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  "description": "New to Misaligned Markets? Here's an overview of the ideas behind the project.",
  "path": "/start-here/",
  "publishedAt": "2025-10-16T19:00:22.000Z",
  "site": "https://misaligned.markets",
  "tags": [
    "Subscribe",
    "email me",
    "roundup of my most popular blog posts",
    "The four paradoxes of capitalism",
    "Capitalism as a stack (still in progress)",
    "The tension at the heart of market capitalism",
    "The historical contingencies of Anglo-capitalism",
    "operationalize Moore’s Law into a competitive advantage",
    "ate market share from US car companies",
    "tetraethyl lead as a gasoline additive",
    "poisoning",
    "your car spies on you",
    "Collateralized debt obligations",
    "Externality",
    "Information asymmetry",
    "Capitalist serialization",
    "Corporate kung fu",
    "Differentials / Gradients (still in progress)",
    "The lethal economics of corporate kung fu",
    "Capitalism runs like a computer (and it's being hacked)",
    "path of least resistance",
    "brute-force optimizer",
    "weak-link system",
    "brute-force optimization",
    "the tyranny of now",
    "What do AI alignment fears reveal about market capitalism?",
    "Philip Mirowski",
    "Runaway optimization (“Mammon”)",
    "Beyond greed: Mammon as an analogy for maloptimization and wicked problems",
    "When optimization goes wrong: Caught in Mammon’s Grasp",
    "anti-rival",
    "Great Technological Railway",
    "Competition is for losers"
  ],
  "textContent": "_Misaligned Markets_ is an exercise in thinking publicly about the social and economic structures of our world. I do my best thinking in dialogue with others, so I invite subscribers to join me as collaborators and interlocutors. My goal is to create mental models that encapsulate how market capitalism functions, to inform how we talk about economics and public policy. Subscribe, comment, or email me. I’d love to hear from you!\n\n## What exactly is this all about?\n\nMisaligned Markets is effectively two projects in one:\n\n  * A blog about how markets under capitalism construct and select for representations of reality that favor specific actors. It didn’t start out that way, but that’s what it’s become. This aspect involves me developing my own unique way of describing market capitalism informed by my background in cybersecurity, systems theory, and political economy.\n  * A public resource where I use my knowledge to educate the public about philosophy, politics, and economics beyond my personal framework.\n\n\n\nTake a look at this roundup of my most popular blog posts to get a flavor for what I write about.\n\n## Great, another person talking about capitalism\n\nYeah, I know. But I promise I’m at least a little original. Don’t believe me? Read and give feedback on the core ideas I _’_ m bringing to the public sphere.\n\n#### Why do you say “market capitalism?”\n\nI take a diagnostic approach to political economy, where I look at components within a system to better understand the function of the whole.\n\nWhat we call capitalism is better seen as a metastable system consisting of:\n\n  * Capitalism: structures that codify and enforce ownership.\n  * Markets: a resource distribution mechanism.\n\n\n\nThese are the fault lines of the system, and friction between them shapes capitalism’s evolution.\n\n****What do you mean?**** The antebellum United States, post-Meiji Restoration Japan, the New Deal United States, and modern-day Nordic countries are examples of capitalist societies with markets. Market capitalism is best seen as a continuum where aspects like property rights enforcement, market concentration level, and regulatory regime structure shape an economy.\n\n****Key ideas****\n\nThe four paradoxes of capitalism\n\nCapitalism as a stack (still in progress)\n\n****Read:**** The tension at the heart of market capitalism\n\n****Then**** : The historical contingencies of Anglo-capitalism\n\n#### Okay, what does “market” capitalism do in your view?\n\nMarket capitalism optimizes for:\n\n1. The accumulation of capital\n\nCapital growth becomes both the measure and goal of success, regardless of whether real value is created.\n\nAt the firm level:\n\n  * The Dutch East India Company reinvested profits from each voyage to finance the next.\n  * Amazon operated at a loss for many years, recycling its earnings into infrastructure and market share.\n\n\n\nAt the macro level:\n\n  * The dot-com bubble showed how exuberance can inflate valuations detached from productive capital. Some of that excess, in the form of fiber cable investment, would later fuel the growth of Web 2.0 companies.\n\n\n\n2. The exploitation of structural asymmetries within capitalism, markets, and the world\n\nActors who leverage knowledge of relative advantages are rewarded with pricing power and profit. Sometimes this asymmetry drives actual progress; sometimes it hides harms.\n\nMarket capitalism at its best:\n\n  * Intel was among the first semiconductor firms to operationalize Moore’s Law into a competitive advantage\n  * Starting in the 1970s, Japanese automakers ate market share from US car companies through higher quality and fuel efficiency.\n\n\n\nand at its worst:\n\n  * General Motors promoted tetraethyl lead as a gasoline additive that boosted performance while knowingly poisoning tens of millions over a century. Internal notes show GM and its partners rejected safer alternatives like ethanol because these couldn’t be monopolized.\n\n\n\nExploiting the structure of capitalism enables:\n\nThe offensive expansion of property rights through enclosure and commodification. This expands what private actors can own and profit from, while restricting competition and access.