
How to Legally Own Another Person [pdf] - micaeloliveira
https://dl.dropboxusercontent.com/u/50282823/employee.pdf
======
_lex
This is incomplete, but very, very good economic analysis. In the end his
points are simple:

0\. Employees are willing to trade "freedom" for job stability and increased
average returns. Contracters will more easily defect for sporadic higher
paying opportunities, which makes them less reliable.

1\. Employers can overpay employees while ensuring that they know that they
are overpaid, to 'domesticate' their employees and improve reliability of
outcomes.

2\. Decades ago, employers could also promise long-term job security to
achieve similar effects, however rapidly changing markets mean their future
existence (and ability to grant stability) is in question.

3\. Instead, employees have fixated on cross-company careers, optimizing for
general employability , which means that they must still conform to the
requirements of a domesticated employeeship.

4\. However, when employees have significant, direct, measurable profit impact
skill, and can make or break the company, they can not be owned.

He also does an economic analysis of cursing, while explaining that maximizing
employability tends to strip away the parts of people that can make them
great.

~~~
_lex
Two interesting things: 1) this predicts difficulty in controlling contractors
and getting them to stick to schedules. It explains why taxis suck, homejoy
struggled, and showcases that uber circumvented the entire issue of driver
reliability by only doing on-demand rides. It also predicts that scheduled
contractors will attempt to steal clients from the scheduling company (direct
measurable profit impacting skill - you can't own them). Perhaps the on-demand
service strategy that works requires either the use of employees or zero-
scheduling/real-time request resolution.

2) As an employee, you must figure out how to measure your profit impact and
consistently represent that metric as fact - socialize the idea that you have
profit impact. You also want to figure out exactly how what you do and how you
do it can increase or decrease profits: being the person who's able to both
represent a meaningful metric and show how you've affected that metric, and
how that metric should have affected the bottom line will make you the most
valuable. If what you do does not impact profitability, then do something
else.

~~~
acveilleux
One way to view Uber is as a redundant array of inexpensive drivers. Since the
individual contractors are fully fungible and numerous, one will usually be
available to take on any new request. It is an anomaly of the Uber model that
the barriers are incredibly low, the service is provided very quickly and that
a significant number of drivers are willing to idle waiting for a ride. This
is reflected in the relative low pay.

Even then, I bet Uber has retention or reliability problems with drivers.

------
jondubois
I've been both an employee and a contractor for various companies.

I found that being a contractor is usually easier, the work hours are shorter,
the pay is MUCH better and 'job' security is actually higher (which really
surprised me - I've never been fired from a contract job).

From a company's point of view; contractors are not good value. Sure, it's
better to hire independent contractors than to outsource everything to an
outside company, but a contractor is nowhere near as productive as a full-time
employee.

The kinds of companies which hire contractors instead of full-time staff are
often interesting companies...

~~~
toptalentscout
>> but a contractor is nowhere near as productive as a full-time employee

I disagree, also speaking as someone who's seen a mix of runs as a contractor,
consultant and staff employee. It's the individual who is very productive or
not, not the role they are filling.

~~~
jondubois
Yes that's true. Contractors are often more skilled than non-contractors
(they've often older and had a wider range of experiences).

But contractors, like entrepreneurs, are self-serving individuals. If your
company has a large codebase and you depend too much on contractors, they may
create a 'clan' inside your company and they will have leverage over
management. I've seen this happen in large companies, never in a startup
though.

I agree though that it's not because they're contractors. It's more because
they're greedy.

------
cgh
"The best slave is someone you overpay and who know it, terrified of losing
his status."

As I sit here entering my 12th hour of work for the day, this sounds
remarkably legit.

~~~
escherize
Except it conflates a voluntary relationship for a forced one.

Slavery is being taxed at 100% of you output.

~~~
duncan_bayne
What about being taxed 40%?

I recently severely pissed off a correspondent (who'd written Yet Another
Article on the evils of capitalism) by equating compulsory taxation with
slavery.

~~~
guelo
I don't get your point. Has there ever been an example of a succesful tax-less
capitalist economy? Or are you saying that at some tax level below 40%
capitalism shifts from slavery to non-slavery?

