
An open letter to Paul Graham - MarlonPro
https://medium.com/@RickWebb/an-open-letter-to-paul-graham-3d4f3369fe76#.69wt9xmbz
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SomeCallMeTim
Between this essay and the one I saw on HN over the weekend [1], I feel PG
really got this essay wrong.

Both response essays have really compelling points, and even as I read PG's
original, I felt like he was catastrophizing.

Something that none of the above mention is that, as "job eliminators," we
need to start considering how to keep the people who have no chance at a job
can continue to live reasonable lives.

California, despite being the home of Silicon Valley, still has "truck driver"
as the most common occupation as of 2014. [2] In ten years we'll probably be
seeing the first self-driving trucks; in 25 the occupation will likely be gone
for any runs that don't require humans to unload the truck at the other end
(home or small commercial delivery drivers, movers, etc.; a lot of trucks just
move goods from one manned loading dock to another).

Before you say they'll work at some new job, what other jobs at that skill
level won't also be automated by that time?

We need a serious movement toward guaranteed income. Capitalism needs
consumers; if most of the population can't get jobs, who will be the
consumers? And what will happen to those people? Without guaranteed income,
they'll be desperate; I don't exaggerate in suggesting that the poor will
eventually get to the point of trying to overthrow or attack the rich. A brief
look at the fall of various past civilizations will reveal many parallels, and
even if the rich _could_ sufficiently arm themselves to resist, living in
cyberpunk-style walled enclaves, that's not a future I would want to live in.

Making sure everyone has enough to live a decent life is the only path I can
see to a humane future.

[1] [http://cryoshon.co/2016/01/02/a-response-to-paul-grahams-
art...](http://cryoshon.co/2016/01/02/a-response-to-paul-grahams-article-on-
income-inequality/)

[2]
[http://www.npr.org/sections/money/2015/02/05/382664837/map-t...](http://www.npr.org/sections/money/2015/02/05/382664837/map-
the-most-common-job-in-every-state)

~~~
pc86
On the surface I want to support BI, I really do. But how does it work other
than as a _replacement_ (not supplement) to existing social welfare programs?
Give someone enough money that they can rent a room, buy food, and cover their
healthcare (whatever cost that may incur). The numbers required to do this in
the US when you eliminate all social programs seem doable. Most people pay
less in taxes, money gets distributed directly to the people, and it seems
fine.

So what happens when someone uses their entire BI allowance on Fireball and
lottery tickets? The two choices seem to be "they die" or "we don't actually
eliminate social service in exchange for a guarantee BI."

~~~
mikeyouse
The BI proponents typically forget that there's some average amount of money
that would work for everyone, but there is clearly a power-law at the
expensive end of social services.

As an example, I have an extended family member who was born happy and healthy
but contracted meningitis at 5 years old and was severely mentally handicapped
afterwards. For the past 20 years, his parents have provided his extensive
care buoyed by social security disability, but they won't be around forever,
so then what? Giving him or some agent on his behalf $12k/year isn't going to
come close to paying for the level of support that he needs.

There are millions of people in similar situations that could not survive
without significant amounts of money which is almost entirely funded by the
government. Just assuming that this will be covered by any basic income is
silly.

~~~
pc86
So at that point it basically becomes a "you only get BI unless you need
more," which is really just what we have now but everyone gets a $12k/yr
kicker on top, right (to use your figure).

~~~
SomeCallMeTim
Throw in single-payer to cover health issues ( _and_ include mental health
issues) and you'll cover 98% of the problem.

People play PowerBall to extremes and similar because they're desperate.

I doubt $12k/year would be sufficient, BTW. You want people to be able to live
a decent, if spartan, life on BI, and at $12k I think they'd be forced to
decide between starving or extremely poor living conditions.

Probably $18k/year would be an absolute minimum, plus allowances for kids (how
to handle kids is a HUGE question, well outside the scope of this post).

The amount you earn could vary by chosen living area, in proportion to living
expenses. Maybe not 100% proportionally; if an area has 150% of the cost of
living, but only pays you 125% more than the nominal amount, there would still
be a pressure to move to less expensive areas, but more expensive areas
wouldn't de facto exclude people on BI.

There needs to be extended discussion on the details. I don't know nearly
enough to be able to have all of the answers. But it seems like the answer is
out there, if enough people get together to work on it.

------
murbard2
> The crux of your argument — that “Ending economic inequality would mean
> ending startups” — is both a straw man (no one’s advocating eliminating
> income inequality completely) and untrue (people can still pursue whatever
> they want — they just have to pay more taxes on it.)

Will you get a 80% tax rebate on your opportunity cost if your startup, as
most do, fails? Of course not, which means you've dramatically shifted the EV
of the proposition.

------
Rainymood
>In the real world you can create wealth as well as taking it from others. A
woodworker creates wealth. He makes a chair, and you willingly give him money
in return for it. A high-frequency trader does not. He makes a dollar only
when someone on the other end of a trade loses a dollar.

But wait a second, the woodworker doesn't get the wood from something? Which
happens to be a natural resource? So he's just siphoning wealth from the earth
to his own pockets (by adding some more value).

~~~
AnimalMuppet
You could argue that the _woodcutter_ is "siphoning wealth from the earth to
his own pockets". Or, you could say that the woodcutter is getting paid for
his labor.

But the woodworker buys the wood from the woodcutter, rather than cutting it
himself. He creates wealth by making a chair that is more valuable than a
block of wood.

And I would say that "siphoning wealth from the earth to his own pockets" is
antithetical to "adding some more value".

------
golemotron
> Literally no one in America, save for a very few on the fringe, is talking
> about “eliminating income inequality.” People are seeking to and talking
> about reducing income inequality.

This is disingenuous. On social and mainstream media the issue has been framed
as "income inequality is a problem" not "excessive income inequality is a
problem."

