Imagine the world, where instead of making billionaires and trillionaires, we would actually share with society. Providing affordable products/services to common people. Decommodification of life.
There's no money for public investments, but there is always money for wars. There's no money for raises and bonuses for workers, until workers show there's no company without them.
So, if there's no money for public investments, it's time to show there's no public for their wars and exploitation.
Engineers are awful at advocating for themselves, and that’s why they study and work twice as hard as lawyers and finance, have less perks (travel, food, cars, private offices) yet they get paid half as much.
The majority of people in finance are working in low paid back office or retail roles. Less than an engineer on average. You only hear about the outliers.
These finance jobs are low paid because they're not that skilled and many people can do them. Same basic reason as why fast food temp worker is low paid.
Just take company secrets and walk over to competitors. That is the greatest perks every engineers have but don't exercise it. Some literally become billionaires. You think China overnight taught of everything by themselves? Go ask what did the Japanese and SKorean senior engineers did over the weekends from 90s to 2010s. Law is only effective if it can be proven in a court and judge sentenced it. Vast majority never even reach the lawyers ear. You advocate means you most likely will divulge. The quietest and least "smart" engineers probably are the smartest and riches.
It's no surprise that the companies with all the money and influence over government have managed to manipulate the general public to turn against the things that could get in the way of those same companies exploiting their workers and screwing over everyone else in the process. I'm just surprised that such weak arguments were what ended up being actually effective!
On one side they tell you "You'll get Weekends off! You'll get more money! You'll work fewer hours!" and other side says "You can't talk directly to your boss! Corruption could happen in your union if you do nothing to stop it! Lazy people might keep their job unless HR documents the problems!" and somehow people are like "Man, I'd much rather spend less time on my family and hobbies than not be able to go directly to my boss!"
Same with regulations. One side says "Have clean air and water! Don't get screwed over by companies who poison you!" and the other side says "Billion dollar companies would have to pay more to not poison you! Look at all these terrible regulations we already bribed lawmakers into passing! Regulations BAD!" and people just eat it up.
Is anyone really upset by billionaires having their money tied up in assets? It goes against the public good to force someone to break up a public company just so that the owner has less assets on their balance sheet. Aren’t you really just mad at leveraged assets? Even non-billionaires can damage the public good doing that.
You were downvoted as a punishment because you made a retarded argument and HN users saw fit to not engage with words.
No billionaire is forced to break up a public company to pay taxes, the same as no average Joe is forced to sell his clothes to pay taxes. The idea in common is that if one knows that one must have cash at the end of the fiscal year, then one sets aside the money and simply avoids buying clothes or investing in assets.
People are billionaires because they “share with society”. They take a small fraction of the wealth and surplus they create. If you create $6 of value for every American and capture half of it you are a billionaire.
“Public investments” besides are heavily spent on. The majority of the US federal budget goes to welfare. If you want new infrastructure and so on, the primary blockers are the universal veto powers we hand normal people.
If they want to "share with society", it's nice, but they can do it after taxes, just like everyone else.
Even if a rich person reinvests everything, the control over large amount of money is what makes it problematic.
Also the idea that welfare doesn't go to investments is wrong. When you buy groceries (or anything really), there is a decision made by the management of the company you buy these things from to reinvest part of it to maintain or build productive capacity.
There is no need for a "capitalist" (owner of the enterprise) to insert themself into the process, they are useless middlemen who get a cut, essentially. (They are not so useless when they do actual managerial work, but then they can be just an employee like everyone else.)
You could always replace him with a "banker" who instead loans you the means of production on credit, but nobody is going to make you a lathe for free out of the goodness of his heart, nor buggies for your grocery, nor the produce for your shelves and meat for your coolers. The banker makes you take the risk because, if it fails, he probably takes your house.
Believe it or not co-ops exist just fine and some do very well. It sounds like what you would like is a co-op and I will be quite happy for you if you start one.
Bankers are even worse than shared ownership due to moral hazard (that's where muslim and christian view of money lending comes from), but yes, as a socialist I am in favor of coops.
> Even if a rich person reinvests everything, the control over large amount of money is what makes it problematic.
What about the control that out-of-touch politicians and bureaucrats have over large amounts of taxpayers' money? Shouldn't we find that far more problematic overall?
> There is no need for a "capitalist" (owner of the enterprise) to insert themself into the process, they are useless middlemen who get a cut, essentially.
Then why do newly created enterprises almost universally seek outside capital investment? Sounds like there is a need after all, otherwise you could just have a partnership structure and take no outside money whatsoever.
What's your solution to the local knowledge problem? Capital markets are like other markets. Capital gets allocated to where it's needed, holding aside market failure (which is what regulations are supposed to fix). Capital owners seek out the best return/risk, and because they are on the ground and diverse in views and skills, that solves for the local knowledge problem.
This is where startup seed funding comes from, capitalists like YC who are good at it rather than some incompetent. It's why bad companies eventually lose the ability to raise, freeing up societal resources.
What appears to be implicit in your comment ("There is no need for a capitalist") is an advocacy for central planning for capital. Although you also say "they can pay taxes" so maybe that's not what you're advocating for.
If you want to know what I think is best, it's possibly a wealth tax applied on global wealth, along with stronger regulations around media concentration, political spending, and a few other things. But to eliminate capital markets and push it all into a central planner is bad.
> People are billionaires because they “share with society”. They take a small fraction of the wealth and surplus they create.
That's certainly an opinion that some people have, but as the parent comment stated, companies don't run without employees, so the idea that the value created is solely attributed to the founders or other executives is not an empircal fact like you're claiming it is. There's no scientific formula for "how much of this result of a bunch of actions that multiple people took over the course of a few years is attributed to each of the people"; the only way to have any sort of objective delineation of that like you're describing is if you already bake in assumptions of how valuable each piece is before you've started, which just moves the opinions one later deeper.
I can't prove you wrong any more than you can prove the parent commenter wrong, because what you've said is based on so many premises that I fundamentally agree with that seem like universal laws to you.
> There's no scientific formula for "how much of this result of a bunch of actions that multiple people took over the course of a few years is attributed to each of the people"
I can think of a few. You've got things like Shapley values. But it's not a "neutral" way to attribute outcomes to actors.
It's funny actually, I read about Shapley scores ages ago, and then the go-to example was basically political corruption: assume a bunch of political parties with varying vote weight but no principles whatsoever, aiming to secure a majority to split a "prize" among themselves. But looking at Wikipedia now, it's practically presented as a method to guarantee fairness.
Either way, there's no neutral measure of value (or for that matter, effort) either. What a dollar gets you depends 100% on who else has dollars and how much, so productivity or efficiency can never be separated from distributional concerns.
Fair enough, I wasn't precise. There isn't one single objective way to do this math because, as you point out, different assumptions will lead to different results, and it makes it impossible to do neutrally. My reaction to the parent comment was mostly due to the rigid view that the way things work now is inherently right and proper rather than there being any number of plausibly defensible allocations of credit (and therefore the value generated), and I think many of them are probably a lot more defensible than what we have now.
> companies don't run without employees, the idea that the value created is solely attributed to the founders
That's why the owners get to keep what is left AFTER paying employees. It's called profit.
One way to become a billionaire is when you offer that stream of future profits securitized as "stock" to other people who buy those future profits from you and collectively value those securitizations at over a billion dollars.
The owner takes the risk that there is no (or negative) money left over after paying employees and all other costs. As a result, if there is money left over, they get to keep it. I suppose I should remind you that the vast majority of businesses fail. The entire dataset visible to you is imbued with survivorship bias.
Welcome to money 101. This is how all business works everywhere. Nobody thinks that value is created "solely" by the owners. That's a fake strawman.
> The owner takes the risk that there is no (or negative) money left over after paying employees and all other costs.
This is not true, and somewhat confusing, because "takes the risk" means two distinct things - making decisions and living with the consequences of them. Economic production is a collective effort. The management of the company is who usually makes the decisions; these might coincide with owner (especially in small business) but often they're just another employee.
On the other hand, bad decisions made by management affect everyone in the company, not just the owner. The rich enough owner rarely lose their livelihood (we have limited liabilities btw), but the employees might lose the only source of income.
And the system where you have only one person (owner as main manager) making decisions ("take risks") that can negatively impact many people (his employees, customers and what not) is structurally risky, it actually increases the risk of something going wrong (aside from it being a moral hazard). (POTUS is an extreme example of this.) The risk is shared (collectively owned, if you will) and so should be the decision-making.
What if over time, the system degrades in such a way that there's a group of people that extract more and more value from the system while adding less and less value themselves?
Is this a possible failure mode of the system?
What sort of symptoms might one look for in a society if we believed this might be happening?
Or do we simply dismiss that this has been proven impossible (as per the theory of Money 101) and move on?
> The owner takes the risk that there is no (or negative) money left over after paying employees and all other costs. As a result, if there is money left over, they get to keep it. I suppose I should remind you that the vast majority of businesses fail. The entire dataset visible to you is imbued with survivorship bias.
Right, and CEOs famously are the first ones laid off when the company is flailing and losing money, because after all, they're the ones at the helm of the ship! And of course when a CEO does leave, they never get a golden parachute.
> Welcome to money 101. This is how all business works everywhere. Nobody thinks that value is created "solely" by the owners. That's a fake strawman.
