Some of the best jobs are in remote corners of large companies, in particular something that is very needed but nobody can or want to do, and thus people will leave you alone enjoying freedom and a big company paycheck. Like dealing with the legacy system that actually keeps the lights on while MBAs are drafting strategies to build one failed system after another.
The parts I love are where I get to make my own decisions locally, with people who are directly affected (which to be fair, is the majority).
The parts I hate are those planned centrally; which thankfully right now are mainly limited to IT, budgeting / expenses, etc. You can completely tell that at the CTO level it looks like we're saving gobs of money by planning centrally; but at the local level you can see that in fact what's happening is the costs are being externalized into other areas in ways that are difficult to measure, but probably end up costing the company at least 3x.
Written in 2018 before Puppet was bought by Perforce - would be interesting to read a new update to see if any of Luke's ideas or practices managed to survive the buyout.
He would probably still agree with everything, but taken the money.
He was at the top correct, a founder, and thus in his article, he would have taken the majority of the money.
It is possible to know something is wrong, and feel guilt, but still take the money and continue to voice these ideas about change.
It is hard to change a system when you are winning it. That doesn't mean he isn't also right that a lot of people are victims of it.
""In other words, they generate profit because they pay their employees less than they’re worth. If everyone could trade their labor for exactly the amount of money it was worth, the corporations that employ them would have a much harder time making money. Instead, in modern corporations the shareholders and the executive team - again, the central planning committee we so despise - make the majority of the money, while the front line does all the work and makes very little.""
I agree with a lot in this article. We should have limits on the size and scope of big companies to eliminate global business, which in turn is just about shipping the costs of doing business to poorer countries where that cost is not as large simply because the poor are easier to exploit (e.g. kicking sustenance farmers off their land, dumping electronic waste, etc.).
Global capitalism is devastating because it is about creating a world where the end result is everyone in subservience to a highly fragile infrastucture in return for immense short-term wealth for a few (big-tech employees are in this category).
The size of business should be limited and corporations should be destroyed!
Sometimes that cost isn't exploitation but just taking advantage of lower cost of living - like hiring offshore devs. This still has negative impacts such as reducing domestic employment and even driving down domestic income. For example (which sometimes includes exploitation), it's easier to buy brand new shoes manufactured in a third world country and shipped halfway around the world than to find a shoe repair shop where a rebuild costs less than the new pair. Now that art is comparatively dead domestically.
Lower standards of living, lower cost would be like the difference between a budget hotel and a 5 star at the beach, lower standards is vacationing in Iowa instead.
You'll hear people say things like "culturally they like to live ten to a single room tin shack" but that wouldn't be the case if they had wealth. It's not a choice, they are just paid less and that is being used as a justification for continuing to do so.
I don't think thats entirely true. Lets pick India. Do you really think the only reason the grandparents stay attached to their adult children is economic?
Yes. All societies used to be like India is before they finished becoming industrialized.
Ask young people in India today if they want to live with Grandma, more and more say no compared to a generation ago. The wealthier they get the more this will continue.
you could use that logic as to why daycare is better than parenting too: "get out of my way, you pesky family! you are getting in my way of making money - i.e. servicing the industrialist society".
Now do the same amenities in a house the same size. Same water quailty in the taps. Price in schools and other public utilities or the cost to obtain them on your own where not offered or high quality.
Then why are ex-pats retiring in those places with a higher standard of living than they would have in the US? Why is there medical tourism to places like Thailand, where some of the hospitals have high percentages of US board certified physicians?
Standard of living is an input for cost of living. You can go to a lower standard area and have above average quality of life for yourself because the competition is lower (you're effectively rich there). Sure, maybe you need an RO filter on your tap (there are places in the US where you may need this too), but even if the filter cost is the same, the water cost will generally be lower as would the instalation labor, etc.
> We should have limits on the size and scope of big companies to eliminate global business, which in turn is just about shipping the costs of doing business to poorer countries where that cost is not as large simply because the poor are easier to exploit
While I agree it may be necessary to limit the size of companies, I completely disagree with the reason you give. It's not about the poor being easier to exploit. It really is about optimising global networks. If Eastern Europeans are both better programmers (even if you disagree, at least concede that programmers/workers may generally be "better" or "more efficient" or whatever in some region that's not yours) and much cheaper, and it's not relevant in which geographic location your product comes from, why would you keep your production in a less efficient and more expensive place? To not allow that would be similar to not allowing free competition between workers in general unless you consider for some reason that the international market should not be free (which is becoming more and more popular recently, but with which I strongly disagree - developed countries were 100% in favour of free market only while they were far and away the biggest beneficiaries of such system... now that others can compete at the same level all of a sudden it's not a good thing anymore).
How do you think areas where people get paid less will ever get higher salaries if you insist in making it harder for companies to provide jobs to those who live in such areas. It's true that this may eventually go both ways: i.e. the people in lower cost areas will start getting paid more while the people in the higher cost areas will start getting paid less. Do you find that is less just? If so, why? I find that it's much better to raise the salaries for people in lower paid areas because those people can finally raise to a decent level, while those in higher paid areas will just be a little bit less able to keep their luxuries while still keeping most of their comforts.
Where we agree is that if we allow this system to go on unencumbered, eventually only one place will produce everything (sounds familiar?), only one company will dominate each area of business, and so on. And that is antagonistic to capitalism, and coincidentally, to the wellbeing of workers and consumers as well.
> If Eastern Europeans are both better programmers (even if you disagree, at least concede that programmers/workers may generally be "better" or "more efficient" or whatever in some region that's not yours) and much cheaper, and it's not relevant in which geographic location your product comes from, why would you keep your production in a less efficient and more expensive place?
The reason why we disagree is because I disagree with free competition on a global scale, and in turn disagree with economic efficiency as a good thing in absolute terms: there is a limit, past which if we become too efficient, it implies too great an abuse of the commons.
I don't think we should have global competition for programmers: we should be more locally self-sufficient and face the consequences of our actions in our own backyard. If Eastern European programmers are better, well that is all well and good, but then that IMPLIES that people in your HOME country are NOT becoming programmers, and eventually this chain has to end somewhere, likely with SHIPPING something overseas, which in turn is unsustainable. At some point, this is likely to result in abuse of the common good (biosphere), much more so than if we stayed local.
Think about it economically: the only reason why you can even PAY eastern europeans is because your currency can be exchanged for theirs, which means that they probably want some physical product of yours.
> We should have limits on the size and scope of big companies
We could get really far by simply removing legal and political protections that make massive companies possible. If companies and their leadership could actually be held accountable by employees and consumers, they would be much more hesitant to continue to grow and chase profits indefinitely.
Similarly removing tax loop holes would also likely help. Massive companies get to a scale where they can play ridiculous tax games that just aren't possible on a smaller scale.
Exactly right. And we also need ways to combat the fact that large businesses have the money to hire a basketball team of top-notch lawyers that can crush much of their legal opposition. Basically, large companies get to a point where they are not competitive and use loopholes and other devious strategies to their advantage.
I'd actually argue that the fact that more expensive lawyers gives you a tangible, large advantage in the court room is an indication that our legal system is fundamentally broken.
Rather than trying to fix one symptom of that, corporate legal power, we should fix the legal system itself.
Oh sure, I actually meant that as a continuation of my earlier comment. We should remove legal and tax protections for companies, making large companies much less likely, and we should separately fix the fundamental problems of our legal system that corporations, among others, take advantage of today.
In some industries companies have to be big to make economical sense. Shipping, logistics, electronics, mining. Anything that requires an immense capital to create and maintain/operate.
Ignoring the anti-Capitalism nonsense, there is one interesting observation: the dictatorship-like nature of most large corporations. I always thought that the top management tiers of large corporations almost invariably attract psychopaths and power-hungry individuals who would be oppressive leaders if they were instead in real-world dictatorships. And the middle tiers attract the kind of people who would be the typical mid-level "do nothing" bureaucrats in such systems.
I'd say that generally speaking I have not. I've made it to a point in my career where I interact with the top management at Fortune 100 companies and I have not at all found them to be psychopathic or power-hungry. Actually generally the opposite: those traits seem to be selected against.
There are of course counter examples but I'd argue they're rare.
I'd say that you'll find the psychopaths and power-hungry individuals in the middle layer of companies with the "do nothing" bureaucrats at the bottom of the management hierarchy, often without any formal people management titles at all.
I echo your statement and to take it a step further:
In corporate politics there is only one thing that 'wins' and that is profitability. That profitability comes from the workforce so the top leaders are usually very motivated, democratic people because the best ideas win and you need people on your side.
Thinking about the public sector, there is no KPI for a 'win'. When we try to start using statistics it becomes 'political', skewered, or hand waved away as a complex marcoeconomic force.
I believe studies have shown that people will routinely make bad decisions from the point-of-view of business, even when it's clear to them that that's the case, because of their other biases which are too powerful to resist, specially things like racism or similar forms of prejudice (e.g. someone who is from the same social level and geographical region as the boss gets promoted over a demonstrably better candidate who comes from a less favored region of the same country... sexism also seems to apply in many countries, including the USA).
I have. It's near impossible to get to the top without a hunger for power, which, I agree, starts when these people are in middle management - so not as much in founder-led companies (although not uncommon there either).
Scheming, lying and political maneuvering at the expense of your peers is how you become the fake-friendly "Bob" or "Mike" calling the shots at the top. Non-founders who raise through the ranks largely depend on these traits. Feelings and empathy are selected away as they lead you to be passed over in promotions.
Well, a dictator is almost by definition an oppressive leader - if he isn't oppressive enough, another more oppressive guy will come along and replace him.
But yes, the observation you mentioned is indeed interesting. Hence the tendency of many people to think that states would also be better if run like a corporation, the desire to elect leaders that are (or pretend to be) successful managers, and that other observation that capitalism is not synonymous with democracy (and adopting capitalism does not automatically lead to democracy, as can be seen with China).
> Well, a dictator is almost by definition an oppressive leader
I think that you're making that up, dictators don't really need to be oppressive to remain in power. If that was true, most dictators would be quickly replaced early in their reign because there would be so many "more oppressive" people nearby, and that would only stop after "selection" done its job and a truly difficult to replace oppressive ruler was found. But that's never the case! When a dictator raises to power, usually chosen by the elite, they tend to remain in power for several decades.
If it doesn't happen that often that a new dictator manages to topple a current one, it's because the current dictator (a) already had a good power base/large support among the elite before he came to power and (b) because, as soon as he is in power, he's careful to keep his supporters among the elite happy and eliminate any possible contenders. Even Kim Jong Un, who had a good position by being built up as "heir" during his father's "reign", had to eliminate a few (true or imagined) competitors (https://en.wikipedia.org/wiki/Kim_Jong_Un#Purges_and_executi...).
> Yet, there’s a flaw at the heart of this claim. While the United States operates as a free market economy, the key agent within modern capitalism - the corporation - works more like an authoritarian state
This isn't particularly true, but where it is, it isn't a flaw. This is as designed.
Where it's true: what capitalism wants to avoid is putting "money" in with "power" (i.e. "violence" and "rules") that the state has. Companies don't have violence and only have rules in a limited sense. E.g. a company can't lock you in a box for failing to give it some of your money. Only the state can do that. Having corporations limits the blast radius of what malicious/incompetent employees can do. In a capitalist system, with enough bad decisions, your company might go bankrupt. In a communist one, with enough bad decisions, 50 million people might starve to death[0].
Where it's not true: companies exist through free agreements between people. You might argue that they aren't free enough, although that gets vague fast, but you can't opt out of the state. That's the problem with authoritarian states. You can move job. Or, if you argue that people can't move job, the problem is so much harder for moving state that the point still stands.
Can you substantiate your first claim, and expand on your second, please? I've tried to write without just name-calling at things I disagree with. Would appreciate the same. Happy to explain things that are unclear or I mis-wrote, but I can't do that based on no information.
>what capitalism wants to avoid is putting "money" in with "power"
I'd argue the enormous amount of private money in politics is evidence against this being the case in practice, along with the well-recognised notion that outcomes in the justice system often depend on how much you can afford to spend on legal representation. Yes there's a lot of formal separation between what is public and what is private, but the realpolitik is that (for example) the water company pouring untreated sewage into the rivers has much more power than the people affected by that practice.
> but the realpolitik is that (for example) the water company pouring untreated sewage into the rivers has much more power than the people affected by that practice
This is true, but it's purely a problem of lack of state oversight and competence. That company isn't capitalism. That company is a group of people making decisions, and not being held accountable by the state. A state-owned water company could be in exactly the same situation.
