One non-profit that works in this space estimates that 78% of the "family member or parent" abductions are due to a non-custodial parent. That would put the total around 159k, which puts the parent poster in the right order of magnitude.
5,213 karma · joined February 22, 2007
http://freakonomics.blogs.nytimes.com/2009/01/06/the-cost-of...
Thieves also redistribute goods in such ways as to lower their value. Let's say a biotech company pays $20k for a microscope. A thief steals the microscope and pawns it to someone for $20 who just thinks the microscope looks cool. Wealth has been destroyed through the misallocation of resources caused by the improper redistribution.
As for speculators destroying wealth by making bad investments: yes, they can, but they lose money when they do so, which is a self-correcting process. The CEO of a company can also destroy wealth by misallocating resources.
As for speculators getting lucky: yes, they can do that as well, but random chance tends not to be sustainable (a random strategy will lose on average after transaction fees), causing a self-correction that tends towards mitigating noise. Anyway, if they are lucky and right, they've still added valuable correct information, just as a company that randomly happens onto a successful product still created value.
As for speculators getting lucky by investing in a rising market: if the market rise is supported by fundamentals, then the speculators are still adding value by allocating resources towards worthwhile enterprises. What's the difference at that point between speculators and investors? If the rising market isn't supported by fundamental wealth creation (e.g. the central bank is printing money), there will be a correction, and the (long) speculators will lose money.
Don't get too tied up on the word information. Market processes allocate scarce resources in such a way as to maximize total wealth and wealth creation (as best as can be done with the information available). Sometimes correct speculation aids that process indirectly by sending price signals. Other times correct speculation adds value by directly allocating resources where they can best be used (investing money in a startup, or in a pool of companies, or in bonds, for example).
The CEOs got to keep their money because the investors made poor choices; the investors could have negotiated a clawback in the compensation packages, for example. But in some sense, you might even say that the CEOs gave the investors exactly what they wanted. If the investors had wanted a more conservative corporate strategy, they could have always pulled their money out and invested in Berkshire Hathaway, or they could have uprooted management. Management set out on a strategy that didn't turn out well, but they weren't hiding anything from their investors.
It gets a little blurry at high levels, but remember that at the end of the day, the CEO is just an employee. The owners are ultimately responsible for the company.
Having not reread this essay for a few years, I'd forgotten what a wonderful piece this was. Your exploration of the common fallacies that lead people astray is particularly clearheaded and well supported.
However, you might want to reconsider the way you lumped, in passing, speculators together with thieves -- implying that neither create value. Thieves clearly destroy value, whereas speculators add information to markets. They create value in a very abstract way that is difficult to recognize, but is nonetheless there. A speculator that accurately foresees a shortage of grain in 6 months and therefore buys grain futures provides a service to society (by raising the future price of grain over the spot price, causing people to warehouse grain, which will take grain off the spot market, pushing up the spot price, moderating present demand for grain, and preventing an acute shortage).
Pretend that starting a company wasn't an option for you. I guarantee there is some minimum wage level that would have knocked out the bottom rung in your career ladder.
In any case, passing by pointers is more time efficient than argument copying.
And while the impact of private sector unions may have waned a bit after 1980, the growing impact of public employee unions has more than covered the difference.
The problem with minimum wage laws is that they precludes marginal young workers from getting job experience that would help them build the skills and references needed to get better jobs. There is plenty of research showing that every time the minimum wage goes up, teenage unemployment goes up disproportionately.
This is already a solved problem.
SIP and DNS SRV/NAPTR records are the relevant (IETF) standards. The "sip:" part above is actually optional. Using NAPTR records, I can simply request yourname@yourdomain.com, and your DNS will tell me how I can contact you (via email, via Jabber/XMPP, via SIP, /dev/null, etc.) in order of preference.
As for the validation that you're seeking, I've seen people do much crazier things that have turned out well. Which is all to say that, yes, the idea is crazy -- maybe even just crazy enough to work if you are committed to it. It sounds like the downside risk to you is pretty minimal, so why not?
To get you started, here's your first tip from an entrepreneur: don't be too attached to the outcome you have planned now. Just like in a startup, once you start on your adventure, you may find that going in a different direction looks more promising. Take the first step, then go where opportunity leads you.
I think he's missing the critical point that they enjoy pissing it away (as he calls it). Being able to spend the money you acquire in ways that bring you personal enjoyment is the whole reason for acquiring money.
