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Much respect to those on the front lines of these power battles. It seems like we are doomed to repeat these cycles because the necessary tension between labor

Much respect to those on the front lines of these power battles. It seems like we are doomed to repeat these cycles because the necessary tension between labor and capital. I'd love to hear any ideas on how we could shorten this feedback loop so we don't have to so closely approach the precipice.

runarberg 5y ago
I’ve never studied philosophy nor economy so I don’t know relevant it is today, but Karl Marx had some ideas on how to fix this situation and wrote about it in Das Kapital. The short answer is basically democratize the workplace. Instead of a CEO and shareholders making decisions for the workers. The workers should have to powers to pick their own benefits from the profits they are creating.
- cscurmudgeon 5y ago
  > I don’t know relevant it is today, but Karl Marx had some ideas on how to fix this situation and wrote about it in Das Kapital You can do that but can't force customers to buy from you.
- TrispusAttucks 5y ago
  I am slightly familiar with Marxism. One point I never understood is that Marxist philosophy is almost always applied as a solution to a currently capitalist economy. What are the Marxist incentives for new business creation as opposed to just reforming an existing capitalist company?
  - Kbelicius 5y ago
    > What are the Marxist incentives for new business creation I also am not very familiar with Marxism so all I can tell you is that humans, generally, are driven by many things and not just by profit.
    - missedthecue 5y ago
      Honestly, I'd rather work in a company managed by a profit seeker rather than someone who sought personal power or fame.
  - hnbad 5y ago
    > What are the Marxist incentives for new business creation as opposed to just reforming an existing capitalist company? I'm not sure I understand your question. Capitalism is fairly recent. In fact "businesses" are fairly recent. Humanity didn't idle until someone came up with the idea of corporations, so I don't think you're asking how production or innovation can happen under models compatible with Marxism without reforming existing companies. Under capitalism, the incentives for new worker coops are the same as for working for an existing company, i.e. not starving to death (or avoiding poverty). Capitalism aside, humans have many incentives for productive work. Research actually shows that intrinsic motivation can greatly exceed extrinsic motivation (e.g. being paid) but adding the latter can almost entirely eliminate the former, chronically: introducing money makes it a transaction rather than a favor. If your question is why anyone would found a new fruit juice company under Marxist philosophy to compete with the existing reformed ex-capitalist fruit juice companies and claim some of their market share, I think you're still thinking in capitalism.
- NhanH 5y ago
  That's basically just cooperative, and the main issue is that they end up not being competitive with corporation. We used to have a lot of cooperatives in Vietnam, they got outcompete by capitalist corporation over the past 20 years.
  - runarberg 5y ago
    Yeah, Carl Marx died in 1883. The economy has changed a lot since then so perhaps his ideas shouldn’t be taken at face value. However I believe he saw his solutions as being applied on a societal level, i.e. no single corporation could fix this on its own. Socialists today still believe this and seek regulatory frameworks which will enable cooperatives to thrive in a better economy, and not simply be out-competed by capitalist corporations as they are today.
    - m_ke 5y ago
      Yeah there's a podcast called "all things co-op" that covers this in detail. https://podcasts.apple.com/us/podcast/all-things-co-ops-podcast/id1479409897 https://podcasts.apple.com/us/podcast/all-things-co-ops-podc...
- robocat 5y ago
  Many co-ops are exactly that - owned by the workers. The question is: why are co-ops relatively uncommon?
  - m_ke 5y ago
    It's really hard for them to raise capital, even getting loans from a bank is a challenge. For anyone that's interested there's a new coop startup accelerator https://www.start.coop/ https://www.start.coop/
    - robocat 5y ago
      So I am guessing the banks problem is dealing with an abnormal legal situation. What if it is structured as a private LLC owned 100% by a holding co-op, and the LLC borrows money? Or is the problem that there are other risks for the bank?
  - dcolkitt 5y ago
    Because by and large they tend to be extremely poorly managed. Research has show time and time again that large multinationals have much more effective management practices. In almost any competitive market, multinationals will eventually dominate the industry because of their higher efficiencies.
    - codingdave 5y ago
      > have much more effective management practices OK, but what are the criteria for that? If the measurement is "most money, fastest, for the owners", than we aren't even talking about the same things. I live in the country where my utilities are all provided by small local co-ops. There are co-op grocery stores, too. As a customer, they all work quite well. They wouldn't impress an investor, but that isn't the point - they get the job done to support our community. Getting the job done is my measuring stick.
