
What happens when a culture is driven by the need for money to make more money - JMiao
https://medium.com/@ystrickler/resist-and-thrive-1d36819853ca
======
leelin
I used to wonder why Midtown Manhattan had so many bank branches, especially
the redundant branches a mere block or two away. How could that be the highest
and best use of prime commercial store frontage in a competitive market?

I figured out in 2009, when I was working at a hedge fund trying to bid on the
assets of bankrupt banks post financial crisis.

Basically, every branch loses money to gain depositors. All the fees on
monthly accounts, safety deposit boxes, ATMs, cashiers checks, etc. do not
offset the cost of the office and employees. However, if the loss is small
compared to the volume of deposit money the branch attracts, then the bank
headquarters has "borrowed" money at a very low cost.

I think a typical suburban Countrywide or Washington Mutual branch was losing
about $100K/yr but had deposits of $20M; not bad at all considering Fed Funds
had been around 5.25% until fall of 2007, and that having the capital was the
life blood necessary to do all the profitable operations (originating
mortgages, credit cards, student loans, EDIT: meet regulatory capital
requirements, etc). In Midtown, those numbers might be multiplied many fold,
so very few retail stores can compete and stay profitable.

~~~
nostrademons
I thought it was pretty well-known that you're the product of a bank, not the
customer. I don't pay _any_ fees to my bank (my balance is high enough that
they waive them all), and they actually pay me some miniscule interest rate.
But in return they get to use my savings to make loans on high-priced
mortgages and credit cards, which earns them literally thousands in interest
charges.

Retail banking locations are a market-share grab. They want to make it as
convenient as possible to put your savings in a bank, because then they have
access to your deposits, which can be loaned out as a lucrative product.

It's much like the Chrome Omnibox or Google Toolbar for Google, or the
Facebook mobile app. These derive no revenue, but they make it as convenient
as possible to use the company's products. That user attention can then be
sold to advertisers for a nice profit.

Ditto Hacker News as well - your comments here don't benefit YCombinator at
all, and they have to spend money maintaining & moderating it. However,
insightful comments on HN attract intellectual people interested in startups,
which are YCombinator's prime customer demographic, and so your contributions
here are effectively very cheap advertising for YCombinator.

~~~
titzer
The real reason they want depositors is fractional reserve banking. If you
deposit $1, they can go borrow $10 from the federal reserve, loan it out, and
be making interest on $10 of created, loaned money.

~~~
laotzu
According to the Fed's website, commercial banks (including
foreign/international banks) can actually create and loan out up to
$14,500,000 per loan and not be required to have anything backing it (0%
required reserve ratio).

[http://www.federalreserve.gov/monetarypolicy/reservereq.htm](http://www.federalreserve.gov/monetarypolicy/reservereq.htm)

~~~
rahimnathwani
Totally wrong. That document is not about loans. It doesn't even mention the
word 'loan', except in the context of 'savings and loan associations'.

The document is about reserve requirements for _deposits_. Roughly speaking,
if a bank takes in $100MM of deposits, it has to keep 10% of that ($10MM) in a
way that's easy to access (either as cash in a vault, or as a deposit at the
central bank). That way, if a depositor wants their money back, the bank will
probably be able to give it to them.

If a bank has _total_ deposits of less than $14.5MM, then the reserve ratio is
0%, instead of 3% or 10%.

~~~
laotzu
Loans are created as deposits/accounts receivables which are included in net
transaction accounts. Back that loan with a Credit Default Swap and you cant
skirt any reserve requirements which was exactly what ripped the world economy
in 2008.

~~~
rahimnathwani
This doesn't make any sense. When a bank creates a loan of $X and disburses
the loan into the borrowers account, two things happen:

1) The bank's loan assets go up by $X 2) The bank's deposits go up by $X

Deposits are part of 'net transaction accounts'[0] so the bank would now need
to hold 10% of $X in additional cash (e.g. in their vault).

So, it seems like the bank can create a loan of $X with just $0.1X of cash.
Hang on, though. This assumes that the borrower just keeps the money in his
bank account, which is unlikely. When she withdraws the money to spend it, the
bank's reserve requirements go down by $0.1X (good) but they also need to pay
out $X of cash (bad). So, it really did cost them $X to make $X of loan.

Now, if they have a CDS related to this loan, then they are insulated from the
risk of default. But, how is that relevant to reserve requirements?

[0] "Net transaction accounts are total transaction accounts less amounts due
from other depository institutions and less cash items in the process of
collection."

~~~
laotzu
I'm confused myself but thanks for debating. I was wrong about the 0% reserve
ratio applying per account rather it is the sum total of all accounts held by
the bank.

------
hliyan
I've recently come to the conclusion that any society where it is easier for
the rich become richer than it is for the poor to become richer, regardless of
its starting state, will tend toward feudalism over time. While modern day
America is starting to look more and more like a data point that supports this
conclusion, I'd like to think that there's a certain amount of mathematical
certainty involved too:

    
    
        money => more money ------- (1)
        money <=> power ----------- (2)
    

(1) and (2) over time will result in the bifurcation of society into two
groups: the rich and powerful, and the rest. This probably doesn't apply to
corporations though.

~~~
JonFish85
What I don't get about this argument (and others similar to it) is that the US
seems to have a pretty good turnover of money. According to Forbes'
billionaires list, "[f]ully 1,191 members of the list are self-made
billionaires, while just 230 inherited their wealth"[1]. The top 3 richest
people on the planet at this point made their money themselves, and 2 of them
(Gates & Buffett) are not going to pass their wealth down the family tree.

We're less than 100 years from one of the richest people of all time, JD
Rockefeller (net worth ~$300+bn). His family is essentially dedicated to
giving that money away at this point, and I believe the family's net worth at
this point is in the $15bn range--not peanuts, but hardly growing.

Money doesn't last, but there are always rich people. Paris Hilton, trust fund
baby, has made more money from her own businesses than she'd ever inherit from
her grandfather. Same with Julia Louis-Dreyfus. But after a couple of
generations, the old money is usually gone. As much as people like to complain
about "the rich", there really aren't as many generationally-rich people as
some make it seem.

[1] [http://www.forbes.com/sites/kerryadolan/2015/03/02/inside-
th...](http://www.forbes.com/sites/kerryadolan/2015/03/02/inside-
the-2015-forbes-billionaires-list-facts-and-figures/)

~~~
FD3SA
The good old "Bill Gates the bootstrapped college dropout" argument. These
myths never die.

William Henry Gates the Third had a trust fund before he was born. His
downside risks for anything he chose to do in life were completely
nonexistent. Same with Zuck. Same with Spiegel. Same with 99% of the
entrepreneurs HN idolizes.

Here's some light reading:

[http://qz.com/455109/entrepreneurs-dont-have-a-special-
gene-...](http://qz.com/455109/entrepreneurs-dont-have-a-special-gene-for-
risk-they-come-from-families-with-money/)

[http://philip.greenspun.com/bg/](http://philip.greenspun.com/bg/)

EDIT: Removed potentially inflammatory line, which went as follows: "Just a
bunch of rich kids trying to prove a point to their parents".

This is definitely a personal opinion, but one that has merit if you examine
the evolutionary psychology of parent-child relationships. The conversation is
a bit in depth, but please understand that I was not trying to simply fire off
an ad hominem. I was instead trying to hint at the incentives which drive an
already rich child to strive for more wealth. For the vast majority of us who
have to work for a living, such behaviors seem confusing. Only upon deeper
analysis do the pyschological incentives for such individuals begin to make
sense.

