Can confirm. I worked a pretty decent software job with lower pay than others make for the same job for the past 5 years. Could barely afford insurance for my wife and I. We actually had to just give up and not pay for it the first few months of this year before I was laid off, figuring that paying the "fine" for not having health insurance plus whatever unlikely emergency medical costs we might have was cheaper. As soon as I'm laid off, we're on public aid and have the best insurance, and since every job I applies to rejects me, and haven't found any freelance work through sdegutis.com yet, it looks like we'll have a few more months of being able to have better health insurance than I could afford when working a decent programming job. The system is broken and literally ridiculous.
The right answer is to lie, cheat, steal, and hurt those who are one step ahead of you because they've figured out "the game".
even better: lie, cheat, steal, and hurt those who are ten steps ahead of you. they're the ones with all the money.
I'm sure there's got to be a way of getting ahead that doesn't involve lying, cheating, or stealing, from anyone, no matter how much they deserve it.
I ain't a historian or a philosopher or an economist, but at 37-year old with a relatively eventful life I have the ever-accumulating feeling that the whole system is rigged against everyone except the people at the very top.
Most of us aren't scientists that record their every impression and what it was based on so I can't really tell HOW that feeling grew and solidified in me, but it's a fact that it has been a background observation of mine ever since I hit 12-13 years old, long before being educated on the global economics, wars and social systems.
When you figure out what that is let me know.
Please do not mention getting lucky
yeah, i have to agree.
but, if someone has already made the decision to lie cheat and steal, why target someone just one step above? it seems better to take from someone with a whole lot more than everyone else.
The whole credit card system in US is made to rip off "stupid" people, extremely so.
Nobody writes about that, probably because everyone from US thinks it's normal, and nobody from the rest of the world knows about it.
But that system is made to screw all the people who are not good at personal finances.
Or maybe (many) poor people are acting rationally given their economic circumstances.
See ["Reframing the Debate about Payday Lending"](http://libertystreeteconomics.newyorkfed.org/2015/10/reframi...) (a pop summary of ["Interest rate caps and implicit collusion: the case of payday lending"](http://www.inderscience.com/info/inarticle.php?artid=58089), DeYoung & Phillips), or other articles linked [this episode of Freakonomics](http://freakonomics.com/podcast/payday-loans/). These articles are about payday loans, not credit card debt, but (1) some (but not all!) of the same concerns apply; and (2) I suspect much discussion of “poor people” and “credit cards” lumps together these forms of debt anyway.
I've seen other comparisons of payday loans to banking services for low-wealth individuals. (I don't have these at hand. I think Bannerjee & Duflo's _Poor Economics_ may cover some of this.) The banking services and fees that middle-class individuals see aren't available to the poor, so it's easy to draw false conclusions if you're generalizing from your own circumstances instead of studying theirs.
I agree that “the system” is screwing poor people. It's less obvious to me that this is because the poor aren't good at personal finances (let alone that they're “stupid”), and therefore that education would largely address this – although, according to some studies summarizes in the DeYoung & Phillips work, it might make some difference.
Yep. This whole thread is full of cringe. TFA was about how silicon valley & Washington are The Elites -- out of touch with the working class and what are everyday problems for a huge swath of America. And the top 3 comments from the elite are:
- Poor people are stupid
- Poor people are bad at personal finance
- More/better education (government) will help
Did everyone suddenly forget all the un/underemployed college graduates we've got? Are they stupid, too?
Just a shocking lack of empathy here.
You are twisting my words. I never said poor people are stupid or the other way around.
I said the US credit card system puts people without insight into finances in a serious disadvantage. No sorry, it rips them off. And nobody is talking about it, because it seems everybody thinks it's normal.
Explain your credit score to a European for example, and you will be met with a blank stare or disbelief.
What do you mean by "a European"?
https://www.economist.com/news/economic-and-financial-indica... : Household debt to personal income, 2012; the United States is below the OECD average and very much below some northern European countries.
https://data.oecd.org/hha/household-debt.htm France and Germany seem to be the only major economies much lower than the US in household debt, and the US deleveraged after 2008; it is now in the same ballpark.
http://www.businessinsider.com/eurostat-data-on-household-de... That's a hell of a URL, and the pictures are funny.
https://data.oecd.org/hha/household-net-worth.htm#indicator-... On the other hand, if you look at household net worth as a percent of disposable income, the US looks better than any OECD country except for Japan, Belgium, and The Netherlands.
Now, this is household debt, which includes mortgages as well as consumer debt. I haven't found any data that separates out the latter.
A European may not be familiar with a credit score, but they're more than a little familiar with credit.
You're still not quite getting it. If people have to choose between going into debt from a finance charge or starving on the street with no roof over their head they will choose the former. It's not about financial education it's about hard choices of the underprivileged.
I'm not talking about starving on the street, I'm talking about everybody in US using credit cards for payments and repay. I'm talking about shops offering their own credit cards.
You know when US people use their credit card? Every day. You know when Europeans use their credit card? When abroad. And our credit gets instantly paid by our normal bank account. For us, a credit card is the same as a debit card but with a delay on it.
Using a credit card is not the same as going into debt to make your purchase. In the US, you can easily get 1% to 4% back from the credit card company by using your credit card, and so you actually save money by paying with your credit card. Whether or not you want to pay off the balance at the end of your credit card's billing cycle decides whether or not you are going into debt, but many, many people pay it off. It's also safer to use a credit card for purchases than a debit card, since your cash isn't touched and you can just call the credit card company to dispute a charge.
Its not like you're just pulling free money out of thin air by using a credit card. And it seems likely that the finance institutions behind the credit cards are offering them as a product that makes money and not as an act of goodwill. If everyone paid their credit cards off at the end of the month like they say they do, do you think credit cards would be advertised or pushed as hard as they are? The finance institutions are making money on people who use them.
i'm sure there are some people are responsible enough to never incur a finance charge from a credit card by always paying their monthly balance. I've never actually met one of those people. I used to say I was one of those people, but in reality if you had asked to look at my statement history I would have been embarrassed by how many times I ended up paying interest charges for things I probably shouldn't have purchased in the first place.
Two years ago my wife and I cut up our credit cards, closed those accounts and never looked back. Initially that change hurt my brain and went against everything I thought I knew was normal. It was one one of the best financial decisions we ever made.
> i'm sure there are some people are responsible enough to never incur a finance charge from a credit card by always paying their monthly balance. I've never actually met one of those people. I used to say I was one of those people, but in reality if you had asked to look at my statement history I would have been embarrassed by how many times I ended up paying interest charges for things I probably shouldn't have purchased in the first place.
This is a really bizarre assertion: my bubble is such that I've literally never met someone (that I'm aware of, just as with your claim) who _doesn't_ pay their credit cards off in full each month. Hell, I don't think I've ever done anything but set auto-pay for my credit cards, and would turn it off on the rare occasion that I decided to use it as it was intended, as a liquidity buffer. (The difference between us being that I'm not narrow-minded enough to assume that this tells me something about credit cards in general as a product).
> Two years ago my wife and I cut up our credit cards, closed those accounts and never looked back. Initially that change hurt my brain and went against everything I thought I knew was normal. It was one one of the best financial decisions we ever made.
If you were having so much trouble, why not just use auto-pay from your bank account? I don't really understand this urge to universalize your inability to use credit responsibly to somehow claim that credit cards in general are a net negative. I don't mean "irresponsible" as an insult here: I don't keep desserts in the house because having to go out and get dessert when I want it is the most effective way for me to maintain my healthy diet in the face of my one dietary willpower weak spot (a wicked sweet tooth). But I don't justify my weakness by claiming that we'd be better of if dessert never existed.
 To be clear, I'm aware that the modern role sugar plays in most people's diet is unhealthy: I eat (non-fruit) sweets about once a week and I'm pretty happy with that level of consumption. To me, desserts are a delightful part of life, if you're adult enough to use them responsibly (excluding those unfortunate enough to have severely bad dietary habits from childhood: the deck is stacked against them physiologically).
> This is a really bizarre assertion: my bubble is such that I've literally never met someone (that I'm aware of, just as with your claim) who _doesn't_ pay their credit cards off in full each month.
That's one hell of a bubble. Almost no one does this. Source: worked customer service for an issuer for 18 months, ~150 calls/day, saw a broad cross-section of the customer base, and it was a rare day in which I talked to a monthly PIF.
Not so incidentally, that experience is also the reason why I so assiduously avoid revolving credit. If you're comfortably upper-middle-class or higher and assured of enough liquidity to cover whatever balance you choose to carry, it's a game you can play and win. If you're not, you're subsidizing those who are, not least because you're ineligible for the low-rate, high-credit-line points card products that monthly PIFs tend to qualify for.
And even if you're in the former category, it's still a hell of a risk to take, because if anything happens that negatively affects your liquidity in a significant way, you're suddenly a lot more screwed than you would be if you hadn't been using credit the way you were. A few times, I dealt with people who had found themselves in just that hole. There were worse kinds of calls to take, but not all that many.
We’re really trading off bubbles for bubbles here, aren’t we? It seems really unlikely customer service attracts a representative cross section.
I am also in the “don’t know (many) people who do anything other than autopay in their credit cards” bubble.
I’m aware that many people struggle with credit cards, but they’re not in my social circles.
> That's one hell of a bubble. Almost no one does this. Source: worked customer service for an issuer for 18 months, ~150 calls/day, saw a broad cross-section of the customer base, and it was a rare day in which I talked to a monthly PIF.
Yea... That's why I went out of my way to call it a bubble. The point of mentioning my bubble was that "I've never met anyone who doesn't carry a cc balance" isn't a sound basis for to making a claim about all credit card usage the way the parent comment was.
> even if you're in the former category, it's still a hell of a risk to take, because if anything happens that negatively affects your liquidity in a significant way, you're suddenly a lot more screwed than you would be if you hadn't been using credit the way you were.
I'm pretty sure you're messing up your math here. How could the addition of liquidity (plus deferment of payment by 30+ days) at zero cost possibly be making me more screwed, in the event of a serious liquidity crunch?
Talking of individual finance here. As long as you're sufficiently liquid again to PIF before your bills go past due, you're fine. If you're not, then not only do you accrue late fees - usually easy to have waived by just calling and asking for it, if you've been a highly diligent customer prior - but you also start accruing interest on the balances you're suddenly carrying, and you almost certainly lose preferred rates on those balances and find yourself paying north of 15% APR.
I'm probably halfway in between the working class and the tech bubble. In fact I grew up near the poverty line. I have a lot of lower class "technical debt" that I am still working to replace. Most recently my wife and were replacing the non-existent financial skills that my parents and public education system imparted to me. All of that to be said, it's no wonder we have polarized experiences with credit cards.
I did a quick Google search to make sure I wasn't completely off base here. According to the American Bankers Association Credit Card Market Monitor May 2016 report [http://www.aba.com/Press/Documents/ABA2016Q2CreditCardMonito...] 42.1% of Americans are Revolvers (carry a balance and pay interest) and 29.7% of Americans are Transactors who pay their bill in full each month.
I'm not insulted because we we're absolutely being irresponsible with our finances. We didn't have a budget to flow, we we're not saving money for future purchases, and we were very much not in control of where our money was going.
> But I don't justify my weakness by claiming that we'd be better of if dessert never existed.
I don't think I was suggesting that credit cards should never exist or that they are evil. I was trying to contrast the fact that even when 29.7% of people are benefiting from 1% - 4% cash back, that 42.1% are not. And that the companies who offer these products are in fact making money on them. Because people like me we're going into debt using them. And in my case, I was buying crap I didn't need and really shouldn't have bought because I truly couldn't afford it. Otherwise I would have always paid my balance in full at the end of the month.
I'd love to find a time series of those proportions; my sense is that 29.7% is wildly overestimated, but it has been a very long time since I was in that business myself. Curious whether the proportions have changed, or whether my perspective at that time was skewed by the nature of my tier 1 customer service role.
I'm sure it also depends on who you worked for. My unscientific instinct is that you're substantially more likely to see someone carry a balance on a Capital One or Target card then on an Amex or Costco visa because of the demographics.
MBNA, a few years prior to the BofA acquisition. The company mostly issued affinity cards, of which it was the largest US issuer (I want to say largest globally, but not sure, whereas US I am certain about) at the time. You got to see a pretty good cross-section.
> If everyone paid their credit cards off at the end of the month like they say they do, do you think credit cards would be advertised or pushed as hard as they are?
Yes. CC companies make money on every transaction (google keyword: interchange fee).
I am also one of those people that pays off my balance every month. In fact, I use an Amex charge card that is designed to be paid off every month.
If not using/having credit cards is what works for your family, more power to you. But don't assume just because I use a CC for my purchases I'm in debt or foolish. In fact there's a whole subculture of making money off of credit card offers (see /r/churning).
> If not using/having credit cards is what works for your family, more power to you. But don't assume just because I use a CC for my purchases I'm in debt or foolish. In fact there's a whole subculture of making money off of credit card offers (see /r/churning).
I don't think people are foolish for having credit cards. And certainly hope that my comment didn't paint credit cards or cardholders as evil.
I think there people like me, who grew up thinking that having a credit card payment was just how things worked. And if you wanted to splurge on something you could just put it on the credit card and pay it all off come tax return time. (Trust me I know how ridiculous this sounds, but this is what I learned growing up. I still see my friends and family continuing this insanity).
This thread is about getting outside of the tech bubble. I consider myself to be blessed having grown up in a low income bubble, it was very humbling. I also consider myself even more blessed to be trending towards the tech bubble. These two bubbles are very different and I was trying to provide some context to that difference. Hopefully this helped provide a different perspective.
> i'm sure there are some people are responsible enough to never incur a finance charge from a credit card by always paying their monthly balance. I've never actually met one of those people.
Hi, I'm one of those people. Nice to meet you!
We use our (no fee) credit card for everything we can and pay it off at the end of the month. Initially we did this to allow as much of our own money, for the longest possible time to sit in our mortgage. We've never paid a cent in charges, fees or penalties.
You can save incredible amounts over the years just by shifting the time at which your money sits where.
I've been doing similar. I realize that some people prefer to spend their money, including grocery shopping, somewhat spontaneously and for those people credit cards are probably a bad idea. But if you plan a monthly budget ahead of time there's almost no reason not to be using a credit card with a good rewards program. Different people value different things so what rewards program is the best is a more complicated issue. But purchasing via credit is only detrimental if you're spending more than you can pay back.
>And it seems likely that the finance institutions behind the credit cards are offering them as a product that makes money and not as an act of goodwill.
Correct, credit card companies take a fee on the transaction, which is in turn baked into the prices of all consumer goods.
To pay the normal price with something other than a credit card is to miss out on what you're already paying for.
Hi! I'm "magnetic" - nice to meet you!
It's not as uncommon as you think: many tools allow you to not miss payments nowadays, from email/SMS/push notification reminders to automatic payments.
If you have the money to afford what you buy on the CC, there is really no reason you should be paying any fees, unless you are sloppy with finances.
I believe you when you say you're hit with charges, but I also think you are the reason for it. Sorry! (nothing personal)
Hi magnetic, nice to meet you! Out of curiosity, where would you say you developed your money management skills? Was it from your parents, from school, or just organically as you started taking on more responsibility as an adult?
To acknowledge your point, I was definitely the reason for the interest charges. As I mentioned in other comments in this thread: growing up my parents didn't teach me much in the way of handling money responsibly. It took me almost 10 years of being an adult before I realized that I wasn't managing my money, but it was managing me.
