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The amount of negativity to this is depressing. No one seems to be contradicting anything he's saying here, instead it's just vacuous ideology "extraction" etc

• chipotle_coyote 4mo ago
  What if -- bear with me here -- it's possible for bright, motivated founders to create startups that your kids can work in, but those founders could be content with merely making a hundred million dollars? Because, and I don't know if you know this so you may have to take it on faith, that is still so much money that said founder and their family and very likely their descendants can live in extreme luxury for the rest of their lives even if they stop working right then. I don't know what the best solution to the problem of wealth inequality is, but I know that we need to collectively get over this "but if people think they will be limited to a mere hundred million dollars in wealth they will have no motivation whatsoever to work" nonsense. You know what the motivation is? It's still a hundred million dollars, that's what.
  • hparadiz 4mo ago
    [flagged]
    • calgoo 4mo ago
      what are you talking about????????? 100 million is a fortune, and only people in the SF bubble could even consider that a drop that is pissed into the wind. I would say that you need to take a serious step back and actually contemplate life around you. 100 million is a fortune, and no one actually NEED that much money, if they do, then they have lost touch with reality.
      • hparadiz 4mo ago
        In California that's only 100 homes. That's what's normal for us. Increased market efficiency should actually be lowering taxes, not increasing them just to make you feel good about yourself.
        • ceejayoz 4mo ago
          It's normal for someone to want 100 homes?
          • hparadiz 4mo ago
            Elon spent less than that to fund SpaceX and Tesla which are now bringing in money from abroad and therefore paying a lot more in taxes than whatever you would have collected from that 100 million. Now you can be a commie and seize more or of it to fund your healthcare or whatever but that person that is capable of earning 100 million will simply exit your tax jurisdiction and then you'll be poor. See Europe for the example.
            • ceejayoz 4mo ago
              > Elon spent less than that to fund SpaceX and Tesla... So 100 million is enough to do quite a bit with? > that person that is capable of earning 100 million will simply exit your tax jurisdiction There are plenty of lower tax jurisdictions than Silicon Valley. Is it possible there's more to a jurisdiction than the raw marginal tax percentage it applies to one's paycheck?
              • hparadiz 4mo ago
                It's not enough to build a data center these days. Or even run the government for a day these days it seems. Or are you saying salaries need to come down?
                • ceejayoz 4mo ago
                  The amount it costs to build a datacenter or run the government for a day is an unimaginable level of personal wealth to virtually every person on the planet.
  • photon_lines 4mo ago
    There is an alternative: 1) limit how much descendants can inherit. Allow them only a maximum amount of let's say: 10 million and make sure that either the founder finds a way to redistribute his/her wealth to the rest of the world, or make the government find ways of redistributing this money. 2) make it mandatory for corporations to share their wealth (income) with the employees -- as an example make it mandatory to redistribute 50% of the income generated to the employees working for the company rather than paying CEOs insane amounts of money to return 'shareholder value'. The whole motto of maximising shareholder value has poisoned capitalism: the goal of a company should not be to become a cancerous growth -- but to serve as a net good for humanity. 3) seal the tax loopholes that make it easy for the rich to avoid paying taxes. There is no reason why the poor and middle class pay a disproportionate amount in taxes compared to the rich.
  • Geniuzz 4mo ago
    > But those founders be content with merely making a hundred million? What does this mean? Without some insane wealth tax this is literally impossible. No founder chooses to become a billionaire. They just keep growing a business that is solving a billion dollar problem. The only other was is if after 100M they start turning down customers or restricting services.
    • jrajav 4mo ago
      This is conflating businesses that solve billion dollar problems with people who individually contribute so much to a business that they solved the billion dollar problem all on their own. The latter is probably possible, but it's not necessarily the case that all billionaires and up today were such individuals. It might be that if personal wealth alone were (effectively, by taxation) capped to $100m, we would still have exactly as much collective wealth, innovation, and value creation as we do today. Possibly more, because of more wealth distributed onto shared infrastructure and into the fluid economy.
    • therealdrag0 4mo ago
      They can continue growing the business while giving other employees a larger share of the asset. One person doesn’t create a billion dollar company, dozens or thousands do. After founding, other people who don’t become billionaires work similarly hard and are similarly smart as the founder. This is why people dispute “earning” a billion dollars.
      • nfw2 4mo ago
        You don't have a solution unless you can propose a way this gets legislated and executed. No hand waving. How specifically does this work? Suppose it is day one of my shares being worth more than 100m. What happens?
        • lkjdsklf 4mo ago
          It's pretty easy. You can just cap total compensation for executives relative to the lowest paid worker and include equity in that calculation. If you want to pay yourself, 10 million a year in stock, great... You need to pay the lowest paid person 10k in stock or whatever. Or, you can mandate that after a certain size a worker owned trust/union will own some percentage of the company. There's dozens of ways you could address this problem. Each have pros/cons. It's not that hard to fix if we actually wanted to fix it though.
  • sillysaurusx 4mo ago
    pg has an essay addressing exactly that: https://paulgraham.com/inequality.html https://paulgraham.com/inequality.html The problem is that when you cap earnings to $100m, most investors lose motivation to invest in startups, because their investment isn’t likely to yield a reward. Unless you think all investments should be less than $100m, this kills large investment rounds. That would have killed OpenAI, for example, since their recent round was larger. In other words, it’s fine to say “you can only earn a hundred million dollars.” The hard part is implementing it without killing the investment ecosystem. Every investor is chasing the big return that covers the 20 investments that didn’t pan out. If that big return is capped, there won’t be investment, and hence no startups.