Sure, but plenty of people think that the way value is distributed today is completely out of proportion to their contributions, and you're presenting it like the current way is the only possible rational way rather than an emergent property of the entirety of human history being an uneven playing field.
In an ideal capitalistic world billionaires are people that provide most value to society, yes. In the real world it’s questionable to say the least because they usually do not do fair win-win business, they do cutthroat “I’m gonna abuse my position to the absolute limit, what are you gonna do about it, you have no other choice” business. People that don’t do that don’t end up billionaires because they can’t compete with those that do.
The definition of „value“ in capitalism is already contentious, so even in idealized capitalism billionaires can provide „value“ that does not align with the „value“ of most of the people.
Contributing nothing isn't even the worst case. There are also people who make their fortunes costing society. The Sackler family made insane amounts of wealth as literal serial killers. The CEO of Nestlé make a ton of money killing babies. The folks at DuPont made huge profits knowingly poisoning people (and ultimately the entire planet). Some of the wealthiest individuals are also the most sick and dangerous people who have ever existed and are responsible for incalculable damages to society. The worst part is that they usually bribe their way out of any actual accountability for what they do.
Yes, and the contributions from those parents were so valuable that the society still owes them, even long after their death. That's why we pay our dues to their children and grandchildren.
> Yes, and the contributions from those parents were so valuable that the society still owes them, even long after their death. That's why we pay our dues to their children and grandchildren.
You're ascribing a level of agreement with your opinions about who deserves what level of credit people deserve for results that are far beyond the scope of a single person to vast swaths of people who have no power to contest the system that has existed for so long that no one alive created. The reason I "pay my dues" to the grandchildren of random rich people from 100 years ago is not because I owe them but because there's literally nothing I can do to avoid it regardless of how plausible I find the extreme opinion you're confidently asserting is some sort of self-evident fact.
Sorry, why would society owe their children? Where does this obligation come from? You're making a leap here that doesn't make sense.
Also, it's not sharing with society that makes people billionaires, it's taking from society. Had all that profit gone to society, they wouldn't be billionaires. Now often (not always) they provide some value to society but that generates that profit, but quite often even that was based on taking from society. They take natural resources to exploit, monopolise a market, exploit workers, etc.
You might be living inside a philosophy book about capitalism. Do you know about the existence of Russian oligarchs and their offspring? Or Texan billionaires that one day woke up and found out they were living on top of oil? What contribution did they give to society?
Well, I can give you Russian oligarchs - they came to their wealth during time of chaos, and mostly through stealing. But Texan oil billionaires? They won their wealth fair and square, if not for anything else then for just recognizing an opportunity and acting on it. Believe me, there are many people in this world who would blew it in stupid ways.
I won't even argue about Texans even though you're wrong there, but since you accepted Russian oligarchs as a problem with this world view that having money = having contributed to society then I'm not sure what else to say. You already admit this model doesn't work as a proxy to merit in the case of using force and connections.
Take another example, someone who won a lottery vs someone who hasn't, but otherwise lived the same life, in your world view one deserves it and the other doesn't. And their their offspring forever on as well? If you accept this now your list of exceptions is using force, connections and also luck. But we can keep adding examples and exceptions to the rule until at some point you need to admit that way of looking at the world is too flawed, no? BTW this luck aspect is the same as the "Texan got a knock on the door offering them millions forever because they have oil under their house" so I guess I did end up re-arguing that.
That’s actually a pretty good thing. Becoming a multi-millionaire is quite achievable in this country and if that means I provide a compounding ability to my kids to provide a large amount of value to a large amount of people and capture some amount of that, that’s a good thing.
Since 2/3rds of American billionaires are from industry, if it is true that their parents were multi-millionaires, that is wonderful. The fact that children here can take the platforms their parents build them and turn that into great value for the American people is a good thing and one of the reasons I am drawn to this country.
You are drawn to the multi generational accumulation of wealth and power? The societal ill our founders were concerned about that's currently giving us a high grade fever?
Brings to mind a certain creature that thrives in festering wounds.. It's in the tip of my...
Yes, I'd rather people bequeath their wealth and power over the generations than they waste it in purely self-serving ways, such as by buying yet another luxury yacht. Of course many billionaires choose to donate much of their wealth to charitable pursuits as well.
I think this is essentially correct. I'm sorry you're getting downvoted. I think there seems to be a prevailing attitude here (and in the world in general) that making money is 0 sum and you get it by taking taking it from others, rather than the reality (in free-ish, market-ish economies) that most people make money by adding value to other people's lives and being voluntarily paid for that value. Similarly there's a sentiment that policies are bad because billionaires lobby politicians, as opposed to that most people want terrible policies (though the lobbying can definitely be bad).
I guess one important nuace is that it's not all billionaires for whom this is the case. You have lots of Carlos Slim style 'get a government monopoly and collect the rents'. So it's a bit messy.
Almost all billionaires are parasites who don't really "create" anything except figure out ways to either game the money markets or underpay employees.
There's also all the various shenanigans they employ to avoid paying a fair share of tax, so they're mainly "stealing from society".
The level of wealth hoarding by certain people would be classed as a serious mental illness if they were hoarding something else, but it's actually far more damaging to the rest of the world that they hoard wealth.
Billionaires extract a vast amount from the economy and pay a tiny fraction of that back in. It’s not “creating value” to replace millions of middle class retail jobs across the country with tens or hundreds of thousands of largely poverty line jobs and parking the delta in shareholder investment accounts.
Without billionaires, money stays in the community where it circulates (workers and small business owners make money and they spend it). With billionaires it is extracted from the communities and hoarded in investment accounts a thousand miles away.
One day it's all going to trickle down, just like they promised us, keep waiting! All that wealth is going to leak through and soak our empty pockets until they are heavy with gold! The Holy Gipper wouldn't lie to us.
I feel bad for your sister. Only one reasonable option for an essential utility and all it costs your sister is hundreds a month plus sending all of her private data to a Nazi billionaire who is using it to train his AI while externalizing the costs of light pollution and space congestion/garbage onto the entire rest of the planet? It's looking like there's more than one trick to capitalism.
Maybe look for a better word that encompasses other political systems too - power?
There are many examples of surveillance states (and the best known examples were not labeled capitalist).
The surveillance you blame on Musk is the same from other ISPs - therefore your analysis is simply incorrect. She needs a VPN to avoid ISP snooping on the metadata (IP addresses used, DNS, etc).
And the US is a bigger snoop (Echelon, 5 eyes, Room 641A).
Our individual choices are limited in New Zealand (written on an iPhone - far more snoopy than my ISP).
Two sorts of people become billionaires from share price increases. The founders and the early investors. Neither are thousands of times more impactful than the other early hires, but they get to keep billions of dollars while the early hires only get a handful of millions. And the slightly-less-early-hires who were too late to get equity usually get nothing more than their salary, regardless of their impact.
I don't have any problem with people getting insanely rich from stock price increases, but the argument that it's society sharing the value they created ignores the fact that they were only responsible for the initial foundations of that value, and not all the work that continues later.
Society shares in the value because - insofar as the company is now worth say $X - that's because they have some way to create value that justifies a price of $Y per year for N people. And for those N people to be willing to pay $Y, they presumably have to be getting more than Y value (otherwise they wouldn't bother). So the real consumer value minus $Y is the 'value' created - the consumer surplus. Obviously there are exceptions but I think this is true in general.
And re the impact of the founders/early investors, I agree that they didn't contribute 1000s of times more. But like, if I bet a million dollars on a sports games and I get bet right and make 5 million would you say I ought to pay the players who really did the work? It's not about "adding value" its about property rights. The the second tier of engineers isn't happy they can (and sometimes do) found a competitor.
> Neither are thousands of times more impactful than the other early hires, but they get to keep billions of dollars while the early hires only get a handful of millions.
That's a meaningful tradeoff of risk vs. return. If you choose to be an early hire rather than founding your own risky venture, that ultimately means you value the security of "only" getting millions over a lottery ticket that might or might not be worth billions.
I guarantee the "median" payout is nowhere near that. The article said the average pay is 158 million won. I bet the median pay is less than half that.
It is the unions not Samsung's generosity; As union membership declines, inequality rises in the US while in Korea they are a force to be taken into consideration.
If you're in manufacturing and have a union in the US, there's a good chance your job just gets shipped overseas unless it's some sort of protected job that can't legally be done overseas (some defense stuff).
They probably slogged to death before this and finally are recouping what they were owed over their lifetime if you put things into perspective. I feel happy for them and hope they use it wisely and actually retire.
no--i was just making a slightly silly point about tech companies 1) laying off workers and 2) spending that cash on infrastructure (including chips) which goes to 3) Samsung and in this case 4) its workers.
I do wonder if this is good for Korea in the long run. There's not many employers like Samsung and SK that can provide this level of compensation for cost centers. I think many more workers are going to start demanding red carpet treatment when companies are choosing to outright shut down or move operations out of Korea due to increasing pressure from unions. ex) Hanjin, SsangYong Motor, GM, Renault Samsung/Renault Korea, Nestle, Tetra Pak, Hyundai Motor, HomePlus....
It probably is. Sharing in what is essentially a massive windfall is most likely positive. This money will get spend or invested by employees. Which should stimulate the economy at much higher level if it just stayed in stock market.
This is not standard thing. This is response in situation where company has generated massively more profit than any time previously and likely any time in future after market stabilises. Expectation that at least part is shared with employees should not be unreasonable.