I think you're doing an admirable job of explaining things, but what you might be missing is that many pro-capitalist/pro-libertarian public figures seem to be constantly trying to undermine the very government oversight and competence that you are saying is the real problem with capitalism. I don't mean to suggest that you are in that camp. I'm just trying to explain why people seem frustrated with the idea that states and companies are distinct entities which should be considered separately when thinking about society. In practice they interdepend on one another and many people with power and money that inhere in private institutions actively try to undermine the state's ability to pursue them.
I think that reality is something we ought to acknowledge, although I'm not sure what to do about it. From my point of view European style socialism (modulo a few things) seems to be the optimal balance, but I'm happy to acknowledge it isn't trivial to predict in practice how anything will pan out.
The "real problem with capitalism" always boils down to:
1. Lack of competition.
2. Lack of information to reliably choose between competitors.
Which are at odds with each other. In order to ensure sufficient information, you need some kind of framework that keeps out any competitors that cannot satisfy the expected information disclosure, which generally ends up narrowing the field to the small few able to tick the right boxes. Thus, you get the tug-o-war between wanting information and wanting competition.
At the political extremes, some believe that competition is most important above all else, at the other it is believed that information is most important above all else. Interestingly, both extremes tend to lead to socialism. "Competition above all else" means that there are no encumberments in seeing co-operatives form. "Information above all else" means that government becomes so intertwined that the public ends up owning the capital. It's the middle ground where we find the "moats" that keep capitalism alive.
Socialism doesn't really change anything, though. At best you are just moving the problem around as the problem isn't actually capitalism at all. You can see the same dynamic play out even when capital isn't involved. It is much more fundamental.
> In practice, you aren't free to not do business with certain large corporations.
This is true with geographic monopolies, e.g. a company that owns water delivery pipes to people's houses. It isn't great, and suffers from the same lack of positive incentives as other geographic monopolies such as regional and national government. Even more, because at least you can vote out a tiny fraction of the latter.
But this is relatively minimal, and those companies often get nationalised, as they are utilities. That doesn't make them good; it just means that they are grouped in with the state.
It's true outside of natural monopolies, too, at least in the US. I can make a pretty long list of companies that I object to doing business with, but I have no other choice than to continue to do business with them.
> I can certainly decide which restaurant to eat at.
While you may technically be able to choose to eat at the restaurant some guy operates out of his house, someone is no doubt breaking the law in that transaction, even when all parties involved are consenting. The presence of a market does not necessarily imply that it is free.
1. capitalism as a form of free market.
2. capitalism as a form of corporatism, the kind that practiced by German conglomerates before and after the WWII.
We can argue that 1 has never being tried any where. As markets are never really free currently.
Number 2 is what the author and most people who don't like about capitalism. It is a form of authoritarianism rather than capitalism, just as how Soviet and China pretend to be communist while they were just practicing authoritarianism.
In that sense 1. is just fantastical wishful thinking. There's absolutely no way for complete free markets to exist without any sort of governmental interdiction to set rules and regulations, in the bare minimum for societal safety measures, and on a larger scope to try to minimise societal damage caused by an absolute free market.
A complete free market would allow companies to sell toxic products (including food), would allow slave labour, would allow price dumping and other anti-competitive practices, so on and so forth.
Absolute free marketism is as fantastical as believing in utopian Communism.
> It is important to disguise between: 1. capitalism as a form of free market. 2. capitalism as a form of corporatism. We can argue that 1 has never being tried any where. As markets are never really free currently.
This is the fallacy of the excluded middle. There are plenty of markets that look a lot more like 1 than 2. You can have 1 with regulations. A free market is about who's allowed to trade with whom, e.g. can I buy a car from Japan without the government adding something to the price tag (a tariff; in addition to the tax also added to the price tag)?
You can say in the extreme that regulations are not free market, or at least how they are currently implemented. Possibly state-funded bodies could generate safety logos instead of regulations, and people could check for the logo for their product, and shops could only sell with that logo, and it might work similarly, but without regulations, but instead by consumer choice. I don't see a lot of practical difference, though.
Regulations are often (or should be, in a decent capitalist system) about enforcing minimums for fair competition. So a bank has to offer so much insurance on balances. A toy company has to make sure it doesn't use cheaper toxic materials. And companies can compete within that framework. That's still pretty free trade, and definitely a capitalist system.
Types of corporatism are too broad a church to discuss, unless you specify which type you mean. But they are often nothing to do with capitalism.
The term "free", whether its in free markets or free speech, really makes it binary rather than a spectrum. You either have a free market or you don't, there's no in between.
That doesn't make it a bad thing, to be clear. Very few people actually want free speech, they want some level of control on what can be said. It sounds moral to argue for free speech so we've invented the term "free speech absolutism" to allow people in the middle to stand on that moral ground. At the end of the day though, if you want limits on speech or markets you don't want them free, and there's absolutely nothing wrong with someone landing on that moral opinion.
One of the requirements for markets is a system of law. A system of law definitionally reduces the freedom in a system.
There is no such thing as an “absolute” free market.
I think once you’ve understood why that’s true for markets, you’ll understand it’s exactly the same for free speech. Free speech absolutism is an incoherent stance.
The definition of markets is extremely simple/vague [1]. Sure we have added laws on top to make more people more comfortable participating, but where exactly is the fundamental requirement for laws to allow people to exchange goods?
With regards to speech, you simply just can't have free speech if there are limits. You aren't free to say whatever you want, and there's nothing wrong with that view. I totally understand why hate speech makes people uncomfortable and why some (a majority?) think it should be banned. Those people have just come across a reason why they don't actually agree that free speech is a fundamental right, instead preferring some speech to be restricted if a majority of people disagree with it.
The argument that you can have free speech with limitations is incoherent and goes against the entire concept. Finding a different term for some middle ground of partially regulated speech is totally reasonable, but claiming that its free is a misuse of the words.
> There is no such thing as an “absolute” free market.
A free market is typically defined as a situation where interested parties can exchange anything they so wish at any price.
"Big-brained" humans like to create all kinds rules which may make markets amongst humans unlikely to ever be free in practice, but it seems apparent that other animals regularly exhibit free markets. In what way are they not "absolute"?
Related to this, I can't quite see how we would have created laws to allow for markets before markets existed.
Someone, or a group of people, would have had to envision an entirely new system called "markets" and immediately realized that laws were needed before goods could be exchanged.
> In a capitalist system, with enough bad decisions, your company might go bankrupt.
Or your company might lobby against regulations that safeguard public health. Your company might make carcinogenic products and pressure government groups to downplay their effects[0]. Your company might consistently resist efforts to install better safety measures for chemical transport, resulting in hundreds of gallons of extremely toxic chemicals spilling and catching fire in your neighborhood[1]. Your company might contribute to pushing humanity into a doom loop of global externalities that we can't escape.
In other words, the separation of "money" from "physical power" cuts both ways. Where it breaks down in capitalism is when corporations are able to use their money to evade or neuter the government's physical power so that they can continue doing harm.
They can't use their money to evade or neuter the government's physical power. The people they pay are the government. The government is the problem in that situation, as it's responsible for making sure those things don't happen.
> The government is the problem in that situation, as it's responsible for making sure those things don't happen.
The government would certainly be complicit in this scenario, but is the corporation doing the act not still responsible for their actions? The corporation is still the actor that is motivated to do "the bad thing" (ie: cut safety features to save money), and then lobbies the complicit government to turn a blind eye. The phrasing of this seems to imply that corporations can do whatever they want as long as they play by the rules, and then puts the full blame on the government because they either failed to provide a "perfect" ruleset or they were actively complicit in turning a blind eye.
I know technically "doing whatever they want as long as they play by the rules" is in practice just following the letter of the law, but are they not responsible for taking some degree of responsibility beyond that?
I would say: the state has all the power in the situation. All the company can do is present its position as well as possible, and as long as they're not breaking the law (e.g. bribery, when it would be joint culpability) then that's fine. The company is there to provide value for its customers and shareholders, and employment for its employees. The state's whole job, for which it takes free money from every transaction in its country, is to be impartial. Outside of bribery, at best its culpability is 99%. At worst it's 100%.
The truth is:
- Company can work with government to put someone in jail. And the company has the important resource for that: money.
- A google account blocked, so someone lost their income because their Adsense or developer account is not accessible anymore. This is a violence in my opinion.
- Once you have an agreement with a company, the company can change the rule without your agreement.
> Company can work with government to put someone in jail
Yes, but that is very unusual. It requires a lot of checks and balances to get past.
> This is a violence in my opinion.
Understood. We strongly disagree here, but it's interesting. I've never considered blocking an Adsense account to be in any way similar to being locked in jail for 20 years, for example, but I'll bear in mind that this is an opinion some people hold.
> I've never considered blocking an Adsense account to be in any way similar to being locked in jail for 20 years, for example, but I'll bear in mind that this is an opinion some people hold.
I think it's the concentration of power in just a handful of players that carries the similarity, they control what you can do (not unlike the state but through economic means instead of violence).
Being imprisoned is of course much worse than losing access to your Google Account but if you depend on having a Google/Amazon/Meta account for your work (let's say, as a small business owner selling online) it will be crippling to lose access to Adsense and Instagram/Facebook Ads while losing access on selling through Amazon Marketplace. In some markets you simply wouldn't be able to compete with others that haven't lost their access, you are essentially blocked from participating in the market. And those companies' processes don't have checks and balances like a functioning government provides.
> not unlike the state but through economic means instead of violence
Well - the state can do both of these, and does.
> In some markets you simply wouldn't be able to compete with others that haven't lost their access, you are essentially blocked from participating in the market
I partly agree. However, I think - say - Youtube Creator is a career with very limited potential outside of YouTube. But that's because YouTube pays really well compared to its competitors. If YouTube paid worse, then no one would rely on it as a revenue source. It's like spending your life servicing a rich person's Model T Ford. You might be well paid, but your alternatives are no better than mechanic in a garage. That's your choice, and your risk.
I left out YouTube and instead used Amazon to show more of what can actually happen: you try to open an online store in the USA (or another market where Amazon dominates online sales to a good percentage) selling through your website, you don't get many sales that way since a lot of people in the USA will go to Amazon to make purchases, you feel that to participate in that you need to open an Amazon Marketplace storefront; you sell through that for a few years until... You get banned from Amazon's marketplace.
You didn't choose to participate in it, you were forced to due to the majority of your consumers being in that platform, you have no recourse, you have just been disappeared from business due to a private party's processes and decisions.
YouTube is another case to discuss but mostly through the eyes of market dominance, disappearance of the Open Web, and network effects. There simply isn't any other platform that can serve the market as YouTube does because of network effects. In that I usually end up in arguments about the Open Web vs this lunacy we currently experience where each platform is completely closed off and no interoperation is possible to really give a chance to competitors to raise. YouTube doesn't follow a common protocol that someone else could provide a product on and interoperate with YouTube, you either publish on YouTube or you simply cannot participate in that market. That's wrong, the web shouldn't have become that way but we allowed it.
If capitalism wants to avoid putting money in with power, then what is lobbying?
And there are plenty of examples of companies having and using violence. That in more civilized countries it happens less than before is because of the struggle of previous generations and not out of the good design of capitalism.
Mind you, I’ll take capitalism over any of the existing alternatives any day, but I think your view is very naive.
> If capitalism wants to avoid putting money in with power, then what is lobbying?
Lobbying is spending money to try and pursuade people with power to do something. That's not the same as having power. And lobbying is not a particularly capitalist mechanism. It's people talking to government.
That explanation would only work if lobbyists were limited to sitting down and having conversations with those in power. In the real world, US politicians make off with plenty of "donations" and gifts/favors that greatly influence them.
The NRA, for example, hasn't kept politicians from meaningful gun control laws because they hired the most convincing lobbyists/conversationalists.
So is it your opinion that the NRA has been so successful through words alone? That politicians have never received any financial or political gain from the NRA at all?
Sure, to first order, it isn't the same. But in practice they end up being very similar things and I think its a genuine issue with a system which justifies capitalism by saying "the excesses will be restrained by the state." In practice, capital spends quite a lot of time and money capturing and restraining the state.
I've come to feel that people are just fundamentally ungovernable at some deep level and so all solutions end up with glaring imperfections. We just have to ride the dragon of history, basically.
> capital spends quite a lot of time and money capturing and restraining the state.
To be fair, under democracy, everyone must be doing this. That is your democratic obligation. Most people just don't. And fair enough that they don't – I value prioritizing putting a roof over my head and having food to eat too!
Perhaps the takeaway here is, ultimately, that capitalism and democracy are incompatible?
