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Comment by peteretep | Hacker News Reader

> Page and Brin each own 25.9% and 25.1% of Alphabet's voting power, respectively, accounting for over half of the company's controlling shares. That's because of Alphabet's super-voting structure, which gives 10 votes per share of its Class B stock.

also:

> Mark Zuckerberg owns the majority of the voting rights to Facebook due to a dual class structure that weights certain shares over others.

I would like to see eminent domain used to restructure these companies with weird controlling shared structures in to being truly publicly traded companies as a first step. I have no problem with Zuck getting all the money his shares of Facebook are worth, but I have a big problem with him and the unelected Page and Brin having all that power with no recourse for the market. Am I being foolish?

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> I have a big problem with him and the unelected Page and Brin having all that power with no recourse for the market.

I just don't get that mindset. Private-company Google said "hey, we're down to be public, but Larry and Sergey will always control the company... cool?" And the market said: "yeah whatever give us those shares".

It's not like anyone was holding a gun up to anyone's head, forcing them to buy GOOG. They went into it knowing that their shares' votes would be useless.

Page and Brin are elected: the shareholders have validated their control every day since Google went public; anyone who owns GOOG has either been ok with that arrangement, or foolish to hold those shares.

> They went into it knowing that their shares' votes would be useless.

I don't disagree with that at all, and I would see the current holders compensated for their shares. What I _am_ saying is I don't think society is benefitting from this structure.

> the shareholders have validated their control every day since Google went public

What? No, that's not how that works. The market has decided solely on the current price for Google shares. There's no nuance about what the market thinks about Page and Brin other than they think that the stock is currently accurately price, no more and no less.

To be fair, it is not the role of a corporate to "benefit society", but instead to benefit shareholders.

We force corporations to do all sorts of things that harm shareholder value in pursuit of benefitting society. Voters get to decide what they want the role of a corporation to be.

> We force corporations to do all sorts of things that harm shareholder value in pursuit of benefitting society.

True, but those things are not the driving force of the corporate, they're things that the corporate has to do to remain in compliance with the laws of the land. There's a very different mindset between compliance (stuff you do as cheaply and minimally as you can) and your purpose - your raison d'être - the theme that earns the big promotions and holds the attention of the stockholders.

And as for voters deciding what they want the role of a corporation to be... well yes, in the same theoretical sense that voters can decide what sort of healthcare system they want. Or what tax system they want. Which is to say, not at all.

There are all sorts of things that don't benefit society directly that are consequences of things that do benefit society. In this case, maybe society doesn't benefit from the structure of Google, but it does benefit widely from the notion of private property, and the one is a consequence of the other.

I hear your argument, and it’s a good one. That said, we break up monopolies, we confiscate dangerous animals that people privately own, we tax inheritance... and we have well established rules of eminent domain for just this reason. As I said, I have no trouble with them being compensated fairly for it, and I think that protects the economic system.

Google has two classes of shares, GOOG (no voting rights) and GOOGL (has voting rights). Despite being worthless for the foreseeable future, meaning until Larry and Sergey sell their shares, the price premium for GOOGL hovers around $5.

https://www.investopedia.com/ask/answers/052615/whats-differ...

Or if one of them wants to cooperate with an external shareholder rather than the other. It's still two people who could have different opinions. Controlling another 25%+1 can be valuable.

> the unelected Page and Brin having all that power with no recourse for the market

The effective market when it comes to voting shares consists of hedge fund managers like Carl Icahn and Bill Ackman.

Nobody else is organized enough to beat the activist investors and they do all sorts of terrible things with that kind of power.

> Nobody else is organized enough to beat the activist investors

I mean, except each other, and I think I'm OK with that? I'm not saying this is a whole solution, but making Zuck and co accountable to investors is an _excellent_ start. We got the Magna Carta as a result of rich people competing with other rich people.

> I would like to see eminent domain used to restructure these companies with weird controlling shared structures in to being truly publicly traded companies as a first step.

My first question is "why?" What is this trying to fix or achieve, on behalf of who? Shareholders themselves can choose to buy or sell as they please, so I'm not worried about them.

The context of this article is monopoly. My feeling on this issue is that (a) it is a major factor in economic and tech progress (2) our current frameworks, in theory and especially in practice, are totally insufficient to deal with it. (3) Monopolistic positions are, paraphrasing Thiel, what most of the tech industry is about.

Beyond that, there is a lot that can be wrong with shareholder control too. One underlooked problem (IMO) is that "a committee is a committee." If money managers have all the control, we have the same company over and over again.

They did not do anything illegal.

How is this connected to "break up Google" argument?

If this was illegal, I'm sure the SEC would be on it not just for Google but for the million other companies doing the same.

Laws are what the government decides they are, and the details of that are very complicated.

Depending on who you ask antitrust is about the impact on consumers (competition, fair pricing, etc), not about whether some particular footnote to a law was violated due to someone misplacing a decimal point.

FTR the US government has historically in fact made multiple efforts to prosecute companies like Google for violations of the law, so...

Not really.

We, the people, choose the lawmakers (congress) via election.

I still don't see your argument. How is voting power tied to Tim's post?

I never mentioned voting power. You vote to elect lawmakers, and lawmakers draft laws with the assistance of lobbyists + vote to appoint unelected officials responsible for enforcement. Election has no direct relevance here.

"If this was illegal, I'm sure the SEC would be on it" is based on the assumption that laws are infallible text with obvious interpretation, when the history of law enforcement - especially in finance and antitrust - is very fuzzy and about interpretation, with interpretation often down to unelected officials.

The expression ‘break up a company’ carries some moral judgement in it, as if it’s a punishment for doing bad things.

Not sure exactly what it is, but it’s more a societal move that smells a bit of socialism. Google is a capitalist company in a capitalist system, but the breaking up companies / anti trust is a non-capitalist power above it that is willing to sacrifice money to create societal wealth.

Breaking up monopolies gives us more free markets, and is a move towards capitalism, not away from it.

It's fair to say it's a non-capitalist power, I think. It's the government interfering in the operation of companies instead of allowing it to be entirely controlled by the market players - for good reason, of course.

A capitalist alternative would probably look more like levying fees or capping prices to try and balance the market... which is something that also happens from time to time.

Even fees and price caps would not be considered capitalist or free-market - they both interfere with the market dynamics. In all cases, we need to interfere with the free market to improve goodness for society as a whole.

But we don't need to attach moral connotations to this – the companies have done nothing illegal, and the executives are doing their jobs. The issue is when technology is applied to natural free markets, a monopoly logically results, which kills the market if left unchecked.

Why? If investors are willing to give billions for an almost negligible influence on the company and their investment, so be it. Their choice.

I guess it's still better than just sending money down the drain like Softbank does...

Yes to "Am I being foolish?", I mean if you have to ask...

This story is worth mentioning:

https://wiki.fuckoffgoogle.de/index.php?title=Google_Agonize...

Imagine Google had filed for bankruptcy at the whims of Larry/Sergey during the 2007-2008 recession instead of buying DoubleClick. I believe that Google IPOed as a $23 billion market cap company.

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