The "Passive Income" trap ate a generation of entrepreneurs • Hacker News Board

Re: The "Passive Income" trap ate a generation of entrepreneurs

#261

Post by lotsofpulp » Fri, Apr 17, 2026, 6:39 PM UTC

circumcised wrote: post #259

lotsofpulp wrote: post #257

Earlier quoted context omitted.

> A health insurance company can easily manipulate claim stats by paying claims to doctors/healthcare companies owned/operated by the health insurance company. Essentially moving money from one subsidiary to another. No, they can’t. They don’t even own hospitals, where a good portion of the spending happens. Nor do they own the medicines that are the highest profit margin item in the whole healthcare chain. > It does…

Take United Healthcare for example. They own... Optum Health: Delivers care directly to patients via local medical groups, urgent care centers, and surgical facilities. Optum Care: A major component of Optum Health, this network employs or partners with physicians across the country to provide value-based care. Optum Rx: Pharmacy care services. International: Owns and operates healthcare facilities in South America a…

[dead]

Re: The "Passive Income" trap ate a generation of entrepreneurs

#262

Post by watt » Fri, Apr 17, 2026, 6:42 PM UTC

lowbloodsugar wrote: post #246

hn_throwaway_99 wrote: post #74

This article really felt like a misdiagnosis to me. Sure, a lot of these people were just buying hype from these "get rich from drop shipping!" influencers, just like a million other suckers who got dollar signs in their eyes with real estate schemes, pyramid sale schemes, yada yada, a tale as old as time. I don't think this "passive income" trap is really anything new, and I don't think it was some unique thing that…

The US economy is in a death spiral. It’s where the UK was after WW2: lost an empire, didn’t want to admit it or address it. The foundational jobs of the economy - blue collar work - are gone. There simply aren’t enough people with jobs at each layer to support the businesses and jobs in the next layer up. The US will discover its total inadequacy if it gets into a war with China. We just can’t build weapons as fast…

> if they wanted to switch to pumping out destroyers, missiles and drones

This is such a naive take. Nobody is coming to US to try to outgun you. The moment petrodollar wobbles, the moment US Dollar stops being the world reserve currency, the game will be over for you. You will discover what it really means to be competitive, once the world stops giving you goods essentially in exchange for glass beads.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#263

Post by lowbloodsugar » Fri, Apr 17, 2026, 7:34 PM UTC

watt wrote: post #262

lowbloodsugar wrote: post #246

Earlier quoted context omitted.

The US economy is in a death spiral. It’s where the UK was after WW2: lost an empire, didn’t want to admit it or address it. The foundational jobs of the economy - blue collar work - are gone. There simply aren’t enough people with jobs at each layer to support the businesses and jobs in the next layer up. The US will discover its total inadequacy if it gets into a war with China. We just can’t build weapons as fast…

> if they wanted to switch to pumping out destroyers, missiles and drones This is such a naive take. Nobody is coming to US to try to outgun you. The moment petrodollar wobbles, the moment US Dollar stops being the world reserve currency, the game will be over for you. You will discover what it really means to be competitive, once the world stops giving you goods essentially in exchange for glass beads.

Sure. If US leaders had sense, they wouldn’t engage adversaries they can’t beat. I’m not saying China will start this war. I’m saying China doesn’t need to. China can just watch it happen. Like the US watched the British in Suez. But the US might start something and that’s how they’ll discover they are the just the last of the failed empires.

Pretty sure the current administrations end game here is copying North Korea. The rich have enough oil in Texas to perpetuate their lifestyle, while violently suppressing all opposition.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#264

Post by antisthenes » Fri, Apr 17, 2026, 7:59 PM UTC

bluGill wrote: post #231

ghaff wrote: post #75

Earlier quoted context omitted.

By working and investing. More successfully at some points than others. But you’re totally right that different people are better set up and more or less inclined to move on from a job than others.

The larger message is young people cannot get passive income in a short time. Sure there are a few born rich, and a tiny handful who by luck and skill (both are needed) get rich quick. However for the vast majority passive income is a long slog of saving a little here and there. (there is a third option - really lower your standard of living so you need almost nothing to live - get a good job but live in a tent city…

> Sure there are a few born rich

A LOT of Millenials were born rich. They may not have realized it, but now that boomers are dying off, it is stratifying Millennials through inheritance.

A lot of them have and continue to receive massive wealth transfers from their boomer parents through free-ish rent, gifts (aka pay for your down payment on a house), etc, etc.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#265

Post by tech_ken » Fri, Apr 17, 2026, 8:05 PM UTC

> But zoom out and what you had was just an enormous machine converting human ambition into noise

Calling it “ambition” is generous IMO. Passive income chasers always give “desperation” more than “ambition”. I also feel a bit weird about mourning “a diverted generation of entrepreneurs”, personally I feel like this generational obsession with entrepreneurship almost forcibly led to the dropshipping scams we see today. In a world where everyone is constantly trying to get some side project off the ground of course some folks are going to pursue the shortcut version of that.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#266

Post by nunez » Fri, Apr 17, 2026, 8:23 PM UTC

> If you've tried to google "best [anything]" in the last five years and gotten a wall of nearly identical listicles, all with the same structure ("We tested 47 blenders so you don't have to!"), all making the same recommendations, all linking to the same Amazon products, you've experienced the results.