~~~
pandaman
>Has there ever been an example of a succesful tax-less capitalist economy?

I think the GP means income tax since the conversation is about being a slave
=== being 100% income taxed. And yes, there had been an example of a
successful income tax-less capitalist economy. The United States of America
for most of the time pre 1913.

~~~
brightball
Maybe in terms of the income tax that we know today, but if you did any
importing or exporting you paid a heck of a lot of taxes via tariffs. If you
ever get a chance to read up on the pre-Civil War period you'll find that the
south was responsible for about 87% of total Federal revenue and almost
entirely due to tariffs.

It's an interesting subject.

~~~
csense
Why don't we go back to that system?

~~~
duncan_bayne
That's an excellent question ... my experience over several years helping
campaign for a party that wanted to eliminate progressive taxation was that:

* people are terrified of fundamental changes to systems that provide their 'benefits', even if the existing system involves literal slavery

* people get really, _really_ angry when you mention the 'slavery' thing; they don't seem to like really thinking about how the sausage is made, so to speak

* slavery is easy when quality of life is so good; it's easy to get bent out of shape when 40% of your income is being taken when your income is diddley-squat; when you're living like a 1700s king already, meh

* socialists have entirely and completely conflated the concept of a just society with compulsory taxation and state welfarism that it is almost impossible to get people to even acknowledge that the two can be considered separately

* self-described capitalists are often only capitalists when it suits them, otherwise they are often happy to suckle from the State tit to a far more egregious extent than any 'welfare queen' ever did

I don't do politics any more.

------
late2part
Not everyone agrees, but I often feel like I'm reading genius when I read
Taleb.

I especially like his insight about those really comfortable not putting on
pretensions or airs. Go to Bucks in Woodside some time.

The really good VCs are really good genuine people.

------
kawera
Another chapter of the same book:
[https://dl.dropboxusercontent.com/u/50282823/minority.pdf](https://dl.dropboxusercontent.com/u/50282823/minority.pdf)

~~~
nulltype
Also interesting, is the title of the book "Skin in the Game"?

~~~
theGimp
I think so, but I can't find it, so I'm guessing it hasn't been released yet.

Those seem to be excerpts released by the author.

~~~
phantarch
In the bottom left of each page it says "This is a preliminary draft." I'm
looking forward to this book when it does come out though!

------
n00b101
Very thought provoking. It seems like a good argument in favour of
entrepreneurship and risk taking.

But I'm not sure that I agree with Taleb's glorification of Front Office
banking roles in sales & trading. Like any sufficiently highly paid corporate
employee, traders are compensated mainly through company shares which vest
over a long period of time. These days a trader's bonus can even be clawed
back, many years after being awarded. Rumour is that Wall St traders are often
caught up in a culture of excess where bosses pressure them to spend/live
extravagantly and become completely dependent on annual cash bonuses. For all
the supposed risk taking tolerance bravado, traders are merely risking the
firm's capital and not their own. In some ways it is similar to the expat role
- just as some executives are chosen to be expats, some bank employees are
chosen as traders and given enormous amounts of the firm's capital to bet
with. No one can say what to look for in hiring a good trader, there is no
consistent basis for selection, there are no academic or professional
credentials for traders, the bank executives can choose to shutdown a
particular trading desk on a whim, the worst fear of a trader is to lose this
coveted position, and most people do not last very long as traders as their
luck runs out eventually at the poker table. If an expat executive is like a
diplomat fearfully being assigned from one foreign posting to the next, then I
think a trader is like a gambler-slave sent to gamble with his master's money
in the casino and he is in constant fear of the dire consequences that await
if and when he loses too great a sum or fails to win large sums frequently.
Trading jobs are usually a better deal for the employee than most comparable
jobs, but it is still an employee job and it attracts exactly the kind of
people who go to business school and actively seek low risk careers and
dependence on a paycheque written by a prestigious employer.

~~~
spacecowboy_lon
A saw one wall street Forum where young traders where advised not to wear
expensive watches as their was a strict hierarchy.

Apparently wearing cufflinks was also a no no - which made me smile as the on
or 2 days a year I wear a suit I ways wear shirts with cufflinks.

------
titomc
get the person an H1B visa and you legally own him. Indentured servitude at
its best.

