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But like always they didn't stop once they were a bit profitable with a few ads, instead they got greedier and greedier and made their product worse once they

But like always they didn't stop once they were a bit profitable with a few ads, instead they got greedier and greedier and made their product worse once they captured most of the market, I have wonder if there can exist some variant of capitalism that punishes becoming a bit too greedy, like a soft ceiling (tied to the minimum wage) over which most of the profits go to taxes, and a hard one where all profits over that go to taxes plus mandatory social work by its owners/executives.

owenthejumper 1y ago
That capitalism technically already exists in the US. We have very strong monopoly laws. It's just...nobody is enforcing them. Unlike the 70's and 80's: https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System
- xp84 1y ago
  AT&T eventually gave up and agreed to divest of the RBOCs because they didn't like their chances with the regulators. Imagine a Big Tech company having so little faith today in their ability to manipulate the government between lobbying, campaign contributions, and the most modern and economical play, stroking the President's ego.
- nerdponx 1y ago
  Biden's FTC chair tried her best, but it didn't go anywhere because she had no support and Trump put an end to it. But both sides amirite?
- int_19h 1y ago
  It's because the laws were creatively reinterpreted to mean something very different from what the people who wrote them had in mind. https://en.wikipedia.org/wiki/The_Antitrust_Paradox https://en.wikipedia.org/wiki/The_Antitrust_Paradox
kelseyfrog 1y ago
> instead they got greedier and greedier and made their product worse once they captured most of the market I wouldn't necessarily put it that way because not Google, nor any company, has moral capacity. They don't have souls. What they do have are incentive structures, and those flip when the stock goes public. Pre-IPO: the board is mostly founders and VCs holding paper wealth. Their shares aren't liquid, so the only way they get paid is by making the pie way bigger for some future exit. That means "grow, grow, grow." and that means playing nice with customers. Post-IPO: the board is legally stuffed with "independent" directors, whose pay comes in RSUs tied to the stock price. Now the shares are instantly tradable, and shareholders who can bail in a quarter want to see results in a quarter. Directors translate that into exec comp, and suddenly management's job is "make the stock go up right now." Some theorists point out the obvious hack: take away the hot potato. Slow the game down. Make shares harder to flip, make earnings less frequent. If you could only trade stock once a year, you'd actually care what the company looks like in a year. If they only reported results annually, you'd be forced to think in years, not quarters. Upside: management can focus on products and customers instead of quarterly guidance theater. Downside: investors hate being locked up, and capital gets more expensive because people price in that illiquidity. Transparency drops, execs get more room to bullshit. It's a tradeoff: you can have maximum liquidity and hyper-efficient capital markets, but then you get short-term brain damage. Or you can slow the game down, but then you're basically asking people to trust managers more and accept worse capital efficiency. Nobody;s found the perfect middle yet. LTSE[1] tried, dual-class shares are a kludge, and otherwise we just live with the cycle: grow like crazy private, IPO, then spend the rest of your corporate life addicted to quarterly earnings. 1. https://ltse.com/ https://ltse.com/
- marcus_holmes 1y ago
  In the old days, companies were valued on their expected dividend. Share prices didn't move that much, and trading shares took time and had fees attached. You could speculate on share price moves, and people did, but the primary source of income from holding shares was dividends. Now it's the other way around. The primary source of gains from owing shares is speculation on the share price. Dividends are mostly ignored. The result of this is that share prices move not on "how well is the company likely to do?" but on "what do we think the share price will do in the next couple of months (at most) [0]?". It all becomes hype and rumour and speculation. Shareholders only care about the price, so boards are incentivised to only care about the price. And so on down. Generating hype about what the company is going to do becomes more important than actually doing it (I exaggerate, but not by much). This then leads to the short-term-ism that we see, and the hot potato effect. I think the answer would be to tax speculative profits. If you sell something for more than you bought it for, the government takes a cut. Specifically remove this from income tax calculations, because they have way too many loopholes, and make it more like VAT/GST; a tax payable at the point of the transaction. This would reduce the profits from speculation, and hopefully move the emphasis back onto dividends and longer-term thinking. [0] and obviously, for some privileged traders, the next couple of milliseconds
eru 1y ago
Not all places even have minimum wage laws. In any case, good luck designing your system in such a way that's (A) not trivial to bypass, and (B) doesn't gut the economy. As a customer (and worker and investor) you have to vote with your feet and wallet to show the market what you want and don't want in your companies.

