5 ms·

Historically, unions have been very antagonistic to capital. Paul Graham is basically the definition of capital; he uses his wealth to generate more wealth. And

Historically, unions have been very antagonistic to capital. Paul Graham is basically the definition of capital; he uses his wealth to generate more wealth. And what he is suggesting is that startups could fix the inefficiencies in the market that unions have created. The problem is that fixing these inefficiencies would primarily benefit people like PG, who make their money from the ownership of enterprises rather than labor. Generally speaking, the inefficiencies of unions exist to protect the interests of the workers, who generate wealth for the company but more often than not do not have an equity stake in the business. Unions exist to maintain the balance between capital and labor, and to make sure that people like PG don't deprive the laborers of fair remuneration for their work. While we can almost always find someone who will do a job for less money, as a society we have an interest in providing an equitable share to labor, as there are far more workers driving this global economy than there are venture capitalists (or even just plain old capitalists) contributing to the economy in the form of seed round funding and the like.

sokoloff 11y ago
My experience suggests that the inefficiencies of the unions exist to protect the interests of the unions. Where the workers are also helped, that seems almost incidental in practice.
- vacri 11y ago
  Corrupt unions are a problem, however corrupt unions are still better than no unions. Edit: to the downvoters: consider what life was like for workers before unions were widespread.
  - krschultz 11y ago
    For some people. Within the union some members benefit and some members lose relative to individual bargaining. Generally speaking unions base compensation heavily on seniority rather than productivity. That really screws the young, the hard working, and those with the most initiative. I think the net result is a greater share of the profits for labor, but there are definitely some people in unions getting totally screwed by the unions.
    - vacri 11y ago
      It's still better than no unions. Similarly, unions don't just do paypackets, they also do things like check OH&S conditions. And from experience, at the low end of town, the young, the hardworking, and those with the most initiative are screwed by capital anyway. You don't get extra money in your paypacket for being a hardworking or initiative-showing bus driver or call-center operator.
      - krschultz 11y ago
        In some cases yes, in some cases no. The CAD draftsmen at one of the companies I worked at were in the UAW. The older guys made a boatload of money while the young guys barely made made more than minimum wage. On an open market the managers would have happily paid the young guys 2-3x as much for their work, but that wasn't an option. OH&S wasn't all that important since we're talking about a desk job.
  - prawn 11y ago
    I've often wondered how much of the potential corruption in unions could be minimised through a membership app. Try to take some of the responsibilities away from people in organisational roles.
supster 11y ago
> Generally speaking, the inefficiencies of unions exist to protect the interests of the workers, who generate wealth for the company but more often than not do not have an equity stake in the business. What if we paid workers meaningful amounts of equity? Would that perhaps reduce the need for unions bc the labor/capital divide starts to get blurred and then workers are able to share in the wealth they generate for companies?
- diyorgasms 11y ago
  This is a complex issue well outside of my personal areas of expertise, but I would certainly think that workers earning meaningful equity would induce them to act in the best interestes of the company, because their own interests would be better aligned with the company's interests.
- jrowley 11y ago
  > What if we paid workers meaningful amounts of equity? How would you provide equity for public school teachers?
  - supster 11y ago
    That's a great point. Maybe we should view the issue from two perspectives: 1) unions for government employees and 2) unions for corporate employees. Where maybe the solution for corporate employees is more equity compensation, and for gov't employees a formal union system makes sense. Though some have argued that perhaps the gov't should not be in the business of education, and perhaps encourage a voucher system instead.
    - Zach_the_Lizard 11y ago
      In some ways public sector unions are worse than private sector unions. In the private sector, the stakes are higher; you can contribute to the bankruptcy of your company if you are too aggressive. You also can only negotiate with the company itself. Maybe you can get a boycott of products in some cases. With public sector unions, bankruptcy is very hard to achieve. The union also isn't negotiating with the government agency; it's negotiating with politicians as well, who have aims other than efficiency. They want to get elected. If enough of your constituency is in the relevant union, there's going to be pressure to not negotiate as hard. Look at e.g. public transit unions. The DC Metro is falling apart, station managers sleep at work, escalators don't work ludicrously often, repairs are shoddy, and the drivers aren't terribly good at driving their trains (seriously, since they disabled computer control it's started giving me motion sickness; I have never experienced this on other transit systems). Yet the union is asking for a raise.
