Crony capitalism may be cannibalizing productive capitalism in the U.S. • Hacker News Board

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#71

Post by api » Fri, Jun 23, 2017, 4:49 PM UTC

rm_-rf_slash wrote: post #44

zackmorris wrote: post #39

I think the great problem of our time is that the challenges get easier to solve every day but we mostly spend our time making rent. And not the kind of rent mentioned in the article - just plain old fashioned too-much-month-not-enough-money kind of rent. When we’re desperate, we grovel and do whatever work we need to to survive. This is akin to how researchers spend inordinate amounts of time applying for grants rat…

Or simply, our means of production have become so efficient that it didn't matter whether you were right or wrong, things would still hum along and the profits would continue. In the agricultural age, if you fucked up a harvest, you and your family could starve. Before agriculture, if you fucked up a hunt, your whole kin-clan could starve. Nowadays, if you fuck up the housing market, and millions of people go bankrup…

Many people have proposed variations of this as the reason civilizations collapse. They are destroyed by their success. They gain so much surplus that it completely isolates them from any kind of feedback mechanism, over time causing them to completely rot from within. Eventually the core becomes so rotten that the whole system falls apart. This can be sudden.

I think an intuitive grasp of this is why so many conservatives have a natural disdain for welfare. But I think their disdain for welfare at the individual level is misplaced. The isolation of the most powerful and largest scale systems from consequences at the macro level is a far larger problem than the isolation of individuals from consequences at the micro level. Welfare can indeed become addictive and lead to a "welfare class," but these are largely powerless and relatively poor people who may be somewhat of a burden on society but do little damage otherwise. The real danger is a rich powerful professional welfare class that makes big ugly mistakes and is isolated from the consequences of these by power and abundance.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#72

Post by eric_h » Fri, Jun 23, 2017, 4:50 PM UTC

dudul wrote: post #51

Not native english speaker here. My comment is probably of very limited value, but mostly for my personal improvement :). When I read "the wrong kind of entrepreneurs flourish in America" it surprises me to not see: "the wrong kind of entrepreneurs flourishes in America". I understand that "kind" should be the subject of the sentence, not the entrepreneurs. I have seen this construct several times (e.g. "this type of…

You are correct, "kind" is the subject of the sentence and the right conjugation would be "flourishes". You are also correct that it's a very common error that has generally just become acceptable.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#73

Post by kem » Fri, Jun 23, 2017, 4:52 PM UTC

deathhand wrote: post #4

frgtpsswrdlame wrote: post #2

Just to kick off some discussion. Do you guys think that the shift from on-prem to SaaS is indicative of a move towards rent extraction?

Not necessarily as overhead operational costs are lowered with the SaaS model and that's not true 'rent'. Licensing fees would be considered 'rent' but obviously necessary as a motivator for production.

I agree with the "not necessarily" part, but one thing that concerns me is in seeing large, critical institutions, like large hospitals and universities, outsourcing critical infrastructure off-premises.

If you look at operational costs per se, and licensing fees in a scenario like that, you're missing a huge proportion of the most threatening costs. Consider hospitals, for example, and recent problems with ransoming electronic health system data.

What concerns me with SaaS is that the biggest costs are very catastrophic or serious risks (like lock-in dependencies, or hacking due to monocultures--by the way, is that a formal, modeled concept in computer security, like it is in agriculture? The vulnerability of a market to "infection" due to monocultures?) that are maybe high probability over a very long-term period, but very low over a short-term period, and hidden.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#74

Post by jonnathanson » Fri, Jun 23, 2017, 4:52 PM UTC

bogomipz wrote: post #12

From the article: >"Because it’s just a transfer from one person to another, rent doesn’t necessarily make an economy less efficient -- it’s just often unfair. " I would argue that "rent" does make the market more inefficient. The more rent these companies can extract from consumers the larger their lobbying budget and the more campaign donations they can make at all level of government. Political lobbying is the big…

Rent is traditionally seen not so much as a cause of inefficiency, but the effect of inefficiency. Rent can almost be seen as wasted efficiency. It's the efficiency (or surplus) taken off the table by the monopolist.

