Peter Thiel: Competition is for losers
online.wsj.com
online.wsj.com
To an economist, every monopoly looks the same, whether it deviously eliminates rivals, secures a license from the state or innovates its way to the top. I'm not interested in illegal bullies or government favorites: By "monopoly," I mean the kind of company that is so good at what it does that no other firm can offer a close substitute.
which is simillar to Robin Hanson's "manic" monopolist
One simple robust solution to the innovation problem would seem to be manic monopolists: one aggressively-profit-maximizing firm per industry. Such a firm would internalize the entire innovation problem within that industry, all the way from designers to suppliers to producers to customers – it would have full incentives to encourage all of those parties to put nearly the right amount and type of efforts into innovation.
It's not about rent seeking, or some silly brand recognition narcissism, but about being able to coordinate and do stuff that would be widely beneficial but unprofitable for any of the participants on their own.
http://www.overcomingbias.com/2014/04/rah-manic-monopolists....
That's a very kind way of interpreting what he's saying. I'd go as far as saying 'he's redefine common terms to fit a peculiar theory that is nice, simple and wrong".
It's mostly populist (to a certain crowd) pandering: a bit of controversy (monopoly is good!), a bit of pseudo-intellectualism (look at me being all academic and worldly!), and some 'please validate my prejudices' (patents bad, government stupid, big business bad except for those I'd want to work for).
"Actually, capitalism and competition are opposites"
This is why State capitalism or something like fascism to them is the ideal. Any democracy is the most HORRIBLE thing.
Because after all, there are only a few capitalists, and then there is everyone else...
It shouldn't be so taboo to discuss flaws in the capitalist system.. The article itself is a very raw exposition of a characteristic of it that I imagine is understood by people on both ends of the political alignment spectrum as a damaging thing, not that it couldn't not be.. I think the discussion matters because reality matters.
However, I do want to strongly note that "profit" here often gets re-invested into the company to develop new and better products (or use the money to damage others, aka the "jerk" behavior). This no longer is "profit" then, by definition, but now has become overhead in the company.
Meaning, "for profit" does not equate to "for filthy riches".
This has proven difficult in many situations. Is there any reason to believe that it can be done in e.g. USA?
In the U.S, corruption takes the form of old-boy networks for financial access, exclusive business relationships, under-the-table deals that you'd rather not be made public, close relationships between business and politicians, alumni networks, etc. In many other countries, corruption takes the form of bribes needed to even start a business, hired goons that you have to pay off for protection, unreserved Party loyalty, and midnight executions of people who are deemed a threat. As a startup founder, I get annoyed at all the hoops I have to jump through that have little to do with building a good product, but realistically, I am risking comparatively little and there are ways to convince people that don't involve obsequiousness. Doing something disruptive in, say, sub-Saharan Africa or China or the Philippines often involves much more significant risks to life or property.
That's one of the the basic failings of all the true free market capitalists (at least the ones who really believe in it and aren't just using the idea to manipulate others the way religions do with their 'flocks').
They have this naive understanding of human nature that believes such a system could exist without corruption when history shows again and again and again (and again...) that even if you start from a system relatively free of corruption, if there are not pre-existing checks and balances (eg. meaningful government regulations) that are constantly maintained the entities who "win" at the system invariably become corrupt in order to maintain the status quo that has worked out so well for them and they begin to tilt the system in their favor. Since they won (and thus have the most resources) they are in the perfect position to influence the system to bend to them, which they invariably eventually do if given the chance.
Never mind that said organizations would simply resort to setting up unofficial enforcement mechanisms, much like organized crime already does today. Other counter-examples aren't that hard to find either.
A lack of lobbying wouldn't prevent anyone from speaking to their representatives. The negative connotations around lobbying come from things like:
- Large campaign contributors getting more attention than constituents (even if their industry isn't in the state; See Orrin Hatch and Hollywood for an example).
- Lobbyists being people that know the politicians, and therefore are being paid to use that trust.
... etc
Oxford dictionary: Monopoly - 1) The exclusive possession or control of the supply of or trade in a commodity or service.
