8 ms·

A Response to Paul Graham's “How to Make Wealth” (2012)

79 points by jimsojim 10y ago

jstanley 10y ago
> Graham’s understanding of economics is woefully pedestrian, un-researched conjecture. His conceptualization of the economics of exchange relies on a stubborn insistence and blind naive trust that the free market is the ultimate solution to which his audience must subscribe. It is distressing that one could allow arrogance to so cloud his judgment that he would embarrass himself by making such claims in an area of study he is clearly lacking any authority on which to speak. The author sounds rather more arrogant than Paul Graham did. And free markets are the ultimate solution. EDIT: The more I read, the more ridiculous it gets. The author takes something that Paul Graham said, throws away all of the context, and attacks it as a strawman. The article seems more keen on attacking Paul Graham than making any actual point. It is also written in a very verbose style that makes it hard to follow whatever argument might be present.
- aleksei 10y ago
  > And free markets are the ultimate solution. On the subject of arrogance, spoken like a true believer.. There is hardly ever an ultimate solution to anything, and to take an extreme position on matters is almost always harmful. Things are never simply black and white.
  - bko 10y ago
    Not the OP, but I think belief in free markets is not arrogant. In a free market, decisions are made on an individual level with actors affected that know their preferences and needs much better than a central body. I think its more arrogant to suggest that some planning committee would be able to make better decisions for that individual. Of course there are instances where there exists knowledge imbalances and sub-optimal decisions can be made. But the alternative is often no better due to the agency problem of having someone make decisions on your behalf
    - amelius 10y ago
      > In a free market, decisions are made on an individual level with actors affected that know their preferences and needs much better than a central body. The free market is a lot like a mosh pit. Everybody is free to move (in principle), but in the end some may get seriously injured.
      - bko 10y ago
        You have to compare that to the alternative. Yes, some people will make less than optimal decisions, but the alternative is not perfect
        amelius 10y ago
        The alternative is that a regulator puts some safety measures in place, like some fences here and there, and emergency exits. The result may not be perfect, but overall it's a better place to find yourself in.
    - stymaar 10y ago
      > I think its more arrogant to suggest that some planning committee would be able to make better decisions for that individual. Objecting against the free market illusion is not advocating for a planification entity. Free market is a fallacy because there is no such things in the real world. Studying economics with the perspective of free market is like studying mecanics assuming mass-less bodies. It might offer a nice framework (the math becomes really simple) in which most of the problem we face disapear (no inertia, flying cars \o/), but that gives you no help if you want to understand and fix the world we live in. In practice nobody is even really trying to make free market a thing, otherwise you would see politician advocating for bans on price discrimination and investor would stop asking founders what are the barrier that prevents their competitors to get in their market, because both price discrimination and barrier to entries are responsible for «market failures». Is communism/economic planning a good idea ? Of course not. Is free market salvation ? Nope. Hayek had a really good diagnostic of the drawbacks of communism, but he had a totally irrational faith in the free market and this vision is shared by too many people. Unfortunately irrational faith does more harm than good …
  - ArkyBeagle 10y ago
    Free markets are a useful fiction that was developed around the time of Adam Smith. They are ( I think, anyway ) a demonstrable improvement over mercantilism. We more or less know how, and we more or less know why. The problem with "things that are not free markets" is that we simply know very little about those things, and the learning curve is significant. USAian bulk crops agriculture is not a free market, it mostly seems to work well that way but it started under FDR and only reached its present form after decades of tweaking. In effect ( the theory goes that ) larger price uncertainties will create price instabilities that, net-net, add more inefficiency than pricing things a skosh higher and accommodating overproduction. As political speech, the term "free market" has been rendered threadbare. "Trade agreements" seem to mostly be more akin to Mercantilism than free markets, and so on.
- czep 10y ago
  The author, arrogant and verbose though he may be, takes issue with Graham's casual assertion that the best hackers are libertarians, and attempts to deconstrust the psychology underlying this connection. What's so illustrative is how Graham inspires his followers to believe the way he does in order to justify and perpetuate his own wealth. The money quote in my mind is: > It is amazing how well this piece serves as marketing fodder for Graham’s venture capital arm, Y Combinator. His business model relies on convincing hordes of eager young hackers to sign over their surplus labor to his investors. With logic crafted to appeal directly to the introverted minds of recent computer science graduates, he has no shortage of cannon fodder lining up on his doorstep willing to eat Ramen and gleefully line the coffers of his investor’s portfolios.
  - jstanley 10y ago
    But many of the best programmers are libertarians. At a much higher proportion than in the general population, from my (admittedly not well-recorded) observations.
    - czep 10y ago
      I looked at this very question with the help of the General Social Survey. I found that software engineers tend to hold more extreme political views than the average for the population, but it was equally split leaning to the far right as to the far left. It was a significant effect, but not terribly strong (i.e. just a few percentage points in either direction). Of course, the GSS can't tell you who are the "best" programmers.
