14 ms·

It is great that you are able to do this, but not that your situation is not the one described in the article. The article discusses men who only qualify for lo

by marcell 12y ago

It is great that you are able to do this, but not that your situation is not the one described in the article. The article discusses men who only qualify for low/no skill jobs paying $10-15/hr. That is markedly different from a tech startup cofounder who could get a software engineering job paying $100k+ with benefits.

rtpg 12y ago
yeah, a big problem with the whole "Don't need BigCo's job cuz I'm running a SV startup!" narrative is that it's really only accessible for people who already belonged to pretty privileged classes (exceptions exist, obviously.) A portion of the population does not get opportunities to develop these skills and were once allowed low-skilled jobs that paid "decently" but have now found themselves squeezed due to inflation and companies hoarding cash instead of spending it.
- shutupalready 12y ago
  > companies hoarding cash instead of spending it I've heard this sentiment many times but I've wondered if there's an economic fallacy there. Would the economy be better off if lots of companies stopped hoarding cash and hired lots of new employees? Or would there be side-effects like inflation, or some effect of pulling out cash from whatever it was invested in, etc.? Serious question.
  - barry-cotter 12y ago
    > I've heard this sentiment many times but I've wondered if there's an economic fallacy there. There is, it's a confusion between money and capacity. That money is an option, the possibility of getting people to do things for you. Unused money is paper. > Would the economy be better off if lots of companies stopped hoarding cash and hired lots of new employees? The economy is an abstraction. It can't be better off. But if the companies that have the money had productive ways to spend it they would be doing so. The fact that there aren't that many productive ways to use the money is why the interest rate is so low. The interest rate is the cost of renting money.
    - venomsnake 12y ago
      But we cannot produce more, because the unemployed don't consume. So we lay of people. It is a death spiral.
      - _glass 12y ago
        This is also wrong. You just have to switch what to produce and to whom. There are many starving people in the world, and quite a lot new medicals to invent and so on.
        emodendroket 12y ago
        Yes, wonderful. The wretched of the earth are a huge untapped market with tons of disposable income.
      - pbhjpbhj 12y ago
        If your future economic prospects require ever increasing consumption then surely there's a problem; resources are finite. If we need more people consuming more and more stuff (that mostly gets put in landfill within a couple of years) then we're completely screwed. We need to start restructuring our way of life to accommodate the need to conserve resources, for one, and the need to support a basic standard of living for all people (across the world) for another. Instead of encouraging increased consumption we need to be levying massive taxes against disposable items, requiring all goods to be largely recyclable, requiring the ability to repair before production can be licensed.
        emodendroket 12y ago
        > If your future economic prospects require ever increasing consumption then surely there's a problem; resources are finite. Yeah, that's the inherent contradiction of capitalism. But unless someone comes along with a different system we're probably stuck with that for a while.
        akgerber 12y ago
        Depends on what that 'consumption' consists of. We could have an economy of eternal growth in art, scholarship, mathematics, music, and software. The main input there is human thought.
  - jahnu 12y ago
    Very little down side. People with more income spend more which grows the economy. In a two person economy, your expenditure is my income and my expenditure is your income. If one of us hoards then both of us lose eventually. Also moderate inflation is a good thing. It disincentivises hoarding of cash.
    - icebraining 12y ago
      Also moderate inflation is a good thing. It disincentivises hoarding of cash. Another way to look at that is that it incentivises short-term investment in anything that brings returns above inflation, instead of allowing for capital to be saved up for more important projects.
    - drcomputer 12y ago
      Do you think the same rules apply to an information economy?
      - emodendroket 12y ago
        Why would they not?
        drcomputer 12y ago
        I don't know. There always seem to be many alternate compositions of rules that can be used to define the environment while enforcing or altering the rule composition rules. Rules can define themselves, rules used to regulate the flow of information become information.
    - innguest 12y ago
      That spending stimulates the economy is a fallacy. Standard economics defends that idea; but it is only true in a fairy-tale world where you have a magic money printing machine - like the world we are currently living in. In the real world you actually have to have savings first and foremost in order to produce the products that others will buy. Hoarding is a good thing since it frees the person to work on what they like, which is likely to benefit others. Also, money hoarded is usually invested in some instrument that might be benefiting other businesses. > In a two person economy, your expenditure is my income and my expenditure is your income. This is wrong. Imagine two people in an island. We elect that fish is money since it's the thing we all want and have a use for and can easily trade with each other. Now I fish 5 fish and put that in my savings account (a bucket of salt). As I spend this money, it does not become your income. You might be confusing the way governments characterize the economy with how a real world economy actually works in practice. > Also moderate inflation is a good thing. It disincentivises hoarding of cash. And moderate tax-evasion is a good think because it disincentivizes hoarding of cash by the government. This is wrong as well. Not to say morally wrong, as it's trying to steer people's financial decisions in a definite uniform direction (ie. spending). That sort of thinking is what had the US government almost shut down yesterday and have to inflate the money supply with $1.1 trillion more. It used to take us decades as a country to spend that much, but now it's only expected to last until September 2015. But we still have people saying moderate inflation is a good thing.
