As somebody working in software startups in Europe, what I’ve seen is a pretty broken system. The companies have a wild west attitude towards sales that leads to irregular contracts unpredictable money flow.
I’ve worked on trying to predict our income based on our contracts and because of a couple of sales people a lot of the contracts where basically inscrutable, we brought two different experts in to “fix” my “failing” just for them to give up and do what I did and predict future income based on billing rather that contracts. That made us less interesting to the more risk shy European investors. It didn’t help that we abused a system that was designed to run an IT shop with because that is what the company started at years earlier.
The other thing is that until you make about 25 million revenue a year nobody is interested in you. To risky, not enough early investment and companies are money strapped. At that point a lot of the companies that come in don’t come in to invest but to buy up the company and those companies are usually American. If you do get investors and those investors are Europeans they are often Vulture investors that prop the company up, make it more presentable and just sell it on to the next investor. In one lucky case the IT startup was bought up by a European company that wasn’t in IT and saw the investment as a way to future proof itself.
The investment for startups and in particular IT startups in Europe is very broken and the companies that benefit from it are often American. It is getting better but I think the US can still snap up European companies for its own growth for the next 10 to 20 years.
I think that "U.S. Technology Rules" is not correct.
Taiwan's microchip technology is better than the US's.
Several countries have hypersonic missile technology that's better.
China's space technology is better at present than the US's. (The current US space technology level is a far cry from the Apollo era of the 1960s-1970s.)
And the main reason for Europe's decline is the loss of cheap energy from Russia after 2022. If you can't compete price-wise, you go out of business. When your manufacturing companies go out of business, the country gets de-industrialised. That was a completely self-inflicted disaster. The US didn't stop importing important commodities from Russia in 2022, while Europe did. (A very dumb decision on Europe's part.)
He's talking about the size of US technology companies:
> Look at a list of the ten tech companies with the highest market valuation as of mid-November. With the exception of the Taiwanese semiconductor giant TSMC, all are American; no European company even comes close
Why would we assume that DOGE is really about tackling unnecessary spending? The principle to not ascribe to mice that can be explained by incompetence is a heuristic that is exploited by the malicious. It is easily seen as finding fig leaves for political actions to take, where the public words are "waste/savings" and the actual reason is "crony orivatization/agenda interference".
Caveat - his "technology" quickly morphs to "digital technology", then to being one of the largest hyper-profitable web & computer monopolies (plus Tesla). And "ruling" seems to be all about leading the Market Cap ratings - aka ruthlessly extracting money from other, at scale.
And - if you discounted the productive "efficiency" of natural-monopoly extractive digital businesses (easily-scaled data centers, token-at-best customer service), then I suspect his supposed US dominance of productivity figures would vanish.
The piece is not about economies, it's about tech dominance. I agree that he market cap of various companies and the actual earnings they produce are quite different and highly variable. And it's really about productivity of making money, not the useful activity that money would be made from.
But market cap does correlate with concentration of revenue. Some of those companies generate fantastic amounts of profit, and their tech is more widely used than the tech of others. If you don't search with Google or Bing, you might use DuckDuckGo. Any other choices worth mentioning? Computers and their cell-phone forms are an essential infrastructure now. Apple or Microsoft software is essential for people computers, Apple or Google software for phones. And so on. Yes the cash advantages can yield other business advantages like monopolization, and vice versa. Yet all enabled by geographical quirk.
He's not exploring in detail the long tail of related high tech. Remove the dominance of "productivity", the dominance of the tech remains.
Readit News
I’ve worked on trying to predict our income based on our contracts and because of a couple of sales people a lot of the contracts where basically inscrutable, we brought two different experts in to “fix” my “failing” just for them to give up and do what I did and predict future income based on billing rather that contracts. That made us less interesting to the more risk shy European investors. It didn’t help that we abused a system that was designed to run an IT shop with because that is what the company started at years earlier.
The other thing is that until you make about 25 million revenue a year nobody is interested in you. To risky, not enough early investment and companies are money strapped. At that point a lot of the companies that come in don’t come in to invest but to buy up the company and those companies are usually American. If you do get investors and those investors are Europeans they are often Vulture investors that prop the company up, make it more presentable and just sell it on to the next investor. In one lucky case the IT startup was bought up by a European company that wasn’t in IT and saw the investment as a way to future proof itself.
The investment for startups and in particular IT startups in Europe is very broken and the companies that benefit from it are often American. It is getting better but I think the US can still snap up European companies for its own growth for the next 10 to 20 years.
Taiwan's microchip technology is better than the US's.
Several countries have hypersonic missile technology that's better.
China's space technology is better at present than the US's. (The current US space technology level is a far cry from the Apollo era of the 1960s-1970s.)
And the main reason for Europe's decline is the loss of cheap energy from Russia after 2022. If you can't compete price-wise, you go out of business. When your manufacturing companies go out of business, the country gets de-industrialised. That was a completely self-inflicted disaster. The US didn't stop importing important commodities from Russia in 2022, while Europe did. (A very dumb decision on Europe's part.)
> Look at a list of the ten tech companies with the highest market valuation as of mid-November. With the exception of the Taiwanese semiconductor giant TSMC, all are American; no European company even comes close
https://paulkrugman.substack.com/p/the-fraudulence-of-waste-...
And - if you discounted the productive "efficiency" of natural-monopoly extractive digital businesses (easily-scaled data centers, token-at-best customer service), then I suspect his supposed US dominance of productivity figures would vanish.
But market cap does correlate with concentration of revenue. Some of those companies generate fantastic amounts of profit, and their tech is more widely used than the tech of others. If you don't search with Google or Bing, you might use DuckDuckGo. Any other choices worth mentioning? Computers and their cell-phone forms are an essential infrastructure now. Apple or Microsoft software is essential for people computers, Apple or Google software for phones. And so on. Yes the cash advantages can yield other business advantages like monopolization, and vice versa. Yet all enabled by geographical quirk.
He's not exploring in detail the long tail of related high tech. Remove the dominance of "productivity", the dominance of the tech remains.