Before two years ago I never created a monthly budget and stuck to it. The typical month looked like me spending way too much money in the first half of the month. Which led me to constantly checking my account balance in the second half of the month. When my checking account would start to get below about $200 I would shift spending over to my credit card. Next month I usually tried to pay it off. Sometimes I didn't and even worse sometimes it would take me a few months.
Its exhausting when I look back at all of the financial drama I dealt with until recently. Mostly because I never planned how my money was going to be spent with a monthly budget, but also because I bought stuff that I didn't need and couldn't afford.
The point I was trying to make with my original comment was: More people are likely to carry a balance on their credit cards than those who pay it off on time every month. I'm fairly certain the bubble I grew up in skewed my perception that everyone carried a balance on their credit cards. I knew people who said they paid it off every month, but when I asked them to be 100% accurate with that statement, they always backpedaled. At least I know of one person "magnetic" who actually pays their bill on time every month.
> Hi magnetic, nice to meet you! Out of curiosity, where would you say you developed your money management skills? Was it from your parents, from school, or just organically as you started taking on more responsibility as an adult?
I am not so sure I know the answer to that, but I've had to "live on my own" at 16 as my parents were living abroad and I was living by myself in an apartment while going to high school. They'd give me a monthly "budget" and I had to manage the money to deal with life expenses. Perhaps this helped.
One thing I always strived for was to not purchase something unless I could afford it cash. I couldn't do it for my house so it was the only thing I really got a loan for, and even that I worked really hard to pay it off faster than the required schedule (which isn't necessarily a smart thing to do financially speaking, but it has a "peace of mind" value to me that is worth it).
The other thing that helped is that I'm not extravagant with purchases and - except for the times when I had a mortgage to worry about - my income would usually be high enough that I wouldn't have to go through mental gymnastics to figure out whether I should worry about the end of month.
So I developed a mechanical "pay the credit card in full at the end of the month" process, and that was it. The rest would go to savings, and once the savings had enough (a few months worth of living expenses), the overflow would go into more risky investments (like stocks, etc).
I don't like automated payment systems so I avoid anything that gives automated access to my money to a third party, but I do like reminders for bills, and most online banking systems will provide reminders to you in due time and let you pay your stuff online easily.
I also try to keep the amount of accounts to a minimum: I have very few credit cards and bank accounts. It simplifies the management of money.
Lastly, I am from Europe, and the credit card madness isn't something I was exposed to when I grew up, so when I came to the US I didn't feel like I needed a CC. It was hard to get one in the beginning anyways, since I didn't have any credit history.
Credit card companies make money every transaction even without interest, so yeah, they would be pushed as hard as they are.
> You know when US people use their credit card? Every day. You know when Europeans use their credit card? When abroad.
To me, that's just evidence of how backwards many Europeans are in their approach to credit cards.
You seem to have an attitude that credit cards are inherently evil. They're just tools, which can be misused (and put you into debt) or used for maximum convenience (accruing rewards and protections along the way).
I challenge you to explain why the easy availability of credit and a highly functional credit market is a bad thing instead of throwing out blanket statements like that credit scores are "crazy."
It's less the availability of credit cards (they're highly available in a good many countries), it's more the assertion that if you're not using a credit card every day, there's something wrong with you. It's the fact that if you're not using a credit card in everyday purchases, you're losing the rewards and so essentially paying more for everything you buy - you're structurally punished for not participating.
Debit cards have much the same protections as credit cards in much of Europe. It's more likely that any benefits your bank wants to give you will come attached to your bank account (in return for depositing a certain amount of money per month) than that they'll push a credit card on you. Interchange fees are low enough (0.3% for credit cards and 0.2% for debit) that there's not much they can profitably provide, anyway - which means our prices aren't quite so inflated to cover the expense of serving credit card users.
Credit cards aren't bad, but the system of incentives that leads consumers in the US to believe they're the most rational choice is.
People regularly assert that credit cards are factored into the cost of goods, but I posit that's mostly untrue. The cost of most things, especially "luxury" goods like restaurants, is set by the price the market will bear—not the cost of providing that good. Anecdotally, it's certainly not cheaper that equivalent goods and services are cheaper in Europe despite the lower credit card usage.
It's very common for supermarkets in the UK, for example, to compete on margins on common food - not necessarily packaged/prepared food, but definitely the basics, fruit/vegetables/bread/milk/flour/eggs/etc. People have little loyalty to a specific supermarket and often have 2-3 within reasonable distance, so there's a very strong pressure to keep down the cost on these items - they're pretty much the proverbial widgets. The lower the cost to sell an item, the lower the supermarket can charge. Some supermarkets take technical losses every year, with most having falling profits every year.
This sort of thing affects poor people more than it affects people who are eligible for a credit card with a good rewards program in the first place. I'm sure you really don't care that your potatoes are 2-3% higher in price than they otherwise would be.
Right. The amount a producer can pass on to consumers via a higher price depends on the price elasticity of demand.
Credit cards always have a cost. You get 1.5% to 2% of your money back in rewards for a 3% fee.
In Europe, fees are limited to far below that, and the European debit cards are limited to below 1% in fees.
You don't get rewards from credit cards in that situation. In fact, credit cards always end up losing you money.
Credit cards are the tragedy of the commons - if no one used them, everyone would profit. But as long as some use them, everyone gets an advantage from using them.
> I challenge you to explain why the easy availability of credit and a highly functional credit market is a bad thing instead of throwing out blanket statements like that credit scores are "crazy."
Because it is risk. You have insanely high interest rates, high fees, you have a massive risk, and the security is basically nonexistent.
To pay money online, you usually use a standardized API that uses proper cryptography, and signs with a key embedded in your device or your debit card on a reader.
With a credit card, you pay with a simple number that anyone can just steal, and if you don't take care, you're fucked.
> With a credit card, you pay with a simple number that anyone can just steal, and if you don't take care, you're fucked.
You seem to deeply understand credit cards. There is practically no risk to using them. As a consumer, your fraud liability is zero and entirely shifted to the merchant.
Of course you should pay off the bill every month. I never pay interest, rewards more than cover any fees I pay (I average 4-5% return on credit card spend), and I really don't know what risk you're talking about.
> As a consumer, your fraud liability is zero and entirely shifted to the merchant.
If you have one with chip+PIN, as all in Europe, 100% of liability is with the customer.
So you have to check the statement every month, go through a lengthy process to appeal false charges, and end up not getting your money back either. Especially as you have to deal with your bank to get the money back instead of the CC company here, and the bank has a far easier process for reversing debit transfers than CC bills.
> If you have one with chip+PIN, as all in Europe, 100% of liability is with the customer.
Thankfully I don't have chip and pin, yet another reason I actually vastly prefer the American system to European.
You seem to just be providing examples of why the European system is worse for consumers, not proving in any way why it's better.
I am providing examples why the American system is worse in a European legal context.
You don't want CCs either. CCs solve security by having someone simply pay for every time a fuckup happens, instead of using cryptography to prevent them in the first place.
> In Europe, fees are limited to
> far below that, and the
> European debit cards are
> limited to below 1% in fees.
In the end, I always find the costs are broadly similar in the EU and the US.
Debit cards are widely used in Europe (maybe not in Germany), but people, when they want credit just goes to the bank and take a loan or something like that.
We use debit cards though. I don't see credit cards often, but I do see everyone with debit cards. I pay almost everything with it since it's free, I can't screw up (debit cards have limits, or in any case the total amount of your bank account), easy, etc. I've been offered credit cards by my bank, but I do not trust them so I prefer to use a debit one. Also, Fnac or even supermarkets do offer cards, but I don't see the point of having them, and I'd say most people do not pay attention to this offers.
I live in Spain, and I've seen a similar situation in other countries except in Germany.
Germany also heavily uses debit cards, actually. Like 90%+ of the population have an EC card (a German debit card network), in comparison to below 8% for credit cards.
It is more subtle than you think. In the UK the Consumer Credit Act means that the protections offered to the buyer are vastly better when paying by credit card vs debit card. Particularly online, you would be foolish to pay by debit rather than credit. That also drives consumer behaviour.
Actually, the UK has credit scores and credit cards, a large proportion of people use credit cards for daily spending.
Not only that, but your consumer rights are stronger when you use a credit card: http://www.which.co.uk/consumer-rights/regulation/consumer-c...
I'm afraid that's too strong of a generalization. I'm a European and I use my credit card daily (and getting a great value out of the benefits it provides).
We just have other types of debt. I know so many people paying 120-150% of the price of their TVs, vaccuum cleaners, kitchen appliances (like the €1224 Thermomix, which they've somehow convinced everyone must have), etc thanks to loans offered by subsidiaries of large banks and pushed by the shops.
This is basically Affirm's business too.
Quoting George Carlin:
"Trust me on this one folks, raisin oats are not a major purchase. ...and you're holding up the f*cking line, too!" (talking about people paying with CCs on a queue in a retail store)
"Nobody should be paying a bank 18% of interest for Tic-Tacs."
Not sure how accurate he was but IMO your parent commenter was expressing a sentiment that is relevant to these quotes.
In modern US stores, it's generally people paying with cash or check that "hold up the f*cking line" (paying with a credit or debit card is much faster).
That's a pretty interesting tidbit, thanks for sharing it.
In my country paying with a CC or a debit card is at least a 2 minutes dance and it gets awfully annoying for everybody on the queue.
One of the reasons why several months ago I moved on to buy stuff from local smaller stores that offer delivery at home and allow me make the order from their website -- no phone involved. And I am investing in local businesses, too, so it's a double win.
Back on topic, why exactly is paying with cash slower than with a CC? Very curious.
Most stores* have a point of sale machine where you either swipe the card or insert it into a slot for a few seconds, then tap a confirmation. You may be asked to tap a PIN (if using a debit card) or write your signature with a stylus (credit card), but I'm encountering this less and less often for small transactions. I suspect the companies involved have calculated that the extra time/processing isn't worth the potential savings from reducing fraud reimbursement on these small transactions.
Paying cash requires either the customer or the cashier to count out correct change, which generally takes longer than the above. Hand-writing a check takes even longer, though maybe partly because it is mostly elderly people doing it these days, and they tend to perform all activities more slowly (not that they can help it or that there's anything wrong with it).
*Small businesses sometimes still have older credit card machines that are a bit slower, but the number of these I encounter is fewer and fewer.
I understand. Basically your banks and financial insurers upgraded their system, and the retail stores followed suit by modernizing their machines.
Not happening in my country. The general attitude one could extract from the glacial pace of upgrading around here is "well, it works right? why would we spend money on touching anything?". This, in addition to pretty experienced and fast cashiers leaves me with the opposite impression you described.
Back to Carlin's quote -- are the CCs really working against your interests (pun half-intended)? I heard about the mythical 18% extra on small purchases several times. Is that actually true? Are you actually gonna get $1.18 off of your CC if you buy something for $1.00?
I do not see credit cards as the biggest problem. There is some incentive to abuse them, but using them every day is not the problem. I use them all the time, pay them off each month and enjoy benefits and protections not available via debit cards (so I have only of those and only use it when I'm in Europe :) ).
I personally see the incentives to borrow a hell of a lot of money to buy a house or a college education as much bigger issue.
>Did everyone suddenly forget all the un/underemployed college graduates we've got? Are they stupid, too?
I think you'll find the HN consensus is that they're stupid (or were tragically misled) for going to college in a major other than computer science or engineering.
Ok, I will bite. I do not think blanked statements "CS or fools" make any sense, but I think a number of folks who dedicated 4-8 years of their lives to getting a liberal arts degree did this without a clear idea of what they can realistically expect at the end and making backup plans.
A PhD in English or French culture may make sense, but one must realize that professional opportunities outside academia are sparse and number of positions in academia is small.
They're probably a lot worse inside academia for those fields. That said, everyone I know with an MA in English is doing really well for themselves, both inside and outside the academy. Maybe it's my small sample size though.
This argument is strong only if you consider a BS or BA program a vocational school.
It seems to be a fairly common viewpoint that your major should be vocational, and you should get a liberal education along the way in core and elective classes.
There are plenty of CS/engineering majors who end up un/underemployed too.
The UK seems to have a particular problem with this: https://www.studyinternational.com/news/uk-computer-science-...
Here in Austria, you have to behave really bad to not make a decent living if you can code, or at least pretend to be able to code. Developer conferences are _flooded_ with recruiters and CTOs trying to recruit.
That's true here too, but it's not true of every part of the US. If you're stuck somewhere with a weak labor market and unable to move, that's pretty much the only way you'd end up unemployed with a CS degree at this point in time.
I don't imagine it will continue like this forever, obviously, but the labor market is tight enough that I know multiple people who changed tired for a living, were waitresses, etc and went through a bootcamp and now make a solid living as an engineer. For those who actually have Computer Science degrees, the demand is infinitely higher.
major other than computer science or engineering
The unemployment rate for CS grads in the UK is 10%, one of the highest. It's been up as high as 13% in recent years. The skills shortage is a complete myth designed to lower wages by inflating supply.
Just tossing this out there, but do you think it might be marginally possible that not all CS grads are created equal and that on a bell curve, 10% is really not an insane amount to be the left-hand-side tail?
Wouldn't that be the same for all majors? Why are CS grads less employed that graduates in agriculture or civil engineering or even philosophy?
Because there's a glut of them.
> It's less obvious to me that this is because the poor aren't good at personal finances
Yeah, I'm not sure "good at" is the right framing. It's an arms race between asymmetric competitors. When exploiters have much more time and money to hone their exploitation, I don't think the problem is really with the exploited person.
The root cause of most American problems is poor public education. We're still over-emphasizing passing grades over effectively growing new American citizens...
Personal finance is rarely offered and never mandatory, yet we collectively bare the burden of financial ignorance. The same applies to other subjects like statistics or civics.
No it isn't. The root cause of America's problems is a deep-seated, societal belief that you can always blame the victim and attendant governmental malfeasance and neglect in actually fixing the numerous traps which ensure that when something goes wrong, everyone piles on until that person is destitute.
American society is setup to find someone, anyone to pin a problem on, even if it would ruin that person, just to ensure that "everyone" doesn't have to think or worry about it existing. It is writ large a tragedy of the commons, where everyone thinks the specific wrong they experience is unAmerican but everything else is a failure of rugged individualism and bootstraps.
I think you totally mis the point. It's not about education, it's about a system where you can't opt out of in US.
What is your credit score?
If you are from US, you probably know. If you are from somewhere else, you are probably staring at your screen saying "what???".
Shops giving out their own credit cards... crazy.
You can always choose to pay cash for everything you want, and eschew credit altogether, it's just so much harder to muster up the cash for big-ticket purchases like homes and automobiles that it's easier to game the system for credit building than it is to save for decades for a home to own.
It's not that you can't do it, but that trading potential future earnings for money now is so damned practical that it's hard to ignore.
I'm planning to do that. I am 2 thirds on my way to buy house with cash. No need to borrow any money. That will be my dream!
>We're still over-emphasizing passing grades over effectively growing new American citizens...
2/3rds of state legislatures are actively hostile to basic tenets of science, let alone the government teaching "effective American citizenship".
We just recently legalized malpractice for financial advisors. The rules preventing them from screwing their clients out of their retirement savings were spun as hurting consumer choice. Imagine how it'd be spun if there was a movement for public schools to teach "effective citizenship".
