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Elon Musk: ‘Too many smart people go into finance and law’
- jseliger 6y agoLegal academic Paul Campos's book Don't Go To Law School (Unless) agrees with the "too many people go into law" point: https://jakeseliger.com/2012/11/11/dont-go-to-law-school-unless-paul-campos/ https://jakeseliger.com/2012/11/11/dont-go-to-law-school-unl.... But the number of people taking the LSAT has fallen by half since the Great Recession, at least last time I saw the data; it might have grown again since. But these days, most generically smart people who don't know what to do with their lives are probably better off doing a CS degree or coding boot camp than law school.
- boltzmannbrain 6y agoSenior year of Mechanical Engineering undergrad, professors would legitimately get upset with students for taking jobs in finance and consulting. They wouldn't hold back, saying quite literally "this is a waste of your education."
- ashtonkem 6y agoIt’s easy to say that when you’re on the side lines, and not making decisions about career growth and net worth. Its also easy to say that when you don’t have student debts. People go into finance for extremely rational reasons. Getting upset at them for that is folly.
- MiroF 6y agoOn the contrary, I think social stigma and pressure can definitely influence what careers people go into and the suggestion that most people make decisions as purely rational money-making machines seems somewhat facile.
- ashtonkem 6y agoI agree that humans aren’t totally rational in these decisions, but the key point is that the professor is totally ignoring a large amount of what drives people to go into finance: money. It’s much easier to say how someone should use their skills, when you don’t have to live off of the salary those skills bring.
- MiroF 6y agoAh yes, the professor gets to live off of the luxurious salary provided to academics.
- ashtonkem 6y agoCome now, don’t make up my argument. That’s bad style. Professors aren’t rich, duh. But they’re also neither in the job market, not starting their career off. Their students need to build wealth, worry about long term earnings potential, and pay back the large student debt that they just incurred. Unless if the professor is actively planning on quoting soon, none of these are incentives that the professor are subject to personally, meaning their advice will probably underweight them.
- ycombinete 6y agoIt might not be the choice that will change the world for the better, but it is most certainly a pragmatic one. I don’t know about the rest of the world, but in South Africa (where I’m from) these two fields account for roughly 30% of all of our dollar millionaires. I’m sure it’s the same/similar in the developed world.
- alibaba_x 6y agoThe first thing Musk did after arriving to Canada as a 17 year-old was call up senior bankers until he secured an internship at one of their banks. He then got into online payments (X.com, PayPal) and the sale of his shares allowed him to start SpaceX and buy Tesla. So don't listen to what billionaires say and just look at what they do if you don't want to get deceived by them.
- gpm 6y agoI don't think Musk is saying "as a smart person it is in your self interest to not go into finance or law", rather I interpret the statement as "as a society we incentive too many smart people to go into finance and law".
- xoxoy 6y agoI don’t think as many “smart people” go to law school any more. Pretty sure law school enrollment has been on the decline for awhile.
- loufe 6y agoI suppose that depends on where you live. In Canada, at least, law programs continue to have very competitive entry requirements and the market for lawyers is rather saturated meaning salaries are relatively low for post-graduate professions.
- MiroF 6y ago> rather saturated meaning salaries are relatively low for post-graduate professions. Not a contradiction. This is exactly why the proportion of very smart people going into law is decreasing.
- irishcoffee 6y agoI don’t know if it’s on the decline, but I do know that a whole lot of people graduate college and have a “now what? Law school.” Moment
- xoxoy 6y agoAre people actually reading this at face value in a non ironic way...? Tesla is Tesla because of an army of lawyers and financial engineering.
- kami8845 6y agoWhat the hell are you talking about? Tesla is Tesla because of their incredible engineering talent. The rest they do to amplify their car building efforts. If you offered Elon 100 incredible engineers/lawyers/financiers, he'll take the engineers every time. How many car startups that achieve wide distribution has America had in the past 100 years?
- xoxoy 6y agoElon’s 2 most important people at Tesla is his CFO and General Counsel. If you think otherwise pay closer attention to his earnings calls.
- jryle70 6y agoWhy focus on earning calls and not, says, meetings with Chinese partners for his Shanghai Gigafactory? CFO and legal counsels, or similar roles, are pretty much always present in calls with investors for any public companies. Also, what makes Tesla being Tesla is something invented centuries ago. The battery.