      - jstanley 10y ago
        Do you think libertarians are far right or far left? Because I subscribe to something more like this: http://www.littlecamels.com/files/PoliticalCross.jpg http://www.littlecamels.com/files/PoliticalCross.jpg Where libertarianism is on a separate axis to the usual left/right.
        10y ago
- wavefunction 10y ago
  Free markets are an unattainable Platonic ideal. Just like perfect Communism, it all begins to get messy and come apart at the seams when you introduce theory to the real world and allow fully emotional, non-market-rational humans as the free agents.
- pja 10y ago
  And free markets are the ultimate solution. Ultimate solution to what? There’s an entire field of economics dedicated to the way free markets can fail to allocate resources efficiently, even when the participants are free agents acting without external constraints. Do you think this work is false? Or do you believe that the inefficient allocation of resources is an acceptable price to pay, because “free markets” are more important than outcomes?
leereeves 10y ago
> In a perfectly libertarian society, the bullies would not only take your lunch money, they would murder your family, burn your house, and leave you for dead by the side of the road. What brand of libertarianism is the author talking about here? That sounds like anarchy, not libertarianism.
- philipov 10y ago
  That sentence is saying that a perfectly libertarian society is an anarchy, where might (market) makes right.
  - deleted 10y ago
    [deleted]
  - bko 10y ago
    > Libertarians share a skepticism of authority and maintain that the power of the state has to be limited or eliminated in order to protect individuals from the arbitrary exercise of authority. [0] I think most would agree that "arbitrary exercises of power" would include murder and arson. The author really does his argument injustice by throwing around a caricature of a political philosophy. [0] https://en.wikipedia.org/wiki/Libertarianism https://en.wikipedia.org/wiki/Libertarianism
    - foldr 10y ago
      "Minimal state" varieties of Libertarianism tend to be internally inconsistent, though. You can't say that taxation is theft and then say, ah yes, but we do actually need a little bit of taxation to fund the police and the judiciary.
      - bko 10y ago
        Agree there are some inconsistencies regarding taxation and the minimal services that the government should perform. However, I would note that the primary tenant of the philosophy is liberty, both economic and personal. This liberty would include property rights, which includes ones person. Ideally, there would be a choice of governing associations that one can choose from for police or judiciary, although I see how this can be impractical in practice. This already exists in the sense that one is free to move to different cities/states but due to the expansion of the role the federal government, this distinction has been made less relevant.
dongslol 10y ago
"There are so many problems with Graham’s thinking that it is difficult to organize a focused response." Statements like these are pointless theatrics. The more wrong someone is, the easier, not harder it is to point out where and how. What's the argument? You have to wait until section 2 to find one: "...there are actually several critical errors in the above reasoning which render Graham’s conclusions baseless. The first is the idea that measurement of things like quality and success can be objective, perfect and fair. These are not objective facts, they are highly contextual and can be manipulated by power struggles, charisma, clever marketing, or outright fraud. Value is a social construct..." After about eight paragraphs about how "pedestrian" PG is, his point (finally) is basically that value is subjective and immeasurable. I don't know how true this is philosophically, but for all intents and purposes, if it were true, it would mean that nothing could be better than anything else. [1] It's also a conflation of ideas. Marketing doesn't create value; it distributes and sells it. Value as defined in the original essay is the meaty stuff people want: a home computer, for example, or an affordable spaceship. "Graham identifies that “Many of the employees (e.g. the people in the mailroom or the personnel department) work at one remove from the actual making of stuff.” So what exactly do they contribute to the wealth generation process? Does Graham imply that without these others working at “one remove”, the programmers could still create the wealth they do? Without the human resources team to coordinate their medical benefits, would the programmers be as productive? Without the legal team to fend off frivolous lawsuits brought by patent trolls [...]?" (And so on.) All Graham is saying is that programmers are directly involved in the creation of the product itself — its design, engineering, and maintenance. Other people create the social environment that makes it possible for this product to be distributed and not be killed, but don't make stuff in the artisanal sense. I can understand why it would be insulting if someone claimed that anyone who isn't a maker were somehow useless, but Graham never did. I'm ten minutes in, and everything I've read is basically a verbose form of "it's all relative" and "things are more complicated than that." Philosophy has a standard refutation to this: we deal with complex phenomena by isolating principles. For example, the abstract idea of value, the distinction between creation and distribution, and so on. It's the most boring thing in the world to hear, "the universe is more complex than that idea captures." All abstractions are reductions. This sort of argument based on moral outrage and authority about how the real world works holds back truthseeking discourse. [1] I also have a hard time understanding how someone who has earnestly tried to make good things could want this to be true.
euwhr132 10y ago
