If only more people realised this. Instead we do the opposite and worship the system which make them happen.
Very inspiring overall. I've always heard good things about the company but never knew of the founder. There's something about seeing one carry such dignified ideals throughout their life, without wavering to societal expectations, that is so admirable.
IMO, we should look at the value created and celebrate that rather than jealously fret over the concentration of the number of people who own it.
To be clear: I think what they did is admirable on both the building and the recent transaction. I respect them greatly for both parts.
One can benefit without being a billionaire.
In theory this would be difficult to do unlike the games that occur now because you don't merely need to suggest that you're not earning the income. You can't give it to a family member or it gets it with a hefty gift tax. You can't stuff it into a shell corp because you still own the shell corp. You could donate it to a charity which you control which is a thing that happens now.
GRATs and IDGTs will look like quaint children’s toys compared to the schemes invented to receive the benefit without formally having $10^9 of net worth.
Sure
> GRATs and IDGTs will look like quaint children’s toys compared to the schemes invented to receive the benefit without formally having $10^9 of net worth.
Well good luck then.
> verb
> discourage (a person or course of action) by removing an incentive.
Regardless, though, how exactly would your proposal not prevent someone from building future companies? If stock is considered monetary wealth (the only viewpoint from which we have billionaires), they would be forced to... What? Give away their existing stock in order start a new successful company?
If you start and retain ownership of a company that is one worth day a billion dollars, you're a billionaire.
That doesn't mean you have a billion dollars in cash. It doesn't mean you have a billion dollars in hard assets. It means you built a functioning organization that is performing some valuable service in society, and some accountant has associated some value to that entire organization of more than $1,000,000,000.
At what point do you think founders should be punished for that accomplishment by having some of their ownership stake taken away from them?
When they sell it for a billion dollars.
These listings of "net worth", etc. all include the nominal market value of their remaining ownership of whatever company they founded.
Jeff Bezos has a "net worth" of $160B. That's not because he sold Amazon for $160B. It's because Amazon is worth $2T and he still owns 8% of it.
At what point would you suggest the government should have taken away that 8% ownership so he would not become a billionaire?
I'm not suggesting that.
It's ok if people are billionaires, if defined by having large holdings that, if liquidated, would shrink to non billionaire scales to give back to society.
So I’d suggest the tax code be amended to account for that.
"No one is allowed to start a company by themselves"?
"No one is allowed to join a startup unless they get more than X% equity"?
"Startup founders must give more than X% equity to their first N employees and/or investors"?
"Bootstrapped startups are not allowed"?
"Once a startup becomes more successful than X, the founder must sell"?
Taking out loans defers tax. It does not avoid or lower it.
So long as you don’t die, and your trust earns more than the IRS theoretical rate you can pass on the money almost tax free. While still getting loans against it.
If you're starting from scratch, there are many ways to do so. For example, make issuing corporate charters contingent on being employee-owned - so if the company grows, so does the number of owners.
If you're starting with an economy with extreme concentration of capital to begin with, gradually ratcheting up progressive taxation on such concentrated capital seems like a straightforward way to force the owners to spread it around.
Money is power. Do you see no difference in a million people have a little power vs one family having enormous power?
Wealth is good. People acquire wealth by adding value. We want to incentivize people to add value. Of course, the "billionaires shouldn't exist" crowd understand little and less, and would happily have us destroy this system of incentives without even achieving their stated goals, because they, much like the "defund police" crowd, are more interested in appearing virtuous than in actually solving problems.
Those are axioms presented without evidence. It’s trivial to find counter examples.
I’m no radical redistributionist but the idea that wealth in and of itself shows added value is clearly wrong.
It's trivial to steal somebody's lunch money. It's much harder to become a multi-billionaire without making something that a lot of other people wanted to spend money on. (If those other people were forced to spend money on it by the power of the government, it's a different matter.)
Just because two people agreed to trade doesn't mean value was created.
First there's externalities. Global warming caused by oil companies. Stochastic terrorism and fragmentation of our polity caused by social media and news companies. Healthcare crisis caused by fast food companies.
Second the notion of voluntary trade is a fairy tail that's ignorant of the underlying neuro and psychological processes that go into decision making. The dopamine system is stupidly easy to game. It's like if we got a bunch of moths to kill themselves by flying into a bright light somewhere and we call that voluntary, as if we weren't merely hacking ancient circuitry. That's what's happening now with opioids, fast food, social media and more.
Reminds me of that adage: "Economics is the idea that if I pay you a dollar to step on shit and you in turn pay me the same dollar to step on shit, that makes for a better world"
Democracy and in a limited way, socialism (pensions for the elderly, healthcare, subsidized public transportation, i know this is not the original meaning, but for this its good enough) counterbalance the power gap between wealthy people and non-wealthy people, but clearly in the western world (at least in my country), the counterbalance is weaker and weaker.
I don't think a random millionaire like Eric Finman should have more power than a random citizen, and yet he have.