Workers are supposed to always be worried about the overall economy, but companies firing thousands of people can ignore everything that is not related with their revenue/profit. It's hilarious.
I remember when I had these kind of takes. I blindly believed in "equal treatment, including billionaires". Now I get frustrated reading them, but I have empathy from understanding where they come from (for now, at least).
Meanwhile tech workers in the US spend all day online defending billionaires who wouldn't piss on them to put out a fire and arguing about why we can't have unions because blah blah blah rugged individualism.
I find this complaint hard to square when US developers earn "moon money" compared to both: a) fields requiring similar levels of expertise like EE or Mech-E and b) international developers in similar roles. Plus, equity.
The vast majority of tech workers in the US make nowhere near FAANG-money and have never had meaningful equity.
Also the fact that people in group $X are getting screwed more than people in group $Y is no reason not to fight to not get screwed if you are in group $Y.
This leverage all has to do with the product, how close you are to it and how valuable it is. FAANG product is valuable, but the programmers are still just creating it and usually a small part of it at that. Pilots are the product when the product is "get plane to destination" they are the 1 or 2 people providing that product (ok service). Athletes are the product of sports. It's very valuable and there's only a dozen or so of them to deliver.
Now, using the leverage is the difficulty to unionize. Athletes are a tiny group, pretty easy to organize. Pilots are a small group, also pretty easy to unionize. The fact they have to be licensed means there is a record for all the people needed pull in. Software engineers seem to be 5x-20x larger population than commercial pilots (quick/rough searches). They have no certification or registry organization and have no common affiliations. It's incredibly difficult to organize this group. There's also no regulatory capture requiring developers to be US citizens so, if you did unionize and tried to negotiate too hard the industry would just move away from the US so there's just not a lot of leverage this profession has.
Pilots also spend years logging hours in small airplanes, then regional airlines, getting paid relative peanuts, working crazy hours, rarely home, etc. before they land a high-paying job at a major national airline. And any hint of health problems, depression, substance abuse, etc. they fail their medical and it's all gone.
These "unions" in high paying fields behave more like guilds or cartels than worker's unions - they generally restrict supply. Athletes and Hollywood unions are sort of special cases too, IMHO. I don't think it's reasonable to claim that top earners in those fields earn so much because of their unions - they benefit from natural supply restriction of outliers.
For unions to be as effective in tech as for say pilots or doctors, you'd have to agree on a way to restrict supply (H1B restrictions, more licensing and credentialling etc) to give the union leverage. You have to control the supply taps and rate limit entry to the field.
I think it's hard to say if this would net out better for workers than the current arrangements, which are already the best in the world on nearly every metric.
It also seems like there's a timing issue - if tech workers DID successfully unionise enough to withhold a meaningful fraction of labour, the gains might ultimately end up in the market cap of AI companies via substitution.
Structurally the way it works is that the AMA or ALPA or what have you lobby for regulations that just so happen to limit supply, and heavily push back whenever anyone proposes regulations that would loosen it, usually on safety / quality grounds.
There are also revolving doors between the regulator and the relevant professional bodies.
I'm pro union in cases where employers are a monopsony and workers have few options - it completely makes sense for coal miners in a coal town to form a union to even things out. I just don't think US tech right now meets the conditions for it to make sense, the market is too liquid for employers to capture all the upside.
US tech workers have real problems and complaints - PTO, maternity leave, health care to start - but these feel to me more like structural features of the US labour market? It makes more sense to me that these should be subject to national regulation rather than specific advantages for tech workers carved out by a union.
Its very simple. Look at the profit margins of those companies, there's simply a lot more to share.
If you don't need to buy a product to make a product, or when you have to that's typically pennies on the dollar you can share a lot more of that.
The real difference here is that when the market is favorable you CAN share more. And Samsung is doing so. In the US you probably wouldn't be able to do this because the shareholders will cry and will happily give a 100M bonus to whoever will 'lead' the company better. Where better means diverting as much as possible to the shareholders
The US has some of the highest levels of wealth and wage inequality in the developed world, and it's never had greater economic stratification in 1-2 lifetimes.
The number of people making "moon money" is very, very small compared to everyone else in the industry.
What’s an average nvidia “tech employee” worth today? How about compared to their base salary vs. Samsung line workers?
You have a point. But on this precise topic it’s pretty hard to make. A tiny handful of companies who are winners beyond anyone’s expectations simply do not matter.
There is exactly zero percent chance this profit sharing contract would have been negotiated by either party as it is if this had been remotely predicted in advance. Same as the retrospectively extremely lucrative RSUs granted to nvidia employees just five years ago.
Tech folks employed by the top tech companies have been fine. I do not cry even a minute for them. The fun part of the Korean memory worker compensation is that blue collar folks finally are getting just a little bit of the taste the laptop class has been part of for so long. And it is likely to be comparatively very fleeting.
I feel the opposite. Looking at the yearly revenue of these companies and dividing them by the number of people that contributed, I clearly created much more value than my comp gave me.
I learned pretty quickly that money in Silicon Valley has nothing to do with getting what you "deserve" after a co-worker sold a domain name at the height of the dot-com bubble and retired on the proceeds. Sometimes people get lucky and there's no point in getting angry about it.
Do you think it's reasonable Zuckerberg or Bezos get rewarded the way they do while Amazon drivers piss in bottles and barely paid contractors get PTSD from moderating Facebook?
The system is rotten to the core. We as tech workers are somewhere in the middle, simultaneously being exploited while also benefiting from the exploitation of others.
Would you rather people not be allowed to do these jobs at all? That wouldn't leave them better off. Even paying them more must necessarily be weighed against the opportunity of expanded hiring at the prevailing market wage, lest you simply create a new privileged high caste of super highly paid Amazon drivers or Facebook content moderators.
I would rather not have people's dignity priced by the market, the same one that created the Zuckerbergs and Sacklers of this world.
Markets are fundamentally just a proxy for the interests of rich people. There can be no fair allocation of resources as long as the mechanism to do so is a figleaf for the oligarchy.
I think I have shown gratitude to all my employers. They have invariably treated me well, and I believe the relationships were mutually beneficial.
If you do not feel gratitude to your employer I suggest you find a different one. If you cannot find such an employer over an extended time frame, perhaps the problem is you.
401(k) and IRA’s were not a gift. It was a way for the companies to end the company pension plans in the early to mid 1980s. Half of the people who did receive them squandered them by cashing out before retirement to pay bills. If Social Security goes the same way most would squander it paying for necessities.
Most of the unionize workers still left in America get a better share of the pie than the non-Union workers not even close. It’s always good to work together in a union had to be footloose and fancy free by yourself.
I don't think it would be bad for equity in any way. It might actually be good instead actually.
First, the general public would have more disposable income if we shift more of the tax burden on the ultra rich.
Second, people like Elon Musk won't be able to give themselves massive bonuses that are essentially paid by diluting common stock.
Also, with regard to the U.S., the U.S. could wipe out its national debt with a one-time wealth tax, and also pass a balanced budget const. amendment so it never ends up deep in debt again.
Lastly, perverse and extremely greed-based exploitative businesses might become less common, since there aren't ultra fat executive paychecks. Although it might still happen if a large group of people are able to make a somewhat high salary off such schemes.
No way wealth tax covers the debt. It would be more of an asset seizure and forced sale or nationalization of a bunch of businesses and illiquid asset classes. The rich don’t hold enough cash to make it happen.
The other issue is the U.S. deficit is a feature not a bug. As long as the world buys the bonds, it’s “free” and no one will care until forced austerity happens.
Look into the end of the Gilded Age to see how this really gets fixed.
Nationalization is arbitrary and wrong. That's not what I'm proposing.
We'd largely be transferring shares in companies to the treasury bond holders, ie the people and orgs who hold US debt.
The federal government might for example force mega-sized private companies like Koch Industries to go public to get an accurate market valuation (or just sell it to private equity by starting a bidding war on it across many private equity investors).
The wealth tax cutoff would be determined by the national debt. It might fall to a relatively harsh / low threshold like 99.9% of assets over $20 million. Or maybe 99% of assets between $20 million to $1 billion, and 99.9% on assets above $1 billion.
Treasury bonds themselves would be subject to the wealth tax, so someone with $100 billion in T bonds might just see 99% of $80 million erased. So even the total number of T bonds payable will drop under this wealth tax.
But someone with $100 million in shares in private and public companies will see their shares transferred to the federal government, and then eventually sold.
Once every T bond has been paid off, Congress and the states could try to close the centuries-long chapter on debt by trying to pass a balanced budget constitutional amendment.
Well yeah America has achieved what the communists sought: public ownership of the means of production . Today most of the American public owns the largest means of production in government advantaged accounts. Marx ought to be proud
Actually, it’s the other way around in America the government and the people get to pay for the debt and the Robber Baron insiders get to scuttle away with the profit.
So basically most older professionals, and today's young professionals will step into their shoes as they grow their wealth over time too. Which means probably far more than 10% of the population will at some point in their life belong to that group which owns 90% of the means of production.
> will at some point in their life belong to that group which owns 90% of the means of production
Would love to but I'm afraid you grossly misunderstand how the power law distribution works. Unfortunately the billionaires are running away from us exponentially faster than we are catching up.