Meh. There might be logical errors in Graham's essay, but this just looks like an angry and forceful attempt to rebut his ideas because the author doesn't agree with ideas of free market economics etc. And secondly, I know this isn't the main point but, these "introversion explanations" are annoying and likely part of the reason the industry has problems with diversity. Looks to me like a lot of the people in the industry want to constantly propagate the idea that "the programmer" or "we the programmers" are utopian introvert nerds to anyone who would listen. Got me avoiding talking about what I do so I can have normal conversations about sports and politics with people working outside tech.
- specialist 10y ago
  Fascinating. I've been hearing a lot about "free market economies". Can you provide any examples? I'd like to learn more.
  - euwhr132 10y ago
    I said "economics", as in the theory or ideas, not "economies", as in countries. What I was somewhat sloppily referring to was the classical liberal ideas based on writings of Adam Smith (who's mentioned in the article), David Hume, John Locke etc. As opposed to the Marxist view I guess. And I said it because the article argues somewhat (in)directly that management gets paid well because of position of power and luck, not merit, that free markets don't work, and throws around words like libertarianism, meritocracy etc., but makes no solid economic arguments, it's explained more from a point of populist left ideas based on my reading. Note that there's more than one competing idea here, and I personally don't necessarily agree with one single theory, but if you're interested in it in general here are some sources off the top of my head: Adam Smith - The Wealth of Nations [1] John Locke - Two Treatises of Government[2] Friedrich Hayek - The Road to Serfdom[3] david Hume - A Treatise of Human Nature[4] Austrian school of economics[5] Chicago school of economics[6] [1] https://en.wikipedia.org/wiki/The_Wealth_of_Nations https://en.wikipedia.org/wiki/The_Wealth_of_Nations [2] https://en.wikipedia.org/wiki/Two_Treatises_of_Government https://en.wikipedia.org/wiki/Two_Treatises_of_Government [3] https://en.wikipedia.org/wiki/The_Road_to_Serfdom https://en.wikipedia.org/wiki/The_Road_to_Serfdom [4]https://en.wikipedia.org/wiki/A_Treatise_of_Human_Nature https://en.wikipedia.org/wiki/A_Treatise_of_Human_Nature [5] https://en.wikipedia.org/wiki/Austrian_School https://en.wikipedia.org/wiki/Austrian_School [6] https://en.wikipedia.org/wiki/Chicago_school_of_economics https://en.wikipedia.org/wiki/Chicago_school_of_economics EDIT: Need to add at least Friedman I suppose. From here on out you can google classical liberalism, libertarianism, Age of Enlightenment, etc. And if you want different ideas, of which I guess the author would support some if he'd actually read / cited actual economic theory, Keynesian economics, Marxian economics, Economic interventionism etc... Milton Friedman - Capitalism and Freedom[7] [7] https://en.wikipedia.org/wiki/Capitalism_and_Freedom https://en.wikipedia.org/wiki/Capitalism_and_Freedom
anondon 10y ago
> 1. Introversion There is an implicit assumption in his definition of an introvert that is introvert == cut off from society. This is just plain wrong. An introvert is a a shy, reticent person and this does not imply that he is cut off from society or does not understand social interactions. I would argue that it's the exact opposite. Introverts understand social relationships and the "real world" very, very well. They just don't actively take part in social interactions much. > The first is the idea that measurement of things like quality and success can be objective, perfect and fair. These are not objective facts, they are highly contextual and can be manipulated by power struggles, charisma, clever marketing, or outright fraud. The article is concerned with startups with a very small team working on it. Measurement is easier than in large teams of people. I don't see OP disputing this directly. The question of power struggles, charisma etc does not arise in startups with a small team. > A second critical assumption being posited in Graham’s essay is that one person’s direct contribution can be disentangled from that of others. No, it's easier to have a better idea of what people in a small team contribute than in a large team. > Although he never says this payoff is guaranteed, he doesn’t deny it either First valid criticism. > Here is the crux of Graham’s assumption that programmers are the real engine of the value chain. He ignores the fact that without the infrastructure and ancillary components of the business, it isn’t so easy to simply translate that new piece of software into pure profit. That's exactly what small startups do, where the founders manage everything from code to sales to legal work (in the initial stages of a startup). > Graham so desperately wants to justify his own wealth as the righteous product of his own personal labor without acknowledging the effects of either luck or power Uncalled for personal attack, but yes, luck plays a major role. > “Smallness = Measurement”. Here, he uses the analogy of the “ten best rowers” who, if you take them out of a large system and put them together with a shared goal, will necessarily be superior. In comparison to large teams, measurement is easier in small teams. Team dynamics are still important, whether the team is small or large. > It is amazing how well this piece serves as marketing fodder for Graham’s venture capital arm, Y Combinator. Looking at it from a cynical perspective, yes. Nothing stops people from questioning or rejecting (or dismissing) his work publicly as lots of people on HN and twitter do. > Libertarianism != Meritocracy This section has some valid criticisms of libertarianism and PG's implicit bias towards it.
amelius 10y ago
I think the biggest trap for developers is that they put all their eggs in one basket. Whereas, of course VCs like Graham wisely spread their money. Imho, we as a community should put more weight on that aspect, and we should stimulate also the failures of Silicon Valley to come forward with their stories to prevent bias. For example, we've heard some stories of people making truckloads of money on app-stores, but do we really have any bearing on what the average capable developer makes? If we don't want to end up as disillusioned gold-diggers, we should really get that kind of data out.
