
On Day Care, Google Makes a Rare Fumble - terpua
http://www.nytimes.com/2008/07/05/business/05nocera.html?_r=1&adxnnl=1&oref=login&partner=rssnyt&emc=rss&adxnnlx=1215254818-59OmZCQO0HIy0VGdQlO4Ug
======
nickb
The big issue that Google has (incidentally the same issue that MS went
through) is the two classes of employees that they now have and the resentment
and disconnect between the two groups. The two groups, of course, are those
who are millionaires and are 'fully vested' and those new googlers who are not
millionaires (and probably never will become millionaires). The latter group
relies on a salary to live in a very expensive area and they count on every
perk as a way to reduce their bills so they can make the ends meet each month.
One site recently showed that average salary at Google is around $110K. In the
valley, that's not a lot when you factor in the cost of living. So this
increase in daycare is not a big deal to all those millionaires and yet it is
a huge increase to those that can't afford it.

As Google matures and they start cutting even more of these perks, the two
groups will start growing even further apart. It's a serious organizational
issue and Google will need to tackle it quickly.

~~~
menloparkbum
Mountain View is indeed expensive but $110K is $50K more than the average
household income in the Bay Area. Aside from packing 3 people to a cube,
Google pampers its employees above and beyond almost any other company in the
area. There is free food, health insurance, free gym, free laundry, free
haircuts and so forth. Taking this into account, a Google employee doesn't
have to spend much money on anything other than rent, transportation and food
for the kid. Even if renting a $3000/m apartment and leasing a Lexus a Google
employee making $110K a year would still have $50K a year left over. "Making
ends meet" perhaps isn't the most accurate way to describe the situation these
people face.

~~~
arn
But Google day care is said to now cost $57,000 for two kids in post-tax money
(which means closer to $80,000 of pre-tax money). right?

~~~
menloparkbum
Yes. It does seem absurd that Google day care costs more per year than
attending Harvard. A full time nanny can be hired for half that. Someone with
a $110K salary and a working significant other has plenty of options for child
care. If they are truly struggling to make ends meet, they are simply
mismanaging their finances.

I'm assuming the other person works too, which is why they need child care.
Thus, their actual combined income is over $110K, which is an enviable
position for any household, even in the Bay Area.

~~~
dmix
Then hire a nanny?

People get too used to what they have. Try leaving and seeing how much better
plan B is.

------
gaius
The problem with flat organizations like Google is that they aren't really
flat at all; all that happens is the org chart is hidden rather than out in
the open. This story is nothing to do with daycare per se; it's to do with the
crackpot ideological ideas of one individual who is very powerful on the
hidden org chart, and is abusing her position to further her own social
engineering experiments.

~~~
shimonrura
I think it also gives a clear example of out how brittle "don't be evil" truly
is, when administered by a "management committee" consisting of people who are
mostly multimillionaires.

Perhaps a more equitable and user-responsive way to provide day care would be
to let local offices or workgroups organize their own childcare groups, with
some degree of corporate subsidy and other support.

~~~
gaius
You know, Marie Antoinette is famous for saying "then let them eat cake" when
told that the poor of Paris had no bread. That wasn't her being cruel; she had
been raised in such luxury that she simply couldn't comprehend that there was
no food at all to be had outside of her cloistered world. The pre-IPO Googlers
have all the characteristics of an aristocracy now...

~~~
smanek
I don't think that's true ...

I believe that the original source of that quote was Rousseau, referring to an
unnamed princess, some 20 years before Marie Antoinette was even born.

There is some speculation that he may have been referring to Maria Theresa of
Spain, but even that is doubtful.

------
fiaz
From the article:

"Meanwhile, someone at Google woke up one day and realized that the company
was subsidizing each child to the tune of $37,000 a year — which nobody had
noticed up until then — compared with the $12,000-a-year average subsidy of
other big Silicon Valley companies like Cisco Systems and Oracle."

It seems that Google was quite generous over the years and finally realized
that given the difficult economic times that they as a company must do
something to bring their internal spending in line to a more realistic range.
I don't see why Google should be penalized for such a move.

Unfortunately for Google, the fact that this is a move that affects children
and families such a story becomes even more sensitive. Google is a business
like any other business out there. Why are they being treated as though they
are something other than a business?

