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Comment by ck2 | Hacker News Reader

If you think about it, the more money you have, it means you've extracted money from more people.

More wealth means you've taken more from more people.

It also means you didn't have to take quite that much but that is a different argument.

I also laugh at how people think we won't have to work someday because robots and automation. Who do you think is going to own all those extremely expensive robots? People with the most money who've taken it from the most people. Certainly not the average person. Now where are you going to get your money?

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Do you view all the transactions you've made in your life as taking things from people?

So in your mind you've been swindling people your whole life.

That's pretty awful.

Or they're taking from you. Or by some freak accident, you exchange things worth the exact same.

If someone sells something to me and makes profit, that means it could have been sold to me for less, and they are pocketing the difference. So they are exploiting the fact that I value the thing they are offering at more than it is actually worth to make profit.

All profit is this way. Small profits are tolerable, large profits usually have the adjective 'obscene' attached to them because they are inherently exploitative.

To make large profits you must either rip off your employees by underpaying them, rip off your customers by overcharging them, or some combination of the two. See, for example, Apple. Enormous profits, how? Exploiting factory workers in sweatshops. Criminally conspiring to drive down tech workers' wages. Combined with overcharging for every product.

You're wrong in a very sad way.

When you buy something, it's because you value it more than the money you pay for it.

When you sell something to somebody, it's because you value it less than the money you get for it.

Win-win!

And, channeling Carlin: Everybody making less money than you is a loser, everybody making more money than you is an asshole.

That's the zero sum theory. Fortunately, it's false, and easily shown to be false. If a famous artist sits down and paints a picture, he creates wealth. It is not taken from anyone.

Is this actually true if, instead of saying the context is an artist in a room, the context is an artist on planet earth? A man has to eat, where did that energy come from? It definitely wasn't free, popped out of thin air. I'd say until we have a much more advanced handle on the application of physics, wealth is taken from others (and I'm not saying that's wrong persay, it's impossible currently to have it any other way).

Having said that, it's all too easy to find instances of wealth 'created' on the backs of other people, or on the back of natural resources that will run out. I've seen way too many people with college educations get taken advantage of, fresh out of school, just because the employer could. Why not?

Your musing poses an interesting question. But I'm writing just against the bit where you say we should default to accepting the zero-sum perspective given a lack of understanding of physics.

The evidence against the zero-sum perspective of wealth is overwhelming.

You can go and harvest the wheat. Or, you can let the wheat rot, and spend your day digging a hole and filling it in. Same energy spent. One creates value, the other doesn't.

You can light the gas under your stove, or you can set your curtains on fire. One destroys value at speed, the other doesn't.

You can sew something with a needle and thread. Or you can use a hand-wound sewing machine you inherited from a relative. Same outcome, one is far more energy-expensive than the other.

Indeed. This is the essential difference between capitalism and corporatism (sometimes called crony capitalism). Corporatism is insidious. It enables established players to control markets by manipulating regulations through political favors and disabling competitors through predatory positioning or pricing. It's very unfortunate that many people (including myself in the past) throw out the entire history of prosperity building that capitalism has enabled by conflating it with corporatism. Much of the sentiment driving the distaste for disruptive innovation thinking it will cause a race to the bottom directly supports incumbent large corporations and corporatism. It's easy to fall prey to this, because the narrative can easily have compelling stories of the human harm caused by technical innovation.

IMHO this corporatism thing is just 'No true scotsman' for capitalism. If the right is able to do that, then the left should be allowed to get back talking about communism and socialism again, since none of the problems that happened were in the original thing thought. Also, no true scotsman is too a compelling narrative. I mean, I'm not here to bash you, but since I started looking into this topics more closely, this type of argument doesn't seem much coherent anymore, without state intervention 'the system' would have crumbled a long time ago. IDK it just sounds like ideology.

Slavery, colonization and wars enabled a lot of prosperity building too, and also a lot of technological innovation.

Right - there's a tendency to see bad things that are done in crony capitalism, and then - in reaction to that - to entrench at the zero-sum fallacy.

I'm interested in this topic - what to do about corporations. Something I think about: if we don't have corporations what replaces them? How do you implement business that require commitments that are larger than family?

For example. Consider a digital social network that was oriented around commercial arrangements. You could form complex contracts in a group, and produce a reputation system formed from sets of people. There would be a deposit system, and an opt-in judiciary for dispute resolution. Could this - a digital upgrade of the icelandic commonwealth - be a more powerful mechanism than The Corporation?