- kami8845 6y agoThat is really quite crazy that a legally required event to discuss finances would prominently feature Tesla legal & finance. I think you might be onto something.
- 8note 6y agoWhat's special about their engineering? You can easily point to ford and Toyota's major innovations that changed not only the car industry, but manufacturing on the whole. The Prius also stands out as the big success on moving drivers off of fossil fuels. What's Tesla got? At a surface view, I'd say their engineering is worse than their competitors. Poorly engineered products and manufacturing processes make for slow production -- a problem that Tesla is pretty famous for o think? My understanding is that they design overly complex parts and use overly complex mechanisms to build their cars.
- thatfrenchguy 6y agoYou could easily say too many people go into tech to do ads as well.
- generalpass 6y agoAnd too many engineers go into the defense industry.
- almost_usual 6y agoThe defense industry is why the internet exists. You could argue both Tesla and SpaceX orient their goals around human survival and defense. One for slowing down climate change, the other for interplanetary colonization. Fear motivates society into funding engineering projects and taking action.
- generalpass 6y ago> The defense industry is why the internet exists. The defense industry throws money at anything that seems to suit its needs. Thus, claiming that without the defense industry we would never have the Internet is not clear to me. I am familiar with disproving negatives, but I don't find it to be a compelling claim that the scientists involved would never have developed the Internet. For example, was the mother of all demos exclusively the result of actions from the DoD? The innovative scientists and engineers at Xerox PARC? Many of the people involved in these things likely already theorized on how to build this sort of stuff, and sought out the easiest route. But the DoD comes with substantial amounts of other costs. For example, the Vietnam war is largely understood to have been initiated by people within the DoD complex and not the actions of foreign governments. During the war, the DoD cronies forced soldiers to use a defective assault rifle that would leave entire platoons with nothing but grenades and handguns to get slaughtered. Agent Orange killed and continues to kill an incredible number of civilians in Vietnam. On balance, the DoD leads to horrific amounts of death and destruction using engineers who may otherwise create things that would make people's lives better. Further, significant innovations such as the Internet would most likely still have been developed, just by some private entity or group of entities where the scientist and engineers would have gone to work.
- data4lyfe 6y agoSeems like a comment that was reserved for pre-2010s when medicine, law, and finance were the only ways to make six figures out of school. Nowadays it seems more and more common that this phrase is "Too many smart people go into working on ad optimization".
- davidwihl 6y agoBut ad optimization has led to many other technical innovations in ML and scalability. I don’t think the same can be said about law school. Disclosure: work on ad tech at Google. Opinion my own.
- forgot_again 6y agoAlso ad optimization has brought in revenue for a commercial entity (Alphabet) that is willing and eager to pour its resources into amazing and beneficial things that a Law firm or Bank simply would never think to invest in building themselves.
- yowlingcat 6y agoThis is patently wrong. Plenty of law firms and banks, once they reach a given amount of surplus capital, open up investment arms that can and do invest in long shots that large multinationals like Alphabet have branded themselves for. Don't conflate the brand Alphabet has regarding investment in innovation for a monopoly on that kind of investment in innovation.
- iamacyborg 6y agoOn the other hand, banks aren't building systems to extract more and more private information from individuals. The harm coming from a business like Alphabet significantly outweights the beneficial things they do.
- pb7 6y agoThey don’t need to when they can charge you a $50 fee for keeping an account open that costs them virtually nothing to maintain and lending you money at virtually no risk because the Fed can just print more in case they mess up. > The harm coming from a business like Alphabet significantly outweights the beneficial things they do. Doubt it. This is first world privileged thinking.
- lrm242 6y agoHere’s an idea: don’t project your values or idea of worth on what other people choose to do with their life. You’re not as righteous as you may think you are, I guarantee it.
- stcredzero 6y agoHere’s an idea: don’t project your values or idea of worth on what other people choose to do with their life. You’re not as righteous as you may think you are, I guarantee it. That's pure gold! I'm putting that one in my notes! But to play devil's advocate: Well, if you go empirical on this, then what the heck else is the Internet for, aside from porn!?