I don't think the "billionaire shouldn't exist" crowd actually exist. But i'm part of the "billionaires shouldn't have this much power" crowd, since it feels like in my country, they own the press, the executive and 40% of the legislative power. The judiciary power is the only one that might be a bit free from influence, but i'm not certain.
"People acquire wealth by adding value"
Some wealth implies value add. SpaceX.
Other wealth was partly figuratively stolen due to incomplete laws that prevent market failure. Purdue Pharma, slave trader, hitman, oil company (global warming), sex trafficker, social media company (societal fragmentation), fast food company (costs on public healthcare), landowners (regulatory capture), porn company (victims of revenge porn), car company (health effects of tire dust).
I'd say it's more the norm nowadays that wealth is partly stolen, figuratively speaking. The distortions and market failures have become so large.
The existence of externalities doesn't negate the adding of value. Would we be better off without oil companies? Obviously not (just ask a European!) Hence it's impossible to say that they're not adding value, or that the people who create them aren't adding value.
Patagonia here is the exception, that's why we're all here talking about it!
I didn't want to give my bit of power to my health insurer, but guess what, I have to have healthcare to live and there's effectively one local hospital I can choose.
I didn't want to give my ~~~bit~~~ hefty chunk of power to the company that gatekeeps the patent on insulin, but I really didn't have much choice on that one.
I didn't want to give my bit of power to the telecom conglomerate, but did I have a choice? I need to be online to participate in today's society.
I didn't want to give my bit of power to Google, but... uhh actually I didn't give it to them, they stole it by spying on me.
The reality is that concentrations of power that are inherent to our system of free exchange inevitably congeal into something that looks a lot less free. All of these examples (and there are so many, most of our economy is like this!) don't really represent individual value functions, because when power gets concentrated enough, it becomes possible to take choice away.
Forms of insulin for which the patent has expired are affordable. The stuff under patent is expensive but objectively better at its job. One could argue that the forms in between (patent recently expired but not widely available as generics in the market) are again due to the result of onerous regulations keeping competition out of that market.
Telecommunications, at least the hardwired kind, is a natural monopoly and I wish some smarter incentive-structuring would take place in that market; maybe public ownership of the infrastructure with competitive private service providers operating on top of it. Wireless is generally more competitive and you can actually be online for less money than you think.
I'm not sure what your point was about Google? You certainly don't have to use their services.
For example:
Food, agriculture, energy, media (print/radio/movies/home video), most commodities, productive inputs... there is little that you can buy that is not part of what I would loosely call a "conglomerate" -- that is, a concentration of capital so large and intense that it tends to influence the markets in which it operates. In fact, markets are today less competitive than they have ever been.
Those things that are (I would argue, seem) "competitive" here, like fashion, consumer products, and the like, are frequently as or more exploitative and influence markets (specifically, labor markets) abroad, up to and including slavery. Just because we don't feel that pain doesn't mean others are free of it.
This is because we have done nearly nothing, culturally, politically, economically, or psychologically, to stop the movement of power -- just as you described -- out of the hands of the many people and into the hands of the few entities that control such markets.
The free market, where each individual has the power of their dollar, is delicate indeed. Much more delicate than we have appreciated in the last several decades.
And it's not even all the employees of this single company who created it. The entire structure of society, technology, law and order, transport infrastructure, etc, etc, enabled such a concentration of wealth.
It's good to see when beneficiaries realise it's not really 'their' money at all.
Created a billion dollar company that people buy from to enjoy the outdoors (at least some of the time for a large portion of the customers)(or at least signal)
Did this particular billionaire evade taxes? used tons of governmental subsidies, or government-granted monopolies? Does this company look like it did not pay its fair share back?
Governments around the world have rules about companies, salaries, taxes and so on.
There exist a large number of billionaires.
Therefore, assuming most of them follow the rules, the rules allow such a concentration of individual wealth.
I'm not against innovators getting relatively rich, that's often the incentive to innovate, or at least to push through the 'perspiration' part of that activity, but there should be balance.
I completely agree that the current rules at least allow such wealth accumulation, which if applied across 8 billion people means that many will choose that path.
Personally I think the existence of billionaires is a systemic failure, is morally suspect to say the least, and that such extreme inequality is bad for society and slows progress, ultimately.
The research I've seen on this shows the opposite, eg the scandinavian model.
Once you get past a certain level, the money itself no longer has any meaning, it's more about keeping score. We should look for ways to satisfy that drive without sucking wealth out of the rest of society.
Clearly I've missed something, would you mind elaborating?
There are only a few countries that have a low Gini coefficient (more income equality) along with a high per capita GDP (more overall wealth) in north or western Europe such as Finland, Norway, or Belgium, which are very much the exceptions; for the most part, they all have a strong cultural background of being industrious, and in the case of Norway have a lot of oil.