~~~
condor
It seems that google was generous in the way a company is generous by having a
policy to pay for traveling employees' hotel stays at the Ritz, and when it
learns that they are paying 4x more than competitors who have employees stay
at the Marriot, changes its policy by having employees stay at the Ritz but
charging them to cover some of the subsidy, instead of changing their policy
and paying for employees to stay at a lower priced hotel. Apologies for the
looong sentence.

~~~
pmorici
Exactly! The "evil" part about this isn't that Google wants to reduce their
subsidy from 37k to 12k it's that Google wants to reduce the subsidy w/o
lowering costs.

That said no one is forcing the parents to use Google child care and they
could presumably band together and go to the company that ran the original
lower cost care service and have them open a cost effective center near by, or
something to that effect.

------
cpr
I know one shouldn't question orthodoxy, but it seems insane to me to have
children and then dump them all day, from a young age, with strangers. What's
the point of having them if you're not raising them?

~~~
davidw
As the parent of a 2 month old, it's a difficult question we're facing right
now. Who? How? When? Should my wife, with a doctorate in biochemistry, abandon
her career completely and stay home? Should I? I'm not enthusiastic about
those options. Should we hire someone? Not wild about that either. I think the
best would be to kind of try and switch off, but it's going to require a lot
of flexibility, and perhaps earning less money. The second is probably ok,
depending on wherever it is we settle, the second may not be forthcoming from
many employers. _Sigh_...

~~~
lisper
With all due respect, did it never occur to you to get this all figured out
BEFORE you had kids?

~~~
davidw
Wow, I don't think I've ever been so offended by something on this site. Your
implication that I haven't thought about the future of my daughter is...
something I hope you never say to any other parent.

We've done our best to think about the future, but it's unknowable.

~~~
pg
I don't think he meant to be so offensive. He may just not realize how hard
this problem is.

The fact is, finding a perfect solution for taking care of small children in
an industrial society is probably an insoluble problem. And if so it's not one
you can solve before having kids, or after them.

~~~
davidw
> I don't think he meant to be so offensive.

Looking at it again, I hope that he wrote quickly without really thinking
about what his words meant.

~~~
xlnt
You still haven't thought about what his words meant.

You said you were facing a certain problem "now", 2 months after the child was
born.

You could have made your decision about how to handle it prior to the child
being born. If you'd done that, you would not be facing the problem now, it
would be decided. But you didn't.

He asked about why you didn't decide in advance. You got offended by the
implication that you hadn't decided in advance. That was something you said
yourself, so it's unreasonable to be offended by it, or to blame him for
noticing you said it.

~~~
ph0rque
Do you have any kids? Do you realize how unpredictable it is to plan things
for your child, for example, how sick the child is going to be, or how well-
tempered?

~~~
xlnt
My post is simply about logic and who said what. Nothing more. Why can't you
read it rationally?

And, BTW, if you and other parents can't read it rationally, why should I
believe you handle parenting matters rationally? Parenting matters are more
difficult and more emotional than reading a simple forum post.

~~~
pg
Here is the rational answer you seem to want. (a) This problem is so hard you
can probably never solve it satisfactorily, and (b) you can't know what it's
going to be like to have kids before you have them, or what your kids will be
like. So however much thought you expend on the question before having kids,
you're still going to be working on it afterward.

~~~
Create
Society has a response to (a) and (b). It is called a social net, based on
solidarity: it works like insurance schemes should (not speaking of fraudulent
market schemes, e.g. the US health insurance). I think the biggest problem is,
that you despise pooling resources into social systems purportedly designed to
help in (a) and (b). "Old" Europe has suffered enough in WWII to recognize the
importance of it, and erect such a system, which is frowned upon by "risk
tolerant entrepreneurship" (they have enough personal wealth to fall back on).
This social net you are missing is being therefore dismantled in the EU as
well, since it is regarded as uncompetitive compared to the US or China. It is
a race to the bottom (if you compete with slaves, you become a slave*), of
which the GOOG kindergarten is just a sign.

<http://en.wikiquote.org/wiki/Norbert_Wiener>

~~~
davidw
We live in Europe, and no, handouts not really the answer we're looking for.
We're aiming at a flexible schedule for both of us in order to both have time
with our daughter. The safety net stuff is nice in some ways, but it's not
really what we're after.