~~~
drumdance
_It 's a bunch of rich kids trying to get richer than their parents to prove a
point._

You had me until there. Why question their motives? Is it really so hard to
believe that Gates really loved computers?

If he was just thinking in terms of outstripping his parents, there were lots
of other more-credible avenues available to him. The very idea of a personal
computer was scoffed at. Not just by non-techies, but people like DEC founder
Ken Olsen.

~~~
Anechoic
_Why question their motives? Is it really so hard to believe that Gates really
loved computers?_

Did Gates' love of computers motivate Microsoft's anticompetitive moves in the
1990s?

~~~
drumdance
I don't see what one has to do with the other. Professional athletes get
caught cheating all the time, but I don't doubt they still love their sports.

One may as well doubt that Hitler actually liked being a vegetarian.

~~~
Retra
It's a funny way of showing love to a sport when you subvert the rules that
make it fair. No doubt if everyone cheated all the time, practically nobody
would love the sport.

One may as well think that Hitler eating meat remains a vegetarian.

~~~
drumdance
_It 's a funny way of showing love to a sport when you subvert the rules that
make it fair._

Uber and AirBnB are subverting rules and breaking laws in hundreds of
municipalities. Do you think they don't care about what they're building over
there? Is it just money-money-money and no serious interest in technology?
Does that mean, by proxy, that Paul Graham only cares about money?

Is it really so hard to believe that people can have more than one thing that
motivates them? Why did Ray Ozzie join such an evil beast? Surely he's just
motivated by greed!

Black and white thinking will be the death of us all.

~~~
Retra
I don't know where you got black and white thinking from. I wouldn't say Bill
Gates doesn't love computers, just that he loves something else more.
Something that may very well not be good for computing.

Uber and AirBnB? Do they love the work they do? Maybe. But they love
themselves more. They love the idea of being "disruptors" or "innovators" or
"rich" more than they care about transportation, housing, or their customers.

And those guys who love sports? Maybe they love winning more.

It's easy to feign passion, after all. Especially when you're already
committed to investors.

~~~
drumdance
I like to accept what people say at face value until evidence suggests
otherwise.

People go on about Bill Gates and antitrust, but do they really think Steve
Jobs or Scott McNealy or even Page & Brin would behave differently?

Bill Gates' biggest fear was _not_ losing the OS monopoly. His fear was of
Microsoft turning into IBM -- always having to run everything you do by
lawyers.

MS-DOS wouldn't even exist if IBM hadn't had the justice department watching
their every move.

~~~
eli_gottlieb
And Microsoft wouldn't exist if the Bush Administration hadn't ordered their
monopoly conviction pardoned.

------
codingdave
" 'I might delete Facebook today.', 'I’ll go back to my Razr phone.', 'Maybe
I’ll try homesteading.' But to do any of these means becoming a ghost to your
community."

As someone who has deleted Facebook and moved to our own small homestead, this
is totally untrue. On the contrary, I live in a much more vibrant community
now, as I barter with the neighbors, trading our eggs, dairy, and honey, for
whatever they have/do. I know almost every single person who lives near me. We
hire their kids to help in the summers. A few women hang out at our place
every Tuesday and knit. We have friends come crash with us for weeks or months
at a time, exchanging room and board for helping around the homestead. And I
work from home, ironically making more money than I did when working in an
office. (Although I actually save less because I keep building chicken coops
and solar arrays, etc.).

In any case, I feel far more connected to my local community now than I ever
did before we started this lifestyle.

~~~
j-b
Sounds really cool. Where do you live?

~~~
codingdave
Central Utah - check back a month or so in my comment history and there was a
more detailed discussion about all this...

------
powera
What a load of BS. To just pick on one point:

* There are only 250 Duane Reade's total (according to Wikipedia), there can't possibly be 400 in Manhattan.

* Duane Reade as a chain is intricately associated with the city of New York, at least from the point of view of a San Franciscan. It _is_ the local culture.

* What's wrong with not having to walk a mile to go to a drug store? Having more locations helps build smaller neighborhoods.

Nobody grows up wanting to own and operate their own drug store anymore. So
chains do it instead.

And I don't see how this is different than 50 people opening their own
boutiques and destroying neighborhoods through gentrification. But I'm
guessing the author would have a different opinion on that.

also: this is the CEO of kickstarter? Isn't it _slightly_ self-serving for him
to say "people should be trying their own crazy things that they could never
get money for before kickstarter"?

~~~
alvarosm
And don't forget the hypocrisy of bashing money-worshipping, when Kickstarter
(which is now a for-profit corporation, by the way) is run by profit-
maximizing algorithms. Strickler sounds like the typical caviar socialist.

~~~
eevilspock
_We want Kickstarter to be similarly in sync with society. Earlier this year
we became a Public Benefit Corporation. This means we are legally obligated to
consider the impact of our decisions on society, not just our shareholders.
It’s very different from the expectation that for profit companies maximize
shareholder value above all. It acknowledges and embraces that you are a part
of a larger community._

Right there in the article.

~~~
alvarosm
"In the United States, a benefit corporation is a type of _for-profit_
corporate entity, authorized by 30 U.S. states and the District of Columbia[1]
that includes positive impact on society and the environment in addition to
profit as its legally defined goals. Benefit corporations differ from
traditional C corporations in purpose, accountability, and transparency, but
not in taxation."

~~~
shoo
Perhaps clearer language to use here might be the distinction between "for
profit" and "solely for profit".

------
j2kun
I like the message, but I also think it cuts both ways.

Take Chicago for example. When I moved to Chicago five years ago, Wicker Park
was the "hipster" neighborhood, where many of the exciting cultural events (at
least for people in my age group, young 20 somethings) were happening. By the
next year, Wicker Park had become too trendy and gentrified, and all the
hipsters moved further west to Logan Square. Today Logan Square is too
upscale, and the hipsters have moved south into Pilsen, forcing many of the
local hispanic families out of the neighborhood because of rising prices. Now
there are organic juice bars sprouting up in Pilsen and the gentrification
process is starting anew.

This is almost exactly the pattern described in the article, except it's the
people who _want_ authentic communities that are causing the problem! It's a
catch-22: if you don't like your community you can try to go elsewhere, but a
few years after you do you will hate your vapid community again. In this case
it's the drive for culture that causes monoculture. Once something is seen as
authentic people flock to it and it becomes trite. How can you deal with that?

~~~
m_mueller
Maybe the question that should be asked is why a large part of the population
can't afford to live in a hip place in town, so what's left at the end is only
rich people and banks. I think there's two aspects to this: (1) Income
inequality and (2) smart zoning laws. I think (1) has been discussed ad
nauseam but for (2) see Japan as an example:
[http://urbankchoze.blogspot.jp/2014/04/japanese-
zoning.html](http://urbankchoze.blogspot.jp/2014/04/japanese-zoning.html).