This also ruined Reddit as the source for this research. Before social media growth hackers figured out how to run campaigns on Reddit (around three years ago feels right, though I'm sure it's been happening at a smaller scale for a lot longer), you could type "best $THING site:reddit.com" and be fairly sure that you'll get a discussion about really good products amongst actual people. Nowadays, you can be fairly sure that most of the discussion is astroturfing, with some of it being completely AI-generated.

This is also ruining my _other_ use case for Reddit: finding good places to eat in my favorite cities recommended by locals that live there.

> podcast hosts interviewing each other in an endless circle of mutual promotion where everyone claimed to make $30K/month

It's always $30k/mo _revenue_. Never profit. We don't talk about profit.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#267

Post by pdonis » Fri, Apr 17, 2026, 8:27 PM UTC

jimbokun wrote: post #145

pdonis wrote: post #68

One thing in the article struck me as way too optimistic: > What actually makes money hasn't changed. You find something people need. You get good at providing it. You charge a fair price and you keep showing up even when it's tedious and even when you don't want to. You build relationships over years. You build reputation over years. You can make money doing this, yes--but most people who are really rich don't. Ther…

Apple makes devices people like and use. Many people loved their Teslas. Netflix makes shows people enjoy. Facebook really did help people stay in touch with friends and family before replacing it with the Feed of Rage. Google was far better than anyone else at finding things on the early web. I would say really successful companies at least go through a stage of Building Something People Want. Even if they stray fro…

How many people got really rich as a result of Apple, Facebook, and Google doing things that created actual value? I get that all those companies are really rich, but most of the people involved aren't.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#268

Post by nunez » Fri, Apr 17, 2026, 8:28 PM UTC

Loughla wrote: post #85

hn_throwaway_99 wrote: post #74

This article really felt like a misdiagnosis to me. Sure, a lot of these people were just buying hype from these "get rich from drop shipping!" influencers, just like a million other suckers who got dollar signs in their eyes with real estate schemes, pyramid sale schemes, yada yada, a tale as old as time. I don't think this "passive income" trap is really anything new, and I don't think it was some unique thing that…

We started a trophy and award business because my spouse was already making shirts and stuff so we had most of the equipment. The overhead is really low thanks to quick shipping from a large employee owned national supplier (seriously, JDS industries is fucking awesome). It's enough to pay for itself easily and pay for a vacation or two a year, for about 4 hours of work a week. If we really put effort in, it could re…

100%. It should be cool to make enough with a business to live a comfortable life, not enough to hoard LITERALLY ALL OF THE MONEY at the sake of others.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#269

Post by pricingpeel » Fri, Apr 17, 2026, 8:29 PM UTC

the "giving a shit is by definition not passive" line is the whole essay imo. everything else follows from that.

the piece ive been thinking about though is the distinction between extractive info-products and compiled info-products. the affiliate blog churning out blender reviews someone never touched is extractive. but a furniture maker who writes a book about furniture making, from 20 years of doing it, isnt really "passive income" even if the book sells while they sleep. its just consulting-at-scale. the work was front-loaded, not absent.

the trap as she frames it is when the book comes first and the 20 years of experience never happens. when the product IS the meta-product about how to make the product. thats the ouroboros she nails.

fwiw im currently 4 days into a 30-day experiment shipping public work daily before asking anyone to pay for a compiled version. its painful in a way the "passive" framing cant accommodate, which is probably a sign its real. the people who sold "passive" never had to live through the days where nothing happens.

Re: The "Passive Income" trap ate a generation of entrepreneurs

#270

Post by nunez » Fri, Apr 17, 2026, 8:30 PM UTC

hunter-gatherer wrote: post #118

hn_throwaway_99 wrote: post #74

This article really felt like a misdiagnosis to me. Sure, a lot of these people were just buying hype from these "get rich from drop shipping!" influencers, just like a million other suckers who got dollar signs in their eyes with real estate schemes, pyramid sale schemes, yada yada, a tale as old as time. I don't think this "passive income" trap is really anything new, and I don't think it was some unique thing that…

Didn't feel like a misdiagnosis to me. My spouse around 2017 was one of those that got sucked into a course to earn income with an Amazon store. As I read the article basically every point resonated with my experience. The dog walking business example was also appropriate in my mind. My spouse fortunately broke even, minus time, on her attempt with drop shipping garbage nobody really needs. Now she makes decent money…

Dropshipping was also MASSIVE in /r/startup at around this time. I even got caught up in it: I spent a spell on flipping designer clothes found at thrift stores on eBay (overall lost more than I made, though not by much. Surprisingly intense business; definitely not passive.)