6502nerdface 11y ago
> [...] he is suggesting is that startups could fix the inefficiencies in the market that unions have created. The problem is that fixing these inefficiencies would primarily benefit people like PG[...] And perhaps the customers of the industry? Edit: My point is that, assuming there are inefficiencies created by unions in a given market (as the parent does), then correcting those inefficiencies would be a positive externality for the market at large, i.e., it would benefit more than just the specific company or investors.
- EliRivers 11y ago
  Doubt it. Why would I give the customers a better deal when I could just take that money for myself? If I was the kind of guy who wanted to give the customers a better deal, I wouldn't be screwing over my employees.
  - jdminhbg 11y ago
    > Why would I give the customers a better deal when I could just take that money for myself? Barring a monopoly situation, this isn't a choice you get to make.
    - EliRivers 11y ago
      I wish I lived in this bizarre world of yours in which economics is a kind of frictionless, perfect implementation of a primary school level of economics. Sadly, I live in a world in which companies that do not have monopolies nonetheless don't make zero profit. Put down your happy-clappy-valley economic religion and look out of the window.
serge2k 11y ago
Inefficiencies like paying people a living wage and giving them reasonable benefits?
- diyorgasms 11y ago
  Yes, in my response I am trying to be as explicit as possible in saying that I think these inefficiencies are a net good. However, they are still inefficiencies. There will almost always be somebody willing to work for less, and things like union protection keep that from happening. The result is a net positive for the workers. However, that doesn't stop the process from being economically inefficient.
  - calibraxis 11y ago
    Corporations also have inefficiencies, because they’re biased against tech which happens to empower workers and removes management layers. (They prefer to deskill labor to be replaceable cogs. David Noble wrote about this.)
- e12e 11y ago
  Don't forget that wasting money on management is good, while wasting money on mere employees is bad. This has nothing to do with managers having an artificially strong negotiating position (they don't after all, generally produce anything) -- while individual employees have an artificially weak bargaining position (they do in general create the major value for any company). It's sad that union has such a bad rep in the US. I'm not sure if that has more to do with right wing politicians colluding with organized crime to disrupt and discredit unions, or if there really are issues with unions in the US in general. My limited reading implies unions in the US are generally a net good for society. Then again, it's hard to discuss sane labour practices in a country where a number of states practice at-will employment. It's so far distant from the work market in Norway that I have a difficult time trying to relate.
- rch 11y ago
  Unions and the lawyers who negotiate with them are actual inefficiencies, and they are both the inevitable result of exploitive business practices. Providing a better outcome without the intermediaries would be a great way to improve the system.
horofox 11y ago
I share the same opinion and congratulations for tailoring this great piece of rationality you wrote. But I think PG isn't bad. I think he mostly want to do good things and thing well of him, just as all the other venture capitalists that back his incubated companies. But they rarely get how hard life is for most of the people. They were born in the land with the most opportunities, and/or studied to be in the field with the most growth in the last decades by far(technology)... and they don't get it. I actually miss the time he was just a computer programmer, he wrote cool stuff. Now, it seems everything to be about making a dent(5-7%) in the universe. Everything is about money. Money. Money. I seriously see no value in making taxists make less money than they already do, or completely "disrupting" markets where the workers, the poor, end up having shittier lifes because all of that venture capital injected to a competitor just across the street. But well, history will tell if this was right or not. I'm just a man who can barely come up with a concise though as you.
deleted 11y ago
[deleted]
cs702 11y ago
Unions are also formed to prevent large corporations from colluding to keep labor costs artificially low. (Yes, large corporations do that. Recent example: leading technology companies in Silicon Valley who colluded for years not to poach employees from each other, keeping compensation lower than it would have been if there had been true competition for employees.[1]) [1] https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...
forrestthewoods 11y ago
Union serve to benefit the people running the union. The actual union members are all too often left out.
federicobond 11y ago