    • yunwal 4mo ago
      I don't understand. Just because one person can't own 100 million doesn't mean an investment firm can't make a 100 million dollar investment and make returns on it. Those are 2 different things. The firm is managing the money of multiple people.
      • sillysaurusx 4mo ago
        And when one of those people breaks $100m, does the excess money go to the firm, or to taxes? Or are you saying that a company can have unlimited money, as long as the shareholders don’t extract more than $100m over the course of their lifetime? The ultimate point of money is for someone to have it. And since corporations are owned by people, it’s not enough to say that corporations aren’t bound to the $100m cap. Otherwise people will just hoard money using corporations, and take loans against their value, a bit like how it already works today. What counts as $100m? If you buy a million dollar house, then sell it a few years later for a million dollars, are you now limited to $99m since you already spent $1m? Does the money from selling the house go to taxes, or to you? If it goes to you, what’s to prevent someone from hoarding equity and only taking out $100m at a time, effectively living the life of a billionaire while keeping their balance under $100m? If you own some stock, and it rises in value to $150m, you forfeit $50m to taxes, right? But then if the value of the stock goes down by half, would you have $75m or $50m? And if the answer is “you have $150m, the cap only applies when selling stock,” then what stops people from putting the money under the custody of a business (which you said isn’t bound by the cap) and then taking loans against that extra $50m? These aren’t contrived scenarios. Stock goes up and down all the time, and it’s important to be clear about how the proposed system will work. I’m genuinely interested in answers. It’s easy to say “just cap someone’s wealth at $100m,” but people seem to shy away from proposing specifics.
  • imgabe 4mo ago
    Who is going to cap how much a company is allowed to be worth? Or how much of the company you start you are allowed to own? Why should anyone have the power to do that? That is a far more evil power than any billionaire has.
    • bluecheese452 4mo ago
      [flagged]
    • seventytwo 4mo ago
      We are. All of us. If enough of us agree, we can make any rule we want.
      • IcyWindows 4mo ago
        So "enough of us" can take anything by forcing the asset to be valued at an artificially high value, force them to sell it for taxes, and then reduce the price down again to keep it ourselves?
        • seventytwo 4mo ago
          Yep. That’s how democracy and law work.
          • imgabe 4mo ago
            Mob rule is not something to celebrate.
            • HauntedDrum 4mo ago
              How do you, personally, distinguish between democracy and mob rule?
              • imgabe 4mo ago
                In the extreme there is no distinction. This is why the US and almost every other democracy are not direct democracies.
  • bluedino 4mo ago
    > that is still so much money that said founder and their family and very likely their descendants can live in extreme luxury for the rest of their lives even if they stop working right then. Professional athletes and lottery winners prove otherwise.
  • lumost 4mo ago
    bear in mind, elon musk now has the wealth of 10k "100 millionaires" - we truly lack comprehension of how wealthy the wealthy have gotten.
  • WarmWash 4mo ago
    I think the most chronic misunderstanding in the "billionaire" rhetoric is that billionaires are in it for money. People who work a job they don't like because they need money to live, view money as the objective in life, because the equivocate it to escaping and freedom. So wearing that lens, and looking at billionaires, these motherfuckers are greed driven psychopaths who blew past the "escape with freedom" bank account ages ago, and are now just taking money off the table from others trying to get ahead. But that is not how it is at all. Virtually every billionaire is crazy focused on their work, and the money is a side effect that they don't really care that much about, besides it being a tool to enable more work they can do. It's very hard to get this across when speaking to people who view work as an obstacle, money as god, don't have personal business experience, and whose passions are things that aren't very productive.
    • barnabee 4mo ago
      If they’re not in it for the money, they’ll be happy to pay more tax
      • WarmWash 4mo ago
        Taxes are money that they lose control of. There is a reason Bill Gates didn't just write the IRS a check for $175B and created the Gates foundation instead.
        • lkjdsklf 4mo ago
          That's kind of the opposite of your original claim then. They're in it for the money as it allows them to exert control. That's still being in it for the money.
          • WarmWash 4mo ago
            They are in it for manually appreciating their own assets, which has the intrinsic effect of generating wealth. A better way to frame it that doesn't hinge on the colloquial vs literal meaning of "in it for the money".
  • JumpCrisscross 4mo ago
    > it's possible for bright, motivated founders to create startups that your kids can work in, but those founders could be content with merely making a hundred million dollars? Making a billion dollars doesn’t require becoming a billionaire. Someone who makes a billion dollars in a balanced society generates wealth and taxes. (One who does in an unbalanced one has the choice to donate.) Also, liquid versus illiquid. Founders shouldn’t be under obligation to cap their ambition or force liquidate if their companies do well.
    • bubblegumcrisis 4mo ago
      This is why the guillotine will either be taxes or blades. It's either Bernie or Luigi. There is a sizable segment of the population that just doesn't have any empathy for society at large. "There should never be a cap to my selfishness." You might think: I can argue with them. No. You can't. They literally couldn't care less about you or anyone else. They do, however fear retribution.