According to the Wikipedia page on the Gini coefficient, the top 20 lowest Gini (highest income equality) countries are: Slovenia, Czech Republic, Slovakia, Belarus, Moldova, Ukraine, Iceland, Norway, Belgium, Finland, Kazakhstan, Algeria, Kyrgyzstan, the Netherlands, Denmark, East Timor, Sweden, Kosova, Malta, and Iraq. You'll notice that besides the northwestern European exceptions, they largely fall more on the "everyone is equally poor" side of the spectrum.
The US is in the bottom half of income equality, yet has one of the highest GDP per capita and the highest median household disposable income, which many agree is a very good way of measuring how wealthy ordinary people are.
To summarize, obviously having high income inequality does not cause a wealthy nation; but instead (going back to my original thesis) the factors that permit the building of a wealthy nation can cause high income inequality, which isn't a problem as long as the rising tide is lifting all boats. The few countries that are both wealthy and have low income inequality are virtually exclusively monoethnic societies that have a strong cultural emphasis on both the factors that are conducive to wealth-creation (like education and delayed gratification) as well as factors that forbid egregious displays of income inequality (like the Scandinavian Law of Jante).
I may go one step further and theorize that the same global factors that led to the rapid increase in wealth around the world in the past half-century or so did much to hide the failings of more egalitarian, "socialist" economic policies, much like the period of very low real interest rates of the last twenty years hid the failings of unprofitable VC-backed startups; and now that it looks like we are entering a more turbulent period with geopolitical instability and energy shortages, we may very well end up seeing a sharp reduction in the standard of living in countries like France or Spain as the ever-increasing redistribution of wealth in response to one crisis after another make it harder and harder to actually produce wealth.
Hey, since I played a roll in your success, can you please send me 10% of your paycheck every month? No doubt you won't protest since "the entire structure of society enabled" you to gain such wealth.
Bezos didn’t get rich in a vacuum. He did it by pushing warehouse workers to the brink of sanity and physical collapse. By making drivers per in bottles instead of taking bathroom breaks. Etc.
And then there’s Zuck. Does FB/Meta really provide value to society that warrants his wealth? Sire, within the confines of the rules we have in place it does. But that doesn’t mean we can’t question those rules.
Do basketball players deserve to make 10x the salary of CEOs? (Average, from top Google result).
A market where by individuals have the freedom to allocate their dollars towards things they need and/or want (among plenty of options) has determined so.
No one gets rich in a vacuum. Slave labor is illegal. Hundreds of thousands of people are paid along the way - inside Amazon, outside, the government.
The short answer: no, they don't, basketball has its own wealth distribution problem, but that's a problem within basketball rather than for society at large. (Non-superstar players are severely undercompensated, particularly when it comes to development leagues, college, and even high school.)
The shorter answer: we're not talking about CEOs, we're talking about owners and shareholders, so why even bring up CEOs?
It's an inefficient allocation of resources, since wealth brings marginally decreasing utility.
If it is consumed, then sure.
If it is invested by a wise rich person who can manage and grow businesses, then his employees/customers/investors/partners (and perhaps even their own trade partners) may well reach much more utility from the fruits of that wealth than the utility realized if the wealth ended up in less productive hands.
p.s. Possibly a feedback mechanism where each contributor votes a fraction back to the person/team in charge and valuation (compensation) emerges that way.
And they could leave at any point, they are paid for their work within 30 days. They take 0 risk.
As an entrepreneur for 20 years, I used to believe employees believe in companies and missions, but they don't, 99% of the time. They get paid for 30 days work, on time, and if they get a better offer they leave.
I'm sorry but that is 0 risk compared to what an entrepreneur does. People like yourself clearly have no idea how much responsibility and risk, and emotional strain an entrepreneur takes on, while employing people and paying them monthly. There is no comparison.
Don't expect people who take 0 risk to become millionaires. It's a ridiculous proposition. If that were the case "everyone" would be a millionaire, or a professional sports person, or an influencers, or whatever.
Taking risk, and building things yourself is much much harder. People who have never done it don't understand.
> They take 0 risk.
For wealthy worker problably, but for labor worker is not risky free.
> building things yourself is much much harder
Unless you work alone you don't build things yourself.
> People like yourself clearly have no idea how much responsibility and risk, and emotional strain an entrepreneur takes on
It seems like you don't have idea how hard it is to be in the bottom layer of the wealth distribution.
> Don't expect people who take 0 risk to become millionaires.
I don't think no one in this thread meant that. They are just advocating for better wealth distribution.
Did you offer those employees a chance to have a stake, to take a risk and share in the bigger reward than just their salary? I mean, in a meaningful way that had the potential to change their quality of life if it paid off? Were you willing to share the reward?
If you didn't offer such an opportunity, you can't complain that the staff didn't contribute to the level you hoped.
Just ask any freelancer how different it is to being an entrepreneur, even that change is a massive difference, you have to actually invoice and chase clients for payments, you have to take risk in whether you will actually be paid for work, etc.
Now just take it a step further for someone who is risking their capital, reputation, and time on creating something new, that might only make any revenue in 12-16 months, or never. And it might bankrupt them, lose their reputation etc. At a minimum that's 12-16x more risk than even a freelancer.
