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This is written more like a speech by a politician than as an attempt at analysis. The type of economic inequality that successful startups yield, and which ac

by pg 16y ago

This is written more like a speech by a politician than as an attempt at analysis. The type of economic inequality that successful startups yield, and which accounts for a lot of the entries in the Forbes 400, is described merely as a theory cherished by the rich, and dismissed with evidence it would be a compliment to call anecdotal. And while there's a lot of talk about how the rich own the government, he doesn't even attempt to analyze whether this is more or less true now than it was 50 years ago, when there was less economic inequality (on paper).

deleted 16y ago
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drgolf 16y ago
It lacks in analysis because it's an opinion piece for a general audience, hence the use of anecdotes. Its not an academic article. No offense, but your articles often use anecdotes to make a point. For example, you write: "As anyone who has worked for the government knows, the important thing is not to make the right choices, but to make choices that can be justified later if they fail." What evidence do you have of this? What about agencies like DARPA? Your statement could also apply to employees of large corporations. You are doing the same thing that Joe Stigliz did in the article (without his academic ethos)
- pg 16y ago
  I'm not complaining about the fact that this is, like my essays, in the form of an essay rather than an academic paper. I'm saying that it's a piece of advocacy rather than an attempt to figure out the truth. That's an important distinction. In advocacy, you start already knowing the conclusion you want to reach, and you try as hard as you can to convince the audience of it, the way a lawyer or a politician would. Whereas an essay, as the name implies, starts with a question, and from there you try to follow the truth wherever it leads. I wrote about this in "The Age of the Essay" (http://paulgraham.com/essay.html http://paulgraham.com/essay.html). There is not a mathematically sharp distinction between the two approaches, of course. A lawyer or politician will use the truth when it suits his purpose. And an essayist trying to follow the truth will inevitably have biases that cause him not to follow the truth as far down some roads as others. But though the two approaches form a continuum, and writers sometimes drift along it in the middle of a given piece, the distinction is a meaningful one.
  - bfe 16y ago
    The hardest thing for me going from studying physics and astronomy to law school was getting used to the idea of a form of learning that had little to do with figuring out truth.
qq66 16y ago
The Forbes 400 is mostly entrepreneurs but the "Forbes 40,000" is mostly financiers, only a small fraction of whom create net positive value.
- pg 16y ago
  I don't see any reason to assume the distribution of outcomes for financiers is flatter than that for entrepreneurs. Is there something about finance that should make that so?
- deleted 16y ago
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- onan_barbarian 16y ago
  The Forbes 400 contains a mix of entrepreneurs and inherited wealth, and tends to describe people as self-made if there is _any_ way of justifying that at all. For example, you typically might raise an eyebrow at the description of Philip Anschutz as 'self-made'... from Anschutz's wikipedia page: "Anschutz bought out his father's drilling company in 1961" (age 22) ... as you do. Paging down the list shows a quite interesting mix of self-made to lesser or greater extents, but a lot of Waltons and Rockerfellers... still. More broadly, the emphasis on the ultra-rich isn't enormously illuminating either way, although it's worth noting that a lot of the 'entirely self-made' ultra-rich come from extremely comfortable upper-middle-class backgrounds, most obviously Bill Gates. I would be suprised to hear any evidence supporting your "Forbes 40,000" line - got any, or are you just making it up?
- bokonist 16y ago
  Source?
  - qq66 16y ago
    No source since the "Forbes 40,000" doesn't exist but I can assure you that it's much more common to make $100m on Wall Street than in entrepreneurship. My direct manager when I interned at Lehman Brothers had probably socked away $50m himself.
ciamac 16y ago
There is a lot of empirical evidence supporting the fact that the rich "own" government, or, more precisely, that politicians vote in ways that are more correlated with beliefs of high income voters than other voters, and that politicians are responsive to contributions. See, for example, the references herein: http://econ-www.mit.edu/files/6348 http://econ-www.mit.edu/files/6348 Stiglitz is a serious economist and a Nobel laureate, there is data behind what he says, but bear in mind that he's writing this for Vanity Fair and not the American Economic Review.
onan_barbarian 16y ago
I like the use of the phrases "economic inequality that successful startups yield, and which accounts for a lot of the entries in the Forbes 400" and "evidence that it would be a complement to call ancedotal" in the same sentence. Despite the very visible presence of Gates, Buffer, Ellison, etc at the top of the list the Forbes 400 isn't exactly a startup playground (a lot of mineral wealth, the Waltons, a still-pretty decent whack of inherited $$$). The idea that American inequality en masse has much to do with startups is an idea that, well... let's just say it would be a compliment to call it sensible. I'm sure that the American environment has resulted in great inequalities of outcome among, say, _tech_ firms (e.g. big winners and losers rather than having IBM and the seven dwarves pootle along for decades) but this doesn't translate to a fraction of the effect of, say, big declines in the tax rate paid by the very rich, or changes in the USA's blend of manufacturing or service jobs. Not staking a position here either way, just saying that bringing startups into this is absurd navel-gazing. It's hard to see what you're achieving trying to undermine specific points in an opinion piece ("You didn't show evidence that X" looks a lot like "I think you're wrong about X but am trying to look like the bigger man here") with this rather pointless bit of drive-by snark.