------
mynameishere
_Parents who had been paying $1,425 a month for infant care would see their
costs rise to nearly $2,500_

"$1,425" was the subsidized price? If someone told me day care cost that much,
I'd fall on the floor, but that's the _good_ price. A woman where I work pays
30 dollars a day, and that's far, far too much. Unbelievable waste. Absolutely
unbelievable. $1,425 is more than my total monthly expenses. I could
theoretically make my living by watching _one child_. Clearly, this is an
industry just waiting for its Sam Walton.

~~~
ph0rque
Unfortunately, this industry isn't very scaleable: how many children should
one overseer watch, and still provide quality childcare? 2-7, IMHO, depending
on the age of the children...

~~~
andreyf
> Unfortunately, this industry isn't very scaleable

Clearly, you haven't seen my latest web-app...

~~~
ph0rque
Can I be a private beta tester?

------
robg
I'm saddened, but not shocked, that very smart people think you need to spend
$40k/year in daycare for children. Misplaced parental guilt?

~~~
diego
If you are a young couple with an infant in the Bay Area you don't have much
of a choice. A friend of mine and his wife decided that they would be better
off if she quit her job and took care of their two kids for a few years, as
her take-home salary wasn't enough to pay for day care.

~~~
robg
Is the limiting factor good quality observers/teachers? Why don't they open
their own daycare? It's a lot of work, but if a parent has quit their job any
ways, what's a few more kids?

~~~
HeyLaughingBoy
Quite simply: it's insurance and state-mandated minimum child-provider ratios!
The least we ever paid for childcare was $820/month and that was a very good
preschool that had extremely low staff turnover -- we were lucky. When my son
was younger, the costs were higher: infants cost over $1000/month.

That said, many people here in MN do in-home daycare which is usually much
less expensive. Usually it's a parent who has decided to stay home with her
baby and gets the training and insurance to care for other children as well to
cover the cost of her leaving her job. However, as you get to the preschool
years, the quality varies radically. They may give good childcare, but the
learning experiences can be slim to none. My son entered Kindergarten
extremely well prepared and immediately outdistanced most of the other kids.
Odds are that in-home daycare would not have prepared him for school as well.

------
noonespecial
_Don't Be Evil_ seems a bit like a levee system. Its easy when your town is
small to keep it surrounded by levees and the flood waters at bay, but there
comes a point when the town is just too big, a weak spot inevitably occurs and
the flood waters come roaring in.

------
Tichy
Why is daycare so expensive? Seems to me you need a room and two to three
people to watch over the children. If you have 10 children in the room, and
everyone costs 40000$, that would mean it costs 400000$ per year to rent a
room and pay the salary for three people?

It seems child nurses earn a LOT more than the average IT person?

~~~
gaius
Consider any school. They have teachers, sure. And they have caterers, and
cleaners, and contractors to maintain the infrastructure... There are a lot
more people involved than just the direct service providers.

~~~
hugh
Caterers: preparing food for ten children isn't a big job, all they need is
sandwiches and drink boxes which can be prepared in advance and taken out of
the fridge.

Cleaners: It's only a room, it only needs to be cleaned once a day. Shouldn't
be that expensive either.

Contractors to maintain the infrastructure: again, it's only a room,
maintenance really shouldn't be that difficult.

It's obvious that there's a lot of money flowing into childcare, and it's not
obvious where it's all going. It's certainly not going to the people who are
doing the caring -- they make almost no money at all. Is it all going to into
insurance and compliance with various regulations?

~~~
gaius
Read the article - Google's daycare has fancy organic food.