I live in Tokyo and I have to say - while there is still the business district
that noone can afford and the gentrification process is somewhat visible in
some places (however IMO slower than elsewhere), it's really not too hard to
live in a place with lots of small business, shops, nice restaurants and
locals to talk to. We pay <1000$ rent and have a three small supermarkets, ~15
good restaurants, 2 train stations, a recreational park with big pond and all
kinds of small shops do get whatever supply you need, all within 10min walking
distance. And this place is far from exceptional in Tokyo, this city is
basically a huge spread of small towns grown together and connected with a
train system on steroids. And I think zoning laws is probably one of the most
important influences on why this happens - basically you can build an
expensive house, a cheap apartment building, a restaurant, a medium sized
supermarket, an estate agency and a fish tank supply shop all in the same
block here - and that's also what actually happens. I've never seen this sort
of chaotic mix in Europe or the US, but I think this is exactly what you need
for a thriving community that stays this way.

~~~
j2kun
Well the problem starts right after the hipsters move in, because they
displace the local families. At least this is the current concern being voiced
by those in Pilsen.

------
thaumaturgy
This message is unlikely to reach the people it most needs to reach. It's hard
enough to change anyone's religion; harder still when their religion is money.

It causes weird effects. In my area -- and in a number of other more rural
communities I've visited over the last year -- there are still tons and tons
of empty commercial spaces, staying empty for months (or years), all with "For
Lease" signs in the window ... and all of them with absurdly inflated asking
rates. For those whose god is "the market", there's a failure happening here
that's directly affecting the ability of smaller businesses to start up or
grow.

~~~
nickbauman
David Graeber's _Debt, The First 5,000 Years_ ideas on this can be summarized
that around 1500 or so, money gained autonomy from the leviathan. Where it
once mattered that you could use money to get things and use things to get
money, but when money is used only to get money, things go berserk.

The result was someone like Cortez could conquer Mexico, gathering all the
gold there was to be had, even enslaving thousands to work in mines, murdering
thousands more by working them to death, and still be completely broke. Cortez
was _capitalized_ at a rate point where he could never break even.

~~~
littletimmy
Wait what is this about Cortez not being able to break even due to
overcapitalization? It sounds really interesting. Would love if you could
point me to a source where I can read more about this.

~~~
quadrangle
The poster you're replying to specifically referenced a book that discusses
this and related topics, with tons of citations. You should read it, it's an
amazing, important book.

------
mbrock
I appreciate the analysis and sentiment but when looking at graphs of extreme
net worth inequality it seems pretty pointless to just advise sympathetic
people to "not sell out."

People who will take that advice to heart will just end up not being the
extremely rich people, and other people will end up there instead.

It's good to increase the number of CEOs and powerful people who remain
committed to values that benefit everyone. Still, without systemic change, the
extremely rich and sociopathic will continue doing what they do, and extremely
powerful corporations and banks will stay extremely powerful.

~~~
tdaltonc
I totally agree "do the right thing" is a special case of "just try harder".
And "Try harder" is the solution to nothing. You have to change the system to
make what-you-want-to-see the natural output of the system.

~~~
circlefavshape
... and I think you'll find that "changing the system" is pretty much
impossible. The world is not created, the world evolves. The best you can do
is try and apply a selection pressure

~~~
ZenoArrow
Your best bet isn't to 'change the system' if dramatic change is needed, your
best bet is to create a parallel system that people can buy into gradually.

------
7Figures2Commas
> In New York City, many of the businesses that move in are banks. There are
> more than 1,800 bank branches in New York — 60% more than there were a
> decade ago.

There was an article about this in the Wall Street Journal last year[1].
Excerpt:

> But why open a branch on every corner? The blame, it turns out, lies with
> us. We're asking for it.

> TD, which has more than 1,300 branches in cities up and down the East Coast,
> conducted a customer survey and discovered that, compared to the rest of the
> nation, New Yorkers are obsessed with branch convenience. While folks in
> other towns value frivolities like friendly service, New Yorkers more often
> rank convenient ATMs and branches a top priority. They want locations near
> their homes, their offices and the offices of their spouses, says Mr. Giamo.
> They want to see their bank everywhere they go.

When it comes to the subject of community, a lot of people don't want to
accept that communities are dynamic. The ways in which they change are almost
always driven by the needs and wants of the people in those communities, even
though you will always find vocal people in those communities who swear that
can't be the case.

[1] [http://www.wsj.com/articles/all-those-banks-in-new-york-
city...](http://www.wsj.com/articles/all-those-banks-in-new-york-city-its-our-
fault-1402100947)

~~~
m-i-l
Interesting to read that the number of bank branches is actually increasing in
New York. In the UK the opposite is happening as more and more consumers are
doing their banking online: "the UK has lost a quarter of its retail bank
branches over the past ten years" (650 estimated closures in 2015, 500 in 2014
and 222 in 2013) [0]. Many of the closed banks are turned into bars, see [1]
for some nice examples.

[0]
[http://www.finextra.com/news/fullstory.aspx?newsitemid=28007](http://www.finextra.com/news/fullstory.aspx?newsitemid=28007)

[1] [http://www.bbc.co.uk/newsbeat/article/29801667/see-the-
pubs-...](http://www.bbc.co.uk/newsbeat/article/29801667/see-the-pubs-that-
were-converted-from-old-bank-branches)

~~~
walshemj
Yes that struck me as odd as well uk banks are shedding staff and closing
branches.

You would have expected the same to play out in the USA.

------
maloney
If your money does not make you money, you are losing money. This article
neglects inflation and monetary policy completely.

There are more banks then ever, because it's more profitable to be a bank than
ever before. We have had almost an entire decade of 0% interests rates
allowing banks to make incredible sums of money.

~~~
titzer
Inflation is driven by monetary policy and both are symptoms of the exact same
systemic problem he is describing. Inflation is a side-effect of increasing
the money supply in order to generate more trade. More trade does not equate
to more wealth or more goods or a higher standard of living.

~~~
hammock
According to the view generally accepted in economics, more trade absolutely
equates to more wealth.

"In every voluntary exchange we give up something we value less than what we
receive... and so does the person we are trading with. Trade benefits both
parties and this benefit is an increase in wealth for both."

[http://www.fte.org/teacher-resources/lesson-
plans/rslessons/...](http://www.fte.org/teacher-resources/lesson-
plans/rslessons/the-magic-of-markets-trade-creates-wealth/)

~~~
titzer
1.) There are a whole lot of involuntary transactions in real economies. 2.)
The argument only applies to perceived value, not wealth. Wealth is objective
and measurable, e.g. the number of houses or cars or widgets in existence.

------
disantlor
Within the last year multiple bank branches has opened with in a 5-10 block
radius of my apartment in Brooklyn. I never see people in them, literally I
have never seen anyone besides the employees gazing out forlornly at people on
the street. They take up huge amounts of space and and are extremely bright
which makes them oddly depressing at night.

Gentrification arguments aside, I'm confused because they don't seem to have
customers (and again there are multiple) and certainly that will only be more
true as younger people have less and less connection to the physical bank
branch.

~~~
indymike
Just was in a bank in a nice neighborhood in Indianapolis. Asked the banker
how it stayed open with little traffic. His answer is that the branch was an
asset it could be leveraged to allow the bank to loan more money.

~~~
yourapostasy
Can someone in the retail financial services industry familiar with their
regulation please clarify this assertion?

It almost sounds as if there is some rule that allows a bank to open a retail
branch, declare that branch an asset and simultaneously expand its loaning
capacity, then use that loaning capacity elsewhere (like its trading arm).
This is a variation on the old 80-90's Japanese corporations using real-
estate-as-asset-securing-loans bookkeeping: at some point someone notice that
they could pledge real estate the company owned as collateral to secure loans
that could be leveraged into more real estate for more loans, and then churn
the real estate holdings in a up-trend market and rinse-repeat for even bigger
loan packages.

