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One of the memes that you frequently see in the upper middle class left-leaning tech worker circles is that anything less than a worker co-op is ultimately an o

One of the memes that you frequently see in the upper middle class left-leaning tech worker circles is that anything less than a worker co-op is ultimately an organizational structure that is inequitable and exploitative to its labor force, leading to negative externalities for society at large. I'm 100% ignorant of the history of labor and of all philosophical dialectic around it, but I would love to form an opinion on this. Would someone mind steel manning both sides of that argument? E.g. I have questions like, if I'm the founder of a company and I sell it 10 years later and make most of the upside, did I exploit my employees because they didn't make as much as I did in the end?

susanasj 4y ago
I forgot I posted this comment so just seeing this but as an upper middle class lefty tech worker I'll offer an answer. I think your question is a bit too focused on the individual and not the system. I think it's actually difficult for founders to share the upside "equitably", whatever that means. Like, are there any examples of it actually happening? I suspect that the acquiring company frequently dictates terms that won't allow you to make every employee a millionaire because then what incentive do they have to work anymore. I think once you get to the multi billion dollar level of wealth it's difficult to get objective advice - many of the people surrounding you are just trying to please you to continue getting their slice of the vast wealth that you control. So just as a human it's hard to navigate that I think (this is me being sympathetic to billionaires, which I'm generally not). The much easier answer to me is just much higher taxes on wealth. Capitalism is not a system built to share resources equitably, but inequality can be tamed through taxes. If you as a founder see most of the upside, fine, but a lot of it will get redistributed to society through taxes, and theoretically your workers benefit from that. It also means it's not up to the whims of the individual people or companies involved in something like an acquisition to try to make it equitable. (another way inequality in capitalism can be tamed is through unions, but I don't know if there are any examples of unions being involved in something like an acquisition or IPO in tech)
scarmig 4y ago
Argument for the meme: Labor unions don't challenge the core structure of capitalism; even when they're working, they mostly serve to give a slightly bigger piece of the pie to workers. And in practice, they are hijacked by a certain bureaucratic caste that mostly optimizes for stability and self perpetuation. They become integrated with state sponsorship, which will never allow for substantive change. For instance, in the USA the general strike was a powerful tool in the arsenal of workers' power and drove substantial wage gains, but disrupted capital too much and as such is banned by the NLRB. Since unions' scope is limited to accounting, law, and mediation, they become mostly administrative organizations staffed increasingly by members of the professional services class. These people can never provide leadership that primarily serves the working class, as their economic interests diverge and they can't do anything that would threaten their social good standing. Argument against: An economy dominated by worker co-ops is just wishful thinking. We have no idea how to get from point A to B, and no idea if it would even work. The limited evidence we have for that kind of economic structure comes from post WW2 Yugoslavia and suggests it wouldn't ("they just didn't do it right!" invites the question of how we do do it right). Conventional unions do shift some of the capital pie to workers, and we shouldn't let a very hypothetical best be the enemy of the concrete good. And even if worker co-ops are the ideal, any path that gets us there requires more worker power, so stronger unions would be a good first step to getting us to that point.
- bobthepanda 4y ago
  Also, in favor of point b, both can coexist, the same way that TV did not entirely eliminate the radio.
- nightski 4y ago
  Nothing is stopping anyone from forming a worker coop in the US. Yet few do. Have you ever considered this?
  - scruple 4y ago
    I have, yes, and I've gone as far as finding friends and former colleagues who would be interested in joining me. Unfortunately health insurance is tied to employment in this country and we all have families. The uncertainty in that regard leaves it a non-starter for people in our situation. At least for the time being.
runarberg 4y ago
This is a really good question, and there isn’t a clear answer. I’m only answering this from the left point of view though, so take it with a pinch of salt. Traditional labor theory can make arguments for both, if you put in most of the work, then you deserve most of the benefits. However the case for equal pay is also solid, especially if the fruits of labor are abundant. How much does 5 million give you that 1 million doesn’t, and why shouldn’t you settle for 1 million if it means everyone would get more? But from a leftist perspective there is a fault in the question (but it is still a good question). Namely that you sell the business. In an ideal left world, you wouldn’t do that. The business belongs to the workers. If the workers can all form a consensus that it is time to leave the business and sell it to another set of workers—those that leave will be bought out basically—then this is a valid scenario. However if under a new leadership, some workers are receiving more benefits then others, then that is exploitation. I would say actually that the new leadership is exploiting their previous workforce by spending the money the workers created by buying a new business without their consent. So in short, you as the founder of the business that was bought, are enabling exploitation by selling it to a larger organization (unless you sell it to a worker owned and operated business).
- erik_seaberg 4y ago
  Workers can bank their paychecks and walk away at any time. They would deserve more of the benefits if they bore more of the risks of failure, like investors are doing.
  - runarberg 4y ago
    Yes, as a leftist, I’m not a believer in that. I’m of the opinion that the supposed risk that investors take is overstated. The average investor is quite wealthy compared to most workers, and can afford to loose a bunch of that money without it causing significant harm, even leaving the investor still significantly wealthier then the worker. On top of that, many investors have insurance, or a wide portfolio of low risk stocks, guaranteeing them continued exploitation without risking much. Compare this to a worker, most of whom can’t afford to go without paychecks for a single month. Meaning that the loss of a job is far riskier then the investor’s supposed risk of loosing their investment. This transaction between an investor and a worker (if you look at it as a transaction) is always biased significantly towards the investor, they will grab proportionally more of the profit and tank less of the loss. So I would say the average worker is both risking a lot more and reaping less of the benefits.
edent 4y ago
The traditional view is that "The workers control the means of production". Suppose you built a successful small company but, suddenly, every employee quit at once. Could your business carry on the next day? Could it survive until you hired and trained replacements? If the answer is "no" then you have made the case that employees both deserve to share in the business's success and will probably be incentivised by co-owning the company. Does the janitor deserve as much of the profits as the CTO? Well, what premium do you put on your other employees not getting sick, or injuring themselves? (Wasn't there a case where a Google chef made a fortune from stocks? Much to the chagrin of some?) The opposite argument is that those who risk capital are the only ones who deserve the reward. Without investment, a company can't launch or grow. Workers are an operational cost - they are paid for labour and no more deserving of reward than the electricity company. Both provide a service but neither takes a risk.
- AnimalMuppet 4y ago
  Neither view will do. The company can't succeed without the workers. The company also can't succeed without capital. Both deserve to get a cut of the rewards.
  - edent 4y ago
    Exactly.
  - runarberg 4y ago
    This neglects the reality that loans exist. In an ideal leftist world your local credit union redistributes wealth by collecting pepole’s savings from the community and hands them out as loans for slightly higher interest rate. That interest rate is the “cut” of the rewards. If an enterprise goes bankrupt and is unable to pay back the loan, there is usually some kind of insurance the credit union has to prevent going under with it.
    - goatlover 4y ago
      That sounds like a world in which everyone ends up worse off. Maybe it’s more equal, but I value standard of living and opportunity more than equal outcomes.
berniedurfee 4y ago
Yes