I also have no idea how you reach the conclusion that capitalists are the most benefited from it, but I guess it comes from the old labor-capital analytical framework. You completely ignore the benefits of less intrusive unions to consumers which, at least to me, seem to be the most obvious ones. "We can almost always find someone who will do a job for less money". Where does this come from? Try hiring someone equally capable for half the salary you are paying now.
BurningFrog 11y ago
> While we can almost always find someone who will do a job for less money Why not let that person have the job? That's probably the poorest person, who needs it the most.
- diyorgasms 11y ago
  > Why not let that person have the job? For the same reason we have minimum wage laws. Pitting workers against each other in a race to the bottom leads to unsustainably, exploitatively low wages.
polemic 11y ago
Of course, technology gives capital a way to replace labour, which I assume is PG's fundamental point. At some point, the value of labour will have to be decoupled from remuneration almost entirely. As a society need to re-adjust our thinking on the meaning of welfare, quality of living and the value of work. I do wonder, if wealth were more equally distributed, whether we'd already be in a post-scarcity economy, at least in the developed nations.
marincounty 11y ago
Why do I feel PG was drunk Trittering when he hit those keys on a late Friday? Two, or five glasses of buttery Chardonnay, "I have a brilliant idea!" We all had that idea. Going non-union is nothing new. I've seen, and worked non-union all my life. Owning a non-union shop is nothing to be proud of, and your employees are always looking to get some gravy. That is--the one's who realize they are being exploited. Again his statement is old news, and you can decimate some unions in some counties. Strong unions, like most San Francisco unions will be a tough nut to crack. Unions in San Francisco stick together. I have seen entire buildings empty out over a union painters strike. Rebublicans have tried to stifle unions as long as I can remember. I don't know of a business that doesn't fear unions. Why did a wealthy tech boy say something like it was a new idea? He was under the influence of God's nectar, or he isn't as clever, as I thought? Yea, he's a great programmer, and a seemingly great businessman. Or, is he just a great programmer, who was first to this second/third tech investment table? No matter what he is, I'm back to thinking tech is really in a bubble. It's funny how little I needed to change my mind. While we are speaking our inner thoughts out loud, let's go for it: Let's decimate all Union. Get that county judge down to minimum wage.(Don't worry about graft?) Get that cop down to minimum wage. (Yes, there would still be yahoo's that would do that job for free. Why? We all know why?) Get rid of all Union construction jobs. (We are close to being there already.) Why date, or marry locally? You could buy cheaper love in another country. A country that doesn't have Union expectations. Imagine a husband that will do whatever you tell him to do? He hasn't been ruined by a union? He doesn't expect much? Love is a union--right? Let's break it up. Let's build everything in the cheapest country. (We already do that.) Let's get rid of any profession that relies on tips. I honestly never liked being served, nor helped by that phoney tip seeking behavior. I'm just being honest. I can get my own food. I can open my own door. I don't want someone parking my car. This trend I like, but a higher minimum wage might stop the need for tipping? Let's finally decimate the middle class! Yea, my app will do it, and we have enough people who don't mind sleeping four to a 10' X 10' room? They just want a little money to survive? And maybe buy one of our toys? Or, maybe none of our toys? It's all cute when your standing on the full wine barrel, but God help us when we turn into Mexico. Where, if you have a few assets, and some pocket change, you can't even enjoy a dinner out. You can't take a stroll in the local park. Constantly fearing a kidnapping. Fearing for your children's safety. Fearing life? By the way, I've know too many former Programmers who are now homeless. A few years ago I thought it was just a statical, local fluke. I don't believe it was a cluster. I honestly think Programmers could unionize in The Bay Area? There's a reason your boss wants to live here. It would be an incredibly hard Union to get into, but if done right; you guys would be set for life? I've been in good unions. Not all Union members are paid the same (some members work one day, and are let go). There's no law, that I know of, that would prevent profit sharing for individual union members. Maybe it's time? Forget about the free food--Don't you want normal hours, and some pension guarantees? Again, this fictional Union would have to be set up by the best Programners out there, and some charismatic organizers. It would be an exclusive Union. A union that was different than any Union I'm aware of. The time has come? Or, do we need to let them waste more money on some ridiculous start-ups--essentially Rich boy gambling? Make them pay for the better Programmers? Yea, they might go off shore, but they will never get originality American's bring to the table?