      - inglor_cz 5y ago
        The examples you gave are in sectors where technological change is slow. A grocery store of 2021 isn't that different from a grocery store of 2001. Co-ops will find it much harder to compete in sectors where a new model is expected every few months, such as smartphones.
- jandrewrogers 5y ago
  This is “decision by committee” in practice, with all the issues relating to decision quality and operational tempo that entails. They are empirically inefficient, so other organizational structures very effectively outcompete them.
  - roenxi 5y ago
    That sounds like a badly designed co-op, surely the better approach would be to swap the shareholders for the workforce and keep executive power centralised in a CEO? I don't think anyone has an argument in favour of a committee making every single decision. The advantage of the co-op model is that the shareholders are all domain experts and the workforce would be maximally incentivised to pursue profits.
  - hnbad 5y ago
    No, you're thinking of Soviet-style central planning. The idea of worker democracy is not to vote on every single decision. You can still delegate tactical decision making and even overall strategic planning to individuals and in fact usually this is what happens. The difference is the power dynamic when a disagreement arises. The idea is consent, not compromise. In hierarchical companies, the hierarchy decides everything and if anyone from below disagrees they can either fall in line or leave. This incentivizes those at the top to chase the profitability that benefits themselves most, which can often mean high bonuses short-term before moving on to a different company or aiming to sell off the company rather than build a sustainable business. Cooperatives are actually fairly resilient and often also aim to strengthen their local communities. > empirically inefficient This doesn't mean anything if you don't qualify your metric. If you define efficiency in terms of profitability you're defining it in terms of surplus value after expenses including salaries that can be paid out to shareholders. Using that metric is nonsensical as the workers ARE the shareholders. If you mean for manufacturing coops the goods tend to be more expensive you're probably not accounting for externalities. > other organizational structures very effectively outcompete them This isn't really true either, unless you define success in terms of growth rather than sustainability, in which case the claim becomes almost tautological: coops tend to be designed to focus on sustainability almost by definition, so of course they'll perform worse when you measure them by growth rather than sustainable profitability.
- etherwaste 5y ago
  Marxism isn't when you have coops under the capitalist mode of production, because things are still being produced for the sake of profit, not for social and common, and it still has the effect of making living labour serve accumulated labour, among other factors. That being said, worker coops are a good thing and are often more stable and efficient than conventional businesses^1 (not to mention leading to better outcomes for the workers). The problem comes with economy of scale when it comes to competing against accumulated labour (startup capital is a problem, and by the nature of taking startup capital you are working to multiply the exchange value of accumulated labour). The living labour of the worker coop will still likely be at work to maximize the exchange value of some other's accumulated labour (loans, contracts, etc) or become of the M-C-M model themselves, siding with accumulated labour class (bourgeoisie). That's capital for you. 1: https://www.democracyatwork.info/what_do_we_really_know_about_worker_cooperatives https://www.democracyatwork.info/what_do_we_really_know_abou...
robcohen 5y ago
Strongest idea I'm aware of is radical pay transparency. If everyone's full pay and benefits were public knowledge, negotiation would be essentially algorithmic. The information asymmetry currently benefits capital greatly, but if we can overcome the cultural blocks to pay transparency, I am confident almost everyone will be better off. It's late, so I won't find the sources for this, but there is ample evidence of the beneficial effects for labor negotiation. Consider the recent law where CEO bonuses would be public. After that, CEO pay actually went up because it was easier for them to negotiate.
- freefrog334433 5y ago
  Asking about someone's salary is normal in Cambodia, and in a Telecommunications company I worked, everyone knew each other's salary, which worked well. HR would send memos asking people not to discuss salary, as they couldn't play games. I used to tell people we were hiring to increase their asking salary, because I was tired of going to HR after their first week, when they realised they were being underpaid, and asking for raises for them.
- tw04 5y ago
  > Strongest idea I'm aware of is radical pay transparency. This falls apart immediately. Executive compensation is radically transparent at every publicly traded company and yet people are just ok with the Grand Canyon sized gap that has grown between average worker and executives over the last 40 years.
  - derac 5y ago
    How does an individual worker leverage CEO pay transparency to negotiate higher pay?
  - robcohen 5y ago