- MiroF 6y ago> don’t project your values or idea of worth on what other people choose to do with their life. Unless you're a moral relativist, why shouldn't I do this? I find this entire attitude baffling. If you went around assassinating people to make a living, I think I would be fine in saying that you're an asshole, no?
- vardump 6y agoNot sure if it's intentional, but that's an interesting twist to "this statement is false".
- seemslegit 6y agoToo many smart people care about stuff Elon Musk says. EDIT: Changed my mind - not too many smart people in fact care about stuff Elon Musk says.
- yowlingcat 6y agoI'd amend what you say to "too many smart people remain entertained by the outlandish stuff Elon Musk says" (and I'd put myself in that camp), but I agree with the sentiment, as well as those voiced elsewhere in this thread, that you should pay attention to what Elon Musk does and has done, and not so much towards what he says.
- cameronbrown 6y ago> you should pay attention to what Elon Musk does and has done, and not so much towards what he says Hmm... I hear this argument about Trump from his supporters too.
- cowmix 6y agoAs a Musk fan and Trump not-a-fan, I can see your point. BTW, most Musk fans do not think this way. Most are frustrated by some of the crazy crap he says or does (and therefor creates headlines) but 98% of what he does and says is mostly good stuff. His COVID19 comments have been really trying on my patience too.
- hyko 6y agoElon Musk is liberal Donald Trump.
- tfehring 6y agoThis may still be the case, but it’s definitely less true than it was in, say, 2005. Today’s closest equivalent IMO is ad/surveillance tech. Maybe management consulting too, though I don’t know what share of management consultants are actually smart.
- MiroF 6y agoManagement consulting and finance are still huge on the east coast.
- tfehring 6y agoAmong the group of smart people Musk is referring to, though? My impression is that there was a time when a plurality of, say, new physics PhDs were getting snapped up by quantitative trading firms, and that nowadays they're going into adtech ML roles instead.
- MiroF 6y agoEh - I think a lot of Physics PhDs still become quants, I say this having majored in physics at one of these east coast universities. Management consulting a little less so from PhD but definitely from undergrad.
- bullen 6y agoThere is a broader underlying thing going on here: Japan has removed all humanities at their universities. There are only 4 interesting fundamental categories of knowledge: Math, Physics, Chemistry and Biology; everything else is made up by man from nothing and it will return to nothing after all surplus energy (that gave humans the possibility to dream up all that crap in the first place) is consumed! Hang on to your knowledge of nature people; because this society is going Kansas.
- phkahler 6y ago>> Hang on to your knowledge of nature people; because this society is going kansas. To make predictions about society dont you need an understanding of... I dunno. Sociology, Psychology, Politics, Finance, or maybe History? I dont remember societal forecasting in my STEM classes. Not meant as a roast, just a mild reminder that the dominant force on earth is people.
- MiroF 6y agoI don't think that social scientists have a particular strong track record with forward predictions and it is impossible to distinguish those who do from those who don't.
- apotheon 6y ago. . . and yet, if you wanted to improve your ability to make such predictions about society, social sciences would be a better bet than chemistry. Prediction, absent supernatural aid, requires understanding.
- apotheon 6y agoFinance? WTF? I'm guessing you had one of those "what's the word, uh . . . not finance, but that'll do" moments. We all have those. Just to ensure we're all clear here, though: Finance is about navigating the particular niceties of dealing with money as a professional, and maybe a little bit of trend-misprediction for the sake of occasionally getting to be a "rainmaker" for some employer. I think you mean economics, which is about the movements of economic agents and of whole economies. Economics is a "social" science (ignoring for the moment the fact that some economists aren't very scientific), and finance is a (highly lucrative) job field.
- lihaciudaniel 6y ago>Buffet fan Well not like you have more money than him anyways
- tim333 6y agoI think Musk and others misunderstand what Buffett does. His company employs 390,000 people. It's more than just stock picking. They also produces I think more renewable energy more cost effectively than Musk's SolarCity. 2016: "4,423 megawatts of wind generation owned and operated by our regulated utilities is six times the generation of the runner-up utility."
- seemslegit 6y agoElon Musk prefers his knowledge and skill workers financially and legally illiterate, understandably so.
- dasudasu 6y agoFinance, when done right, is just the art of efficient capital allocation. Producing the right thing is also important.