sokoloff 11y ago

My experience suggests that the inefficiencies of the unions exist to protect the interests of the unions. Where the workers are also helped, that seems almost incidental in practice.

vacri 11y ago
Corrupt unions are a problem, however corrupt unions are still better than no unions. Edit: to the downvoters: consider what life was like for workers before unions were widespread.
- krschultz 11y ago
  For some people. Within the union some members benefit and some members lose relative to individual bargaining. Generally speaking unions base compensation heavily on seniority rather than productivity. That really screws the young, the hard working, and those with the most initiative. I think the net result is a greater share of the profits for labor, but there are definitely some people in unions getting totally screwed by the unions.
  - vacri 11y ago
    It's still better than no unions. Similarly, unions don't just do paypackets, they also do things like check OH&S conditions. And from experience, at the low end of town, the young, the hardworking, and those with the most initiative are screwed by capital anyway. You don't get extra money in your paypacket for being a hardworking or initiative-showing bus driver or call-center operator.
    - krschultz 11y ago
      In some cases yes, in some cases no. The CAD draftsmen at one of the companies I worked at were in the UAW. The older guys made a boatload of money while the young guys barely made made more than minimum wage. On an open market the managers would have happily paid the young guys 2-3x as much for their work, but that wasn't an option. OH&S wasn't all that important since we're talking about a desk job.
- prawn 11y ago
  I've often wondered how much of the potential corruption in unions could be minimised through a membership app. Try to take some of the responsibilities away from people in organisational roles.

supster 11y ago

> Generally speaking, the inefficiencies of unions exist to protect the interests of the workers, who generate wealth for the company but more often than not do not have an equity stake in the business. What if we paid workers meaningful amounts of equity? Would that perhaps reduce the need for unions bc the labor/capital divide starts to get blurred and then workers are able to share in the wealth they generate for companies?

diyorgasms 11y ago
This is a complex issue well outside of my personal areas of expertise, but I would certainly think that workers earning meaningful equity would induce them to act in the best interestes of the company, because their own interests would be better aligned with the company's interests.
jrowley 11y ago
> What if we paid workers meaningful amounts of equity? How would you provide equity for public school teachers?
- supster 11y ago
  That's a great point. Maybe we should view the issue from two perspectives: 1) unions for government employees and 2) unions for corporate employees. Where maybe the solution for corporate employees is more equity compensation, and for gov't employees a formal union system makes sense. Though some have argued that perhaps the gov't should not be in the business of education, and perhaps encourage a voucher system instead.
  - Zach_the_Lizard 11y ago
    In some ways public sector unions are worse than private sector unions. In the private sector, the stakes are higher; you can contribute to the bankruptcy of your company if you are too aggressive. You also can only negotiate with the company itself. Maybe you can get a boycott of products in some cases. With public sector unions, bankruptcy is very hard to achieve. The union also isn't negotiating with the government agency; it's negotiating with politicians as well, who have aims other than efficiency. They want to get elected. If enough of your constituency is in the relevant union, there's going to be pressure to not negotiate as hard. Look at e.g. public transit unions. The DC Metro is falling apart, station managers sleep at work, escalators don't work ludicrously often, repairs are shoddy, and the drivers aren't terribly good at driving their trains (seriously, since they disabled computer control it's started giving me motion sickness; I have never experienced this on other transit systems). Yet the union is asking for a raise.

6502nerdface 11y ago

> [...] he is suggesting is that startups could fix the inefficiencies in the market that unions have created. The problem is that fixing these inefficiencies would primarily benefit people like PG[...] And perhaps the customers of the industry? Edit: My point is that, assuming there are inefficiencies created by unions in a given market (as the parent does), then correcting those inefficiencies would be a positive externality for the market at large, i.e., it would benefit more than just the specific company or investors.