I really don't know, frankly. I think to a degree one needs to have a good civil culture, but capital also works hard to influence culture for its own benefit. Maybe we just don't even have the social technology to square this circle yet.
> Yes I agree a corruption/incompetence is the cause of almost infinite ills.
-FTFY
Only recognizing when it happens in government is a cognitive bias. Assuming it’s happening in a democracy you have a vote in, you have some power to change that. When it happens in private business, you are powerless.
> Only recognizing when it happens in government is a cognitive bias.
I'm not doing this. I'm at risk of repeating myself, but it's worse in government. And government gets free money from your wallet specifically to prevent corruption, and even define it. That's much worse than a company I can stop paying being corrupt. I have no voting power to remove a corrupt public servant, unless someone runs specifically on that platform. Which no one would.
Yeah, maybe you should also spend some time reading and trying to understand the arguments others provide. Instead you post dozen copies of the same argument.
EDIT:
To make it easier for you, the part you ignore when you keep saying "government bad, companies good" is that when the companies don't do the bad things, it is typically when the government stops them. Otherwise, companies are happy to do... anything that a government would do (except for holding elections).
The line between large corporations and government is thin at best. If individuals can comfortably enrich themselves from the private sphere while in public office, if companies can modify or introduce legislation to their benefit, if even foreign policy can be influenced to benefit parts of the private sector, how can we conclude anything other than power is the outcome of enough money?
That’s as an aside. Big companies trend towards authoritarian, communist style bureaucracy due to a desire to centralize decision making (or concentrate power). This is no more effective for a corporation than it is a government. Complexity theory shows us that all the interesting stuff happens on the edge of Chaos. Big companies suck because the desire for control kills the complexity dance.
How would that be possible? Communism is much like Star Trek: An imagining of what the world might look like if we ever were to achieve post-scarcity. As far as anyone knows, we don't have the technology.
A "Communist state", meaning a state that is under control of the Communist Party, will claim a goal of working towards achieving post-scarcity, but there has been no such achievement to date.
I agree that the premise of Communism is impossible. Or rather: it relies on no progress being made, and thus all that's left to do is share out the little that we have.
Why then are we discussing an impossible situation? Why not discuss Magicism, where we imagine a world where magic has been discovered, and try to institute political systems right now that rely on this discovery being around the corner?
> Why then are we discussing an impossible situation?
The only people discussing it are you and I, and we are discussing it because you brought it up. If you don't know why you wanted to talk about it, I guess the question is unanswerable.
Everyone else was quite explicitly talking about Communist states, which means we know that the topic was about states under rule by the Communist Party. That is not an impossible situation. That is a very real situation. But communism has no state. That is one of its defining features. We know that "Communist state" fundamentally cannot refer to communism.
> Why not discuss Magicism
Well, since you also brought it up, I guess we can. But there is no evidence I am aware of that indicates magic is a thing. I am not sure where you could go with it.
Post-scarcity is a thing. According to the UN we are already there when it comes to food. Shelter has been more elusive to get us all the way to "full" post-scarcity, with it still being approximately as difficult to build a house today as 200 years ago, but slow progress is being made. It is quite conceivable that some kind of technology could change the game there, as has already been done for food.
Yet, despite already having the technology to lift us from food scarcity, many people go hungry each day. Communists will blame that kind of mismatch on capitalists creating a situation of artificial scarcity. Cases like the Monsanto story, of which you are probably familiar, provide some justification to their perspective. They believe that socialism is the only way to overcome that hurdle in order to pave the way to post-scarcity. Theories can be off base, but one can at least understand where they are coming from.
Where do Magicists come from? What is the foundation of their theory?
> Companies don't have violence and only have rules in a limited sense. E.g. a company can't lock you in a box for failing to give it some of your money
Companies certainly do "have violence" and certainly have locked people up in the past. The only thing keeping large corporations from doing this now is the state.
In the article, the author puts forth the problem with the Great Leap Forward: large central authority being disconnected from those starving workers. That's a problem large, centrally planned, corporations face.
> the author puts forth the problem with the Great Leap Forward: large central authority being disconnected from those starving workers. That's a problem large, centrally planned, corporations face.
This is not the whole truth. The problem with the Great Leap Forward was that the state enforced farming techniques, and even what farmers should work on instead of farming, and took food to bring to the centre. It's not just disconnection. Disconnection is far too vague a word to choose. To compare a company not listening to its workers with what the GLF did - it's hard to avoid thinking you picked the one vague word that could technically describe both of those scenarios, despite the vast gulf between them.
As I sort of said elsewhere - some companies are bad. That's fine, unless there's no competitor to move to. Then workers' situations are really bad, because they have to choose between retraining, moving, and staying, none of which is a great choice. But if you think that's bad, think how much worse it is that a state bureaucrat can lock you in jail, and your only option is to flee the country. Companies aren't perfect, but they limit the blast radius of the damage an incompetent or malicious employee can achieve.
People keep confusing capitalist economy with the state, and keep blaming the big bad of "capitalism" for shortcomings of the Big State, namely corruption and collusion of our politicians and lobbyists.
Also, calling whatever economic model we have in our Western countries a "free market" is an oxymoron at best. There is no free market if politicians are allowed to force it to bend one way or the other with laws and trade restrictions.
Like many words put on slogans and coopted to drive some agenda, "capitalism" and "free market" have lost all their meaning. Anyone uses those words to refer to their favourite scapegoat.
It's silly to argue that Corporations don't have violence as a tool. In a literal sense, they might not be hiring thugs to break your legs, but with money comes many good lawyers who can tie you up in court for a decade, milking every bit of money(the thing you survive with) from you. This is a form of violence, an individual is defenseless against a large enough corporation that can basically spend 100x what you can on lawyers.
I don't see the point of calling things violence that aren't. Not everything bad is violence. And only the state is allowed to perform actual violence (non-defensive).
Yes, the Libertarian view is that people should be free to enter into agreements with each other. Which is nothing like anarchy. Libertarians in no way believe people should be free to do whatever they want. Government (or at least something resembling government) is always necessary under Libertarianism. After all, who else is going to ensure that agreements are upheld? Who is going stop those who try to act absent of an agreement?
> what capitalism wants to avoid is putting "money" in with "power"
Sorry but this is plain out wrong. Under a capitalist system money IS power, as it is fundamental for survival, and that people with money are the ones that tend to have disproportionate amount of leverage both over the government and individuals.
Under capitalism the government mostly exists to protect the interests of businesses and property holders, a lot more than say the common person on the street.
No, power is power. If you're a company, you don't have the power to set rules, or lock people in boxes, or (in some places) kill people. The state has power.
Capitalism says that companies don't get power. They need money to survive, but that doesn't mean money is power. Money is money.
> Under capitalism the government mostly exists to protect the interests of businesses and property holders
No, that's not right. That might sometimes happen, but it's in no way fundamental. Under capitalism the government sets and enforces the rules, and provides currency and other bits and bobs to let people trade fairly and at a minimum standard.
> you don't have the power to set rules, or lock people in boxes, or (in some places) kill people
Quite the opposite - companies literally set rules all the time. How the work should be done, who should do what, who the boss is, when are you allowed to leave, etc.
Being obliged to be in an office is tantamount to being locked in a box for a considerable amount of your time - and you don't get to choose which part, so you end up spending the vast majority of your precious time locked in a box working for someone, because otherwise, and here we come to the last part:
Companies have the power to ruin livelihoods, cause homelessness and death, etc.
The government of capitalist countries creates that system, and has done so historically, so that the system above is upheld. And the government works mostly in favour of businesses and business owners as a whole, because it is made of said people. You are obliged to go to work for someone else or face starvation, exactly because this is a choice that was made and continues to be made by governments in favour of businesses. You are obliged to pay exorbitant amount of money to afford basic necessities. etc. etc.
> but that doesn't mean money is power. Money is money.
Exactly the opposite - money is pure power. Money is literally congealed social relationships. With little money you can't do much. With a lot of money, you go golfing with senators and lawmakers like I go for Friday beers with my mates. With a little money you're forced to continue working that deadend job to make ends meet. With a lot of money you can have a yacht bigger than the house of the person in the previous sentence (oh, wait, that person doesn't actually own the house)
> > Yet, there’s a flaw at the heart of this claim. While the United States operates as a free market economy, the key agent within modern capitalism - the corporation - works more like an authoritarian state
Yeah that's why if you try to leave google, a bunch of guys show up with baseball bats and crush your knees to pulp.
> companies today hire workers to make money from their labor. In other words, they generate profit because they pay their employees less than they’re worth. If everyone could trade their labor for exactly the amount of money it was worth, the corporations that employ them would have a much harder time making money. Instead, in modern corporations the shareholders and the executive team - again, the central planning committee we so despise - make the majority of the money
This is normal and natural. In a corporation, some stakeholders contribute cash, and other stakeholders contribute labor. Both are forms of capital. It is the combination of both that allows them to become more than the sum of their parts, and in doing so, generate wealth. There's plenty of room for criticism about just how much of the generated wealth should flow to those who invested cash compared to those who invested labor, and reforming the tax code so that it is easier to compensate with shareholdership those who invest with labor. But corporations should earn more from the labor than the labor is worth. That forming a corporation begins a positive-sum game, and not a zero-sum game, shouldn't be controversial.
> I know the solution is not more freelancing and contract work, which America’s corporations are addicted to. That’s the worst of both worlds: The exploitative nature of capitalism with the inefficient bureaucracies of communism. Transactions on the free market work because they’re good for both sides, but most people only accept part-time contract relationships today when they have no other real choices.
I think the author is holding up very specific contractual relationships as a scapegoat here; e.g. "gig economy" work a la Uber drivers, or the "contractors" who are fleecing the state of California out of billions of dollars for the high-speed rail project. And fair enough. But buried in both of those scapegoats is a clue: the "solution" is not individuals accepting take-it-or-leave-it short contracts presented by a robot taskmaster, nor is it BigConsulting agglomerating tens of thousands of warm bodies sold out by the hour, any more than the solution is sole proprietorships sewing dresses in their living rooms or the massive bureaucracies of Fortune 100 companies. Rather, it is in small and medium businesses, and giving contracts to other small and medium businesses; every one running small enough to keep executives in touch with line workers.
Don't grow headcount further than (Dunbar's number - friends and family =) 100. If you feel tempted to do so, see what you can spin off and become their initial primary customer. Look to the Mittelstand as a model.
> > companies today hire workers to make money from their labor. In other words, they generate profit because they pay their employees less than they’re worth. If everyone could trade their labor for exactly the amount of money it was worth, the corporations that employ them would have a much harder time making money. Instead, in modern corporations the shareholders and the executive team - again, the central planning committee we so despise - make the majority of the money
It's frustrating to see so many thinkpieces keep basing themselves upon the Labour Theory of Value, while it has been long debunked.
To use a stretched analogy, it's like a blog on vaccines basing themselves off Andrew Wakefield's work. It should not be taken seriously.
> The labor theory of value leads to obvious problems theoretically and in practice. One critique is that it is possible to expend a large quantity of labor time on producing a good that ends up having little or no value. However, a closer reading points to the fact that commodities conforming to the LTV would have both a use-value and an exchange-value, and be reproduceable. Therefore something that has no demand in the market or with little or no use-value would not be considered a commodity according to the LTV. The same would go for a unique object such as a work of fine art, which would too be excluded. It may take one person longer than another to produce some commodity. Marx's concept of socially necessary labor time does also get around this problem.
> A second critique is that goods that require the same amount of labor time to produce often have widely different market prices on a regular basis. Moreover, the observed relative prices of goods fluctuate greatly over time, regardless of the amount of labor time expended upon their production, and often do not maintain or tend toward any stable ratio (or natural price). According to the labor theory of value, this should be impossible, yet it is an easily observed, daily norm.
> The labor theory of value leads to obvious problems theoretically and in practice. One critique is that it is possible to expend a large quantity of labor time on producing a good that ends up having little or no value. However, a closer reading points to the fact that commodities conforming to the LTV would have both a use-value and an exchange-value, and be reproduceable. Therefore something that has no demand in the market or with little or no use-value would not be considered a commodity according to the LTV. The same would go for a unique object such as a work of fine art, which would too be excluded. It may take one person longer than another to produce some commodity. Marx's concept of socially necessary labor time does also get around this problem.
This critique mixes the concepts of "individual value", "social value" and "price". These are entirely different things for Marx, but the comment acts as if they are the same thing. If you take too much time and effort creating something, the individual value created is wasted because the basis for exchange in society is the social value, based on the time and effort socially needed to create the item given the current technology and social organization. This is a very naive critique, answered on the first chapters of Das Kapital. Moreover, unique items can have a price, even if they do not have value (the honesty of a corrupted cop have a price if he accepts bribes, but has no value).