It would be nice if schools allocated more time for the young kids to get to share with teachers which topics that they wanted to know more about, just a block of unstructured time like the agoras of Ancient Greece. Just some form of rubric-free authentic curiosity-driven discourse, to break out of the teacher-student hierarchical relation a bit and to widen their understanding of learning, I suppose.
> We just recently legalized malpractice for financial advisors.
Do you have reference?
Link is from forbes, but you get the idea. Matt Levine mentioned it once or twice in his column a week or 3 ago.
Teaching terrorism, no doubt.
I didn't learn finance in Germany in school but we all knew that taking on massive debt is stupid. It's the advertising and easy access to consumer credit. Wage increases have been replaced by easier access to credit.
Germany is the other extreme though. Not sure if that is healthier.
The German model definitely has lower risks. If something goes wrong, there will still be something left with which you can rebuild.
The American high-risk model on the other hand is definitely one that isn't long-term sustainable, but it wins out in short term, until another crash happens.
I think especially in the last 30 years the risk has been shifted to lower incomes. To me that's the real evil.
German culture has a mass distortion on the perils of consumer credit. The "debt is evil" crowd is just an extreme as the people that irresponsibly use debt.
Maybe you should learn finance.
It's built to screw poor people. If the choice is between getting another credit card or losing your apartment you end up in a lot of debt.
I bet a lot of the credit card debt eventually gets written off. I heard a statistic a few years back 05/2014. Essentially 1/4 credit card debtors had more on credit then they had in the bank.
Those levels of debt are unsustainable on a macro level. Some bank somewhere won't get paid. Then we'll have 2008 all over again.
If you want to gamble on starting your own business it's amazing how much money you can easily borrow on credit cards.
Sounds on target. Anyone in the US can start a business based solely upon churning credit cards. For illustration purposes: Let's say you swipe at the start of the billing cycle, you now have about 60 days to repay. We will also assume that you have 10 acquaintances willing to swipe for you, each with a credit line of 80k, you suddenly got 800k credit to start. The more being spent, the higher the credit line offered by the banks. Add the incentive of credit card points/cash-back, and it's no wonder people are blinded by the risks of swiping. The end result? Small business owners will take heavy risks with an outsized amount of capital.
It's interesting that you identify ultra efficient hyper capitalism as the problem, then point the finger at Wall Street traders betting on mortgage backed securities. They really have nothing to do with each other.
To the extent you can blame anyone for ultra efficient hyper capitalism, blame programmers. It's programmers that allowed Uber to turn the inefficient and leisurely taxi industry into the Uber/Lyft rat race. It's programmers who develop the on-demand work scheduling algorithms at places like Wal-Mart. Programmers are the reason why Amazon can take over all the mom & pop stores, turning warehouse workers into appendages of machines. Programmers are the ones who enable international mega-corps to enjoy unlimited economies of scale.
No, those are all policy choices we made.
Policy choices that
- encouraged capital mobility
- tax advantaged capital vs labor
- gave an ever larger share of the national income to the ultra rich
- to not enforce regulations against allowing unlimited supply of taxi cabs.
- to subsidize walmart to the tune of $6.2B in 2013 
- to bail out banks and screw mortgage holders
- to allow banks to get so large they implicitly carry the backing of the US government and then turn around and go gambling, keeping all the profits and dumping the losses off onto you and me
- to allow Amazon not to charge tax and undercut local businesses for most of their history
- to subsidize amazon with the USPS 
I'm not saying any of these are necessarily right or wrong, but they weren't programmers. They were choices we as a society made via our representatives.
> Policy choices that
> - encouraged capital mobility
This part, right here, is what drives me absolutely crazy and why, for all of its faults, I love the European Union.
I have no problem competing against someone else anywhere in the world to see who can do my job better, faster, or cheaper. The difficulty? I am unable to follow "my" job anywhere it is being done but the money to pay me sure as shit can be sent anywhere on the planet to pay six other people.
This is why I get a little nationalist when it comes to jobs, manufacturing, and services...the thick black lines on the map make it the most prudent course for me. If my employer says "Seattle is too expensive, we're packing up operations and moving your job to Cleveland," I'm legally allowed to work in Cleveland if I so choose. But if my employer says "Seattle is too expensive, we're packing up operations and moving your job to [choose your own city outside of the United States, Canada, or Mexico]," it is difficult or impossible for me to follow.
It pisses me off that money or goods get to be treated differently than the people who actually produce them.
>No, those are all policy choices we made.
Who is "we"?
I doubt it. I certainly don't recall being asked, and I'm in a privileged position, relatively speaking.
I'd be curious to see how I could participate in the current environment.
> I certainly don't recall being asked
I (and you) have been asked when had an opportunity to vote. Have been asked when did not call my representative to make him/her accountable for their particular vote for a policy. Even when I have never tried to get elected.
> I'd be curious to see how I could participate in the current environment.
It's the political process. Although many tech people I've met seem allergic to doing anything that seems like 'politics'.
> To the extent you can blame anyone for ultra efficient hyper capitalism, blame programmers.
This is as ridiculous as blaming serfs for the feudal system. You're conflating a symptom with the root cause.
I agree with you but I would say that programmers are not the problem but are the "technical" part of it..
Without programmers, businesses still have the gamut of other control and efficiency professionals at their disposal -- mathematicians, statisticians, business psychologists, lawyers, accountants, and so on.
Workers have been squeezed for all time, with or without programmers.
But bosted through the scaleability of technology and optimized by programmers.
No I just contrast them.
One group is subjected to ultra efficient capitalism.
Another group can benefit from a myriad of complex tax breaks, government deals, revolving door relationships between legislation and business, ZIRP, NIRP and when things get really dangerous for them: outright bailouts.
Not all mega-corps depend on all of these unfair perks. I actually have a rather positive view of SV and the tech sector. They derived huge benefits from ultra loose monetary policy over the last few years (Amazon included), but they also do some genuinely great stuff.
That's why I said it goes way beyond the tech bubble.
You speak as if customers do not also enjoy lower prices, faster delivery, lower fares, wider choices, etc. All this is also enabled by the very same platforms.
I didn't say otherwise. I like paying $10 for an Uber ride from someone scared I'll give them a bad rating, instead $15 from a surly, unaccountable cab driver. I'm just pointing out that if you think that's a problem, blame the people responsible for it.
Who do you think is responsible for low prices?
The idea that responsibility is conserved is a fallacy. In the case where a system which had lots of failsafes fails, all of the failsafes are wholely responsible for the failure
Really? I much prefer the cab. I'll always take honest surliness over false suckuppery. Especially when most of the time what I actually get is honest friendliness.
This isn't necessarily about efficiency, or economics, but rather more about power, and influence. It seems that technology has so far acted as a consolidator of power rather than a distributor of one, even though it has fundamentally changed the economics of many things by making tasks more efficient. Technology has yet to affect change in the fundamental ways we govern ourselves, and control our economics. So the problem isn't economics, but who controls it, and who profits from it.
Customers also enjoy cigarettes. Which kill them.
The Information Age revolution has empowered and freed us countless ways. But it has also freed us to make bad choices. And it has empowered us to do far more damage to ourselves, our civilization, and our home than ever before.
And at the same time, we live in in world where the mechanisms of our existence - shaped by evolution and civilization are less suited to dealing with that ever before.
I'm confident that we can figure out new strategies for dealing with the world we've created, but I'm unsure how much damage we will do to ourselves first.
I'm not sure I understand the conclusion you're trying to reach here. At first I thought your point was that lower prices are somehow bad for the consumer but you never expand on that point at all. The only coherent thesis I could get out of your comment was that consumers make decisions that are sometimes self destructive like the decision to smoke. But no one thinks cigarettes are good for them, I would still argue that people who desire cigarettes have a right to purchase them in the same way that I would defend people's right to purchase any number of digital services they might not actually need.
All at the expense of our future. Consumers are generally ignorant to what the real costs are.
Sure, your uber ride is $7 dollars but the person driving that is getting screwed.
When taxis were first introduced, there were no regulations on them. There was no training for taxi drivers, there was no guarantee your driver wouldn't scam you, or that they were even experienced drivers. There was no need for them to have insurance, so if your dubious-trustworthiness driver got in a crash in their unmaintained car, with you in it, who cares if you got hurt?
After people had enough of the unregulated/bootleg taxi industry, government introduced regulations - insurance, training requirements, maintenance, which all drove up the cost of taxi service, of course. In a reputation-free unregulated market, corner-cutting is a great profit-optimization solution, but people generally don't want to bear the cost of systems that cheat them, or expose them to sky's-the-limit risk, so that plenty of drivers gambled with their customers' lives by not wasting time on silly things like repairs, insurance, a license. Unregulated taxi service harmed a lot of people. So there is a lot to consider about Uber being an unregulated equivalent, particularly as related to its profitability.
Uber doesn't profit because the preexisting taxi system was bloated with waste or laziness. Uber's business model works by providing consumers with amateur service, and driving down workers' compensation with particularly precarious contracts. They offload the cost of fleet maintenance and even fuel to their contractors. On top of it all, their funding goes not towards enhancing their quality standard of service, but towards sabotaging self-sustaining, "skin-in-the-game" established taxi services to lower their quality by having to cutting their prices, compared to Uber's predatory pricing. It's not about having a trillion dollar, Millenium Prize-worthy, NP-hard route optimization algorithm that cabbies could never comprehend. It's not about how a ~sharing economy~ shatters the paradigm by revealing new low-hanging fruit improvements to maximizing the flow of queued operations.
At a basic level, people give the same parameters to Uber they would for a cab: start location, end location, pickup time, and payment. Nowadays Uber drivers and taxi drivers alike both use the same GPS apps to plan routes on the fly. The automated aspect of Uber's taxi service is mostly the means through which the customer is interacted with -- app textbox UI elements versus phone message, billing to credit card via the internet vs a point-of-sale terminal, drivers turning down potential customers at their discretion via app or in-person.. -- and not so much "how the sausage is made" behind the scenes.
The secret to Uber's money? It's about spending as little as possible as it takes to make contractors pay out of pocket for the costliest parts of the business -- sustaining contractors and the resources required for driving others around -- while at the same time getting the contractors to provide the business's lifeblood and value themselves at a fraction of what it's worth. Presented as a "side-hustle", Uber pitches you the idea that you should accept low wages (and no benefits) for an exclusive chance to buy into a gamified battle royale, for scraps, in Uber's proprietary arena. Drivers are at the mercy of a stringently unforgiving rating system, where one single four star review takes twenty five star reviews to repair the damage done to their reputation. And if they do slip under four stars, they get suspended. Oh, and did I mention that all the while they bear the cost of upkeep, fuel, etc.?
Uber doesn't prioritize allocation of profits, ad infinitum, into more programmers; it would never make money that way! The programmers at Uber are no more responsible for the profit-creating decisions in the unregulated grey area it relies upon than the engineers who built the first factories were responsible for the decisions made by factory owners. "Child labor costs less" and "if you won't work 12 hour shifts someone else will" were both common justifications for ways corporations benefited from abject conditions to the detriment of society. Today still it is common for capitalists to publicly laud democracy as their most cherished ideal of managing the nation, while simultaneously enforcing policies that deny contributing workers from contributing to decisions about their contributions at all.
Offloading unavoidable costs as externalities paid for by someone else (specifically, Uber contractors) is the number one capitalist strategy for increasing profit, and really has nothing to do with Uber's technology or programmers at all - it's not like the programmers can create new technology that reduces further how much they pay their drivers without going below the operational costs for retaining their an employee-supplied fleet, or technology that can take more money from customers' hands than they pay for. At best, the centralized system they have interferes little with individual transactions, encourages carpooling, and updates driver availability in realtime (while collecting a lot of valuable consumer patterns, of course). At worst, it penalizes drivers for simple gestures such as giving a customer a couple of minutes to use the restroom, instructing the driver to move on to the next customer. Uber also used to do fake ride DoS attacks against Lyft, by requesting rides from remote locations before canceling them half-way there.
Uber is efficient in a way that BF Skinner and Eddie Bernays might approve of, but would to many others just look like not remembering the lessons of history. Uber is but an old scam with a new face. I can't see their existence continuing for more than, say, two years without serious revamping - afaik they aren't even profitable yet in the first place, they just live off borrowed money atm.
And ditto re: worker abuse for Wal-Mart and Amazon, and ditto re: anti-competitive salted earth policy tendencies towards smaller players. The engineering programmers don't even participate in the decisions to move around cost burdens in business strategies - the closest they get to calling the shots on spending, is when they're coding the revised implementation of whatever sleek new approach upper management wants ready to present at next year's shareholder's meeting. Better make 'em look good!
[ninja-edit: eeeek! apologies for the W-o-T]
Would you blame the steelworker for forging the chains that bind the slaves or would you blame the system that gave rise to slavery in the first place. Having said that, without willing participants the chains don't get forged. Problem is, if you don't someone else will and then they have a half-decent paying job and you don't.
> blame programmers
Programmers are not making the decisions on how to operate. You're thinking about the businesses who attempt to cut their expense and make huge demands on their workforce, taxes, and on the market themselves.
It is like calling your gun a killer when you pull the trigger. Blame the bosses of the programmers. We just try to make a living like everybody else.
Well, programmers have agency. Guns don't. If they did, sure enough I'd blame them for "being killers" in addition to blaming whoever commanded them.
For completeness, calling something a "killer" has several connotations. One is in the very literal sense by which I call a "screwdriving tool" a "screwdriver". This is technically correct and probably not what you mean. Another connotation involves blame, and you simply can't apply this to an object without agency.
(I'm still not pro-gun, btw. I just agree that calling it a killer is not a very convincing argument on the matter)
(Nor do guns "make a living like everybody else" :) )
My point is, if your boss commands you to do something unethical, this does not dissolve you of blame (unless you are an inanimate object :p).
There are strong and opposite forces at work.
Hyper-capitalism in the form of efficiency gains made possible by software-driven matching algorithms in markets that, when productivity is higher, don't need/warrant these efficiency gains. Such as the formalized platforms for the micro sharing of cars (Uber), personal living spaces (Airbnb), and labor (TaskRabbit, Mechanical Turk, Fiverr, etc.). We currently do more efficiency-shaving than actual new product building, so programmers are in high demand, but programmers aren't to blame. It's just business.
Then there's the hyper-socialism of government-back asset purchases in response to the 2008 financial crisis. For example the $700B in Troubled Asset Relief Program (TARP) funds were used to purchase equity in financial institutions and other important institutions, giving the government part-ownership of major banks, insurance companies, auto manufacturers, etc. - recapitalizing them so they could begin to shed toxic assets. Thankfully TARP is closed out and the government got paid back, with interest, so we closed the book on mass government ownership of private assets back in 2014.
Technically, the biggest boost to the economy - $4.5T of mortgage-backed securities, bonds, and assets by the Federal Reserve's 3 waves of QE - shouldn't be considered socialism, because the Federal Reserve is an independent, non-government entity. 
But it certainly feels like hyper-socialism because it undermines of the organizing principle of a democratic society - citizens should have both the right and the duty to elect officials to act on their behalf, and hold them accountable. Especially in such an important organization as a central bank, which basically plans and attempts to control major economic variables such as the rates of inflation and unemployment.
In the end, I believe that the governors of the Fed made the right call to bail out banks through lowering the FFR and engaging in QE. It probably saved many people's lives, without exaggeration.