by pg 16y ago

deleted 16y ago

[deleted]

drgolf 16y ago

It lacks in analysis because it's an opinion piece for a general audience, hence the use of anecdotes. Its not an academic article. No offense, but your articles often use anecdotes to make a point. For example, you write: "As anyone who has worked for the government knows, the important thing is not to make the right choices, but to make choices that can be justified later if they fail." What evidence do you have of this? What about agencies like DARPA? Your statement could also apply to employees of large corporations. You are doing the same thing that Joe Stigliz did in the article (without his academic ethos)

pg 16y ago
I'm not complaining about the fact that this is, like my essays, in the form of an essay rather than an academic paper. I'm saying that it's a piece of advocacy rather than an attempt to figure out the truth. That's an important distinction. In advocacy, you start already knowing the conclusion you want to reach, and you try as hard as you can to convince the audience of it, the way a lawyer or a politician would. Whereas an essay, as the name implies, starts with a question, and from there you try to follow the truth wherever it leads. I wrote about this in "The Age of the Essay" (http://paulgraham.com/essay.html http://paulgraham.com/essay.html). There is not a mathematically sharp distinction between the two approaches, of course. A lawyer or politician will use the truth when it suits his purpose. And an essayist trying to follow the truth will inevitably have biases that cause him not to follow the truth as far down some roads as others. But though the two approaches form a continuum, and writers sometimes drift along it in the middle of a given piece, the distinction is a meaningful one.
- bfe 16y ago
  The hardest thing for me going from studying physics and astronomy to law school was getting used to the idea of a form of learning that had little to do with figuring out truth.

qq66 16y ago

The Forbes 400 is mostly entrepreneurs but the "Forbes 40,000" is mostly financiers, only a small fraction of whom create net positive value.

pg 16y ago
I don't see any reason to assume the distribution of outcomes for financiers is flatter than that for entrepreneurs. Is there something about finance that should make that so?
deleted 16y ago
[deleted]
deleted 16y ago
[deleted]
onan_barbarian 16y ago
The Forbes 400 contains a mix of entrepreneurs and inherited wealth, and tends to describe people as self-made if there is _any_ way of justifying that at all. For example, you typically might raise an eyebrow at the description of Philip Anschutz as 'self-made'... from Anschutz's wikipedia page: "Anschutz bought out his father's drilling company in 1961" (age 22) ... as you do. Paging down the list shows a quite interesting mix of self-made to lesser or greater extents, but a lot of Waltons and Rockerfellers... still. More broadly, the emphasis on the ultra-rich isn't enormously illuminating either way, although it's worth noting that a lot of the 'entirely self-made' ultra-rich come from extremely comfortable upper-middle-class backgrounds, most obviously Bill Gates. I would be suprised to hear any evidence supporting your "Forbes 40,000" line - got any, or are you just making it up?
bokonist 16y ago
Source?
- qq66 16y ago
  No source since the "Forbes 40,000" doesn't exist but I can assure you that it's much more common to make $100m on Wall Street than in entrepreneurship. My direct manager when I interned at Lehman Brothers had probably socked away $50m himself.

ciamac 16y ago

There is a lot of empirical evidence supporting the fact that the rich "own" government, or, more precisely, that politicians vote in ways that are more correlated with beliefs of high income voters than other voters, and that politicians are responsive to contributions. See, for example, the references herein: http://econ-www.mit.edu/files/6348 http://econ-www.mit.edu/files/6348 Stiglitz is a serious economist and a Nobel laureate, there is data behind what he says, but bear in mind that he's writing this for Vanity Fair and not the American Economic Review.

onan_barbarian 16y ago

I like the use of the phrases "economic inequality that successful startups yield, and which accounts for a lot of the entries in the Forbes 400" and "evidence that it would be a complement to call ancedotal" in the same sentence. Despite the very visible presence of Gates, Buffer, Ellison, etc at the top of the list the Forbes 400 isn't exactly a startup playground (a lot of mineral wealth, the Waltons, a still-pretty decent whack of inherited $$$). The idea that American inequality en masse has much to do with startups is an idea that, well... let's just say it would be a compliment to call it sensible. I'm sure that the American environment has resulted in great inequalities of outcome among, say, _tech_ firms (e.g. big winners and losers rather than having IBM and the seven dwarves pootle along for decades) but this doesn't translate to a fraction of the effect of, say, big declines in the tax rate paid by the very rich, or changes in the USA's blend of manufacturing or service jobs. Not staking a position here either way, just saying that bringing startups into this is absurd navel-gazing. It's hard to see what you're achieving trying to undermine specific points in an opinion piece ("You didn't show evidence that X" looks a lot like "I think you're wrong about X but am trying to look like the bigger man here") with this rather pointless bit of drive-by snark.