Oh and if insane people like myself didn't take this risk, the world would probably still be a foraging bunch of tribes. And you get hated for it for getting rich by exploiting people...
You have no idea about life, to be honest.
And you do? Everyone only has a small slice of what life is like. That is the life that you yourself lead. FYI I was a freelancer, chasing clients and invoices sucked, and was a waste of my time and skills.
You obviously have very strong opinions on how great entrepreneurs are, it is also coming across as "employees are lesser" as well which is not right.
There is nothing wrong (and a hell of a lot good) with not wanting to be a person that doesn't chase up invoices and worry about payroll, it lets you focus on doing a good job. Specialisation is a great thing, and would not be possible if everyone was busy marketing their own business/self.
> At a minimum that's 12-16x more risk than even a freelancer.
So they should get 12x the reward as the average? The average US wage is about $55k, so that would be, for a successful entrepreneur, 660k (and $0 for an unsuccessful one). I don't think anyone has a problem with this I certainly don't. I do have an issue with the ultra rich, like Bezos who have made 7.5 Billion a year since Amazon was founded, or 278,406 times the average wage from 1994 (26,939). Did he take 278,406 times the risk that an employee did. No. No he did not.
> Oh and if insane people like myself didn't take this risk, the world would probably still be a foraging bunch of tribes. And you get hated for it for getting rich by exploiting people...
And if everyone wanted to be an entrepreneur we would also still be like this. People need to actually do the day in day out grind work that is building things. 99% of this is done by employeed people. If everyone tried to do their own thing that would severely limit what can be done. You really need to stop looking down on your (and all) employees.
edit: fixed maths - Bezos has too much money for my math skills.
It has everything to do with this. Not wanting to be that person is fine. But then don't complain about people willing to take a lot more shit earning more than you. Generally, the stuff less people want to do (but is valuable to society), is better paid.
> like Bezos who have made 7.5 Billion a year since Amazon was founded, or 278,406 times the average wage from 1994
The guy created 400,000 jobs during the covid crisis, when most other businesses were either shut or going bankrupt. That's 1% of the US population. Going by your $7.5bn a year, that's $18 per new employee that year. You think he doesn't deserve that?
400,000 * 18 = 7.2 million, not 7.2 billion.
Amazon's deliveries avoided literally billions of in-person interactions during the peak uncertainties of C19. Bezos didn't start Amazon with that in mind, but it sure did help when called upon.
Then, people had the unmitigated gall to complain that Amazon made a lot of money during that time period. Well no shit; they provided a ton of value to hundreds of millions of people...
No he didn't. The business he founded did, the investors that invested in this business did, the customers that paid for services did. The people that made all of that happen were employees. He is not solely responsible for anything. For a long while he was responsible than many others in the organisation, but ever since he hired another person he was never responsible for anything on his own.
The idea that one person solely, directly lead to 400,000 people being employed is farcical. Did he really create a job spec, position, interview and do the paper work for 500 people each calendar day for two years?
No he does not deserve the money he has.
That's not how averages work. If 1 in 10 of entrepreneurs succeed at all and 1 in a million succeed notably, all of those millions of $0 outcomes flow to the 1 in a million (or 1 in 50 million?) success cases to make the average come out to whatever it is.
If it worked like you suggest and 10% succeed, you'd have 10 @ $660K and 90 at $0K for an average of $66K.
I don't think it takes away from my point, that some people have far outsized rewards for the risks they take.
People really don't have the sort of freedom to make choices that you're assigning to them. There's a thousand mitigating circumstances that limit peoples' options and can preclude the sort of risk taking that you're valorizing and shaming employees for not taking.
Fuck you buddy. You have no idea what I've done, what I've staked, what I won or lost, who I protect or what any of this means to me.
You're trying to justify keeping people out of your successes whilst complaining that they don't support you (and your business). How could they possibly deliver at the level you're expecting without the reward? Why bother?
So no, you have no idea of life or history.
So's yours. You're arguing that only might is right and that only greed works. You're simultaneously complaining that the people you're explicitly locking out of your chosen success path don't support you. Show me how you support them and I'll accept some of the rest of your argument.
> and it’s always the same.
Let me correct that for you: previous attempts to systematise broader opportunity have been corrupted by power. The bigger the attempt to make things fair, the further it's been corrupted. Those who don't care about fairness have abused the system for their own ends.
I still live in hope we can develop a system that decouples power from leadership, enables more people to have greater power over their own development, and better rewards collaboration and co-ownership. I acknowledge the failures from the past but I refuse to accept this is the only way life can be.
> So no, you have no idea of life or history.
I'm fairly interested in history and I have _a lot_ of ideas about life.
To that I would add that the only risk we're rewarding in this way is the risk to capital. While we do pay more for jobs that are more risky in terms of safety, it's close to impossible to become a multi-millionaire by risking your life in your job. I would say that kind of risk is higher than the one taken by entrepreneurs, but entrepreneurs and investor have an easier (though not easy) path to getting outsized rewards for their risk.