Even in a post-Gramm–Leach–Bliley world that repealed Glass–Steagall, it
stretches my credulity to believe that even lax bank regulation would allow
branch openings at a completely speculative stage (with no proven loan
activity yet) to partly drive bank loanable reserve levels. I'm more inclined
to believe that these branches don't see a lot of foot traffic in the Net era,
but that they justify their cost by sporadically serving customers in a local
market who already hold loan products serviced by the bank, and need an
occasional in-person visit to the bank.

~~~
debacle
Maybe he meant that the building itself and the land it was on, rather than
the business of the branch, was the asset.

~~~
yourapostasy
I thought of that possibility, and discounted it while posting, because I
thought the bank would make more ROI, and have more loanable reserves under
that assertion, if it straight commercially leased the space instead of
putting a branch on it. Or land banking the land instead of putting a
relatively specific-purpose improvement on the land. Branch buildings in the
US commonly have drive-thrus, which are not easily re-purposed for other kinds
of businesses, thus subtracting some profitability on the back end of the land
banking for demolition or modifications. I'm not in the business or anywhere
close to that kind of business though, so I'm hoping someone familiar with
what goes into these branch building decisions pipes up here.

------
myth_buster
Evidently, Capitalism needs to be hacked.

_For Profit_ doesn't cut it and is buggy. The side-effects are the waste due
to consumerism, unsustainability and potential application crash (climate &
earth).

The variables in the model needs to be tweaked so a new system evolves.

~~~
gtpasqual
No

Capitalism's been 'hacked' and that's why you have consumerism and
unsustainability.

The free-market is the most effective way to distribute resources in an
environment, that's it. All problems come from central planning.

~~~
thescriptkiddie
I honestly can't tell if you're being sarcastic or not.

~~~
vezzy-fnord
That free markets ensure a Pareto optimal allocation of resources is the first
fundamental theorem of welfare economics. It does not imply any _normative_
statement on whether the distribution is "just", as that is very difficult to
qualify.

~~~
thescriptkiddie
There's quite a bit of difference between pareto optimal and "most effective".
In many situations, pareto optimality is actually among the worst of all
possible outcomes (see the prisoner's dilemma, also local maxima). If you had
used the former term in your comment it would have been more clear. As it is,
it reads like a deliberate attempt to invoke poe's law.

EDIT: Oh wait, you're not the same person.

------
div0
The sad thing about changes brought by money and for money is that we don't
have a community anymore. We don't even know what it looks and feel like. I
honestly want to find such a place to live and raise my kids haven't found an
example of it anywhere (in US)

~~~
tyrust
>haven't found an example of it anywhere (in US)

[http://www.mrmoneymustache.com/2015/08/19/urban-
tribe/](http://www.mrmoneymustache.com/2015/08/19/urban-tribe/)

Note that I'm not an expert in the field nor do I consider myself part of a
community. I'm just giving an example where you've asked. I'm sure there are
many more examples out there.

------
ilaksh
Money is actually a very powerful technology. I hope people will start to
think of this as a high-tech problem. We can improve the concept of money.
Seems like a lot of people think the answer is just to give it up. But that is
simplistic and discounting the power of a universal trading system.

I think the answer is to really understand how money functions in our society
and the parts that work and the parts that don't and come up with an evolution
of the concept that incorporates technology into society and works better.

For example: bitcoin, Ethereum, some kind of holistic schema for tracking
resources which would make us less dependent upon money and make it easier to
plan. Maybe have a few categories of money for different things.

If we can insert better technology (than basic money) to mediate society,
maybe we can create an opt-in society that is more fair, efficient, and still
evolves freely.

But don't just say "money sucks" and throw it out, and unthinkingly resort to
technocommunism.

Its kind of like when people will give up their Christian faith and then
decide they should become hedonists. We need to think through things more and
really synthesize ideas. Integrating technology into society can make things
like universal point systems (money) more practical and more fair.

------
pjlegato
The author seems to think this wealth accumulation dynamic is somehow unique
to free market capitalism, produced by a capitalist culture that explicitly
values money, economic efficiency, and wealth accumulation.

It's not. Every culture and economic system that has ever been put into
practice in all of human history has produced the exact same wealth
accumulation dynamic.

The main difference is that in the systems other than free-market capitalism,
significant wealth accumulation is not merely "difficult" for ordinary people,
but actually "impossible" if you're not a member of the tiny ruling circle.

At least under free market capitalism, as an ordinary person you do have a
shot, however unlikely it may be.

------
dhcar
Blaming negative societal effects on people wanting to make money is akin to
blaming gravity for airplane crashes. Moreover, the people that would listen
to these pleas for putting society before the dollar aren't the type that are
investing large sums, and those that are investing probably don't care to
listen.

~~~
lifeformed
The article isn't blaming them, it's trying to be cognizant of what's going on
and starting a discussion about what can be done.

------
pnathan
The _idea_ of 'selling out' itself is an artifact of Romanticism, combined
with the social idealisms of the 60s. It's not thinking very deeply to advise
people not to sell out, there are more intricate things going on than the
romantic idealization of "let's be poor and happy".

I also want to point out that it's a bit irritating to be told to not strive
harder by someone who's already got "FU" money.

------
teleclimber
As a DC kid I love that Fugazi gets a mention. It's true too: Ian MacKaye and
crew ran a completely different kind of band than most others. It's the first
time I realize how that distinction is analogous with DHH and Basecamp.

Here's Ian MacKaye talking about his philosophy w/ a reporter:
[https://youtu.be/7zc2-T6LbOo?t=25m](https://youtu.be/7zc2-T6LbOo?t=25m)

~~~
jacquesm
They still owe me a new left eardrum. Paradiso, Amsterdam, long long long ago,
I fixed one of the cables running from the stage to the sound pit (soldering
is a handy skill, re-splicing a 20 conductor multi cable under a stage after
someone cut it by wheeling a trolley over it is no fun) and got to stay for
free afterwards.

------
RangerScience
Moar comments!

If you consider a profit-maximizing corporation a paper-clip maximizing AI,
it's a hostile AI that's bad for people.

Then you take a look at Public Benefit Corporation, and what you could say
goes on, is that instead of using "profit" as a measurement of success, it's a
binary answer to sustainability. If a public benefit operation is profitable,
it can continue - but it doesn't matter _how_ profitable it is, because that's
not the success criteria.

Another interesting place to think about this is "profit as A/B testing
metric". Are user signups really what you want, or do you simply require user
signups to sustain, but what you want are, say, user-submitted content?

------
zaidf
Minor counterargument: Banks, Walgreens, Duane Reed have done much to improve
previously seedy neighborhoods by being able to invest in security and general
upkeep of their storefront.

------
untilHellbanned
Ironic article being from the CEO of Kickstarter, one of the biggest success
stories of the last decade.

All this talk of altruism, Zuckerberg and Gates too, is trivial when you have
it all.

The true measure is when you, like most people, behave when you have nothing
to lose and nobody is watching.

~~~
danans
Don't you mean "have something to lose"?

------
6stringmerc
_In music, 80% of the concert industry is owned by Ticketmaster. A diverse
universe of record labels is steadily consolidating down. A shocking
percentage of Top 40 hits are written by four Scandinavian men._

Yup, love that he included this tidbit. A little dramatic, but practical. They
figured out the formula, so they're a sound investment. Even Adele has a track
with Max Martin on her new album.