    What? How would executive pay transparency help workers? If worker pay is transparent for all positions, that would help negotiations. Merely making executive pay transparent does nothing to help anyone other than the executives.
  - 5y ago
Glyptodon 5y ago
Remove healthcare and retirement benefits from employers' purview, then tax employers on the difference between their wages and 1.25x the poverty line (including the typical cost of healthcare and 5% or 10% for retirement) in the positions' primary work county at a rate like 2.5x. Basically set a floor on compensation that's liveable.
- Avicebron 5y ago
  Is this an abstracted healthcare and retirement for all plan or is this, give everyone more money and they can figure it out, free market deal? I'm a little confused, generally healthcare and retirement are good things to have at work, so from where I see it, everyone should get it from their employer regardless of job or you're advocating using it to disburse to a healthcare for all scenario (EDIT: via the gov't) (which I'm all for). Side Note: For whoever is not the last one to the party like me, I just listened to a fascinating podcast (bbc) on David Ricardo's impact in economic theory, and a lot of the ills of today pretty much lay at his narcissistic feet. I would highly recommend taking a deep dive into how his economic policies actually make any mathematical sense and have influenced (conscious or not, the absurdity of modern markets and by extension modern business practices). /aside.
  - Glyptodon 5y ago
    Abstracted, I'm not super opinionated about private sector vs public sector health care, but I'm very opinionated about employer provided healthcare being a not good idea - it turns into a fight where employees have to follow the moral dicta of the employer even if it's not something the employee agrees with, not to mention it's obnoxious to have it change and go through COBRA or exchanges for 3 month shots every time you change jobs. And that it messes up effective cost sharing. Not to mention people who won't change jobs because they're afraid of healthcare changes or losing it. Retirement is similar - retirement benefits are used in manipulative ways by employers to make the labor market less competitive (vesting schedules, match timing and amounts, etc.). And for 401k-style plans, there's no reason your employer should decide for you which terrible high-fee investments you can use.
mbar84 5y ago
More and smaller companies. More labour mobility. If companies are in competition and people can move, then wages will be bid up close to their level of productivity.
ren_engineer 5y ago
skin in the game, people in power don't face any consequences for their actions and in many cases are completely oblivious to what life is like for the average person. America is completely divided from one another, if somehow we could get people to "walk a mile in somebodies shoes", I think there would be a lot more empathy for workers. How many Wall Street execs have had to go to the Rust Belt and see the consequences of their actions first hand? Instead they just call it flyover country and don't have to see it. Same applies to Silicon Valley honestly, I know a therapist who works for Google and they struggle with the job because of how entitled most Google employees are. Vast majority of them have no clue how good they have it compared to 99% of the population
- lotsofpulp 5y ago
  What was the alternative when the world was offering labor for 20% of the price? The US closes its border and trades amongst itself?
  - ren_engineer 5y ago
    you can go for economic efficiency without the massive increase in income inequality if you spread the wealth to some degree. This is also ignoring the externalities that Wall Street ignored, like the impact of China now having a bigger economy than the US because we literally built them up. Short term thinking in the name of profit is the root cause. The government should be the check on that type of thinking, but the major corporations have bought off most of the government
  - mdorazio 5y ago
    Many options were available. Tariffs, enforcement of environmental and working standards for foreign producers, taxation of companies outsourcing production and labor, distribution of a portion of savings to impacted workers, etc. For the most part the US chose none of these in favor of maximizing short-term profits.
- SauciestGNU 5y ago
  I live in the rust belt and I've been spending a lot of time in a homeless encampment helping people resist forced eviction by the city. The overwhelming majority even of relatively economically deprived people around me have no idea how much people are struggling. Literally out of sight out of mind. Walking in those shoes would be great, but I'd take even basic acknowledgement at this point.
everybodyknows 5y ago
>shorten this feedback loop Lasting help on this cannot be had in any short time, because cultural change is required: A citizenry engaged with and learning about government at a practical, local level -- rather than playing games to maximize the volume and audience of their own ranting. Schools would have to teach concepts like "regulatory capture", "rule of law rather than of men", "plausible deniability" -- along with the fundamental math, economics, and cultural history needed to apply them. And parents would have to inspire their children to some effort in outward, altruistic directions, rather than inward, to their own immediate pleasure. It starts with families, and with schools.

