
An Economy of Grinds - mbateman
http://www.nytimes.com/2010/07/13/opinion/13brooks.html?_r=1&hp
======
msluyter
I generally like David Brooks -- "the liberal's favorite conservative" -- and
am mostly impressed by the fact that he incorporates modern neuroscience into
his account of economic and moral reasoning. However, sometimes I think he
gets overly enamored with a concept and, as in this case, tries to shoehorn
too much into a clever dichotomy. I suppose I'd consider myself a grind, yet I
work at a large corporation.

Still, at a high level, his point about the economic recovery not really
benefiting average folks or small businesses seems relevant.

~~~
enjo
Is it? It's hugely unsupported by data. For instance, we've seen several
articles over the last year telling us that new start-ups had reached an all-
time high in the United States. That would seem to run counter to his point
that the economy is faltering for 'the grinds'.

In addition we've also seen articles talking about increased MAA activity over
the last several months. The same goes for general investment.

I'm not sure he knows what he's talking about. He certainly seemed to pluck a
lot of assertions seemingly out of thin air.

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rfreytag
Careful people treat reporters differently in conversation. I'm surprised
Brooks failed to mention that.

The "princes" are interesting to a reporter (Brooks) because their career is
enhanced and their income largely secure when they are quoted.

The "grinds" don't want the reporter broadcasting their ideas before they have
achieved product-market fit and begun scaling.

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jtbigwoo
Some good points mixed with a fair amount of foolishness and surface thinking
here, as usual for Brooks.

You can make some good points about schmoozers vs. makers and how our economy
values social climbing more than actual productivity. The golf-shirt wearing
MBA's take a paint-by-numbers approach to business. They tend to do well when
things are going well and somehow avoid consequences when things turn.

The rest of the article doesn't make much sense.

> Princes can thrive in a period of slow, steady growth, but grinds need a
> certain sort of psychological atmosphere. They need a wide-open economy with
> plenty of creative destruction.

This should be rewritten as, "Grinds need a wide-open economy so that princes
will give enough money to grinds that they'll be worthy of my attention."
There are plenty of Grinds doing amazing things, but Brooks can't be expected
to seek them out when he's so busy eating lunches with the wealthy princes.

> The princes can thrive while the government intervenes in the private
> sector. They’ve got the lobbyists and the connections. The grinds, needless
> to say, don’t.

I known tons of grinds (professors, researchers, contractors) that make their
living through government grants and contracts. In government contracting and
grant writing, schmoozing is much less important than in the private sector.
(There's still a "councilman's nephew" problem, but I'd contend it's much
milder than the "COO's golfing buddy" problem in private business.)

------
gaius
I wonder how true this is in England. The last government was all about
funneling public money to private companies, but the present one is tearing up
those agreements like it's going out of fashion (this is the real story behind
the cancelled school building programme - after 13 years and hundreds of
millions of pounds, the last government had very little to show, so the
programme had to be scrapped).

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johngalt
From a grind's perspective:

This article reminds me of my stint in high-end B2B tech sales. The fortune
500 I worked for spent more than $80k just to send one person (me) to one
tradeshow. I was the nerd that was supposed to make all the demos work and
answer the tough questions. I was supporting the sales team (princes) from
another F500 company we had partnered with.

Watching the process was odd. Lot of marketing speak. Lots of expensive "sales
lunches". Not one hard technical question was asked by any of the attendees.

The whole time I couldn't help but think of what $80k in equipment and a week
of my time would have meant to the very project we were demonstrating. It was
also interesting how trivial it was for the sales team to ask for (and
receive) all this, when it would have been a month long fight for me to get
half as many resources to improve the actual product.

------
hristov
This is pretty disingenuous. Brooks tries to jump on the new fascination with
small businesses but only does it in order to carry the same water for the
same old people (who are, to use his own terminology, the princes). Most of
the new regulation he argues against will not affect start-ups and small
businesses but will mostly affect the large banks.

In reality what hurts the grinds most presently is that the middle class is
beaten down and ordinary people do not have much income. Small businesses
usually do not have access to the enterprise markets and usually have to rely
on ordinary people to be their consumers. And ordinary people are poor and are
cutting all discretionary spending. This is what hurts most of all.

------
specialist
If linking to a columnist, vs a news article, please include their name in the
link.

David Brooks enthusiastically supported Bush's Folly in Iraq. No mea culpa.
For that alone, I won't support his efforts with my (reading) attention.

I used to watch his tete a tete with Mark Shields on PBS. I can't imagine
anyone being more consistently wrong (and wrong headed) about more things than
David Brooks.

And that's saying something. The list of always wrong about everything is
pretty big: George Will, Charles Krauthammer, both Kristols, Thomas Friedman,
Ted Nugent (haha), etc.

Neocon concern trolls who aided and abetted the looting and destruction of our
country deserve our mocking, not our links.

------
billjings
So it's smart people at hedge funds who are going to get us out of this
economic crisis?

That must have been some dinner!

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adolph
I really dislike articles that use the amorphous notional "we."

In this case, maybe "we" refers to newspaper writers "mired in debates over
macroeconomic models" but I doubt newspaper writers are going to "to light a
fire under the country’s loners, its contrarians and its narrow, ambitious
outsiders."