Who knows what the hell the public would have voted for if they had direct representation in the Federal Reserve. If people voted for change over stability, many would have ended up shooting themselves in the feet. Ala Trump trying to remove healthcare subsidies for many of his voters.
But TARP and QE also set a terrible precedent. The bailouts undermined the idea/feeling of "economic freedom" that is probably the central and most powerful idea the United States of America has going for it. No taxation without representation? What about no bailouts without representation?
 Creation chartered by Congress, with the president appointing governors, but with monetary policy decisions taking effect without the approval of Congress or the Executive branch, does not receive funding from Congress, governors' terms span multiple presidential/congressional terms.
> the Federal Reserve is an independent, non-government entity.
Its a self-funded government entity created by law.
> But it certainly feels like hyper-socialism because it undermines of the organizing principle of a democratic society - citizens should have both the right and the duty to elect officials to act on their behalf, and hold them accountable.
Like many government entities, it's officials are appointed by elected officials and powers and priorities are set by elected officials through law; this in no way subverts accountability.
I respect your comments and breadth of knowledge, but wish you would take things a bit less literally and argue/reason at a higher level. I noted all of your points in the comment's  footnote - I'm aware of the technicalities, but am making a broader argument. But don't just take it from me, here's an ex-president of the Minneapolis Fed making the same point: https://www.bloomberg.com/view/articles/2017-08-07/maybe-cen...
Do you feel like you are adequately represented in government, and that you can trust elected officials to appoint staff those who will make decisions in the best interest of you, your family, your city, state, nation, etc.?
> Do you feel like you are adequately represented in government, and that you can trust elected officials to appoint staff those who will make decisions in the best interest of you, your family, your city, state, nation, etc.?
No, but (as my comment history shows) that's because we have what is empirically shown to be a very poor electoral system (among those used in modern democracies), not because officers of the central bank are appointed rather than elected.
Do you guys think, maybe a capitalist, but more social system will be more maintainable long term? Similar like in Sweden or in Finnland? As I know these modern countries reallocate some part of extreme revenue to other part of the society who in needs and the whole population is more equal.
Not sure, the final word on Sweden is not out yet.
Also, (imho) the problem is not some people making more money than others. The problem is that the grim reaper of capitalism is still hard at work for regular working people, but has been quite absent at crucial points in time when it comes to certain big capitalists.
Wrestling mom & pop into submission and taking over their land is less hard if you don't really have to worry about mundane things like being profitable, paying taxes, complex legislation, risk consciousness in investors, personal liability, mark to market accounting or making sure your constructions are capable of surviving some slight financial turbulence.
Sweden is smaller than the US, and plays a different role in the world. I don't think the same systems are apt.
Join this to the hedonism and nihilism of post-war generations and you have the Steve Bannon's Generation Zero documentary.
You've clearly articulated an ideal I've felt for over a year but couldn't convey completely. Thank you!
Working class people are being subjected to ultra efficient hypercapitalism, as in Uber drivers discovering they worked for free when they need to purchase a new car.
Meanwhile Wall Street has been bailed out 2 times in the last 15 years alone with monetary policy. How many people went to jail? (And they haven’t learned a thing, on the contrary and quite spectacularly so.)
If you want to know where the tech bubble comes from, don’t think about the talent pool in SV.
Think 2008 and central banks. It's not normal for investors to accept visionaries wasting endless billions for years on end. Except when the availability of capital appears infinite and risk appears almost non-existent.
In contrast, a big group of people stagnate and even get squeezed. Not rich enough to enjoy the high life of the zero/negative yield world. Or to overcome decades of inflation. Not poor enough to just give up and go on food stamps.
Ultimately, it’s not about a tech bubble. It’s about a credit cycle on steroids, held together with spit, rope and gum and massive moral hazard. Who gets access to the funny money first? And who will be left holding the bag?
It's really not easy to uproot and move from an economically depressed area to an active metropolis. I've done it (Athens, GA to San Francisco in late 2012) and it was incredibly expensive and involved a large amount of personal credit use, cash assistance from family, and time. It was a huge stretch at the time for me to move across the country and break into a new industry, and I did it as a single man, willing and able to sleep on couches and occasionally a cheap hotel room (which left me going to the next job interview itching with flea bites). I spent a lot of days scrambling to figure out where I was sleeping that night while I navigated the terribly tight housing market in San Francisco. I would have never been able to do that with any sort of family.
If you are coming from a town where $28,000 is a really good salary for a job and your rent (as a single person with roommates) might be $250-$300 a month, how on earth do you save up enough to get two months rent in SF or even Oakland? Especially considering how little savings most families have in America, and that's when you haven't been laid off.
When you have certain highly fungible skills moving around is relatively easy. Now that I'm a programmer I can theoretically get a job in pretty much any American city I choose, and probably negotiate a starting/moving bonus so I'm not out-of-pocket for any costs associated with moving. That's true for all of my former coworkers and a lot of my friends out here in California, so I think it's easy to forget how abnormal that is.
What I don't understand is why people don't use the time they have in the low cost-of-living area to develop the skills (via the Internet) that would make them attractive to employers in big cities? That was my approach - I lived at home with my parents after graduation, basically did nothing but program (both for work and after work), and after 3 years Google came knocking and paid for my move out to Silicon Valley. This is fairly common among tech companies, or even any sort of wealthy corporation - if they want someone remote and the person is willing to relocate, they'll pay for the move.
I have several friends here with similar stories - they're from even more economically depressed areas (Alabama, Tennessee, Indiana, Cleveland, etc.), but spent their free time coding, and then Google came calling.
Honest question here - what's going through peoples' heads when they decide that reading Breitbart or watching TV is a better use of their time than developing the skills that will make them desirable to those evil corporations that are making all the money?
I believe you have a survivor's bias here – I have kind of the same track, I developed my initial skills while living with parents, being single and without having too much social interactions, so I was able to dedicate incredible amount of time to all this stuff.
But this is not always the case. Very often when you realize that you need to change something, you already work, and you have some obligations, so you have to keep up your work no matter what, and you might have not that much of energy in the evenings. Also, relationships can take a lot of energy from you as well, or you might just (surprise!) have another hobby, and you don't want to sacrifice it.
So, that's all can be broken as "not enough motivated", but seriously, does everybody want to change their life to become a top programmer?
And this is even without mentioning that not everybody can develop skills (and create good-enough self branding to present it) to be able to be hired by Google, or other big corps, which will pay for your relocation.
The last point I want to say that it is very hard to develop yourself without understanding how -- a lot of people don't read HN, they think that people working in Google, FB, etc are some semigods, and people around them seem to agree about that -- it is like another bubble, where nobody knows how to actually get into this SV one.
You may be right - I think about what I'd need to do to switch careers now, at 36, and it's a lot harder than when I was 19. Luckily I have a bit of a cushion, which was built up over those years as a computer programmer, so I wouldn't go homeless or anything while retraining. Many other people are not so lucky.
I wonder what sort of education would be necessary to bring that opportunity to everyone, though. I was lucky first of all in that my high school really stressed learning to think for yourself and make your own choices, and second that I got an education in basic economics (supply & demand, compound interest, savings, and prices) from my dad at an early age. Most people don't get that. Maybe personal finance and a basic introduction to how the economy functions should be a required course in public education, though it's probably not in the interests of the people who set the curriculum to have a population that can think for themselves and look out for their own interests.
Let's say everybody got the necessary education to follow your path. Can Silicon Valley absorb the 27 million unemployed or underemployed workers in the US?
I think this idea (not just you, it's been expressed by many on this thread) that it must be Silicon Valley or Google specifically that absorbs the 27 million unemployed or underemployed workers shows a remarkable lack of imagination.
What's likely to happen isn't that Google hires 27 million people. It's that Google hires 10,000 people, who learn the details of the new methods of production required in the information age. Some of those will quit (even though Google doesn't want them to) and found new businesses. Some of them will even leave Silicon Valley and go back to their hometowns or other cheaper areas, and bring the knowledge & culture back with them. They'll then hire other people, who will learn the skills & culture needed to thrive in the information age, and so on, until it's disseminated widely throughout society.
Instead of everyone moving to California, California will move to everyone.
My bewilderment is mostly at this avoidance of economic rationality. To me, the market is sending a very clear signal that certain ways of doing things - those that involve computers, and replacing human labor with them - are more efficient than the old ways of doing things, and that's why people who adopt them make lots of money. The logical thing to do is to adopt them too. Lots of people are not doing that, and assume that there must be something mystical or corrupt about how Silicon Valley makes its money.
I get your bewilderment, I'm just wondering if it's not a red herring in a discussion over the problems of the overall US society. I'm not convinced that even if the market for programmers (even accounting for more local companies and such) was flooded until the average wage dropped 50%, that it would make a significant dent in that number, which is likely to grow.
It doesn't really need to. That tremendous increase in supply would push wages to minimum wage. When devs are making minimum wage, they won't be in the bubble anymore.
Depends, of course, how fast demand grows.
If it grows like that, that simply means the answer to the parent's question is yes.
If any industry would like to absorb the 27 million underemployed or unemployed, then they could if they were willing to invest in training them... versus offloading to upstream providers like schools. Of course, you could instate a hybrid approach between company training and traditional schooling as well. And it'd be a smart idea!
My question has always been: why aren't companies doing this?
We're talking multi-year (1-3 years) investment in training. Why not?
Seems crazy, but it's not so crazy if companies would:
1. Provide clear training milestones of accomplishment (tied to compensation advancement)
2. Support trainee with necessary personnel and materials
3. Backload compensation
Think about it, the company starts you out at say $8/hr. Then for each progressive level you ratchet up to $10, $12, $15, $18, $22, $26, etc. This ratcheting can happen as quickly as the trainee progresses -- no set time limits.
The beauty is that this provides ample motivation; it's easy for a candidate to see how they can achieve success. It also reduces the company's risk, should either side determine the relationship isn't a good fit; the company will have minimized their financial outlay.
I understand that most startups can't do this (unless it's an explicit part of their plan), but I don't understand why larger cash-rich corporations don't do this. It seems like there's massive untapped potential out there.
Don't we believe Google would be able to take a sufficiently motivated individual and turn them into a world-class engineer after 3 years, at the most, of focused training? I think the odds in favor are far greater than 50-50. I mean, who would turn down a job at Google starting at $8/hr with the chance to rocket up to $50/hr (ignoring wage depression as supply increases).
So why hasn't Google tested this? How much do they spend on trying to find the "best" instead of creating them... that's a question I wish I had the answer to.
Work remote and live in a cheap area maybe.
Basic Civics, Finance & Economy should definitely be required courses in HS. When I talk to older people they generally tell me they had these classes, and are surprised they're no longer commonly taught. It's almost as if, by design?
IMO a lot of people were misled by marketing i.e "get a college degree, everything will be fine". The advance of technology (amongst other things) has majorly disrupted that model. I'm not an economist but the rest of the world has gotten more competitive as well, beyond just manufacturing. The U.S public K-12 education system is a major long-term liability IMO.
To your point about teaching yourself skills and getting hired - good on you that you did this but it's extremely difficult - the average person couldn't do this. That's even assuming that they saw out of their bubble and became aware that this was an option, which isn't as obvious as it might seem.
Also, not everyone has the ability nor desire to be a programmer - which is one of the few jobs I observed where if you have the skills, you have A LOT of leverage.
"That was my approach - I lived at home with my parents after graduation"
There's your answer: not everyone can, or wants, to do that. People have families, kids, second jobs already (to pay the bills they need to pay right now, or else bad consequences), maybe don't get on with their parents that well, or have absent parents, and are generally time poor.
Google doesn't come calling for everyone: not everyone has the aptitude, not everyone is smart enough no matter how hard they work. That might suck, but it's unfortunately true.
Or at least so I'd thought: the fact that you were apparently smart enough to get a job at Google yet still managed to overlook these fundamentals may have sown a few seeds of doubt in my mind.
Working on skills when young, or in off hours after a job, is a way to get better and land a job outside of whatever you're currently doing. Not saying it's easy by any means, though - and in some cases is quite near impossible if you must work two jobs just to keep the lights on.
I hope remote working spreads the well-paying jobs around more, so people in low-opportunity places no longer are limited to those few opportunities. They can bring in money from other places to their local community and help economic activity, even f it's simply having enough money to eat out more, go to the community theater, etc.
A lot of survivor bias among you and your friend group I would think. I did code in all my free time back in Georgia but I had no CS degree and I had never held a programming job. There were a lot of things that I didn't know I didn't know, as I soon learned when I showed up in SF.
I have a lot of friends and contacts back in the Atlanta area that are doing just what you described . . . and they will continue doing just what you described . . . and it will not lead to a job at Google or any West Coast tech company. Reading HN and messing around with your GitHub is one thing, but there are a ton of people who are talented but have no idea what employers out here are actually looking for, or how to focus on those skills or showcase them if they already have them. That's just within programmers, which is one of the best markets right now. If you are a skilled lathe operator what are you going to do, learn to code?
I'd like to think everyone could learn to code because it would mean I wouldn't have to consider the economic sorting going on, that I benefit from, and how a great many people are stuck on the other side of it. If everyone could learn how to code I not only can pat myself on the back for doing so and bettering my life, but I can also avoid having to empathize so much with people who never will and are in worsening economic straits because of it.
What other skills can you develop via the internet that make you appealing to employers in big cities?
> What other skills can you develop via the internet that make you appealing to employers in big cities?
Sales, digital marketing, community management, UX, and data science are some examples. Known "influencers" in online forums, for example, often get hired for digital marketing, because they have real-world on-the-ground experience that big corporations that lack (for an infamous example, see Saydrah on Reddit). If you can get a video to go viral on YouTube, you're often qualified for many marketing jobs; I had an English-major friend get a job at a startup (albeit a terrible one) for a rant he made on YouTube that went viral. Independent researchers who can come up with an interesting & rigorous blog post based on publicly-available data often get data science job offers. Redesign a major product and convince a significant number of people that your version is better (this is non-trivial) and oftentimes you'll get a job as a UX designer or PM for that product.
If you are a skilled lathe operator, but the only jobs near where you want to / need to live are coding jobs... yes, learn to program.
Just like if you were a blacksmith but nobody was riding horses much anymore, it's time to learn a new craft. It's not easy, but it's necessary.
Having programs to help with that is something that, I think, government can help out with some, especially if government policies are moving the jobs away from lathe operators/blacksmithers.
A fundamental understanding that not everyone can get positions at those companies because those companies will always take the top 30% (or whatever) of people with skills they desire.
If everyone decides to take your approach companies will simply become more selective, not employ more people than they need too, no matter how good they are.
Not just the top X%, but the top X% living within commuting distance.
There may be some interest in relocating specific highly desirable individuals, but they will already be industry insiders.
Industry outsiders will not get relocation benefits.
The problem is that jobs have been offshored to increase profits.
You really have to think about this to understand it. The Harvard Business Economy has made it impossible for most people with average skills and abilities to find work that pays a living wage that makes essentials - not luxuries, but essentials like housing, food, and transport - reliably affordable.
Developers have top X% skills and see a very skewed economy where their services are relatively in demand.
Most people see a very different economy, which has left them behind with no prospects and no safety net.
Historically, this rarely ends well.
> There may be some interest in relocating specific highly desirable individuals, but they will already be industry insiders.
That is not in any way my experience. For most companies willing to do relocation (including almost any good tech company), the interview bar is the same regardless of your current location. If they decide to hire you, they'll pay for your relation—especially since it's a blip compared to your total comp as a developer.