      • JumpCrisscross 4mo ago
        > This is why the guillotine will either be taxes or blades There is legitimate debate around whether the French aristocracy came out of the Revolution richer than they were before. > They do, however fear retribution They don’t. They haven’t been targeted. Luigi potted a middle manager with a glorified title. The billionaire who owns the group is fine. We need to raise taxes. We need new tax brackets. But pretending violence is a check on a globalized rich is just self-congratulatory fantasy. Worst case, they lose billions when they flee.
        • bubblegumcrisis 4mo ago
          I don't know about this. Pre-Trump I would have agreed with you. Post-Trump. The mask is off, and they are evil. How many billionaires are there? I don't think we'd miss them if they were gone. And it goes farther than this actually. Should we have publicly executed the cigarette CEOs, and those CEOs of the drug companies who knowingly destroyed so many lives with opiates? What about the company CEOs who poison water. Before Trump I would have said, "no." But now, "yes." They deserved it, and by not sufficiently punishing them for their crimes against humanity we sent a message to the likes of Facebook and OpenAI and the new batch of psychopaths, that there are no real consequences for their actions, no matter how base they are. If Trump and his family does not sit in jail after he leaves office, if the democrats do not exact retribution for all he and his ilk have done, I think there will be rioting against both sides. I don't know. Maybe I'm wrong. I actually hope I'm wrong. But I think I'm right. And even though this post will be down-voted for referencing violence as leverage, I think these ideas are mainstream now.
  • nfw2 4mo ago
    How exactly do you propose keeping a founder from becoming wealthier once their company scales past the point where they are worth a hundred million?
    • didibus 4mo ago
      tax?
      • pclowes 4mo ago
        On what? You force the company to break up and liquidate so they can pay taxes? You force the founder to give up their private property just because it is valuable? Remember these are not dollar bills in the founders bank account. It is just the company they created is now very valuable. It does not mean it is liquid.
        • paulryanrogers 4mo ago
          Owners being able to lock the value generated by workers solely within their family for generations has been tried. It ends in feudalism.
          • nfw2 4mo ago
            Are you proposing changing inheritance laws or are you proposing forcing companies to sell their stock in a firesale to be in accordance with the IRS? Be clear in your propositions please.
            • paulryanrogers 4mo ago
              Progressive taxation, taxes on CG, inheritance taxes, and a well funded and non-partisan IRS.
              • nfw2 4mo ago
                None of these will prevent someone from gaining more than 100M. That is what is under discussion. I am not against more progressive taxes. Which party is the IRS partisan towards? What do you mean by partisan?
  • anbende 4mo ago
    The primary issue with this is the way shares and equity work. Elon Musk is a trillionaire on paper. He pays himself famously little. That net worth is, under our current system, tightly linked with his interest and control in his various enterprises. He can borrow against it which gets around taxes and that should probably be addressed, but he like the hypothetical fresh billionaire startup founder don’t have that money. And the mega rich on paper can’t access more than a small percentage of that money without reducing their control of the company they built or are building. Ideas like a wealth tax, or the new sovereign fund paid into by an equities tax or grant are all interesting, but they are all more complicated on the ground than “wouldn’t $100m be motivating enough?” FWIW, I think that some sort of public endowment and/or sponsored healthcare, education and safety net and/or tax or management of hyper wealth is one of the problems of our age. But part of that problem is that it’s not clear how to do that in a way that is workable in an increasingly multipolar world of tech and soon healthcare giants that are as powerful as small but growing nation states. Economically and in some cases militarily linked to great powers.
    • jonfromsf 4mo ago
      Just don't step-up cost basis at death and you solve the problem. Elon's fine, we can wait until he dies and his heirs sell their shares.
      • the_sleaze_ 4mo ago
        1. End step-up cost basis at death 2. Tax or end lending against portfolios Seems like a solved problem to me.
    • rwmj 4mo ago
      Who is it that implements the rights around ownership? Who is it that will (possibly literally) go to war to defend this right? Maybe he should pay a bit of tax on this right since he expects others to defend it.
    • peab 4mo ago
      >He can borrow against it which gets around taxes and that should probably be addressed, but he like the hypothetical fresh billionaire startup founder don’t have that money. And the mega rich on paper can’t access more than a small percentage of that money without reducing their control of the company they built or are building. Yes, this is a good take. I wish more people understood this. Things like sales taxes could address this. Land value tax, with single homestead exemptions are another.
  • pclowes 4mo ago
    It is not like the money is in his bank account. And it’s not like he took the money from somebody else. He spent a ton of time to create something that he owned the majority of and to make that thing more valuable. He paid other people to help him and they were happy with that exchange. The government also helped them and they were happy with that exchange. Suddenly, people have assigned a concrete value to the thing via the IPO and it is very valuable. It’s not like he suddenly has $1 trillion in his account. It’s just the thing that he made and has ownership of is suddenly worth that much.
    • CPLX 4mo ago
      Of course he took the money from someone else. Is your theory that he dug it out of the ground with a shovel or something?
      • schoen 4mo ago
        That must be why there is exactly as much wealth now as there was in the year 600. We've all just been stealing it back and forth.
        • pclowes 4mo ago
          Thank you, I never thought debating economics on hacker news of all places would be the equivalent of discussing orbital mechanics with flat earthers.