~~~
justinjlynn
An employer of an employee on a sponsored H1B visa is unable to keep that
employee from finding new employment at another employer who is willing to
file an H1B petition. There isn't any way for the current employer to find out
the employee has applied elsewhere. If the employee already holds an H1B, then
the new employer is not limited by the yearly H1B cap [1].

I am by no means an expert on legal or immigration matters, so you'll have to
do your own research. Also, since you refer to an H1B but did not explicitly
state the country, I'm assuming you're referring to the US where Skilled
Immigration for Work visas are typically called H1Bs. Please correct me if I'm
wrong. Cheers

[1] <[http://www.immihelp.com/visas/h1b/h1-visa-transfer-
faq.html>](http://www.immihelp.com/visas/h1b/h1-visa-transfer-faq.html>) \--
looking for a better source that's not commercial, happy for pointers.

~~~
dataminded
My understanding is that changing jobs can be detrimental to your application
for a permanent green card in some cases.[1] Sometimes that is bad enough to
keep you where you are.

[1][https://www.quora.com/If-an-employer-has-applied-for-a-
green...](https://www.quora.com/If-an-employer-has-applied-for-a-green-card-
can-one-change-jobs)

~~~
titomc
Yes it is. Changing jobs will reset the greencard process ( which is 8 years
for Indian & Chinese citizens ). So H1B jobs cannot be changed easily. Cannot
ask for raise because the employee's destiny is in employer's hand. H1B's
spouse ( H4 ) cannot work even though they are well qualified. ( I feel
restricting spouses to work is something similar like in Saudi where women
can't drive )

I am in H1B. I cannot change my employer because my greencard has been filed
recently. I have to wait for 8 years to get permanent residency. Every three
years I have to renew my petition. I will be 40 when I get my greencard. I am
going to get married now , my spouse resigned her job in India at Oracle and
is going to sit at home watching TV & cooking in US, because she is not
authorized to work with H4 visa. She is a Master's degree holder in Finance
and fluent in English & French. Now she has to spent all her productive years
in a rented apartment.

I140 work authorization is a ray of light. USCIS is like a chameleon ,
changing rules all the time , putting many skilled workers under anxiety and
stress all their life.

So me & fiance is planning to apply for PR in Canada as soon as we get married
through the express entry system and get out of this mess soon.

~~~
koide
I'm sorry, but she doesn't have to spend her productive years cooking and
watching TV. She can perfectly write, read, blog, or stay in India at her
oracle job, among a myriad of alternatives.

I'm not defending the H1B system, which sucks, but you always can find a
better way.

~~~
titomc
Not everyone likes to write,read or blog ,people are different, nor can she
stay in India. I don't think you understand how marriage works in Indian
culture. How does it feel for you to get married and then stay away from your
partner. I don't how it works in this part of the world. But it won't work for
me.

~~~
koide
I see many (most?) people block themselves into false dichotomies, in this
case: "Either I can work as whatever I was trained at or I must stay at home".
There are more options, always.

I was not presuming to know what will work for you, just mentioning there are
lots of alternatives. Many require courage and effort, but still, they are
there.

Don't forget that if the Canada plan doesn't work.

~~~
titomc
In my case , it not only needs courage and effort. The USCIS restricts me from
working on anything else than the occupational field for which I got my work
visa on. I am not whining or anything, this country has given me a lot of good
things. In fact the pros outweighs the cons. I am just pissed off with the
fact that my spouse can't work , just because she is married to an H1B worker.
As an individual , its not her mistake that she married an H1B worker. She is
not even allowed to have a SSN ! An alien who do not have SSN cannot open a
bank account among many other restrictions.

~~~
koide
She can't legally work, that sucks.

She can do many things that are not classified as work, though. And that's the
important thing, she can still make/do/think/learn and might even go as far as
unofficially trading with people for that (talk to a lawyer first - the
trading part might not be such a good idea, but the first part sure is.)

Anyway, just pointing it out for the third time to try to get the point
across, I find it a hard thing to do: You very frequently have more choices
than those you think you have, and in the cases when you really don't it's
because you've chosen a path that's led where you are, so you either get
creative or get stuck.

------
rwhitman
I really enjoyed reading this. If I wanted to pick up one of his books, any
recommendations out there for where to start?

