I'm an average software developer in the USA. Would you please provide some examples of how my wealth is being redistributed to the already wealthy?
When the inevitable blowup happens (like in 2008), then these people keep their bonuses of tens or hundreds of millions of dollars while the losses are socialized, which means you're on the hook and your tax money is used to bail out "too big to fail" banks, insurance companies and auto companies.
10 years later people are still talking about a "recovery".
The money supply has been diluted via money printing (so-called "quantitative easing") which is still being done in EU and Japan on a massive scale.
The already wealthy are positioned much closer to the money spigots (by being able to get money at much lower interest rates), and can therefore do "carry-trades". Basically a license to print money.
Money printing and interest rates kept at an artificially low rate deprives from savers and pensioners of income they would otherwise have.
Think of it this way, if there was two hundred of you all working together, would he still be adding more value than you?
Put it this way:
- Would you feel comfortable investing your money with a company run by 200 engineers?
- Would you feel comfortable entering into a contract or purchasing agreement with a company run by 200 engineers?
Its totally not because the 1% has captured all the value created by increased productivity over the past 50 years. Definitely not.
What exactly do you think separates companies like Oracle and Microsoft? Oracle has hundreds of very talented engineers. But their position in the market is stagnating.
This is hard for HN types to accept, but Engineers are not the people in software companies producing value. No individual person is producing value. Its a combination of the leadership who can lay down a plan toward something that produces value, and the line workers who can actually produce it. Both are necessary.
Here's the difference: If you need to replace an engineer, go for it. Who cares. There are millions of us. We're code-monkeys. If you need to replace a CEO, you better be careful. Github couldn't even find a good CEO, so they sold out. If you're not careful, you might get a Larry Ellison or a Marissa Meyer instead of a Satya Nadella or a Tim Cook.
Successfully leading companies legitimately requires personality characteristics that are present in less than 1% of the population. I would guarantee that if we dissected the brains of enough C-suite people from successful companies, we'd see some sort of genetic or brain matter similarities, probably something resembling sociopathism.
As a lower-level employee, sometimes you think that the company would be successful without a leader, or even is successful in spite of poor leadership - while that may sometimes be true, much of what happens at that level is hard to understand unless you've been there
Here are some examples: I've worked in the gaming industry at big company for 5 years. I've seen a ton of games fail and few succeed. I was on the most successful game team that made hundreds of millions of dollars. And, I don't believe our team was more talented than all the other teams. We simply had the right market timing with exactly the right game, inexorably leading to an enormous success. Within this company many other teams built clones, executed just as well if not better and yet, none of those games received the success as the first one with the right timing.
Market acceptance controls whether a company might fail. It doesn't control whether a company might succeed.
At least with an engineer, you can be hired by someone who could more-or-less do the job you're being hired for. Senior engineers hire entry-level devs. The CTO hires team leads. Who hires the CEO?
Often, there's no one in the company who is adequately prepared for that role, because the role doesn't have a job description. It doesn't have bullet points of what you do every day. Your job is to lead the company, set the expectations, set the results, for everyone else. That's the role of the c-suite.
Absent any, I think it is much more reasonable to conclude that there's little to no justification for current CEO compensation and that they draw their current compensations mostly "because they can".
EDIT: So collusion amongst CEOs explains why boards agree to it. Why do shareholders?
The his focus on CEO pay is nothing more than old-fashioned class warfare jealousy. Think how much more money workers could make if we cut payroll taxes by 20% — a lot more than if they paid the CEO $1. But those on the left complaining about CEO pay would go apoplectic just discussing tax cuts. Because the issue isn’t really about pay, it’s an ideological thing.
I'm sure Louis XVI was thinking the same thing right before the public summarily removed his head from his body.
You can't count the upsides for the shareholders without counting the downsides as well.
That's not to say that investors shouldn't be compensated for their initial risks when an actual funds injection is required, mind you; but them being compensated ad vitam eternam - and more generally, them actually owning the structure - makes very little sense morally for me (and beyond "morally", I don't see how this can result in anything else than progressive concentration of wealth society-wide in the long term).
You also assume people can "move on to another job" without too much trouble; again, that may hold true in tech or similar popular domains but it's far from true for a lot of people.
>I'm free to find other work.
A corporation is a model of communist dictatorship. The higher-ups control the means of production, they take your labor according to your ability and give to you your need (as determined by them.) In the sense that existing in a communist dictatorship is 'voluntary' then your work for the company is voluntary. And in the sense that being able to move from one communist dictatorship to another communist dictatorship is free then you are free.
That explains why communists revered Marx! He explained to them how it all works!
Because many software developers in SV might make over 100K (most do) but have vastly less money left over to actually save compared to someone earning less than half that in other places.
I recently considered an opportunity in SV and after getting over the initial shock of how much they thought I was worth, I realized I as in better economic shape staying where I am and earning what appears to be a lot less. And I'm not what I'd consider wealthy at all.
I recently saw an article here on HN about a guy who worked for Google for 10 years then quit and started his own company. He says in that decade he saved 100K, and my thought was, that's all, for 10 years at Google? I earn a lot less than he did, but I'm saving at nearly triple that rate.
2) $100k could be liquid savings in cash, with the rest in GSUs or diversified investments.
https://qz.com/848181/half-of-all-adults-in-the-world-have-l...
That's just not true.
If you're working in SF on 100k/year, your pay after tax is 5750. Spending 2k/month on rent leaves you with 3750/month, which is almost the pay before tax of someone on half that.
> many software developers in SV might make over 100K (most do) but have vastly less money left over to actually save compared to someone earning less than half that in other places.
Not that he couldn't afford to buy a substantial house in SF.
[0] https://www.zillow.com/homedetails/411A-Lincoln-Way-San-Fran...
Frankly a realistic number is $3000/mo for a 1BR and my point is that you could own an incredible home in most of the country for that price. People in SV have Stockholm Syndrome and justify the horrendous cost of living, rampant homelessness, insane working hours etc. with their cries of "but look at all my stock options!"
Meanwhile their counterparts in places like Austin make over $100k, can easily own a substantial home, have excellent life-work balance and shocker... have SUBSTANTIAL SAVINGS as well.
I'm not just talking about rent (which, incidentally, for my family, 2K per month is much lower than the rent we were looking at to accommodate our kids and private life without roommates in SF), but also about how much you spend on your transportation or gas every day, your healthcare premiums and deductibles, cost of groceries and entertainment, auto mortgages and/or insurance for 2 cars (because 1 car for a family wouldn't cut it there).... and the answer becomes obvious.
Otherwise, dream on.
A lot of professions make more: all doctors/dentists, 50% of lawyers, higher-level university administrators, most MBAs (mid-management and up).
Heck, even some cops in large metropolitan areas can pull 200K+ (with overtime)
How much of any of that do you think goes into lining the pockets of the highest person in the corporate food chain?
If you don't see the issue you are being willfully ignorant.
Stop it.
Or if you left your job, would you be legally required to delete all your work and have to pay tax money on an illiquid second-class asset that only has a percentage chance of payout(the startup scam).
As for HN, I love engineers and have been on HN for over a decade, but this site is the same as startups and ycombinator in general. Built for VCs to extract value out of engineers and the public.