Sunday, January 25, 2026

The Fatal Limits of the Technocrat Class

Goliath dies not because collapse occurs, but because scale mistakes itself for life. What survives was never his.

This guest essay by longtime correspondent 0bserver speaks to a dynamic woven into all of my work: the intrinsic impossibility of fixing what technocratic management broke with more technocratic management. Attempts to do so result in doing more of what's failed, with fatal consequences for the systems being "fixed," as the technocratic elite holds the power to impose policies but is immune to the consequences of the failure of those policies. Those fall on the system, which then veers into incoherence and Model Collapse.

I've been reading Luke Kemp's Goliath's Curse: The History and Future of Societal Collapse with care, because the book is serious, well-researched, and written from within institutions that spend their days thinking about systemic fragility. Kemp is not unserious, nor is he shallow. His diagnosis of elite failure, complexity, inequality, and institutional overreach aligns with much of what many of us have been warning about for years.

Where I think the book ultimately fails, however, is not in what it sees--but in what it cannot see from the altitude at which it operates.

Kemp's collapse framework is managerial. Collapse is treated as a system-level pathology to be prevented through coordination, governance, and institutional reform. This makes sense given his professional formation and affiliations, but it creates a blind spot that becomes more consequential the longer one reads: continuity is assumed, not explained.

The book speaks fluently about sustainability, inequality, elite capture, and long-term risk. Yet it does not seriously engage with inheritance--not inheritance as wealth alone, but inheritance as transmission: skills, trades, family structure, norms, fertility, competence, and responsibility carried forward across generations. Sustainability is framed as system stability rather than generational renewal.

This omission matters, because collapse is not the absence of order. It is the failure of particular scales of organization. When large institutions fail, life does not disappear--it reorganizes. The question is not whether systems can be stabilized indefinitely, but whether anything capable of inheritance remains when stabilization fails.

Luke Kemp is excellent at identifying fragility in centralized systems. He is far less interested in, or perhaps less equipped to examine, the base-rate reality that most societies muddle through breakdowns via informal order, households, and local competence. This is where pessimism overweights evidence. Failure is dramatic and legible; endurance is quiet and distributed.

Where this becomes decisive is in Kemp's proposed solutions.

When collapse looms, the remedies offered are more coordination, better governance, stronger institutions, improved global frameworks, and smarter management of risk. Complexity is to be handled by expertise; inequality by policy; instability by coordination. The scale that failed is asked to save itself.

This is the core problem.

The solutions operate at the same level as the failure.

Centralization is offered as the cure for overextension.

Governance is offered as the cure for institutional fragility.

Coordination is offered as the cure for complexity.

The very mechanisms meant to prevent collapse amplify its consequences when they fail.

Recent history supplies proof--not theory.

The financial collapse of 2008 rescued banks while households absorbed the loss. Large institutions were recapitalized immediately; families lost homes, savings, and years of accumulated effort. Recovery was declared long before household continuity returned.

The pandemic reinforced the same pattern. Large corporations were deemed essential, while small and local businesses were declared nonessential and shuttered. Compliance favored scale; capital consolidated upward; independent capacity quietly disappeared.

A third proof is now unfolding without crisis declarations. Large banks continue to grow while private equity consolidates trades and local services--plumbing, HVAC, electrical, veterinary clinics, small manufacturing. Businesses are bought, debt-loaded, stripped, and optimized for extraction. Ownership disappears, stewardship evaporates, and nothing is left to inherit when failure arrives.

These outcomes are not policy accidents.

They are the predictable result of scale-first solutions.

Systems are stabilized.

Households are tested.

Continuity bears the cost.

What troubles me most is that Goliath's Curse critiques elites and inequality while failing to recognize how insulated analysis itself has become. Collapse expertise that cannot be lived becomes abstract. Risk is modeled without skin in the game. Moral urgency is asserted without moral grounding. The book makes moral claims--about obligation, responsibility, and injustice--without ever naming the source of those obligations.

This creates a quiet contradiction. Moral language is necessary to motivate coordination, but moral foundations are left ambiguous to preserve managerial flexibility. In the absence of grounding, obligation eventually collapses into power.

Nassim Nicholas Taleb has a name for one failure mode here: the intellectual yet idiot--not stupid, not malicious, but insulated from consequence. I don't think Luke Kemp himself is the target. The framework is. Collapse theory that remains legible only to institutions will always propose institutional solutions, even when the problem has already migrated below that level.

The real threat is not collapse per se. Systems rise and fall. The real threat is the dissolution of the family and the erosion of inheritance.