There is no way Google is a monopoly by that definition. Bing or any other company can and do compete. Google dominates because they are better but that is a very different thing.
This is absurd; most failed companies didn't face any competition because they didn't find a market; you can argue that they in some way failed to escape competition from alternative products to their own, that a firm is in competition with every other firm on the planet because they all fight for the money of their customers, etc., but this is specious.
Failed companies failed to sell above cost, and most failed to sell at all. Not much to do with competition.
You are saying the majority of companies that fail produce a product with no market?
I doubt that's the case. There is a market, however small and a product that is similar or can be substituted for your product is still in direct competition.
Point 1. The world of technology as we know it today was invented at Xerox PARC: http://en.wikipedia.org/wiki/PARC_(company)#Accomplishments. The GUI, Ethernet, OOP. What wasn't invented at Xerox was invented at AT&T Bell Labs: http://en.wikipedia.org/wiki/Bell_Labs. The transistor, major advances in semiconductors, UNIX, C.
Point 2. PARC existed on the back of Xerox's patent monopoly on copiers: http://en.wikipedia.org/wiki/Xerox#1970s. Bell Labs existed on the back of the AT&T telephone monopoly.
The government initiated action against both monopolies in the 1970's: forcing Xerox to license its patent portfolio to Japanese competitors, and breaking up AT&T. It's interesting to think about whether these actions were ultimately good or bad for innovation.
It seems that people don't even start to rail against monopolists until long after they've become obnoxious tyrants.
It also seems that there are plenty of other fine inventions in the world that weren't made by the benevolence of some monopolist.
And while C and UNIX are widely used I don't think they were extremely innovative; they were instances of a class, not a new class itself.
Finally, it is not clear how much state support was given to these labs. At least today, Xerox Parc gets 1/3 of its funding from the government.
And the government is clearly sui generis, you can't compare it to private industry monopolies.
Even if we didn't have Ethernet and OOP, we would end up with some kind of networking protocol and some kind of programming abstraction, as somebody would have come up with it.
Which is very different from discovery of, let's say, penicillin.
> None of my inventions came by accident. I see a worthwhile need to be met and I make trial after trial until it comes. What it boils down to is one per cent inspiration and ninety-nine per cent perspiration.
Inventing Ethernet isn't just a matter of writing down a protocol. Embedded in the simple abstract idea is years of experimentation to figure out how to e.g. detect and handle collissions, etc.
I used to be an engineer at an R&D outfit. You could describe our overall idea in one, somewhat long, sentence. But we spent years thinking and experimenting to work out the details. That's what the inventive process is like.
The reason monopolies are so inventive is because they have the time and money to engage in this slow, expensive process. Companies in perfect competition don't tend to.
Examples of Betamax and VHS, BluRay and HD-DVD, USB and FireWire show that given market demand a technology can achieve a reasonable degree of development and maturity even without monopolistic environment.
My point isn't that every new technology requires a monopolistic environment. My point is that monopolies (or oligopolies) are particularly good at developing really fundamental new inventions, while competitive markets excel more in making better variants of well-understood technologies. Blu-Ray and HD-DVD were competing optical disc formats, but the original CD was actually a joint-venture by audio giants Sony and Panasonic.
I think a great example is the work Google is doing in self-driving cars. It can afford this sort of blue-sky R&D because of the massive profits thrown off by its advertising business. One day the technology will be mature and you'll see companies compete to refine it and make variations of it, but it will have been Google, using the profits from its near-monopoly on search, that will have done the really fundamental work.
This is missing an important detail: It still has to be a product that somebody wants to pay for. Even a monopoly could have a zero or negative profit.
>>>>> By "monopoly," I mean the kind of company that is so good at what it does that no other firm can offer a close substitute.
i.e., the kind of company whose success can only be described thanks to hindsight.
So why are economists obsessed with competition as an ideal state? It is a relic of history. Economists copied their mathematics from the work of 19th-century physicists: They see individuals and businesses as interchangeable atoms, not as unique creators. Their theories describe an equilibrium state of perfect competition because that is what's easy to model, not because it represents the best of business.