If there's a really cogent indicator of 'wealth disparity' there's nothing
quite like looking into the "Top 1%" of music acts versus the rest. Not that
music has, you know, traditionally been a great way to make a living, but the
numbers are really exploitative in a lot of ways. It's quite indicative of the
money first mentality I think, for music (and venues) to be consolidated (or
allowed to do so) in such a racketeering fashion.

 _Number 1: Don’t sell out...Do something because you believe it’s wonderful
and beneficial, not to get rich._

Oh, wow. I needed this. Mostly because it's such a futile thing to try and be
independent as a musician and make a living...or really any money...but it's a
personal decision, one based on principles. Glad he at least mentioned this
concept for consideration.

------
zhyder
I think customers have much more influence here than business owners do. If
more customers prefer shopping at local stores than at chains, local stores
will flourish. For better or for worse, most customers today prefer the lower
prices and consistent experience of shopping at big chains. It's the same in
other areas. More people seem to prefer blockbuster movie sequels than
original indie films: whether you're a profit-motivated studio exec or a
struggling artist, you want your work to be seen by an audience.

A minority of customers chooses local/eclectic/independent: not sure whether
this minority is growing or shrinking.

------
lionhearted
Some good points in here, but the points about chains/franchises is misguided.

I've been to many countries. If you go to China, Vietnam, Colombia, Eastern
Europe, you can find plenty of places without mainstream chains and lots of
local shops.

You know what? Most of them suck.

Bad selections, overpriced, trying to cheat you on change, rat droppings or
layers of dust on top of a variety of food products...

... I know if I go to Duane Reade or Chipotle, the food or medicine I buy will
be legit, unexpired, and without any egregious violation.

If I buy a pair of jeans at Walmart or Target and they rip in the first week I
own them, I can take them back.

Chain banks mostly suck, and credit unions or online banks are far better. But
for food, clothing, and medicine, chains are a godsend. You don't get cheated,
everything is decent quality, and clean. If you buy something and it's broken,
you can take it back. Not so in most of the world.

(And also, many of the small shops locally owned aren't owned by local people
just getting by -- they're owned by local bosses, who are just as callous as
the archetypical big corporation, but much less effective at delivering to
customers and much less accountable.)

Liked the rest of the article, and do admire companies that operate
differently like REI. But lionizing small disorganized ineffective dirty shops
is a miss; Chipotle and Duane Reade are godsends compared to what you'd get
otherwise. If you don't believe it, check out any developing country before
chain stores move in. It's not a better state of affairs.

------
RangerScience
A remark:

There's a fundamental unsolved (or, poorly solved, or, we don't like the
solution enough) civilizational problem: I have a new society. Where do I put
it?

And a longer comment:

I read at thing that suggested that companies with "noble purpose" make hand
over fist more money than companies with a sole profit motive.

One way to take this is that, by operating under different goals, you become
unpredictable to the established power, and the "OODA loop" concept teaches us
that's a solid way to win. Arguably, against a better positioned opponent who
can absorb you, playing by different rules is the only way to win.

Another way to take this is to pull the idea that "money" is only a
measurement of "debt", and is thus inherently unsustainable because it
measures a non-finite thing in a world of finite things. And so if you make
decisions by maximizing an unsustainable sense of depletion, it stands to
reason you'll end up making a depleted place.

\---

Of course, you can also read all this as "convincing you not to play our game,
so we don't have to compete with you"... akin to "stability is good because
I'm on top!"... but that just goes back to "need to play by different rules if
I'm to win".

------
MichaelMoser123
Isn't unrestrained profit seeking what modernity is all about? Pre-modern
societies had all sorts of customary/institutional restraints on profit
seeking.

* The classical Greek had their notions of temperance

* Romans had the notion that a proper aristocrat needs to own an agricultural estate, idea of civil virtues (these cost a lot of money) and that one has to spend the money on a huge estate with a court of slaves (familia urbana)

* China had their Imperial bureaucracy

* the European middle ages had corporatism/guilds in the cities

Once these restraints were gone we entered modernity.

(here is an article why China didn't do modernity, despite having had all the
big inventions that supposedly brought us capitalism - like the printing
press, gun powder, paper money, big advances in materials, a fleet that
discovered America. The authors say the structure of institutions was
restraining entrepreneurship and progress :

[http://www.amphilsoc.org/sites/default/files/proceedings/157...](http://www.amphilsoc.org/sites/default/files/proceedings/1570101.pdf)

------
hackaflocka
It's called Anglo-style capitalism. It's not perfect. But it's better than
every other system that's ever been tried.

~~~
Apocryphon
Better than Scandinavian social democracy? Better than German social market
economy? Better than East Asian Tiger hypergrowth-capitalism-but-with-strong-
government-intervention?

~~~
clarkmoody
Go back and analyze how Scandinavia got the capital to launch its massive
social welfare programs. Same for Germany. Who did China trade with in order
to become wealthy?

~~~
Apocryphon
Well, Norway has a massive sovereign trust fund derived from North Sea oil, so
it's an outlier. The other Scandinavian nations began creating their social
welfare systems since at least the 1930s, if not earlier.

------
dschiptsov
BTW, this very style of writing - shallow meme-juggling is also very telling.

There are guys like Sartre and Camous or even Henry V. Miller and his
immitators, who have wrote volumes on this timeless theme - how the world is
dominated by money-chasing mediocrity and absolute futility of this endless
struggling and caused by it suffering. A few very good books has been written
about realization of this futility and suffering.

So called social responsibility is also as old as humanity. Big Tibetan sects,
which in fact were feudal landlords, used a concept of socially oriented
Bodhisattvas, invented by pundits in Nalanda, in order to justify why every
village should feed them, so they exist to benefit the whole society, which is
just another Utopia, because each member of society is optimizing for very
selfish, biological goals of survival and reproduction and protection of
progeny.

In the context of a CEO blog post such populism is just the same kind of
hypocrisy - socially responsible money making is no different from socially
responsible authoritarian regime.

There is no need to protect or nurse a society. Just following of some evolved
social laws, which could be found in the basis of every religion, and not
intervening or abusing free (self-balancing) markets, which is, by the way, is
idea as old as kicking speculators and money lenders out of the church, is
enough. Society would take care of itself, as most of rural societies still
do.

The 'cure' for society, as it have been found millenia ago, is to behave
yourself according to the natural laws, and everything else would follow. No
amount of governing or policing will help. Behavior of each actor is what
society is.

This, BTW, is exactly what America before corporations and big government used
to be - a self-balancing society of free people with Constitution as the
definition of its structure.

------
ddxv
Like clouds of gas in space gathering mass, money attracts more money.