> A second critique is that goods that require the same amount of labor time to produce often have widely different market prices on a regular basis. Moreover, the observed relative prices of goods fluctuate greatly over time, regardless of the amount of labor time expended upon their production, and often do not maintain or tend toward any stable ratio (or natural price). According to the labor theory of value, this should be impossible, yet it is an easily observed, daily norm.
This critique is valid only for naive labor theory of value. Marx spent most of third volume in Das Kapital talking about this, and agreeing that the prices are not equal the value: these two things would be equal only if the capitalist economy was composed just by a single industry, or if the composition of different types of capital were the same for all industries. In a complex economy, with many different industries, the competition between capitalists and their search for profits causes some products to be sold below their value and others above it, as a consequence of the tendency to equalize profit rates that this competition generates. This paragraph criticizes the naive LTV from Smith and Ricardo, but not the Marxist one.
People always conflate capitalism with a free market. They're different things. Capitalism just means that capital (the means of production) is privately owned, rather than being owned by a collective of workers (socialism) or the state (communism). Controlled markets can still exist under capitalism, such as by monopoly. Standard Oil controlled the market for oil in its heyday and regulated the supply to keep the price stable to avoid the boom/bust cycles that happened before they consolidated the market. The government can still regulate the market, as it does extensively in the US, without changing the fundamental fact that the means of production are privately owned.
+1 came here to point out what should be obvious: the US is not, and has never has been, a free market. There is, and always has been, "rules and regulations" beyond the "natural" which dictate the behavior of the market.
The closest thing I'm aware of to a free market was the cryptocurrency driven markets of the "Dark Web" somewhere between the rise and fall of Silk Road. Yet even that market was embedded within, and ultimately governed by, the jurisdictions the network was hosted.
Balancing the interests of private capital, the free market, the state (society) and workers is what Germany is trying to achieve with the Social Market Economy ("social capitalism"):
Just wanted to point out that the distinction between communism and socialism is not whether it's the state that owns things. In fact there is no distinction. They are one and the same and both refer to workers owning the means of production.
There are different types of communism, based on what that means. i.e. Leninists would generally believe that the state is representative of the people, via dictatorship of the proletariat and all that. Whereas council communists would have none of that and would prefer no state and councils of producers and consumers, and once you start digging into anarchism, you will find a bunch more other varieties of communism.
Personally, I've come to realize that capitalism, communism, socialism are simply semantic pits that don't really mean anything. If you say these words to people they have wildly different interpretations of their definitions and the arguments that arise from this discord are usually both heated and pointless.
Words are meant to communicate things, if they aren't communicating your intent then why even bother using them? While they still have some vague relevance from a historical perspective, like when discussing the cold war, I think any contemporary discussion where one feels the use of these words might be necessary would be better off just listing their ideals directly instead of falling into this semantic trap.
Agree, these terms are bordering on meaningless. I think they suffer from reification, or something like it.
What's worse is that people will assign a meaning to those terms, not bother to tell anyone that meaning, and yet use the term in discourse with others who they know don't assign the same meaning. It's infuriating.
What everybody really thinks is "people should be free to do good or trivially bad things, and shouldn't be free to do materially bad things".
That is also socialism. Communism is an imagining of what the world will look like after entering a state of post-scarcity. In fact, part of what is imagined in that is that we will become stateless. After all, absent of scarcity, what would you need a state for?
Now, it was once theorized that capitalists would artificially withhold entrance into post-scarcity and that the only way to achieve post-scarcity is, first, for the state to take over the means of production. This theory bred the Communist Party. States under rule of the Communist Party are often called Communist, but in that vein does not refer to capital ownership, but rather the party in power.
Socialism has never been fully realized, as under communism the surplus and means of production were controlled by the state, not the workers. It was state capitalism.
If you accept that socialism can exist alongside capitalism, then it most definitely has been realized. Travel to just about any rural area and you will find co-ops galore. A very least in providing means of production to farmers, but quite often beyond – telcos/ISPs, grocery stores, gas stations, etc.
If you see socialism as only some kind of state where capitalism no longer exists, then sure, we've never gotten there. Probably never will. Hell, even if post-scarcity communism is someday realized, it is equally possible that we got there by way of capitalism. Just because someone theorized that capitalists would put up roadblocks on the way to post-scarcity doesn't necessarily mean they would or that they couldn't be overcome.
""I know the solution is not more freelancing and contract work, which America’s corporations are addicted to. That’s the worst of both worlds: The exploitative nature of capitalism with the inefficient bureaucracies of communism.""
""... but most people only accept part-time contract relationships today when they have no other real choices.""
Great to point out.
Free-Market would require people to be free. But if you work for the company in the company town, you're not free.
An interesting exercise I went through while reading this article was taking these observations about centrally-managed top-down organizations and considering them in the context of centrally-controlled distributed systems. A couple of snippets:
> One of the core principles of the free market is that central planning committees can never be as efficient or as effective as the people doing the work. By definition a free market economy lacks a decision-making hierarchy; the ‘free’ means every agent (individual or corporation) can decide for themselves, without needing permission from a manager above.
> ...
> It should be immediately obvious why this fails miserably: The distance between the central planning committee and the farmer is so great that good decisions are nearly impossible. It’s nearly impossible for critical feedback to make it from the edge, where the farmers are working, to the central planning committee in time to affect decisions, and then for those decisions to make it back to the edge in time to be useful.
One of the core arguments for using a centralized control plane (versus a distributed one) is the ability to perform a single global optimization, which can yield better results compared to local optimizations. I find it interesting that the free market principles dictate the opposing conclusion that this global optimization is infeasible, although it may come down to my next point:
If you're not careful, and your centralized system injects dozens of minutes of delay due to the additional complexity of performing the global optimization, you end up with the globally optimal decision from 20 minutes ago, which in the context of, say, load balancing is an eternity. Or in the bureaucracy of government (or hardware planning cycles, etc), you may see months to years of lag between the inputs your model accepts, and the outputs your model produces. And all the while, you have a full pipeline of decisions coming down the line, based on stale data.
(There are other reasons for centralized control, such as orchestration of distributed computation being difficult to do correctly, and it being easier to reason about a single node rather than the complex system-wide interactions.)
While I see where you are coming from, I don't think the free market has much to do with it, as "free market" to the extend that such thing exists outside the fantasies of ancap weirdos, is just one of many types of distributed decision making systems, and as such shares a lot of traits with them.
So it's a question of organising big systems and how best to do that. Nothing says that we can't have organisations structured around this decentralised decision making, and quite the opposite - we both have the evidence this works, and it has been so thoroughly studied there are tons upon tons of pages written going back all the way to the 20s ...
Another factor which may come into play is inaccuracy. In a distributed system where there is a known algorithm for making local and global decisions that are as-close-to-optimal as the algorithm can determine, then everyone gets to benefit from the increased knowledge present at a global level rather than at a local level. In the human world, some people simply make bad decisions, since there isn’t an algorithm for a lot of leadership decisions. If that person is the global decision maker, then rather than everyone benefitting, everyone suffers; whereas with a local decision-maker, only a small group suffers if the leader makes a bad decision (and hopefully other leaders pick up the slack).
It’s also partly because a distributed system can factor into its decision-making a vast amount of information, as where humans may not have sufficient understanding of all areas (and again, decisions are not algorithmically optimizable) to make the proper decision. As where more knowledge can help an algorithmic decision-making process, it can overwhelm a human one.
My experience is that more knowledge can help an algorithmic decision process make a better decision, but it can also take longer to make that decision when you're dealing with combinatorial explosion. When you inject delay into a feedback system, you almost always will introduce oscillations. (You can do some things to partially correct for it, but that works best when you have a predictable and consistent amount of delay.) Intuitively, you can think of this as taking too long to respond, and then overcorrecting time after time, since you keep overshooting your target and not realizing that you've overshot for some time.
That said, computer systems are similarly prone to inaccuracy. Perhaps not to the same extent as human organizations, but they have similar propensity to fail spectacularly. If you fail to model certain characteristics of the system (or model them poorly), then you can end up in a situation where your load balancer is causing significant congestion and not thinking anything is wrong. Or your hardware planning pipeline thinks that it has lots of spare capacity even though you're overflowing every day at peak. Or your central planning committee for the government thinks you have lots of excess grain production when that's simply not the case in reality.
(Algorithm implementations can also be outright buggy.)
Another way your model can fail is if you treat resources as infinitely fungible. Suppose you have enough food in Shanghai to feed two billion people, but no food anywhere else in China. Without an adequate transportation / distribution network, everyone outside Shanghai is going to starve, and all the excess food in Shanghai is going to rot. Similarly, your servers in California aren't going to do very much for users in India if you don't have the infrastructure to actually serve that long-haul traffic.
Another point that I didn't bring up, but related to your point about global vs local decision makers, is that centralized systems have much larger blast radius. In the case of China during the Great Leap Forward (one of the examples from the article), bad decisions led to famine across the entire country. In the case of a global load balancer, you can break your service globally.
>If you're not careful, and your centralized system injects dozens of minutes of delay due to the additional complexity of performing the global optimization, you end up with the globally optimal decision from 20 minutes ago, which in the context of, say, load balancing is an eternity.
That actually doesn't seem avoidable, because some of this time will need to be spent identifying risk and malice/corruption.
> Instead, in modern corporations the shareholders and the executive team - again, the central planning committee we so despise - make the majority of the money, while the front line does all the work and makes very little.
The answer to that one is unionization.
Unfortunately, unions are rather looked down upon in tech, for fears that "high performers" would not be able to set themselves apart financially from "low performers". And as a result, everyone loses out.
> The biggest problem is that we have no idea how to value most of the work people do. I mean, we might know that what a developer should get paid for a year’s work, but how much is that work worth? The majority of the work done in modern corporations is incredibly hard to value, which is partially why companies are so inefficient and make so many bad decisions.
> That brings up an even bigger problem - companies today hire workers to make money from their labor. In other words, they generate profit because they pay their employees less than they’re worth. If everyone could trade their labor for exactly the amount of money it was worth, the corporations that employ them would have a much harder time making money.
Anyone else see an issue with this comment? We don’t know how to value the work of a corporate employee but we’re simultaneously all being paid less than we’re worth.
I like this article but I do feel the author leans too much into theory and what I hope is hyperbole. What I do love though is the admission at the end that we’re in a tough spot with modern capitalism and there’s no easy way to fix things by some “just do xyz” solution.
Since he is a founder that built the business, I'd say he is someone that has a lot of practical knowledge beyond theory. He saw both sides, and sees the flaws in both.
How many times to do talk about the sales guy that earns too much, or so-and-so, that got promoted for being nice. Everyone is always complaining about others getting paid more, and that wouldn't happen if the pay was equal to value.
Or, how about in Software, there are a lot of teams adding features, which one was worth more? It is hard to tell, but everyone seems to agree the guys at the top didn't contribute much. So, it seems like the math would work, the guys at the top don't produce much value, but get more money than the teams adding value. Even if how to calculate each individual value is difficult.
We can have essentially no idea what each contribution to the whole is worth while being certain that the whole must, over the long term, be less than value X.
There's definitely some aspect of hyperbole, just from the wording there: "the biggest problem is [...], but wait, there's an even bigger problem [than the biggest one]!"
Comparatives overriding superlatives aside, I don't necessarily see these two issues as at odds with each other. We are bad at assigning dollar amounts to units of work, or even the productive output of a specific individual, but in aggregate companies can know how much revenue they bring in, and how much they spend (on labor, among other things), and in order to be profitable, revenue must exceed costs by definition.
So taken in aggregate, companies are still able to exploit the gap between cost and value of labor. A highly productive individual might be significantly underpaid, but on the flip side, a less productive individual might be overpaid at the same company.
> Anyone else see an issue with this comment? We don’t know how to value the work of a corporate employee but we’re simultaneously all being paid less than we’re worth.
Think of it as a general rule of thumb, a statistical average. You will for example find that often managers and executives make a crazy amount of money, but are all but useless, but are only a small part of the bigger company.
The may be often useless to people under them, but that's irrelevant for company itself. Owners look from very different perspective than bottom employees, and companies have a single purpose - make money to the owners, academic discussions be damned.
Should each owner run around and tell each employee globally how to do their job, what is the goal, budget, restrictions, rules, timelines etc? This is a massive vacuum that needs to be filled, and managers fill it. Some better, some worse, just like any other profession.
Generally weird article to be polite, probably put together in a haste to give benefit of a doubt to the author.