- MiroF 6y agoMost of finance that I can see seems to consist of investment firms hiring lots of people with good credentials so that they can convince clients that the efficient market hypothesis actually doesn't apply to their firm, then making off with the profits. There's a reason only market makers are the ones prop trading any more.
- tryptophan 6y agoLuckily most people are starting to see the light of index investing. Good times for these investment firms are coming to an end.
- d357r0y3r 6y agoWow. HN commenters really missed the point here. The point is that not that smart people who went into finance and law somehow fucked up. It may be a perfectly rational and good choice for them. The point is that smart, hard-working people tend to get funneled into one of a handful of professions, and at this point, I would even include software in that handful. It would better if we had smart people also going into other, more underserved fields that are in dire need of innovation.
- DevopsQuestions 6y agoCan you list fields that you feel are in dire need of innovation? Genuinely curious.
- marviel 6y agoWe could use a lot more high-quality therapists and teachers to reduce the effective price of mental health and a good education.
- bob33212 6y agoConstruction, tunneling, automated manufacturing, vaccine creation
- jwr 6y agoBiotech! (witness the virus problem that we have known about for a while now, and did pretty much nothing about) Energy generation! Energy storage! Space exploration! New materials! I feel like so many fields have fallen behind, because of the way incentives are set up. It pays better to be a banker, or a lawyer, developing antibiotics isn't profitable enough, it pays better to work at a company that gathers data about people and pumps advertisements to them. It's rather sad, really.
- iancmceachern 6y agoMedical devices, medtech, etc.
- UnpossibleJim 6y ago
- luckydata 6y agoToo many people listen to Elon Musk.
- stcredzero 6y agoThere used to be this thing said about China vs. the US: That the leadership of elites in China were mostly from Engineering backgrounds, while those in the US went to Law School. The idea is that STEM people are better grounded in the epistemological reality of an external objective universe that doesn't care about your texts, your desires, or your ideology. My Chinese wife tells me this had reversed itself somewhat under Xi Jinping. (Re: Geeks, MOPS, and Sociopaths?) That regime's performance in the current pandemic crisis would seem to support this, though that government's record has been spotty to poor on the epistemology vs. ideology front for awhile. The problem with spending so much of one's time wrangling texts which are somewhat abstracted away from reality, is that one can lose touch with the epistemological grounding of reality. One might even start to believe they can start to rewrite reality through strong conviction. Before all you fellow programmers out there start feeling smug, think about this: As a programmer, one is primarily a wrangler of a particular kind of text. Ever wonder about why so many conflicts in the programming "field" ("" are a reference to Alan Kay) have the tenor of medieval sectarian religious squabbles?
- chewz 6y ago> Times are bad. Children no longer obey their parents, and everyone is writing a book. https://www.goodreads.com/quotes/56217-times-are-bad-children-no-longer-obey-their-parents-and https://www.goodreads.com/quotes/56217-times-are-bad-childre...
- kumarvvr 6y agoAfter his "Free America" comment, everything Musk says ought to be taken with a pound of salt. It is clear that there is not moral or ethical compass directing his actions. Just a passion, which is good in itself, and has brought enormous good to the world, directly or indirectly. However, it's high time to stop seeing him as some sort of Tony Stark.
- SpicyLemonZest 6y agoSurely his "Free America" comment demonstrates he is following a moral compass, even if it's not aligned with yours.
- MiroF 6y agoI don't think it demonstrates much of anything, except his opinion and way of communicating on this particular issue.
- jfoster 6y agoAre you sure? I thought that type of thing made him a bit more like Tony Stark. https://youtu.be/FRIUhO4MdGU https://youtu.be/FRIUhO4MdGU
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- checkyoursudo 6y agoI am not saying that I am smart. But I will say that I regret having gone into law. Regret is too strong of a word. I don't regret it. Law is fun and you can make a lot of money. Who doesn't like that? But, I had been dissuaded from getting a CS degree at university. It was partly because my dad was a SWE for one of the big ones when I was young, and I was a rebellious kid who could be swayed away from something I loved in part by not wanting to be like him. And, like I said, law was a field where I could make a lot of money. Back then, I didn't realize that I could have done CS without being like him. Rather, I regret it because I could have spent these years doing something that I loved. Anyway, I am rectifying that now by doing a masters in cognitive science with a goal of researching human curiosity and building curious machines. In other words, I am trying to rectify the error I made the first time around where I went into something for reasons other than because I really wanted to. I would also note that way way way too many not-smart people go into law and finance, as well. But I'm not sure there is much you can do about that.