~~~
hliyan
It has been said that turning $100 into $110 is work, but turning $100,000,000
into $110,000,000 is inevitable.

~~~
stillsut
It's also been said the best way to build 100M company is to start with 1B
company and run it on intuition.

MC Hammer, 50cent (?), so many multi-millionaire athletes are bankrupt. The
fact that the basic institutions we require to exist - banks, convenience
stores - stay financially viable is something we take for granted. I'm not
sure tne new-kickstarter-economy can exist without the persistence of the old
boring economy of scarce resources.

------
arbitrage314
I don't really follow the logic of the article. Humans have optimized for
"money" for a long time, and it's produced a lot of good and a lot of bad.
Overall, though, I'd say we're very much headed in the right direction.

In the meantime, though, just try to be happy (as the article suggests).

------
galfarragem
_> >Behind this dynamic is a monoculture of money optimizing for more money._

That's capitalism, what's the fuss about it? It's not possible to have only
the good of capitalism and the good of communism. The bad parts will come in
soon or later.

The "don't be evil" approach has already proved to be BS so we must choose
what do we really want.

An interesting experiment is East Europe, a capitalist society that uses some
good communist laws. E.g. Student used to have a large discount everywhere,
allowing everybody to study. Discounts are getting smaller and smaller till
the day that they will disapeer. Or people that couldn't be fired after some
age. Even if people don't want to loose these policies, it's a matter of time.
It's very hard to have the best of both worlds.

------
reedlaw
Interesting that the book mentioned, Not for Bread Alone, retails for over
$2700 on Amazon 1.

1\. [http://www.amazon.com/Not-Bread-Alone-Konosuke-
Matsushita/dp...](http://www.amazon.com/Not-Bread-Alone-Konosuke-
Matsushita/dp/0425141330)

------
PythonicAlpha
I think, that having (idealistic) principles and regard them as being above of
money, is very important.

Today, it seems, that many people just have one principle that holds above
anything else: Money. I think, this way, we ultimately sell out humanity.

~~~
cryoshon
Humanity is useless; it can't be manipulated or traded to increase profit.

And as such, we arrive at the present.

~~~
PythonicAlpha
Some day, everything will belong to only a few people and the rest of us will
be their slaves. But maybe at this time or some day before, some might
recognize, that living on profits alone is not possible.

------
vijayr
There is an Indian restaurant near my home and a bookshop - I really like both
of them but I've been going there less and less. The restaurant added more
tables, so during the buffet, it is impossible to walk 10 steps to your table.
People give death stares, spill food etc. The bookshop added more shelves with
books and now only one person can walk between shelves instead of two. What
used to be a pleasant experience has now turned into an annoying one at both
places. Result is I get my books from Amazon.

This might be a trivial and stupid example, but when everything is optimized
for revenues and profits it really is demoralizing.

~~~
theseatoms
Sounds like they aren't properly optimizing if they're alienating loyal
customers.

Or maybe it's worth risking the business of loyal customers in order to
attract more marginal customers. Btw, is this Indian restaurant called
"Twitter"?

------
littletimmy
In political ponerology (study of evil in politics, coming from the works of
Polish psychiatrist Andrzej Łobaczewski), a _pathocracy_ is defined to be a
government where a small minority of psychopaths through the machinations of
the system gain vast amounts of power and use normal people to their benefit.

Homo-economicus is a psychopath. He values profit over people, uses people as
resources, measures his own worth in money, harms the environment, has no
deeper values, and so on. Insofar as our (capitalist) society rewards homo-
economicus instead of shunning this miserable being, we are going to be ruled
by a pathocracy.

~~~
Florin_Andrei
> _Homo-economicus is a psychopath. He values profit over people, uses people
> as resources, measures his own worth in money, harms the environment, has no
> deeper values, and so on._

This is known as a "rational agent" in some circles, lol. Just shows to what
extremes people self-justify their actions and ideologies.

~~~
littletimmy
Without empathy or remorse, a "rational agent" is a sociopath.

~~~
denim_chicken
Empathy and remorse cause inefficiencies in the economy. A perfectly rational
agent would have neither.

~~~
littletimmy
Therefore, he is a sociopath.

------
cmmender12
Funny, coming from a guy who has made millions of dollars in his career. I
agree, once I make a billion dollars I'm all for not being so focused on money
anymore ;) I think his argument would be a lot more convincing if he was not
rich.

It's sort of like when Stanford/Harvard graduates say that we should abolish
elite universities and that the degrees are worthless. Easy to say for the guy
who already graduated from there. I totally agree, as soon as I graduate from
Stanford, I will go around saying how it's not worth much. But until then,
I'll try like crazy to get in.

Thoughts?

------
hellodevnull
>No matter their importance to their community, they can’t stay if they can’t
pay

>Investors make money, franchises notch a new location, and the neighborhood
suffers a significant death.

What are these businesses that are so great to the community yet don't make
any money? If everyone's taking their business to franchises it's because they
(the customers) prefer them and franchises provider a better service.

Seems like the author just longs for independent stores and the like simply
because he dislikes corporate culture, and would rather pay more to avoid it.

------
vincent_s
> In tech, many investors’ first question for entrepreneurs > is “what’s your
> exit strategy?”

"When we made the investment, it was decided that we'd keep it quiet for a
while." [1]

[1]
[https://www.usv.com/blog/kickstarter](https://www.usv.com/blog/kickstarter)

Also interesting: [https://www.crunchbase.com/organization/union-square-
venture...](https://www.crunchbase.com/organization/union-square-
ventures/exits)

------
rphv
Money is the most powerful mechanism for influencing human behavior that
mankind has ever devised. The phenomena this article describes (banks in New
York, chain outlets, etc.) are _emergent_ \- they arise from the aggregate
behavior of lots of ordinary people working (at least in part) for money. If
the goal is to change the emergent phenomena, then it's necessary to give the
_average individual_ an incentive that's more powerful than money. I don't see
that here.

------
NPMaxwell
About not selling out: usually we make business decisions without knowing how
things will turn out. We get advice. Market research is done. Even so, lots of
business decisions are gambles -- especially entrepreneurial decisions. As
long as you don't know which will work out better, selling out or not selling
out, the estimated future benefit is greater for behaving well: if your
project fails, you don't have to deal with shame on top of the failure.

------
gtpasqual
Kickstarter wouldn't be here without the 'monoculture'.

In 2011, they've raised 10 million dollars. They should thank the Fed and
abundance of capital.

------
cryoshon
I love this article. It definitely hits on a bunch of really important points
with regard to the tendency for capital to accumulate more capital, and for
capital to remain in place rather than flow once it has established a large
bolus. I would prefer things discussed in these terms rather than "banks on
every corner in Manhattan" because it strikes at the heart of the issue rather
than a symptom of the issue. The heart of the issue is that our society has
been warped to accept capital as its only philosophical value, and, as a
result, we have come to worship large accumulations of capital despite their
extremely deleterious effect on many other aspects of society. The mitigation
and eventual mending of the wounds caused by late capitalism is probably going
to be the work of an entire generation of people. Thankfully, people have
begun to recognize the problems of capital accumulation and stagnation, so we
have perhaps only twenty or fourty years before we can make meaningful headway
on this issue-- maybe even only five to ten years if there's some major
rattling of the cage, but it hasn't materialized yet.

"At some point in the past ten years, selling out lost its stigma. I come from
the Kurt Cobain/“corporate rock still sucks” school where selling out was the
worst thing you could ever do. We should return to that. Don’t sell out your
values, don’t sell out your community, don’t sell out the long term for the
short term. Do something because you believe it’s wonderful and beneficial,
not to get rich."

In the past ten years, the tension between "not selling out" and "feeding
myself and paying my student loans" has reached a breaking point where
increasingly few people can maintain an acceptable standard of living and not
take lucrative opportunities. In other words: the opportunity cost of "not
selling out" has skyrocketed to unsustainable levels. This is caused by many
factors, and will not reverse itself until we have some form of major scale
resource redistribution. The realistic summary is that doing wonderful and
beneficial things leads to the poorhouse, and "selling out" for most people
leads to a middling barely-financially-secure existence that falls far short
of getting rich and still doesn't have enough resources to plan for the long
term.