Speaking as someone who will almost certainly become a multi millionaire in the next decade or two. (even if I stop adding more savings manually)
But crucially this only happens if there _isnt_ a big revolution in USA. If there is, I'm fucked.
The idea that communism means that everyone owns everything equally is retarded. Communes themselves don't do this. People with more stake get more ownership
This corresponds to the first stage of Marxs theorized progession from capitalism too communism
Done hate the messenger. I'm just taking what I read and applying it to observed reality and telling you it fit.
Self described commies are dumb because they are incapable of enacting the very system they claim to idealize.
Can you show a commune that has lasted 3 generations? So like people move in, they stay and have kids and their kids stay long enough to have kids themselves. So at least about ~50 years?
My impression of all these communes is:
- idealistic people move in
- they realize 90% of the people that moved in are lazy and don't want to work
- the rest of the 10% run the show and the commune either breaks down here or kicks out many people
- kids are born, they grow up and by the time they get to university age they find the whole thing cringy and leave to go have normal lives
- commune ends
Other than some that also degenerate into sexual abuse between members and other weird power games. My impression of these outsider hippie / communist groups is that their failure rate is very high.
The United States, since most of our means of production is owned by the public. That was the point. The United States has the highest equity ownership rate in the world. We all have a stake in this.
That's just an infantile straw man though which has nothing to do with how communism works. Communism simply means that workers own their workplace and are the primary beneficiaries of their labor. In practice this means a mix of state ownership for cross-cutting concerns such as energy production or infrastructure and cooperative ownership for things like light industry. Cooperatives operate exactly the same way as companies owned by capitalists, except workers are in charge of running the company. Huawei is an example of how this works in the real world.
Maybe avoid opining on topics you have no idea in the future as not to make an ass of yourself in public.
Doesnt need to be tech. My blue collar UPS worker friend is all in on down with regulations, and claimed if anything we meed MORE billionaires. Many in America see regulation and taxes in all forms as bad, and the primary thing holding back prosperity for all.
I remember thinking like this when i was younger (hes older than me). Then here i am working nearly half as many hours as this guy, for 5-10x the pay.
This is a widespread, pervasive train of thought in America. Yet i wonder as the houses and healthcare stay expensive, food and fuel too... at some point this mental model breaks right?
In all honesty, I’d rather get paid the $500k/yr people make here than have a union negotiate a $350k one time bonus in a time of unprecedented success. Given these two options, I’m not that eager to have their system.
I mean, on levels.fyi the 90th percentile in San Francisco is 500k. Most of HN is tech workers in the bay area.
The average person on hacker news is easily in the 90th percentile of software engineers, so yeah, I wouldn't be surprised if the most people here make somewhere around there.
The biggest confounding factor is the other fact that most HN users are startup founders living off ramen in Peter Thiel's garage, so that probably brings down the average some.
I have a hard time understanding this complaint. A US tech worker earning $340k bonus wouldn't even make news, it happens every year all around the silicon valley.
That is, a US tech worker is taking much more for their own from those billionaire employers, compared to what Samsung's workers managed to do after a lot of haggling.
I mean as someone who works in American AI chip firms , our compensation is larger. You can bitch about America as much as you want but it's pretty much the best in terms of monetary compensation
Of course I'm late to the game. My colleagues who have been here ten years are either extremely wealthy and bored or sailing the Caribbean at this point. Every other week someone is taking a sabbatical
Very true, but some are acting like it’s the end of the world if a few people in the middle to lower end who worked very hard get a bonus and when I say work hard, I would say they probably in South Korea worked a lot harder that many people in the west in the same position have relatively speaking.
This is what bonuses would average out to in the US as well. It’s just that the CEO would get $100 million and the workers maybe $10k each. Does the article say how it’s going to work?
The Molly Maguire‘s lost a long time ago in America, the Goons, Pinkerton’s and the owners saw to that with a little help from the government and the police of course.
At the very top, yes and unfortunately many workers on both sides of the fence run interference/collaborate for those at the top it’s one of reasons the Molly Maguire‘s never win or rarely win for too long.
Left/Right alignment is relative, and the American political center is...where it is, and has been drifting rightward since Bill Clinton's "Third Way".
I think you mean who will protect the interests of the consumer? That's ultimately who loses to unions. There's no direct ethical value in protecting businesses or their owners but workers and consumers include pretty much all humans and their interests are in tension with each other.
Do not get deceived by the average number. I'm pretty sure that most of the money of the total goes to a handful of people, and the small remaining amount will be shared by the rest. Emphasizing the average amount is just their PR strategy.
These samsung workers are producing the compute that reduces demand for american coders. It's like pointing out that tractor factorymen are getting bonuses while the stable-manager gets laid off. Well of course.
Not all workers will fare equally. As an illustration, Reuters cited a union source estimating that someone in the memory chip unit earning an 80-million-won base salary could take home roughly 626 million won in total bonuses this year. By comparison, workers at SK Hynix stand to collect upward of 700 million won should their employer post annual profit of 250 trillion won, Reuters calculated. Unlike at Samsung, SK Hynix employees are not limited to stock payouts and may instead opt for cash, Reuters reported.
That's literally insane for Korean living standards. Those people can basically retire
I think it’s insane anywhere. Would have to put about 15-20 years worth of bonuses to reach that amount…
That's a bit of a stretch, but the number is bigger than I expected!
Imagine the world, where instead of making billionaires and trillionaires, we would actually share with society. Providing affordable products/services to common people. Decommodification of life.
There's no money for public investments, but there is always money for wars. There's no money for raises and bonuses for workers, until workers show there's no company without them.
So, if there's no money for public investments, it's time to show there's no public for their wars and exploitation.
Engineers are awful at advocating for themselves, and that’s why they study and work twice as hard as lawyers and finance, have less perks (travel, food, cars, private offices) yet they get paid half as much.
The majority of people in finance are working in low paid back office or retail roles. Less than an engineer on average. You only hear about the outliers.
These finance jobs are low paid because they're not that skilled and many people can do them. Same basic reason as why fast food temp worker is low paid.
Most engineers who advocate for themselves would simply be fired. Job hopping was the way to get your salary up fast previously.
Just take company secrets and walk over to competitors. That is the greatest perks every engineers have but don't exercise it. Some literally become billionaires. You think China overnight taught of everything by themselves? Go ask what did the Japanese and SKorean senior engineers did over the weekends from 90s to 2010s. Law is only effective if it can be proven in a court and judge sentenced it. Vast majority never even reach the lawyers ear. You advocate means you most likely will divulge. The quietest and least "smart" engineers probably are the smartest and riches.
That sounds like the kind of problem unions were invented to solve.
Unions are basically mafia.
Yeah, for the good guys.
The American propaganda machine has done a good job on Americans...
It's no surprise that the companies with all the money and influence over government have managed to manipulate the general public to turn against the things that could get in the way of those same companies exploiting their workers and screwing over everyone else in the process. I'm just surprised that such weak arguments were what ended up being actually effective!
On one side they tell you "You'll get Weekends off! You'll get more money! You'll work fewer hours!" and other side says "You can't talk directly to your boss! Corruption could happen in your union if you do nothing to stop it! Lazy people might keep their job unless HR documents the problems!" and somehow people are like "Man, I'd much rather spend less time on my family and hobbies than not be able to go directly to my boss!"
Same with regulations. One side says "Have clean air and water! Don't get screwed over by companies who poison you!" and the other side says "Billion dollar companies would have to pay more to not poison you! Look at all these terrible regulations we already bribed lawmakers into passing! Regulations BAD!" and people just eat it up.
So are corporations.
Is anyone really upset by billionaires having their money tied up in assets? It goes against the public good to force someone to break up a public company just so that the owner has less assets on their balance sheet. Aren’t you really just mad at leveraged assets? Even non-billionaires can damage the public good doing that.
You were downvoted as a punishment because you made a retarded argument and HN users saw fit to not engage with words.
No billionaire is forced to break up a public company to pay taxes, the same as no average Joe is forced to sell his clothes to pay taxes. The idea in common is that if one knows that one must have cash at the end of the fiscal year, then one sets aside the money and simply avoids buying clothes or investing in assets.
People are billionaires because they “share with society”. They take a small fraction of the wealth and surplus they create. If you create $6 of value for every American and capture half of it you are a billionaire.
“Public investments” besides are heavily spent on. The majority of the US federal budget goes to welfare. If you want new infrastructure and so on, the primary blockers are the universal veto powers we hand normal people.
If they want to "share with society", it's nice, but they can do it after taxes, just like everyone else.
Even if a rich person reinvests everything, the control over large amount of money is what makes it problematic.
Also the idea that welfare doesn't go to investments is wrong. When you buy groceries (or anything really), there is a decision made by the management of the company you buy these things from to reinvest part of it to maintain or build productive capacity.
There is no need for a "capitalist" (owner of the enterprise) to insert themself into the process, they are useless middlemen who get a cut, essentially. (They are not so useless when they do actual managerial work, but then they can be just an employee like everyone else.)
You could always replace him with a "banker" who instead loans you the means of production on credit, but nobody is going to make you a lathe for free out of the goodness of his heart, nor buggies for your grocery, nor the produce for your shelves and meat for your coolers. The banker makes you take the risk because, if it fails, he probably takes your house.
Believe it or not co-ops exist just fine and some do very well. It sounds like what you would like is a co-op and I will be quite happy for you if you start one.