- bepvte 6y agoWhy are we posting this guy? It seems like he's always just trying to make it into headlines. "AI will kill us when its made in 3 years when we get into mars" sure dude! Good luck on getting into twitter trends again, Elon.
- Waterluvian 6y agoThere was an article the other day that quoted someone saying, "the greatest minds of our generation are focused on making people click more ads." And I think there's a lot of truth to that. If you work at Facebook or Google or other companies, you've been convinced that you're the best of the best. The brightest of our generation. But ultimately all your work leads to selling ads. That's what's so attractive about Musk. He's a bizarre, often unhealthy mind. But he's dead focused on numerous businesses that have a considerably greater point than boosting ad impressions. And I think he continues to poorly communicate that frustration: way too little of our high tech industry is focused on true innovation for the betterment of humanity. I wish there were more non-Musks we could cheer for. My takeaway from his musings is that too many strong minds are funnelled into industries that don't push the envelope in more directions.
- bobbytherobot 6y agoI'm sick of tech being more scared of a man playing sound effects on CNBC than their thousands of paying customers.
- jeffnappi 6y ago>If you work at Facebook or Google or other companies, you've been convinced that you're the best of the best. The brightest of our generation. But ultimately all your work leads to selling ads. This may be somewhat true, but on the bright side these companies have made immense contributions to open source software. And that ultimately has a positive impact to humanity on a broad scale.
- _trampeltier 6y agoI will never understand people why work in law. You have to be smart, yes. It is good paid, yes. But I see really no fun in that kind of work. If you are creative in this work, you are just pain in the ass, who is looking for loopholes.
- cultus 6y agoI really don't think the life of the average working lawyer is like this, but analyzing legal arguments can be really fascinating. If you like logic puzzles, you're sure to like legal opinions. I had a bit of exposure to this as an undergrad, and it was one of my favorite subjects. It actually made me consider becoming a lawyer.
- cmckn 6y agoTangential, but I think the underlying issue is that too many people (smart or not) are herded into careers they don't want, simply so they can earn enough money to have the lifestyle they want. There are very few careers in America today that will enable a "middle class" (whatever that means nowadays) lifestyle. A nice car, a vacation every once in a while, a house to call your own, etc. "Smart" people often make the decision to obtain financial success via whatever means necessary, because being poor in America is decreasingly dignified and increasingly dangerous. And there is no "middle" option. I have no proposed solutions, just some bleak observations.
- swyx 6y agoam a smart person that went into finance. i agree. im just not sooo sure that what im doing in tech is a lot better. it's better, but how much better remains to be seen.
- lokl 6y agoI'd like to see more go into politics.
- okareaman 6y agoThe way I read this is we have too many people being clever in unproductive ways
- ausjke 6y agoFollow the money. Smart people go into finance and law. H1Bs fills the STEM positions. This is how it plays nowadays, it's called globalization of IT. I don't like that.
- woranl 6y agoThere is a cultural piece to this as well. For example in many Asian countries (particularly in Hong Kong), engineers are often confused with technicians or construction workers, which are generally not valued by the society. This perception has an impact to future generation when picking career choice. Basically, anyone can call him/herself an engineer and they generally don’t have any engineering knowledge, training, or ethics. It’s unfortunate how devalued the engineer title has become.
- xoxoy 6y agoPerfect timing. Elon just tweeted: “ Tesla is filing a lawsuit against Alameda County immediately. The unelected & ignorant “Interim Health Officer” of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!” https://twitter.com/elonmusk/status/1259159878427267072?s=21 https://twitter.com/elonmusk/status/1259159878427267072?s=21
- Mikeb85 6y agoHe's not wrong. Smart people go into the careers that provide them with the most personal benefit. In the Soviet Union most smart people became scientists and the country over-achieved in many domains related to science, but inevitably fell apart because of lower living standards and still never achieved the heights of capitalist societies who squander some smart people but create more wealth. But in the end most of us are just trying to live life, no one wants to sacrifice personal gain just so society can advance X amount quicker...