\n\n****examples****\n\n  * British Enclosure Acts converted shared lands into private estates, forcing subsistence farmers into wage labor.\n  * Digital Rights Management (DRM) transforms ownership into licensed access\n  *     * This is why your car spies on you, sells your data, and raises your premiums.\n  * Patent trolling monetizes innovation indirectly, turning legal rights into rent streams.\n\n\n\nThe defensive use of property rights to externalize risk, debt, and liability.\n\nLegal and financial instruments shift costs off balance sheets, allowing strategies with high social or environmental fallout to appear efficient.\n\n****examples****\n\n  * Collateralized debt obligations (CDOs) in the 2000s sliced and sold mortgage risk until it “vanished” from view\n  * Special Purpose Vehicles (SPVs) isolate losses in expendable subsidiaries, letting parents claim stability while debts sink elsewhere.\n  * Forced arbitration uses contract law to privatize accountability, isolating legal risk from public scrutiny.\n  * Patent mining and other rent-seeking tactics turn ownership into litigation leverage rather than productive activity.\n\n\n\n****Key ideas****\n\nExternality\n\nInformation asymmetry\n\nCapitalist serialization\n\nCorporate kung fu\n\nDifferentials / Gradients (still in progress)\n\n****Read:**** The lethal economics of corporate kung fu\n\n****Then**** : Capitalism runs like a computer (and it's being hacked)\n\n#### Why does market capitalism function this way?\n\nELI5:\n“Society” is a large organization that commissions explorers to venture into the wilderness and bring back resources that might improve life within its walls. It’s fine if several explorers find the same thing; the organization is happy to pay for duplicates if they’re useful.\n\nBut the organization can’t easily tell who’s bringing back good things. Some explorers return with soothing remedies, well-crafted tools, and healthy sources of food. Others bring bright powders and pass off useless trinkets or poisonous plants with clever tricks. The problem is that the organization judges discoveries by how exciting they sound when presented, not by what they actually do once used.\n\nEven if only a handful of explorers bring back harmful resources, this can make many lives worse off. Yet the search continues. The organization keeps sending out expeditions because searching is the only way it knows to produce what it needs.\n\nMy hypothesis:\n\nMarket capitalism is a system embedded within society, culture, law, ecology, and the wider world. Within this environment, it seeks to discover and amplify exploitable advantages through the profit motive—diffusing knowledge, but not necessarily wisdom. Over time, the path of least resistance will lead market capitalism to cannibalize itself as an ever-expanding amount of low-cost, high-externality opportunities for profit become abundant.\n\nMarket capitalism is a brute-force optimizer. If it had a “personality,” it’d be:\n\n  * “blind” it can’t tell good advantages from bad ones. It will even select for ideas that undermine itself so long as they generate profit (e.g., abuse of property rights).\n  * “dumb” it can’t remember what it has already done. It forgets incomplete solutions, rediscovers old mistakes, and reproduces familiar harms under new names.\n  * “greedy” it favors results with immediate returns, regardless of their long-term costs.\n  * “wasteful” it floods the zone with redundant and sometimes costly solutions; some good and some bad. The process never stops and will keep going until something breaks.\n\n\n\nThis makes it a weak-link system. Even if most activity is “honest,” optimization produces a distribution of outcomes. At the tail end of that distribution, harmful outliers can have substantial impact and might even undermine the system. Sadly, likely doubles as a solution to the Fermi paradox.\n\n****Key ideas****\n\nbrute-force optimization\n\nthe tyranny of now\n\nweak-link system\n\n****Read**** : What do AI alignment fears reveal about market capitalism?\n\n#### Metastable? Optimizer? Why do you talk like that?\n\nThere are Bay Area rationalists in my life that I’ve gotten into intellectual fights with. I’m definitely not a rationalist, and find their community problematic, but I realized the cybernetics, control theory, and optimization dynamics they use to describe AI perfectly capture capitalism. In other words _****market capitalism****_ is the alignment problem they should genuinely be concerned with.\n\nIronically this brought me in tradition with some economists who use systems theory, evolutionary optimization, and cybernetics to talk about capitalism. See Philip Mirowski, as an example.\n\n****Key ideas****\nRunaway optimization (“Mammon”)\n\n****Read**** : Beyond greed: Mammon as an analogy for maloptimization and wicked problems\n\n****Then**** : When optimization goes wrong: Caught in Mammon’s Grasp\n\n#### How does useful information diffuse in market capitalism? [in progress]\n\nHumans naturally cooperate by sharing and imitating good ideas. Many of our best innovations are anti-rival__;__ they only become more valuable the more people use them (like language or open knowledge). Market capitalism can mirror this dynamic when the profit motive aligns with public goods or government-funded research. But as public investment recedes and firms grow more extractive, this coordination falters and the train of innovation gets captured at a privately-owned station.\n\n****Key ideas****\n\n  * Great Technological Railway\n  * (contrast with) “Competition is for losers”\n\n",
  "title": "Start Here",
  "updatedAt": "2026-05-12T11:13:21.467Z"
}