- Alex3917 10y ago
  > I think the biggest trap for developers is that they put all their eggs in one basket. But it's a big basket. It's expected that you're going to need to try a dozen different variations of the same idea before something sticks.
- garry 10y ago
  PG may have become an investor and most newcomers may have forgotten this but before YC he was himself a hacker who started a company and became successful. Now years later, after having started a company through YC and then becoming a YC partner and now seeing this same kind of magic happen over and over again with hacker founders, I can't help but attest to the fact that his worldview has proven to be valuable. The disillusioned worldview justifies lying on the floor. The essay's worldview prods you to get up.
  - dongslol 10y ago
    I find it fascinating that people interpret his essays as elitist or "meritocratic" (in a dirty sense) when his basic message is optimistic: you, too, can start a startup. The whole self-serving thing, too. How does it make life better for him if more people who shouldn't start startups try? YC just gets more bad applications.
  - amelius 10y ago
    > PG may have become an investor and most newcomers may have forgotten this but before YC he was himself a hacker who started a company and became successful. Yes, that is certainly laudable, but he may be suffering from survivor bias.
mwytock 10y ago
Wow this guy really needs to take it down a few notches. Yes, PG's articles present a magical fantasy world dominated by the masterful hacker and visionary entrepreneur. They are inspiring and fun to read. And they may have some truth to them. Attacking these essays as an oversimplification while presenting a caricature of the introvert and disconnected programmer is borderline ridiculous.
- czep 10y ago
  > this guy really needs to take it down a few notches Author here. Man, if I took it down a few notches, I'd bury myself under my own hubris! I'm nobody, certainly not worth PG's time or perhaps yours, I'm trying to speak truth to power and won't apologize for stepping on anyone's hero worship. I absolutely agree with you that Graham's essays are inspiring and fun to read. I think I made that clear as well. The frustration which drove this essay was his casual observation that the best programmers are libertarians. I don't think that's true and have data to support it. I'm also frustrated to see a powerful man perpetuate self-serving ideologies without acknowledging the influences of power and luck. > borderline ridiculous Story of my life. But I think my caricature still stands as an illustration of how the introverted mindset can shut off more nuanced views of social and political structure and lead one to adopt a personal view that serves those in power.
  - mrmaximus 10y ago
    czep, even though I don't agree with much of what you wrote (in the article), I do appreciate you taking the time to so thoroughly expound on the ideas. Paul Graham most likely fell victim to projection of a Libertarian ideal when he viewed "best programmers" from his perspective. > I'm also frustrated to see a powerful man perpetuate self-serving ideologies without acknowledging the influences of power and luck. I agree with this above statement maybe or maybe not for the reasons you do. The "Power Game", or even the lack of willingness or know-how to play it is the reason a lot of programmers think themselves superior to the sales guys who peddle the product of their labor. The "Power Game" is also the same reason the good sales guys feel that despite being so technically smart, programmers can be damned idiotic fools. As an introverted "programmer-type" myself, life would be way easier for me if there was no Power Game. But the Power Game is as human as eating, drinking and pissing. Hell, I get irritated daily that I even have to eat, drink or piss. It feels like a waste of time when I am in the zone with something. Same thing with the Power Game. Luck... hugely important. Heck, we've all played RPG's and know to fill up that skill bucket ASAP. Maybe what would really be helpful to programmers is something that can stir inspiration like Paul Graham, but that covers something akin to "The 48 Laws of Power" for the introverted modern day employees.
irln 10y ago
It would seem the biggest impediment to the "fairness" and successful implementation of a free market is the ability of the participants to have access to perfect information.
fsloth 10y ago
Whoa, out of of context. Paul made a point about an idea. Economics is not science. Paul tried to convey the feel of a startup and the ideas which might drive it. It's a touchy feely piece (not any worse as such). One of the important things to feed ones intuition is to convay how a thing should feel. This was food for intuition, not a detailed analysis. That's how I read it, anyhow. I approach any non-peer reviewed work as prose and poetry. Some other people mighr be more stringent.
squozzer 10y ago
>Historically, societies with laissez-faire economic policies have been associated with rigid, hierarchical social structures with negligible social mobility. Historically, ALL societies have possessed rigid, hierarchical social structures with negligible social mobility, and very few of them had anything close to laissez-faire economic policies. What made Renaissance / Enlightenment Europe a little better than the rest was its intense competition along several dimensions (political, economic, technological) both between and within political entities; such a world made creative types too valuable to be liquidated or enslaved. >In a perfectly libertarian society, the bullies would not only take your lunch money, they would murder your family, burn your house, and leave you for dead by the side of the road. This is your free society. Enjoy. And eventually the bullies would run out of prey -- and would have to prey upon themselves. But it would probably not come to that. Anyone with half a brain would have stopped contributing to such a flawed society a long time ago, and maybe even started undermining it, e.g. the USSR.