The bottom line is that it isn't critically important to a working system how wealthy people choose to spend their money toward the end of their lives. What's important is that they be allowed to spend their money in ways they enjoy so that their younger selves are motivated to make the money in the first place by creating wealth for others.
How hard would you work on a startup if I told you that, if it succeeded, you could only use the money to create another startup, ad nauseum?
What's much more saddening is when politicians get acclaim for spending other people's money in useless ways, since they never produced any value in the first place.
Hyperbole is the pepper of interesting conversation, and I think the randomness of mentioning Velcro made that intention pretty clear.
For what it's worth, I'm a proponent of space as well. I just think the Burt Rutan / Richard Branson route is more likely to get people like you and I into space in our lifetimes than a government program, which by its nature sucks resources out of the economy that could be used by people like Rutan who have an actual incentive to make it affordable. NASA has had over 50 years and they've done little to nothing to bring the cost of space access down. The Scaled Composites folks, as I understand it, were able to use very very little of anything that came out of NASA (except Velcro [1]), as it was all geared towards multi-billion dollar budgets.
Like you mentioned about Google being more or less inevitable, I believe Burt Rutan and people like him are inevitable (in a free market) when the time is right and the technical and capital foundation is in place.
(And I'll again point out that we're still missing the only point I really wanted to make here, which is that risking other people's money, particularly when they haven't freely given it to you, shouldn't be called brave even if you personally believe it's somehow worthwhile.)
[1] Velcro is actually a bad example anyway; it was invented long before the space program.
$125B+ (inflation adjusted) was worthwhile for inspiring people about what was possible.
Listen, I don't disagree that there were some benefits of the space program. But $125B+ is a lot of money for Velcro and inspiration. Let's keep a sense of scale here: if you assume YC invests $25k per company, $125B is 5 million startups (and 15 million or so founders). [1]
Just remember that the resources have to come from somewhere, and that if you're going to do it through government, you're spending other people's money to get things that you want. Someone else may not care about technology or the moon, and may prefer to spend that money on social programs or farm subsidies. Once you open the door that government takes the money and spends it, how can you possibly determine whose value system is better?
Also, to tie this back around to where we started, whether you support the idea of spending other people's money on projects that you like or not, my initial point was simply that risking money that isn't yours is not brave, whatever else you want to call it, because the politicians are not personally at risk of any loss. Worthless boondoggles don't even seem to negatively affect their reputation, and may even get them called bold.
[1] Note that I'm not proposing that the government should have invested in 5 million companies, but that an equivalent amount of resources was removed from the economy -- resources that could have built other things that people want.
This is my favorite example of this type of argument, because the moon visits should not have happened when they did. A handful of government employees spent a few days on the moon (at an enormous cost to other Americans) at least 40 years before there was any useful reason to get there. The evidence of this is that we haven't gone back.
As for your other examples, your claim is as absurd as saying that if it weren't for Edison we wouldn't have interior lighting or if it weren't for Bell we wouldn't have telephones.
If in 1978, we had diverted 5% of GDP for 10 years to building something like Google, we probably could have done it. But in 1988, it wouldn't have been terribly useful, and by waiting 10 years we got Google anyway at a much lower cost (and without coercively spending other people's money).
To justify the capital cost, it isn't enough to show that you'll make something cheaper than it is now. The capital investment needs to produce technology that is so much cheaper that it can outcompete other options and still provide a return on the capital that exceeds the opportunity cost of tying up the resources. If you can't expect this, then the endeavor is a net misuse of resources.
If Richard Branson (to pick a random spacefaring billionaire) was fronting a few billion dollars of his own money, that might be brave. Spending other people's money on boondoggles that are wildly unlikely to produce a positive return is not brave.
In the present case, we tend to spend all our time talking about how this will impact current VC firms. Existing VC firms have the advantage. The real question is how this will impact VC firms yet to be formed (or even yet put on a napkin).
At some level of regulation, new competition will be completely thwarted (imagine having to spend the first $10M and the first year of your startup achieving regulatory compliance), but what is often missed is the marginal effect. Any marginal increase in regulation will create a corresponding marginal decrease in new entrants just as assuredly as if you could artificially raise their expected cost to get to profitability (because that's exactly what regulation does).
This is why existing players in a market often lobby for regulation of their own market, or at least acquiesce to it without too much of a fight.
(Even though America itself certainly contains plenty of both models.)
Once the law is on the books, the intention of its authors will be forgotten, and the powers the law grants will be used broadly simply because it will be more convenient for an administration to use those powers than to achieve its ends in some other way.