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Comment by adrianratnapala | Hacker News Reader

Well the article's fundamental worry is right: labour's share of revenue has shrunk compared to the share taken by capital (and also high-level executive type employees). And this causes, or is at least related to, problems with society as a whole.

But he makes no real case that buybacks are driving this. So if some politician wanted to go on a populist anti-buyback campaign, this article would be useful to him. But as an attempt to actually address the problems it highlights, it looks more like a distraction.

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"labour's share of revenue has shrunk compared to the share taken by capital (and also high-level executive type employees). And this causes, or is at least related to, problems with society as a whole."

In America possibly.

But remember the missing part from this piece: globalism.

These are not 'American' companies anymore. They are global. Often with considerable ownership from overseas - and employment.

So - while the American lower-middle-class has not been doing as well - India, China, and big chunks of the developing world have been growing gangbusters.

They're all hiring in India.

For every middle-class American in stagnation, there's 2 Asians and 1 South American who are 'on the up'.

I'm not saying it's better, or needs to be this way, or making any kind of moral argument, rather just pointing out that most companies post-2000 simply can't be spoken of entirely in the American context anymore - and the story looks different when you look at it more from a globalist perspective.

Actually, both capital and labour shares of output have seen a relative decline at the expense of profits. [1]

Conventional theory suggests this would occur under conditions of increasing market power. Most of the symptoms of this (of which decreasing investment is one) can already be witnessed. [2]

It seems therefore that the increase in share buybacks is simply one of the symptoms of the overarching market concentration narrative. Monopolists have little need to invest/innovate due to lack of competition and are therefore free to commit resources to price manipulation or further increasing their market power.

In this context any anti-buyback campaign would prove ineffective unless carried out alongside policies designed to limit market concentration and increase competition.

[1] https://promarket.org/responsible-declining-labor-share-outp...

[2] http://noahpinionblog.blogspot.co.uk/2017/08/the-market-powe...

Actually, both capital and labour shares of output have seen a relative decline at the expense of profits. [1]

What am I missing here. I thought "profit" simply was a shorthand for "captial's share of revenue". I tried to understand the definitions at the promarket.org link but couldn't make sense of them.

I think what you are saying is that profits are being increasingly being derived by barriers to entry. That makes sense, but still those extra profits are going to be counted as captal's share of revenue.

Profit is the surplus. How that's paid out (investors, labor, government, management/execs, etc) is another matter.

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