That has been my experience too. There's a discontinuity along national borders, since green cards are a huge pain the in the regulatory ass, but when I've been interviewing for major tech companies nobody has mentioned within-US relocation expenses. They're too small to bother with, a few thousand bucks at most. Basically peanuts.
(Full disclosure: I went to college in a place so boring that you had to go by the cows and the horses to get to class. I got hired to an unrealistically amazing job via Skype. There was no in-between. It was a big surprise.)
> I don't understand is why people don't use the time they have in the low cost-of-living area to develop the skills (via the Internet)
I have thought about this question for a long time and I have observed people for a long time and I can sum it up with this phrase "You can't teach an old dog new tricks."
I have heard so many people (with or without jobs) that they cannot learn new skills now and then I shout in my mind that if you are not willing to learn new skills why should an employer hire you, of course I cannot say that to their face because I have to be polite.
Google employs ~70k people (https://www.statista.com/statistics/273744/number-of-full-ti...)
That puts you as 70k in 300M ~= the top 0.025% of people.
Can tens of millions make their future plans "become smart and capable enough to be in the top 0.025% within 3 years"?
That assumes an ordered ranking of people and of employers, a premise I reject.
Google is one of several thousand employers that are both hiring and pay reasonably well. Most of the other ones will also fly you out and pay for relocation if they want you. At the same time I was interviewing with Google, there was even a 3-person startup that was willing to fly me out to SF to interview, except that I didn't really care about their business. If you don't get into Google, there's still Facebook, Amazon, Microsoft, Apple, Stripe, AirBnB, Square, Twitter, Netflix, Tesla, Lyft, Dropbox, Cisco, Intel, Juniper, NVidia, EBay, Hewlett Packard, IBM, Ericsson, JP Morgan Chase, and many other companies. Most of those are perfectly acceptable employers; they may not have the prestige of Google, but you can make a good living and possibly even end up wealthier than at Google.
I don't think the parent assumes an "ordered ranking of people and of employers" as much as it assumes a limited supply of open positions that meet the criteria you're giving (i.e., employers that will pay to fly you out for interviews and pay your relocation expenses if they hire you). The Bureau of Labor Statistics gives June 2017 numbers for employment in the "Information" category as 76,300 in the San Jose-Sunnyvale-Santa Clara area and 102,400 in the San Francisco-Oakland-Hayward area (and another ~4000 if you throw in Napa, Santa Rosa and Santa Cruz). Even if we assume that all of those positions meet your criteria, and assume that there's a huge number of unfilled positions--say, 25% more than the filled ones--we're at around 250,000 total. And in practice, the first assumption there is, well, suspect. (There are technical writers, helpdesk support people, and entry level programmers at companies that won't pay relocation at that level.)
Bottom line: only a small fraction of people can get jobs in the tech industry, because even at its tremendous growth rate it's only creating enough jobs for a small fraction of the population. Increasing the pool of qualified applicants doesn't change that, it just makes the competition for the existing jobs harder.
> Google is one of several thousand employers that are both hiring and pay reasonably well.
I lived in Dallas for almost fifteen years. The vast majority of those companies ignored me even when I applied. Many of those same companies are now starting to beat my door down because I changed my location to New York. This industry seems to have a serious problem with geographic myopia.
Just from your list, Facebook ignored me until I moved to New York, Intel ignored me, nVidia ignored me, IBM ignored me, Microsoft basically ignored me. The only companies that approached me or responded to my applications were Google and Amazon, and only Amazon has been persistent.
Same here despite listing that I was willing to relocate on my own dime. Then I relocated took a job at Apple and every big name wanted to interview me. Got job offers at two other big tech names while I was in CA. until I worked in the valley I apparently wasn't smart enough despite 20 plus years experience outside CA.
there is a bias. it is real and speaks badly of the valley.
Did you indicate a willingness to relocate in your application? I was in Boston when I applied to Google etc, but had on my website, my resume, and my cover letter (when applicable) "Looking to move to Silicon Valley."
I mean I work at Google now, but when I was applying to move out west, my experience almost exactly mirrored GP's. Only Amazon responded to my resume. There is an awful lot of luck involved at landing a high paying job still.
"Now that I'm a programmer I can theoretically get a job in pretty much any American city I choose, and probably negotiate a starting/moving bonus"
Try getting a job in Athens Georgia with equal or greater salary than you are earning now in SF
I don't know where those downvotes are coming from: you're very much on the money, here.
There is a major set of blinders techies in the big centers have with respect to how good the market is...anywhere else. It might be easy to walk across the street and land another $120k/year (low for SF, but still respectable enough especially for a single person) job in one of these markets and be doing something a bit more interesting than simple CRUD, but not elsewhere.
The fact is most technology jobs outside these hotspots pay poorly (usually not more than a small premium over other professions in the area) and are just not common anyway. They also are much closer to "grunt worker on the line" than "build your resume by being able to work with lots of technologies". A typical software developer job isn't at a software company in these places. It's in the IT Department as a low-class cost-center line item, working on basic CRUD with little or no say in the infrastructure or even product development, or else a fixed specification project in which you're more or less tinkering around the edges of a pre-existing system.
Not true. You can probably get a job most anyplace that actually has employers who need programmers, but you'll find starting bonus and moving expenses are limited to major tech areas and employers. Where I live there's a university that employs a lot of tech folks, and several private tech companies, but nobody pays for relocation, and salaries are $50K - $100K or maybe a little more at the very top end.
A good real-estate agent makes way more money than a programmer in many areas of the US.
Not to mention a good accountant, good lawyer, decent optometrist, decent dentist, decent doctor.
Not only do lots of those jobs pay better than tech jobs in most places you can also live more easily in cheap, nice places where a nice house can be had for less than 300K.
And their jobs are much, much harder to offshore.
It's interesting how there is this great push to get people to code, pushed by politicians who are almost all lawyers.
You don't see a push for more lawyers or doctors to drop costs. They don't import H1Bs. Try getting a medical or legal licence from another country.
It's not easy outside Bay Area Bubbles or concentrated zones to find the programming jobs that you really would like and grow in.
Oh I agree, I couldn't get anywhere near the salary, but if I wanted to find a programming job back home in Athens I could swing it. I would probably have to learn COBOL though, no joke.
And I'm in Santa Monica now, and my salary has been $0 for the last several months! Will finally be able to run payroll for myself next month though so that's exciting.
>That last part bothers me a lot. It seems a lot of people just don't want to move. Anecdotally I've moved nearly 6 times in the last 8 years. My parents have done the same.
How do we build any kind of community with so little permanence? If we can't bond with our neighbors, we become these empty, atomized husks floating from one economic opportunity to another.
Put another way, how can a village raise a child if there's no village, no permanent-ness, and eventually none of the social accountability that communities enforce?
Non-centralized churches are interesting. They are institutions that generally rely on community funding. They have the potential to easily last beyond any one person's lifespan, hopefully many generations. They are places where people meet not only for religious purposes, but also to gather, chat, and eat.
They are places where new parents trade knowledge and assistance. They are places where young people contribute their physical labor and tutoring abilities. Some churches directly provide daycare and tutoring services. Religious leaders often take on many hats, one of which is counselor to young people.
But how do you create churches without religious glue?
Or, how about even more basically, how do you convince people that it's worth building more publicly funded community meeting spaces for young and old, such as parks?
That would be a valid complaint if grand parent was arguing that we should move every six weeks, but here the argument might be that we should move every dozen years or so -- which should be plenty of time to figure out if your neighbours are worth keeping around as permenant friends or were just aquentences of accident.
> if your neighbours are worth keeping around as permenant friends
Social bonding =/= friends
In fact, social cohesiveness requires being able to maintain relationships with people who aren't your friends, and who you didn't choose.
No organization that lasts long relies on 'friendship'.
Isn't that what Facebook and the like are for? I'm being serious here.
Since 2002 I have moved 5 times for work: Colorado, Texas, Guam, Maryland and now I'm in Virginia. My family is spread around Texas.
I mostly keep up with the people I made friends with through the years and my family on FB, Twitter etc...phone and then rarely on email.
The idea of a "local" community you have your whole life is antiquated - if it ever really made sense. Humans were traditionally nomadic - albeit in the same group. With the historically recent invention of agriculture, that stopped and we started staying put. I think remote work and technology means we can probably stay put more, but there is also a return to the nomadic work need, as employers seem to like to have workers on premises.
Bottom line, your village will change over time.
> Humans were traditionally nomadic - albeit in the same group.
The same group is the important bit. The parent is talking about the importance of community. I don't think they care which kind it is.
One of my early jobs had me bouncing around the country. Every time I moved I had to start all over from scratch. Where's the grocery store? Where do I meet people? Is the church or the bowling ally the place to be on Friday night around here?
It got old. I love exploring new places, but I want to know my way around where I live. Travel is different from endless relocation.
>Your village is a hypercorp that sells all your social interactions for profit
This, to me, is a "Truman Show" level dystopia.
The common theme in dystopic stories is the protagonist's unraveling unawareness of just how bad things are. Enjoy!
The irony is that many classic dystopian stories are actually written about today, the time and place where they were written, and not about some hypothetical future. 1984 was based on Orwell's experiences as a propaganda writer for Britain in WW2. Animal Farm was about the Soviet Union.
Fahrenheit 451 was inspired by McCarthyism. Saruman's orcs and trollocs in Lord of the Rings were supposed to represent industry, the factories and smelters that were destroying the English countryside in the 30s. The Hunger Games was about the Iraq war and how we numb ourselves on reality TV.
If you believe Jared Diamond (and I think he at least has a point), the point where we entered dystopia was when we invented agriculture 10,000 years ago. That was when humans began to accumulate surpluses that they could use to lord over other humans, and men began to serve men (and women to serve men too). Humans have a remarkable ability to adapt, though. Most of us don't think of agriculture as an evil soul-crushing machine, even though it was the beginning of large-scale repression, because it's so ingrained in our experience of how we live.
Not just Jared Diamond. There's a whole school of thought (albeit very small and disrespected) built around the concept. From wiki:
>Anarcho-primitivism is an anarchist critique of the origins and progress of civilization. According to anarcho-primitivism, the shift from hunter-gatherer to agricultural subsistence gave rise to social stratification, coercion, alienation, and population growth.
...because otherwise most of us would be dead. Or would never have lived, which is the same thing, kind of.
If anything had been slightly different whole other sets of sperm would have fertilized the egg, so that's not such an impressive argument. Especially since all of us will be dead at some point, regardless. And funny how that "compassion" doesn't extend to the people crushed every day, the people shrieking in anguish as we speak.
The question isn't just how many people are "alive", but what life are they living. What would make someone seek power over others? Why has this defect been normalized?
Let's say even more abuse allows even more people to get squeezed on the planet. Big whoop? To me that's like overloading a truck to the point where it doesn't move one inch anymore, and not even seeing how counterproductive that is.
I'll just say it: one healthy person is worth more than an infinite number of clones of an alienated person. We can discuss "health" and how subjective that may be, but sheer number of people is worth nothing in my books, that's for sure.
> It's too late, Diana. There's nothing left in you that I can live with. You're one of Howard's humanoids. If I stay with you, I'll be destroyed. Like Howard Beale was destroyed. Like Laureen Hobbs was destroyed. Like everything you and the institution of television touch is destroyed. You're television incarnate, Diana: Indifferent to suffering; insensitive to joy. All of life is reduced to the common rubble of banality. War, murder, death are all the same to you as bottles of beer. And the daily business of life is a corrupt comedy. You even shatter the sensations of time and space into split seconds and instant replays. You're madness, Diana. Virulent madness. And everything you touch dies with you. But not me. Not as long as I can feel pleasure, and pain... and love.
I'm in rather strong agreement with your post. There seems to be some brand of, I don't know, utilitarianism? That decided that any life, no matter how wretched, is equal to any other life in the evaluation of how bad things are, when this just can't be correct.
> What would make someone seek power over others? Why has this defect been normalized?
This one, though, I would say comes from biology. Power imbalance is the name of the game of everything in nature. You can find it in monkeys, you can find it in simpler life forms.
At some point, we need to accept where all this garbage originally came from (which is also why it's so resilient and strong) and oppose it, assuming it won't eat us first.
> This one, though, I would say comes from biology.
Yes, and no. I see big dogs never barking, because they don't need to. I see little dogs always fretting.
I think the misunderstanding might be in the phrase "seeking power". I don't mean wanting to survive, or wanting to mate. Nobody wants to be "powerless", of course. We want to not be coerced, and then to have some additional "power" to do something. We also want to be acknowledged, and so on. But that's still mostly a give and take, a live and let live -- not "either I have power over you or you over me", I think that sort of binary situation has to be produced with a lot of pain and destruction, it's not the default. Maybe that's idealistic, but at least in the human realm I think that's more or less true.
I mean the kind of hole that goes waaaay beyond "power as in opposite of powerlessness", and that never gets filled. People like Hitler are of course the most extreme examples, but still useful I think: in one sense he was a powerful man, because others obeyed his commands (or distilled wishes from his rants). But actually he was incredibly weak, he couldn't stand up to any person no matter how small as himself, he needed his role as Führer, his self-pity, the admiration, all that. And all of that didn't compensate his original issues, it compounded them. He made no difference to his own weakness, he just murdered a lot of people and then killed himself. He started out unhappy and ended up unhappier, and wreaked only murder and destruction. Actually powerful, or so weak that he had to become "powerful"?
Let's say someone is very strong: if someone tries to rob them they might break off their arm, and yay for that, but hopefully they're not going around robbing old ladies and beating up little kids. Those who do we consider sick, and when I examine their lives we always find something. Something they lack and seek outside of themselves, never getting it.
I'm sure that drive also sometimes produces works of art and inventions but on the whole, I don't think we need this. We already have curiosity, we already have ribbing on each other or topping what others do. We have better means to make art and inventions. And we have empathy, which means we can make each other gifts because it makes us happy to make others happy and get all the progress, all the fancy schmancy tech even, without any of the atrocities. There is competition with sportsmanship, which there should and always will be, and there is this cutthroat madness and lack of empathy for others because people haven't even hold of themselves. The latter has engulfed the planet, while the former is belittled as something naive, which to me is projecting the stunted development greedy people have on those who are more grounded.
Yes, we can also see this in wilderness, but not just it. Take this:
> In a study appearing today in the journal PloS Biology (online at www.plosbiology.org), researchers describe the drastic temperamental and tonal shift that occurred in a troop of 62 baboons when its most belligerent members vanished from the scene. The victims were all dominant adult males that had been strong and snarly enough to fight with a neighboring baboon troop over the spoils at a tourist lodge garbage dump, and were exposed there to meat tainted with bovine tuberculosis, which soon killed them. Left behind in the troop, designated the Forest Troop, were the 50 percent of males that had been too subordinate to try dump brawling, as well as all the females and their young. With that change in demographics came a cultural swing toward pacifism, a relaxing of the usually parlous baboon hierarchy, and a willingness to use affection and mutual grooming rather than threats, swipes and bites to foster a patriotic spirit.
> Remarkably, the Forest Troop has maintained its genial style over two decades, even though the male survivors of the epidemic have since died or disappeared and been replaced by males from the outside. (As is the case for most primates, baboon females spend their lives in their natal home, while the males leave at puberty to seek their fortunes elsewhere.) The persistence of communal comity suggests that the resident baboons must somehow be instructing the immigrants in the unusual customs of the tribe.