          • CPLX 4mo ago
            I have a degree in economics and wrote my economics thesis on the application of complex adaptive systems to economic theory. I'm still quite attached to economic analysis, it's even the story behind my user name. You can be assured I understand the concept of wealth creation. But the fact that there are, in fact, other people involved here is hilariously hand-woven away here: > He paid other people to help him and they were happy with that exchange. The government also helped them and they were happy with that exchange. OK I will bite. Who determines what "the government" thinks in a democracy? The general public, right? Does the general public seem happy?
  • fn-mote 4mo ago
    Surely this would just create an industry of ways to dodge the “$100m tax”. Just waiting for my company’s top 10 shareholders to be anonymous entities owned by other companies based in the Cayman Islands.
    • sumeno 4mo ago
      Let's give it a try and see. Maybe better things ARE possible
    • paulryanrogers 4mo ago
      The rich being willing to cheat doesn't mean we should just give up and let them consume all surplus value in the system, until people are literally working 3 jobs for rent and food.
    • rwmj 4mo ago
      UK companies are forced to list beneficial owners, in order to cut through these kinds of shenanigans. It did take decades to get this change implemented because capital was deeply opposed to it. For some reason, I'm sure it's not because they want to avoid paying taxes like the little people.
  • soerxpso 4mo ago
    The entity you're implicitly proposing should take the money doesn't have a good track record of spending it wisely. I'd much rather let the startup founders keep their money and build rockets with it, than spend another few trillion on building 100 meters of high-speed rail.
    • patagurbon 4mo ago
      The whole problem with CalHSR is precisely that they can’t spend any real money… There were governmental barriers like CEQA and local NIMBYs but the primary cost culprit is that the legislature has continuously kicked fully funding the project down the tracks for the past two decades. Funding it fully with a 10-20 year construction timeline in the early 2010s would’ve far cheaper at this point. Every American economic miracle has been precipitated by the government building basic infrastructure and doing basic research.
      • ericd 4mo ago
        Does this contradict the comment you're replying to, somehow, or are you trying to prove their point?
      • anon291 4mo ago
        So it's pretty clear it's not the billionaires but random thousandaire loudmouths that are the problem then.
  • fallonator 4mo ago
    How about we set a maximum wage instead of a minimum wage? But it's not a set number. It is a maximum multiple of the lowest paid employee at a company? 10x should do it. If the CEO wants a million each year then the lowest paid employee still gets 100k. I'm trying to think of why this wouldn't work.
    • tensility 4mo ago
      The only reason it doesn't is the greed of folks who become billionaires.
    • perilunar 4mo ago
      Probably won't work because the ultra-wealthy don't get ultra-wealthy by earning wages.
  • yowlingcat 4mo ago
    What if -- bear with me here -- the very thing that makes those founders able to make the $1B they would otherwise make would drive them to also ask why it is that someone else who had no hand in building or funding it gets lion's share of the $900M while they get only $100M? You don't /know/ that people need to collectively get over "this" -- you have a feeling that it seems more fair to do that than the alternative. But you can look at what happens elsewhere in the world with regimes that implement exactly what you are describing. And what happens is the people who are most equipped to be the golden gooses that you are proposing are just as equipped to simply most somewhere they can do so unencumbered. That's why what you're proposing will just never really work.
  • peab 4mo ago
    I don't understand why people argue for a limit on wealth - the line of reasoning, when reasoned out, concludes with a majority of people having the exact same amount of wealth. How so? Well, suppose we say, nobody should be a trillionaire - is this an arbitrary number, or is it aimed at the richest person? Clearly, the latter. Now if we carried this out, now there are billionaires remaining. Well, nobody should be a billionaire, one might say. Most will agree. So the wealth of billionaires is taken away, and redistributed evenly. This will continue, with the majority of people below the average wealth level, demanding a more equal playing field. You can see how it ends
    • joquarky 4mo ago
      Is this not an exemplar of the slippery slope fallacy?
      • peab 4mo ago
        no, it's not. It's math. If you make a rule that you lower the person at the top of the pile, over time, there will be nobody left to lower - everybody will be at the top of the pile. The fact people say 1 billion is too much money, or 1 trillion is too much is something to dig into - the number is relative! 1 billion is only a lot because not many people have a billion dollars. If inflation keeps up, one day everybody will be a billionaire.
        • butlike 4mo ago
          > everybody will be at the top of the pile. Why is that a bad thing? Or will it exemplify some other non-financial inferior trait of the person which might be existentially 'scary?'
• justonepost2 4mo ago
  lol the next generation won’t be working in startups or anywhere else, all we have now is to hope and pray that we get a nice corner of the human zoo
• wat10000 4mo ago
  The post is patronizing as hell, it’s no wonder people respond to it negatively. Patting people on the head and saying “you moron, it’s just two numbers” isn’t a good way to make an argument.
  • old-gregg 4mo ago
    Sam Harris often makes an argument that I both hate and kind of agree with. He says that exchanging arguments and having a debate only works when the two arguing parties share a foundation. The debate’s purpose is to reconcile a measurable difference of opinion. In this case, I feel there’s no shared foundation. Half of the commenters here don’t seem to understand what money is or how it works. There's no soil in which to plant an argument, because there's no understanding of what a billion dollars represents. There’s no genuine desire to understand the counterparty either. Very disturbing.
    • wat10000 4mo ago
      Perhaps, but I see zero desire from pg to understand the counterparty either. When engaging at such a superficial level, don’t be surprised when that’s what comes back.