Yes, exactly. Pretty much all classical / neo-classical economic thought is rooted in the idea of equilibrium, but a strong case can be made that economic systems are not equilibrium systems. Eric Beinocker covers this ground very thoroughly in The Origin of Wealth[1]. I would personally recommend this book to everyone interested in economics. Beinhocker and the other "complexity economists" present a model of economic activity as an evolutionary system with periods of punctuated equilibrium as opposed to a strict equilibrium system.
[1]: http://www.amazon.com/The-Origin-Wealth-Remaking-Economics/d...
In business, equilibrium means stasis, and stasis means death. If your industry is in a competitive equilibrium, the death of your business won't matter to the world; some other undifferentiated competitor will always be ready to take your place.
Bingo. Yes, the "goal" is to achieve a "monopoly" but even if you do achieve that, you don't get to set still and just collect limitless money for perpetuity... because evolution will eventually deliver a competitor in one form or another.
I've had this debate dozens of times and strangely enough I find myself siding with the economists on this one. Yes, the 'end state' of most economic theories is equilibrium; that doesn't mean that all of a sudden everything in economics is wrong. If your end state is equilibrium but you acknowledge that at any moment in time you're converging towards equilibrium, but also that at any moment in time your convergence function is different, then your theory might still hold. This is then the point where I argue that a system dynamics approach is the way to do that, but apart from that: I found the theory in the article flimsy and arguing a straw man. No economist in the literature today argues what Thiel apparently argues in the article (and book).
But probably that's just part of the spin to get people to buy the book.
They side with the equilibrium theory because if they didn't there wouldn't be an economics science to speak of (or at least, very smart people fear there wouldn't be). And because we don't want to lose the useful results (a cynic would say : or the many jobs in that field), ... we'll just believe that idea and ignore the many reasons to question it.
People don't realize just how much of science works like this. A lot of ancient physics theories are in wide use (e.g. newtonian mechanics), because of this. Architecture wouldn't exist if we had to run gravity simulations on buildings according to relativity.
Lots of theories don't really exist. In theory we can calculate strengths of materials. In practice we don't, because the theories used to do that get it wrong too often. How do we "know" strength of materials ? Well we measure lots of materials, and create a catalog.
In theory we should know why, say a vaccine, or a medication works. In practice we only have "after-the-fact" explanations. Yes we know what aspirin does, but we knew about aspirin long, long before we had any idea what it did. What I mean is that if medicine didn't have it's double blind studies following "let's just mix stuff together and see what works" methodology, we wouldn't have medicine.
Climate science has several proofs against it, which don't necessarily prove it wrong, of course, but when it comes right down to it : climate science takes bad measurements from 300-400 years and extrapolates from that what will happen over unseen timeframes with never-before-seen circumstances. Needless to say, statistically, this is not sound reasoning. Also: climate science simply does not use first principles. Why ? Because if you did that, there wouldn't be any climate science. It ignores the incorrect use of statistics ? Why ? Because if it didn't there wouldn't be a climate science field.
Even in the "pure" sciences this happens. Godel's treatment of logic is effectively ignored, to an extent. Given the incompleteness theory, don't you think, at an intuitive level, that logic just kind of has to be fundamentally wrong ? If we picked the right theories, after all, we did so purely by chance, and we've never really changed our minds since 2000 BC. Yet logic is presented as the be-all-end-all truth that supersedes all other truth (examine the history of that idea, and you'll soon conclude that this atttitude is a component of Christianity, or rather something from Greek culture that got incorporated into Christianity, spread with it, and the original belief in logic died out, but don't ever tell a mathematician that).