Institutions can be recapitalized. Markets can reprice. States can fragment and re-form. Families cannot be substituted.

When families fail to reproduce competence, culture, and responsibility across generations, nothing downstream inherits. What follows is not collapse but vacancy.

Goliath dies not because collapse occurs, but because scale mistakes itself for life. What survives was never his.

That is the argument I think Goliath's Curse gestures toward but cannot complete from where it stands. The book diagnoses fragility well. It does not yet explain endurance.

And in the end, endurance--not prevention--is what decides the future.


This is a guest essay by longtime correspondent 0bserver.


CHS here: note that the global technocrat elite follows a power law distribution in where they attended university:



...and the power they wield in markets and institutions:




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Friday, January 23, 2026

The Epic Struggle Just Ahead

Since the forces seeking to decentralize capital and power are distributed among numerous competing interest groups, the forces of centralization have the upper hand.

Today I conclude this week's exploration of narrative control as the core mechanism of social, political and economic control. In Narrative Control Made Easy: Us versus Them, I explained the core dynamic of creating binaries (us or them, all or nothing, "capitalism" or "communism," etc.) that force a false choice, an illusion of choice that directs the populace to grant control to whomever benefits from the false choice.

These mechanisms enable not just classic "divide and conquer"--prying apart populations into warring camps that see each other as the "enemy," enabling easy control of the entire distracted, misdirected populace--but the setting of contexts, agendas and priorities--establishing the limits of what's viewed as possible and positive in ways that benefit those holding centralized power.

So if "Progress" is defined as "what generates the highest profits for us," then the populace comes to believe that extractive monopolies actively degrading our quality of life while raising costs are not just all that is possible but this exploitive arrangement is also the best of all possible worlds, because Progress is inherently positive.

The sheep are delighted to be sheared because this is "progress."

In Lessons from China's Cultural Revolution, I discussed how targeting a scapegoat segment of the population diverts the pent-up frustrations of expectations dashed away from those controlling the centralized system to an ill-defined set of class enemies, heretics, etc.--the label assigned to the scapegoats depends on the flavor of centralized power: theocracies will choose different labels than democracies-in-name, for example.

Which brings us to the struggle just ahead between the forces centralizing capital and power and those seeking to decentralize capital and power. In the broad sweep of history, we can discern these forces at work as those benefiting from centralizing power use narrative control to justify their consolidation of capital and power and those seeking to escape the tyranny of centralized control offer a competing narrative conducive to localized, more broadly distributed control.

These forces are visible in all forms of governance and power structures, from those based on religious faiths to monarchies to republics.

In the current era, the dominant narrative is Neoliberal Cornucopianism: if we just let the markets, wisely guided by an elite technocrat class, control not just the economy, but society, governance and the narrative, then we'll all enjoy super-abundance as the natural order of things.

In this self-serving narrative, centralizing capital and market power is a good thing because scaling up via centralization lowers costs and makes us all prosperous. This is of a course misdirection, i.e. a lie. When financial-market powers are centralized, the result is monopoly and cartels that then use their market power to degrade quality and quantity, raise prices and only allow products and services that maximize their private gains onto the market.

So we can no longer own software outright, it must be rented via subscription. There are no simplified, mostly analog, easily repairable, small, durable, affordable vehicles on the market because these are inherently unprofitable compared to complex, large, unrepairable, high-cost vehicles.

Since the forces seeking to decentralize capital and power are distributed among numerous competing interest groups, the forces of centralization have the upper hand until the second-order effects of their self-serving control brings the system to its knees. The struggle just ahead is the primary conflict between the forces seeking to further extend over-extended centralization and those seeking to distribute capital and power beyond the tiny self-selected elite that defines "progress" and "prosperity" as whatever increases their concentration of capital and power at the expense of non-elites.

The books of my Revolution Trilogy describe this struggle in greater depth.

Monopolists are gleefully anticipating the further immiseration of the labor force as the means to increase their share of the economy's capital and gains:



From the perspective of those holding centralized, concentrated power, this power-law distribution is not only ideal, it's the natural order of things:



As for the bottom 90%: when they can no longer afford bread, let them eat brioche.



Wealth inequality in America just hit its widest gap in 3 decades: The wealthiest 1% held about $55 trillion in assets in the third quarter of 2025--roughly equal to the wealth held by the bottom 90% of Americans combined.


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Wednesday, January 21, 2026

Lessons from China's Cultural Revolution

Just as nobody foresaw the Cultural Revolution, few if any foresee the emergence of the American equivalent.