EliRivers 11y ago
Doubt it. Why would I give the customers a better deal when I could just take that money for myself? If I was the kind of guy who wanted to give the customers a better deal, I wouldn't be screwing over my employees.
- jdminhbg 11y ago
  > Why would I give the customers a better deal when I could just take that money for myself? Barring a monopoly situation, this isn't a choice you get to make.
  - EliRivers 11y ago
    I wish I lived in this bizarre world of yours in which economics is a kind of frictionless, perfect implementation of a primary school level of economics. Sadly, I live in a world in which companies that do not have monopolies nonetheless don't make zero profit. Put down your happy-clappy-valley economic religion and look out of the window.

serge2k 11y ago

Inefficiencies like paying people a living wage and giving them reasonable benefits?

diyorgasms 11y ago
Yes, in my response I am trying to be as explicit as possible in saying that I think these inefficiencies are a net good. However, they are still inefficiencies. There will almost always be somebody willing to work for less, and things like union protection keep that from happening. The result is a net positive for the workers. However, that doesn't stop the process from being economically inefficient.
- calibraxis 11y ago
  Corporations also have inefficiencies, because they’re biased against tech which happens to empower workers and removes management layers. (They prefer to deskill labor to be replaceable cogs. David Noble wrote about this.)
e12e 11y ago
Don't forget that wasting money on management is good, while wasting money on mere employees is bad. This has nothing to do with managers having an artificially strong negotiating position (they don't after all, generally produce anything) -- while individual employees have an artificially weak bargaining position (they do in general create the major value for any company). It's sad that union has such a bad rep in the US. I'm not sure if that has more to do with right wing politicians colluding with organized crime to disrupt and discredit unions, or if there really are issues with unions in the US in general. My limited reading implies unions in the US are generally a net good for society. Then again, it's hard to discuss sane labour practices in a country where a number of states practice at-will employment. It's so far distant from the work market in Norway that I have a difficult time trying to relate.
rch 11y ago
Unions and the lawyers who negotiate with them are actual inefficiencies, and they are both the inevitable result of exploitive business practices. Providing a better outcome without the intermediaries would be a great way to improve the system.

horofox 11y ago

I share the same opinion and congratulations for tailoring this great piece of rationality you wrote. But I think PG isn't bad. I think he mostly want to do good things and thing well of him, just as all the other venture capitalists that back his incubated companies. But they rarely get how hard life is for most of the people. They were born in the land with the most opportunities, and/or studied to be in the field with the most growth in the last decades by far(technology)... and they don't get it. I actually miss the time he was just a computer programmer, he wrote cool stuff. Now, it seems everything to be about making a dent(5-7%) in the universe. Everything is about money. Money. Money. I seriously see no value in making taxists make less money than they already do, or completely "disrupting" markets where the workers, the poor, end up having shittier lifes because all of that venture capital injected to a competitor just across the street. But well, history will tell if this was right or not. I'm just a man who can barely come up with a concise though as you.

deleted 11y ago

[deleted]

cs702 11y ago

Unions are also formed to prevent large corporations from colluding to keep labor costs artificially low. (Yes, large corporations do that. Recent example: leading technology companies in Silicon Valley who colluded for years not to poach employees from each other, keeping compensation lower than it would have been if there had been true competition for employees.[1]) [1] https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_Litigation https://en.wikipedia.org/wiki/High-Tech_Employee_Antitrust_L...

forrestthewoods 11y ago

Union serve to benefit the people running the union. The actual union members are all too often left out.

federicobond 11y ago

I also have no idea how you reach the conclusion that capitalists are the most benefited from it, but I guess it comes from the old labor-capital analytical framework. You completely ignore the benefits of less intrusive unions to consumers which, at least to me, seem to be the most obvious ones. "We can almost always find someone who will do a job for less money". Where does this come from? Try hiring someone equally capable for half the salary you are paying now.

