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Comment by jjj123 | Hacker News Reader

I mostly agree with you but I do think you’re missing the most important piece: who has power and leverage.

Low level employees don’t have much power (in the US at least) so they’re overworked and underpaid. Senior leadership are literally the people who make the rules, so they’re not going to force the same degrading conditions on themselves as they put on low level workers.

Then there’s something like the cushy engineering jobs some of us have in SV, that’s because they have power in the form of a labor shortage and can demand good working conditions.

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> ...have power in the form of a labor shortage...

It can be much more than this. A short order cook might prepare $1,500 worth of food in a shift. $30,000 in a month. It's hard work in a busy diner.

As an extreme example, at one point, WhatsApp had 40 software engineers and 400,000,000 users. That's 10,000,000 users per engineer. If a user was worth $1/month, they were each responsible for $10,000,000 per month in revenue.

That's an extreme, but even at my company, for example, one engineer is responsible for about $200,000/month in revenue.

Generally, I agree you. In engineering orgs, it seems like the social dynamics of the org distribute who is perceived to be creating that value in a non-average way. e.g. the engineers improving reliability are probably perceived as less valuable than engineers putting out user visible changes. This seems to be what happens by default, unless leadership is self-aware enough to mitigate.

Attributing revenue to the short order cook is a lot easier than the engineer. (Sales people are also easier to quantify.)

I hear that and I do think that raises the ceiling for pay, since you can pay engineers a ridiculous amount of money and they’re still a net positive.

If there was a surplus of engineering talent I guarantee you our salaries would drop significantly, no matter how much profit we generate. Under capitalism, there’s no incentive to scale workers’ pay based on how much value they bring. Even in your examples, the engineers that pull in 200k/month for the company are making a tiny fraction of that, and if they start making 400k/month on average it’s unlikely salaries would increase if pressures in the labor market are unchanged.

Edited for clarity

The problem is you can pull any old programmer in off the streets to work on the stuff that brings in 200k/mo per person, so I'm doubtful there will be a surplus of engineering talent at the desired skill level.

What does that have to do with capitalism, or any -ism?

You would not pay $4 to seller A for the same apple that seller B is selling for $1. Attempting to maximize utility to cost ratio is natural, maybe even necessary as it would convey evolutionary advantages.

I think that OP just means that capitalism, as a system, has absolutely no incentive to increase wages as productivity increases, it's a race for profits so extracting maximum profit is the metric. It's this reliance on a single metric that, for me personally, is a major failure of the current economic system to provide not only wealth and innovation but also good standards of living for people.

I'm a bit of a humanist and quite leftist in my views though, not a communist by any means but I will always try to look into economic systems with this more humane optic.

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