China's Cultural Revolution (1966-1976) is interesting on multiple levels. The conventional narrative holds that it was the result of a power struggle between Mao and competing elements in the Chinese Communist Party (CCP), as Mao launched a chaotic cleansing of the Party's leadership that soon devolved into widespread disorder that consumed much and yielded little of lasting value.

My understanding of the Cultural Revolution comes not just from academic studies but from first-hand accounts from friends who lived through it. There are two stipulations in this account:

1. The Cultural Revolution remains politically sensitive, as it was clearly a catastrophe for China that reflects poorly on various sacrosanct figures and institutions. Discussions of what happened are not welcomed, and so even when those who lived through it are in the safety of their own home in the US, they tend to speak in hushed tones, for the topic is verboten.

2. As a general rule, Asian cultures do not relish badmouthing their nation or culture. Westerners will not be offered honest accounts unless they are longtime friends who have demonstrated their trustworthiness over many years. So "friends" who are actually only acquaintances are not going to speak openly.

The travails of senior officials are well-known. A recent book documents the experiences of Xi Jinping's father, a high-ranking CCP official who--along with his son--suffered greatly in the Cultural revolution: The Party's Interests Come First: The Life of Xi Zhongxun, Father of Xi Jinping details the difficulties faced by loyalists in surviving Mao's mercurial purges and precipitous humiliations of senior officials.

It doesn't take much armchair psychoanalyzing to discern the enormous impact the Cultural Revolution had on Xi Jinping's worldview, mindset, goals and priorities.

Equally obvious is how events quickly spiraled out of control, reaching extremes far beyond what was initially anticipated. The public's passive compliance to authority and narrative control was taken to be permanent. Passive compliance appears permanent but it is always contingent.

Firsthand accounts of regular people have typically received a lower profile. One friend's father was an officer in the People's Liberation Army (PLA) which we might have presumed was immune to the chaos. But PLA officers were demoted, put under house arrest and humiliated, while many of those associated with someone deemed an enemy of the people were sent down to the countryside even if they were innocent of wrongdoing.

Another friend's father was put under house arrest for years for the "crime" of having traveled to Soviet Bloc countries as an acrobat in a performing troupe.

In other words, the Cultural Revolution opened the door to denouncing, humiliating, torturing and even killing not actual "class enemies," but loyal Party members who were "guilty" of nothing more than performing their assigned duties. The Cultural Revolution gave permission to pursue personal vendettas and exact retribution on an unimaginably vast scale.

A friend born in 1967 at the height of the initial tumult was named "Love Mao" as a means of fitting in and inoculating the family from the sort of baseless denunciations that were not just permitted but encouraged as "revolutionary activity."

What few if any commentators mention is the unrecognized pent-up frustrations with a system that was launched with such promise and delivered less than what was promised. "Let a hundred flowers blossom, let a hundred schools of thought contend" turned into The Great Leap Forward, a disastrous policy that led to famine.

The unstated context of the Cultural Revolution was poverty. Another friend described how scarce and precious eggs were: her parents carefully divided the occasional egg into four pieces, one for each family member.

People did not have to be coerced to join the Red Guard's rampages; they relished the opportunity to be free of any cultural or political constraints. It's tempting to dismiss this as just another example of the madness of crowds, but this ignores the underlying dynamic of expectations not being met and the consequences of repression and never-ending power struggles and purges.

The first lesson of the Cultural Revolution is that if redress is unavailable, then retribution will become the default pathway. I discuss these dynamics in my new book Investing In Revolution in the context of their inevitability in the current era.

The second lesson of the Cultural Revolution is that allowing--much less encouraging--the unleashing of frustrations with the system on ill-defined "enemies of the people" who are innocent quickly spirals out of control. In the Cultural Revolution, the targets quickly expanded from those in authority positions in the Party to anyone deemed suspicious for any number of reasons: being educated, having traveled to other countries, being the offspring of the landlord class, being the offspring of a purged official (like Xi Jinping being abused because his father had fallen from grace), or simply being an object of envy.

This expanding circle soon included cultural relics of the past, and so irreplaceable Buddhist temples and other priceless artifacts were destroyed out of "revolutionary fervor."

The third lesson of the Cultural Revolution is that once these forces are released, it is impossible to put them back in the bottle. Those in power reckon that unleashing a flood tide of resentments and frustrations with the system on a selected group of scapegoats relieves the potential risk of the public revolting against the regime.

But this ignores the potential for the injustice and chaos to destabilize the regime, for the injustice and destruction don't just affect the scapegoats; they undermine the social, economic and political orders, too.