It's OK to reward risk, and it's OK to reward effort, and it might even be OK to reward risk more than effort. But by how much more?
No one is arguing that there shouldn't be any millionaires.
Also - yes, there are rent seeking evil billionaires. The 2008 banking crises showed that. There are also rent seeking evil slum lords who own $50k worth of real estate.
The problem isn't wealth. It's rent seeking with no value add, with government lobbying sprinkled in.
Surprisingly, this is an answerable question. It's not that we directly take away money from current existing billionaires — rather, we create policies that make SMB owners and working class the beneficiaries of the policies we implement.
For example:
1) Be more labor favored rather than rent favored in terms of tax policy. Like you rightly said, rent seeking is currently too strong compared to wages, tax policy should penalize rent seeking. This is only contentious because rent seekers are already too large of a population and would not support this.
2) Business environments that favor small business over large business. Large business is a choice, not an inevitability. I would much prefer a dynamic city with many small businesses (maybe higher prices overall) than the current cookie cutter walmart landscape. This is doable by policy, specifically creating policy that subsidizes small businesses and make them easier to start and run and penalizing large corporations.
3) Labor protection instead of risk and asset protection. For example, the wallstreet bailout is a policy environment that favors risk and asset protection over labor protection.
It's not that I'm pro-labor - trust me, when labor laws become too strong to the point that business suffer, I'm pro-business. But right now the working class is powerless to the point of suffering, while large businesses are at a historic level of return, even through multiple recessions.
Speaking of large businesses vs small businesses, I want to state again that there's a huge difference between billionaires and millionaires. Repeating again - large businesses are a byproduct of economic policy and not an inevitability.
Economic policy is not about optimizing for GDP or growth, it's about the preference of how you want your economy to run. Do you want cities where walmarts eat all the local businesses? That's a economic policy choice. Do you want billionaires? That's also an economic policy choice.
And the policy decisions are not "oh, you have a billion dollars, now we tax you." It's instead "oh, you have 6 buildings? maybe your 7th building will impose additional taxes." Oh, you are a giant multi-national shopping chain? Maybe we'll force minimum wage and benefits on your workers so that you can't expand everywhere recklessly. Oh, that rises the price of bread by .50$? Sure, we can live with that tradeoff.
This is what is meant by billionaires are a policy issue. It's not limiting your ability to be an entrepreneur - actually, a environment that is good for large businesses is usually bad for small businesses and entrepreneurship (because it favors the incumbents).
And that opens a massive can of worms. How does a paper billionaire pay taxes on paper wealth? Do you force them to take out loans? What if there’s a stock market crash. And they lose net worth? Do you refund their taxes?
It’s a really bad policy.
Most employees loan the company 45 days of labour. This is an "at risk" investment. If the company goes under, they may lose all of it. When multiplied by a large staff, this can be a very significant investment which would, if borrowed from a venture capitalist, be quite expensive equity. Yet, no equity is given.
Moreover, unlike founders and other investors, the employees are typically left in the dark about finances. When a company is in dire straits, venture asks for a large multiplier as return. Employees, that grant a "free" 45 day rolling line of credit do not enjoy this risk premium.
First, many employers pay bi-weekly, but deposit is delayed one cycle. You work, then at 2 week mark timesheets are submitted & approved, and then following week the auto payment happens.
Second, there is vacation time, which can be as much as 4-6 weeks accrued but not paid out. The average employee probably carries at least a week or three.
I hope this explains. Even though paychecks may be first in line, there is significant amount of the company's risk borne by employees.
He very easily could have given equity away to the employees and spread it around. Or had exceedingly generous profit sharing.
But he didn't. He ended up with all the equity at the end, and thus the billionaire.
> Why shouldn’t creating that much value in the world result in the owners collectively benefiting?
Billionaires make money from both value creation and value capture, but it can be argued pretty convincingly that value capture is how billionaires make their money rather than value creation. In fact, there's plenty of examples where value is created but not captured (open source being one of them) that lead you to realize that massive value creation isn't possible with just one person, but massive value capture is. Even superstar value creators like Einstein or Beethoven were ultimately just contributors to a larger scientific or musical community.
When considering economic policy, you have to think of it as value capture, value creation, and value distribution. And while it's nice to think of value capture as "the capture of the value you create", the reality is that value capture can be any systemic transfer of wealth. Gambling is a prime example of a transfer of value without any creation of it.
Billionaires are actually not the problem; the problem is that wealth captures too much value compared to wages, which then produces economic conditions of slavery.
It only matters when billionaires convert that paper into food, housing, jets, etc, for themselves does it actually affect anyone.
But, by a huge margin, the largest expense billionaires have is investment in other people and companies.
If billionaires squandered their wealth on short term self indulgence that would be one thing, but they don't. They typically give it all away.
I don't see the big policy failure here, or why that is a currently a problem that needs solving.
They do? The Kennedys, Rockefellers, etc certainly haven't. Those families have been massively wealthy for several generations.
The major issue is systemic instability and unnecessary poverty.