  - asgard1024 12y ago
    First of all, you have to understand that "state where everybody is better off" is not something that's given. Everybody can be rational and still be worse off - prisoner's dilemma is a canonical example. Economic fallacy there is, but it's in standard economic theory. Standard economics claims that only sensible things to do are investment and consumption, and considers savings to be a waste. But the savings are not waste for individual economic entities; savings are a way of gaining power in economics. Let me give a couple examples, consider two companies, company A which saves (has large quantities of liquid capital), the other B which doesn't (and invests everything into machinery, better production, etc.). First example: A stealthy startup appears with a completely new ("disruptive") technology. Company B cannot buy it, so the company A is at advantage. Second example: Workers decide to strike for higher wages. Company A can survive the long strike by taking hit on it's monetary reserves, perhaps pay strikebreakers, etc. Company B cannot do anything and have to give in to the strikers demands. In other words, savings are a way to break out of the market system, and so people do it and race who does it better, because they want power (which comes from ability to react). Economy as a whole suffers; but why should the winning actor care?
    - _glass 12y ago
      This is the typical principle agent problem, it depends of the ownership of the company. If it is privately hold, then savings make sense and you have to optimize for sustainability, i.e. otherwise your private savings are nilified. But if the company is widely spread by shareholders, then you have the maximize value by concentrating on one product, and leverage by keeping down the risk factor while still maintaining a high enough earnings on capital rate. The risk is adverted by the shareholders themselves that have their own portfolio of companies.
    - MCRed 12y ago
      I think to say the economy as a whole suffers is too broad, and falls into the trap of people who really are advocating a consumption oriented society. For instance, you could spend your money constantly hiring more employees to do more work and to grow. Or you could save your money, until you have enough to build a new modern factory that produces the product much more efficiently. That efficiency lets you pay your fewer employees more, but overall lets the business grow more reliably. In your example, Company A is better for the economy because it will last a lot longer than Company B. Companies failing does more economic damage than a company saving its profits for several years.
  - emodendroket 12y ago
    The whole foundation of capitalism is growth so if we're embracing zero-growth we have to radically change things. (in short, yes, companies hiring and spending is an unalloyed good on the macroeconomic level)
- jsilva 12y ago
  What do you mean by "privileged classes", not sure i understood your idea ?
  - dwaltrip 12y ago
    The people who have had more good things happen to them (money, smarts, education, favorable societal position, supportive family) than most other people. It is easier for these people to not get a regular job and try to build something on their own.
  - hessenwolf 12y ago
    Personal availability of risk capital. I mean, if I make a mistake with my cashflow stream, I don't eat. It has happened three times in my life, and not in twelve years. This means that I make decisions differently to somebody who has a buffer of parental emergency capital injection. For example, I would love passionately to quit my job right now. I would love to set up a consultancy specialising in data analysis for capital management for insurance companies, and have more than the required skill set, but if I take too much risk my family could be hungry. That would be decidedly uncool.
  - Axsuul 12y ago
    He means those that belong to "privileged classes" usually don't have liabilities such as student loans to pay off and therefore have the freedom to pursue endeavors such as startups which don't pay the bills upfront. Furthermore, their support network is also a significant factor.
    - xrange 12y ago
      And of course the vast majority of the world would consider someone with student loan debt to belong to a "priviledged class".
  - yen223 12y ago
    For one thing, you need savings. If you absolutely need a paycheck this month to make it through to next month, you simply cannot afford the risks involved in doing the whole startup thing. Another thing, you need skills. But it's very difficult to get a decent education (formal or otherwise) if your family isn't able to support you during your formative learning years. It's not easy to learn programming if your family can't afford a computer. It's not easy learning financial management when the largest amount of money you ever had is $500. Basically, if you want to do a startup, you had better not be poor or uneducated.
- edpichler 12y ago
  "A portion of the population does not get opportunities to develop these skills and were once allowed low-skilled jobs that paid decently..." Exactly!
- mrec 12y ago
  "A portion of the population does not get opportunities to develop these skills and were once allowed low-skilled jobs that paid "decently" but have now found themselves squeezed" Slate Star Codex had a great post a while back that touched on this: http://slatestarcodex.com/2014/08/16/burdens/ http://slatestarcodex.com/2014/08/16/burdens/ Key pull quote: "Society got where it is by systematically destroying everything that could have supported him and replacing it with things that required skills he didn’t have."

