6 ms·

You raised a good point in bringing up that phrase "fair share." What is the fair share for someone who doesn't do anything? What should someone get for mere

• pc86 11y ago
  > for someone who doesn't do anything Presumably that person who "doesn't do anything" now spent many years working 12+ hours a day, 7 days a week, for zero pay building the business. It would not exist in any form without them.
  • Frondo 11y ago
    So, someone spends 12+ hours a day, 7 days a week, for zero pay, for some period of time (say, a year), and for the rest of their life, they receive free money. Tweak the numbers but that's what you're saying in a nutshell... and that's certainly the way the world works now. Should it? Do we like the idea of "receive free money" because there is entrepreneurship involved? What if it someone who was born into owning a business? Do we still like the idea as much?
    • Turing_Machine 11y ago
      Others work the same amount and lose everything. Most startups fail. What you're calling "free money" is compensation for the risk. Without it, most people would not start businesses.
      • Frondo 11y ago
        I don't see how failure or success changes that question of "is a lifetime of free money for some small value of work acceptable?" -- nor am I even saying "no free money ever". I'm getting at, where does the passive ownership cross the line into rent-seeking?
        • Turing_Machine 11y ago
          "I don't see how failure or success changes that question of "is a lifetime of free money for some small value of work acceptable?"" Because it's not "free money". At all. Edit: "free" implies that you don't have to do anything for it. That's not the case. Do you also consider retirement pensions "free money"?
        • mindcrime 11y ago
          Who said it was some "small value of work"??? Starting a company is FUCKING HARD, and the founders put in simply incredible amounts of effort in the early days. I mean, sure, it's different for different companies, but I know I've routinely worked 100+ hours a week for years with no vacation, sacrificed time with friends and family, sacrificed going out, partying, socializing and doing a lot of other things I enjoy, and even (stupidly) sacrificed my health to the point of having a heart-attack and almost dying. So yeah, if my company is ever successful enough to make a continuous profit, you're damn right I feel like I've earned my share of that future profit, even if I do decide to go lie on a beach somewhere and relax. The way I'm looking at it, I'll just be making up for all the times I didn't do that earlier on. I'm getting at, where does the passive ownership cross the line into rent-seeking? Who cares? Let's quit using "rent seeking" as some kind of pejorative. It's not, and it's nothing to make some big deal over.
          • Frondo 11y ago
            You know, let's be honest--starting your first business is hard, because you have to learn about marketing, customer outreach, listening to people and connecting them with things they want, etc. But 100 hours a week, for years? There's something bigger going wrong there--either you're trying to sell something people don't want, you've hired a lot of the wrong people, or whatever, I don't know. That's not typical, and it's certainly not praiseworthy. As for that "indefinite free money for past work," again, you're free to say you want that, and right now it's certainly yours to try and put into a contract. I don't agree that it's moral or right or deserved, no matter how many 100 hour weeks you work.
      • s73v3r 11y ago
        Why do I care that they "took a risk", though? All I see is that I'm busting my ass, they're laying on a beach, and they're getting more than me.
        • Turing_Machine 11y ago
          You're perfectly free to start your own business and find out just how much ass-busting is involved in doing that.
          • s73v3r 11y ago
            Like I said, what happened in the past doesn't matter. All the employees see is someone taking the bulk of the reward, for not doing much at all. Odds are, we had to replace all of their shit code, or they weren't able to write any of it to start with.
          • Retra 11y ago
            One of the big problems here is that the skills involved in making money in a successful business are not skills that everyone can or should possess. For instance, I spent many years of my life studying physics, and that is probably never going to make me very much money. There's risk. There's ass-busting. But little chance for reward, because the skills are not directly related to networking and wealth-management.
    • cousin_it 11y ago
      Then vote to raise taxes on revenues and inheritance. We need enough taxation to give everyone a reasonable standard of living, but not so much as to discourage private enterprise. I think it's achievable, given the recent growth in productivity.
      • Frondo 11y ago
        Agreed, a hundred percent. I'm doing my own startup right now, even (not profitable, but revenue-positive!), so it's not like I have no dog in this big-picture race. Private enterprise is important. I also see how things are awful skewed in favor of the established money/power. And as for voting on taxes on revenue/inheritance, I do, heh! A few years ago, here in Oregon, they tried to eliminate the estate tax (again), and I happily voted to keep it.
        • mooreds 11y ago
          Actually, the past 70 years, of productivity gains accruing to labor and being fairly widely shared in society, is pretty atypical (over the past couple of hundred years). In most western societies (and other where records are available) those owning production (typically land, but sometimes factories) captured most of the wealth. Source: Capital in the 21st Century by Piketty.
