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1. Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:16:04 JST Nathan Schneider

   I've been working my way through Eric Balchunas's /The Bogle Effect/, on the founding of Vanguard. Hagiographic biz books like this are hard going for me, but it is important stuff, hopeful in some respects, and deeply saddening in others...

   🧵

   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:11 JST Nathan Schneider

     in reply to

     So, please. Keep in your pocket a few good stories that you can tell people when they tell you "there is no alternative." But also be ready to explain why our system actively prevents people from replicating and building on those good stories. Be ready to explain that we could have nice things, and here's how, but we are preventing ourselves from doing that, and here's why.

     And be sure to listen to what they say back, closely, and learn.

   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:17 JST Nathan Schneider

     in reply to

     And when you see those oddball examples that There Is Another Way, and What Do You Know, It Works—it can make you sad more than happy. Because, look, there's a perfectly good way to do this stuff, and we're not taking it. We're dissuading people from taking it. We're ruining the world by not taking it, but still we don't.

     Aral Balkan repeated this.
   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:24 JST Nathan Schneider

     in reply to

     The other problem is policy.

     Public policy is a huge part of why you don't see more mutually owned things. The tax incentives, infrastructures, the loopholes, the culture—it all creates a ratchet effect. Jack Bogle (or, say, Visa founder Dee Hock) are these outliers who take a self-sacrificial position to stick it to the industry they recognize as evil. But anyone who doesn't want to be self-sacrificial has no pathway for doing the right thing. The temptation for evil is everywhere.

     Aral Balkan repeated this.
   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:30 JST Nathan Schneider

     in reply to

     This is something you see over and over when you study co-op history: This stuff works. Really well, if there is real money behind it. But it doesn't facilitate stealing. So the rich people who get to decide what gets done in the world don't decide to do this. That's the problem.

     But there's another problem...

   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:37 JST Nathan Schneider

     in reply to

     And then, despite how incredibly successful Vanguard has been, guess what? Nobody else on Wall Street has replicated it. Why? Because you can't steal as much money that way. You just can't. Vanguard founder Jack Bogle died with $80 million in the bank. Huge, but his peers are billionaires. So nobody does it. No investors will invest in a model that doesn't allow them to swindle normies. It is sickening.

   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:45 JST Nathan Schneider

     in reply to

     What is super striking about the book is that the super capitalist Bloomberg reporter author has to admit (quoting Bogle) that the secret to what made Vanguard enormous and wildly transformative is one thing: shared ownership. Not the index fund, not the stock-picking. The shared ownership. The fact that ownership is aligned with (customer) participation. There is no getting away from that.

   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:51 JST Nathan Schneider

     in reply to

     And then a first caveat: I don't like stock. Stock derives from the ownership of animals, and the ownership of humans. It is a system that privileges investment over actual participation (particularly labor), and involves all kinds of terrible incentives and externalities. This should not be what we need to have to someday retire or send kids to school. At the end of the line of any stock ownership is a cop enforcing it with a prison and a gun. But pretend for a moment that stock is okay.

   • Nathan Schneider (ntnsndr@social.coop)'s status on Tuesday, 21-Feb-2023 16:15:58 JST Nathan Schneider

     in reply to

     The hopeful part: Here is a business that has saved rank/file savers upward of a trillion dollars simply with its lower investing fees compared to Wall Street. How? Mutual ownership. It is owned by the investors. That plus simple index funds in a growing economy means, at least compared to the previous baseline, good news for the top 50% of Americans who are able to own even a little stock. (Tough luck for the rest?)