    • OtherShrezzing 4mo ago
      A debates purpose is surely to reveal if there’s a measurable difference to be reconciled in the first instance. Any actual reconciliation is a nice bonus on top. So even if the debate reveals that no, there wasn’t a viable reconciliation, the debate was still worthwhile.
    • tensility 4mo ago
      Well, with the extreme levels of income stratification that we have in the US and greater world, money literally means a different thing to the few folks who've escaped the poverty trap ... just like hunting means a different thing for the hunters as it does for the prey.
    • intended 4mo ago
      I understand finance well enough to discuss money. I read the first half of PG’s essay and was left wondering if I should read the whole thing, just in case there was something in half 2 that redeemed half 1. Most startups fail! Ignoring that reality, and only focusing on the slope of money growth is like saying that if you hit the right drafts you will survive falling out of a high rise window. There is no such thing as a free lunch. The payoff for doing startups is the (incredibly small chance that you succeed) * (the absurd payout if you do). Even VC funds fail. If PG brought up survivorship bias at any point, it would have significantly armored his case.
• sharts 4mo ago
  Huh? Why do you require billionaires for your kids? There are so many alternatives
• c-hendricks 4mo ago
  Never thought I'd see "think of the children" as an excuse to requiring billionaires but HN will always find a way to surprise you.
• TitaRusell 4mo ago
  I would want my kids to be happy. Who gives a shit about what job they have.
  • pclowes 4mo ago
    People are generally happier when they are not starving to death and capitalism is really good at helping people not starve to death. Every global economic statistic backs this up
    • paulryanrogers 4mo ago
      Capitalism without regulation is a great way to grind large portions of the population to dust, and enrich a small number of capital owners. It consumes childhood and adulthood. Only when workers have power can the engines of innovation benefit the many. Of course history is littered with failed autocracies aspiring to be capitalist/socialist/insert-econ-system utopia. I'd argue the current US administration is in an autocratic mode right now. And doesn't seem to be going well for any except the richest asset owners.
      • deleted 4mo ago
        [deleted]
• knorker 4mo ago
  What do you expect the reaction to be when he's, at best, taking a political cheap shot by misrepresenting what someone said and spinning it into absurdity? It's an ugly ugly post, and that's what set the tone. I hope your kids grow up to become better people than those who would write what PG wrote, and not spread lies about their interlocutors with straw man BS. It's also an insulting post. Yeah we can add, thanks. That was never the problem. PG think math is what we were missing?
• jltsiren 4mo ago
  The essay kind of misses the point, as the question was mostly about the meaning of word "earned". "Earned income", for tax purposes, matches pretty closely the kinds of income many people consider genuinely earned in the moral sense. From this perspective, if a startup grows organically and the founders become rich, they have earned it. But if the growth requires capital (an investment, a loan, or the wealth the founders already have), the situation becomes less clear. How much of the success can be attributed to the contributions of the founders and how much is based on arbitrary choices made by wealthy people? If you now assume that existing wealth is mostly unearned, any success made possible by arbitrary allocations of that wealth is similarly unearned.
  • hammock 4mo ago
    Halfway through your second paragraph you started conflating income with wealth/capital. The wealth controlled by a startup investor becomes earned income, in your words, when the founder receives pay for their work, in the form of cash or exercised options or whatever else. To get that earned income, which is derived from wealth but is not the wealth, they have to earn it in the same way the wagies in your first paragraph earned it. The investor (on the board, presumably) has to vote him in as CEO and approve his pay package. And just as retail customers don’t give their money away for no good reason, neither do investors.
    • jltsiren 4mo ago
      You are focusing too much on legal definitions. The intuitive difference is mostly between the many and the few. Between the ordinary people and the elite. If your money comes from many small streams, it looks likely that many people have independently determined that what you are doing is valuable. If there are a few large streams, the situation is less clear. Maybe your contributions are genuinely valuable, or maybe someone is picking favorites or choosing winners in advance. From that perspective, capital is a poison that permanently puts the reasons of your success in question.
      • dotancohen 4mo ago
• sutterd 4mo ago
  I think there are different views you can have here. I think PG is in the group that thinks if you get a billion dollars, you earned a billion dollars. His distinction is between getting the billion dollars honestly or dishonestly. The alternate view is that you can get 100 billion dollars, presumably honestly, but that doesn't mean you earned a billion dollars. The first group will say this is splitting hairs. The second group will say that is the whole point. It the company gets a billion dollars, did it earn a billion dollars? Even more to the point, if the company earns a billion dollars, does the founder/CEO, or whoever is refernced in this post, earn a billion dollars? I think the two groups will just see this differently.
• ProjectArcturis 4mo ago
  I would have liked the essay more if PG had actually engaged with AOC's claims. He just does some math and shows that exponential growth is fast. What did the founder have to do to keep growing at 93%? Good solid business fundamentals and identifying a new solution can get you some growth. But eventually you've done all that and the only way to continue growing is extraction -- buy out your competition and raise margins, outsource your workers, enshittify your user experience. THAT is why no one "earns" a billion. The last $900M pretty much always requires using your resources in clever but unethical ways to extract money from customers and financial markets.
