly the story of Animal Farm).

From the article:

In his new book The Internet is not t​he Answer, Keen rubs up against the “Silicon one percent” to document what he sees as a profound hypocrisy—an elite made wealthy by the internet, co-opting the language of “community” while privatizing public life in every direction.

“You’ve got wealthy Oakland residents crowd-funding thei​r own militias,” he told me in a phone interview. “Google have superimposed Google Bus on San Francisco’s public transit system. These companies are eating away at the idea of public society.” The so-called Google bus is the private shuttle service that recently​ sparked protests as a symbol of gentrification and over the way it used public stops.

Profound hypocrisy I think is a great way to put it.

Now, I am not by any stretch of the imagination a tech expert. I can’t even code. Apart from some very very very very basic html.

But outside perspectives are important and can offer valuable insight on matters precisely because insiders sometimes are so indoctrinated they can’t see the glaringly obvious at all.

Yet, interestingly, what I am quickly discovering is that the tech community is extremely sensitive about any outside observations that dare to question the collaborative foundations of the web and in particular the sacred cow nature of “open source” culture.

He who dares to question the logic and long-term viability of “open source” systems is cast out, trolled or slandered

To me, as a child of Polish extraction who experienced the Soviet System first hand, that reminds me of the indoctrination of the masses who refused to see the hypocrisy of the Party and even defended their meager way of life, attacking those who tried to expose the inequality of the system.

My second observation is that pointing out the hypocrisy of proprietary systems built on open source efforts (or even government funded tech) is as grossly taboo as was pointing out the hypocrisy of the Party members who drove around in Mercedes Benz.

Just replace the bricklayer in Czlowiek z Marmuru (Andrzej Wajda’s Classic) with a coder and I think you get the picture.


What little I know about modern coding is that for the most part it’s become a bit of a copy and paste effort. At university that means kids aren’t actually taught to code from scratch (beyond the initial soduku puzzle) but how to bolt various prefabricated bits of code from GitHub into new structures. In my (naive) opinion, this can’t help but devalue the workforce who contributed to making that code in the first place and most importantly discourages the market from doing things a differently or more creatively. What’s more, since everything is built off the same blueprint what you end up with is a highly predictable and exploitable system, that can be taken advantage of by anyone who knows the blueprints.

Worse than that, just like with the soviet system, you end up with a grossly utilitarian structure which lacks variation and uniqueness. It’s variation and distribution that breeds resilience not prefab structures. Yet for all the tech community’s obsessions with distributed and decentralised systems, they’ve ironically ended up standardizing their methods in a way that is even more centralizing than a command economy system.

The head-less nature of the system they’ve created, meanwhile, (aside from the occasional tech gods who claim to speak in “technology’s” name) is another master methodology for stealth power consolidation. If the people can’t identify their enemy, they’re much less likely to rise up against him. If you keep them confused about who’s really to blame for anything they can never organise against the system that controls them. (I think that’s also partly Adam Curtis’ point in his new upcoming documentary).

I may be wrong about the Internet. I may be wrong about open source.

But what I don’t think I’m wrong about is the fact that the “uberisation” of the economy is tantamount to the road to serfdom and a huge and unforgivable abuse of the term “collaborative” or “sharing” economy.

These worker platforms should be run like guilds. If margins/commissions are to be collected they should be directed to amassing social benefits for the workers themselves from medical insurance to unemployment insurance. They should not entitle the developers who dared to hypocritically and defiantly slap proprietary claims on their systems to the revenues streams of a potentially global workforce, and a position in the global elite.

We need worker alliances that empower workers who share their skills and crafts with the world. Platforms which protect a minimum standard of life for all of them. Not ones which set them against each other so competitively that they end up eating each other’s lunches to the point there are no lunches left.

But I am open to and interested in hearing the other side of the story (providing, of course, those making the counter arguments have seen Fritz Lang’s Metropolis at some point).

Taking one for the team (investing in test-runs)

One addendum to the last post.

There’s an interesting parallel between tech investors claiming that those who lost or who may lose money investing in Bitcoin are effectively taking one for the team, for the purpose of the greater good and passive oil investors who clearly did take one for the team — the greater good in that circumstance being the knowledge of how to bring emergency carbon fuels into the system if really needed.

Both sets of crash and burn investments were needed for society to test-run these systems, learn from their mistakes, and hopefully come out better for it.

Now that’s been done the technological know-how can be bagged and deployed only as needed.

This makes the knowledge itself a new type of capital good. One that essentially adds useful processes to the grander knowledge banks of society. (Albeit in Bitcoin’s case, the knowledge earned is that the blockchain structure is self-defeating if it is structured around a profit incentive.)

Sadly, it also means that in this phase of the grander economic cycle markets do need permanent inflows of lambs to the slaughter/sucker investments who can be manipulated into funding the sort of paradigm-shifting social-good tech risks that are usually funded by government.

One way or another the market finds a way to socialise these risks. Government initiatives (like the space programme) spread the cost of knowledge acquisition for the purpose of social advancement across tax-payers, private initiatives spread the cost of knowledge acquisition for the purpose of social advancement across dumb investors/rentiers.