> Dr. Sapolsky, who is renowned for his study of the physiology of stress, said that the Forest Troop baboons probably felt as good as they acted. Hormone samples from the monkeys showed far less evidence of stress in even the lowest-ranking individuals, when contrasted with baboons living in more rancorous societies.
Here's some video: https://www.youtube.com/watch?v=4Q-bB-qywJ0
(That guy also has a LOT of super interesting lectures)
I mean, we also know proteins can fold in a way and get others to fold the same that causes Alzheimer's (if I'm not mistaken). Is that useful for something? I don't know, I think sometimes shit just happens. Another thing you can find in nature is this https://www.thedodo.com/inspiring-animal-families-958705512....
Just a random kitschy link, and you might say that that's just because the instincts which are supposed to strictly serve "their own species" are just misfiring, or that they're just practicing their survival skills which doesn't hurt them in these situations. But I like to think that when the basic needs are met, when nobody is feeling threatened, even animals naturally develop all sorts of friendships. This matches what I see in daily life much more than the claim that life is war, and everybody has to be fighting or dying all the time. After all, the energy comes from the sun, and we can neither take it nor reject it, it's just there so we, life in general, used it. That is a much more fundamental basis of life on Earth IMHO.
Well, you have convinced me. We should immediately switch back to a pre-agricultural, nomadic, very low technological, hunter gatherer society. I nominate you as the first headman.
The change will, of course, result in the near immediate death of, say, half of the people currently alive, including me. You get to explain to them what is going on (extra points for ending your speech with a dismissive "But, well, there you are."), but you also get to choose who is a "healthy person" and who is a "clone of an alienated person".
Go for it!
Funny, staying in the dead-end town you were born in with your grandparents' knitting circle supervising your dating life is an even greater dystopia to me.
Exactly this. I was fortunate enough to stay in one place for K->12, but in the world I grew up in it was totally normal for young adults to move for college, then after college, then a few more times before settling down, then again for retirement. My parents did it, my grandparents did it (including as refugees when they were children), my aunts and uncles are all over.
Soon my parents will move for retirement, and my original "village" will hold nothing for me anymore. So it goes. I have a few friends from high school or college in basically every city, and we meet up when we happen to be in the same place. Family picks a place and all flies there for Christmas. It works out.
Mobility and a willingness to learn new skills in the context of an established citizen and family is entirely different from the context of an immigrant family in almost every case.
Moving is generally very expensive, and proportionally more so for those with lower incomes.
The "nomadic" lifestyle you mention actually isn't normal, even today.
This lacks context:
It's what other generations have done
Other generations had much higher real wages, and much less risk. During the 1930s and 1940s there was a huge movement of desperate farmers to California. But wages in California were good, and California went 50 years without a recession -- from the 1930s to the 1980s was one long continuous boom.
Going back further, consider the events described in Little House On The Prairie. Laura Ingalls Wilder's family faced ruin after locusts ate all the food that the family was growing. So her father went away for awhile and found work where he was paid $1 a day. And that was enough money to completely reboot their lives. Not only could he keep his whole family fed on that, he also had spare money to buy seed and thus plant a crop the next year.
High real wages are the reason why millions of people, including all 4 of my grand-parents, left Europe to come to the USA.
Male wages have been in decline since 1973. Family income increased till 1999 only because more women started to work. Family income has been in decline since 1999.
Movement and migration can not be be justified rationally in a world where wages are stagnant or falling.
For people who have lived in the same area for several years, moving means losing all of your political capital that you've built up in the form of:
* votes / campaigning for your representatives
* learning about the local laws and maybe even having voiced yourself at town halls to make real changes
* all bonds you've made in your community which helps when wanting to make a push for local changes
Moving means losing all of that. The only exceptions to this are the wealthy, famous, or well connected. So I can very well see why some older people wouldn't want to move.
If everyone started living like the parent suggests then it would just increase the power disparity between the wealthy and everyone else. Only those wealthy enough to afford a home and be insulated from the need to follow employment opportunities would have any say in even local politics anymore
I'm also convinced that a willingness to relocate plays a huge role in upward mobility. In the past decade I've moved eight times, not always for a new job, but always for new opportunities.
However, I do acknowledge that it's easy to say that as a young single person. Marriage and children make that a lot harder, but not impossible. I moved as a child a number of times. Maybe that's why I don't find it so hard to do as an adult?
>Mobility and a willingness to learn new skills seems to prevail. It's what other generations have done, millions of immigrants (my parents included).
For an individual this might be a solution (even for me! I've moved around lots too)
But for a whole society it's not. Especially when we seem to be hearing similar stories across thousands of towns and cities. Is everyone supposed to move to the bay area, NYC, Boston, Seatle? What is the housing going to look like? Does the rest of the country just empty itself?
The answer to your last paragraph, for the majority of people, is yes. That's how urbanization looks like. That's what the other generations have done. That's how it worked a hundred years ago, with a huge portion of people leaving countryside to relocate in urban centers, that's how it transformed China recently (uncountable millions of people moving from inland farming to their east coast manufacturing), that's how it's ongoing now, and that's how it's going to happen in the future.
The current world increasingly favors centralization and economies of scale, so the "optimal" spread of people gets more and more centralized. Living on the fringe,
unless there's a specific economic need (we'll still need some (1%? less in the long term) people living as on site farmers) is increasingly becoming an expensive "hobby"/lifestyle choice, since you're going to get less services at a much higher cost and with less opportunities for income.
"That's how it worked a hundred years ago, with a huge portion of people leaving countryside to relocate in urban centers, that's how it transformed China recently (uncountable millions of people moving from inland farming to their east coast manufacturing),..."
There is the minor difference of moving from one location to take up relatively lucrative, but largely unskilled, jobs and moving from one location with a low-skilled job to try to find a high-skilled job. Or even from one high-skilled job to a completely different high-skilled job.
...less services at a much higher cost...
While the "less services" part is sometimes true, in semi-rural/sparse suburban areas it's often possible to get quite a bit more for a lot less. Car maintenance, food, land, recreation, all much cheaper outside of the major urban areas and high-cost states. This is yet another obstacle people face when trying to move to a big city. They can't afford to pay twice the price for half the food.
This may depend on the location, but for me the pattern is that services are much cheaper in the rural areas (including e.g. eating out) but goods are more expensive, including food - e.g. bread and butter will be noticeably more expensive in the rural small store than in a large town megastore. So if you're wealthy and consume lots of services of others, then that's a nice place to live; but if you're poor and would rather do everything yourself, then the basic necessities (except rent) are more expensive. Getting your oil changed is cheaper than in the big city, but buying oil to change yourself is more expensive. Getting dinner made by someone else is cheaper than in the big city, making dinner yourself is more expensive.
So (in my situation) if you're living in a rural community, you're spending less on your own community (and getting less from them), and spending extra to the other communities. Which is not that nice for the economic health of your community.
You don't have to move to NYC or SF - you just can't stay stuck in Cleveland for 20 years after the factory jobs disappeared.
There's opportunity to be had in Texas, the southeast, the northwest.
> Mobility and a willingness to learn new skills seems to prevail. It's what other generations have done, millions of immigrants (my parents included).
Yeah, but after all the moves I've done in the last 10 years, I'm starting to realize that the cost of moving isn't just the cost of a U-haul truck. The cognitive load of finding new grocery stores, new dentists, new mechanics, a new social scene, a new favorite restaurant, navigating a new city, working with new utility companies...
It's really a lot. It's more than I realized the first time I changed cities at age 17. That time, I thought I was depressed. Actually, it just took me a couple of years to achieve the stability that I had when I lived with my parents. I couldn't take on more cognitive load until I dealt with the basics, so stuff like relationships, socializing, and advancing my career all went really slowly at first. The second time I moved cities I also moved countries. I'm older now and much better mentally equipped to handle these problems, but I also notice it a lot more than I used to. Moving is _hard_. I don't expect to have a healthy social network for at least another year. My relationship seems to be standing up to the pressure, but trust me, there has been pressure.
The effort was worth it, but the cost is very real. If I could have avoided paying it, I would have.
Research backs you up- people are less willing to move than in the past. In the case of this lady though, I can understand moving being a really bad & undesirable option if you're only a few years away from retirement. That's not the best time to buy a new more expensive house in a more happening locale.
Mostly because rich parts of the US like the sillicon valley don't want these people to move there. The zoning regulations prevent building more housing. Rent control is a subsidy for long term tenants against newcomers. (Rent controlled apartment goes for $1500 but should actually go for $2000, land lord sells second apartment for $2500 to cover losses)
Anecdotally I've moved nearly 6 times in the last 8 years.
You have never experienced being a part of a community, that is why you don't value it.
I can totally see this happening to an "older" generation - people who get decent jobs locally but then in their late 40s or so are forced to deal with the uncertainty if the industry they are in gets into a shaky state.
Also, these things are periodic in some industries. Construction, for example, is booming where I'm at right now - you have to wait a few weeks for anything semi-major to be done because there's a shortage of contractors. Back in 08 they'd come sweep your porch on a 5 min notice :)
One other point/observation - I personally know quite a few ppl who live/work in the country - all of them had their kids move to either a large metropolitan area in the same state or farther out after graduating from college. Kids who graduated HS also left for the most part, some stayed but mostly in situations where there's a family business for them to partake in.
Moving to where there's more work is what other generations did, before the rent there got too damn high. There was an economics paper about this recently, blaming ills of vaguely this sort (I'm sorry I don't remember better) on the housing restrictions in the American cities with growing economies.
> That just isn't the case anymore.
It's never been the case. People have always moved to find work and today fewer people are moving than ever.
Strict universal nomadism is incompatible with agricultural development. Most of human existence has been nomadic, but the recent default for ~10000 years has been sedentary (non-migratory) mainly because of agriculture. And we've replicated the "farmer schedule" in most all subsequent careers.
The rise of interdisciplinary personalities (or at least recognizing this is a thing) might just be a new old thing: the modern version of a nomad who had to become near expert at a wide variety of things for survival as well as intellectual stimulation.
It's not nomadic in the sense that nobody was moving thousands of miles in one fell swoop into completely foreign environments full of complete strangers and an unfamiliar culture.
Nomadism is entirely compatible with agriculture, actually. A lot of Native American tribes had a nomadic lifestyle while simultaneously relying heavily on intentional agriculture for a lot of their caloric intake.
"Strict universal" is doing a lot of work there. I suspect very few societies would end up even qualifying as nomadic with that.
One reason: costs created by artificial real estate shortages.
These people don't want to move because they value community and social support over economics. This attitude is baffling to HN because it defies quantifiable metrics unlike money. Seeing everything as an economic problem is the essence of greed.
Actually, economic models often include such concepts as community and social support. In fact, they can often be quantified too: you can measure what's the necessary increase in salary to convince people to give them up.
There's nothing "greedy" about trying to formally model a situation, which is what seeing as an economic problem is about.
And people who expect others to pay for them to have the "community" they want (pay to support them living without jobs because there are no jobs they can do in that area) are not greedy? If Jane works hard to move to the city and do something others value enough to pay for, why should she have to support Jo staying back in their hometown because Jo doesn't want to experience the hardship of moving?
In my experience, people who call others greedy are expecting others to do something for them while giving nothing back in return. Economics means A gives B something B wants in exchange for B giving A something A wants. People who oppose this seem to think that A should give B something without B giving anything back in return.
Not to mention that many on HN seem to be single, asocial loners with no significant responsibilities outside work.
>Some are rooted, embedded in their communities; and some are trapped — because housing is unaffordable where the better paying jobs are. And the jobs that are high paying are not the jobs they built their lives on.
There's some texture and nuance to this statement. I remember on NPR, they interviewed a lady whom mentioned similar sentiments; her and her husband had built a family, worked in the blue-collar industry (precision machining) for decades, and now were losing their jobs. She also mentioned that they had been living in a small town for a long, long time.
That last part bothers me a lot. It seems a lot of people just don't want to move. Anecdotally I've moved nearly 6 times in the last 8 years. My parents have done the same.
People are stuck on this idea of living and dying in the same city once they buy a home or have children. That just isn't the case anymore.
Mobility and a willingness to learn new skills seems to prevail. It's what other generations have done, millions of immigrants (my parents included).
But this is a good thing.
In our Delhi office, each elevator has an attendant who's sole job is to push the button of the floor you want. This means less space in the lift for passengers, and lifts being taken out of commission because there's nobody to push the button.
Removing this job (by having the technology to allow passengers to select their floor themselves) means improvement for the users.
The same applies to shop checkouts - I'd far rather go through an automated checkout rather than deal with a person at a till, faster and less distracting from what I'm doing. Same thing with buying things from amazon rather than going to a legacy shop, watching a movie on Netflix rather than renting a video from blockbuster, or returning library books to a computer rather than a person.
The problem comes when those who lose the jobs lose out - the guy who's job is to push a button I can easilly push myself, or the taxi driver who's job vanishes when the computer does the driving instead. We deal with those issues by education (so people can do better jobs that aren't automated), and social safety nets.
If a robot can do your job, it's a terrible job. You may need it with our current economic system, But that isn't a good thing.
The button pusher I think is a bad example. There are not many button pushers, for one, and secondly when we talk about the current industrial revolution, it's about machines replacing humans who are doing jobs with some skills. And there are many such jobs, like operating machinery in factories, and consequently many livelihoods depending on them.
Arguably replacing these jobs with machines is also too fast for any kind of proper transition. You can say "Move elsewhere then!" but as some have already pointed out, this is not always so simple. And, say that the machine revolution does happen world over, where exactly can you find jobs that match your skillsets? Don't forget the many others who will also try the same.
Absolutely, education and a social security net will help with the transition. But in reality, these two are often not an option for many people, and I doubt that the government can supply them in the same speed as the change itself. I fear that we'll have massive social unrest in the near future.
The root of the problem is the idea that you must be productively employed. It's a fallacy, and everything else that follows from it (like this notion that optimizations are bad because they result in fewer skilled jobs) are wrong for the same reasons.
Unfortunately, it's a fallacy with very strong social support. Including, ironically, these very people who are hurt most by it.
It might be a fallacy for you or I but there are some people who really struggle without the structure of a job in their lives.
There seems to be an implicit assumption here that a job is the only way to give life structure. What is the evidence for that?
There is no such assumption, I did preface my comment with "you or I".
And there are some people who can't cope with the structure of a job. both need to be dealt with - there are always structured jobs that can be done, volunteering at a museum for example.
Doesn't change the fact that if we can automate a job, espeicially if we can improve things at the same time, that's good.
We used to spend 90% of our energy growing enough food for our family to eat. This is far less now, and that allows us to devote more time to other pursuits. That's a good thing for mankind, as is automating any job.
If you don't think replacing people with robots is good, I assume you're against things like ansible, or kickstart, or computers in general.
If you don't think replacing people with robots is good
You are putting lots of words in my mouth there.
>We deal with those issues by education (so people can do better jobs that aren't automated), and social safety nets.
However, there really are no social safety nets and the US continues to decrease investments in education year after year. Additionally, I rarely hear of companies reinvesting that money into educating their employees or the community.
>If a robot can do your job, it's a terrible job.
This is a bit of a stretch. Some people care more about efficiency, which it seems is the case with yourself. Others value service more and robots have yet to match the service quality of a human.
> Others value service more and robots have yet to match the service quality of a human.
That would imply that the robot cannot do the job, so it doesn't really contradict the parent's statement.