You can even point to historical situations where people did this, and they ... turned out to be catastrophically wrong. I guess the basic problem is a "local optimum". A given science gets to a point where it is no longer possible to improve it on a fundamental level without destroying the entire body of knowledge in that field, most of which is perfectly correct, or at least useful. So it is not done (take the relativity fight, and before that the black-body problem, take Godel, take ... Godel pretty much walked into a room filled with the core of mathematicians of the age, and told them not just that all of their theories to be presented there were wrong, but that the field itself was fundamentally unverifiable (just short of "wrong", think about it. It may be right, but you can never verify it. What are the chances you've just randomly picked the correct theory ?). Needless to say, this resulted in exactly the reception you'd expect them to give someone like that).
Analogs of them exist outside of that ecosystem, but it's not like the apps you've bought through iTunes AppStore will magically work on Windows Phone, should you decide to switch.
Facetime and iMessage can be replaced with any number of cross platform third party alternatives, many of them better.
http://www.investopedia.com/stock-analysis/031714/why-airlin...
"The landmark event in U.S. commercial aviation history – as important as the incorporation of sound was to motion pictures, or the forward pass was to football – was the Airline Deregulation Act of 1978. Prior to its passage, the federal government set rates, fares and schedules, guaranteeing profitability to each oligopolistic airline but doing its best to thwart innovation. "
So prior to about 1978 during certain stretches it was pretty good to be operating an airline.
The only true change had been low cost carriers, who can use their late entry to the market to avoid things like collective bargaining and route networks.
So now we have a dreadful airline industry that only survives by grace of the occasional direct investment by the government.
Is anyone making significant money out of search (apart from Google)? Does DDG?
As for why they would want to be in search. For Bing it seems highly misguided. DDG probably would like to be even 1% as big as Google, so they could sell adverts and make $billions.
I appreciated your effort to add to the conversation, but "They barely do make money." followed by "Is anyone making significant money out of search" doesn't add much to the discussion.
[0]https://www.ventureharbour.com/visualising-size-google-bing-...
Google just doesn't appeal much to the Chinese sensibilities, and especially earlier had very bad Chinese search results.
But he's completely wrong that this is a good thing, at least not for the overall economy in the long term, as opposed to individual companies in the short term. To extend his example, if the restaurant business were like search engines, you'd have a choice of just a few big chains (maybe macdonalds, and pizza hut) which would be on every street.
Direct competition is absolutely vital, because it drives innovation. Innovation is how companies escape competition.
Companies should perhaps enjoy some limited "monopoly" over their innovations, but they should not be allowed to milk them forever, and probably, for example, the current patent system awards much too much and too long a monopoly for much too little innovation.
Introducing, encouraging, or even mandating competition by splitting companies up, is required in order to keep companies innovating, rather than dominating and then exploiting, and it is one of government's most important functions, sadly neglected in recent decades.
Of course VC fund managers like Thiel would like you to believe that monopolies are good, since that's how they profit - invest upfront, and then reap huge rewards based on monopoly valuations.
Economists do indeed have models of perfect competition, and perfect monopoly. But these are not the only concepts that economics has. For example, the market for pharmaceuticals is competitive ex ante, but monopolistic ex post. Anyone can choose to put research into developing a drug. But having discovered a particular drug, they have a monopoly over it.
Even though the monopoly is bad ex post, the promise of a monopoly is needed as an incentive to engage in productive activity ex ante. The same applies even more to company's like Apple and Google who maintain their monopoly by creating a unique product.
So the article is completely wrong when it says "To an economist, every monopoly looks the same, whether it deviously eliminates rivals, secures a license from the state or innovates its way to the top. I'm not interested in illegal bullies or government favorites"
Every kind of monopoly looks the same ex post, but monopolies achieved through innovation and monopolies achieved through bribery or favoritism are completely different ex ante. The first kind of monopoly incentivizes inventing new things. The second kind incentivizes unproductive activity such as bribery.
This was a small sample size, but I want to expand it with a more comprehensive study. Where most In-N-Out fans go wrong is that they compare a $1 McDonalds Cheeseburger that has no lettuce or tomatoes, etc. with a $4 In-N-Out burger that lots of garnish and Thousand Island Dressing. A more "accurate" comparison would be between one of McDonald's Quarter-Pounders, of similar price, and In-N-Out, but ultimately the dressing is going to cause the divide... not the "high quality/freshness" of the burger.