runarberg 5y ago

I’ve never studied philosophy nor economy so I don’t know relevant it is today, but Karl Marx had some ideas on how to fix this situation and wrote about it in Das Kapital. The short answer is basically democratize the workplace. Instead of a CEO and shareholders making decisions for the workers. The workers should have to powers to pick their own benefits from the profits they are creating.

cscurmudgeon 5y ago
> I don’t know relevant it is today, but Karl Marx had some ideas on how to fix this situation and wrote about it in Das Kapital You can do that but can't force customers to buy from you.
TrispusAttucks 5y ago
I am slightly familiar with Marxism. One point I never understood is that Marxist philosophy is almost always applied as a solution to a currently capitalist economy. What are the Marxist incentives for new business creation as opposed to just reforming an existing capitalist company?
- Kbelicius 5y ago
  > What are the Marxist incentives for new business creation I also am not very familiar with Marxism so all I can tell you is that humans, generally, are driven by many things and not just by profit.
  - missedthecue 5y ago
    Honestly, I'd rather work in a company managed by a profit seeker rather than someone who sought personal power or fame.
- hnbad 5y ago
  > What are the Marxist incentives for new business creation as opposed to just reforming an existing capitalist company? I'm not sure I understand your question. Capitalism is fairly recent. In fact "businesses" are fairly recent. Humanity didn't idle until someone came up with the idea of corporations, so I don't think you're asking how production or innovation can happen under models compatible with Marxism without reforming existing companies. Under capitalism, the incentives for new worker coops are the same as for working for an existing company, i.e. not starving to death (or avoiding poverty). Capitalism aside, humans have many incentives for productive work. Research actually shows that intrinsic motivation can greatly exceed extrinsic motivation (e.g. being paid) but adding the latter can almost entirely eliminate the former, chronically: introducing money makes it a transaction rather than a favor. If your question is why anyone would found a new fruit juice company under Marxist philosophy to compete with the existing reformed ex-capitalist fruit juice companies and claim some of their market share, I think you're still thinking in capitalism.
NhanH 5y ago
That's basically just cooperative, and the main issue is that they end up not being competitive with corporation. We used to have a lot of cooperatives in Vietnam, they got outcompete by capitalist corporation over the past 20 years.
- runarberg 5y ago
  Yeah, Carl Marx died in 1883. The economy has changed a lot since then so perhaps his ideas shouldn’t be taken at face value. However I believe he saw his solutions as being applied on a societal level, i.e. no single corporation could fix this on its own. Socialists today still believe this and seek regulatory frameworks which will enable cooperatives to thrive in a better economy, and not simply be out-competed by capitalist corporations as they are today.
  - m_ke 5y ago
    Yeah there's a podcast called "all things co-op" that covers this in detail. https://podcasts.apple.com/us/podcast/all-things-co-ops-podcast/id1479409897 https://podcasts.apple.com/us/podcast/all-things-co-ops-podc...
robocat 5y ago
Many co-ops are exactly that - owned by the workers. The question is: why are co-ops relatively uncommon?
- m_ke 5y ago
  It's really hard for them to raise capital, even getting loans from a bank is a challenge. For anyone that's interested there's a new coop startup accelerator https://www.start.coop/ https://www.start.coop/
  - robocat 5y ago
    So I am guessing the banks problem is dealing with an abnormal legal situation. What if it is structured as a private LLC owned 100% by a holding co-op, and the LLC borrows money? Or is the problem that there are other risks for the bank?
- dcolkitt 5y ago
  Because by and large they tend to be extremely poorly managed. Research has show time and time again that large multinationals have much more effective management practices. In almost any competitive market, multinationals will eventually dominate the industry because of their higher efficiencies.
  - codingdave 5y ago
    > have much more effective management practices OK, but what are the criteria for that? If the measurement is "most money, fastest, for the owners", than we aren't even talking about the same things. I live in the country where my utilities are all provided by small local co-ops. There are co-op grocery stores, too. As a customer, they all work quite well. They wouldn't impress an investor, but that isn't the point - they get the job done to support our community. Getting the job done is my measuring stick.
    - inglor_cz 5y ago
      The examples you gave are in sectors where technological change is slow. A grocery store of 2021 isn't that different from a grocery store of 2001. Co-ops will find it much harder to compete in sectors where a new model is expected every few months, such as smartphones.
jandrewrogers 5y ago
This is “decision by committee” in practice, with all the issues relating to decision quality and operational tempo that entails. They are empirically inefficient, so other organizational structures very effectively outcompete them.
- roenxi 5y ago
  That sounds like a badly designed co-op, surely the better approach would be to swap the shareholders for the workforce and keep executive power centralised in a CEO? I don't think anyone has an argument in favour of a committee making every single decision. The advantage of the co-op model is that the shareholders are all domain experts and the workforce would be maximally incentivised to pursue profits.
- hnbad 5y ago
  No, you're thinking of Soviet-style central planning. The idea of worker democracy is not to vote on every single decision. You can still delegate tactical decision making and even overall strategic planning to individuals and in fact usually this is what happens. The difference is the power dynamic when a disagreement arises. The idea is consent, not compromise. In hierarchical companies, the hierarchy decides everything and if anyone from below disagrees they can either fall in line or leave. This incentivizes those at the top to chase the profitability that benefits themselves most, which can often mean high bonuses short-term before moving on to a different company or aiming to sell off the company rather than build a sustainable business. Cooperatives are actually fairly resilient and often also aim to strengthen their local communities. > empirically inefficient This doesn't mean anything if you don't qualify your metric. If you define efficiency in terms of profitability you're defining it in terms of surplus value after expenses including salaries that can be paid out to shareholders. Using that metric is nonsensical as the workers ARE the shareholders. If you mean for manufacturing coops the goods tend to be more expensive you're probably not accounting for externalities. > other organizational structures very effectively outcompete them This isn't really true either, unless you define success in terms of growth rather than sustainability, in which case the claim becomes almost tautological: coops tend to be designed to focus on sustainability almost by definition, so of course they'll perform worse when you measure them by growth rather than sustainable profitability.
etherwaste 5y ago
Marxism isn't when you have coops under the capitalist mode of production, because things are still being produced for the sake of profit, not for social and common, and it still has the effect of making living labour serve accumulated labour, among other factors. That being said, worker coops are a good thing and are often more stable and efficient than conventional businesses^1 (not to mention leading to better outcomes for the workers). The problem comes with economy of scale when it comes to competing against accumulated labour (startup capital is a problem, and by the nature of taking startup capital you are working to multiply the exchange value of accumulated labour). The living labour of the worker coop will still likely be at work to maximize the exchange value of some other's accumulated labour (loans, contracts, etc) or become of the M-C-M model themselves, siding with accumulated labour class (bourgeoisie). That's capital for you. 1: https://www.democracyatwork.info/what_do_we_really_know_about_worker_cooperatives https://www.democracyatwork.info/what_do_we_really_know_abou...