Service is far better at somewhere where I can order and pay from an iPad at the table or a kiosk, sometimes humans meet the levels of service I get from the robot - i.e immediate service without having to attract attention, not getting the wrong thing, but it's not universal.
Self-service is a mixed bag. Yes, I like ATMs and Netflix (or Redbox). But I hate self-service at grocery stores especially if I'm buying produce etc. I'm not a big fan at home improvement stores much of the time either.
On the other hand I was listening to a podcast when I popped into boots to buy lunch. Fairly busy so there was a queue, I drew the short straw and got directed to the legacy kiosk. This means having to pause what I was listening too, lose concentration, and switch into conversation mode for no benefit at all.
Ikea is simply far easier to self-scan. Back in the olden days you could scan your shopping in the supermarket as you put it into the trolley. Rather irellevent now when nobody does a "weekly shop" in person any more but far better than the "put into conveyor". Go back far enough and you used to have to ask someone for every item you wanted, no self picking.
Poor you having to interact with your environment and acknowledge briefly another human being. Perhaps we can invent an app for this.
While your comment is hilarious, i still think if cashiers at supermarkets weren't a thing that would make for a MORE enjoyable and healthy environement to interact with our peers
It'd be more enjoyable if there were no checkout at all.
One of the problems with grocery stores specifically is that I buy a fair bit of stuff that isn't bar-coded, especially produce. I also guess that I'm not so much into sticking earphones in when I'm out and about. (And I also do a sort of weekly grocery shopping when I'm not traveling; no especially good delivery options in my area and not sure I would routinely use in any case.)
Funny; in more than one supermarket here, you're supposed to weigh the produce yourself using one of these before getting to the register, even before the self-service checkout appeared.
Self-service checkout in any form is pretty much a good reason for me to avoid a store/chain unless they were really compelling in some other dimension.
I completely agree. Bill Burr sums it up better than I.
> It's job is to remove barriers to make workflows more efficient, typically to the detriment of people, as they generally are that barrier.
Another way of putting this is that tech is organised solely to meet the needs of the Capital class and no-one else.
Well, it is there to help people. It's there to help the people who are paying the tech company. This is often not you, and your interests are often not aligned with your employer.
"I think one of the biggest myths about tech in general is that it's here to help people."
It does... if it didn't, it wouldn't exist. Tech is a net positive for society. You typed that on a machine that gives you access to the world's information in seconds at minimal cost. Efficiencies drive down costs which benefits society as a whole. Can you imagine how much your computer/phone would cost if the production of it wasn't automated?
"Efficiencies drive down costs which benefits society as a whole."
Those same efficiencies remove people from their jobs. First blue collar jobs and later, as we will see, more technical and intricate fields. So the cost cutting yes is beneficial to the company and yes a potential side effect is prices decreasing but another side effect is more unemployment. For people that are highly educated, they potentially have the ability to transition to other fields. For people less educated, they're stuck. That doesn't necessarily benefit society as a whole.
I'd argue that reducing the chances of dying and increasing the chances of reproductive success are not the same as "helping people" in the sense of actually allowing people to live meaningful and fulfilled lives, which at the end of the day is all that matters.
It's not as simple as that it's here because it 'helps' people. It's inevitable that tech comes about - it is possible and if you don't use it you are behind.
I wonder how long it will take for this thought to fade from Steve's mind once he returns to SV. It's easy for people come to these realizations after getting outside of their comfort zone but just as easily return to the status quo. I think one of the biggest myths about tech in general is that it's here to help people. It's really not. It's job is to remove barriers to make workflows more efficient, typically to the detriment of people, as they generally are that barrier. Once a company gets a robot/computer to do what a person does it's next logical step is to layoff those workers. You don't have to go to your summer home to see people are having hard times. You just have to walk down Market Street.
Plenty of people in tech, especially in the Bay Area, have never known anything but a quite comfortable middle class (or better) life. They're very much disconnected ("in a bubble") from what it's like to live a lower-class (which has an upper income much higher than the poverty level) life in this country.
The disconnect between high-paid techies and the lower-class is in many respects far greater than between the billionaire and the millionaire.
No matter how big money people make and how comfortable their way of life is, they always think themselves as lower-middle-class and claim they are on the verge of financial difficulties.
I feel like I can afford whatever I want, and I don’t think I make more money than most people on HN.
Do you have a house? A boat? Recreational vehicle? A private plane?
Maybe your wants are modest :)
Isn't the same true on the other side? If you ask working class people they'll usually say they're middle class.
They're as much in a bubble as the people in classes far enough above them if that's so. Much of what they think they know of the middle class comes from pop culture (e.g. TV shows, back in the day) or their very limited interaction with friends or their children's friends' families who actually are middle class. When I was growing up (working class, impoverished frequently) my parents never would have described us as "middle class."
To me the main difference is whether people can afford housing , a family and be confident that their retirement will be OK. In that sense a lot of tech workers also have fears about the future whereas people like Blank will never have to worry about existential issues. That's the main difference to me. It used to be that a middle class job would ensure a safe future but that's getting less.
People in tech rarely feel the squeeze to the degree that those in service / manufacturing industries do.
Certainly, before I had a tech job none of my service level jobs left me with any money in the bank, if I got fired I had no money period. Now if I lose my job I have a few months.
We get paid ok but most of us barely have one home. There is no common bond between the regular tech guy and a successful VC. Different worlds.
> We get paid ok but most of us barely have one home.
If the average 'tech' worker is 28 and single, that's normal, not a sign of 'squeezing'.
I think you got it the other way around.
I am 29, and single...
But I am single BECAUSE I am nowhere near owning a home, in fact I don't own a home, or a car, or anything, to the point I stopped looking for a girlfriend because... why bother? It is not like I can even take her to a cinema.
Neither me nor my girlfriend own a car or a house (and hopefully we never will). Why would either of those be an issue? Plenty of people date and live together in apartments.
No? I spend 30 hours or so a week learning my trade. No one else does unless they get paid for it.
I think it's pretty similar with artists, musicians, writers, etc -- pretty much any other creative field. The difference is that we get paid a lot more.
I don't know anyone working in tech who worries about affording food. At most tech workers worry about affording a big enough apartment/house.
Oh but dont worry - tens of thousands of tech millionaires will be heading up to burning man to show just how in touch with humanity they are.
> He should rename this to "Working outside the millionaire bubble".
Calling it a tech bubble or even a millionaire bubble is bordering on offensive.
Sure I'm probably in a tech bubble and I'm probably in a millionaire bubble, but I'm not in Steve Blank's billionaire bubble. Compared to Steve Blank, I'm hurting financially.
> What it comes down to is that a lot of people with money have lost touch with the rest.
Have people with money ever been in touch with the rest?
"Sure I'm probably in a tech bubble and I'm probably in a millionaire bubble, but I'm not in Steve Blank's billionaire bubble. Compared to Steve Blank, I'm hurting financially."
That's exactly my point. He is trying to bond with all tech people but most of us make OK money but we are far from his position in life.
Reminds me a little of polticians talking "folksy" while they probably never ever interact with working class.
Yeah I agree with you.
I'm sure he interacts with the working class, but let's not lose sight of the fact that he has as much money as 2500 millionaires.
He should rename this to "Working outside the millionaire bubble". Plenty of people in tech feel the squeeze too. What it comes down to is that a lot of people with money have lost touch with the rest.
Being outside the tech bubble is hardly a desolate wasteland. Certainly many of you have friends and family outside of tech circles, and already know this. Tech is certainly a nice field filled with opportunity, more than many other professions at the moment, but there are often massive downturns in tech which make other careers suddenly seem much more compelling. Not to mention that no one asks if a 40 year old building engineer is still capable of being a building engineer.
The solution to some people getting played by the system surely isn't to play everyone even more by that same system.
I figure UBI will look like it's succeeding for ~10-20 years, then we'll see what the real impact of it is (as people grow up with it). There's also little consensus on how comfortable the basic income should be; I get the impression that if it is too comfortable, you'd be a fool to work, if it's too uncomfortable, the bleeding hearts will call everyone a nazi until it's made too comfortable.
UBI is welfare with a different name. The results will be the same.
Some people will sit on their asses and never work a single day but the majority of the population would keep working. The extra money would become meaningless because prices would adjust to accommodate it.
We have to keep in mind that you can't just create money and hand it out and make everyone rich. If everyone had 10x as much money prices would end up going up 10x. The supply of real goods you can use that money for hasn't changed. The huge increase in demand would lead to a supply crunch and much higher prices.
The money we're giving out for UBI has to be taken from someone else. What UBI is calling for is wealth redistribution, something I'm in favor of. But people seem to think it's magic around here.
If we pillaged the top 1% and distributed their wealth evenly the entire rest of the population would get close to a 100% raise. That's how filthy rich the top 1% are.
> If we pillaged the top 1% and distributed their wealth evenly the entire rest of the population would get close to a 100% raise. That's how filthy rich the top 1% are.
The problem with this, of course, is that the rich would simply leave. They are the most attractive to rob, and the best prepared to escape.
In addition, "the 1%" is not an exclusive club; most people (currently) have a pretty good chance of entering the 1% at some point in their life, most in the 1% have a very good chance of exiting it.
> In addition, "the 1%" is not an exclusive club; most people (currently) have a pretty good chance of entering the 1% at some point in their life, most in the 1% have a very good chance of exiting it.
You can't be serious. Social mobility (to the extent it ever existed) is way down over the past 40 years, and there's no sign of that trend reversing.
I assume you meant the top 10%. In the US 56% of people will spend a year or more in the top 10%. 12% of people will spend a year or more in the top 1%.
I had no idea that 12% of the population makes top one percent income for at least a year of their life. What causes so many of these people to fail?
How could there possibly be so many jobs that offer that kind of income. Or maybe it's that most jobs offering high income have short tenure..
The 1% for the most part aren't billionaires. Last year in the US, the threshold was just under $285,000. Ignoring professionals, plenty of small business owners can hit that on a lucky year. (And get hammered other years). There are a lot of jobs in the US with companies with fewer than 50 people.
Confiscating the assets of the 1% to create economic prosperity has been tried a few times before, and usually turns out horribly in ten years. You've removed the people who risk their own money from society, and replaced it with only assest allocation by bureaucrats.
Plus, as soon as you removed the one percent, then you have a new one percent.
See Dekulakization https://en.m.wikipedia.org/wiki/Dekulakization
The solution isn't in removing them, but in going back to the top tax rates of the 1950s/1960s/1970s, which were around 70% for the top bracket.
With that, you can then reduce the taxes for the lower economic classes, and fund better infrastructure and education.
As much as I like the idea of wealth redistribution I have the same doubts it will work. A similar phenomenon happened in South Africa when it was tried. The initial wealth distribution worked okay but it got rid of owners that knew how to run a business and replaced them with corrupt politicians.
As much as many of the 1% don't deserve it... A lot of them have that much money for a reason. The ones I knew, the "new money", were generally extremely intelligent and hard working before they made their millions. A lot of them are on permanent vacation now but if all of us had that much brains, charm, and grit it would be a lot easier to get rich.
> A lot of them are on permanent vacation now but if all of us had that much brains, charm, and grit it would be a lot easier to get rich.
Don't forget that sometimes luck is a big part of the reason why some of those people are successful.
Are they counting income from inheritance, selling assets (houses), etc? I wouldn't be surprised in that case.
Short answer, not really.
It looks like this is the source for the claims:
This is what the paper says:
"Total family income is the measuring stick used to determine levels of affluence achieved. This is defined as taxable income of head of household and spouse, taxable income of other family members of the household, and transfer income of head, spouse, and others."
Based on what I know about US tax, you don't have to pay taxes on the first $500k in gains for your primary house (if married), and inheritances usually aren't considered taxable income.
The problem with this, of course, is that the rich would simply leave.
The rich can leave, but the profits their companies generate locally can still be taxed. And they can be taxed more when the money gets sent to wherever those rich people went to.
That's a pretty bold claim about people's chance to enter and leave the 1%. Additionally there are only so many places to run to and its not like peoples money is all tied up in gold that can be smuggled out of the country anymore. It's pretty easy for governments to just put a block on their accounts if for some reason the wealthy decided they could make all of their money off of a society and then bounce when it came time to share in that same society
> most people (currently) have a pretty good chance of entering the 1% at some point in their life
I beg your pardon?
UBI is not welfare, it's by definition ubiquitous and unconditional. Welfare programs can and should exist in addition to UBI.
> The extra money would become meaningless because prices would adjust to accommodate it.
That's not actually supported in the literature.
The value of any currency is how much real stuff you can buy with it. If there's 20% more dollars in circulation each one would be worth 20% less.
This is why UBI is wealth distribution. Too keep the UBI money from being worthless it can't be printed money, it needs to be money taken from someone else.
It's not quite equal due to factors such as money velocity and liquidity. There's also the question of improved productivity/etc. to be had from this redistribution, which would increase effective buying power.
I mean, it is the case if UBI contributes to inflation, which it clearly would. Literature or no literature, if the money supply increases, prices will increase unless efficiency improves faster.
The lack of inflation following QE casts doubt on such a simplified model.
But in any case, you don't have to inflate to have UBI. Just tax money a bit when it gets distributed to shareholders.
There's been plenty of inflation post-QE, just not in the CPI. Housing prices post-crash are higher than ever, fueled by still-easy access to financing. Healthcare is up. Education is up. People are just taking the money that was shoved into the economy by QE and low interest rates, and using it for capital expenditures and investments instead of consumer goods. There's so much supply of consumer goods that the money is flowing to places where demand can't be met as easily.
 For example, the CPI tracks "owner's equivalent of rent" instead of raw housing prices https://www.bls.gov/cpi/factsheet-owners-equivalent-rent-and...
> Just tax money a bit when it gets distributed to shareholders.
Well, that would factor in as a depression of dividends for all stocks; that would only reduce the value of holding stocks, sounds like it would backfire tremendously. Then you have the issue of whether or not to tax dividends to foreign-held stocks: if you tax disbursements, it would compound some countries' taxes and ultimately reduce the value of holding american stocks; if you don't tax foreign disbursements, then the people you're looking to tax would set up their holdings somewhere without a dividend tax.
I'm wondering how you think this could work.
Right, first I need to state that I would increase the income tax; anyone making about $100k would essentially pay extra as much as they received from UBI, and people making more would end up paying more than they'd get from UBI.
So the tax on dividends would just serve to cover the gap, not the full amount.
>>Literature or no literature, if the money supply increases, prices will increase unless efficiency improves faster.
No. This is one of the pitfalls of economics: overly simplistic models that don't (can't) properly account for external factors, and assume everyone has perfect information and behaves rationally.
The real world does not work that way.
I think for UBI to work, it has to be paired with a VAT/sales/transaction tax. Its also not a boolean: no UBI or gushing UBI. In fact it seems much more reasonable and palatable to start small with periodic up/down adjustments to keep the economy running (perhaps very similar to the current fed interest rate adjustments).
Surely at some modest level UBI is likely to greatly benefit the bottom (who will likely immediately inject the money into the economy). As with anything in life, yes, people will argue over it. That's probably a good thing.
I think UBI would be unsustainable without additional investments in education. If you are going to be taking public monies, that time should be used to educate oneself or provide some form of public service.
What's the point, if the jobs keep getting automated? Why should we force people to do "public service" that robots can and will do better?
so what do you do with the people?