~~~
hugh
Can I just take this opportunity to say that the term "organic foods" bugs me?
I mean, of course it's organic -- it's food! With the possible exceptions of
water and salt (one could argue about whether they're really food) surely all
food is organic.

~~~
esja
True, but can you think of a better single word (not a phrase) to convey non-
industrial-as-currently-practiced? "Natural" has the same weakness you
identify, so that's out also.

It's a bummer that there's no commonly accepted definition for organic, but
it's probably because at least for now, the fight is _against_ current
practices (which explains the many alternatives that have sprung up), instead
of being _for_ a particular practice, which could be named more accurately and
concisely.

~~~
gaius
"Organic" can also mean "does not require external assistance".

For example, the Marines describe a unit as "organic" if it can operate
without assistance from the other services (e.g. this is why the Marines have
their own aviation and don't rely on the Air Force the way the Army do)

------
railsjedi
There's really not much here. Reads like a political hit piece, with
"anonymous sources" relaying embarrassing quotes from Sergey Bin. I usually
expect a lot better from NYTimes.

------
froo
Hangon, so let me get this right...

Not only have Google basically doubled the cost of their childcare, but
they're also charging people for the priveledge to be on the waiting list for
that childcare?

They dont think this is a strange move at all?

------
ivankirigin
I've always paid for our day care. But this is a bad idea because googlers
would be more comfortable and spend more time working if day care were right
there at work. Near work or near home are the two most convenient places. I'm
told Mountain View is a cluster fuck for day care.

Of course they are missing a bigger opportunity in improving education here.
Like universities, google should be experimenting with different kinds of
education. They could make a big difference.

~~~
gaius
_google should be experimenting with different kinds of education_

Not quite true; Google is legally obligated to act in the best interests of
its shareholders, and _only_ that. That's true for any public company, and the
board can go to jail if they aren't seen to be doing that. With great riches
comes great responsibility...

~~~
ivankirigin
It's a huge business opportunity.

~~~
gaius
If Google entered the education business its shareholders would (rightly)
wonder what its competitive advantage in that market would be, and whether the
margins (return on capital) would be more or less than its existing
businesses. Seriously, what could Google bring to the table here?

~~~
ivankirigin
Education has followed an industrial/factory model for many decades, with few
exceptions. The founds of Google went through one of the exceptions:
Montessori.

We need to update education, and a tech company is the right place to start. A
simple example: build a natural language query system to allow a child to get
any question answered immediately. May as well call it 411-GOOG 2.0

These issues are very much related to how google makes money today.

------
far33d
I have a 7-month-old, and I believe that my wife has found the ideal care
situation. She works, from home, part time. Hours are flexible, she can stay
home with our daughter, and get most of her work done during naps or after I
get home.

I believe as time goes on, this is going to become more and more common as
there are more women in the workforce who are uninterested in waiting until
their late 30s to have children and telecommuting gets to be more common.

It's constant hard work for her, but she would never trade her time with our
daughter for the extra money from being full-time, even if that extra pay
covered the child-care (which it wouldn't).

------
ojbyrne
I note that it was a website banned here that first broke that story.

~~~
alaskamiller
Why yes, indeedy:

6/13 [http://valleywag.com/5016355/google-daycare-now-a-luxury-
for...](http://valleywag.com/5016355/google-daycare-now-a-luxury-for-larry-
and-sergeys-inner-circle)

6/16 [http://valleywag.com/5016952/googles-daycare-debacle-the-
kin...](http://valleywag.com/5016952/googles-daycare-debacle-the-kinderplex-
memos)

A broken clock's at least right twice a day, eh?

~~~
gruseom
Let's give them twice a year. And by reading here instead of there, I get it
all filtered for free.

Edit: I went and looked at them. They're very similar to the NYT piece, only
shorter. Perhaps HN should ban the NYT? :)

------
josh
There are two elephants in the room here:

1\. The exorbitant cost of the Bay Area (and other places like NYC, Boston,
D.C., etc.) - there's a reason the Bay Area has the lowest ratio of children
to overall population in the country. It's just not an affordable place to
raise a family. It's essentially a giant suburbs without the traditional cost
advantage of a suburb. You can live in Mountain View, Palo Alto, etc. for the
price of living in a world class city like Chicago. You make that choice. Good
for you.