- rafiki6 6y agoThe Soviet Union didn't fall apart because of a low standard of living. There were many other geopolitical factors at play but the big one was just an inept government that declined with every new leader. Once you dismantle the cult of personality around communist authoritarian leaders, your population starts looking out for itself and begins to actively question the legitimacy of the government.
- Upvoter33 6y agoLots of people agree with this - and it's not really news. Surprised there is so much discussion here, just because Elon Musk said it.
- hyko 6y agoKind of odd that Elon doesn’t count financial engineering as innovation, when he’s bankrolled his dreams on the back of financial engineering innovation.
- tim333 6y agoI think he would count innovation in finance as innovation but really 95%+ of people in finance are not doing that.
- amrrs 6y agoBtw, Elon Musk's entire podcast with Joe Rogan (the recent one from which this came) is an interesting listen - https://youtu.be/RcYjXbSJBN8 https://youtu.be/RcYjXbSJBN8 especially the parts where he talks about Neuralink, Mind Virus..
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- nazgulnarsil 6y agoToo many smart people go into physics and math and try to build rockets rather than solve any of our actual problems as a species. Because logic puzzles are more fun.
- PeterStuer 6y agoThe kind of law and finance Musk is likely referring to is the chicken game red queen race. You need none of it unless your opponent reaches for it. A classic prisoners dilemma leeching value all around.
- kneel 6y agoSure there is a need for finance, but overall the industry is bloated field full of bad ideas, nepotism, leeches and outright corruption. Musk is absolutely correct. People need to go back to making real things.
- Traster 6y agoI don't think we should spend too much time taking Musk seriously. There are interesting discussions to be had about exponential returns and the structuring of society in a way that rewards producing things, but that's not relevant. This is just some guy trying to justify himself. >Making a car is an honest day’s living, that’s for sure Yes, and I'm sure the class of people who work in car factories and have seen their wealth drop further and further and further over the last 30 years really appreciate how honest their living is.
- ntsplnkv2 6y agoI agree, it gets old. But I do think his point needs to be taken. We don't value engineering/science/solving hard problems enough in the US.
- drobert 6y agoThat's definitely true in London for example. In software a job in a bank pays ~30% more. Fang companies pay on par or more in some cases but they have higher entry criteria. So if you want to buy a house, have a family, finance is a safe route. I work in an investment bank in IT and have colleagues from top universities doing boring jobs, at least in my view.
- justapassenger 6y agoElon’s actions are very good example why people go into those professions. He’s doing very high quality finance engineering at his companies and is constantly causing legal troubles. That ensures big demand for those professions.
- organicfigs 6y agoI posted about this the other day in the Finnish thread - of course they are, there's probably a 300% salary difference between a banker with 6 yoe and a social welfare worker with 12+ yoe. You don't have fields attracting people for purely financial incentives when the salary difference between these two is more like 10-20% for a seasoned professional. It's an entire systematic issue which has compounding effects, but when you mix in global instability, food security, etc. would you rather play ball here or expatriate and take a risk with the educational and career opportunities your children have somewhere else.
- to11mtm 6y agoIDK how to respond to that. It's an industry that pays better. In my career as a software dev, my options have fallen into three categories: - Projects interesting and challenging enough to devote time to, but subpar pay. - Good pay but absolutely boring, career ending, mind numbing work. - Go to Fintech, work hard, get to work on interesting things, get paid well. At least as far as finance in software is concerned, the smart people go into it because it's one of the few fields where there's a better chance that there are interesting problems to be solved. Finance is the only industry I've worked in that paid more than lip service to scaling and high availability. Admittedly, at least part of this is because of my location in the USA, and C# as my language of choice.
- 5cott0 6y ago> ‘Too many smart people go into finance and law’ This is overly simplistic black and white thinking. Jane Street has probably done more to popularize functional programming then any shop out there. Even people who make stuff need effective legal counsel. Even if all they make is memes that get them sued for libel.
- amai 6y agoThey go where the money is!
- Supersaiyan_IV 6y agoIt should say "too many people waste their innate talents on areas invented solely by our crappy social structure".