- Economists don't like monopolies due to dead-weight loss. However there is only dead-weight loss if the monopolist cannot price-discriminate. If they can price-discriminate, it's simply of a transfer of wealth from customers/employees/suppliers to shareholders. So there is some room to argue against it on efficiency grounds (if they can't price-discriminate), and definitely room to argue against on equality grounds (if you care about such things).
- Unregulated monopoly is the most profitable form of business. Abusive monopolies are probably more profitable than nice ones. Abusive monopolies are illegal (?). As a manager at a US public company, you are legally required to maximize shareholder value, ie try to create an abusive monopoly, ie break the law.
- Monopolies are bad for everyone except the shareholders and probably management
- Oligopolies probably do more R&D than monopolies, as monopolies don't have an incentive to spend money on research. Perfect competition leaves no profit to spend on R&D
"But the world we live in is dynamic: We can invent new and better things. Creative monopolists give customers more choices by adding entirely new categories of abundance to the world."
Okay, I'll try to understand this:
I'll go back to the Al Capone "A person can get much farther with a kind word and a gun than with a kind word alone."
Well, with a VC firm an entrepreneur can get much farther with "new and better things" and traction significant and growing rapidly than with "new and better things" alone. Or, with the traction, a VC might just assume there are "new and better things" in there somewhere?
I first ran across a reference to this in a paper from the Federal Reserve Bank of Philadelphia, written by Keith Sill, chief economist, "Macroeconomics of Oil Shocks":
"From 1948 to 1972, the price of oil produced [that is: extracted] in the U.S. was influenced by the production quotas set by the Texas Railroad Commission (TRC). Each month, the TRC (and other state regulatory agencies like it) made forecasts of petroleum demand for the upcoming month and set production quotas to meet the forecasted demand."[2]
A more complete history occupies most of Chapter 13, "The Flood", of Daniel Yergin's The Prize: The epic quest for oil, money, and power.[3]
The short version: in the 1920s, an early abundance of oil which was proving hugely useful for automobiles and machinery looked to be iffy, until vast deposits were found in Texas and Oaklahoma in 1930. But that created a new problem: with no restrictions on drilling, oil prices collapsed to as little as $0.13/bbl. Government production controls were prohibited by Texas state law (lobbied for by independent oil producers), though they were permitted in Oklahoma. A target of $1/bbl. was set but there was no way to enforce it. Before this was resolved, Oklahoma's governor had mobilized the militia to take control of its oil fields in August, 1931, Texas mobilized the National Guard and Texas Rangers shortly after, an oil shutdown was enforced stabilizing prices. With the Depression settling in across the U.S. (and in the wake of the Teapot Dome scandal, itself over oil), Franklin Roosevelt appointed Harold Ickes as Secretary of the Interior, and established a number of measures including "certificates of clearance" for all oil shipments within the US -- oil without certificates wasn't salable.
That regime remained in place until March of 1972, when peak oil extraction in the US meant that limits were no longer necessary -- slack demand was now being met through imports, not domestic production. Which left the U.S. vulnerable to a foreign oil embargo, experienced in October of 1973.
There's a pretty strong argument to be made that stable oil prices, as the base of the U.S. economy, had a great deal to do with uniform economic growth in the post-WWII period, from 1945-1972. It's after that date that many of the "modern" crises of economics have been felt: stagflation, offshoring, wage stagnation, etc.
There have been better and worse times, but those have tended to be driven by total global oil abundance (or shortages), with cheap oil beginning in the mid-1980s through the late 1990s, with few exceptions (1990 and the first Gulf War War notably).
But yes, a noncompetitive controlled market can be a good thing.
More: http://www.reddit.com/r/dredmorbius/comments/2akwjj/oil_and_...
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Notes:
1. http://www.ycombinator.com/rfs/
2. http://www.phil.frb.org/research-and-data/publications/busin...