It is popular to presume that everything is not zero sum, but this is not the case.
I don’t see any good reason we should allow excessive potential energy to become the property of a class of people who want nothing more than excessive potential energy.
Jon Stewart once put it in a different frame: he called better policy "revolution insurance". At least that frames it in a way as to what the rich have to gain instead of solely focusing it on what they have to lose.
"It is utterly impossible, as this country has demonstrated again and again, for the rich to save as much as they have been trying to save, and save anything that is worth saving. They can save idle factories and useless railroad coaches; they can save empty office buildings and closed banks; they can save paper evidences of foreign loans; but as a class they can not save anything that is worth saving, above and beyond the amount that is made profitable by the increase of consumer buying. It is for the interests of the well to do – to protect them from the results of their own folly – that we should take from them a sufficient amount of their surplus to enable consumers to consume and business to operate at a profit. This is not “soaking the rich”; it is saving the rich. Incidentally, it is the only way to assure them the serenity and security which they do not have at the present moment." [0]
[0] https://www.nakedcapitalism.com/2011/09/marriner-eccles-on-t...
The solution has been repeatedly demonstrated and isn’t complicated. The benefits should accrue to the system that creates them in a balanced way. Limits on the return of capital, implemented as either voluntary donation or taxes and progressive income taxes.
People scoff at taxes vs representation but right now, today, they can avoid those taxes by donating that money.
In particular, there was: - Marcia Lucas, credited for "saving Star Wars in the editing" - John Williams
Not to mention all the people working on the special effects, the sound designer Ben Burtt, the list goes on.
The reality is that a "single person" doesn't create things like that. The "visionary/great man" ideal is just good PR.
I reject that proposition. It's how record labels (investors, etc.) gaslight their artists (founders, etc.) into signing bad deals.
The businessman ("anthropomorphized lawnmower"[1]) has excellent PR. What interests him is an ownership stake in your vision and execution.
> “From the beginning of [Dischord Records], people have said that the way we do things is unsustainable, unrealistic, idealistic, and we were just dreaming,” he said. “Well, the dream is now 35 years old, so they can go fuck themselves.”[2]
-- Ian MacKaye (2016)
[1] https://news.ycombinator.com/item?id=10040429 [2] https://www.avclub.com/buttholes-and-lawyers-how-a-lawsuit-t...
A credible relationship (such as an individual bringing value) can be (and has been) exploited by individuals who want more money for themselves.
Another credible relationship (that the network is the value) can be exploited by individuals who control the choke points.
Your examples are where individuals control the choke points, introducing artificial controls and preventing the healthy accrual of benefits to the whole structure.
I can stipulate; this is why running companies is hard.
Adversity exists. I don't think it diminishes my assertion that visionaries do, too.
A mediocre salary of $40,000 is enough to buy so many goods from competitive markets (phones, cars, anything you can get off Amazon/AliExpress). This becomes very apparent when you go to lesser developed countries.
The major costs in people's lives do not come from the billionaire class. If you tax them into oblivion and give that money away, it will be soaked up by housing anyway (look how sharply housing costs have risen after the growth in real income the past 2 years).
The sharp rise in housing costs in the past two years in some areas is down to complex confluence of factors, real income being one, artificial scarcity being another, the entrance at scale of corporate interests into residential housing being a third. Add historically low interest rates and fears of flooding, lack of water, and fire, and I’m not sure the increase in prices is such a simple relationship as indicated.
I’m also not suggesting we take the money and rain it down as stimulus checks. That was a desperate response —- we can do better.
Sure, they didn't do it alone, they had employees and the whole rest of society, but all those workers and the rest of society was there before and yet the business was not. Successful business enterprises don't just instantaneously spontaneously assemble because the world is capable of supporting them, they have to be created and if they cease to exist the world is worse off even though all the workers and buildings and so on still exist. (Also, the parts of society that enable successful businesses - and even basics like food and energy - are much more heavily made up of other businesses than I think people appreciate.)
Personally I believe each of these can have advantages in various situations. Some critical shared infrastructure and services I think do belong with government. Defence, healthcare, emergency services, perhaps some utilities. Charitable trusts have a place. But I also believe private citizens that demonstrate the ability to build and run businesses also have a place, a big place in the system. Private capital investment is a massive and highly productive and efficient force for economic good. Typical billionaires don’t spend billions on themselves. Millions yes, but most of those billions exist as shares that represent control of productive businesses that provide goods, services and jobs. If they spent it all on themselves they wouldn’t be billionaires for very long.
I don’t think it’s generally in the public interest or beneficial to society to confiscate businesses from their owners, and what? Give it to who? There is a legitimate concern that such control can lead to negative effects like exercise consumption or political influence, but the way you deal with that is to address those problems directly.
Did you mean 'excessive'? Or is this a term I'm not finding on Google?
That depends on the degree of centralization of any given variety of socialism. The other option is that they are owned and managed directly by the workers.
The main reason I think we don’t see cooperative worker owned enterprises very often is that employees generally are not interested in assuming the level of financial commitment, responsibility and risk that goes with ownership.