~~~
Sumason
I would have assumed that, being the New York Times, he referring to readers
of the newspaper (Americans).

Quit intentionally being daft :P

~~~
adolph
That's one assumption. It might be convincing to me except that even though
many people I know are NYT readers, nobody I know is "mired in debates over
macroeconomic models." Who are these people?

I suppose its the we that's not me.

~~~
chadmalik
There's a fairly large debate going on about using fiscal/monetary stimulus
(Keynesian) vs. no stimulus (Austrian). It's not just eggheads, almost
everyone following the economic scene is discussing this issue ATM....FWIW I
think we need some fiscal stimulus in the form of public works projects ;)

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ergo98
What a bizarre article.

Firstly, most hedge fund managers are very socially capable and convincing,
which is how they manage to get other people to invest with them. The Bernie
Madoff's of the world aren't hidden in a basement. I really, really don't get
the "geekish" angle around hedge funds.

Secondly, many hedge funds have been doing _great_ during this economic
turmoil. Hedge funds make money during turmoil. That's their bread and butter.

~~~
sprout
I think you may need to re-read the article. There's one line in there where
he almost says what you think he said:

>The social butterflies at the banks got swept up in the popular enthusiasms.
The contrarians at the hedge funds made money betting against them. The well-
connected bankers knew they’d get bailed out if anything went wrong. The
solitary hedge fund guys knew they were on their own and regarded their trades
with paranoid anxiety.

But I think he pretty clearly regards hedge fund managers as 'princes,' not
'grinds.'

~~~
ergo98
"Grinds, on the other hand, tend to have started their own company or their
own hedge fund. They’re often too awkward to work in a large organization and
too intense to work for anybody but themselves. "

"During the last few years, for example, the princes at Citigroup, Bear
Stearns, Goldman Sachs and Lehman Brothers behaved with incredible stupidity
while the hedge fund loners often behaved with impressive restraint."

In the section you quote he was directly contrasting them - grinds versus
princes.

He clearly thinks hedge fund guys are anti-social geeks, which is nothing
short of bizarre. I work in the hedge fund industry, dealing with a lot of
hedge funds. Such an observation is incredibly off the mark. Many of the hedge
fund guys not only have great social capabilities, they have _so much_
confidence that they didn't want to be a grind at a place like Citibank, so
they went on their own.

Article is 180 degrees backwards from reality.

~~~
yummyfajitas
I work at a hedge fund, and have interviewed at a number of others. Most of
the places I've spoken to are run by a "grind", though they often have a
"prince" to talk to the outside world. Depending on _which_ fund managers the
author spoke to, I can easily see him getting the impression that hedge funds
are run by grinds.

Or, probably more precisely, that the world of hedge funds has a place for
grinds, whereas the world of big banks does not.

(Admittedly, my experience is skewed since I generally targeted small quant
funds, ideally without customers.)

~~~
eru
"Without customers", do you mean operating solely on proprietary capital? Or
does it mean "no customers, yet"?

(Please pardon my ignorance in this matter.)

~~~
yummyfajitas
It means "trading their own money". "No customers yet" is actually worse than
having customers, since you need to worry about actually finding them in
addition to making money for them.

~~~
eru
Thanks. I was just a bit confused by the wording. The last finance person I
talked to, made much of the difference between `hedge-funds' and `prop-shops'.

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chadmalik
Clearly the author missed the recent carried-interest battle where Congress
(absurdly) allowed Hedge funds and VCs to continue to be taxed on their
guaranteed yearly management fees as if they have made a capital gain. I
wonder if he reads his own newspaper?

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GFischer
I really don't understand the author's position.

And it's also a very loaded link, should have the libertarians out of the
woodwork.

I'm not sure if it belongs in Hacker News though (I'd love to discuss it, but
it doesn't seem the right forum for it).

Edit: I'd like to know why you disagree with me.

My take on the article:

It differenciates between

"Grinds" (I take them as the "enterpreneurs", the Randian Hank Reardens if you
will)

and

"Princes" (which I take as the "cronies", "old-boys networks", etc)

He states that "princes" are more interesting to be around and other
subjective stuff, but then goes on to the meat of the article IMO:

he realizes it's the enterpreneurs and small businesses that drive the economy
- "For jobs to recover, the grinds have to recover"

and that it's largely the government's fault (and banks, etc): "it’s hard to
see how that will happen so long as households are still so leveraged,
government debt is still so unnerving and the business climate is still so
terrible for entrepreneurs."

so he wants the "grinds" to redouble their efforts: "how we are going to light
a fire under the country’s loners, its contrarians and its narrow, ambitious
outsiders"

yet he doesn't seem to realize it's the gov't and the "princes" which hinder
the "grinds"

