Why on Earth should we sympathize with PayPal about internal aspects of their underwriting at the expense of a small business whose funds they've practically seized?
Crowdfunding is an inherently speculative activity, a way to invest in a team with the hopes that they will create a product that you'd like to see in the world. Trying to fit Indiegogo into a presales model to justify PayPal's outrageous behavior here is a Procrustean approach that helps no one.
And who's trying to entice them? Again, if doing business with Indiegogo projects is incompatible with Paypal's risk profile they shouldn't do business with Indiegogo projects. That seems straightforward.
Bizarre to think we should be sympathizing with, enticing, or otherwise fellating PayPal in this situation.
While I understand how easy it is to sympathize with the merchant here, as none of us will ever be payment processors, the reality is that the sum of your suggestions or assertions, if explored just as a thought experiment, quickly lead to a world where nobody can do payment processing without imposing absurdly high fees. Of course we can all see how unfair it seems to have all this money promised by seemingly wide-eyed and clear-minded open source software supporters. But Paypal has millions of clients and has to act in a way that generalizes across all of them, and which requires the least amount of trust to be placed in those clients. The only argument that Mailpile has is "but we're not evil," which is true, but still insufficient.
...nothing is being sold.
Crowdfunding is only popular because it's got a high success rate though. If only 50% of projects succeeded and provided rewards, and 50% took your money and ran, how many supporters do you really think would be left?
Crowdsourcing is a gift, like a donation to PBS, where you might get a coffee mug, but if PBS decides to to stop showing Downton Abbey, you can't rescind your donation.
If PayPal has a problem with charge backs, they could simply stop taking payments for indiegogo projects (which its indiegogo's job to vet projects, not PayPal's) or put in big fat letters that THIS IS A NON-SALE OF GOODS TRANSACTION AND ABSOLUTELY NO CHARGE BACKS WILL BE ALLOWED FOR MONEY SENT TO THIS ACCOUNT AFTER FUNDS HAVE BEEN PROCESSED before they click the final confirmation button. Which is basically in writing already when you agree to send funds to indiegogo or Kickstarter. Problem solved. If you have a problem with projects not delivering, don't donate, take it up with indiegogo, or take it to small claims court.
The problem is that PayPal is not dealing with real money but with credit cards. AFAIK, companies like Western Union don't have such onerous restrictions because they accept cash or as-good-as-cash.
...ABSOLUTELY NO CHARGE BACKS WILL BE ALLOWED...
Credit cards fundamentally allow chargebacks; you can't turn them off. If you want to do business with no chargebacks you cannot accept credit cards either directly or indirectly.
So why is this not a problem for IGG? Since it obviously isn't - they cash out 15 days after funding closes. If the difference is that IGG takes a higher cut, then fair enough, let PayPal take a higher cut.
So you're asking PayPal to create a new level of service. (They probably won't, but their business is up to them.) That's fine, but you[1] should probably do that before using PayPal. And if PayPal doesn't create the new service you want, don't use PayPal.
[1] By "you" I really mean anyone who's crowdfunding.
No, I'm just saying that the problem seems not to be a fundamental one. And the point here is that PP does accept payments on behalf of IGG. If I decide to fund a campaign, one of the payment options is PayPal (obviously that can be configured and turned off, since it's off for mailpile atm). The funds donated to mailpile via PayPal were donated via the IGG website. That means to me, that PayPal is well aware that the user is trying to fund a risky endeavour, since by definition all IndieGoGo campaigns are presale and likely to fail.
What I don't get here is: Why does PayPal as Payment Provider for IndieGoGo suddenly cop out and say "My dear, but that's too risky. I'll freeze the funds."
Your argument might be stronger if it didn't rely on labeling ...
The argument doesn't rely on labeling, though it does call a spade a spade.
A definition of "apologism" is "a defense or excuse, a speech or written answer made in justification." I'd love to hear why this is an incorrect characterization of the comment.
The short answer to your question is that you should concern yourself (not sympathize) with their problems when those problems intersect with yours and guide their decisions.
If I retain Matasano for work, I shouldn't need to obsess over the details of your cost structure or employee benefits packages; our contract should suffice. Similarly here, Patrick's description of Paypal's theory of underwriting is interesting, but irrelevant. Deflecting blame based on these issues is, indeed, absurd.
If PayPal's risk profile does not support doing business with Indiegogo projects, they should cease doing business with those projects rather than seizing thousands of dollars on spurious grounds. Feel free to debate the merits, if you actually have a difference in opinion.
Regarding the label you used: what makes it absurd is the notion that Patrick would be motivated by an urge to justify the actions of a 3rd party business he's barely engaged with. Here it pains me to cite Paul Graham's "Things You Can't Say" on the semiotic significance of deploying labels to make arguments.
Sure, those negotiations would happen before significant money or services are exchanged. And, presumably, we wouldn't enter into an agreement unless we were mutually satisfied. But arbitrarily deciding to withhold payment for your services after the fact, pending an audit of your workplace practices, for instance, would probably land me on the wrong end of an adverse action from you. And deservedly so.
Regarding the label you used: what makes it absurd is the notion that Patrick would be motivated by an urge to justify the actions of a 3rd party business he's barely engaged with.
I didn't (and wouldn't) claim that. I do however think that his well-reasoned, but irrelevant argument for why Paypal feels justified in holding $42,000 of Mailpile's money does indeed serve as apologism in the thread, motivations aside. If you think I'm arguing that Patrick is some shill for PayPal, you're barking up the wrong tree.
Here it pains me to cite Paul Graham's "Things You Can't Say" on the semiotic significance of deploying labels to make arguments.
And it's painful to watch. The argument hardly relies on this supposed labeling and I'd be surprised if you actually believe that. At this point you've already done more labeling, imputing of motives, and purely rhetorical arguing than you seem to think I have.
If someone chooses not to read the TOS, that's on them and it is their failure as a business operator. If they wanted to renegotiate the standard terms of the TOS, they should have approached Paypal before agreeing to the TOS or before launching their business activities.
It's not a hostage negotiation--there's no requirement that you start using, or continue to use Paypal.
He didn't imply this, he laid out a very eloquent case for it.
...the onus is on PayPal not to accept money for those projects. Full stop.
No, please don't stop with a naked assertion completely unsupported by any other statements you've made. Please describe for me how a business operating in one of the most regulated industries in our country, whose disclosures are voluminous and thorough, and whose business model is turnkey merchant accounts, has this obligation.
> This is absurd apologism.
I agree that what happens to Mailpile is A Bad Thing, but the reasoning as to why it makes financial (not moral) sense for PayPal to withhold the money is solid. There are other ways to send money across the world, maybe the lesson for crowdfunders is to switch to one that is more instant and less reversible, or at least offer them as alternatives.
Cynical answer: because PayPal co-founder Elon Musk is the next Steve Jobs, and cult worship doesn't listen to reason.
(I told you it was cynical.)