Bankers are even worse than shared ownership due to moral hazard (that's where muslim and christian view of money lending comes from), but yes, as a socialist I am in favor of coops.
> Even if a rich person reinvests everything, the control over large amount of money is what makes it problematic.
What about the control that out-of-touch politicians and bureaucrats have over large amounts of taxpayers' money? Shouldn't we find that far more problematic overall?
> There is no need for a "capitalist" (owner of the enterprise) to insert themself into the process, they are useless middlemen who get a cut, essentially.
Then why do newly created enterprises almost universally seek outside capital investment? Sounds like there is a need after all, otherwise you could just have a partnership structure and take no outside money whatsoever.
What's your solution to the local knowledge problem? Capital markets are like other markets. Capital gets allocated to where it's needed, holding aside market failure (which is what regulations are supposed to fix). Capital owners seek out the best return/risk, and because they are on the ground and diverse in views and skills, that solves for the local knowledge problem.
This is where startup seed funding comes from, capitalists like YC who are good at it rather than some incompetent. It's why bad companies eventually lose the ability to raise, freeing up societal resources.
What appears to be implicit in your comment ("There is no need for a capitalist") is an advocacy for central planning for capital. Although you also say "they can pay taxes" so maybe that's not what you're advocating for.
If you want to know what I think is best, it's possibly a wealth tax applied on global wealth, along with stronger regulations around media concentration, political spending, and a few other things. But to eliminate capital markets and push it all into a central planner is bad.
> People are billionaires because they “share with society”. They take a small fraction of the wealth and surplus they create.
That's certainly an opinion that some people have, but as the parent comment stated, companies don't run without employees, so the idea that the value created is solely attributed to the founders or other executives is not an empircal fact like you're claiming it is. There's no scientific formula for "how much of this result of a bunch of actions that multiple people took over the course of a few years is attributed to each of the people"; the only way to have any sort of objective delineation of that like you're describing is if you already bake in assumptions of how valuable each piece is before you've started, which just moves the opinions one later deeper.
I can't prove you wrong any more than you can prove the parent commenter wrong, because what you've said is based on so many premises that I fundamentally agree with that seem like universal laws to you.
> There's no scientific formula for "how much of this result of a bunch of actions that multiple people took over the course of a few years is attributed to each of the people"
I can think of a few. You've got things like Shapley values. But it's not a "neutral" way to attribute outcomes to actors.
It's funny actually, I read about Shapley scores ages ago, and then the go-to example was basically political corruption: assume a bunch of political parties with varying vote weight but no principles whatsoever, aiming to secure a majority to split a "prize" among themselves. But looking at Wikipedia now, it's practically presented as a method to guarantee fairness.
Either way, there's no neutral measure of value (or for that matter, effort) either. What a dollar gets you depends 100% on who else has dollars and how much, so productivity or efficiency can never be separated from distributional concerns.
Fair enough, I wasn't precise. There isn't one single objective way to do this math because, as you point out, different assumptions will lead to different results, and it makes it impossible to do neutrally. My reaction to the parent comment was mostly due to the rigid view that the way things work now is inherently right and proper rather than there being any number of plausibly defensible allocations of credit (and therefore the value generated), and I think many of them are probably a lot more defensible than what we have now.
> companies don't run without employees, the idea that the value created is solely attributed to the founders
That's why the owners get to keep what is left AFTER paying employees. It's called profit.
One way to become a billionaire is when you offer that stream of future profits securitized as "stock" to other people who buy those future profits from you and collectively value those securitizations at over a billion dollars.
The owner takes the risk that there is no (or negative) money left over after paying employees and all other costs. As a result, if there is money left over, they get to keep it. I suppose I should remind you that the vast majority of businesses fail. The entire dataset visible to you is imbued with survivorship bias.
Welcome to money 101. This is how all business works everywhere. Nobody thinks that value is created "solely" by the owners. That's a fake strawman.
> The owner takes the risk that there is no (or negative) money left over after paying employees and all other costs.
This is not true, and somewhat confusing, because "takes the risk" means two distinct things - making decisions and living with the consequences of them. Economic production is a collective effort. The management of the company is who usually makes the decisions; these might coincide with owner (especially in small business) but often they're just another employee.
On the other hand, bad decisions made by management affect everyone in the company, not just the owner. The rich enough owner rarely lose their livelihood (we have limited liabilities btw), but the employees might lose the only source of income.
And the system where you have only one person (owner as main manager) making decisions ("take risks") that can negatively impact many people (his employees, customers and what not) is structurally risky, it actually increases the risk of something going wrong (aside from it being a moral hazard). (POTUS is an extreme example of this.) The risk is shared (collectively owned, if you will) and so should be the decision-making.
What if over time, the system degrades in such a way that there's a group of people that extract more and more value from the system while adding less and less value themselves?
Is this a possible failure mode of the system?
What sort of symptoms might one look for in a society if we believed this might be happening?
Or do we simply dismiss that this has been proven impossible (as per the theory of Money 101) and move on?
> The owner takes the risk that there is no (or negative) money left over after paying employees and all other costs. As a result, if there is money left over, they get to keep it. I suppose I should remind you that the vast majority of businesses fail. The entire dataset visible to you is imbued with survivorship bias.
Right, and CEOs famously are the first ones laid off when the company is flailing and losing money, because after all, they're the ones at the helm of the ship! And of course when a CEO does leave, they never get a golden parachute.
> Welcome to money 101. This is how all business works everywhere. Nobody thinks that value is created "solely" by the owners. That's a fake strawman.
Sure, but plenty of people think that the way value is distributed today is completely out of proportion to their contributions, and you're presenting it like the current way is the only possible rational way rather than an emergent property of the entirety of human history being an uneven playing field.
In an ideal capitalistic world billionaires are people that provide most value to society, yes. In the real world it’s questionable to say the least because they usually do not do fair win-win business, they do cutthroat “I’m gonna abuse my position to the absolute limit, what are you gonna do about it, you have no other choice” business. People that don’t do that don’t end up billionaires because they can’t compete with those that do.
The definition of „value“ in capitalism is already contentious, so even in idealized capitalism billionaires can provide „value“ that does not align with the „value“ of most of the people.
People are billionaires because they “share with society”.
I appreciate that this is a flippant remark, but there are crypto billionaires proving that there are exceptions to this assertion.
Contributing nothing isn't even the worst case. There are also people who make their fortunes costing society. The Sackler family made insane amounts of wealth as literal serial killers. The CEO of Nestlé make a ton of money killing babies. The folks at DuPont made huge profits knowingly poisoning people (and ultimately the entire planet). Some of the wealthiest individuals are also the most sick and dangerous people who have ever existed and are responsible for incalculable damages to society. The worst part is that they usually bribe their way out of any actual accountability for what they do.
Pro-tip: more often than not people are billionaires because their parent was a billionaire or multi millionaire
Yes, and the contributions from those parents were so valuable that the society still owes them, even long after their death. That's why we pay our dues to their children and grandchildren.
> Yes, and the contributions from those parents were so valuable that the society still owes them, even long after their death. That's why we pay our dues to their children and grandchildren.
You're ascribing a level of agreement with your opinions about who deserves what level of credit people deserve for results that are far beyond the scope of a single person to vast swaths of people who have no power to contest the system that has existed for so long that no one alive created. The reason I "pay my dues" to the grandchildren of random rich people from 100 years ago is not because I owe them but because there's literally nothing I can do to avoid it regardless of how plausible I find the extreme opinion you're confidently asserting is some sort of self-evident fact.
Sorry, why would society owe their children? Where does this obligation come from? You're making a leap here that doesn't make sense.
Also, it's not sharing with society that makes people billionaires, it's taking from society. Had all that profit gone to society, they wouldn't be billionaires. Now often (not always) they provide some value to society but that generates that profit, but quite often even that was based on taking from society. They take natural resources to exploit, monopolise a market, exploit workers, etc.
You might be living inside a philosophy book about capitalism. Do you know about the existence of Russian oligarchs and their offspring? Or Texan billionaires that one day woke up and found out they were living on top of oil? What contribution did they give to society?
Well, I can give you Russian oligarchs - they came to their wealth during time of chaos, and mostly through stealing. But Texan oil billionaires? They won their wealth fair and square, if not for anything else then for just recognizing an opportunity and acting on it. Believe me, there are many people in this world who would blew it in stupid ways.
I won't even argue about Texans even though you're wrong there, but since you accepted Russian oligarchs as a problem with this world view that having money = having contributed to society then I'm not sure what else to say. You already admit this model doesn't work as a proxy to merit in the case of using force and connections.
Take another example, someone who won a lottery vs someone who hasn't, but otherwise lived the same life, in your world view one deserves it and the other doesn't. And their their offspring forever on as well? If you accept this now your list of exceptions is using force, connections and also luck. But we can keep adding examples and exceptions to the rule until at some point you need to admit that way of looking at the world is too flawed, no? BTW this luck aspect is the same as the "Texan got a knock on the door offering them millions forever because they have oil under their house" so I guess I did end up re-arguing that.
That’s actually a pretty good thing. Becoming a multi-millionaire is quite achievable in this country and if that means I provide a compounding ability to my kids to provide a large amount of value to a large amount of people and capture some amount of that, that’s a good thing.