~~~
jrock08
Unless you are trying to be obtuse, or hate brevity, the statement "eliminate
income inequality" and "eliminate excessive income inequality" read exactly
the same. No one is arguing for a move to a fully socialist state, so
"eliminate income inequality" in the US means "tax the highest bracket more"
and/or "add a higher tax bracket and tax it more" and/or "add a wealth tax".
If you honestly look at the arguments rather than just arguing petty semantics
you'll be better off in the long run.

------
aminok
Paul Graham is absolutely right, and those who argue against him are doing so
from a position of close-mindedness.

First of all: it's irrelevant to the principle whether the goal is to
"eliminate" income inequality, or "reduce" it. This being HN, I won't
elaborate on why. This place should be above pedantry and people coming from
all viewpoints should be able to see why it's the case that if one is bad, so
is the other.

Second, Graham is not arguing that the pie is getting larger. He is saying
that the type of capitalistic market-based activity that increase income
inequality also increase the size of the pie. Sure a new regulation that
increases legal fees for the average person but increases the wages of highly
educated legal professionals will be a zero sum reallocation of the shares of
each slice, but that is not what PG is talking about when he says he's in the
business of creating income inequality.

~~~
jrock08
It's not clear that reducing income inequality is bad, please explain. The
arguments against eliminating income inequality rest on the idea that people
won't do a hard or bad job if it didn't pay more than other easier or nicer
jobs. While there are very likely jobs that people wouldn't do for a small
multiplier on some ideal base pay for some ideal good job. Increasing marginal
tax rates, which is the actual way that actual people suggest we handle income
inequality, doesn't actually put a cap on pay.

~~~
aminok
I'm not going to rehash PG's entire article. Feel free to address all of the
arguments in it so we can avoid an endless, unconstructive merry-go-round.

~~~
jrock08
And I'm not going to point-by-point refute arguments that aren't particularly
convincing, but here's some thoughts.

> Closely related to poverty is lack of social mobility.

It's not just closely related, when considering income inequality the two
converge. It's simple arithmetic really. When poverty wages are a lesser
multiplier (i.e. income inequality were less) of wealth wages (let's say 2),
then it's obvious how to lift oneself out of poverty, split a home with
another person earning an income.

> you don't have to grow up rich or even upper middle class to get rich as a
> startup founder, but few successful founders grew up desperately poor

Sure, but a rich founder has a clear advantage, in the same way that a founder
at Harvard has a clear advantage. It's a lot easier to ask a
friend/colleague/parent for money than a stranger.

> For example, let's attack poverty, and if necessary damage wealth in the
> process.

Yes. The way we attack poverty is to spend money to improve schools, spend
money to improve transit, spend money to provide food for low cost. Where does
that money come from, taxes. If we just talk about fixing poverty, we run the
risk of not actually spending money and fixing the problem. Ignoring the
greater context of politics, and the almost 100% sign on of republicans to the
Grover no new taxes pledge, in order to actually get a mandate to fix
anything, the alternative has to be upfront and direct about taxes.

If you'd like me to address arguments directly feel free to respond with
something less dickish than telling me to read an article that I've already
read.

~~~
aminok
>Sure, but a rich founder has a clear advantage, in the same way that a
founder at Harvard has a clear advantage.

PG didn't suggest otherwise. He didn't say that wealth doesn't beget wealth.
He said the absence of it does not prevent one from generating wealth.

He's not arguing against the idea that entrepreneurship contributes to income
inequality. He is saying that the manner in which it produce income inequality
is not harmful to society, because incomes are becoming more unequal by
individuals generating wealth, and not by siphoning existing wealth that
others have.

This is just example of how you misinterpret his arguments in a mad rush to
defend economic orthodoxy.

~~~
jrock08
Could you please respond to my whole comment rather than cherry picking one
thing I said.

> wealth doesn't beget wealth

The return on an investment in the S&P 500 over the past 50 years undermines
this.

> absence of it does not prevent one from generating wealth.

Prevent is such a strong word. I'm not technically _prevented_ from breaking
the longest free-fall record. However, I do not have 1000s of skydives under
my belt or connections in the community of record breaking skydiving. While
I'm not technically prevented from getting those things, I'm behind the curve
compared to someone that has those things.

> the manner in which it produce income inequality is not harmful

But he doesn't really present any real evidence that this is the case. Now, I
agree, that some startups produce new wealth as some percentage of the wealth
that their founders, investors, and employees reap. But it's obviously always
more complicated than that. Take, for example, the Microsoft office suite,
which by almost any measure created an immense amount of wealth. However, it
also made a large number of jobs obsolete, and thus "redistributed" the wealth
from people working typist style jobs. Take for example, smartphones, which
again, have created an immense amount of wealth. However, they also allow
smaller independent contractors who would otherwise have rented an office
space, and hired a secretary, to simply use their smartphone to manage their
day, thus "redistributing" some amount of wealth from a lower-middle class job
to an upper-middle class job. Now, obviously, I've ignored that maybe, the
loss of these jobs created new jobs that the workers who were displaced could
do, but given that PGs argument was basically just "We make the pie bigger"
with almost no evidence, my argument of "It's really not that simple" with
some examples should be at least equally convincing to you.