There's a big difficulty in wanting to get rid of corporations, and that is that they emerged from a process of true evolution. The Dutch and then English East-India companies allowed humans to do things that had just not been viable previously. In fact, they were so successful that they could have obsoleted nation states. Certainly the East India company could have, and was reined in only because its shareholders and employees continued to show deference to the crown. Nation-states got scared at that point, and imposed significant political controls - corporations are not allowed to maintain standing armies. So I think it's important to appreciate what powerful tools they are. Any discussion about getting rid of them needs to consider - how do you implement large-scale projects in a hypothetical world without corporations?

Well, I'm not really against corporations per se. I work for one I quite enjoy and whose aims I think are good and in the general interest.

The challenge, as I see it, is to have governments with a spine, but governments not so big that they stifle freedom or crowd out opportunities. Governments need to be powerful enough to overrule the biggest corporations so that corporations can exist without the cronyism. Power alone is insufficient though because even a powerful government is peopled by individuals who can sometimes be bought cheaply.

The East India Company is a somewhat terrifying example of what is possible with unbound power for corporations. It's an equally bad and unsubtle endpoint as an all government central economy. Diversity of thought and composition, as in many places, yields better results than homogeneity.

I think corporations are necessary for large-scale, long-term commercial endeavours. Certain classes of services to both individuals and businesses need continuity and corporations are well-suited to providing that kind of continuity.

Where we are today forgives incumbent large corporations too much and (certainly in Canada) makes it far too difficult for entrepreneurs to start small businesses.

but both actions require energy. in one case value was created in the other case no value was created.

there is no case where value is created and no energy was spent.

thus wealth is limited by energy.

Yes, it is free and it comes from the sun. It provides our fuel and thereby our operating temperature (37 degrees C) that gets us up in the morning to do things and create value (wealth/profit) that can very often be transferred via money to and from other wealth creators. And that means all of us on Earth. The earth is so productive that we can afford to trade value residing in abstract forms as in the arts, caring professions and the bureaucracies (government).

Natural resources don't run out. The quantity of elements on earth has and will remain the same for a few billion years. Application of energy and information permits inter-conversion of their combined forms as we wish, if we're smart enough. Not a given, I admit.

The creation of global wealth over the last 20-30 years has brought millions out of poverty. This is unprecedented. And it hasn't been wealth taken from others.

if you consider the sun to be an unlimited source of energy ( which technically speaking it is not) then energy is still limited. it is limited by the amount of light we receive and our technological ability to extract energy from said light.

our technological ability to extract power from the sun is so limited we are forced to mine the earth to extract solar energy from the past (aka oil).

natural resources do run out. they are frequently converted into forms that are unuseable. in the rare event that a natural resource can be converted back to a usable form (recycling) we must further tax our energy reservoirs to perform such feat.

the wealth that was taken from the earth was not taken from anyone you know now. Perhaps your great great great grandchildren will live in a society where oil is more expensive then gold.

However even when we remove all the factors I describe above there is still wealth 'theft' taking place in our society right now. The issue is that some forms of wealth need to be extracted by many people working together. when you have these creatures called billionaires that own wealth they in no way produced all by themselves you know that wealth among these collaberative groups was distributed unevenly. This is known as wealth inequality and it happens as a direct result of extracting wealth from other humans.

Out of poverty and into what? Remember, poverty is man-made. From where I'm looking, 3 billion+ pairs of eye are staring back at me from poverty, that too is unprecedented.

You say natural resources don't run out, how about clean air and clean water? Species diversity?

Poverty is not man-made, it's what happens when wealth is not produced. Wealth is man-made. Do you suppose cavemen were wealthy by our standards? If not, was their poverty man-made then?

the wealth a single man produces is bounded by physical law and physical limits. Even for an artist to make an abstraction such as a painting the artist needs to use material and energy both which are part of a zero sum game.

when said artist accumulates 1 billion dollars worth of wealth did that mean he painted 1 billion dollars worth of paintings? Did the billionaires of the modern world single handedly each create a billion dollars worth of wealth?

take a 747 airliner. a product worth less than a billion dollars in value. such a product must be built by multitudes of people because projects of such immense complexity require man hours that exceed several life times. If billionaires exist it implies that the billionaire built several products of equivalent value and complexity all by himself.

for a single man to hold such extraordinary wealth of absurd proportions means one thing and one thing only. He built his wealth off the backs of others.

> the wealth a single man produces is bounded by physical law and physical limits.

Not at all. There are no bounds to the value of a painting, for example. None of that is wrapped up in the value of the paints and canvas, which is easily demonstrated by my using those same paints and canvas to paint a picture, and I'd have to pay to dispose of the result.

That's true. The value of a painting is the painting in and of itself.

You can have a piece of a paper with "$1B" written on it, but that's meaningless in world where the painting is the only wealth.