This doesn't really reflect reality though. Did Bezos take on more risk than anyone working in a high risk job? What does $100 billion worth of personal risk look like, for a person who doesn't already have $100 billion in assets?
Plenty of investors exit early, and the benefits accruing to a monopoly could theoretically just as easily be distributed to a collective as opposed to an individual, circumventing the billionaire issue.
It’s SV’s whole game to construct a NPV of a future monopoly, cash in, and move on, before the regulators come in. This has nothing to do with wealth generation.
I don't understand what you're saying. It's undeniable that Amazon revolutionized e-commerce and cloud computing. Otherwise nobody would be giving them money.
>the benefits accruing to a monopoly could theoretically just as easily be distributed to a collective as opposed to an individual, circumventing the billionaire issue
It does get distributed amongst a collective, and it's called equity. Theoretically, Amazon's first warehouse workers could have agreed to be paid in equity instead of cash, and then Bezos wouldn't have to take as much outside investment. If they had held on to this stock, they would easily be worth tens, if not hundreds of millions today. Obviously, this isn't practical in real life, so instead, this wealth got went to the investors that took on the risk.
If they give it away (many don't) they specifically choose where it goes, and often it's some legacy BS, like overpaying to get their name on a university library. Alternatively that money ends up going to their children and it stays in the family for generations.
Billionaires will not save us.
To their children, perhaps? Or to a non-profit they control, for tax reasons? Sure.
But in general, I believe, actual philanthropy is a relatively small part of the typical billionaire’s portfolio.
What universe do you live in???
Also the money they “give away” is given to their next generation typically not the public. Bill Gates would be the exception.
Opting out of fiat money (crypto is fiat in disguise) means living a rambo-like life of basic survival. Therefore a billion dollars sure means something. Not just paper.
All of this wealth they have accumulated gives them immense power and control over our society. Billionaires largely use their wealth to create even more wealth for themselves or to influence people, they don’t “give it all away”.
Your framing is extremely disingenuous.
Fair point. One thing noting is that overall asset value isn't always directly converted to product/services but rather it's used as leverage. Sometimes this leverage is intangible ("don't f with me, I'm going to sue you"), other times it's very REAL tangible leverage - see Peter Thiel and Gawker.
that's not an expense, but an investment, on which they (usually) get a return, increasing their net worth
> if billionaires squandered their wealth on short term self indulgence that would be one thing, but they don't
they do, just not enough to make a dent in their wealth because once it's grown so large, it's hard to spend it faster than its growth. If you have $1B growing at a modest 6% / year, that's $60M / year.
> They typically give it all away.
they don't (unless by "all" you mean "a small percentage"). Even the few who have pledged to give 50% away in their lifetime have not (since their fortune has continued to grow). There are exceptions of course (and MacKenzie Scott will probably be one of them).
As others have commented on, the real issue is that, in order for someone to accrue that amount of money in the first place, there has to be such a systemic societal inequality in regards to access to resources that economic mobility is effectively a dream for a significant swath of the population.
People here talk about billionaires simply being rewarded for their effort/risk - a proposition that is simply laughable (so, unless you are promised riches beyond your wildest dreams, you won't invest in the economy and community? Seems to signify sociopathy more than anything).
And, yes, that is the implication: in order to have the propensity to accumulate that much money, far more than any one human would ever need to survive comfortably, you have to exhibit a significant amount of sociopathy and antipathy towards your fellow man; a willingness to usurp resources far beyond any natural need; if only because of some arbitrary internal itch.
Chouinard may be the exception that proves the rule -- a billionaire despite his intentions and efforts -- if only because the market happened to align with his convictions, rather than any intention to capitalize on any product for financial gain in and of itself. Even a broken market is right twice a day.
Until quite recently, the quip was "millionaire." What forced the change was American socialist icons embarrassed to find themselves on the wrong side of the barricade.
> in order to have the propensity to accumulate that much money, far more than any one human would ever need to survive comfortably, you have to exhibit a significant amount of sociopathy and antipathy towards your fellow man; a willingness to usurp resources far beyond any natural need
It isn't money; it's net worth. An old-fashioned market crash could vaporize most of the inequality in a week.
In any case: wealth isn't "usurped resources."
Chip Wilson for example recently kickstarted a right wing political group in Canada with some seed funding of 350,000. Complete and utter pocket change to him, but well beyond what a regular person could hope to ever spend on their political interests.
Those people got that rich by profiting wildly off the backs of others labor, instead of increasing the wealth and quality of life for everyone.
Countries like Australia and Norway don’t have many wildly rich people, and they also have very few extremely poor people.
https://www.businessinsider.com/countries-ranked-by-billiona...
It's nice that Bill Gates uses his billions for tackling diseases, but he shouldn't be able to decide the fates of millions of people unilaterally. He's an individual wielding nation-scale power, and that's dangerous for everyone else.