  • pdonis 4mo ago
    > I would have liked the essay more if PG had actually engaged with AOC's claims. I don't see why he should have engaged with them any more than he did, because AOC's claims are BS. He gave them more attention than they deserve. What he should have engaged with is, what happens when a startup stops being a startup? All three of his poster children for startups, Apple, Google, and Facebook, are now notorious for treating their users badly and making money in ways that at least a substantial number of people don't think are "earning" money, such as monetizing users' data. And at the last of those three, the founder is still in charge, so even if PG can argue that Zuckerberg earned what he got from Facebook in its startup phase, that doesn't mean he's earning the money he makes now from Facebook in the same way. (And the other poster child he mentions, AirBnB, can't be said to have clean hands either at this point.) To me that's the biggest gap in PG's worldview more generally, that I never see him address in his essays: once the startup phase is over, the company drops off his radar and he pays no attention to the collateral damage it causes when it's a tech giant. (And of course AOC's claims have nothing to do with this genuine issue either.)
    • paulhebert 4mo ago
      Did people become billionaires at those companies before or after they started being enshittified?
      • ProjectArcturis 4mo ago
• hammock 4mo ago
  Having been on HN for 15+ years I have found it fascinating to witness the fawning and adulation over pg blog posts completely reverse and everyone has turned on him now. It used to be if you criticized anything in his blogs you’d get downvoted to oblivion. Now criticism is the norm. As far as I can tell it’s less a change in pg’s viewpoints (though the topics have evolved, and he has gotten more transparent perhaps), but a change in the public reaction to them. I’m not sure if it’s the same people though, might just be the new generation.
  • Daishiman 4mo ago
    15 years ago things were quite different: * There were far fewer tech billionaries. * The tech billionaries were not publicly associating with far-right figures or cryptofascist belives, or at least were doing so quietly while promoting ideas of technology as social progress * A lot of the tech startups were seen as fighting entrenched interests grounded in regulatory capture and people had the illusion that the next generation of companies supplanting these wouldn't succumb to the same factors. * Donald Trump as a phenomenon of current politics did not quite exist yet, so we didn't have to witness these people sucking up to him That's just for starters.
  • tim333 4mo ago
    One thing I noticed is on HN where PG no longer hangs out the comments have gone negative whereas on twitter/x where he posts people are positive (https://x.com/paulg/status/2066124279448559907 https://x.com/paulg/status/2066124279448559907 on earn $1bn). I guess people who like him follow there.
    • smallmancontrov 4mo ago
      "Reply guy" culture is notorious for breeding sycophancy.
  • justincarter 4mo ago
    I still like to read pg but he keeps writing about things outside of his domain. Here for example I trust him to talk about growth rates and how startups work. But I don’t trust him to talk about wealth inequality and how political leaders respond to it.
• themafia 4mo ago
  Just because you managed to get a billion dollars of value attributed to your name does not mean that you know how to earn a billion dollars or that you have the first worthwhile clue to share to anyone else how they should do it. It's the blind trap of the successful. They lose situational awareness and can no longer accurately map their actions onto the world they actually live in. Which is probably why this immediately devolves into a bunch of silly math and equally silly proclamations that don't seem rooted in any actual defined course of action. This is less than worthless, it's actively harmful. > I've got kids And this requires _a billion_ dollars? Perhaps an intentionally narrowed scope would be good for some of the HN audience.
• kashunstva 4mo ago
  > I've got kids, I want people creating start ups they can work in, the alternative is too grim. I also have kids. I want them to live in a just society where billionaires, whom Mr. Graham proudly grooms, according to his telling of the matter, don’t actively undermine the ability of ordinary citizens to earn a living wage, to have a say in self-governance, and to enjoy universal healthcare.
  • elephant81 4mo ago
    I think you'll find its not billionaires stopping that, its elected officials.
    • cambrianentropy 4mo ago
      You are soooo close!
      • peab 4mo ago
        This sort of comment does not belong on hacker news.
    • neumann 4mo ago
      Yes their are. Majority of elected officials are just their instrument. The amount of money billionaires spend shaping media, lobbying and campaigns to get power and push propaganda to determine who is elected makes the fight to get people like AOC who are working in the interest of society so much harder.
      • nlitened 4mo ago
        > people like AOC who are working in the interest of society People like AOC just pander to uneducated populace who'd prefer to use force to take free stuff of other people who work instead of working themselves. Very easy to keep electing such politicians — just continue giving out more free stuff, so that people think it's the norm, and working is not required, just always taking is fine. People will vote accordingly
• jordwest 4mo ago
  > the alternative is too grim The problem is, reality doesn't care whether you think it's grim or not. I think the environmentalism movement faces this - it's easier to believe that everything is fine and we're not harming the planet and all is good, because the alternative is grim. But if the alternative is real then the fear of facing it is only going to make the reality even more grim.
• steele 4mo ago
  Ok
• _carbyau_ 4mo ago
  I can't speak for his other essays but this article was not great. He basically does some maths to show exponential growth. The definition of "earn" is not on the chopping block. Nor is what it means to "cheat" - which he introduces pretty early on. And times change. With the announcement: "[Insert name] is a billionaire!" It used to be: "Congrats to them for making the world better in some way and reaping the rewards." Now it is: "What did they leverage to force another subscription on us?"
  • dotancohen 4mo ago
    > It used to be: "Congrats to them for making the world better in some way and reaping the rewards." > Now it is: "What did they leverage to force another subscription on us?" Are you seriously asking how Elon Musk made the world better in some way? How about catalysing the move away from fossil fuels? How about inexpensive spaceflight?