susanasj 4y ago

I forgot I posted this comment so just seeing this but as an upper middle class lefty tech worker I'll offer an answer. I think your question is a bit too focused on the individual and not the system. I think it's actually difficult for founders to share the upside "equitably", whatever that means. Like, are there any examples of it actually happening? I suspect that the acquiring company frequently dictates terms that won't allow you to make every employee a millionaire because then what incentive do they have to work anymore. I think once you get to the multi billion dollar level of wealth it's difficult to get objective advice - many of the people surrounding you are just trying to please you to continue getting their slice of the vast wealth that you control. So just as a human it's hard to navigate that I think (this is me being sympathetic to billionaires, which I'm generally not). The much easier answer to me is just much higher taxes on wealth. Capitalism is not a system built to share resources equitably, but inequality can be tamed through taxes. If you as a founder see most of the upside, fine, but a lot of it will get redistributed to society through taxes, and theoretically your workers benefit from that. It also means it's not up to the whims of the individual people or companies involved in something like an acquisition to try to make it equitable. (another way inequality in capitalism can be tamed is through unions, but I don't know if there are any examples of unions being involved in something like an acquisition or IPO in tech)

scarmig 4y ago

Argument for the meme: Labor unions don't challenge the core structure of capitalism; even when they're working, they mostly serve to give a slightly bigger piece of the pie to workers. And in practice, they are hijacked by a certain bureaucratic caste that mostly optimizes for stability and self perpetuation. They become integrated with state sponsorship, which will never allow for substantive change. For instance, in the USA the general strike was a powerful tool in the arsenal of workers' power and drove substantial wage gains, but disrupted capital too much and as such is banned by the NLRB. Since unions' scope is limited to accounting, law, and mediation, they become mostly administrative organizations staffed increasingly by members of the professional services class. These people can never provide leadership that primarily serves the working class, as their economic interests diverge and they can't do anything that would threaten their social good standing. Argument against: An economy dominated by worker co-ops is just wishful thinking. We have no idea how to get from point A to B, and no idea if it would even work. The limited evidence we have for that kind of economic structure comes from post WW2 Yugoslavia and suggests it wouldn't ("they just didn't do it right!" invites the question of how we do do it right). Conventional unions do shift some of the capital pie to workers, and we shouldn't let a very hypothetical best be the enemy of the concrete good. And even if worker co-ops are the ideal, any path that gets us there requires more worker power, so stronger unions would be a good first step to getting us to that point.