Just as nobody foresaw the Cultural Revolution, few if any foresee the emergence of the American equivalent. The consequences of expectations not being met build up despite repression and narrative control, and when the containment finally bursts, the dynamics are nonlinear--chaotic, unpredictable, uncontrollable.

Everything is forever until something unexpected breaks.


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Monday, January 19, 2026

Narrative Control Made Easy: Us versus Them

Those in charge of narrative control are suffering from the delusion that they're making sense. Everything is under control until it isn't.

The name of the game in controlling the populace is narrative control, the current term for setting the context, priorities and agenda so the populace complies without being aware they've been bamboozled into accepting a system that benefits the few at the expense of the many.

The easiest way to control the narrative is to establish the false choice of an either-or binary: Us versus Them. This is easy because it bypasses our rational mind by tapping our hard-wired instinct to divide humanity into members of our group and Outsiders / Strangers who are potential threats until proven otherwise.

As a general rule, our values, opinions and fealties stretch along a spectrum. We may have loyalties to values that are typically categorized as "conservative" or "liberal" and find no conflict between them.

To control the narrative, all nuance and variability must be crushed into an all-or-nothing litmus test: if you disagree with even one of the narrowly defined litmus test standards for inclusion in the "conservative" or "liberal" group--as defined by those seeking to control the populace by controlling the narrative--then you are cast out as "an X in name only."

The "other group" is vilified as servants of the Devil. Reading the diatribes mailed out to "loyalists" of the two political parties (seeking donations, of course--proving your loyalty is always about money) is a master class in parody that isn't recognized as parody: "they" are seeking to pollute our precious bodily fluids under the malefic cover of deceptively attractive PR.

That all Us and Them binaries are false choices must never be exposed lest the rational mind awaken to the manipulation of a completely fabricated either-or narrative. This fabrication is the foundation of wartime propaganda, of course, as there are no limits on what must be done to rid the Earth of the enemy of all that is good and just.

This works just as well in politics and culture wars: rally the troops by enforcing litmus-test inclusion standards that serve the purposes of those in charge of the narrative factory while providing an identity and the benefits of membership to those who declare their fealty to the litmus test checklist.

Skeptics are targeted as backward heretics. If you question the current definition of "Progress"--Progress is whatever makes me more money--then you're instantly tarred as a hopeless Luddite.

Once the consequences extend to money, income and security, fear kicks in. Standing up for sacred values is a good thing until it might cost us our jobs: when things get serious, we have to lie.

This enforcement of false-choice narratives pushes us into Ultra-Processed Life: everything is self-serving artifice, but pointing this out brings trouble, so we go along with the charade. There's no meaning in the narrative other than enforcing compliance to what's on the agenda of options, which are all false-choice binaries: would you choose to be a Good Person or a Bad Person? Hmm, that's not much of a choice, is it?

The irony here is that those controlling the narratives see our compliance as "winning," unaware that their control mechanisms have hollowed out the culture, politics and the economy, reducing everything to either-or binaries that are intrinsically false.



Falsities generate false signals, which lead to Model Collapse. Those in charge of narrative control are suffering from the delusion that they're making sense. Everything is under control until it isn't.




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Monday, January 12, 2026

Why Is Everything Such a Hot Mess?

Nobody believes that "doing more of what's failed" will actually fail, because to date it's only made insiders rich.

Why Is Everything Such a Hot Mess? Let's summarize the consensus views.

1. Sociopaths are in charge. There are two options: A) the sociopaths gained power through official, legitimate means such as elections or royal bloodlines, or B) the real web of power is hidden from public view and operates behind the screen of official authority.

2. Alternatively, the system itself is sociopathic and so it doesn't matter who's in power, as the system elevates sociopaths to power by its very nature.

Yes, there are sociopaths and yes, there are conspiracies. Every corporate price-fixing scheme is a conspiracy that is consciously organized to benefit the few at the expense of the many and protect the conspirators from any negative consequences.

These are the defining traits of every conspiracy: pull hidden strings of power for private gain (more power, more wealth, etc.) and moat the conspirators from any consequences.

In this view, if we replaced the sociopaths who gained power and exposed the conspirators / hidden web of power to consequences, then we could restore legitimacy, stability and functionality to the system.

The alternate view is: since the system itself is sociopathic, the only way to restore legitimacy, stability and functionality is to change the system from the ground up: change the structure of power, oversight, incentives, the whole ball of wax.