"Don’t sink into the morass of “industry standards.” Don’t succumb to the
inertia of the status quo. Don’t stop exploring new ideas. A small number of
people can change how society works. It’s happened before and it will happen
again."

I doubt that many of us want to sink to the median, but the status quo has a
way of smashing down people who try to explore new perspectives, and the
economics of this fact are especially fierce right now. This is part of the
problem, of course: the accumulated capital has an overwhelming interest to
maintain the status quo of their wealth, and has many resources to kneecap
change. Then (because this is related to Kickstarter, I am obligated to write
this) there's the fallacy that inventing a new toy or app will change
society-- sometimes it's possible, but on average it doesn't happen. I'd like
an app for social change, but even something as simple as an app which lists
what companies to boycott on a given day would probably run into legal trouble
very quickly.

"Look at the language on that cover: “be paranoid,” “go to war.” Its violence
suggests that being ruthless is the only way to survive. We all hear this tone
all around us."

Yes, I have noticed the terms of violence / natural selection being pushed in
order to make people more vicious toward each other in their pursuit of making
a living. Largely, this language-shifting effort has worked, and people view
each other as competitors for resources rather than potential allies to
increase the wealth of the community. I will state that this kind of
anarchistic worldview benefits employers and corporations a tremendous amount,
and benefits the public not at all. I suspect this is one of the contributing
factors to reduced mental health in the US, and also one of the contributing
factors toward people shunning union work. And yes, the prioritization of
money above all other considerations is one of the major problems that has
almost always existed in America. The people with the most money have lived
here through the modern era, and have shaped the USA to funnel money into
their coffers. Rather than lament about how we can't kill these people and
take their cash, I think it's more productive to think about the policies we
can specifically ask for which would prevent radical wealth accumulation in
the first place.

Right now I think the best path forward is to come up with a scheme which
redistributes capital downward and breaks up the largest clumps of stagnant
money. I have no idea how the math on this is going to work out, but the
sooner we get the political wheels in motion (Bernie Sanders is a good start,
but we need about 300 more of his type before we can make headway) the sooner
we can start to undo the damage caused by the crony-capitalism economic policy
of the last 40 years. Rather than prioritizing the ability for people to make
vast sums of money (and make no mistake, we have prioritized this), we should
prioritize raising the standard of living of the median citizen and ensuring
equality of opportunity. I guess this means either a negative income tax or
UBI.

~~~
Futurebot
> the opportunity cost of "not selling out" has skyrocketed to unsustainable
> levels

That's phrased perfectly, and exactly what I came here to say. For the
'marginal careerist', one with just enough opportunity to get ahead, but not
enough to float by (e.g., possessing rich relatives) there isn't an easy
choice. Staying ahead of a changing job market, increasing barriers to entry
(credentialism and other funnel-narrowing HR filters), ageism, and the
knowledge that the tattered safety net isn't going to help them very much if
they fall out means they won't necessarily have the luxury of saying 'no' to
every dubious opportunity presented to them.

It's no longer just about winning the rat race. For many of today's rats, it's
now about staying on the ship at all.

The original article is one of those feel-good articles that I want to agree
with. It's earnest and idealistic, and brings up several important points. For
those who are able to do what Mr. Kickstarter is able to do (to make those
socially responsible choices that maximize for self-interest AND social good
[i.e, enlightened self-interest] instead of maximizing for selfishness) that's
actually all great and beneficial. I like it. Many of his observations, too,
are spot on. His recommendation however, that tells people to 'do that'
reveals a lack of perspective on the actual lived experience of many people
functioning within the modern reality. Collective action problems can't be
solved by individuals, nor by socially conscious companies (as nice as those
may be.)

~~~
YanceyKSR
it really is phrased perfectly, and i agree completely about the challenging
tension of that question. i feel it distinctly, especially as i am expecting
my first child in just a couple of months and i do not come from money.

i feel like the moment selling out became okay culturally coincided w/ file-
sharing decimating the music industry and we all unconsciously thought, "well
shit musicians have to make a living somehow" and then pop/indie/classic rock
was in commercials and everyone was generally cool with it. and i don't have a
big issue with it, and absolutely want to live in a world where artists can
have sustainable lives through their craft and don't want certain avenues to
be off-limits because they seem cheaper than others