bobthepanda 4y ago
Also, in favor of point b, both can coexist, the same way that TV did not entirely eliminate the radio.
nightski 4y ago
Nothing is stopping anyone from forming a worker coop in the US. Yet few do. Have you ever considered this?
- scruple 4y ago
  I have, yes, and I've gone as far as finding friends and former colleagues who would be interested in joining me. Unfortunately health insurance is tied to employment in this country and we all have families. The uncertainty in that regard leaves it a non-starter for people in our situation. At least for the time being.

runarberg 4y ago

This is a really good question, and there isn’t a clear answer. I’m only answering this from the left point of view though, so take it with a pinch of salt. Traditional labor theory can make arguments for both, if you put in most of the work, then you deserve most of the benefits. However the case for equal pay is also solid, especially if the fruits of labor are abundant. How much does 5 million give you that 1 million doesn’t, and why shouldn’t you settle for 1 million if it means everyone would get more? But from a leftist perspective there is a fault in the question (but it is still a good question). Namely that you sell the business. In an ideal left world, you wouldn’t do that. The business belongs to the workers. If the workers can all form a consensus that it is time to leave the business and sell it to another set of workers—those that leave will be bought out basically—then this is a valid scenario. However if under a new leadership, some workers are receiving more benefits then others, then that is exploitation. I would say actually that the new leadership is exploiting their previous workforce by spending the money the workers created by buying a new business without their consent. So in short, you as the founder of the business that was bought, are enabling exploitation by selling it to a larger organization (unless you sell it to a worker owned and operated business).

erik_seaberg 4y ago
Workers can bank their paychecks and walk away at any time. They would deserve more of the benefits if they bore more of the risks of failure, like investors are doing.
- runarberg 4y ago
  Yes, as a leftist, I’m not a believer in that. I’m of the opinion that the supposed risk that investors take is overstated. The average investor is quite wealthy compared to most workers, and can afford to loose a bunch of that money without it causing significant harm, even leaving the investor still significantly wealthier then the worker. On top of that, many investors have insurance, or a wide portfolio of low risk stocks, guaranteeing them continued exploitation without risking much. Compare this to a worker, most of whom can’t afford to go without paychecks for a single month. Meaning that the loss of a job is far riskier then the investor’s supposed risk of loosing their investment. This transaction between an investor and a worker (if you look at it as a transaction) is always biased significantly towards the investor, they will grab proportionally more of the profit and tank less of the loss. So I would say the average worker is both risking a lot more and reaping less of the benefits.

edent 4y ago

The traditional view is that "The workers control the means of production". Suppose you built a successful small company but, suddenly, every employee quit at once. Could your business carry on the next day? Could it survive until you hired and trained replacements? If the answer is "no" then you have made the case that employees both deserve to share in the business's success and will probably be incentivised by co-owning the company. Does the janitor deserve as much of the profits as the CTO? Well, what premium do you put on your other employees not getting sick, or injuring themselves? (Wasn't there a case where a Google chef made a fortune from stocks? Much to the chagrin of some?) The opposite argument is that those who risk capital are the only ones who deserve the reward. Without investment, a company can't launch or grow. Workers are an operational cost - they are paid for labour and no more deserving of reward than the electricity company. Both provide a service but neither takes a risk.

AnimalMuppet 4y ago
Neither view will do. The company can't succeed without the workers. The company also can't succeed without capital. Both deserve to get a cut of the rewards.
- edent 4y ago
  Exactly.
- runarberg 4y ago
  This neglects the reality that loans exist. In an ideal leftist world your local credit union redistributes wealth by collecting pepole’s savings from the community and hands them out as loans for slightly higher interest rate. That interest rate is the “cut” of the rewards. If an enterprise goes bankrupt and is unable to pay back the loan, there is usually some kind of insurance the credit union has to prevent going under with it.
  - goatlover 4y ago
    That sounds like a world in which everyone ends up worse off. Maybe it’s more equal, but I value standard of living and opportunity more than equal outcomes.

berniedurfee 4y ago

Yes