> This is a massive vacuum that needs to be filled, and managers fill it.
One problem is that the amount of "vacuum" that needs to be filled is often also decided by the managers, and many of them start creating work for themselves. Suddenly every team and every project needs to have a separate Jira and Confluence instance, there are meetings every day but most of the meeting is just reviewing the same information you have reviewed yesterday, etc. And the budgets, yeah, with so many managers there is hardly any money left to hire anyone else.
> Should each owner run around and tell each employee globally how to do their job, what is the goal, budget, restrictions, rules, timelines etc?
Of course not, but there are many useful ways to organise this. Hell you can still have managers, but make them elected from the body of workers. It's more that because of the first thing you said (with which I agree) these managers are basically cops or wardens.
> You will for example find that often managers and executives make a crazy amount of money, but are all but useless, but are only a small part of the bigger company.
They are all but useless, sure, but much, much more valuable people as they hold a scarce property that nobody else working for the company has: Trust. Value is defined by the relative scarcity of something desired.
> We don’t know how to value the work of a corporate employee but we’re simultaneously all being paid less than we’re worth.
A number of people do work and create wealth, and then every quarter a dividend is sent off to some heir. "Being paid less than we're worth" as you characterize it. There are people who work, and heirs who parasitically expropriate surplus labor time from those of us who work. Workers work and create wealth, and then whatever remains of that after external expenses is divided into wages for the people who did the work and created the wealth, and the heir who does not work expropriating their profit. This is the being paid less than they are worth part - if the heir was not sent their dividends, the workers who created the wealth would not send off those dividends and that portion of the division would go to wages as opposed to dividends.
That they don't know how to value the work of a corporate employee doesn't trouble me in regards to the just mentioned fact.
If two workers create $240 of wealth in a day, and $60 is sent off as a dividend, and the one who worked 8 hours made $120 in wages, and the one who worked 6 hours makes $60 in wages - then there are methods that might approximate their actual work. One would be to take the $60 going to the heir and give $20 more to who worked 4 hours and $40 more to who worked 8 hours.
I think we can get to this answer by looking at a couple of questions from an accountant's perspective. The first: Where does profit come from? Somewhere there must be an arbitrage. Next question: Why isn't that arbitrage competed away? Further to the point, there must be some universal arbitrage available to all industries to create "profit" in every single case. There are very few commodities that are universal across industries, such as electricity, land, and workers. Because of the universality of profit (or else all businesses would not exist long term), some universal input would be a prime candidate for a source of such universal arbitrage.
The next step is to think about Commoditize Your Complement [0]. Given that selling work is a universalized commodity, and sheer numbers of workers competes away all profits, what is the complementing field? Employment. Employers monopolize Work to extract the value away from their complement; workers. With being a commoditized complement brings with it the cutthroat competition just to keep the lights on, while value floats to all the businesses in the complement.
However none of this is permanent in the Macro. During boom times all boats float. All firms hire from the same pool of workers, driving available workers down and prices/wages up. This drives employers into the arms of productivity machines to control the spiraling costs of labor. This is a trap. While you might gain productivity, it shifts more of your investment away from the Universal Arbitrage (workers) towards productivity machines, thus becoming the commoditized complement of the makers of productivity machines.
Finally, I want to point out that these are general forces and not destiny. Also Reality is fuzzy, and none of this addresses stuff like Bailouts and other extra-economic interventions. Just because something is profitless in the long term does not mean it can't be profitable to you in the short-to-medium.
> And these companies, they use the same kind of central planning that we so despise in communist systems. I know. I’ve done it.
The work of János Kornai made us realize that it is impossible to find an exact solution for economic planning, so a completely centrally planned economy is destined to have major inefficiencies (he was also a notable inspiration for the Chinese reformers). It also seems like some kind of planning is inevitable in market economies to achieve long term goals as market prioritizes short term gains.
> Modern capitalism raises the flag of the free market while pitting centrally planned organizations against each other
That sounds like it's a gotcha, but it just isn't. Markets is about limiting the blast radius of bad dictatorships WAY DOWN. That's also why big corporations should be something that scares everyone. Maybe this isn't what the theoreticians think it's about, but that just makes the theory wrong, not the system.
> Millions starved during the Great Leap Forward because the central organization was trying something impossible: Managing the productive output of an entire country.
That's just one part of the problem and not even the biggest.
They also:
- moved all big farms from the "capitalists" who knew how to run them to random people who didn't (this has been done in several countries without planned economies and the disaster was just as big)
- decided to kill all birds in the fields because they thought they ate the grain (they ate the insects that ate the grains)
- ordered planting too close because of political ideas (even though the Soviet experts told them not to do this since the USSR had already tried this and had famines to prove it)...
on and on it goes... In short the central planning is just the tip of the iceberg of Chinese communist mismanagement.
> today’s most vaunted tech leader, Steve Jobs, was famously disrespectful of the opinions of others, yet made a lot of world-changing decisions
Not even close. He didn't accept people opinions and he didn't ignore them politely: he challenged them. If you convinced him he changed his mind super fast. "Strong opinions, loosely held".
This is what actually respecting others opinion looks like. It's just that most of us has never existed in a social situation where respect for opinions/ideas exists. We life in a world of pseudo-respect where we basically nod when people talk and ignore them.
1) Big companies have an enormous amount of friction and hassle that must be overcome to get things done. This is by necessity -- workers have to be coordinated with each other, and the more of them there are, the more overhead is required to accomplish that.
2) Big companies are boring to work for. Even when they're doing interesting things in the big picture, you're not likely to be working on the interesting bits. And when you are, it will be done in a way that makes it as tedious as possible.
I know many people with sensibilities similar to mine. I also know many people who strongly prefer to work for big companies. Big companies are just a different sort of beast, and if you enjoy riding it then more power to you. It's just not for everyone.
It is important to realize that big companies are friction free to a small set of folks; you will note marked tiers of less friction at some earlier point. You appear to have had a full-friction experience.
This mostly has to do with top-down control and trust and should you get to do what you want to do because it’s maybe probably locally optimal but you didn’t notice the 5 semi trailers that will crush you on your current trajectory.
Your last two sentences are fair enough, but perhaps this adds some context.
I liked this article a lot and got excited because the issue resonated with me, and I wanted to see what the solution was. Then the article ended! Haha. Well apparently this is an unsolved problem in society.
It would be interesting to run a company like it’s the free market, where you give out money based off how effective the individual parts of it are. But that’s basically done already, the issue is that work done by humans is not quantifiable and comparable at scale.
Hopefully LLMs when given the reasoning upgrade can perfectly measure all of our contributions and then we can get rid of the central planning group (since they’re so costly) and replace it with some AI
> the issue is that work done by humans is not quantifiable and comparable at scale.
If the company as a whole can buy human work per hour, perhaps so could the intra-company free market.
Imagine a company that hires people for "minimum wage + bonus". Internally, the company consists of projects; each of them can 'hire' any willing employee currently not assigned on a project; and if an employee is not 'hired' by any project for 6 months in a row, the employee gets fired by the company.
Maybe even more interesting would be a system where for each N months worked on a project you gain 1 month outside projects, and if you accumulate enough such months, you could try starting a new project within the company.
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[ 15.5 ms ] story [ 373 ms ] threadThe parts I hate are those planned centrally; which thankfully right now are mainly limited to IT, budgeting / expenses, etc. You can completely tell that at the CTO level it looks like we're saving gobs of money by planning centrally; but at the local level you can see that in fact what's happening is the costs are being externalized into other areas in ways that are difficult to measure, but probably end up costing the company at least 3x.
In my experience, the middle managers were more miserable than the peons. When I became a manager, I hated it.
Only the tippy-top managers really seemed to like their job, and they tended to use the company dime for most of their frou-frou.
That said, I very much enjoy not working for big companies, anymore.
Is there political corruption and abuse that keeps you there?
It is possible to know something is wrong, and feel guilt, but still take the money and continue to voice these ideas about change.
It is hard to change a system when you are winning it. That doesn't mean he isn't also right that a lot of people are victims of it.
""In other words, they generate profit because they pay their employees less than they’re worth. If everyone could trade their labor for exactly the amount of money it was worth, the corporations that employ them would have a much harder time making money. Instead, in modern corporations the shareholders and the executive team - again, the central planning committee we so despise - make the majority of the money, while the front line does all the work and makes very little.""
Global capitalism is devastating because it is about creating a world where the end result is everyone in subservience to a highly fragile infrastucture in return for immense short-term wealth for a few (big-tech employees are in this category).
The size of business should be limited and corporations should be destroyed!
Lower standards of living, lower cost would be like the difference between a budget hotel and a 5 star at the beach, lower standards is vacationing in Iowa instead.
You'll hear people say things like "culturally they like to live ten to a single room tin shack" but that wouldn't be the case if they had wealth. It's not a choice, they are just paid less and that is being used as a justification for continuing to do so.
Ask young people in India today if they want to live with Grandma, more and more say no compared to a generation ago. The wealthier they get the more this will continue.
Standard of living is an input for cost of living. You can go to a lower standard area and have above average quality of life for yourself because the competition is lower (you're effectively rich there). Sure, maybe you need an RO filter on your tap (there are places in the US where you may need this too), but even if the filter cost is the same, the water cost will generally be lower as would the instalation labor, etc.
While I agree it may be necessary to limit the size of companies, I completely disagree with the reason you give. It's not about the poor being easier to exploit. It really is about optimising global networks. If Eastern Europeans are both better programmers (even if you disagree, at least concede that programmers/workers may generally be "better" or "more efficient" or whatever in some region that's not yours) and much cheaper, and it's not relevant in which geographic location your product comes from, why would you keep your production in a less efficient and more expensive place? To not allow that would be similar to not allowing free competition between workers in general unless you consider for some reason that the international market should not be free (which is becoming more and more popular recently, but with which I strongly disagree - developed countries were 100% in favour of free market only while they were far and away the biggest beneficiaries of such system... now that others can compete at the same level all of a sudden it's not a good thing anymore).
How do you think areas where people get paid less will ever get higher salaries if you insist in making it harder for companies to provide jobs to those who live in such areas. It's true that this may eventually go both ways: i.e. the people in lower cost areas will start getting paid more while the people in the higher cost areas will start getting paid less. Do you find that is less just? If so, why? I find that it's much better to raise the salaries for people in lower paid areas because those people can finally raise to a decent level, while those in higher paid areas will just be a little bit less able to keep their luxuries while still keeping most of their comforts.
Where we agree is that if we allow this system to go on unencumbered, eventually only one place will produce everything (sounds familiar?), only one company will dominate each area of business, and so on. And that is antagonistic to capitalism, and coincidentally, to the wellbeing of workers and consumers as well.
The reason why we disagree is because I disagree with free competition on a global scale, and in turn disagree with economic efficiency as a good thing in absolute terms: there is a limit, past which if we become too efficient, it implies too great an abuse of the commons.
I don't think we should have global competition for programmers: we should be more locally self-sufficient and face the consequences of our actions in our own backyard. If Eastern European programmers are better, well that is all well and good, but then that IMPLIES that people in your HOME country are NOT becoming programmers, and eventually this chain has to end somewhere, likely with SHIPPING something overseas, which in turn is unsustainable. At some point, this is likely to result in abuse of the common good (biosphere), much more so than if we stayed local.
Think about it economically: the only reason why you can even PAY eastern europeans is because your currency can be exchanged for theirs, which means that they probably want some physical product of yours.
We could get really far by simply removing legal and political protections that make massive companies possible. If companies and their leadership could actually be held accountable by employees and consumers, they would be much more hesitant to continue to grow and chase profits indefinitely.
Similarly removing tax loop holes would also likely help. Massive companies get to a scale where they can play ridiculous tax games that just aren't possible on a smaller scale.
Rather than trying to fix one symptom of that, corporate legal power, we should fix the legal system itself.
https://www.ribbonfarm.com/2009/10/07/the-gervais-principle-...
I'd say that generally speaking I have not. I've made it to a point in my career where I interact with the top management at Fortune 100 companies and I have not at all found them to be psychopathic or power-hungry. Actually generally the opposite: those traits seem to be selected against.
There are of course counter examples but I'd argue they're rare.
I'd say that you'll find the psychopaths and power-hungry individuals in the middle layer of companies with the "do nothing" bureaucrats at the bottom of the management hierarchy, often without any formal people management titles at all.
In corporate politics there is only one thing that 'wins' and that is profitability. That profitability comes from the workforce so the top leaders are usually very motivated, democratic people because the best ideas win and you need people on your side.