owenthejumper 1y ago

That capitalism technically already exists in the US. We have very strong monopoly laws. It's just...nobody is enforcing them. Unlike the 70's and 80's: https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System

xp84 1y ago
AT&T eventually gave up and agreed to divest of the RBOCs because they didn't like their chances with the regulators. Imagine a Big Tech company having so little faith today in their ability to manipulate the government between lobbying, campaign contributions, and the most modern and economical play, stroking the President's ego.
nerdponx 1y ago
Biden's FTC chair tried her best, but it didn't go anywhere because she had no support and Trump put an end to it. But both sides amirite?
int_19h 1y ago
It's because the laws were creatively reinterpreted to mean something very different from what the people who wrote them had in mind. https://en.wikipedia.org/wiki/The_Antitrust_Paradox https://en.wikipedia.org/wiki/The_Antitrust_Paradox

kelseyfrog 1y ago

> instead they got greedier and greedier and made their product worse once they captured most of the market I wouldn't necessarily put it that way because not Google, nor any company, has moral capacity. They don't have souls. What they do have are incentive structures, and those flip when the stock goes public. Pre-IPO: the board is mostly founders and VCs holding paper wealth. Their shares aren't liquid, so the only way they get paid is by making the pie way bigger for some future exit. That means "grow, grow, grow." and that means playing nice with customers. Post-IPO: the board is legally stuffed with "independent" directors, whose pay comes in RSUs tied to the stock price. Now the shares are instantly tradable, and shareholders who can bail in a quarter want to see results in a quarter. Directors translate that into exec comp, and suddenly management's job is "make the stock go up right now." Some theorists point out the obvious hack: take away the hot potato. Slow the game down. Make shares harder to flip, make earnings less frequent. If you could only trade stock once a year, you'd actually care what the company looks like in a year. If they only reported results annually, you'd be forced to think in years, not quarters. Upside: management can focus on products and customers instead of quarterly guidance theater. Downside: investors hate being locked up, and capital gets more expensive because people price in that illiquidity. Transparency drops, execs get more room to bullshit. It's a tradeoff: you can have maximum liquidity and hyper-efficient capital markets, but then you get short-term brain damage. Or you can slow the game down, but then you're basically asking people to trust managers more and accept worse capital efficiency. Nobody;s found the perfect middle yet. LTSE[1] tried, dual-class shares are a kludge, and otherwise we just live with the cycle: grow like crazy private, IPO, then spend the rest of your corporate life addicted to quarterly earnings. 1. https://ltse.com/ https://ltse.com/

marcus_holmes 1y ago
In the old days, companies were valued on their expected dividend. Share prices didn't move that much, and trading shares took time and had fees attached. You could speculate on share price moves, and people did, but the primary source of income from holding shares was dividends. Now it's the other way around. The primary source of gains from owing shares is speculation on the share price. Dividends are mostly ignored. The result of this is that share prices move not on "how well is the company likely to do?" but on "what do we think the share price will do in the next couple of months (at most) [0]?". It all becomes hype and rumour and speculation. Shareholders only care about the price, so boards are incentivised to only care about the price. And so on down. Generating hype about what the company is going to do becomes more important than actually doing it (I exaggerate, but not by much). This then leads to the short-term-ism that we see, and the hot potato effect. I think the answer would be to tax speculative profits. If you sell something for more than you bought it for, the government takes a cut. Specifically remove this from income tax calculations, because they have way too many loopholes, and make it more like VAT/GST; a tax payable at the point of the transaction. This would reduce the profits from speculation, and hopefully move the emphasis back onto dividends and longer-term thinking. [0] and obviously, for some privileged traders, the next couple of milliseconds

eru 1y ago

Not all places even have minimum wage laws. In any case, good luck designing your system in such a way that's (A) not trivial to bypass, and (B) doesn't gut the economy. As a customer (and worker and investor) you have to vote with your feet and wallet to show the market what you want and don't want in your companies.