You are talking about a lower bound. I can create a painting with a value equivalent to trash. I can take energy and throw it in the dumpster. This energy is wasted and therefore worthless. This is common sense.

But can I create a painting of infinite value? In the history of mankind... has there been an object of such immense value that society has deemed the object worth more than the value of all the lives of humans that have ever existed? No. By virtue of common sense no such product has existed. If no such product has existed then likely there must be a hard physical upper limit to value.

However, this example only hints at a fuzzy description of an upper bound to value. It is not clear what this upper bound exactly is... because a human can use his imagination and say that a piece of paper is worth 2 billion dollars. If human thought has no limits and if human thought determines the value of all things, why don't there exist objects that are worth 2 google gabillion dollars?

Let us develop a concrete definition for value with our first example: the painting. Also let us examine this painting in the hypothetical context of an island bartering economy of two economic actors: a painter and a potato farmer.

The farmer creates products of concrete physical value: food. Food is a product made of energy extracted from the earth and the sun. The painter makes products of abstraction, a painting: an object supposedly worth more than the sum of its parts.

Let's throw this economic simulation in motion. What is the maximum value of a painting produced by the artist? Can the potato farmer say that the painting is worth 10 trillion potatoes when his maximum potato production rate is 2 per day? No. This is impossible. No 10 trillion potato-painting transaction can take place in this economy because the amount of potatoes is limited to 20 per day. Thus in an economy of a farmer and artist the value of the painting is bounded by the total potatoes the farmer can produce.

Lets look at the absurd example of an economy with two economic actors of two painters. Both painters produce a painting and they both trade each other paintings. Then they starve to death because there are no potatoes to eat in the economy. This absurd example illustrates one thing: All economies cannot be made up of solely abstract products of overblown value. All economies must have concrete physical primitives like food an energy to function correctly otherwise people will starve or nothing can happen. An economy of pure abstraction is an economy made of hopes, dreams and imagination, such an economy cannot exist in reality.

So in conclusion what does this mean? It means two things:

1. All economies must have concrete physical products to function. Economies cannot be made up of only abstract paintings, poems and stories.

2. All abstract products within an economy are bounded by how much it can be paid for by the total amount of physical product in an economy.

Thus the conclusion is inescapable. THE VALUE OF ALL PRODUCTS PAINTINGS OR ANYTHING are bounded by PHYSICAL LAW and PHYSICAL LIMITS.

The notion that value is an ephemeral imaginative thing is an illusion. This makes sense in the context of the universe.

The common response to this is: Universal Basic Income.

You mean guaranteed minimum housing cost.

Or guaranteed minimum landlord profit.

Because rent will rise by exactly whatever guaranteed minimum income becomes.

Same way college costs rise to whatever loans are available.

"Because rent will rise by exactly whatever guaranteed minimum income becomes."

That seems unlikely, because of competition. Not merely of identical units, but of all alternatives. We are not terribly supply-constrained on housing, nationally or globally (some markets certainly are, actually or artificially).

"Same way college costs rise to whatever loans are available."

Money that is available only to a single purpose is a substantially different dynamic than money that can be put to other uses.

Most cities have housing restrictions. Since this will most likely never change, rent will go up accordingly.

Competition of all alternatives. As I said, this is not merely identical units.

It includes those cities which do not have housing restrictions. It includes any new units permitted inside existing housing restrictions. It includes increased sharing of housing (this is also impacted by other forms of "housing restrictions" but most people live in situations below maximum occupancy). It includes moving outside of cities entirely (made more attractive in the presence of a basic income).

To the extent that people choose these alternatives, rents will face downward pressure. They may still go up, but "the entirety of BI will simply become rent" seems wrong.

A truly universal basic income would probably allow a diaspora from the currently over-saturated, "the rent is too damn high" markets, into the surplus housing stock and land that sits vacant due to poor local economies throughout the country.

If I could earn a guaranteed $25k for breathing, I sure as hell wouldn't be where I am now, since I could go home and buy a good chunk of land, do some subsistence farming, and happily hack away and read at my leisure.

That's a good rebuttal, however you seem to ignore the innovating spirit of humans. Why should we live where rents are high? Not sure if you are in America, but we have lots of land and many places it is cheap. If UBI is indeed universal, we are not tied to the markets that are cornered.

Secondly, if we go that far why not push for more public housing as well (can do it in a failing city like Michigan or build a new city) and let people create their own economies?

> Why should we live where rents are high?

I don't know, I ask that every time I drive down the road in Silicon Valley.

I thought about it. Where did the people that I extracted the money from extract the money from that I extracted?

the sun and the earth are the root of all wealth. Both are limited resources.

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