The rise of the corporate colossus is a giant problem • Hacker News Board

Re: The rise of the corporate colossus is a giant problem

#31

Post by sharemywin » Thu, Sep 15, 2016, 6:48 PM UTC

nonameface wrote: post #29

throwaway729 wrote: post #21

Earlier quoted context omitted.

Gvien the forum we're on, it's worth pointing out that today's white collar laborers are capturing one or two orders of magnitude less of the value they're creating than the blue collar workers of 1990's detroit. 360 billion* divided by 1.2 million = 300000 "per employee". Typical salary to 40,000ish-100,00ish range for laborers/engineers. The disparity in those numbers isn't so bad at all. Conversely, 1 trillion div…

That is a direct quote from the article. The article states $36B as well, not $360B. "None of this helps the image of big business. Paying tax seems to be unavoidable for individuals but optional for firms. Rules are unbending for citizens, and up for negotiation when it comes to companies. Nor do profits translate into jobs as once they did. In 1990 the top three carmakers in Detroit had a market capitalisation of $…

I look it up Ford, GM had sales over 100B that year. assuming maybe Toyota as the 3rd.

Re: The rise of the corporate colossus is a giant problem

#32

Post by jackcosgrove » Thu, Sep 15, 2016, 6:48 PM UTC

throwaway729 wrote: post #21

sharemywin wrote: post #8

In 1990 the top three carmakers in Detroit had a market capitalisation of $36 billion and 1.2m employees. In 2014 the top three firms in Silicon Valley, with a market capitalisation of over $1 trillion, had only 137,000 employees.

Gvien the forum we're on, it's worth pointing out that today's white collar laborers are capturing one or two orders of magnitude less of the value they're creating than the blue collar workers of 1990's detroit. 360 billion* divided by 1.2 million = 300000 "per employee". Typical salary to 40,000ish-100,00ish range for laborers/engineers. The disparity in those numbers isn't so bad at all. Conversely, 1 trillion div…

Not only that, but in US salaried status is routinely used to avoid paying overtime, when overtime is a tacit requirement of many jobs.

Re: The rise of the corporate colossus is a giant problem

#33

Post by dv_dt » Thu, Sep 15, 2016, 6:48 PM UTC

BurningFrog wrote: post #20

A libertarian explanation is that in the age of the Regulatory State, it's often more important to be the biggest lobbyist than to make the best product. "In the Game of Crony Capitalism, you lobby or you die."

That line of explanation was never satisfying to me because it doesn't adequately address what happens when any company gets so large that they can apply a full range of non-regulated techniques to extract rents far above value provided?

Without government don't you get the the same place faster?

Re: The rise of the corporate colossus is a giant problem

#34

Post by fra » Thu, Sep 15, 2016, 6:51 PM UTC

throwaway729 wrote: post #21

sharemywin wrote: post #8

In 1990 the top three carmakers in Detroit had a market capitalisation of $36 billion and 1.2m employees. In 2014 the top three firms in Silicon Valley, with a market capitalisation of over $1 trillion, had only 137,000 employees.

Gvien the forum we're on, it's worth pointing out that today's white collar laborers are capturing one or two orders of magnitude less of the value they're creating than the blue collar workers of 1990's detroit. 360 billion* divided by 1.2 million = 300000 "per employee". Typical salary to 40,000ish-100,00ish range for laborers/engineers. The disparity in those numbers isn't so bad at all. Conversely, 1 trillion div…

Comparing yearly wage with market cap makes no sense. You should be looking at gross profit / year.

Re: The rise of the corporate colossus is a giant problem

#35

Post by sharemywin » Thu, Sep 15, 2016, 6:55 PM UTC

throwaway729 wrote: post #21

sharemywin wrote: post #8

In 1990 the top three carmakers in Detroit had a market capitalisation of $36 billion and 1.2m employees. In 2014 the top three firms in Silicon Valley, with a market capitalisation of over $1 trillion, had only 137,000 employees.

Gvien the forum we're on, it's worth pointing out that today's white collar laborers are capturing one or two orders of magnitude less of the value they're creating than the blue collar workers of 1990's detroit. 360 billion* divided by 1.2 million = 300000 "per employee". Typical salary to 40,000ish-100,00ish range for laborers/engineers. The disparity in those numbers isn't so bad at all. Conversely, 1 trillion div…

Funny cause amazon is closer to the 330K per employee mark. Wonder why their P/E is so high? Assuming it took all of walmart's sales it would only get 4 times bigger then now. how much profit can it extract?