Thinking about the public sector, there is no KPI for a 'win'. When we try to start using statistics it becomes 'political', skewered, or hand waved away as a complex marcoeconomic force.
Scheming, lying and political maneuvering at the expense of your peers is how you become the fake-friendly "Bob" or "Mike" calling the shots at the top. Non-founders who raise through the ranks largely depend on these traits. Feelings and empathy are selected away as they lead you to be passed over in promotions.
But yes, the observation you mentioned is indeed interesting. Hence the tendency of many people to think that states would also be better if run like a corporation, the desire to elect leaders that are (or pretend to be) successful managers, and that other observation that capitalism is not synonymous with democracy (and adopting capitalism does not automatically lead to democracy, as can be seen with China).
I think that you're making that up, dictators don't really need to be oppressive to remain in power. If that was true, most dictators would be quickly replaced early in their reign because there would be so many "more oppressive" people nearby, and that would only stop after "selection" done its job and a truly difficult to replace oppressive ruler was found. But that's never the case! When a dictator raises to power, usually chosen by the elite, they tend to remain in power for several decades.
This isn't particularly true, but where it is, it isn't a flaw. This is as designed.
Where it's true: what capitalism wants to avoid is putting "money" in with "power" (i.e. "violence" and "rules") that the state has. Companies don't have violence and only have rules in a limited sense. E.g. a company can't lock you in a box for failing to give it some of your money. Only the state can do that. Having corporations limits the blast radius of what malicious/incompetent employees can do. In a capitalist system, with enough bad decisions, your company might go bankrupt. In a communist one, with enough bad decisions, 50 million people might starve to death[0].
Where it's not true: companies exist through free agreements between people. You might argue that they aren't free enough, although that gets vague fast, but you can't opt out of the state. That's the problem with authoritarian states. You can move job. Or, if you argue that people can't move job, the problem is so much harder for moving state that the point still stands.
[0] https://en.wikipedia.org/wiki/Great_Leap_Forward
Also, 'you can move jobs' is not really true for most people and 'not-as-bad-as' is no argument, it's a fallacy
I'd argue the enormous amount of private money in politics is evidence against this being the case in practice, along with the well-recognised notion that outcomes in the justice system often depend on how much you can afford to spend on legal representation. Yes there's a lot of formal separation between what is public and what is private, but the realpolitik is that (for example) the water company pouring untreated sewage into the rivers has much more power than the people affected by that practice.
This is true, but it's purely a problem of lack of state oversight and competence. That company isn't capitalism. That company is a group of people making decisions, and not being held accountable by the state. A state-owned water company could be in exactly the same situation.
I think that reality is something we ought to acknowledge, although I'm not sure what to do about it. From my point of view European style socialism (modulo a few things) seems to be the optimal balance, but I'm happy to acknowledge it isn't trivial to predict in practice how anything will pan out.
1. Lack of competition.
2. Lack of information to reliably choose between competitors.
Which are at odds with each other. In order to ensure sufficient information, you need some kind of framework that keeps out any competitors that cannot satisfy the expected information disclosure, which generally ends up narrowing the field to the small few able to tick the right boxes. Thus, you get the tug-o-war between wanting information and wanting competition.
At the political extremes, some believe that competition is most important above all else, at the other it is believed that information is most important above all else. Interestingly, both extremes tend to lead to socialism. "Competition above all else" means that there are no encumberments in seeing co-operatives form. "Information above all else" means that government becomes so intertwined that the public ends up owning the capital. It's the middle ground where we find the "moats" that keep capitalism alive.
Socialism doesn't really change anything, though. At best you are just moving the problem around as the problem isn't actually capitalism at all. You can see the same dynamic play out even when capital isn't involved. It is much more fundamental.
Works mainly in a more or less equal society of small businesses. I can certainly decide which restaurant to eat at.
In practice, you aren't free to not do business with certain large corporations.
> You might argue that they aren't free enough, although that gets vague fast
It's in the vagueness that the problem exists, so we shouldn't sweep it away just because there's a lack of clear lines.
> but you can't opt out of the state
You can't, and that's why the state has a lot of the same issues as the large corporates.
This is true with geographic monopolies, e.g. a company that owns water delivery pipes to people's houses. It isn't great, and suffers from the same lack of positive incentives as other geographic monopolies such as regional and national government. Even more, because at least you can vote out a tiny fraction of the latter.
But this is relatively minimal, and those companies often get nationalised, as they are utilities. That doesn't make them good; it just means that they are grouped in with the state.
While you may technically be able to choose to eat at the restaurant some guy operates out of his house, someone is no doubt breaking the law in that transaction, even when all parties involved are consenting. The presence of a market does not necessarily imply that it is free.
1. capitalism as a form of free market. 2. capitalism as a form of corporatism, the kind that practiced by German conglomerates before and after the WWII.
We can argue that 1 has never being tried any where. As markets are never really free currently.
Number 2 is what the author and most people who don't like about capitalism. It is a form of authoritarianism rather than capitalism, just as how Soviet and China pretend to be communist while they were just practicing authoritarianism.
A complete free market would allow companies to sell toxic products (including food), would allow slave labour, would allow price dumping and other anti-competitive practices, so on and so forth.
Absolute free marketism is as fantastical as believing in utopian Communism.
This is the fallacy of the excluded middle. There are plenty of markets that look a lot more like 1 than 2. You can have 1 with regulations. A free market is about who's allowed to trade with whom, e.g. can I buy a car from Japan without the government adding something to the price tag (a tariff; in addition to the tax also added to the price tag)?
You can say in the extreme that regulations are not free market, or at least how they are currently implemented. Possibly state-funded bodies could generate safety logos instead of regulations, and people could check for the logo for their product, and shops could only sell with that logo, and it might work similarly, but without regulations, but instead by consumer choice. I don't see a lot of practical difference, though.
Regulations are often (or should be, in a decent capitalist system) about enforcing minimums for fair competition. So a bank has to offer so much insurance on balances. A toy company has to make sure it doesn't use cheaper toxic materials. And companies can compete within that framework. That's still pretty free trade, and definitely a capitalist system.
Types of corporatism are too broad a church to discuss, unless you specify which type you mean. But they are often nothing to do with capitalism.
That doesn't make it a bad thing, to be clear. Very few people actually want free speech, they want some level of control on what can be said. It sounds moral to argue for free speech so we've invented the term "free speech absolutism" to allow people in the middle to stand on that moral ground. At the end of the day though, if you want limits on speech or markets you don't want them free, and there's absolutely nothing wrong with someone landing on that moral opinion.
There is no such thing as an “absolute” free market.
I think once you’ve understood why that’s true for markets, you’ll understand it’s exactly the same for free speech. Free speech absolutism is an incoherent stance.
With regards to speech, you simply just can't have free speech if there are limits. You aren't free to say whatever you want, and there's nothing wrong with that view. I totally understand why hate speech makes people uncomfortable and why some (a majority?) think it should be banned. Those people have just come across a reason why they don't actually agree that free speech is a fundamental right, instead preferring some speech to be restricted if a majority of people disagree with it.
The argument that you can have free speech with limitations is incoherent and goes against the entire concept. Finding a different term for some middle ground of partially regulated speech is totally reasonable, but claiming that its free is a misuse of the words.
[1] https://en.m.wikipedia.org/wiki/Market_(economics)
A free market is typically defined as a situation where interested parties can exchange anything they so wish at any price.
"Big-brained" humans like to create all kinds rules which may make markets amongst humans unlikely to ever be free in practice, but it seems apparent that other animals regularly exhibit free markets. In what way are they not "absolute"?
Someone, or a group of people, would have had to envision an entirely new system called "markets" and immediately realized that laws were needed before goods could be exchanged.
Or your company might lobby against regulations that safeguard public health. Your company might make carcinogenic products and pressure government groups to downplay their effects[0]. Your company might consistently resist efforts to install better safety measures for chemical transport, resulting in hundreds of gallons of extremely toxic chemicals spilling and catching fire in your neighborhood[1]. Your company might contribute to pushing humanity into a doom loop of global externalities that we can't escape.
In other words, the separation of "money" from "physical power" cuts both ways. Where it breaks down in capitalism is when corporations are able to use their money to evade or neuter the government's physical power so that they can continue doing harm.
[0] https://en.wikipedia.org/wiki/Monsanto [1] https://en.wikipedia.org/wiki/East_Palestine,_Ohio,_train_de...
The government would certainly be complicit in this scenario, but is the corporation doing the act not still responsible for their actions? The corporation is still the actor that is motivated to do "the bad thing" (ie: cut safety features to save money), and then lobbies the complicit government to turn a blind eye. The phrasing of this seems to imply that corporations can do whatever they want as long as they play by the rules, and then puts the full blame on the government because they either failed to provide a "perfect" ruleset or they were actively complicit in turning a blind eye.
I know technically "doing whatever they want as long as they play by the rules" is in practice just following the letter of the law, but are they not responsible for taking some degree of responsibility beyond that?
Yes, but that is very unusual. It requires a lot of checks and balances to get past.
> This is a violence in my opinion.
Understood. We strongly disagree here, but it's interesting. I've never considered blocking an Adsense account to be in any way similar to being locked in jail for 20 years, for example, but I'll bear in mind that this is an opinion some people hold.
I think it's the concentration of power in just a handful of players that carries the similarity, they control what you can do (not unlike the state but through economic means instead of violence).
Being imprisoned is of course much worse than losing access to your Google Account but if you depend on having a Google/Amazon/Meta account for your work (let's say, as a small business owner selling online) it will be crippling to lose access to Adsense and Instagram/Facebook Ads while losing access on selling through Amazon Marketplace. In some markets you simply wouldn't be able to compete with others that haven't lost their access, you are essentially blocked from participating in the market. And those companies' processes don't have checks and balances like a functioning government provides.
Well - the state can do both of these, and does.
> In some markets you simply wouldn't be able to compete with others that haven't lost their access, you are essentially blocked from participating in the market
I partly agree. However, I think - say - Youtube Creator is a career with very limited potential outside of YouTube. But that's because YouTube pays really well compared to its competitors. If YouTube paid worse, then no one would rely on it as a revenue source. It's like spending your life servicing a rich person's Model T Ford. You might be well paid, but your alternatives are no better than mechanic in a garage. That's your choice, and your risk.
You didn't choose to participate in it, you were forced to due to the majority of your consumers being in that platform, you have no recourse, you have just been disappeared from business due to a private party's processes and decisions.
YouTube is another case to discuss but mostly through the eyes of market dominance, disappearance of the Open Web, and network effects. There simply isn't any other platform that can serve the market as YouTube does because of network effects. In that I usually end up in arguments about the Open Web vs this lunacy we currently experience where each platform is completely closed off and no interoperation is possible to really give a chance to competitors to raise. YouTube doesn't follow a common protocol that someone else could provide a product on and interoperate with YouTube, you either publish on YouTube or you simply cannot participate in that market. That's wrong, the web shouldn't have become that way but we allowed it.
We also don't put people in prison without explaining why. You have to earn it.
And there are plenty of examples of companies having and using violence. That in more civilized countries it happens less than before is because of the struggle of previous generations and not out of the good design of capitalism.
Mind you, I’ll take capitalism over any of the existing alternatives any day, but I think your view is very naive.
Lobbying is spending money to try and pursuade people with power to do something. That's not the same as having power. And lobbying is not a particularly capitalist mechanism. It's people talking to government.
The NRA, for example, hasn't kept politicians from meaningful gun control laws because they hired the most convincing lobbyists/conversationalists.
Counterpoint: arguably they have.
Sure, to first order, it isn't the same. But in practice they end up being very similar things and I think its a genuine issue with a system which justifies capitalism by saying "the excesses will be restrained by the state." In practice, capital spends quite a lot of time and money capturing and restraining the state.
I've come to feel that people are just fundamentally ungovernable at some deep level and so all solutions end up with glaring imperfections. We just have to ride the dragon of history, basically.
To be fair, under democracy, everyone must be doing this. That is your democratic obligation. Most people just don't. And fair enough that they don't – I value prioritizing putting a roof over my head and having food to eat too!
Perhaps the takeaway here is, ultimately, that capitalism and democracy are incompatible?
Only if the state cares to reign them in. If it doesn't, or joins up in cahoots with them...
For example, the Cuyaml Fruit Company's private army staging a coup d'etat against Honduras.
Or the Iraq Petroleum Company assisting the Sultan of Muscat's invasion of Oman because of the bountiful hydrocarbons in the area.
Or the Union Carbide India Limited pesticide plant in Bhopal accidentally poisoning 500,000 people.
Yes I agree a corrupt/incompetent state is the cause of almost infinite ills.