by marcell 12y ago

rtpg 12y ago

yeah, a big problem with the whole "Don't need BigCo's job cuz I'm running a SV startup!" narrative is that it's really only accessible for people who already belonged to pretty privileged classes (exceptions exist, obviously.) A portion of the population does not get opportunities to develop these skills and were once allowed low-skilled jobs that paid "decently" but have now found themselves squeezed due to inflation and companies hoarding cash instead of spending it.

shutupalready 12y ago
> companies hoarding cash instead of spending it I've heard this sentiment many times but I've wondered if there's an economic fallacy there. Would the economy be better off if lots of companies stopped hoarding cash and hired lots of new employees? Or would there be side-effects like inflation, or some effect of pulling out cash from whatever it was invested in, etc.? Serious question.
- barry-cotter 12y ago
  > I've heard this sentiment many times but I've wondered if there's an economic fallacy there. There is, it's a confusion between money and capacity. That money is an option, the possibility of getting people to do things for you. Unused money is paper. > Would the economy be better off if lots of companies stopped hoarding cash and hired lots of new employees? The economy is an abstraction. It can't be better off. But if the companies that have the money had productive ways to spend it they would be doing so. The fact that there aren't that many productive ways to use the money is why the interest rate is so low. The interest rate is the cost of renting money.
  - venomsnake 12y ago
    But we cannot produce more, because the unemployed don't consume. So we lay of people. It is a death spiral.
    - _glass 12y ago
      This is also wrong. You just have to switch what to produce and to whom. There are many starving people in the world, and quite a lot new medicals to invent and so on.
      - emodendroket 12y ago
        Yes, wonderful. The wretched of the earth are a huge untapped market with tons of disposable income.
    - pbhjpbhj 12y ago
      If your future economic prospects require ever increasing consumption then surely there's a problem; resources are finite. If we need more people consuming more and more stuff (that mostly gets put in landfill within a couple of years) then we're completely screwed. We need to start restructuring our way of life to accommodate the need to conserve resources, for one, and the need to support a basic standard of living for all people (across the world) for another. Instead of encouraging increased consumption we need to be levying massive taxes against disposable items, requiring all goods to be largely recyclable, requiring the ability to repair before production can be licensed.
      - emodendroket 12y ago
        > If your future economic prospects require ever increasing consumption then surely there's a problem; resources are finite. Yeah, that's the inherent contradiction of capitalism. But unless someone comes along with a different system we're probably stuck with that for a while.
      - akgerber 12y ago
        Depends on what that 'consumption' consists of. We could have an economy of eternal growth in art, scholarship, mathematics, music, and software. The main input there is human thought.
- jahnu 12y ago
  Very little down side. People with more income spend more which grows the economy. In a two person economy, your expenditure is my income and my expenditure is your income. If one of us hoards then both of us lose eventually. Also moderate inflation is a good thing. It disincentivises hoarding of cash.
  - icebraining 12y ago
    Also moderate inflation is a good thing. It disincentivises hoarding of cash. Another way to look at that is that it incentivises short-term investment in anything that brings returns above inflation, instead of allowing for capital to be saved up for more important projects.
  - drcomputer 12y ago
    Do you think the same rules apply to an information economy?
    - emodendroket 12y ago
      Why would they not?
      - drcomputer 12y ago
        I don't know. There always seem to be many alternate compositions of rules that can be used to define the environment while enforcing or altering the rule composition rules. Rules can define themselves, rules used to regulate the flow of information become information.
  - innguest 12y ago
    That spending stimulates the economy is a fallacy. Standard economics defends that idea; but it is only true in a fairy-tale world where you have a magic money printing machine - like the world we are currently living in. In the real world you actually have to have savings first and foremost in order to produce the products that others will buy. Hoarding is a good thing since it frees the person to work on what they like, which is likely to benefit others. Also, money hoarded is usually invested in some instrument that might be benefiting other businesses. > In a two person economy, your expenditure is my income and my expenditure is your income. This is wrong. Imagine two people in an island. We elect that fish is money since it's the thing we all want and have a use for and can easily trade with each other. Now I fish 5 fish and put that in my savings account (a bucket of salt). As I spend this money, it does not become your income. You might be confusing the way governments characterize the economy with how a real world economy actually works in practice. > Also moderate inflation is a good thing. It disincentivises hoarding of cash. And moderate tax-evasion is a good think because it disincentivizes hoarding of cash by the government. This is wrong as well. Not to say morally wrong, as it's trying to steer people's financial decisions in a definite uniform direction (ie. spending). That sort of thinking is what had the US government almost shut down yesterday and have to inflate the money supply with $1.1 trillion more. It used to take us decades as a country to spend that much, but now it's only expected to last until September 2015. But we still have people saying moderate inflation is a good thing.
