🔺

Day 16 — Artificial Scarcity & Ponzi Schemes

A satirical piece entitled "How to Run a Ponzi Scheme for Tech People" made the rounds on tech Twitter this week. It critiqued the trend of creators and "micro-influencers" with small followings who attempt to sell the secrets of their success to others:

Create a twitter account and manage to get 100 followers through a combination of spamming famous people, dad jokes, and paid followers. Write this blog post and share it: How I got 100 followers in my first week with no hard work at all.

While there are some incredible info-courses and threads of this kind across the web, this piece describes... the vast majority. There's nothing of value being created here — you're being sold on aspirations.

Last month, I wrote a newsletter issue entitled Artificial Scarcity and Its Discontents. I argued:

Ideas are not scarce. Information is not scarce. For all practical purposes, data is not scarce. And this is where capitalist models begin to break down... The scarcity of information is artificial. It is created purely as a means of extracting monetary value.

The examples in the satirical piece — selling advice that you cannot confirm to be true — is simply taking this idea one step further. It's a breakdown of the capitalist system. Nothing of value is being transferred, yet creators will capitalize, either through social or financial capital.

Value transfer must be preceded by value creation. Regardless of your economic philosophy, that principle must hold true.