    • sfafdsdf 11y ago
      The other side of it is that the entire enterprise would theoretically not exist without that initial effort. While it may not appear fair under certain ethical frameworks for someone to receive free money, it seems to be that the choice is "everyone gets nothing" versus "someone gets more than others because they created it". in my experience, this is a red herring. I know very few founders who don't work harder after an acquisition or capital investment than before. Those who are sitting on the beach tend to have sold their interest.
      • Frondo 11y ago
        Again, how long after that enterprise has existed should a person get to claim free money? I think that phrasing, "may not appear fair," is kind of a weaselly way to say "rent-seeking is ok and let's keep it" (which is, I get it, a common sentiment among people who think they might be the rentiers some day). I don't think it is good for society, certainly not the one I'd like to live in, though it sure is good for the person getting that free money. (And yes, I know this is largely in the realm of hypotheticals, because it seldom happens that the owner is totally absent...)
        • jamestnz 11y ago
          I get the moral argument you're making, but there's a practical side to it, too. In any capitalist system, the fruits (profits) of an income-generating asset (such as a business) accrue to the owners. Assuming that the idea of private property ownership exists, I can't think of any other coherent place for the profits to go, other than the owner. Sometimes, a business might be an unexpected hit, taking off and generating revenues beyond the wildest dreams of the founder. Suddenly the company is flush with cash. Now assuming all the employees are fairly compensated, and all the company's other financial needs are met, then beyond a small buffer, what is there to do with the excess cash aside from paying it out as a dividend to the owner? So I guess my point is that we can make moral hypotheticals all day (about whether it's "right" for the owners of a profitable company to get "free" money "forever" without necessarily "doing anything" further), but I'm not sure what other system we could put in place within a capitalist framework. If a company is treating its employees well, meeting all needs, and still generating an operating surplus, where else would you have that money go, if not to the owners? Also I think your use of the term "rent-seeking" here is incorrect. A business owner receiving "passive" (or at least "not much active involvement") income from the business they own is kinda the antithesis of rent-seeking. Rent-seeking behaviour is the attempt to increase your share of the wealth, by means other than generating additional wealth. When you're the one who owns a profitable company, you're the one generating that wealth. The classic example of rent-seeking is someone installing a chain across a river that happens to run through their land, and then starting to charge people to pass through "their" bit of river. They add no value to the economy in doing this, no product is created nor any service rendered; they are simply extracting rents from river-users. Another example might be when a company seeks to tilt laws/regulations in its favour (e.g. through lobbying), with the intention of increasing the share of the wealth without the business actually having to generate it. Just like the river, no additional wealth is generated as a result of this action: existing wealth is merely being redistributed (toward the rent-seeker) by government policy. The key concept in rent-seeking being that wealth (the so-called "rent") is being captured by a party (the rent-seeker) without them generating it.
    • brc 11y ago
      >Should it? Yes. Removing the ability to create passive income streams removes the incentive to invest time and money. Entrepreneurship can be switched off like a light if the incentives are removed. When Entrepreneurship is extinguished, quality of life for everyone decreases. People start businesses knowing the odds are long but the rewards are great if they pull it off. There are those that complain about 'trust fund kids' who are born into wealth. They're a very tiny percentage of population, the wealth doesn't usually last many generations, and 'passing it on' is also a major motivator for many people. For each douchebag with rich parents there are others who use their financial freedom to work on hard problems. Charles Darwin was the grandson of Josiah Wedgwood. Wedgwood was one of the first industrial entrepreneurs and developed many business techniques still in use today. Darwin was an original 'trust fund kid' who used his financial freedom to pursue science and write his books, which changed the world for the better. There will be countless modern repetitions of this pattern, and you'd discard this type of benefit of inherited wealth at peril.
  • cgag 11y ago
    I'm not sure that should create an infinite debt for (potentially) thousands of people.
  • vacri 11y ago
    Gilding the lily a bit there, aren't we? I've worked in half a dozen start-ups, and a few owner-started small businesses before that, and none of them had a founder that lived on zero pay for years (excluding the founder who came from an 'old money' family), and none of them worked 7/12+. Long hours, sure. Work on weekends, sure. Work 12+ hours every day as a normal way of life? Pull the other one. Just because you can find the occasional person that does this, doesn't mean that they're a typical example.
• LoSboccacc 11y ago
  One usually invest quite some saving in these endeavours. Say 10 years. You have three years of runway before getting resounding success or having to pack. At the end of these three years you have to compare your gains against what you'd have gained saving some more. If you start your thing, the initial years will be in the red. If it works out in the end, you are looking to gain your saving back, plus the years of missed gains, plus the interest you'd matured having money When you start grtting enough money to hire someone to maintain the company and start gaining passively you aren't actually passively gaining from the beginning: you are still a lot in the red. So it's moral to me wanting to keep a share of the company earnings, so I'd be able to sustain another venue. Also it doesn't seem so bad to profit from an idea one had to enter a new market, niche or otherwise. Others are free to build their alternative after all but they didn't, so all the value from the idea is yours until challenged.