79 points by jimsojim 10y ago

> Graham’s understanding of economics is woefully pedestrian, un-researched conjecture. His conceptualization of the economics of exchange relies on a stubborn insistence and blind naive trust that the free market is the ultimate solution to which his audience must subscribe. It is distressing that one could allow arrogance to so cloud his judgment that he would embarrass himself by making such claims in an area of study he is clearly lacking any authority on which to speak. The author sounds rather more arrogant than Paul Graham did. And free markets are the ultimate solution. EDIT: The more I read, the more ridiculous it gets. The author takes something that Paul Graham said, throws away all of the context, and attacks it as a strawman. The article seems more keen on attacking Paul Graham than making any actual point. It is also written in a very verbose style that makes it hard to follow whatever argument might be present.

aleksei 10y ago
> And free markets are the ultimate solution. On the subject of arrogance, spoken like a true believer.. There is hardly ever an ultimate solution to anything, and to take an extreme position on matters is almost always harmful. Things are never simply black and white.
- bko 10y ago
  Not the OP, but I think belief in free markets is not arrogant. In a free market, decisions are made on an individual level with actors affected that know their preferences and needs much better than a central body. I think its more arrogant to suggest that some planning committee would be able to make better decisions for that individual. Of course there are instances where there exists knowledge imbalances and sub-optimal decisions can be made. But the alternative is often no better due to the agency problem of having someone make decisions on your behalf
  - amelius 10y ago
    > In a free market, decisions are made on an individual level with actors affected that know their preferences and needs much better than a central body. The free market is a lot like a mosh pit. Everybody is free to move (in principle), but in the end some may get seriously injured.
    - bko 10y ago
      You have to compare that to the alternative. Yes, some people will make less than optimal decisions, but the alternative is not perfect
      - amelius 10y ago
        The alternative is that a regulator puts some safety measures in place, like some fences here and there, and emergency exits. The result may not be perfect, but overall it's a better place to find yourself in.
  - stymaar 10y ago
    > I think its more arrogant to suggest that some planning committee would be able to make better decisions for that individual. Objecting against the free market illusion is not advocating for a planification entity. Free market is a fallacy because there is no such things in the real world. Studying economics with the perspective of free market is like studying mecanics assuming mass-less bodies. It might offer a nice framework (the math becomes really simple) in which most of the problem we face disapear (no inertia, flying cars \o/), but that gives you no help if you want to understand and fix the world we live in. In practice nobody is even really trying to make free market a thing, otherwise you would see politician advocating for bans on price discrimination and investor would stop asking founders what are the barrier that prevents their competitors to get in their market, because both price discrimination and barrier to entries are responsible for «market failures». Is communism/economic planning a good idea ? Of course not. Is free market salvation ? Nope. Hayek had a really good diagnostic of the drawbacks of communism, but he had a totally irrational faith in the free market and this vision is shared by too many people. Unfortunately irrational faith does more harm than good …
- ArkyBeagle 10y ago
  Free markets are a useful fiction that was developed around the time of Adam Smith. They are ( I think, anyway ) a demonstrable improvement over mercantilism. We more or less know how, and we more or less know why. The problem with "things that are not free markets" is that we simply know very little about those things, and the learning curve is significant. USAian bulk crops agriculture is not a free market, it mostly seems to work well that way but it started under FDR and only reached its present form after decades of tweaking. In effect ( the theory goes that ) larger price uncertainties will create price instabilities that, net-net, add more inefficiency than pricing things a skosh higher and accommodating overproduction. As political speech, the term "free market" has been rendered threadbare. "Trade agreements" seem to mostly be more akin to Mercantilism than free markets, and so on.
czep 10y ago
The author, arrogant and verbose though he may be, takes issue with Graham's casual assertion that the best hackers are libertarians, and attempts to deconstrust the psychology underlying this connection. What's so illustrative is how Graham inspires his followers to believe the way he does in order to justify and perpetuate his own wealth. The money quote in my mind is: > It is amazing how well this piece serves as marketing fodder for Graham’s venture capital arm, Y Combinator. His business model relies on convincing hordes of eager young hackers to sign over their surplus labor to his investors. With logic crafted to appeal directly to the introverted minds of recent computer science graduates, he has no shortage of cannon fodder lining up on his doorstep willing to eat Ramen and gleefully line the coffers of his investor’s portfolios.
- jstanley 10y ago
  But many of the best programmers are libertarians. At a much higher proportion than in the general population, from my (admittedly not well-recorded) observations.
  - czep 10y ago
    I looked at this very question with the help of the General Social Survey. I found that software engineers tend to hold more extreme political views than the average for the population, but it was equally split leaning to the far right as to the far left. It was a significant effect, but not terribly strong (i.e. just a few percentage points in either direction). Of course, the GSS can't tell you who are the "best" programmers.
    - jstanley 10y ago
      Do you think libertarians are far right or far left? Because I subscribe to something more like this: http://www.littlecamels.com/files/PoliticalCross.jpg http://www.littlecamels.com/files/PoliticalCross.jpg Where libertarianism is on a separate axis to the usual left/right.
      - 10y ago
wavefunction 10y ago
Free markets are an unattainable Platonic ideal. Just like perfect Communism, it all begins to get messy and come apart at the seams when you introduce theory to the real world and allow fully emotional, non-market-rational humans as the free agents.
pja 10y ago
And free markets are the ultimate solution. Ultimate solution to what? There’s an entire field of economics dedicated to the way free markets can fail to allocate resources efficiently, even when the participants are free agents acting without external constraints. Do you think this work is false? Or do you believe that the inefficient allocation of resources is an acceptable price to pay, because “free markets” are more important than outcomes?