Since 2/3rds of American billionaires are from industry, if it is true that their parents were multi-millionaires, that is wonderful. The fact that children here can take the platforms their parents build them and turn that into great value for the American people is a good thing and one of the reasons I am drawn to this country.
You are drawn to the multi generational accumulation of wealth and power? The societal ill our founders were concerned about that's currently giving us a high grade fever?
Brings to mind a certain creature that thrives in festering wounds.. It's in the tip of my...
Yes, I'd rather people bequeath their wealth and power over the generations than they waste it in purely self-serving ways, such as by buying yet another luxury yacht. Of course many billionaires choose to donate much of their wealth to charitable pursuits as well.
I think this is essentially correct. I'm sorry you're getting downvoted. I think there seems to be a prevailing attitude here (and in the world in general) that making money is 0 sum and you get it by taking taking it from others, rather than the reality (in free-ish, market-ish economies) that most people make money by adding value to other people's lives and being voluntarily paid for that value. Similarly there's a sentiment that policies are bad because billionaires lobby politicians, as opposed to that most people want terrible policies (though the lobbying can definitely be bad).
I guess one important nuace is that it's not all billionaires for whom this is the case. You have lots of Carlos Slim style 'get a government monopoly and collect the rents'. So it's a bit messy.
Almost all billionaires are parasites who don't really "create" anything except figure out ways to either game the money markets or underpay employees.
There's also all the various shenanigans they employ to avoid paying a fair share of tax, so they're mainly "stealing from society".
The level of wealth hoarding by certain people would be classed as a serious mental illness if they were hoarding something else, but it's actually far more damaging to the rest of the world that they hoard wealth.
Billionaires extract a vast amount from the economy and pay a tiny fraction of that back in. It’s not “creating value” to replace millions of middle class retail jobs across the country with tens or hundreds of thousands of largely poverty line jobs and parking the delta in shareholder investment accounts.
Without billionaires, money stays in the community where it circulates (workers and small business owners make money and they spend it). With billionaires it is extracted from the communities and hoarded in investment accounts a thousand miles away.
> People are billionaires because they “share with society”. They take a small fraction of the wealth and surplus they create.
I truly cannot believe that anyone with an ounce of empathy or integrity could possibly believe a statement as absurd as this.
One day it's all going to trickle down, just like they promised us, keep waiting! All that wealth is going to leak through and soak our empty pockets until they are heavy with gold! The Holy Gipper wouldn't lie to us.
My sister in New Zealand uses StarLink because ADSL stopped working in the rural wops.
She gets more utility than she pays for (that's the one trick of capitalism).
Is that trickle down?
I feel bad for your sister. Only one reasonable option for an essential utility and all it costs your sister is hundreds a month plus sending all of her private data to a Nazi billionaire who is using it to train his AI while externalizing the costs of light pollution and space congestion/garbage onto the entire rest of the planet? It's looking like there's more than one trick to capitalism.
Why blame capitalism?
Maybe look for a better word that encompasses other political systems too - power?
There are many examples of surveillance states (and the best known examples were not labeled capitalist).
The surveillance you blame on Musk is the same from other ISPs - therefore your analysis is simply incorrect. She needs a VPN to avoid ISP snooping on the metadata (IP addresses used, DNS, etc).
And the US is a bigger snoop (Echelon, 5 eyes, Room 641A).
Our individual choices are limited in New Zealand (written on an iPhone - far more snoopy than my ISP).
You do realize that any broad-based improvement in overall living standards is a result of exactly that kind of process?
Disbelief rarely alters reality. Eppur si muove.
Stating something as fact doesn’t make it so. :shrug:
Why is this absurd?
Two sorts of people become billionaires from share price increases. The founders and the early investors. Neither are thousands of times more impactful than the other early hires, but they get to keep billions of dollars while the early hires only get a handful of millions. And the slightly-less-early-hires who were too late to get equity usually get nothing more than their salary, regardless of their impact.
I don't have any problem with people getting insanely rich from stock price increases, but the argument that it's society sharing the value they created ignores the fact that they were only responsible for the initial foundations of that value, and not all the work that continues later.
Society shares in the value because - insofar as the company is now worth say $X - that's because they have some way to create value that justifies a price of $Y per year for N people. And for those N people to be willing to pay $Y, they presumably have to be getting more than Y value (otherwise they wouldn't bother). So the real consumer value minus $Y is the 'value' created - the consumer surplus. Obviously there are exceptions but I think this is true in general.
And re the impact of the founders/early investors, I agree that they didn't contribute 1000s of times more. But like, if I bet a million dollars on a sports games and I get bet right and make 5 million would you say I ought to pay the players who really did the work? It's not about "adding value" its about property rights. The the second tier of engineers isn't happy they can (and sometimes do) found a competitor.
> Neither are thousands of times more impactful than the other early hires, but they get to keep billions of dollars while the early hires only get a handful of millions.
That's a meaningful tradeoff of risk vs. return. If you choose to be an early hire rather than founding your own risky venture, that ultimately means you value the security of "only" getting millions over a lottery ticket that might or might not be worth billions.
I guarantee the "median" payout is nowhere near that. The article said the average pay is 158 million won. I bet the median pay is less than half that.
It is the unions not Samsung's generosity; As union membership declines, inequality rises in the US while in Korea they are a force to be taken into consideration.
If you're in manufacturing and have a union in the US, there's a good chance your job just gets shipped overseas unless it's some sort of protected job that can't legally be done overseas (some defense stuff).
You can retire in Korea on 200K after tax?
CoL outside of Seoul is ridiculously cheap
Apparently a single person can live in Busan on 1500 USD per month. 200k buys you 11 years, not accounting for inflation and COL increase.
A 40 year old person can’t retire on that money.
If a person has already made progress on their retirement goals, then an additional 200K can certainly help to reach the goal faster.
That’s trivially true always and everywhere haha
I think if they retire Samsung loses bunch of knowledge that is required for keeping lights up.
I don’t think they will be allowed to retire.
They probably slogged to death before this and finally are recouping what they were owed over their lifetime if you put things into perspective. I feel happy for them and hope they use it wisely and actually retire.
> recouping what they were owed
I’m just a dumb blue collar worker, but I’m going to go with “No” here.
They were only ever owed what they agreed to work for.
Now, that’s changed and they negotiated a different agreement.
They were never owed this until both parties agreed they were.
I don't think it was meant to be taken so literally.
Yeah right. Who knows what anything means any more.
Finally, some feel good news about AI.
From our laid off workers pockets to Samsung employees’!
That seems like false equivalence. The overall economy is not zero sum.
no--i was just making a slightly silly point about tech companies 1) laying off workers and 2) spending that cash on infrastructure (including chips) which goes to 3) Samsung and in this case 4) its workers.
I do wonder if this is good for Korea in the long run. There's not many employers like Samsung and SK that can provide this level of compensation for cost centers. I think many more workers are going to start demanding red carpet treatment when companies are choosing to outright shut down or move operations out of Korea due to increasing pressure from unions. ex) Hanjin, SsangYong Motor, GM, Renault Samsung/Renault Korea, Nestle, Tetra Pak, Hyundai Motor, HomePlus....
It probably is. Sharing in what is essentially a massive windfall is most likely positive. This money will get spend or invested by employees. Which should stimulate the economy at much higher level if it just stayed in stock market.
This is not standard thing. This is response in situation where company has generated massively more profit than any time previously and likely any time in future after market stabilises. Expectation that at least part is shared with employees should not be unreasonable.
It is an abhorrent reflection of the society that this is a valid kneejerk response.
Workers are supposed to always be worried about the overall economy, but companies firing thousands of people can ignore everything that is not related with their revenue/profit. It's hilarious.
I remember when I had these kind of takes. I blindly believed in "equal treatment, including billionaires". Now I get frustrated reading them, but I have empathy from understanding where they come from (for now, at least).
> chip workers
> cost centres
What?
In what way are manufacturing workers a cost centre?
They aren’t call centre workers.
Meanwhile tech workers in the US spend all day online defending billionaires who wouldn't piss on them to put out a fire and arguing about why we can't have unions because blah blah blah rugged individualism.
I find this complaint hard to square when US developers earn "moon money" compared to both: a) fields requiring similar levels of expertise like EE or Mech-E and b) international developers in similar roles. Plus, equity.
[GIF of Woody Harrelson wiping tears with money]
The vast majority of tech workers in the US make nowhere near FAANG-money and have never had meaningful equity.
Also the fact that people in group $X are getting screwed more than people in group $Y is no reason not to fight to not get screwed if you are in group $Y.
Professional athletes and pilots have unions. They both make considerably more than your average programmer, even in FAANG and even with equity.
This leverage all has to do with the product, how close you are to it and how valuable it is. FAANG product is valuable, but the programmers are still just creating it and usually a small part of it at that. Pilots are the product when the product is "get plane to destination" they are the 1 or 2 people providing that product (ok service). Athletes are the product of sports. It's very valuable and there's only a dozen or so of them to deliver.
Now, using the leverage is the difficulty to unionize. Athletes are a tiny group, pretty easy to organize. Pilots are a small group, also pretty easy to unionize. The fact they have to be licensed means there is a record for all the people needed pull in. Software engineers seem to be 5x-20x larger population than commercial pilots (quick/rough searches). They have no certification or registry organization and have no common affiliations. It's incredibly difficult to organize this group. There's also no regulatory capture requiring developers to be US citizens so, if you did unionize and tried to negotiate too hard the industry would just move away from the US so there's just not a lot of leverage this profession has.