The same is true for Musk, and it's especially true for the billionaires who are distorting our democracy (Thiel, Bankman-Fried, Bloomberg, Koch, Hastings, etc.)
I don’t know that I love the idea of billionaires being the solution to those two problems, but I do think that some part of our resiliency as a nation is because the government doesn’t have total control over those things.
Not to mention the obvious conundrum that this may be great when the party you support is in power but not so great when they’re not.
If your assertion is that nobody should wield nation-scale power, then I agree, and welcome to anarchism!
If your assertion is that billionaires are an effective check on governmental power, I'm... not seeing it. Particularly given how much power billionaires have to influence the government itself.
Now I need to go wash the fact that I just used "brand identity" in a sentence off my hands.
Even if Gates gives his money to ostensibly non-political organizations, he's still deciding how an enormous amount of power is transferred.
Even Steve Jobs' widow, who is giving small amounts of hundreds of organizations, is reshaping society according to her own design. While I'm aligned with her values for the most part, it is still terrifying to think about all the Powell-Jobs' who have billions that they are spending on things that harm us all.
For example, pharmaceutical companies in the US have killed millions of people through marketing and regulatory manipulation.
More to your point: as long as politicians are democratically elected, they can't brutalize and kill with impunity.
Just be upfront that’s the trade off for “innovation.” The economic environment that allows for such enormous wealth aggregation comes at a cost.
I would be more convinced if you could also link to studies showing how early family life and local history have no impact on developmental brain processes and don’t create culture traps.
Prescription drugs, used according to the bottle/doctor. Hard drugs mixed in with softer ones. Intentional drugging. Many ways.
What the government could do to enable what you’ve called out is help ensure more people meet the necessary lower levels of Maslow’s hierarchy so that when kids show up to stuff marshmallows in their mouths they can feel secure enough in the probable truth of the statements and even simply the return of the researcher to assign any probability to the appearance of a second marshmallow.
Step one is something like don’t let babies be raised in abandoned projects where everything they have gets stolen regularly from before they can remember.
Just because the fastest way of building something can win doesn’t mean we should do it that way. In fact, we almost always shouldn’t do it that way, upon inspection.
These two things together have widely been credited with changing the world.
The evidence is that it doesn't. Pharma companies rake in the money a ton but they're not the ones discovering new drugs, they're just the ones who ferry it to market.
Even if I can get the group of people I need for free (because all their expenses are paid) I still need land, materials, etc.
Accomplishing things becomes a problem of cooperation instead of acquisition. Instead of "Can I buy the things and pay people to do work" we have "Can we agree to allocate resources and work together".
You're assuming that one lone visionary is essential to success, and that a level of coercion is necessary so he can make people do the work. We're software people here. We should know to reject "visionaries". They're just idea guys, the same guys we laugh at when they say "Here's my app idea, you build it and we can split the profits 50/50".
"Every person who ever created a successful company and retained ownership of a lot of it is a policy failure".
Would you support that statement?
"Every person who ever created a successful company and retained ownership of a lot of it, causing them to become a billionaire, is a policy failure".
Presumably the GP only has a problem with that process when it results in someone becoming a billionaire. My guess is that they think people will still found successful companies even if it doesn't result in billionaires, or that the benefits from successful companies will come about some other way.
If an entity manages to obtain a massive amount of wealth, far surpassing its own needs, and there is a definite need for that money elsewhere, then that is a policy failure.
The obvious example is a single person who's a billionaire - a person doesn't need a billion dollars for a house and some food. But it could also extend to a company, or even a subsection of the government. It's just in that case measuring the need becomes several orders of magnitude harder (what should an F-35 cost anyway?)
As far as definite need, the GP probably had these needs in mind: Healthcare, food, housing, and an uncontaminated environment. I think the US is failing in these aspects in such a big way that I would agree and say "billionaires are policy failures".
Trick question! There is no money, no dollars. This is purely notional value, and you can't feed or house or decontaminate anyone with it.
And that's the problem with your statement. Most "billionaires" are billionaires because they (or, yes, their grandparents) built an incredibly successful organization which is now "worth" multiple billions and they still own some of it. But they didn't become billionaires by taking dollars from other people - they became billionaires by creating this value literally out of thin air, taking it from no one and depriving no one of housing.
Consider these two scenarios:
Person A is a sleazy businessman and manages to insert himself as an intermediary in every financial transaction in the US through bribing legislators. Over the course of a few years, he extracts $6 from every citizen of the US while paying only $20M in bribes. Yes, this person now has literally $2B in dollars, and I agree he is a policy failure.
Person B is a scientist who develops an idea for a more efficient airplane engine. He obtains venture capital funding and starts a company. 10 years later, he retains 25% ownership of the company, which is selling jet engines to Airbus and doing $500M per year in revenue on $450M in expenses. He re-invests the profits in R&D and employs thousands of people. The accountants say he could sell his company to GE for $5B.
Person B does not have a billion dollars, yet the media would characterize them as a "billionaire". This person is not a policy failure.
We should make it harder for Person A to exist. We should make it easier for Person B to exist.