See "Capitalism" by George Reisman pg. 189
The Arab Oil embargo wasn't "enabled" by US price controls, it was enabled by the fact that the Arabs states involved supplied a substantial fraction of the world's oil supply.
And, while it was certainly a response to action by the US government, it wasn't to US oil price controls, it was to US support for Israel.
> This all stopped when Reagan, as his first Executive Order, repealed the price controls.
No, its stopped because by the time Reagan became President, Arab state priorities had shifted (with many favoring increased deliveries for domestic economic reasons), overall production distribution had shifted greatly increasing the share of non-OPEC production, and US consumption had dropped, which led Jimmy Carter to issue an executive order ending price controls (which Reagan accelerated.)
I lived through that time. There was a pretty sharp line before and after that EO - I never was in a gas line again, and was in the months leading up to it.
Carter had 4 years to eliminate the price and allocation controls, and left it to Reagan to repeal the price and allocation controls 8 days after being inaugurated.
As to it enabling it, the price controls prevented domestic prices from being bid up so that domestic supply could be increased to blunt the embargo. Non-Arab oil imports could raise their prices, but because of the price controlled cheap domestic oil, which they'd be competing with, they sold instead to Europe, etc., from where they'd get higher prices. In essence, price controls enabled the embargo because it prevented the market from responding to and circumventing it.
Reisman goes into some detail on this in the reference I cited.
There had been previous attempts at oil embargoes, particularly in 1967[1] and 1956[2] during the Six Day War and Suez Crisis, respectively. Neither was effective. At both times, loss of supply could be made up for elsewhere. Peak oil in the U.S. lead to vulnerability.
________________________________
Notes:
Waves of economic thinking tend to coincide with one crisis and go out of fashion with the next crisis. Most economic policies that were once popular can thusly be blamed for "uniform economic growth" in a chosen period.
That was the whole point of the TRC quotas: to match wellhead output to demand. If you'll follow my reddit link above I show the growth trend in GDP and oil prices -- what was achieved was a very high level of price stability. Not through direct price controls, but by matching levels.
Post-1973, prices wander all over the map, see BP's Annual Statistical Review:
http://www.bp.com/content/dam/bp/images/other/Energy-economi...
From: http://www.bp.com/en/global/corporate/about-bp/energy-econom...
Note that prices stabilize in the mid-1930s, and actually fall in real terms through 1973. The period since is marked by profound variability.
The good from supply and consumption matching is that there was a high degree of economic stability during this period.
> That regime remained in place until March of 1972, when peak oil extraction in the US meant that limits were no longer necessary --
I come from Europe, where tons and tons of regulation is no longer necessary, but has somehow transformed into yet another tax. Oil price controls were introduced in Europe as well, but they somehow transformed from a bottom under prices, into a 40%+ tax on gasoline.
It's diverted monies which would have gone to oil companies (and states), allowed for infrastructure investments, and hugely increased energy efficiency, particularly in transportation.
Nor when he expanded that out over numerous other Ivys and Stanford, then additional selective universities.
It wasn't until he'd created an existing, high-quality, attractive userbase, of interest to both advertisers and the general public, that he was competing with MySpace.
Sometimes the monopoly is in where you define your market.
Amazon took a similar tack, first going after book sales (an excellent market for online commerce), then a broader set of markets.
They competed by innovating but that doesn't change the fact that they had to compete.
See Ha-Joon Chang's Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism for more on this.
"Chang blasts holes in the “World I s Flat” orthodoxy of T homas Friedman and other liberal economists who argue that only unfettered capitalism and wide-open international trade can lift struggling nations out of poverty. On the contrary, Chang shows, todays economic superpowers—from the U .S. to Britain to his native Korea—all attained prosperity by shameless protectionism and government intervention in industry."
http://www.powells.com/biblio/2-9781596915985-8
Similar principles can be applied in business.
Do you have a reference?
You probably confuse a market leader of a nascent market with a monopoly. MySpace was popular, but even at its peak it was 1/10 or less of the size of Facebook.