robcohen 5y ago

Strongest idea I'm aware of is radical pay transparency. If everyone's full pay and benefits were public knowledge, negotiation would be essentially algorithmic. The information asymmetry currently benefits capital greatly, but if we can overcome the cultural blocks to pay transparency, I am confident almost everyone will be better off. It's late, so I won't find the sources for this, but there is ample evidence of the beneficial effects for labor negotiation. Consider the recent law where CEO bonuses would be public. After that, CEO pay actually went up because it was easier for them to negotiate.

freefrog334433 5y ago
Asking about someone's salary is normal in Cambodia, and in a Telecommunications company I worked, everyone knew each other's salary, which worked well. HR would send memos asking people not to discuss salary, as they couldn't play games. I used to tell people we were hiring to increase their asking salary, because I was tired of going to HR after their first week, when they realised they were being underpaid, and asking for raises for them.
tw04 5y ago
> Strongest idea I'm aware of is radical pay transparency. This falls apart immediately. Executive compensation is radically transparent at every publicly traded company and yet people are just ok with the Grand Canyon sized gap that has grown between average worker and executives over the last 40 years.
- derac 5y ago
  How does an individual worker leverage CEO pay transparency to negotiate higher pay?
- robcohen 5y ago
  What? How would executive pay transparency help workers? If worker pay is transparent for all positions, that would help negotiations. Merely making executive pay transparent does nothing to help anyone other than the executives.
- 5y ago

Glyptodon 5y ago

Remove healthcare and retirement benefits from employers' purview, then tax employers on the difference between their wages and 1.25x the poverty line (including the typical cost of healthcare and 5% or 10% for retirement) in the positions' primary work county at a rate like 2.5x. Basically set a floor on compensation that's liveable.