But your point about further concentrating power and enabling further regulatory capture, and hence, more rents, is an important one.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#75

Post by clamprecht » Fri, Jun 23, 2017, 4:53 PM UTC

dudul wrote: post #51

Not native english speaker here. My comment is probably of very limited value, but mostly for my personal improvement :). When I read "the wrong kind of entrepreneurs flourish in America" it surprises me to not see: "the wrong kind of entrepreneurs flourishes in America". I understand that "kind" should be the subject of the sentence, not the entrepreneurs. I have seen this construct several times (e.g. "this type of…

I think you're right. To me, the sentence should either be "the wrong kinds of entrepreneurs flourish..." or "the wrong kind of entrepreneur flourishes..." But this is a common error, and most people probably don't notice it.

A related thing I've noticed is that in British English, they refer to companies as plural. For example: "Google are going to acquire company X", whereas in American English, you usually see: "Google is going to acquire company X."

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#76

Post by sadfjhsdf66 » Fri, Jun 23, 2017, 4:54 PM UTC

pm90 wrote: post #45

arcanus wrote: post #40

Earlier quoted context omitted.

> "First, let's assume the cow is a sphere". It is worse than that, because at least physics is validated by experimental data. Much of (macro in particular) Economics is a set of axioms that are seldom predictive.

And yet, people swear by them as though they have the same validity as physics. I never really understood that mentality.

Because the monopolies have exerted pressure on public education, including universities, to churn out advocates for the corporations bottom line.

With no basis in reality, we've brainwashed people to believe the bottom lines of the elite are to be protected. That's the outcome sought of our educational system.

It fascinates me how, on the one hand, we complain about how lazy people are. How much inducement the proles need. "Oh they're just lazy. Push em harder."

If we need to push people that hard, perhaps "economy of effort" is built into the species. It's a weird cognitive dissonance.

"They want something for nothing! But I want to maintain my elite status built upon your efforts!"

But that challenges the basis of elite power. If we all quit producing for them, they lose. So we're "induced to produce" under the constraints they define: no food, shelter, healthcare.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#77

Post by pascalxus » Fri, Jun 23, 2017, 4:54 PM UTC

balls187 wrote: post #24

I read the opening paragraph, them skimmed through the rest of the article looking for concrete examples of "Wrong Kind" of Entrepreneurs. I have a hard time imagining tech entreprenuers are the "wrong kind." They may disrupt by circumventing the law, but I don't buy the argument that they're not producing something of value in return.

mostly, they're not talking about tech entrepreneurs. they're talking about established industries like: ISPs, pharamecuticals, patent trolls and patents in general and various other monopolies.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#78

Post by rtx » Fri, Jun 23, 2017, 4:54 PM UTC

pm90 wrote: post #45

arcanus wrote: post #40

Earlier quoted context omitted.

> "First, let's assume the cow is a sphere". It is worse than that, because at least physics is validated by experimental data. Much of (macro in particular) Economics is a set of axioms that are seldom predictive.

And yet, people swear by them as though they have the same validity as physics. I never really understood that mentality.

Because roots of these theories are in Physics. Psychology > Biology > Chemistry > Physics.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#79

Post by petra » Fri, Jun 23, 2017, 4:55 PM UTC

fragmede wrote: post #50

frgtpsswrdlame wrote: post #2

Just to kick off some discussion. Do you guys think that the shift from on-prem to SaaS is indicative of a move towards rent extraction?

Maybe if you're an economist. If you're an accountant, categorizing Saas as OpEx (vs CapEx) certainly also make it seem that way. However, as a software developer, calling it rent-extraction glosses over architectural differences and value derived from not having servers tucked away in an office closet. Flexibility and capacity on the server-end, as well as huge benefits of software distribution over web-browser redu…

Well, non-rent model would be you buy the software(forever, if you want you can pay for updates), and in a click of a button you get hosting+backups etc, with some very cheap monthly rent(which is a more realistic representation of that part of the work). And you own that bundle of software + data.

Re: Crony capitalism may be cannibalizing productive capitalism in the U.S.

#80

Post by bertjk » Fri, Jun 23, 2017, 4:56 PM UTC

balls187 wrote: post #24

I read the opening paragraph, them skimmed through the rest of the article looking for concrete examples of "Wrong Kind" of Entrepreneurs. I have a hard time imagining tech entreprenuers are the "wrong kind." They may disrupt by circumventing the law, but I don't buy the argument that they're not producing something of value in return.

If someone has to violate the law to produce value, then it is likely that they haven't really "produced" any value. More likely they are simply stealing from the commons.