Say there's a new product category, for example "pet-rock social sites".
The first site PetRockSter on the market gets 1M account. A second site, PetrockSpace arrives, totally obscures the first site, and gets 20M people.
Then a third one cames (PetrockBook), and everybody you know starts getting "pet-rock social sites", to the point that half the population or more is now using that third website.
Technically the first and second time were "monopolies" in their time. But they only had 100% of a very small niche market, before it matured, that is they had like 100% but of a small percentage of the whole population that would eventually get a social pet rock account.
You are only a legit monopoly (with all the power that entails) if a) you have a huge share of a market and b) that market is not blowing up and expanding at a fast rate. E.g the way Microsoft has a near monopoly on desktop OSes.
Today we have Microsoft Research and Google of course is funding lots of stuff that it's not really making money from.
Aren't patents there to allow a company to have a temporary monopoly, to benefit from its invention, which expires the day the patent expire ?
This quote by Thiel, in the article, contradicts his argument:
'By "monopoly," I mean the kind of company that is so good at what it does that no other firm can offer a close substitute.'
It's an extraordinarily simple, and obvious, line of separation that nobody could ever confuse in a free market economy with constitutional protections on individual liberty.
The line gets blurred when the government meddles in the affairs of businesses (like wire tapping) and when businesses lobby enforcement laws into place. Over time, as entropy increases, things may become hard to distinguish.
http://dailycaller.com/2011/05/13/vindicating-standard-oil-1...
I wonder if he realizes that he just made an argument for professionalization (or, worse, unionization) of software engineers. My guess is that he'd not like that can of worms. But it's open.
Doing typical corporate programming, the stuff that any CommodityJavaDrone can do, is for losers. I'm not sure that managing that kind of work (which is the only way to make money in that world) is less loser-like.
Right now, the less-savvy (or cornered) programmers do what their bosses ask them to do. The savvy programmers chase high-quality experience, read esoteric papers on company time, and only seriously work on the 10% of in-company projects that will help their careers.
This arrangement is anarchic but there are always enough people who are cornered (family/financial pressures) and can be pushed into taking the less-savvy path and doing what they're told. And the personal-brand-definers have more fun and may get promoted faster early on, or get to strike out as consultants, but they're unlikely to get seriously rich (500k+) as they would if, you know, programmers were actually paid what they're worth. So the VCs and corporate executives and (to a lesser degree) software managers still make out like bandits.
What if that changed, though? What if programmers collectively realized that we had allowed ourselves to be commoditized and were overcompeting and losing all over the place?
Since I've been grappling with this issue for years, here's some further reading from my blog:
[1] What’s a mid-career software engineer actually worth? Try $779,000 per year as a lower bound. ( http://michaelochurch.wordpress.com/2014/05/24/whats-a-mid-c... )
[2] Why programmers can't make any money: dimensionality and the Eternal Haskell Tax. ( http://michaelochurch.wordpress.com/2014/06/06/why-programme... )
[3] Programmer autonomy is a $1 trillion issue. ( http://michaelochurch.wordpress.com/2012/11/25/programmer-au... )
[4] How the Other Half Works: An Adventure in the Low Status of Software Engineers. ( http://michaelochurch.wordpress.com/2014/07/13/how-the-other... )
One reason might be that such unions already exist, e.g., http://www.iww.org/unions/dept500/iu560
Its customers set those prices by bidding on keywords. Not the other way around.
How anyone would find this to seem scammy I wouldn't understand.
It's an automated parsing script(either client or server side). For mentioned companies that are publicly traded and named in a story, the script looks up their stock listing and adds it and a hyperlink to the story for context. In most cases, though, it's not very helpful. But easier just to have the script run on every story than to do the linking by hand for a few stories.
What's more is that even a few hours to a few days after a story is released, the stock price no longer has any relevance to the story since the widgets are not pegged to that point in time.
Modern society is a funny thing
> And it won't make one bit of difference if I answer right or wrong.
> When you're rich, they think you really know!
- If I Were a Rich Man, from Fiddler on the Roof