- asgard1024 12y ago
  First of all, you have to understand that "state where everybody is better off" is not something that's given. Everybody can be rational and still be worse off - prisoner's dilemma is a canonical example. Economic fallacy there is, but it's in standard economic theory. Standard economics claims that only sensible things to do are investment and consumption, and considers savings to be a waste. But the savings are not waste for individual economic entities; savings are a way of gaining power in economics. Let me give a couple examples, consider two companies, company A which saves (has large quantities of liquid capital), the other B which doesn't (and invests everything into machinery, better production, etc.). First example: A stealthy startup appears with a completely new ("disruptive") technology. Company B cannot buy it, so the company A is at advantage. Second example: Workers decide to strike for higher wages. Company A can survive the long strike by taking hit on it's monetary reserves, perhaps pay strikebreakers, etc. Company B cannot do anything and have to give in to the strikers demands. In other words, savings are a way to break out of the market system, and so people do it and race who does it better, because they want power (which comes from ability to react). Economy as a whole suffers; but why should the winning actor care?
  - _glass 12y ago
    This is the typical principle agent problem, it depends of the ownership of the company. If it is privately hold, then savings make sense and you have to optimize for sustainability, i.e. otherwise your private savings are nilified. But if the company is widely spread by shareholders, then you have the maximize value by concentrating on one product, and leverage by keeping down the risk factor while still maintaining a high enough earnings on capital rate. The risk is adverted by the shareholders themselves that have their own portfolio of companies.
  - MCRed 12y ago
    I think to say the economy as a whole suffers is too broad, and falls into the trap of people who really are advocating a consumption oriented society. For instance, you could spend your money constantly hiring more employees to do more work and to grow. Or you could save your money, until you have enough to build a new modern factory that produces the product much more efficiently. That efficiency lets you pay your fewer employees more, but overall lets the business grow more reliably. In your example, Company A is better for the economy because it will last a lot longer than Company B. Companies failing does more economic damage than a company saving its profits for several years.
- emodendroket 12y ago
  The whole foundation of capitalism is growth so if we're embracing zero-growth we have to radically change things. (in short, yes, companies hiring and spending is an unalloyed good on the macroeconomic level)
jsilva 12y ago
What do you mean by "privileged classes", not sure i understood your idea ?
- dwaltrip 12y ago
  The people who have had more good things happen to them (money, smarts, education, favorable societal position, supportive family) than most other people. It is easier for these people to not get a regular job and try to build something on their own.
- hessenwolf 12y ago
  Personal availability of risk capital. I mean, if I make a mistake with my cashflow stream, I don't eat. It has happened three times in my life, and not in twelve years. This means that I make decisions differently to somebody who has a buffer of parental emergency capital injection. For example, I would love passionately to quit my job right now. I would love to set up a consultancy specialising in data analysis for capital management for insurance companies, and have more than the required skill set, but if I take too much risk my family could be hungry. That would be decidedly uncool.
- Axsuul 12y ago
  He means those that belong to "privileged classes" usually don't have liabilities such as student loans to pay off and therefore have the freedom to pursue endeavors such as startups which don't pay the bills upfront. Furthermore, their support network is also a significant factor.
  - xrange 12y ago
    And of course the vast majority of the world would consider someone with student loan debt to belong to a "priviledged class".
- yen223 12y ago
  For one thing, you need savings. If you absolutely need a paycheck this month to make it through to next month, you simply cannot afford the risks involved in doing the whole startup thing. Another thing, you need skills. But it's very difficult to get a decent education (formal or otherwise) if your family isn't able to support you during your formative learning years. It's not easy to learn programming if your family can't afford a computer. It's not easy learning financial management when the largest amount of money you ever had is $500. Basically, if you want to do a startup, you had better not be poor or uneducated.
edpichler 12y ago
"A portion of the population does not get opportunities to develop these skills and were once allowed low-skilled jobs that paid decently..." Exactly!
mrec 12y ago
"A portion of the population does not get opportunities to develop these skills and were once allowed low-skilled jobs that paid "decently" but have now found themselves squeezed" Slate Star Codex had a great post a while back that touched on this: http://slatestarcodex.com/2014/08/16/burdens/ http://slatestarcodex.com/2014/08/16/burdens/ Key pull quote: "Society got where it is by systematically destroying everything that could have supported him and replacing it with things that required skills he didn’t have."