Re: The rise of the corporate colossus is a giant problem

#36

Post by sharemywin » Thu, Sep 15, 2016, 6:56 PM UTC

fra wrote: post #34

throwaway729 wrote: post #21

Earlier quoted context omitted.

Gvien the forum we're on, it's worth pointing out that today's white collar laborers are capturing one or two orders of magnitude less of the value they're creating than the blue collar workers of 1990's detroit. 360 billion* divided by 1.2 million = 300000 "per employee". Typical salary to 40,000ish-100,00ish range for laborers/engineers. The disparity in those numbers isn't so bad at all. Conversely, 1 trillion div…

Comparing yearly wage with market cap makes no sense. You should be looking at gross profit / year.

it would look even more out of wack. Tech companies are way more profitable.

Re: The rise of the corporate colossus is a giant problem

#37

Post by rdtsc » Thu, Sep 15, 2016, 7:00 PM UTC

BurningFrog wrote: post #20

A libertarian explanation is that in the age of the Regulatory State, it's often more important to be the biggest lobbyist than to make the best product. "In the Game of Crony Capitalism, you lobby or you die."

Isn't this a common libertarian fallacy - that government and private enterprise are 2 separate entities. Government is bad and should be restricted from interference and private enterprise should not be regulated and market forces will auto-converge to some nice maximum.

In reality there is really not that much difference between government and large enterprises. Funny enough that can also be reconciled with the libertarian dream, perhaps by simply viewing bits of the government as extensions or private enterprise. So FDA is a subsidiary of Monsanto, FCC of Verizon and so on.

So what is the fastest and easiest way to make a most profit - change regulatory environment, lobby, and so on.

This works for large companies and down to individuals as well. We just saw in latest DNC leaks, there is a price you pay and you get named ambassador in some picturesque European country.

Re: The rise of the corporate colossus is a giant problem

#38

Post by BurningFrog » Thu, Sep 15, 2016, 7:02 PM UTC

rayiner wrote: post #30

BurningFrog wrote: post #20

A libertarian explanation is that in the age of the Regulatory State, it's often more important to be the biggest lobbyist than to make the best product. "In the Game of Crony Capitalism, you lobby or you die."

The problem with the libertarian explanation is that it contradicts the actual facts. The "age of the Regulatory" state started in the 1930's. It has been in decline for decades--with major sectors of the economy being deregulated in the 1980's and 1990's. In the 1950's and 1960's, regulatory agencies often had the power to directly exclude potential competition and set prices for goods. They have a fraction of those…

> It has been in decline for decades

I don't have time to put together a great convincing case, so I'll just say that this is very different from my view. Some high level regulations have been removed, sure, but meanwhile almost every corner of life now has regulations and regulators that have to be obeyed and asked for permission.

It would be nice to have some kind of objective measure(s) of the overall level of state regulation, rather than trade anecdotes/gut feels. Some economist has probably done that already.

Re: The rise of the corporate colossus is a giant problem

#39

Post by Eridrus » Thu, Sep 15, 2016, 7:05 PM UTC

sharemywin wrote: post #31

nonameface wrote: post #29

Earlier quoted context omitted.

That is a direct quote from the article. The article states $36B as well, not $360B. "None of this helps the image of big business. Paying tax seems to be unavoidable for individuals but optional for firms. Rules are unbending for citizens, and up for negotiation when it comes to companies. Nor do profits translate into jobs as once they did. In 1990 the top three carmakers in Detroit had a market capitalisation of $…

I look it up Ford, GM had sales over 100B that year. assuming maybe Toyota as the 3rd.

Making cars is pretty capital intensive; Ford's Market Cap in 1990 was in the ~20bn range depending on what point you look at.

Re: The rise of the corporate colossus is a giant problem

#40

Post by B1FF_PSUVM » Thu, Sep 15, 2016, 7:06 PM UTC

BurningFrog wrote: post #20

A libertarian explanation is that in the age of the Regulatory State, it's often more important to be the biggest lobbyist than to make the best product. "In the Game of Crony Capitalism, you lobby or you die."

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