2\. Where are the grandparents? As someone from a more traditional culture, I
don't quite understand the desire for couples to go it alone. Why not live
near your parents or have them move to live near you? Grandparent-grandchild
interaction is extremely valuable. It helps transmit your family values to
your children while allowing your parents to stay mentally active and it also
keeps them happy. It also significantly reduces childcare costs.

I'm not married yet and probably won't have kids for a few years but I really
think this is the correct AND affordable approach:

*Evaluate where you are in life. There's no point waiting for the perfect time. Adversity is good for kids - it prevents them from growing up to be spoiled brats. I grew up in a Third World country and the only things my parents weren't cheap on were my health/nutrition, safety, and education. That's all that really matters. Have kids before you're too old.

A) If you have a lot of capital or high salary, stay where you are, and have
one spouse work part time (can alternate), and suck it up till the kids are in
school. Mix in a few days of daycare per week to allow for part-time.

B) If you don't have a lot of capital or a high salary, move somewhere cheap.
Your spouse and you can both work full-time and afford daycare a few days a
week.

In both situations, have the grandparents around! If you're an only child,
it's easy - your parents will be there in a heartbeat. If you and your spouse
are one of 2 kids, then your parents can alternate. If you and your spouse are
one of 3 or more kids, live near your siblings. Raise your kids around your
family.

------
rw
"employer-provided day care, at affordable prices, ought to be like health
insurance, a benefit that every company provides as a matter of course."

If only this were true in more companies nowadays.

------
erdos2
It's expensive to raise a family in the United States. The economics and the
culture are against it. Add to that the cost of raising a family with someone
who turns out to be the wrong person: your expected income after marriage must
be reduced by the probability of divorce times the cost of divorce. Children
necessarily complicate matters.

The problem would be alleviated somewhat if more and more people owned their
own businesses, instead of the situation we currently have, of numerous
workers employed by a wealthy class. At some point, these workers should
simply refuse to work for anyone substantially more wealthy than they are. The
value to an employer of having a large pool of interchangeable labor is
calculable. Who created that value? Not the employer: the people. And it is
the people who should and who must demand that value they created for
themselves.

------
wumi
as a side note why do I have to click through two pages of ads to see the 2nd
page of the article? (I didn't hit 'print article' because I figured it was
another click to see the whole page anyways)

These msm companies online (forbes, NYT, et. al) really have not figured it
out yet.

------
dzorz
Someone mentioned 2-7 kids per "overseer". Where I went to kindergarden, ratio
was 20-30:1. Even later in elementary/high school, the ratio was 25-35 kids
per teacher.

~~~
dgabriel
There are guidelines and laws about child/caretaker ratios. Infants need a lot
more one-on-one time than older children.

------
schoudha
I work at Google and this article has a few statements that make it clear the
author's sources aren't credible (At least on this issue).

I wouldn't take this too seriously and I'm surprised that the Times:

1\. Thought Google's daycare policy was worthy of the front page

2\. Couldn't find a credible source who actual understands how and why the
decision was made.

~~~
erdos2
The Times is usually scrupulous about fact checking--except when it comes to
supporting Imperial adventures and warmongering.

------
jawngee
Didn't anyone learn anything from Bubble 1?

------
vlad
Today Google Preschool, tomorrow Google K through 12. :)

------
fairramone
Further evidence that Google is NOT all that it is cracked up to be. The days
of Google subsidizing child care would seem to be gone. Not that any other
organization is much better at this particular problem, unfortunately.

------
time_management
I'm going to comment on a micropoint, since the main issues seem pretty well
covered at this point.

<i>Having discovered that Google is not, in fact, the promised land, a number
of Googlers have left recently to join start-ups, hotter companies like
Facebook — and even Microsoft.</i>

Wait a second... Facebook is "hotter"? That seems unreal. It's not that
Facebook is a bad company, per se, but I'd much rather work at Google. I can't
imagine top-talent wanting to have Mark Zuckerberg, an arrogant 24-year-old,
as a boss. I can't speak for tip-top talent, but even still I'd rather gargle
a fistful of nuts and bolts.