BurningFrog 11y ago

> While we can almost always find someone who will do a job for less money Why not let that person have the job? That's probably the poorest person, who needs it the most.

diyorgasms 11y ago
> Why not let that person have the job? For the same reason we have minimum wage laws. Pitting workers against each other in a race to the bottom leads to unsustainably, exploitatively low wages.

polemic 11y ago

Of course, technology gives capital a way to replace labour, which I assume is PG's fundamental point. At some point, the value of labour will have to be decoupled from remuneration almost entirely. As a society need to re-adjust our thinking on the meaning of welfare, quality of living and the value of work. I do wonder, if wealth were more equally distributed, whether we'd already be in a post-scarcity economy, at least in the developed nations.

marincounty 11y ago

Why do I feel PG was drunk Trittering when he hit those keys on a late Friday? Two, or five glasses of buttery Chardonnay, "I have a brilliant idea!" We all had that idea. Going non-union is nothing new. I've seen, and worked non-union all my life. Owning a non-union shop is nothing to be proud of, and your employees are always looking to get some gravy. That is--the one's who realize they are being exploited. Again his statement is old news, and you can decimate some unions in some counties. Strong unions, like most San Francisco unions will be a tough nut to crack. Unions in San Francisco stick together. I have seen entire buildings empty out over a union painters strike. Rebublicans have tried to stifle unions as long as I can remember. I don't know of a business that doesn't fear unions. Why did a wealthy tech boy say something like it was a new idea? He was under the influence of God's nectar, or he isn't as clever, as I thought? Yea, he's a great programmer, and a seemingly great businessman. Or, is he just a great programmer, who was first to this second/third tech investment table? No matter what he is, I'm back to thinking tech is really in a bubble. It's funny how little I needed to change my mind. While we are speaking our inner thoughts out loud, let's go for it: Let's decimate all Union. Get that county judge down to minimum wage.(Don't worry about graft?) Get that cop down to minimum wage. (Yes, there would still be yahoo's that would do that job for free. Why? We all know why?) Get rid of all Union construction jobs. (We are close to being there already.) Why date, or marry locally? You could buy cheaper love in another country. A country that doesn't have Union expectations. Imagine a husband that will do whatever you tell him to do? He hasn't been ruined by a union? He doesn't expect much? Love is a union--right? Let's break it up. Let's build everything in the cheapest country. (We already do that.) Let's get rid of any profession that relies on tips. I honestly never liked being served, nor helped by that phoney tip seeking behavior. I'm just being honest. I can get my own food. I can open my own door. I don't want someone parking my car. This trend I like, but a higher minimum wage might stop the need for tipping? Let's finally decimate the middle class! Yea, my app will do it, and we have enough people who don't mind sleeping four to a 10' X 10' room? They just want a little money to survive? And maybe buy one of our toys? Or, maybe none of our toys? It's all cute when your standing on the full wine barrel, but God help us when we turn into Mexico. Where, if you have a few assets, and some pocket change, you can't even enjoy a dinner out. You can't take a stroll in the local park. Constantly fearing a kidnapping. Fearing for your children's safety. Fearing life? By the way, I've know too many former Programmers who are now homeless. A few years ago I thought it was just a statical, local fluke. I don't believe it was a cluster. I honestly think Programmers could unionize in The Bay Area? There's a reason your boss wants to live here. It would be an incredibly hard Union to get into, but if done right; you guys would be set for life? I've been in good unions. Not all Union members are paid the same (some members work one day, and are let go). There's no law, that I know of, that would prevent profit sharing for individual union members. Maybe it's time? Forget about the free food--Don't you want normal hours, and some pension guarantees? Again, this fictional Union would have to be set up by the best Programners out there, and some charismatic organizers. It would be an exclusive Union. A union that was different than any Union I'm aware of. The time has come? Or, do we need to let them waste more money on some ridiculous start-ups--essentially Rich boy gambling? Make them pay for the better Programmers? Yea, they might go off shore, but they will never get originality American's bring to the table?