    • ben_w 4mo ago
      > How about catalysing the move away from fossil fuels? How about inexpensive spaceflight? Much as I appreciate the former, the latter is if questionable benefit to most people, as the cost of launching e.g. GPS constellations and weather satelites was not the limiting factor for them, and direct-to-satelite phones and broadband at whatever the subscription price is, while neat, are not life changing for 99% of the population. (Space is cool, I like space, he's free to spend his own money how he likes, but the IPO happened because he ran out of his own and private investors' money). Also Tesla has problems going with that benefit, between court cases over marketing of FSD & if he committed fraud by saying he had secured funding to take it private, and also the P/E ratio is unjustifiable as a mere car company so they're pushing an AI narrative that's also unjustifiable for reasons long enough I can't be bothered to type them in again. That and him selling Tesla shares worth more than the lifetime revenue of the business, which is sus.
    • MrBuddyCasino 4mo ago
      History's first trillionaire is a guy who catches rockets out of the sky with chopsticks and beams internet to every dead zone on the planet. Same guy ships cars that drive themselves, humanoid robots for the factory floor, brain chips that let paralysed people move a cursor with pure thought, and an AI running on a supercomputer his team stood up in months instead of years. Your are debating people who sincerely believe that money is the economy and is not just a transaction mechanism lying on top of the actual goods and services that make up an economy. That the physical vectors of goods/services/logistics are just formalities relative to hard currency distribution, which, when implemented, would “solve world hunger” with $50 billion or whatever bunk number they claim is enough. Your are dealing with envious, deeply incurious people who, as history has demonstrated again and again, will kill millions in pursuit of their ideology. There is no convincing them, debating them, enlightening them. It is futile.
• dodu_ 4mo ago
  >No one seems to be contradicting anything he's saying here So the exact same thing PG is guilty of in the article? He disagrees with the opposing statement, gives a lazy counterexample with 0 evidence that introduces at least two major assumptions that do the the entirety of the work for his "argument", and then takes another few paragraphs to effectively say "just grow exponentially, bro". There's nothing to push back against except vague hand-wavey nonsense. PG is washed and the level of discourse in the thread matches the quality bar of his post, so I'd say it's pretty appropriate.
  • jojobas 4mo ago
    His core premise is that one's not required to cheat, use immoral loopholes or abuse anyone to become filthy rich, as a prominent US politician has claimed. That stands unchallenged.
    • Barrin92 4mo ago
      >His core premise is that one's not required to cheat His core premise is terrible if not outright facetious given the case he made. That the girl who is going to become a billionaire in his example has a startup that makes a product that everyone loves does nothing to disprove the point. Billions of people love VLC media player but Jean-Baptiste Kempf didn't become a billionaire. The difference isn't the product, it's that what makes the startup founder a billionaire is that they're willing to pawn off their invention to people who do all the unethical things, while they laugh on their way to the bank, that's the point of the big check. In some sense I prefer the robber Barron over the startup founder because at least the former doesn't pretend they're a saint between they've put one level of indirection between themselves and the exploitation.
      • jojobas 4mo ago
        The distinction is if Mr. Kempf tried to charge all these people 1 dollar a year he would have gotten maybe a few million, and probably wouldn't have gotten much of the annual ~100 people to contribute to his product so the product wouldn't have been so awesome in the first place. There's just no money in being somewhat better than your OS's built-in player. One can't be held responsible for unethical things done by his creation once it's sold.
• rayiner 4mo ago
  The prospect of AI replacing white collar jobs has supercharged HN’s socialist bent.
• temp8830 4mo ago
  Just because people disagree with you does not mean "narrow reading". OK, PG might have proved it's possible for someone to become a billionaire. But why is that a good thing? The model is: rich old guys extract money from the populace with threats of violence (just try not paying taxes). The rich old guys get FOMO. They give this money to young people who work really hard. This means foregoing sleep in favor of vibe coding some BS that nobody ever asked for, and making it addictive. Nobody in their right mind would give a penny to these very hard working young people. In fact they don't: their startups only make money through ads. Nothing they make is worth even a tiny subscription fee. And ads are paid for by resource strip-mining megacorps. What we have is a two-tier population of a have-nothing underclass and a handful of nobility. If we continue down this path there will be a revolution. There always is. Now that is something you probably don't want your kids to live through.
• croes 4mo ago
  The worlds is grim because billionaires have a large part of the cake and the rest has to fight over the crumbs. Billionaires are a sign of a failing systems because nobody earns a billion dollars. What do you think why many important jobs are badly paid while some CEO gets a billion dollars. Didn’t you see in the pandemic where the real important jobs are and did you realize how low their payment is? BTW it’s interesting you see you kids working in a startup but not creating one.
  • preommr 4mo ago
    > The worlds is grim because billionaires have a large part of the cake and the rest has to fight over the crumbs. et tu hn? I am tired of seeing this nonsense on social media (it's particularly bad on reddit, where /r/antiwork and it's offshoots keep hitting the front page) - Wealth is not a zero-sum game - Yes, billionaires shouldn't exist because they're a symptom of a broken system - And they don't exist on a long enough timescale, there's a reason why oil barons and railroad tycoon families are a shadow of their former selves, and why the richest people are all in tech/oil - Billionaires and increasing income inequality are a symptom of a bigger problem. Musk wouldn't have as much money if his publicly traded stock wasn't as popular... among the public. - Modern day securities are broken because they're poorly regulated because the public doesn't vote for people that would do the regulation.