"We" don't do anything with people - we don't own them. They do whatever they want to do with themselves. Maybe art and crafts. Maybe some meaningless but interesting research. Maybe just live a life of pleasure. I suspect there'd be a lot of different answers. None of them are wrong.
Why do you have to do anything with the people? Certainly they will find something to do themselves, either hobbies like gardening or more serious endeavors like trying to establish a self-sustaining colony on Mars.
As others have mentioned, I think requiring education would be a bit of fighting reality (with eventual automation outperforming humans in many tasks). I think, as in the current world, some people will naturally choose to produce and contribute while others will not. Largely this is okay... (open source software, wikipedia, school PTA groups, hacker news, ...). Encouraging people to contribute to society seems like an undebatable good thing, requiring them to do so, not so much.
In this case that won't be UBI, but rather a scholarship grant.
Which is itself a rather interesting idea.
By some estimates we have 20 million opiate addicts. What happens when the opiate addict runs out of his basic income on day 5 of a 31 day month?
What's the difference between running out of a UBI stipend, and running out of a paycheck too early? Either way, that addict is in trouble. At least UBI won't put them on the street when their addiction renders them useless for work.
IMO, long cycles in pay (weeks or a month) are suboptimal. If the money streamed in continuously, slowly, then it would only "run out" for a matter of minutes, although it would still take a while for a useful amount of it to re-accumulate.
I definitely don't follow the logic that they won't be on the street. If they run out of money they'll be evicted whether it comes from a job or the UBI.
Opiate addiction is an important, yet unrelated problem. With regards to UBI, its no different than a million other addictions (gambling, alcohol, social media, etc)... We, as a society should look at reasonable ways to address addiction issues of all sorts, coupling that solution with UBI implementation doesn't seem like a great idea.
This is the use case for universal basic income. Its largely not their fault for their current economic situation. They played by the rules. They worked hard. If we could only remove the "necessity" of a job and the puritan shame of unemployment to live a moderate life of meager means. People should be encouraged to contribute to society not to simply "get a job".
One could say that about the whole article. The article sounds like it was full of people who I know (in the suburbs of a rust belt city), and other people from the small town where I grew up.
I don't think Trump lived a working class life before becoming president.
I don't think it was about that, it was about him being someone from outside the establishment that they perceive as being out of touch.
I've still not met anyone that's pro trump and believes most of what he was promoting. Sadly the most common response I get is "I wasn't voting for Hillary, so I voted Trump".
I truly believe these Americans feel they are are in desperate circumstances and someone from the outside that even acknowledged them, let alone claimed solutions, was bound to grab their attention.
I feel like Trump is also pretty firmly part of the establishment.
In my mind, the real reason people voted for him is that he said things that people were thinking. This seems to be something that nobody wants to admit.
> I feel like Trump is also pretty firmly part of the establishment.
I completely agree with you, but I think a lot of people still perceive him as being outside the establishment. And they voted based on that perception.
This seems to be something that nobody wants to admit.
Lots of people have said that. Even Hillary Clinton - that's what the "deplorables" comment was all about: https://en.wikipedia.org/wiki/Basket_of_deplorables#Speech (both "halves" fit with what you're saying)
"....but it’s easy to see why they might feel as if no one in Washington is living their lives...."
As an non-American I personally think this is why large number of working class voted for Trump, and something Clinton either missed or did not give importance to.
But today, Americans are less mobile ... some are trapped — because housing is unaffordable where the better paying jobs are. And the jobs that are high paying are not the jobs they built their lives on.
this is what i think about every time a politician, journalist or economist says that the answer for all these workers is government funding for "job training."
I work remote for Silicon Valley type companies but live in a location very similar to the author's New England vacation home. I try to buy locally and often joke that I'm slowly siphoning money out of the tech bubble and re-purposing it here.
All joking aside many parts of this country are struggling and I think we need to come up with more local solutions.
We could also make it socially important to spread the tech industry across the US, instead of trying to cram everything in the eastern third of San Francisco.
Well, we could make it socially important to make remote work possible.
The trouble with remote work is that if everything you do goes in and out over a wire, much of it can probably be automated. Remember call centers? Phone support?
> There isn’t an app to fix this.
Well, we could make it socially important to make remote work possible. The geographic concentration of tech thought and culture has been at least partly intentional.
Early internet culture seemed eager to do exactly the opposite. The inefficiencies of colocation were problems ripe for innovation.
If tech workers could live in small towns more easily, they'll have middle-class-squeeze conversations with friends and family, not just overhear other people having these conversations at local shops when they visit.
It feels extremely cynical to me. How can you not open your eyes? Every time I visit SF I see people who are so obviously going through hard times. It's not only the people living a pastoral fantasy sipping phosphates at the soda jerk who are worth thinking about.
Edit: I see that I didn't understand your comment actually, I agree. Privation is a rural/urban problem.
I'm not sure you read my entire comment. As I said toward the bottom, income inequality is a serious concern to me. I'm from a rural community and the individual struggles I see there are very upsetting.
But most people I talk to in tech are not in a bubble. They are aware of how hard it must be for people and want solutions.
The problem is we have two roughly equally sized political factions with mutually exclusive ideas on how to solve it that are pretty hostile to compromise.
I don't think it's the two sides that are the problem. They're symptoms of multiple problems. The voting system itself created a duopoly. One side of that duopoly has moved to extremes over the last 30+ years and dragged the other side with it. We need a way out of the two party situation.
The US has no extreme in the mainstream political left - Clinton, Obama, even Sanders are no more extreme than Macron or Blair. You don't even have a Corbyn figure, let alone someone like Maduro.
> One side of that duopoly has moved to extremes over the last 30+ years and dragged the other side with it.
Actually, I think the tactical move to the center of the Democratic Party (which didn't start with Bill Clinton, but his nomination was a pivotal moment in it) is he real key factor in the sharp rightward shift of the Overton Window that really led to the extremist takeover of the Republican Party, which has been increasingly radicalized.
Our communities are collectively organized to separate the haves from the have-nots. Capital acts as a gravity well so the wealthy tend to cluster together, and people trying to access their capital do everything they can to make the lives of those with capital easier. I can definitely see how it would be easy to become out of touch if you live in a wealthy community where the city and state affords you extra protection, services are organized around your needs, and most people you talk to are either in your employ or want to be. Eventually the wealthy begin to distrust the poor and the system becomes self-perpetuating.
This community organization problem stems from poor urban planning, suburbia, and what Jane Jacobs called the "Radiant Garden City". I'm still trying to tie all the pieces together for my own understanding but I know the solution is in there somewhere. There's an interesting movement called StrongTowns that elucidates this problem much better than I ever could.
They want something done about income inequality.
Something that doesn't involve them paying any (more) taxes, tho'. Just "someone" to do "something".
I think many of us are willing to pay more taxes and I think we show that by voting pretty overwhelming Democrat and or progressive.
I can't take this kind of piece seriously anymore. The decrying of an out of touch elite is a cliche.
This problem isn't getting any better because 1 it's a hard problem and 2 political gridlock keeps us from modernizing economic policy one way or another.
Most the people in the tech bubble I know are keenly aware of their relative advantage. They want something done about income inequality. A lack of awareness is not the problem here.
I do this regularly - go to the countryside, sleep in a hotel of a very small city, take pictures of abandoned buildings in once-thriving communities that died because the railroad station no longer has passenger service, or because most people migrated to cities. I don't live in SV, but it does help to put life into perspective the same.
Depends where you are. In Nordic countries it is pretty common. A lakeside cottage was quite affordable in the 60s so most middle-class families would have one, now often shared by a few families of grandchildren.
Steve Blank isn't common: https://en.m.wikipedia.org/wiki/Steve_Blank
Ah, that makes sense. Thanks pault.
With the real estate trends being the way they are, that may be more affordable as you think.
Real estate in the big cities is sky high, but as people are moving there, other places are getting more and more empty and thus cheaper. Buying a summer house for me would cost ~5% of my main residence cost, and it'd likely be larger.
A fun anecdote from a local insurance company handling rural areas - they insure houses for no more than the market value (obviously, so there'd be no motivation for arson), and if a house gets a major fire, that doesn't cover the replacement value (cost of repairs or reconstruction), not even close. So a surprisingly common solution/consequence after an insured fire is simply buying a comparable close-by house+land for the insurance money, since that's much cheaper than rebuilding the original one. Obviously that's not feasible in the long term, but those areas can go on for decades without needing to build a single new house as there are much more houses than families due to people moving to cities.
That's negative land value. Doesn't bode well for investment though, but more of a depreciating luxury like a weekend car.
No. It's common for rich guys. It has nothing to do with tech.
Nothing to do with the tech bubble except insofar as there are a lot of good salaries there these days. It probably depends on the area but in my experience on the east coast it's fairly unremarkable for a family to have a ski condo or beach house.
When I was growing up here in Michigan it wasn't at all unusual for a worker on the line at GM, Ford or Chrysler to have a summer cottage up north on a lake.
Now it's extremely rare for even two income upper middle class couples to do the same. A lot of those cottages are now owned by people from out of state who visit a few weeks per year. Folks who live the rest of the year in NYC, Chicago and Boston.
He's worth $2.5 billion.
Nothing to do with tech, I'd say it's mostly an mid/upper class trait; at least in Europe.
Second sentence starts with:
> We have a summer home ...
Is this common for people living inside the tech bubble?
It would be nice if "the problem" was simply that people lived in a bubble and didn't understand. That would be a relatively easily solvable problem, but this is not the case. Sure, people can be isolated from the experiences of others, but the overwhelming majority of us have friends and relatives working normal jobs.
A lot of empathy does exist. Empathy alone does not lower the rent, or cause those "good jobs" to reappear.
> No amount of retraining or "bootstraps" is going to bring the jobs back. It's just not possible to compete with the corporations and their larger moats and bankrolls.
This, frankly, is patent nonsense. And this sense of learned helplessness is a specifically American affliction.
There really just isn't a reason why there can't be reasonably compensated manufacturing jobs, or why corporate and industrial policy can't help depressed rural areas. As anyone who's traveled across Germany or Switzerland is well aware.
As a society we choose policies that concentrate wealth in this way. The point of view you're expressing -- that this is inevitable and unstoppable -- is not at all fact, but rather the product of decades of public relations by vested interests in this country.
So what's the solution? How do we bring jobs back to these depressed rural areas?
The paradox of capitalism is that business interests (capital) are in direct opposition to workers' interests. Businesses are incentivized to reduce costs, which means paying workers as little as possible, squeezing as many hours out of them, and laying them off as soon as they're not needed.
Sure everyday workers are sometimes the customers as well, but that's becoming less and less the case. Google and Facebook don't make their money off you, they make them from advertisers working on behalf of businesses. Real estate developers in Manhattan don't make money building affordable middle class housing (hence the non-existence of such developments), they make them off luxury high-rises targeting the wealthy.
Combine that with technological advances and globalization allowing increasingly consolidated corporations to replace workers with robots/software and move jobs overseas, and the end result is that wealth is more concentrated, the economy is more concentrated (plutonomy), and your average Joe living in rural New England just doesn't matter as much to the vault-holders in an economic system where we only see each other as dollar signs.
No amount of retraining or "bootstraps" is going to bring the jobs back. It's just not possible to compete with the corporations and their larger moats and bankrolls. The only option is to work for them, or perish. These corporations aren't building anymore satellite offices in rural areas or opening up to remote work (due in part to the increasingly competitive job market), so the only option is to move to expensive cities with chronic housing supply shortages. These rural areas are as economically useless to the wealthy elites who run the show as the homeless people camped outside their offices.
Anybody who claims we're not ready for a UBI yet is living in a bubble.
Leaving SF means that the cultural and societal environment is different. Going to places like these means that the technology, money, hope, and jobs are physically far away and beyond livable reach; places where people wonder why anyone would ever live in SF.
No need to leave SF to escape the tech bubble and encounter those being left behind. Look closer.
If you feel guilty enjoying the product of your work, you were probably doing pointless zero-sum work that did not need to be done. It is fine to say you want other people to be economically empowered, but the amount of guilt flying around here is incredible. Why not apply the constraint of only doing things that actually benefit other real humans at the start of your career, and feel good when you end up being successful at whatever constrained but moral venture you undertake. Feeling guilty about it accomplishes nothing. We made the collective bargain to build a technological society, we cannot go back now. Fix the real problems and it won't feel dirty.
I was on BART a few weeks ago and had two tech dudes strike up a conversation about JIRA directly across me, shouting over the din of rail noise. It can get obnoxious.
JIRA ... the bane of our lives!
It's not all about you Louise!
One of the main reasons I don't live in SF is the conversation.
The first time I visited, I heard tech talk in bars, cafes, on street corners. If I can't get a beer or a coffee or take a walk without hearing about work, it's not for me.
Also new note for 2017 is that "economic anxiety" doesn't mean "economic anxiety" anymore. Need a new term for that now.
He's not surprised. The point is that SV culture is designed around intentionally obfuscating people who aren't in tech or law or academia behind apps and services.
Yes, obviously, those people live and work in parts of SV, just like anywhere else. But SV is built around not having to see or interact them as human beings who have lives and problems outside of the narrowly scoped tasks people in the bubble hired them to perform. Thus the entire bubble metaphor that was the point of the article.
The author doesn't express surprise at this. The quotation and surrounding text are just a dispassionate description, probably intended for people (unlike the author) who rarely if ever step outside the sv bubble.
Which part made you think this was an "epiphany" fit the author?
The author expresses that they meet the people in a different context. Sure, you see bus drivers doing their job, but you're not talking with them about life while they're at the wheel.
In the tech bubble, chances are that the cook and the bus driver and the janitor just works there - they don't live there (because they can't afford it), they don't go to diners and pubs there much, it's as if they live in a different society that just "visits" that world during work. In the semi-rural area, they were part of the same society, in the tech bubble they're two separate societies increasingly growing apart from each other.
Additional idea: do some volunteering outside of the tech industry.
> Most people aren’t in tech or law or teaching in universities; they fall solidly in what is called working-class. They work as electricians, carpenters, plumbers, in hospitals, restaurants, as clerks, office managers, farmers, etc.
I'm surprised that he's surprised by this. Even in SV you can have a reality check, if you just deign to strike up a conversation with the cooks and the bus drivers and the janitors who work all around you. No need to take a road trip to the summer house to have this epiphany, just open your eyes.
There are other bubbles.
which is good,so there are more people to sell to.
Even within the tech world. Most of the tech world exists outside the tech bubble. The tech bubble is concentrated around a few select cites.
ew NE rural culture is so unappealing to me. I don't live in a tech bubble, but the Mtn West.. so much better.
There are two main reasons for this:
1. Ever increasing regulatory burden (basically increasing government)
2. Ever increasing self-imposed diversity burden within corporations (few productive people dragging up a bunch of SJW redistributors)
> It’s good to spend time outside the bubble
I disagree. The only thing marginally good about being outside of the bubble is pulling up to a gas station and getting sandwiches, chips, candy and drinks for $4.32 total and being able to pay for it with a credit card without worrying about a $10 minimum. But if you've adopted celiac disease you are SOL.
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Steve is well past his twenties.
Steve Blank is not 20.
Yes, but he is worth 20 something hundred million dollars. That kind of makes him a 20 something.
Genuinely laughed out loud.
Replace this with "coal bubble" in WV, "oil bubble" in SD, "Hollywood bubble" in LA, etc. etc. etc. or just title these "20-something learns there's a world outside their immediate environment and boy howdy is it different."