> Or the Union Carbide India Limited pesticide plant in Bhopal accidentally poisoning 500,000 people.
No form of resource allocation can prevent accidents. This is about the deliberate apportioning of power, not (horrible) accidents.
I'm not doing this. I'm at risk of repeating myself, but it's worse in government. And government gets free money from your wallet specifically to prevent corruption, and even define it. That's much worse than a company I can stop paying being corrupt. I have no voting power to remove a corrupt public servant, unless someone runs specifically on that platform. Which no one would.
Yeah, maybe you should also spend some time reading and trying to understand the arguments others provide. Instead you post dozen copies of the same argument.
EDIT:
To make it easier for you, the part you ignore when you keep saying "government bad, companies good" is that when the companies don't do the bad things, it is typically when the government stops them. Otherwise, companies are happy to do... anything that a government would do (except for holding elections).
That’s as an aside. Big companies trend towards authoritarian, communist style bureaucracy due to a desire to centralize decision making (or concentrate power). This is no more effective for a corporation than it is a government. Complexity theory shows us that all the interesting stuff happens on the edge of Chaos. Big companies suck because the desire for control kills the complexity dance.
Communism is where the means of production is owned by the people, and by that definition it's the opposite of authoritarian.
A "Communist state", meaning a state that is under control of the Communist Party, will claim a goal of working towards achieving post-scarcity, but there has been no such achievement to date.
Why then are we discussing an impossible situation? Why not discuss Magicism, where we imagine a world where magic has been discovered, and try to institute political systems right now that rely on this discovery being around the corner?
The only people discussing it are you and I, and we are discussing it because you brought it up. If you don't know why you wanted to talk about it, I guess the question is unanswerable.
Everyone else was quite explicitly talking about Communist states, which means we know that the topic was about states under rule by the Communist Party. That is not an impossible situation. That is a very real situation. But communism has no state. That is one of its defining features. We know that "Communist state" fundamentally cannot refer to communism.
> Why not discuss Magicism
Well, since you also brought it up, I guess we can. But there is no evidence I am aware of that indicates magic is a thing. I am not sure where you could go with it.
Post-scarcity is a thing. According to the UN we are already there when it comes to food. Shelter has been more elusive to get us all the way to "full" post-scarcity, with it still being approximately as difficult to build a house today as 200 years ago, but slow progress is being made. It is quite conceivable that some kind of technology could change the game there, as has already been done for food.
Yet, despite already having the technology to lift us from food scarcity, many people go hungry each day. Communists will blame that kind of mismatch on capitalists creating a situation of artificial scarcity. Cases like the Monsanto story, of which you are probably familiar, provide some justification to their perspective. They believe that socialism is the only way to overcome that hurdle in order to pave the way to post-scarcity. Theories can be off base, but one can at least understand where they are coming from.
Where do Magicists come from? What is the foundation of their theory?
That’s actually socialism, which some forms of communism see as a first step toward communism.
Communism is…fuzzier. It’s a state of voluntary, classless, non-hierarchical, self-government.
Companies certainly do "have violence" and certainly have locked people up in the past. The only thing keeping large corporations from doing this now is the state.
In the article, the author puts forth the problem with the Great Leap Forward: large central authority being disconnected from those starving workers. That's a problem large, centrally planned, corporations face.
This is not the whole truth. The problem with the Great Leap Forward was that the state enforced farming techniques, and even what farmers should work on instead of farming, and took food to bring to the centre. It's not just disconnection. Disconnection is far too vague a word to choose. To compare a company not listening to its workers with what the GLF did - it's hard to avoid thinking you picked the one vague word that could technically describe both of those scenarios, despite the vast gulf between them.
As I sort of said elsewhere - some companies are bad. That's fine, unless there's no competitor to move to. Then workers' situations are really bad, because they have to choose between retraining, moving, and staying, none of which is a great choice. But if you think that's bad, think how much worse it is that a state bureaucrat can lock you in jail, and your only option is to flee the country. Companies aren't perfect, but they limit the blast radius of the damage an incompetent or malicious employee can achieve.
Also, calling whatever economic model we have in our Western countries a "free market" is an oxymoron at best. There is no free market if politicians are allowed to force it to bend one way or the other with laws and trade restrictions.
Like many words put on slogans and coopted to drive some agenda, "capitalism" and "free market" have lost all their meaning. Anyone uses those words to refer to their favourite scapegoat.
But they can hire a private prosecutor to legally harass you and force you into house arrest for winning a case against them https://en.wikipedia.org/wiki/Steven_Donziger
It's silly to argue that Corporations don't have violence as a tool. In a literal sense, they might not be hiring thugs to break your legs, but with money comes many good lawyers who can tie you up in court for a decade, milking every bit of money(the thing you survive with) from you. This is a form of violence, an individual is defenseless against a large enough corporation that can basically spend 100x what you can on lawyers.
I don't see the point of calling things violence that aren't. Not everything bad is violence. And only the state is allowed to perform actual violence (non-defensive).
I think this is the common "Libertarian" view, that then goes down the Libertarian Rabbit Hole :
"That is Anarchy, wait no, we need some rules, guess we're back to having some type of government and/or corporation, back to the drawing board".
Humans keep re-inventing Moloch.
Sorry but this is plain out wrong. Under a capitalist system money IS power, as it is fundamental for survival, and that people with money are the ones that tend to have disproportionate amount of leverage both over the government and individuals. Under capitalism the government mostly exists to protect the interests of businesses and property holders, a lot more than say the common person on the street.
Capitalism says that companies don't get power. They need money to survive, but that doesn't mean money is power. Money is money.
> Under capitalism the government mostly exists to protect the interests of businesses and property holders
No, that's not right. That might sometimes happen, but it's in no way fundamental. Under capitalism the government sets and enforces the rules, and provides currency and other bits and bobs to let people trade fairly and at a minimum standard.
Quite the opposite - companies literally set rules all the time. How the work should be done, who should do what, who the boss is, when are you allowed to leave, etc.
Being obliged to be in an office is tantamount to being locked in a box for a considerable amount of your time - and you don't get to choose which part, so you end up spending the vast majority of your precious time locked in a box working for someone, because otherwise, and here we come to the last part:
Companies have the power to ruin livelihoods, cause homelessness and death, etc.
The government of capitalist countries creates that system, and has done so historically, so that the system above is upheld. And the government works mostly in favour of businesses and business owners as a whole, because it is made of said people. You are obliged to go to work for someone else or face starvation, exactly because this is a choice that was made and continues to be made by governments in favour of businesses. You are obliged to pay exorbitant amount of money to afford basic necessities. etc. etc.
> but that doesn't mean money is power. Money is money.
Exactly the opposite - money is pure power. Money is literally congealed social relationships. With little money you can't do much. With a lot of money, you go golfing with senators and lawmakers like I go for Friday beers with my mates. With a little money you're forced to continue working that deadend job to make ends meet. With a lot of money you can have a yacht bigger than the house of the person in the previous sentence (oh, wait, that person doesn't actually own the house)
Yeah that's why if you try to leave google, a bunch of guys show up with baseball bats and crush your knees to pulp.
This is normal and natural. In a corporation, some stakeholders contribute cash, and other stakeholders contribute labor. Both are forms of capital. It is the combination of both that allows them to become more than the sum of their parts, and in doing so, generate wealth. There's plenty of room for criticism about just how much of the generated wealth should flow to those who invested cash compared to those who invested labor, and reforming the tax code so that it is easier to compensate with shareholdership those who invest with labor. But corporations should earn more from the labor than the labor is worth. That forming a corporation begins a positive-sum game, and not a zero-sum game, shouldn't be controversial.
> I know the solution is not more freelancing and contract work, which America’s corporations are addicted to. That’s the worst of both worlds: The exploitative nature of capitalism with the inefficient bureaucracies of communism. Transactions on the free market work because they’re good for both sides, but most people only accept part-time contract relationships today when they have no other real choices.
I think the author is holding up very specific contractual relationships as a scapegoat here; e.g. "gig economy" work a la Uber drivers, or the "contractors" who are fleecing the state of California out of billions of dollars for the high-speed rail project. And fair enough. But buried in both of those scapegoats is a clue: the "solution" is not individuals accepting take-it-or-leave-it short contracts presented by a robot taskmaster, nor is it BigConsulting agglomerating tens of thousands of warm bodies sold out by the hour, any more than the solution is sole proprietorships sewing dresses in their living rooms or the massive bureaucracies of Fortune 100 companies. Rather, it is in small and medium businesses, and giving contracts to other small and medium businesses; every one running small enough to keep executives in touch with line workers.
Don't grow headcount further than (Dunbar's number - friends and family =) 100. If you feel tempted to do so, see what you can spin off and become their initial primary customer. Look to the Mittelstand as a model.
It's frustrating to see so many thinkpieces keep basing themselves upon the Labour Theory of Value, while it has been long debunked.
To use a stretched analogy, it's like a blog on vaccines basing themselves off Andrew Wakefield's work. It should not be taken seriously.
> The labor theory of value leads to obvious problems theoretically and in practice. One critique is that it is possible to expend a large quantity of labor time on producing a good that ends up having little or no value. However, a closer reading points to the fact that commodities conforming to the LTV would have both a use-value and an exchange-value, and be reproduceable. Therefore something that has no demand in the market or with little or no use-value would not be considered a commodity according to the LTV. The same would go for a unique object such as a work of fine art, which would too be excluded. It may take one person longer than another to produce some commodity. Marx's concept of socially necessary labor time does also get around this problem.
> A second critique is that goods that require the same amount of labor time to produce often have widely different market prices on a regular basis. Moreover, the observed relative prices of goods fluctuate greatly over time, regardless of the amount of labor time expended upon their production, and often do not maintain or tend toward any stable ratio (or natural price). According to the labor theory of value, this should be impossible, yet it is an easily observed, daily norm.
Source: https://www.investopedia.com/terms/l/labor-theory-of-value.a...
This critique mixes the concepts of "individual value", "social value" and "price". These are entirely different things for Marx, but the comment acts as if they are the same thing. If you take too much time and effort creating something, the individual value created is wasted because the basis for exchange in society is the social value, based on the time and effort socially needed to create the item given the current technology and social organization. This is a very naive critique, answered on the first chapters of Das Kapital. Moreover, unique items can have a price, even if they do not have value (the honesty of a corrupted cop have a price if he accepts bribes, but has no value).
> A second critique is that goods that require the same amount of labor time to produce often have widely different market prices on a regular basis. Moreover, the observed relative prices of goods fluctuate greatly over time, regardless of the amount of labor time expended upon their production, and often do not maintain or tend toward any stable ratio (or natural price). According to the labor theory of value, this should be impossible, yet it is an easily observed, daily norm.
This critique is valid only for naive labor theory of value. Marx spent most of third volume in Das Kapital talking about this, and agreeing that the prices are not equal the value: these two things would be equal only if the capitalist economy was composed just by a single industry, or if the composition of different types of capital were the same for all industries. In a complex economy, with many different industries, the competition between capitalists and their search for profits causes some products to be sold below their value and others above it, as a consequence of the tendency to equalize profit rates that this competition generates. This paragraph criticizes the naive LTV from Smith and Ricardo, but not the Marxist one.
The closest thing I'm aware of to a free market was the cryptocurrency driven markets of the "Dark Web" somewhere between the rise and fall of Silk Road. Yet even that market was embedded within, and ultimately governed by, the jurisdictions the network was hosted.
What is so free about a central bank setting interest rates?
https://en.wikipedia.org/wiki/Social_market_economy
There are different types of communism, based on what that means. i.e. Leninists would generally believe that the state is representative of the people, via dictatorship of the proletariat and all that. Whereas council communists would have none of that and would prefer no state and councils of producers and consumers, and once you start digging into anarchism, you will find a bunch more other varieties of communism.
Words are meant to communicate things, if they aren't communicating your intent then why even bother using them? While they still have some vague relevance from a historical perspective, like when discussing the cold war, I think any contemporary discussion where one feels the use of these words might be necessary would be better off just listing their ideals directly instead of falling into this semantic trap.
What's worse is that people will assign a meaning to those terms, not bother to tell anyone that meaning, and yet use the term in discourse with others who they know don't assign the same meaning. It's infuriating.
What everybody really thinks is "people should be free to do good or trivially bad things, and shouldn't be free to do materially bad things".
That is also socialism. Communism is an imagining of what the world will look like after entering a state of post-scarcity. In fact, part of what is imagined in that is that we will become stateless. After all, absent of scarcity, what would you need a state for?