In a conspiracy, those organizing the hidden web of power know it's wrong which is why they must hide it: exposure means ruin because the system still has the capacity to punish fraud, exploitation, abuse of power, etc. When the system itself is illegitimate and dysfunctional, then those rising up the ladder to positions of power don't see it as wrong; it's simply BAU--Business As Usual, the way things work and have always worked.

In this view, perverse incentives have been normalized and are accepted as status quo. So for example, addicting your customers to destructive products and services is an excellent business plan as it maximizes profits while directing the consequences onto the customers, not the corporate leaders who planned and executed the profit-maximizing strategy.

Since fraud and exploitation generate higher profits, any CEO that reverses this strategy will be fired for gross incompetence, as the means to increase profits don't matter, only increasing profits matters.

Maximizing fraud and exploitation maximizes personal enrichment. But in a sociopathic system, this isn't viewed as wrong, it's BAU--Business As Usual, as the system's explicit goal is the maximization of private gains by any means available.

In my book Investing In Revolution, I trace how success and abundance generate sociopathic systems. The process isn't guided by sociopaths, it's human nature amplified by centralized, institutionalized power.

The psychology of what appears to participants as permanent abundance goes like this:

In the initial boost phase of the organization, success is not guaranteed. Success is contingent on the organization fulfilling its real-world purpose: transparent, competent governance, making products of enduring value and functionality, etc.

This requires feedback from the real world that hasn't been filtered, as filtered feedback generates false signals, and responding to false signals leads to failure.

The leadership of the organization understands this and accepts accountability, for the organization won't survive contact with the real world if leaders are not accountable for failures.

Feedback and accountability are transparent out of necessity.

This changes once the organization has institutionalized its success. The perception of those inside the organization changes: the organization is now viewed as so stable and successful that its existence is no longer contingent; it's guaranteed.

Insiders no longer have to concern themselves with feedback and accountability; the focus shifts to maximizing private gains. Since the organization is permanent and rich in resources, revenues and political protection/power, there's no need to invest in maintaining feedback or accountability, as the system basically runs itself via rules that govern the centralized hierarchy.

The organization selects those amenable to hierarchy and obeying rules. Those applying for positions self-select: those who chafe at hierarchy and rules quit.

Over time, this leads to leadership optimized for following rules and protecting the organization from consequences. Those with the capacity to adapt to sudden changes by reworking the entire organization on the fly have been weeded out by either self-selection or the optimization of business as usual, i.e. the artifices of filtering feedback, limiting accountability and defending the organization from negative consequences.

So when the time inevitably comes where radical re-organization is the sole path to survival, there's no organizational memory to tap and nobody in the organization with the ability to manage it. The leadership will simply increase the resources devoted to artifice--bogus statistics, happy-story narratives, fake reforms, and so on.

To serve these now-embedded goals of filtering feedback, limiting accountability and defending the organization from negative consequences, insiders modify the organization's rules of the game incrementally, eroding the authenticity of feedback and loosening accountability, as these modifications increase private gain and reduce exposure to consequences.

Once exposure to consequences has been eliminated, accountability is lost and the system loses the capacity to self-correct: feedback is edited/curated to maintain the appearance that the organization is fulfilling of its purpose admirably and the leadership is fully accountable, i.e. the leaders will experience negative consequences for the organization failing to fulfill its purpose.

This dismantling of feedback, accountability and consequence isn't a conspiracy or a takeover by sociopaths; it's all being done by perfectly average people who take their kids to soccer practice, etc., just like everyone else.

They don't see the erosion because it started long before they grasped the first rung in the ladder to authority. They're blind to the erosion of real feedback and accountability, and so they're blind to this erosion leading to the organization's failure to fulfill its purpose.

Since the organization rewards optimizing the tools of artifice--filtering feedback and moating the leadership from consequence--that's how to they use their power: increase the artifice because restoring authentic feedback and accountability threatens not just their personal self-enrichment but the legitimacy and stability of the entire organization.

So they vigorously pursue doing more of what's failed until the consequences of the corrupted feedback and loss of accountability lead to Model Collapse: the entire model that generates the rules that guide the organization collapses in a heap.

That's how everything became such a hot mess. Nobody believes that doing more of what's failed will actually fail, because to date it's only made insiders rich.

Ultimately, this leads to a stark choice nobody accepts as inevitable: invest in Business As Usual or Invest In Revolution. Doing more of what's failed doesn't generate success, it simply accelerates the collision with consequences. But nobody inside the organization believes this, as doing more of what's failed has been wildly successful for their entire career.



It didn't have to be this way. Of course it did. The causal chain leaves no other option.


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