    • olleromam91 4mo ago
      Most people are only able to vote for candidates that are chosen and campaigned by the monied interests. We can blame the people for not seeing how the system works sooner… but really that’s not who is acting out of line…
    • yuye 4mo ago
      >- Wealth is not a zero-sum game It literally is, though. For one's wealth to grow, the wealth of others must shrink. You could print more money, but that'd just result in inflation reducing everyone's wealth. If you intend to say value is not a zero-sum game, I agree.
• noufalibrahim 4mo ago
  There is a bubble here. Running ones own business is, on the overall, better than being employed especially given the current world. However, that doesn't automatically equal to startups. There are people who are running their own brick and mortar businesses. They're not billionaires or even millionaires but they've crossed the point where lack of a reliable source of wealth is a source of misery for them. Surely, that's a great thing.
  • nolroz 4mo ago
    Healthcare is one place that gives me pause when considering going back into business for myself and my family while living in the US.
    • noufalibrahim 4mo ago
      I guess it depends greatly on where one lives etc. This is a concern I've heard from all my friends in the States.
    • robotnikman 4mo ago
      This is definitely a concern that needs to be addressed if we want to see more small businesses again. It's a big risk not having health insurance.
• knuppar 4mo ago
  > I've got kids, I want people creating start ups they can work in, the alternative is too grim. got some bad news for ya pal
• tsimionescu 4mo ago
  Why do you think no one is contradicting him? The exponential growth model that pg presents is an obvious lie - you could use his exact explanation to claim that good founders will soon become trillionaires, all it takes is 9 months of 93% growth after your first few billions; quadrillionaires will soon follow. The obvious reality is that exponential growth is just a small phase in any company's history, and it is anyway limited by the size of the market(s) it is operating in. A company can quickly capture a market, but not quickly grow forever. Then, he completely hand waves away the externalities, lawlessness, self dealing and similar issues that are the supporting power of all such growth events. He claims this is all powered by "making your users happy", which makes them tell others about your business, as if every restaurant that people fawn over becomes a billion dollar business in 1-5 years. Even the examples he can think of of companies that did this are infamously bad companies that have become rightly hated and accused of spreading various forms of social ills - e.g. social media addiction induced by Meta, spy ads by Google, excessive tourism and house price increases by Airbnb, or the erosion of worker protections by Uber. There isn't a single billion dollar company that doesn't at least get accused of similar problems, which represent t the meat of the argument, and pg ignores this completely in favor of the "build something useful" model.
  • saidnooneever 4mo ago
    it is simple fact economy is based on maths that require a percentage growth or death from everyone. denying that is denying maths. There will not be next quadrillionaire soon because there are economic crashes that kick economy down each time so it has space to climb again. That is how its been historically and how it will continue unless the math underpinning it will change.
  • chistev 4mo ago
    I agree with you, but what would be the argument against Athletes and someone like J.K. Rowling (Harry Potter author)?
    • deleted 4mo ago
      [deleted]
    • 4mo ago
• anon291 4mo ago
  Both political parties and all 'sides' in America fundamentally agree on degrowth. The only distinction is the Idiocracy version or the ivory tower one
• deleted 4mo ago
  [deleted]
• DrScientist 4mo ago
  I think the problem here is the word 'earn' is doing a lot of heavily lifting. Let's take Y combinator. He is in the money lending business - where he sells the idea of becoming a billionaire ( which is possible in software as it so easily scales relative to other types of businesses ) to young people so they work crazily hard. Most of them fail ( which he doesn't focus on ), but just like a bookie who profits from gambling - he always wins as he controls the rules ( odds/investment percentages - ie lending rates ) of the game. So he has set up a system that extracts value from others. Nothing wrong with startups - not only to the founders get to keep more of their value, they can also set company culture and values etc. However you could argue, particular in software where capital isn't really needed, that taking money from a VC is very expensive - and also somewhat abrogates that founder control. Sometimes you need investment, and good VC's can really add value ( both to the investor and investee ) - but his ideal investment is going to be to companies that don't really need it - where he can reap a huge reward for little effort.
  • runeks 4mo ago
    > So he has set up a system that extracts value from others. That's a very negative way to describe buying a share in a company.
    • DrScientist 4mo ago
      I'm pointing out the reality. As I said, I'm not a person that thinks that correct allocation of capital isn't a useful role. Really good VCs and investors are really really important. However like art - it can be both simultaneously true that art has intrinsic value and that the art market is seriously corrupt. Sure Paul adds value - but I'd humbly suggest not as much as he has extracted.
• root-parent 4mo ago
  Out of 6,500 companies YC funded companies, less than 0.40% amounted to anything. Do you really want to apply to YC with these success rate? The issue is that these 30 billionaires PG decided to highlight, none of their 14 companies, from which less than half are even profitable right now...are relevant at all. No civilization level breakthroughs, they are mostly payment layers, delivery apps, marketplaces, crypto exchanges, and labor or regulatory arbitrage, and attention platforms. If Airbnb, DoorDash, Instacart, Coinbase, Reddit, Brex, Deel, or Flexport disappeared tomorrow, humanity would not lose a vaccine, a new energy source, a scientific discovery, or a cure for disease. We would mostly switch apps. Only depressing aspect is pretending jackpot level, private wealth, equals meaningful progress. There is a reason not once, he used the word entrepreneur in the essay...
• mrhottakes 4mo ago
  Well, you can't always get what you want.