but played out to the nth degree it just all becomes overwhelming and
dispiriting. anyway, just wanted to say i really appreciated reading these two
thoughts. i very much agree

~~~
Futurebot
It is overwhelming and dispiriting, and I certainly don't pretend to like it.
On the one hand, there _is_ still a good amount of quality music coming out on
places like Soundcloud/Bandcamp. On the other hand, many/most of those artists
are likely not making much of a living off of it, and that's sad because it
means that they produce less music that we might want to listen to because
they have to spend their time on other things
([http://www.nytimes.com/2012/09/22/business/to-stay-
relevant-...](http://www.nytimes.com/2012/09/22/business/to-stay-relevant-in-
a-career-workers-train-nonstop.html)) like working/studying/retraining (my own
extremely-niche music is/was something I chose to only do in my spare time,
knowing the reality.) It also may be dissuading would-be artists from creating
something in the first place, which means we're deprived of those potentially
great works. Definitely a negative.

Relatedly, I sometimes wonder about how much of the compromised musical vision
(AKA selling out) is actually a myth in terms of pop music itself. The
counterfactual is something like: artist X, who is making some kind of music,
would have made some other kind of music that they would have preferred to
make (because it was more in line with their vision) if they had the economic
freedom to do so. Is that really right, or are they 'making' what they would
have made anyway? I quote 'making' because of the number of non-music writing
pop stars (the aforementioned four guys with all the top 40 hits who are the
ones actually writing the songs) is larger than many might imagine. Are those
pop stars really just 'celebrities who specialized in music', rather than
'musicians who compromised their visions'? Tool managed to break through the
niche->pop barrier in the 1990s despite their decidedly non-mainstream,
aurally challenging (and compelling) sound, but does anyone believe there are
little Tools just hiding inside of Justin Timberlake, let's say? If someone
like that becomes elevator muzak, is that really a 'sellout' when it's
designed that way from the outset? This one is hard to disentangle.

Maybe there's another way to frame it. Maybe the problem isn't 'selling out',
per se, but that niche audiences, unless you are somehow able to get to the
"100 really super duper true fans" or its equivalent, just don't pay the bills
very well. We have your Kickstarter and we have Patreon, and we have all that,
but does that sustain the number of potential artists - some of whom may
create incredible works - in the modern economy? Did it ever? (I'm sure some
would-be musicians starved during the actual patron eras, too.)

The Superstar effect ([http://www.nytimes.com/2014/02/23/business/winners-
take-all-...](http://www.nytimes.com/2014/02/23/business/winners-take-all-but-
cant-we-still-dream.html),
[http://marginalrevolution.com/marginalrevolution/2010/09/win...](http://marginalrevolution.com/marginalrevolution/2010/09/winner-
take-all-economics.html)) is real and cross-cuts industries; an economy-wide
phenomenon. I think it's going to be difficult for these platforms to serve as
a real counterweight to that, as much as I'd _really_ like them to, because
they're swamped by much larger forces. We've democratized distribution, and
some of the platforms /have/ widened the economic net a bit, and I'm glad
about that, but the forces are larger than I think they'll ever be able to
handle, at least in the US.

That brings us to the next question: is the story the same in still
relatively-low-cost-of-living Berlin (where a Kickstarter/Patreon might
actually be able to replace serving coffee, giving the artist the ability to
work on art full time), for example? This is especially important for
collaborative styles of music. We can tell a starving artist "just live go
somewhere cheap", but rural Minnesota is probably not going to have the kind
of music scene necessary to engender the collaborative creativity /
connections that you're going to get in Berlin (or once upon a time, on the
Lower East Side/East Village in New York), and also have a receptive local
audience interested in things like live music.

So maybe we add another qualifier: "enough to live in a collaborative,
musically vibrant place." Can these platforms ever do that? I don't think by
themselves they can really solve that problem. Not all, gloom, though, as I
think there might be external solutions worth entertaining:

1) Artist subsidies or tax credits. Hate this one, and lots of other people
like do too, as incentives and administration are mess, but worth mentioning
since I've seen it proffered before.

2) GBI. Possible superb fix, not going to happen any time soon.

3) Massive development leading to lower rents in desirable areas, so the next
wave of those to be pushed out could stay (Ridgewood, Queens is a good example
of cheap and artist friendly now, but possibly at risk in 5-10 years.) I wrote
a whole post on this ([https://medium.com/@opirmusic/fixing-the-nyc-rent-
crisis-or-...](https://medium.com/@opirmusic/fixing-the-nyc-rent-crisis-or-
the-rent-is-still-too-damn-high-edb13ca853cc)) Most powerful one, in my
opinion.

4) Artist housing: something that has been tried before, and I think is worth
considering again. Administration would be the tricky part, but it at least
seems possible.

5) Generalized cheap co-housing with shared amenities. I know some companies
are working on this, but it remains to be seen if they can make the numbers
work in an NYC or an SF. I really like this one, and I hope someone makes it
work.

Finally, I'd also add that my original reply was generalized to the job market
as a whole; it applies just as much to your C++ hacker who would rather be
making interactive art rather than writing device drivers, or to a marketer
that is actually good at what they do and would rather being working in
politics or something, but takes a job at an ad agency helping to advertise
soft drinks to keep their little rat body from going overboard.

To use an example in technology: I understand the appeal of working on
complicated distributed setups, using cool algorithms at scale, etc., but how
many people _really want_ to work on "thinking about how to make people click
ads", and how many are there because that's how you make good money (and by
extension, achieve financial safety and independence)?

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ctz
The songwriter point is a strange one. I don't think its a feature or result
of today's commercialism. For example, see Doc Pomus and Mort Shuman -- the
"Every song you love was written by the same two guys" of the 1950s/1960s.

------
owly
I don't understand why deleting Facebook is difficult. It may be the easiest
way to opt out. It's no more difficult than abandoning corporate media. You
don't need it. Connect with real people who you care about in the real world.

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kumarski
In the USA, we have:

7000 taxi medallions.

8 Major Film Studio Companies. (‘The Majors’)

15 Large Banks.

3 Major Radio Stations.

3 Major Labels.

2 Major Ticketing companies.

2 Major broadband providers.

2 Major telcos.

~150 MVNOs. (Mobile Virtual Network Operators)

10 Major Movie Theater Chains.

4 Big Accounting Companies. (“The Big 4.”)

10 Major Grocery Companies

7 Major Financial Analytics Companies – Terminal

5 Credit Card Companies(Visa, MC, Mastercard, Amex, Discover)

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jarsin
Isn't a possible solution to this problem to make it easier and cheaper for
others to take part in others success.

Thus more companies/people will have a chance at being successful and more
people will profit from their success.

------
treelovinhippie
If KickStarter truly reflects these ideals, they should decentralize their
crowdfunding platform on the blockchain (eg Ethereum) and only charge the bare
minimum fee required to maintain/grow that platform...

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peter303
Some hipster jest rediscovered capitalism. A system built on constrained
mutual greed. It tends to make the big get bigger. Not only old style
industries like farming and banking but new ones like sftware too.

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mindcrime
_In the past 30 years, downtowns everywhere have been hollowed out by strip
malls, chains, and real estate development. Local businesses that serve their
communities are going extinct._

This is just generic "appeal to nostalgia", romanticizing a bygone era that
probably never existed "as such" in the first place, and desperately scraping
for a way to attack modern capitalism.

When chains displace "local businesses" they do so for a reason: they offer a
combination of price/service/value/whatever, that the residents of the region
favor to an extent that it makes the other businesses no longer viable. If
people want "friendly neighborhood druggist who has lived and worked in the
same spot for 70 years" they don't appear to be willing to pay for that.

As for "the need for money to make more money"... yes, that's a real
phenomenon, no doubt. There's a reason Pareto distributions occur and it
probably has to do with "preferential attachment" and path dependence. And to
be fair, pretty much nobody _wants_ a world of deep economic inequality.
BUT... you have to look at the flip-side... in many ways, it is easier and
cheaper today to start a new enterprise and begin the path of "making more
money" than it's ever been. It's been cheap to start a web-based SaaS offering
for a while, and even though enterprises making physical goods are still
expensive, the emergence of things like Kickstarter, Indie-go-go, etc. have
made that world more accessible as well.

If you want to argue that it's unfair that Joe Random Guy can't start a new
oil refinery or steel mill or a nuclear power plant, then OK... you have a
point. But has it ever been the case that just anybody could start something
like that? And is it necessary for that to be the case?

 _A diverse universe of record labels is steadily consolidating down. A
shocking percentage of Top 40 hits are written by four Scandinavian men._

And yet the universe of music that I have access to has been constantly
expanding, thanks to the Internet, open source software, and advances in
technology which make powerful tools for creating and recording music cheaper
and cheaper.

 _Don’t sell out your values, don’t sell out your community, don’t sell out
the long term for the short term. Do something because you believe it’s
wonderful and beneficial, not to get rich._

Now this we can agree on. This is one reason we haven't tried to raise outside
capital at Fogbeam. We want to build the kind of company we want to build, not
necessarily the kind of company that VC's want to build.

 _Always act with integrity. Really be clear about the things that drive you.
Remember the lessons your parents and grandparents taught you about how to
treat people and make sure your business lives up to that._

Agreed.

 _Earlier this year we became a Public Benefit Corporation. This means we are
legally obligated to consider the impact of our decisions on society, not just
our shareholders. It’s very different from the expectation that for profit
companies maximize shareholder value above all. It acknowledges and embraces
that you are a part of a larger community._

Benefit Corporations are a great idea, and I hope North Carolina adopts a "B
Corp" law eventually. We don't have the notion here currently, not as a legal
form acknowledged by the State anyway. If any fellow North Carolinians are
reading and want to work together on B corp advocacy here, ping me and let's
get started.

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snissn
Was anyone else really upset to see the photo of the TD Ameritrade that
replaced Mars bar?

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Dowwie
I wonder what the meetings between Union Square and Kickstarter are like..

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platz
I wonder why Adbusters died out, this is basicallynthe same message

------
blazespin
You mean, capitalism?

------
theseatoms
Good thing risk-free interest rates are 0%.

------
shmerl
What a horrible culture that is.

------
wespad
No mention of Hip-Hop?

------
Eleutheria
Money is a medium of exchange. The more you produce the more you exchange
value for value. The problem is not money and it has never been. The problem
is power. Power to leech and mooch from the producers.

Enter the state.