Avicebron 5y ago
Is this an abstracted healthcare and retirement for all plan or is this, give everyone more money and they can figure it out, free market deal? I'm a little confused, generally healthcare and retirement are good things to have at work, so from where I see it, everyone should get it from their employer regardless of job or you're advocating using it to disburse to a healthcare for all scenario (EDIT: via the gov't) (which I'm all for). Side Note: For whoever is not the last one to the party like me, I just listened to a fascinating podcast (bbc) on David Ricardo's impact in economic theory, and a lot of the ills of today pretty much lay at his narcissistic feet. I would highly recommend taking a deep dive into how his economic policies actually make any mathematical sense and have influenced (conscious or not, the absurdity of modern markets and by extension modern business practices). /aside.
- Glyptodon 5y ago
  Abstracted, I'm not super opinionated about private sector vs public sector health care, but I'm very opinionated about employer provided healthcare being a not good idea - it turns into a fight where employees have to follow the moral dicta of the employer even if it's not something the employee agrees with, not to mention it's obnoxious to have it change and go through COBRA or exchanges for 3 month shots every time you change jobs. And that it messes up effective cost sharing. Not to mention people who won't change jobs because they're afraid of healthcare changes or losing it. Retirement is similar - retirement benefits are used in manipulative ways by employers to make the labor market less competitive (vesting schedules, match timing and amounts, etc.). And for 401k-style plans, there's no reason your employer should decide for you which terrible high-fee investments you can use.

mbar84 5y ago

More and smaller companies. More labour mobility. If companies are in competition and people can move, then wages will be bid up close to their level of productivity.

ren_engineer 5y ago

skin in the game, people in power don't face any consequences for their actions and in many cases are completely oblivious to what life is like for the average person. America is completely divided from one another, if somehow we could get people to "walk a mile in somebodies shoes", I think there would be a lot more empathy for workers. How many Wall Street execs have had to go to the Rust Belt and see the consequences of their actions first hand? Instead they just call it flyover country and don't have to see it. Same applies to Silicon Valley honestly, I know a therapist who works for Google and they struggle with the job because of how entitled most Google employees are. Vast majority of them have no clue how good they have it compared to 99% of the population

lotsofpulp 5y ago
What was the alternative when the world was offering labor for 20% of the price? The US closes its border and trades amongst itself?
- ren_engineer 5y ago
  you can go for economic efficiency without the massive increase in income inequality if you spread the wealth to some degree. This is also ignoring the externalities that Wall Street ignored, like the impact of China now having a bigger economy than the US because we literally built them up. Short term thinking in the name of profit is the root cause. The government should be the check on that type of thinking, but the major corporations have bought off most of the government
- mdorazio 5y ago
  Many options were available. Tariffs, enforcement of environmental and working standards for foreign producers, taxation of companies outsourcing production and labor, distribution of a portion of savings to impacted workers, etc. For the most part the US chose none of these in favor of maximizing short-term profits.
SauciestGNU 5y ago
I live in the rust belt and I've been spending a lot of time in a homeless encampment helping people resist forced eviction by the city. The overwhelming majority even of relatively economically deprived people around me have no idea how much people are struggling. Literally out of sight out of mind. Walking in those shoes would be great, but I'd take even basic acknowledgement at this point.

everybodyknows 5y ago

>shorten this feedback loop Lasting help on this cannot be had in any short time, because cultural change is required: A citizenry engaged with and learning about government at a practical, local level -- rather than playing games to maximize the volume and audience of their own ranting. Schools would have to teach concepts like "regulatory capture", "rule of law rather than of men", "plausible deniability" -- along with the fundamental math, economics, and cultural history needed to apply them. And parents would have to inspire their children to some effort in outward, altruistic directions, rather than inward, to their own immediate pleasure. It starts with families, and with schools.