Pilots also spend years logging hours in small airplanes, then regional airlines, getting paid relative peanuts, working crazy hours, rarely home, etc. before they land a high-paying job at a major national airline. And any hint of health problems, depression, substance abuse, etc. they fail their medical and it's all gone.
Simply because it's not that easy to offshore them to India.
These "unions" in high paying fields behave more like guilds or cartels than worker's unions - they generally restrict supply. Athletes and Hollywood unions are sort of special cases too, IMHO. I don't think it's reasonable to claim that top earners in those fields earn so much because of their unions - they benefit from natural supply restriction of outliers.
For unions to be as effective in tech as for say pilots or doctors, you'd have to agree on a way to restrict supply (H1B restrictions, more licensing and credentialling etc) to give the union leverage. You have to control the supply taps and rate limit entry to the field.
I think it's hard to say if this would net out better for workers than the current arrangements, which are already the best in the world on nearly every metric.
It also seems like there's a timing issue - if tech workers DID successfully unionise enough to withhold a meaningful fraction of labour, the gains might ultimately end up in the market cap of AI companies via substitution.
I don’t think pilots unions do much to restrict supply.
Structurally the way it works is that the AMA or ALPA or what have you lobby for regulations that just so happen to limit supply, and heavily push back whenever anyone proposes regulations that would loosen it, usually on safety / quality grounds.
There are also revolving doors between the regulator and the relevant professional bodies.
I'm pro union in cases where employers are a monopsony and workers have few options - it completely makes sense for coal miners in a coal town to form a union to even things out. I just don't think US tech right now meets the conditions for it to make sense, the market is too liquid for employers to capture all the upside.
US tech workers have real problems and complaints - PTO, maternity leave, health care to start - but these feel to me more like structural features of the US labour market? It makes more sense to me that these should be subject to national regulation rather than specific advantages for tech workers carved out by a union.
If you wait until you lose your leverage to unionize, you may not get to unionize.
Its very simple. Look at the profit margins of those companies, there's simply a lot more to share.
If you don't need to buy a product to make a product, or when you have to that's typically pennies on the dollar you can share a lot more of that.
The real difference here is that when the market is favorable you CAN share more. And Samsung is doing so. In the US you probably wouldn't be able to do this because the shareholders will cry and will happily give a 100M bonus to whoever will 'lead' the company better. Where better means diverting as much as possible to the shareholders
The US has some of the highest levels of wealth and wage inequality in the developed world, and it's never had greater economic stratification in 1-2 lifetimes.
The number of people making "moon money" is very, very small compared to everyone else in the industry.
Why are you pitting workers against each other?
Developers don't set EE wages. It's always the management class that is the source of your woes, not your fellow workers. We're in this together.
It's not pitting workers against each other to point out that the conclusion of the argument doesn't follow from the premise.
Everyone knows the kindergarten rule on stating an observation: "They who smelt it, dealt it."
The union makes us strong.
-- A proud programming union worker in South Korea since 2018.
What’s an average nvidia “tech employee” worth today? How about compared to their base salary vs. Samsung line workers?
You have a point. But on this precise topic it’s pretty hard to make. A tiny handful of companies who are winners beyond anyone’s expectations simply do not matter.
There is exactly zero percent chance this profit sharing contract would have been negotiated by either party as it is if this had been remotely predicted in advance. Same as the retrospectively extremely lucrative RSUs granted to nvidia employees just five years ago.
Tech folks employed by the top tech companies have been fine. I do not cry even a minute for them. The fun part of the Korean memory worker compensation is that blue collar folks finally are getting just a little bit of the taste the laptop class has been part of for so long. And it is likely to be comparatively very fleeting.
It would be ungrateful to complain after earning enough in stock options and RSU's to retire early.
(It sounds like the union got a great deal for these workers, though.)
are you saying workers should show gratitude to their employers?
Yes, if you're treated well. It was a fair deal. More than fair, generous. I can't point to anything I did that was worth so much.
You seem surprised? Do you know how things (sometimes) work in Silicon Valley?
I feel the opposite. Looking at the yearly revenue of these companies and dividing them by the number of people that contributed, I clearly created much more value than my comp gave me.
Labor is entitled to all it creates.
I learned pretty quickly that money in Silicon Valley has nothing to do with getting what you "deserve" after a co-worker sold a domain name at the height of the dot-com bubble and retired on the proceeds. Sometimes people get lucky and there's no point in getting angry about it.
Do you think it's reasonable Zuckerberg or Bezos get rewarded the way they do while Amazon drivers piss in bottles and barely paid contractors get PTSD from moderating Facebook?
The system is rotten to the core. We as tech workers are somewhere in the middle, simultaneously being exploited while also benefiting from the exploitation of others.
I’ve read news reports about those jobs and they do sound very bad. But as for being exploited, I’m certain that I wasn’t.
Would you rather people not be allowed to do these jobs at all? That wouldn't leave them better off. Even paying them more must necessarily be weighed against the opportunity of expanded hiring at the prevailing market wage, lest you simply create a new privileged high caste of super highly paid Amazon drivers or Facebook content moderators.
I would rather not have people's dignity priced by the market, the same one that created the Zuckerbergs and Sacklers of this world.
Markets are fundamentally just a proxy for the interests of rich people. There can be no fair allocation of resources as long as the mechanism to do so is a figleaf for the oligarchy.
No, despite working there and (apparently) making too much money to complain. Spell it out for us please.
I think I have shown gratitude to all my employers. They have invariably treated me well, and I believe the relationships were mutually beneficial.
If you do not feel gratitude to your employer I suggest you find a different one. If you cannot find such an employer over an extended time frame, perhaps the problem is you.
I disagree.
You can feel a job has been worthwhile, lucrative, satisfying… (mutually beneficial)
But feeling gratitude to an _entity_ that puts profits before your well-being is misplaced. Maybe there are exceptions, but not in big tech.
> Meanwhile tech workers in the US spend all day online defending billionaires
Tech pulled a great trick here: equity.
America as a whole pulled a similar trick: 401k
It’s hard to fight the billionaires when all your money depends on not fighting them.
401(k) and IRA’s were not a gift. It was a way for the companies to end the company pension plans in the early to mid 1980s. Half of the people who did receive them squandered them by cashing out before retirement to pay bills. If Social Security goes the same way most would squander it paying for necessities.
Most of the unionize workers still left in America get a better share of the pie than the non-Union workers not even close. It’s always good to work together in a union had to be footloose and fancy free by yourself.
> 401(k) and IRA’s were not a gift
No not a gift but they sure do align incentives
Are you saying taxing billionaires out of existence would be bad for equity and 401ks? How, exactly?
I don't think it would be bad for equity in any way. It might actually be good instead actually.
First, the general public would have more disposable income if we shift more of the tax burden on the ultra rich.
Second, people like Elon Musk won't be able to give themselves massive bonuses that are essentially paid by diluting common stock.
Also, with regard to the U.S., the U.S. could wipe out its national debt with a one-time wealth tax, and also pass a balanced budget const. amendment so it never ends up deep in debt again.
Lastly, perverse and extremely greed-based exploitative businesses might become less common, since there aren't ultra fat executive paychecks. Although it might still happen if a large group of people are able to make a somewhat high salary off such schemes.
No way wealth tax covers the debt. It would be more of an asset seizure and forced sale or nationalization of a bunch of businesses and illiquid asset classes. The rich don’t hold enough cash to make it happen.
The other issue is the U.S. deficit is a feature not a bug. As long as the world buys the bonds, it’s “free” and no one will care until forced austerity happens.
Look into the end of the Gilded Age to see how this really gets fixed.
Nationalization is arbitrary and wrong. That's not what I'm proposing.
We'd largely be transferring shares in companies to the treasury bond holders, ie the people and orgs who hold US debt.
The federal government might for example force mega-sized private companies like Koch Industries to go public to get an accurate market valuation (or just sell it to private equity by starting a bidding war on it across many private equity investors).
The wealth tax cutoff would be determined by the national debt. It might fall to a relatively harsh / low threshold like 99.9% of assets over $20 million. Or maybe 99% of assets between $20 million to $1 billion, and 99.9% on assets above $1 billion.
Treasury bonds themselves would be subject to the wealth tax, so someone with $100 billion in T bonds might just see 99% of $80 million erased. So even the total number of T bonds payable will drop under this wealth tax.
But someone with $100 million in shares in private and public companies will see their shares transferred to the federal government, and then eventually sold.
Once every T bond has been paid off, Congress and the states could try to close the centuries-long chapter on debt by trying to pass a balanced budget constitutional amendment.
Well yeah America has achieved what the communists sought: public ownership of the means of production . Today most of the American public owns the largest means of production in government advantaged accounts. Marx ought to be proud
Actually, it’s the other way around in America the government and the people get to pay for the debt and the Robber Baron insiders get to scuttle away with the profit.
You can argue it's poorly managed, but the ownership structure is whatever it is.
https://finance.yahoo.com/news/wealthiest-10-americans-own-9...
So basically most older professionals, and today's young professionals will step into their shoes as they grow their wealth over time too. Which means probably far more than 10% of the population will at some point in their life belong to that group which owns 90% of the means of production.