leereeves 10y ago

> In a perfectly libertarian society, the bullies would not only take your lunch money, they would murder your family, burn your house, and leave you for dead by the side of the road. What brand of libertarianism is the author talking about here? That sounds like anarchy, not libertarianism.

philipov 10y ago
That sentence is saying that a perfectly libertarian society is an anarchy, where might (market) makes right.
- deleted 10y ago
  [deleted]
- bko 10y ago
  > Libertarians share a skepticism of authority and maintain that the power of the state has to be limited or eliminated in order to protect individuals from the arbitrary exercise of authority. [0] I think most would agree that "arbitrary exercises of power" would include murder and arson. The author really does his argument injustice by throwing around a caricature of a political philosophy. [0] https://en.wikipedia.org/wiki/Libertarianism https://en.wikipedia.org/wiki/Libertarianism
  - foldr 10y ago
    "Minimal state" varieties of Libertarianism tend to be internally inconsistent, though. You can't say that taxation is theft and then say, ah yes, but we do actually need a little bit of taxation to fund the police and the judiciary.
    - bko 10y ago
      Agree there are some inconsistencies regarding taxation and the minimal services that the government should perform. However, I would note that the primary tenant of the philosophy is liberty, both economic and personal. This liberty would include property rights, which includes ones person. Ideally, there would be a choice of governing associations that one can choose from for police or judiciary, although I see how this can be impractical in practice. This already exists in the sense that one is free to move to different cities/states but due to the expansion of the role the federal government, this distinction has been made less relevant.

dongslol 10y ago

"There are so many problems with Graham’s thinking that it is difficult to organize a focused response." Statements like these are pointless theatrics. The more wrong someone is, the easier, not harder it is to point out where and how. What's the argument? You have to wait until section 2 to find one: "...there are actually several critical errors in the above reasoning which render Graham’s conclusions baseless. The first is the idea that measurement of things like quality and success can be objective, perfect and fair. These are not objective facts, they are highly contextual and can be manipulated by power struggles, charisma, clever marketing, or outright fraud. Value is a social construct..." After about eight paragraphs about how "pedestrian" PG is, his point (finally) is basically that value is subjective and immeasurable. I don't know how true this is philosophically, but for all intents and purposes, if it were true, it would mean that nothing could be better than anything else. [1] It's also a conflation of ideas. Marketing doesn't create value; it distributes and sells it. Value as defined in the original essay is the meaty stuff people want: a home computer, for example, or an affordable spaceship. "Graham identifies that “Many of the employees (e.g. the people in the mailroom or the personnel department) work at one remove from the actual making of stuff.” So what exactly do they contribute to the wealth generation process? Does Graham imply that without these others working at “one remove”, the programmers could still create the wealth they do? Without the human resources team to coordinate their medical benefits, would the programmers be as productive? Without the legal team to fend off frivolous lawsuits brought by patent trolls [...]?" (And so on.) All Graham is saying is that programmers are directly involved in the creation of the product itself — its design, engineering, and maintenance. Other people create the social environment that makes it possible for this product to be distributed and not be killed, but don't make stuff in the artisanal sense. I can understand why it would be insulting if someone claimed that anyone who isn't a maker were somehow useless, but Graham never did. I'm ten minutes in, and everything I've read is basically a verbose form of "it's all relative" and "things are more complicated than that." Philosophy has a standard refutation to this: we deal with complex phenomena by isolating principles. For example, the abstract idea of value, the distinction between creation and distribution, and so on. It's the most boring thing in the world to hear, "the universe is more complex than that idea captures." All abstractions are reductions. This sort of argument based on moral outrage and authority about how the real world works holds back truthseeking discourse. [1] I also have a hard time understanding how someone who has earnestly tried to make good things could want this to be true.

euwhr132 10y ago

Meh. There might be logical errors in Graham's essay, but this just looks like an angry and forceful attempt to rebut his ideas because the author doesn't agree with ideas of free market economics etc. And secondly, I know this isn't the main point but, these "introversion explanations" are annoying and likely part of the reason the industry has problems with diversity. Looks to me like a lot of the people in the industry want to constantly propagate the idea that "the programmer" or "we the programmers" are utopian introvert nerds to anyone who would listen. Got me avoiding talking about what I do so I can have normal conversations about sports and politics with people working outside tech.

