How the Web rendered Europe uncompetitive

If you wanted to really harm Europe, you’d want to have invented the Web.

The problem with anaemic growth in Europe and UK is cultural; we have aristocratic tendencies. Our class system is the main reason that America revolted in 1775.

Times have changed but the aristocracy lives on as a narcissocracy. This is a society in which those who simply feel they are better than others, or are raised to feel special, often when narcissistic parents pay for private schooling, decide that they must be in charge at all costs, not least to justify their schooling. This class of people impose themselves in the way of smarter, more skilled and more capable people.

Such organisations and societies are at a severe disadvantage compared to meritocratic systems in the digital age. The narcissists are continually under threat, and so they stymy challengers with bureaucracy, law and private networks.

You see the narcissocracy at its most stark when white, non-technical founders hire talent from the colonies to build the thing that makes them rich. In many European companies, technical people occupy the lower floors of a tower, or are in less salubrious building altogether. The class system is manifest in skyscrapers with city views.

The stunning divergence we see in charts comparing the U.S. with Europe is because the web democratised information, and withholding information was how aristocratic systems held power.

The Americans are amazed at how cheap it is to hire a software engineer in Europe. The reason engineers earn much less here is because we are unable to turn their outputs into value. The deep corporate structure of Victorian era businesses is the entirely wrong configuration for this kind of skilled, creative, collaborative and iterative product work.

The Web, invented by a Brit in Europe, is anathema to our culture while favouring the more meritocratic culture in northern California, and the U.S. in general.

In the meantime, political narcissists have poisoned the soil with regulation and bureaucracy.

AI will further widen the gap between Europe and America. AI is a lever that’ll work more for the smart and curious, working together, unencumbered by an historic corporate morass, while suffering less regulation, and access to a large and integrated market.

But we can do something about this: technical people should try to avoid working for a non-technical CEO or founding team.

I believe that the narcissists, who impose themselves in the way of people who build things, can be starved out of the system, if enough smart people realise the power they have, and if Europe will allow the old companies to die.

If you think this is implausible, then consider that America’s most successful startup incubator, YC Combinator, will invest 500,000 USD in an idea on the back of a napkin, but will not invest in anyone who cannot actually build their idea.

Death & taxes: the problem with regulatory capture is that it holds up uncompetitive companies to such a degree that they would die without it, risking jobs, decline and even unrest. Preventing such a dire situation is a case of, you guessed it, more regulation. The EU has regulated itself into a corner.

However, we can’t all emigrate to the U.S., so the next best thing is to emigrate to a new employer–after all, Silicon Valley is largely birds of a feather flocking together.

Flocking is another downstream effect of the Web, it allowed people to find each other and collaborate, see how they live in San Francisco and even book a flight. This all fed the flywheel that began when Arthur Rock raised money for the “Traitorous Eight”, a group of highly-technical “defectors” who left Shockley Semiconductor in 1957.

A group of young nerds would surely never have been regarded as investable in Europe in 1997, let alone 1957.