> will at some point in their life belong to that group which owns 90% of the means of production
Would love to but I'm afraid you grossly misunderstand how the power law distribution works. Unfortunately the billionaires are running away from us exponentially faster than we are catching up.
Speaking as someone who will almost certainly become a multi millionaire in the next decade or two. (even if I stop adding more savings manually)
But crucially this only happens if there _isnt_ a big revolution in USA. If there is, I'm fucked.
>Unfortunately the billionaires are running away from us exponentially faster than we are catching up.
Why does that matter? Who is trying to catch up with a billionaire? They are not even playing the same game as the rest of us.
The idea that communism means that everyone owns everything equally is retarded. Communes themselves don't do this. People with more stake get more ownership
This corresponds to the first stage of Marxs theorized progession from capitalism too communism
Done hate the messenger. I'm just taking what I read and applying it to observed reality and telling you it fit.
Self described commies are dumb because they are incapable of enacting the very system they claim to idealize.
Can you show a commune that has lasted 3 generations? So like people move in, they stay and have kids and their kids stay long enough to have kids themselves. So at least about ~50 years?
My impression of all these communes is:
- idealistic people move in
- they realize 90% of the people that moved in are lazy and don't want to work
- the rest of the 10% run the show and the commune either breaks down here or kicks out many people
- kids are born, they grow up and by the time they get to university age they find the whole thing cringy and leave to go have normal lives
- commune ends
Other than some that also degenerate into sexual abuse between members and other weird power games. My impression of these outsider hippie / communist groups is that their failure rate is very high.
The United States, since most of our means of production is owned by the public. That was the point. The United States has the highest equity ownership rate in the world. We all have a stake in this.
That's just an infantile straw man though which has nothing to do with how communism works. Communism simply means that workers own their workplace and are the primary beneficiaries of their labor. In practice this means a mix of state ownership for cross-cutting concerns such as energy production or infrastructure and cooperative ownership for things like light industry. Cooperatives operate exactly the same way as companies owned by capitalists, except workers are in charge of running the company. Huawei is an example of how this works in the real world.
Maybe avoid opining on topics you have no idea in the future as not to make an ass of yourself in public.
I want to smoke what you’re smoking!
I'm just starting from first principles on a debate that has ended up being more about neurological orientation rather than anything substantive.
But no one should argue with this, it is as sound as physics;no unions no equality in salaries https://www.epi.org/news/union-membership-declines-inequalit...
Doesnt need to be tech. My blue collar UPS worker friend is all in on down with regulations, and claimed if anything we meed MORE billionaires. Many in America see regulation and taxes in all forms as bad, and the primary thing holding back prosperity for all.
I remember thinking like this when i was younger (hes older than me). Then here i am working nearly half as many hours as this guy, for 5-10x the pay.
This is a widespread, pervasive train of thought in America. Yet i wonder as the houses and healthcare stay expensive, food and fuel too... at some point this mental model breaks right?
Tech workers get paid in equity and many in the semiconductor industry are making far far more than this a year with all the equity appreciation.
In all honesty, I’d rather get paid the $500k/yr people make here than have a union negotiate a $350k one time bonus in a time of unprecedented success. Given these two options, I’m not that eager to have their system.
$500k/yr? Do you think a lot of people make that much?
While we’re at it I, too, would rather be given $xx billion a month and a pony than be in a union and only get a $350k bonus.
I think I am making a shrewd decision here if my math and equine knowledge holds.
He clearly has a very narrow definition of "here" in mind.
I mean, on levels.fyi the 90th percentile in San Francisco is 500k. Most of HN is tech workers in the bay area.
The average person on hacker news is easily in the 90th percentile of software engineers, so yeah, I wouldn't be surprised if the most people here make somewhere around there.
The biggest confounding factor is the other fact that most HN users are startup founders living off ramen in Peter Thiel's garage, so that probably brings down the average some.
I have a hard time understanding this complaint. A US tech worker earning $340k bonus wouldn't even make news, it happens every year all around the silicon valley.
That is, a US tech worker is taking much more for their own from those billionaire employers, compared to what Samsung's workers managed to do after a lot of haggling.
We’d need to see the payout distribution to know for sure…
Just the average doesn’t say enough.
I mean as someone who works in American AI chip firms , our compensation is larger. You can bitch about America as much as you want but it's pretty much the best in terms of monetary compensation
Of course I'm late to the game. My colleagues who have been here ten years are either extremely wealthy and bored or sailing the Caribbean at this point. Every other week someone is taking a sabbatical
That’s nice for the handful of people in the right place at the right time, I guess…
Yes, just like the Samsung employees we're talking about.
Very true, but some are acting like it’s the end of the world if a few people in the middle to lower end who worked very hard get a bonus and when I say work hard, I would say they probably in South Korea worked a lot harder that many people in the west in the same position have relatively speaking.
I don't think it's much larger when you adjust for Bay Area COL. Housing and healthcare especially.
I don't live in the Bay area. Left many years ago with my stock options and rsus.
Meanwhile, U.S. companies are cutting our already-shitty vacation and leave.
When the government is: of the many, for the few.
This is what bonuses would average out to in the US as well. It’s just that the CEO would get $100 million and the workers maybe $10k each. Does the article say how it’s going to work?
Maybe that’s still what’s happening, they’re talking about average after all :)
Perhaps U.S. workers could threaten to strike as well...
The Molly Maguire‘s lost a long time ago in America, the Goons, Pinkerton’s and the owners saw to that with a little help from the government and the police of course.
Don't be silly, we're all special individuals here and unions are bad! We definitely haven't been brainwashed to act against our best interests.
> Does the article say how it’s going to work?
You pay them the bonus, it shows on the pay cheque, like every salary bonus. What about this is something you'd expect in an article?
The distribution of bonuses instead of an average
I mean how the bonuses are going to be distributed based on hierarchy in the company
Exactly. I came here to say the same thing.
unions work
But who will protect the interests of capital??
Capital, politicians, conservatives, libertarians,
We’ve gotta add American Liberals, majority of Democratic Party to the list. The Sanders faction is unfortunately not yet the prevailing force.
At the very top, yes and unfortunately many workers on both sides of the fence run interference/collaborate for those at the top it’s one of reasons the Molly Maguire‘s never win or rarely win for too long.
Around the world "liberal" is synonymous with "capitalist". US is pretty unique in that it considers liberalism a leftwing ideology
Left/Right alignment is relative, and the American political center is...where it is, and has been drifting rightward since Bill Clinton's "Third Way".
No longer true; the left wing in the U.S. started splitting from the liberals over a decade ago and that's more or less complete at this point.
Yeah for sure, speaking purely on the American common framing of big L Liberals as akin to social liberals rather than classical/economic liberals.
Don't forget liberals too!
But won't somebody think of the robber barons!
I think you mean who will protect the interests of the consumer? That's ultimately who loses to unions. There's no direct ethical value in protecting businesses or their owners but workers and consumers include pretty much all humans and their interests are in tension with each other.
Consumers have a choice of not buying, so generally they do not lose to unions.
mostly the government because the consumer has a lot of democratic power.
product regulations and antitrust as examples
I mean if that is your measure, then consumers lose more to capital than organized labor.
This is wonderful!
Big up for the unions!
Do not get deceived by the average number. I'm pretty sure that most of the money of the total goes to a handful of people, and the small remaining amount will be shared by the rest. Emphasizing the average amount is just their PR strategy.
Nice. Now, the Fortune 500, please.
Samsung chip workers get $340k bonuses. American tech workers get laid off because AI is 'optimizing headcount.' Different kind of AI dividend
These samsung workers are producing the compute that reduces demand for american coders. It's like pointing out that tractor factorymen are getting bonuses while the stable-manager gets laid off. Well of course.
What do you think will happen to these chip workers as their jobs get automated with AI?
That is so far away. There is approximately 0 public training data for chip design. Just try asking an LLM to design hardware, it's laughable
EDIT: just realized I'm not sure what a "chip worker" in this article is. Someone doing digital design? Someone working in the fab? Hmm
Next post will detail a 300 percent increase in chip workers LOL
They would, if they could! Starting new chip fabs is not that easy.
And, soon someone will come along claiming unions and strikes don’t work. /s
Any bonus is better than no bonus but averages are deceiving. Maybe VPs would get 10m and line workers 10k ¯\_(ツ)_/¯
My understanding of the article is that it affects actual chip workers, since it’s the union of those workers that will be affected.
Is your understanding that the VPs are in the same union as the line workers? That would be... interesting. I do not believe that is the case.
right here in good ol USA, workers are getting laid off. Plenty of folks will be happy without a bonus right now if they could just have a job.
Yeah give me the median
Not all workers will fare equally. As an illustration, Reuters cited a union source estimating that someone in the memory chip unit earning an 80-million-won base salary could take home roughly 626 million won in total bonuses this year. By comparison, workers at SK Hynix stand to collect upward of 700 million won should their employer post annual profit of 250 trillion won, Reuters calculated. Unlike at Samsung, SK Hynix employees are not limited to stock payouts and may instead opt for cash, Reuters reported.
Almost 6x the base, not bad.
They probably had to fight hard to get it and stick together…
So does Samsung have a union?
How about TSMC or ASML?
> So does Samsung have a union?
Are you being sarcastic?
It's literally mentioned in the first sentence of the article, as well as the subheading.
I'm never a big fan of Samsung haha. I'm more like a fan of Google as hardware