specialist 10y ago
Fascinating. I've been hearing a lot about "free market economies". Can you provide any examples? I'd like to learn more.
- euwhr132 10y ago
  I said "economics", as in the theory or ideas, not "economies", as in countries. What I was somewhat sloppily referring to was the classical liberal ideas based on writings of Adam Smith (who's mentioned in the article), David Hume, John Locke etc. As opposed to the Marxist view I guess. And I said it because the article argues somewhat (in)directly that management gets paid well because of position of power and luck, not merit, that free markets don't work, and throws around words like libertarianism, meritocracy etc., but makes no solid economic arguments, it's explained more from a point of populist left ideas based on my reading. Note that there's more than one competing idea here, and I personally don't necessarily agree with one single theory, but if you're interested in it in general here are some sources off the top of my head: Adam Smith - The Wealth of Nations [1] John Locke - Two Treatises of Government[2] Friedrich Hayek - The Road to Serfdom[3] david Hume - A Treatise of Human Nature[4] Austrian school of economics[5] Chicago school of economics[6] [1] https://en.wikipedia.org/wiki/The_Wealth_of_Nations https://en.wikipedia.org/wiki/The_Wealth_of_Nations [2] https://en.wikipedia.org/wiki/Two_Treatises_of_Government https://en.wikipedia.org/wiki/Two_Treatises_of_Government [3] https://en.wikipedia.org/wiki/The_Road_to_Serfdom https://en.wikipedia.org/wiki/The_Road_to_Serfdom [4]https://en.wikipedia.org/wiki/A_Treatise_of_Human_Nature https://en.wikipedia.org/wiki/A_Treatise_of_Human_Nature [5] https://en.wikipedia.org/wiki/Austrian_School https://en.wikipedia.org/wiki/Austrian_School [6] https://en.wikipedia.org/wiki/Chicago_school_of_economics https://en.wikipedia.org/wiki/Chicago_school_of_economics EDIT: Need to add at least Friedman I suppose. From here on out you can google classical liberalism, libertarianism, Age of Enlightenment, etc. And if you want different ideas, of which I guess the author would support some if he'd actually read / cited actual economic theory, Keynesian economics, Marxian economics, Economic interventionism etc... Milton Friedman - Capitalism and Freedom[7] [7] https://en.wikipedia.org/wiki/Capitalism_and_Freedom https://en.wikipedia.org/wiki/Capitalism_and_Freedom

anondon 10y ago

> 1. Introversion There is an implicit assumption in his definition of an introvert that is introvert == cut off from society. This is just plain wrong. An introvert is a a shy, reticent person and this does not imply that he is cut off from society or does not understand social interactions. I would argue that it's the exact opposite. Introverts understand social relationships and the "real world" very, very well. They just don't actively take part in social interactions much. > The first is the idea that measurement of things like quality and success can be objective, perfect and fair. These are not objective facts, they are highly contextual and can be manipulated by power struggles, charisma, clever marketing, or outright fraud. The article is concerned with startups with a very small team working on it. Measurement is easier than in large teams of people. I don't see OP disputing this directly. The question of power struggles, charisma etc does not arise in startups with a small team. > A second critical assumption being posited in Graham’s essay is that one person’s direct contribution can be disentangled from that of others. No, it's easier to have a better idea of what people in a small team contribute than in a large team. > Although he never says this payoff is guaranteed, he doesn’t deny it either First valid criticism. > Here is the crux of Graham’s assumption that programmers are the real engine of the value chain. He ignores the fact that without the infrastructure and ancillary components of the business, it isn’t so easy to simply translate that new piece of software into pure profit. That's exactly what small startups do, where the founders manage everything from code to sales to legal work (in the initial stages of a startup). > Graham so desperately wants to justify his own wealth as the righteous product of his own personal labor without acknowledging the effects of either luck or power Uncalled for personal attack, but yes, luck plays a major role. > “Smallness = Measurement”. Here, he uses the analogy of the “ten best rowers” who, if you take them out of a large system and put them together with a shared goal, will necessarily be superior. In comparison to large teams, measurement is easier in small teams. Team dynamics are still important, whether the team is small or large. > It is amazing how well this piece serves as marketing fodder for Graham’s venture capital arm, Y Combinator. Looking at it from a cynical perspective, yes. Nothing stops people from questioning or rejecting (or dismissing) his work publicly as lots of people on HN and twitter do. > Libertarianism != Meritocracy This section has some valid criticisms of libertarianism and PG's implicit bias towards it.

amelius 10y ago

I think the biggest trap for developers is that they put all their eggs in one basket. Whereas, of course VCs like Graham wisely spread their money. Imho, we as a community should put more weight on that aspect, and we should stimulate also the failures of Silicon Valley to come forward with their stories to prevent bias. For example, we've heard some stories of people making truckloads of money on app-stores, but do we really have any bearing on what the average capable developer makes? If we don't want to end up as disillusioned gold-diggers, we should really get that kind of data out.