Now, it was once theorized that capitalists would artificially withhold entrance into post-scarcity and that the only way to achieve post-scarcity is, first, for the state to take over the means of production. This theory bred the Communist Party. States under rule of the Communist Party are often called Communist, but in that vein does not refer to capital ownership, but rather the party in power.
If you see socialism as only some kind of state where capitalism no longer exists, then sure, we've never gotten there. Probably never will. Hell, even if post-scarcity communism is someday realized, it is equally possible that we got there by way of capitalism. Just because someone theorized that capitalists would put up roadblocks on the way to post-scarcity doesn't necessarily mean they would or that they couldn't be overcome.
""... but most people only accept part-time contract relationships today when they have no other real choices.""
Great to point out.
Free-Market would require people to be free. But if you work for the company in the company town, you're not free.
> One of the core principles of the free market is that central planning committees can never be as efficient or as effective as the people doing the work. By definition a free market economy lacks a decision-making hierarchy; the ‘free’ means every agent (individual or corporation) can decide for themselves, without needing permission from a manager above.
> ...
> It should be immediately obvious why this fails miserably: The distance between the central planning committee and the farmer is so great that good decisions are nearly impossible. It’s nearly impossible for critical feedback to make it from the edge, where the farmers are working, to the central planning committee in time to affect decisions, and then for those decisions to make it back to the edge in time to be useful.
One of the core arguments for using a centralized control plane (versus a distributed one) is the ability to perform a single global optimization, which can yield better results compared to local optimizations. I find it interesting that the free market principles dictate the opposing conclusion that this global optimization is infeasible, although it may come down to my next point:
If you're not careful, and your centralized system injects dozens of minutes of delay due to the additional complexity of performing the global optimization, you end up with the globally optimal decision from 20 minutes ago, which in the context of, say, load balancing is an eternity. Or in the bureaucracy of government (or hardware planning cycles, etc), you may see months to years of lag between the inputs your model accepts, and the outputs your model produces. And all the while, you have a full pipeline of decisions coming down the line, based on stale data.
(There are other reasons for centralized control, such as orchestration of distributed computation being difficult to do correctly, and it being easier to reason about a single node rather than the complex system-wide interactions.)
So it's a question of organising big systems and how best to do that. Nothing says that we can't have organisations structured around this decentralised decision making, and quite the opposite - we both have the evidence this works, and it has been so thoroughly studied there are tons upon tons of pages written going back all the way to the 20s ...
It’s also partly because a distributed system can factor into its decision-making a vast amount of information, as where humans may not have sufficient understanding of all areas (and again, decisions are not algorithmically optimizable) to make the proper decision. As where more knowledge can help an algorithmic decision-making process, it can overwhelm a human one.
That said, computer systems are similarly prone to inaccuracy. Perhaps not to the same extent as human organizations, but they have similar propensity to fail spectacularly. If you fail to model certain characteristics of the system (or model them poorly), then you can end up in a situation where your load balancer is causing significant congestion and not thinking anything is wrong. Or your hardware planning pipeline thinks that it has lots of spare capacity even though you're overflowing every day at peak. Or your central planning committee for the government thinks you have lots of excess grain production when that's simply not the case in reality.
(Algorithm implementations can also be outright buggy.)
Another way your model can fail is if you treat resources as infinitely fungible. Suppose you have enough food in Shanghai to feed two billion people, but no food anywhere else in China. Without an adequate transportation / distribution network, everyone outside Shanghai is going to starve, and all the excess food in Shanghai is going to rot. Similarly, your servers in California aren't going to do very much for users in India if you don't have the infrastructure to actually serve that long-haul traffic.
Another point that I didn't bring up, but related to your point about global vs local decision makers, is that centralized systems have much larger blast radius. In the case of China during the Great Leap Forward (one of the examples from the article), bad decisions led to famine across the entire country. In the case of a global load balancer, you can break your service globally.
That actually doesn't seem avoidable, because some of this time will need to be spent identifying risk and malice/corruption.
The answer to that one is unionization.
Unfortunately, unions are rather looked down upon in tech, for fears that "high performers" would not be able to set themselves apart financially from "low performers". And as a result, everyone loses out.
> That brings up an even bigger problem - companies today hire workers to make money from their labor. In other words, they generate profit because they pay their employees less than they’re worth. If everyone could trade their labor for exactly the amount of money it was worth, the corporations that employ them would have a much harder time making money.
Anyone else see an issue with this comment? We don’t know how to value the work of a corporate employee but we’re simultaneously all being paid less than we’re worth.
I like this article but I do feel the author leans too much into theory and what I hope is hyperbole. What I do love though is the admission at the end that we’re in a tough spot with modern capitalism and there’s no easy way to fix things by some “just do xyz” solution.
How many times to do talk about the sales guy that earns too much, or so-and-so, that got promoted for being nice. Everyone is always complaining about others getting paid more, and that wouldn't happen if the pay was equal to value.
Or, how about in Software, there are a lot of teams adding features, which one was worth more? It is hard to tell, but everyone seems to agree the guys at the top didn't contribute much. So, it seems like the math would work, the guys at the top don't produce much value, but get more money than the teams adding value. Even if how to calculate each individual value is difficult.
We can have essentially no idea what each contribution to the whole is worth while being certain that the whole must, over the long term, be less than value X.
Comparatives overriding superlatives aside, I don't necessarily see these two issues as at odds with each other. We are bad at assigning dollar amounts to units of work, or even the productive output of a specific individual, but in aggregate companies can know how much revenue they bring in, and how much they spend (on labor, among other things), and in order to be profitable, revenue must exceed costs by definition.
So taken in aggregate, companies are still able to exploit the gap between cost and value of labor. A highly productive individual might be significantly underpaid, but on the flip side, a less productive individual might be overpaid at the same company.
Think of it as a general rule of thumb, a statistical average. You will for example find that often managers and executives make a crazy amount of money, but are all but useless, but are only a small part of the bigger company.
Should each owner run around and tell each employee globally how to do their job, what is the goal, budget, restrictions, rules, timelines etc? This is a massive vacuum that needs to be filled, and managers fill it. Some better, some worse, just like any other profession.
Generally weird article to be polite, probably put together in a haste to give benefit of a doubt to the author.
One problem is that the amount of "vacuum" that needs to be filled is often also decided by the managers, and many of them start creating work for themselves. Suddenly every team and every project needs to have a separate Jira and Confluence instance, there are meetings every day but most of the meeting is just reviewing the same information you have reviewed yesterday, etc. And the budgets, yeah, with so many managers there is hardly any money left to hire anyone else.
Of course not, but there are many useful ways to organise this. Hell you can still have managers, but make them elected from the body of workers. It's more that because of the first thing you said (with which I agree) these managers are basically cops or wardens.
They are all but useless, sure, but much, much more valuable people as they hold a scarce property that nobody else working for the company has: Trust. Value is defined by the relative scarcity of something desired.
A number of people do work and create wealth, and then every quarter a dividend is sent off to some heir. "Being paid less than we're worth" as you characterize it. There are people who work, and heirs who parasitically expropriate surplus labor time from those of us who work. Workers work and create wealth, and then whatever remains of that after external expenses is divided into wages for the people who did the work and created the wealth, and the heir who does not work expropriating their profit. This is the being paid less than they are worth part - if the heir was not sent their dividends, the workers who created the wealth would not send off those dividends and that portion of the division would go to wages as opposed to dividends.
That they don't know how to value the work of a corporate employee doesn't trouble me in regards to the just mentioned fact.
If two workers create $240 of wealth in a day, and $60 is sent off as a dividend, and the one who worked 8 hours made $120 in wages, and the one who worked 6 hours makes $60 in wages - then there are methods that might approximate their actual work. One would be to take the $60 going to the heir and give $20 more to who worked 4 hours and $40 more to who worked 8 hours.
I think we can get to this answer by looking at a couple of questions from an accountant's perspective. The first: Where does profit come from? Somewhere there must be an arbitrage. Next question: Why isn't that arbitrage competed away? Further to the point, there must be some universal arbitrage available to all industries to create "profit" in every single case. There are very few commodities that are universal across industries, such as electricity, land, and workers. Because of the universality of profit (or else all businesses would not exist long term), some universal input would be a prime candidate for a source of such universal arbitrage.
The next step is to think about Commoditize Your Complement [0]. Given that selling work is a universalized commodity, and sheer numbers of workers competes away all profits, what is the complementing field? Employment. Employers monopolize Work to extract the value away from their complement; workers. With being a commoditized complement brings with it the cutthroat competition just to keep the lights on, while value floats to all the businesses in the complement.
However none of this is permanent in the Macro. During boom times all boats float. All firms hire from the same pool of workers, driving available workers down and prices/wages up. This drives employers into the arms of productivity machines to control the spiraling costs of labor. This is a trap. While you might gain productivity, it shifts more of your investment away from the Universal Arbitrage (workers) towards productivity machines, thus becoming the commoditized complement of the makers of productivity machines.
Finally, I want to point out that these are general forces and not destiny. Also Reality is fuzzy, and none of this addresses stuff like Bailouts and other extra-economic interventions. Just because something is profitless in the long term does not mean it can't be profitable to you in the short-to-medium.
[0]: https://gwern.net/complement
The work of János Kornai made us realize that it is impossible to find an exact solution for economic planning, so a completely centrally planned economy is destined to have major inefficiencies (he was also a notable inspiration for the Chinese reformers). It also seems like some kind of planning is inevitable in market economies to achieve long term goals as market prioritizes short term gains.
That sounds like it's a gotcha, but it just isn't. Markets is about limiting the blast radius of bad dictatorships WAY DOWN. That's also why big corporations should be something that scares everyone. Maybe this isn't what the theoreticians think it's about, but that just makes the theory wrong, not the system.
> Millions starved during the Great Leap Forward because the central organization was trying something impossible: Managing the productive output of an entire country.
That's just one part of the problem and not even the biggest.
They also:
- moved all big farms from the "capitalists" who knew how to run them to random people who didn't (this has been done in several countries without planned economies and the disaster was just as big)
- decided to kill all birds in the fields because they thought they ate the grain (they ate the insects that ate the grains)
- ordered planting too close because of political ideas (even though the Soviet experts told them not to do this since the USSR had already tried this and had famines to prove it)...
on and on it goes... In short the central planning is just the tip of the iceberg of Chinese communist mismanagement.
> today’s most vaunted tech leader, Steve Jobs, was famously disrespectful of the opinions of others, yet made a lot of world-changing decisions
Not even close. He didn't accept people opinions and he didn't ignore them politely: he challenged them. If you convinced him he changed his mind super fast. "Strong opinions, loosely held".
This is what actually respecting others opinion looks like. It's just that most of us has never existed in a social situation where respect for opinions/ideas exists. We life in a world of pseudo-respect where we basically nod when people talk and ignore them.
We hate working for or with i. assholes, ii. pointless endeavors, and iii. unreasonable boundaries imposed on our autonomy and pride of work.
See also:
RSA ANIMATE: Drive: The surprising truth about what motivates us (2010)
https://youtu.be/u6XAPnuFjJc
1) Big companies have an enormous amount of friction and hassle that must be overcome to get things done. This is by necessity -- workers have to be coordinated with each other, and the more of them there are, the more overhead is required to accomplish that.
2) Big companies are boring to work for. Even when they're doing interesting things in the big picture, you're not likely to be working on the interesting bits. And when you are, it will be done in a way that makes it as tedious as possible.
I know many people with sensibilities similar to mine. I also know many people who strongly prefer to work for big companies. Big companies are just a different sort of beast, and if you enjoy riding it then more power to you. It's just not for everyone.
This mostly has to do with top-down control and trust and should you get to do what you want to do because it’s maybe probably locally optimal but you didn’t notice the 5 semi trailers that will crush you on your current trajectory.
Your last two sentences are fair enough, but perhaps this adds some context.
It would be interesting to run a company like it’s the free market, where you give out money based off how effective the individual parts of it are. But that’s basically done already, the issue is that work done by humans is not quantifiable and comparable at scale.
Hopefully LLMs when given the reasoning upgrade can perfectly measure all of our contributions and then we can get rid of the central planning group (since they’re so costly) and replace it with some AI
If the company as a whole can buy human work per hour, perhaps so could the intra-company free market.
Imagine a company that hires people for "minimum wage + bonus". Internally, the company consists of projects; each of them can 'hire' any willing employee currently not assigned on a project; and if an employee is not 'hired' by any project for 6 months in a row, the employee gets fired by the company.
Maybe even more interesting would be a system where for each N months worked on a project you gain 1 month outside projects, and if you accumulate enough such months, you could try starting a new project within the company.
Otherwise: we(humans)'ll just become automotons without any meaning to live