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Comment by confounded | Hacker News Reader

Using the word “tech” to describe the business practices of unregulated monopolies is really starting to grind on me.

It’s not necessarily journalists’ fault; that’s the term these companies have used to market themselves for years.

We (the engineering classes / actual technologists) need to do more to brighten the line between the technology and the motivations and incentives of the people putting up the capital (and the executives/lawyers/lobbyists they control).

And, possibly, to recognize our latent power to influence certain decisions.

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> the people putting up the capital

If you look at the balance sheets of many very profitable software/service companies, particularly those that use the cloud but do not provide the cloud, you will see that the concept of 'capital' is not what most think it is. There are almost no physical assets there to justify calling the system 'capitalist.' The rate of return (free cash flow) on assets is astronomical. For example, I have recently worked for a firm in which the assets and annual return to shareholders were each equal to about 2 months of revenue. And most of the assets are either cash equivalents that the 'capitalists' have simply squirreled away out of past earnings, or agreed-upon fictions like deferred costs or goodwill, or monopoly rights (intellectual property) created by the government for the corporations.

This is not to say that successful entrepreneurs do not have extraordinary talents at what Barnum called "money-getting." But it is hard to call someone who starts a firm for $1,000.00 in his garage and sells it for 10 figures, or someone controlling a similar firm who has already recovered his initial investment 100,000 times over, or a hired-gun employee slash-and-burn CEO who is given a few million in shares to motivate more money-getting, a 'capitalist.' Especially since the $1,000.00 probably went for things like telephone and answering services, stationary, advertising, legal fees of getting set-up, or finding a first customer, which are expenses, not capital, and none of which are recorded in the firms capital accounts. Our respect for capitalism is so overblown that we take it as given that any making of unimaginable amounts of money by means that no one understands is an example of 'capitalism,' because if it were not, the reverence for capitalism would be called into question.

Thanks for writing this. It's tangential to my point (which is specifically about the large corporates which constitute "tech" in the colloquial sense), but I find it very interesting, and am keen to reduce my own ignorance.

> There are almost no physical assets there to justify calling the system 'capitalist.'

Why do there need to be physical assets? I know the classic Marx-ish "seize the means of production" stuff is written in this way, but it doesn't make much sense to me outside of the factory labor of the industrial revolution.

I use 'capital' to mean investable money, or assets that can be traded or exploited; e.g. accumulated wealth, as opposed to income. And I generally use 'capitalist' to mean someone who invests 'capital' seeking a return on investment, without producing much productive labor themselves. Often this means maintaining the capability to partially or fully control the product and the nature of production, in exchange for the investment. E.g. a venture capitalist.

> But it is hard to call someone who starts a firm for $1,000.00 in his garage and sells it for 10 figures, or someone controlling a similar firm who has already recovered his initial investment 100,000 times over...

These wouldn't really be 'capitalists' per my working definition above, just extraordinarily successful founders of bootstrapped-small-business. I think we're aligned, except on whether examples like these are in any way representative of anything that's likely to happen to anyone, or what's meant by "tech" in the article. Google raised 36MM pre-IPO, Facebook 2.3B pre-IPO. This money came from venture capitalists, who would have exchanged it for boards-seats, strong influence on executive appointments, and ultimately the direction of the company.

I can't tell if you're an accountant or a Marxist (or a Marxist accountant!), but I'm keen to know more about your perspective.

No, I am a skeptic, not a Marxist. I try to keep this question of Einstein in mind: "What does a fish know about the water in which he swims all his life?" We never know how much we are missing, what points of view will come and go back and forth between unrecognized and undeniable.

I've been following these fashions for some time (I can trace my skepticism to reading Parkinson's Law when it was fairly new and I was 11 years old). When I was taking my degree in economics, the theory of the firm said that the firm exists to cooperatively advance the combined interests of its suppliers of capital, its suppliers of labor, and its customers. Later, that was expanded to also recognize the reasonable expectations of other 'stakeholders.' The apotheosis of wealth has changed that so much that deciding how much we have gained or lost is much like the index-number problem in economics -- unresolvable. We cannot value what we have today by standards that we used to embrace, nor can we value what we used to have according to today's standards. We cannot not change, but changes over time confound the problem of evaluating change.

I might suggest that the single biggest cause of the runaway worship of vast wealth was the arrival of the New Hampshire lottery, the first modern lottery in the 50 states, subsequently imitated by almost all the others, in 1964. Now the man in the street can identify and sympathize with the millionaire because it is only a matter of time until the right numbers come out (lottery investments in the USA are now around $1.00 per capita per day). Belief in American capitalism runs on optimism; optimism and denial sustain each other.

This too shall pass.

I'd wager you have zero power in your organisation to I fluence corporate structure and tax policy. If you do, I then wager your organisation is so small that it doesn't matter. And the same goes for effectively everyone.

The question then becomes do they need us more than we need them?

I’d argue that the answer is yes. The key is organizing collectively.

I previously thought this was extremely unlikely. But a lot of the happy-clappy veneer seems to be coming off on the inside. Even this week with net neutrality, (within my tech-monopoly) the number of people who want to do something and are pissed off with:

”you don’t understand technology policy, monkeys; we have lobbyists, do anything and get fired”

... coming down from the top, is much larger than I’d expected.

> The key is organizing collectively.

The key is collectively agreeing on something. After that, everything else is an implementation detail.

"Coders of the world, unite: can Silicon Valley workers curb the power of Big Tech?"

https://www.theguardian.com/news/2017/oct/31/coders-of-the-w...

We (the engineering classes / actual technologists) need to do more to brighten the line between the technology and the motivations and incentives of the people putting up the capital (and the executives/lawyers/lobbyists they control).

I don't really agree with the article, but this is an awful defense. Abdicating responsibility and shifting blame is what gives the tech sector a bad name.

A quote comes to mind, and seems to fit quite well: Now I am become Death, the destroyer of worlds[1]. It's hard to know what Oppenheimer should have done differently in this circumstances, but at least he faced up to his part of the responsibility for what he had done.

[1] http://www.wired.co.uk/article/manhattan-project-robert-oppe...

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