Alex3917 10y ago
> I think the biggest trap for developers is that they put all their eggs in one basket. But it's a big basket. It's expected that you're going to need to try a dozen different variations of the same idea before something sticks.
garry 10y ago
PG may have become an investor and most newcomers may have forgotten this but before YC he was himself a hacker who started a company and became successful. Now years later, after having started a company through YC and then becoming a YC partner and now seeing this same kind of magic happen over and over again with hacker founders, I can't help but attest to the fact that his worldview has proven to be valuable. The disillusioned worldview justifies lying on the floor. The essay's worldview prods you to get up.
- dongslol 10y ago
  I find it fascinating that people interpret his essays as elitist or "meritocratic" (in a dirty sense) when his basic message is optimistic: you, too, can start a startup. The whole self-serving thing, too. How does it make life better for him if more people who shouldn't start startups try? YC just gets more bad applications.
- amelius 10y ago
  > PG may have become an investor and most newcomers may have forgotten this but before YC he was himself a hacker who started a company and became successful. Yes, that is certainly laudable, but he may be suffering from survivor bias.

mwytock 10y ago

Wow this guy really needs to take it down a few notches. Yes, PG's articles present a magical fantasy world dominated by the masterful hacker and visionary entrepreneur. They are inspiring and fun to read. And they may have some truth to them. Attacking these essays as an oversimplification while presenting a caricature of the introvert and disconnected programmer is borderline ridiculous.

czep 10y ago
> this guy really needs to take it down a few notches Author here. Man, if I took it down a few notches, I'd bury myself under my own hubris! I'm nobody, certainly not worth PG's time or perhaps yours, I'm trying to speak truth to power and won't apologize for stepping on anyone's hero worship. I absolutely agree with you that Graham's essays are inspiring and fun to read. I think I made that clear as well. The frustration which drove this essay was his casual observation that the best programmers are libertarians. I don't think that's true and have data to support it. I'm also frustrated to see a powerful man perpetuate self-serving ideologies without acknowledging the influences of power and luck. > borderline ridiculous Story of my life. But I think my caricature still stands as an illustration of how the introverted mindset can shut off more nuanced views of social and political structure and lead one to adopt a personal view that serves those in power.
- mrmaximus 10y ago
  czep, even though I don't agree with much of what you wrote (in the article), I do appreciate you taking the time to so thoroughly expound on the ideas. Paul Graham most likely fell victim to projection of a Libertarian ideal when he viewed "best programmers" from his perspective. > I'm also frustrated to see a powerful man perpetuate self-serving ideologies without acknowledging the influences of power and luck. I agree with this above statement maybe or maybe not for the reasons you do. The "Power Game", or even the lack of willingness or know-how to play it is the reason a lot of programmers think themselves superior to the sales guys who peddle the product of their labor. The "Power Game" is also the same reason the good sales guys feel that despite being so technically smart, programmers can be damned idiotic fools. As an introverted "programmer-type" myself, life would be way easier for me if there was no Power Game. But the Power Game is as human as eating, drinking and pissing. Hell, I get irritated daily that I even have to eat, drink or piss. It feels like a waste of time when I am in the zone with something. Same thing with the Power Game. Luck... hugely important. Heck, we've all played RPG's and know to fill up that skill bucket ASAP. Maybe what would really be helpful to programmers is something that can stir inspiration like Paul Graham, but that covers something akin to "The 48 Laws of Power" for the introverted modern day employees.

irln 10y ago

It would seem the biggest impediment to the "fairness" and successful implementation of a free market is the ability of the participants to have access to perfect information.

fsloth 10y ago

Whoa, out of of context. Paul made a point about an idea. Economics is not science. Paul tried to convey the feel of a startup and the ideas which might drive it. It's a touchy feely piece (not any worse as such). One of the important things to feed ones intuition is to convay how a thing should feel. This was food for intuition, not a detailed analysis. That's how I read it, anyhow. I approach any non-peer reviewed work as prose and poetry. Some other people mighr be more stringent.

squozzer 10y ago

>Historically, societies with laissez-faire economic policies have been associated with rigid, hierarchical social structures with negligible social mobility. Historically, ALL societies have possessed rigid, hierarchical social structures with negligible social mobility, and very few of them had anything close to laissez-faire economic policies. What made Renaissance / Enlightenment Europe a little better than the rest was its intense competition along several dimensions (political, economic, technological) both between and within political entities; such a world made creative types too valuable to be liquidated or enslaved. >In a perfectly libertarian society, the bullies would not only take your lunch money, they would murder your family, burn your house, and leave you for dead by the side of the road. This is your free society. Enjoy. And eventually the bullies would run out of prey -- and would have to prey upon themselves. But it would probably not come to that. Anyone with half a brain would have stopped contributing to such a flawed society a long time ago, and maybe even started undermining it, e.g. the USSR.