~~~
FlailFast
Black Swan is still his best in my mind, but the Bed of Procrustes can be a
nice entree; aphorisms were the original tweets, and can be consumed as such.
Then I'd jump into Fooled By Randomness, and finally Antifragile (which is the
weakest of them...truthfully I think the entire book could have been a chapter
in Black Swan, but I'm glad he wrote it all down anyway).

~~~
jessaustin
I've read them all, and I agree completely with your judgement of them.

------
littletimmy
It is interesting to note that a few hundred years ago, people didn't make
that big of a difference between chattel slavery and wage slavery (labor).
Both were university acknowledge to be great evils, and it was as dehumanizing
to rent a person than it was to own a person.

Somehow we've all accepted wage slavery as alright. Good even! If someone
doesn't have a job we deride him as a lazy ass for not wanting to sell his
labor to a capitalist. A solution: universal basic income. Give everyone fuck
you money. Then you'll have a free society.

~~~
dracht
Where will this basic income money come from? Forced taxation, aka extortion,
aka partial slavery. That's not a free society, just a different master.

~~~
littletimmy
Taxation is not partial slavery because the money is not yours to begin with.
What you "earn" is partly due to your efforts, and partly due to you utilizing
the infrastructure and institutions built by everyone else. So a part of your
"earnings" is society's. That part is called taxes: what you owe to those who
enable you to earn.

We can also put taxes on corporations instead of people. Corporations are not
humans, and therefore cannot be made slaves.

~~~
miscellaneous
>Taxation is not partial slavery because the money is not yours to begin with

Ah, we have found the key contention. An interesting thought is to consider a
world of fully mobile people - who will move and who will stay in a country
with universal basic income and high taxes?

~~~
littletimmy
There are alternatives to high taxes. We could have a Georgism-inspired
economic system in which the land and natural resources are publicly owned and
leased from the state, but what you create is yours alone. That way, there are
no "high taxes" on what you create. The universal basic income is financed
wholly by the wealth from leasing everyone's land and natural resources (which
is much more justifiable because land is always appropriated - never created).

------
kakakiki
After a particular age, there is nothing more frightening than change.

~~~
jazzyk
To some people, there is nothing more frightening than _lack_ of change. And
age has nothing to do with it.

------
squozzer
"Indentured servant" has too many syllables. Peon might be a better term,
because its meaning leans towards economic rather than legal subordination.

------
theGimp
I'm trying to find this book, but coming up short.

Can somebody tell me the name of the book?

~~~
pouetpouet
This is a draft of book yet to be published. In the meantime Fooled by
Randomness and The Black Swan are worth the read.

------
kayman
Its good food for thought.

------
skybrian
Perhaps there should be some equivalent of Godwin's law for this sort of
comparison. Golden handcuffs aren't meaningfully comparable to actual slavery.
If you think it is you're out of touch with history.

The pilot contractor doesn't seem like a great example, either. Contractors
usually have to think about their reputations. I don't know the industry, but
it seems unlikely that there's a huge shortage of pilots, given how poorly
beginning pilots are paid.

~~~
sokoloff
There is a huge shortage of pilots...who are willing to work for the
starvation wages the regional carriers offer.

By the time "Bob" in the story had the status and seniority number to be
captaining a trans-oceanic route for a major, he'd be making well into six
figures a year working 11-15 days a month. He'd have enough to lose that the
Saudi prince would need to pay him his salary until age 65 (mandatory
retirement for part 121 airline flying) to make his choice to walk away a
rational one.

------
slater
I can't tell if this is parody, some kind of "sovereign citizen"-esque
bullshit, or a bit of both

~~~
mintplant
I read through the whole chapter and I didn't see anything sovereign citizen-
esque in there. It's an analysis of the modern employer-employee relationship.

~~~
BorisMelnik
I agree, just read the first 5 or so comments on this thread and it is almost
as if no one even read this post which by the way was an invigorating read.
Great argument of contractors vs employee from an employer and economist
stance.

In summary what I got from it is that if you really want your staff to "be
there" for you then an employee is the way to go. If you want to save money
and have talent, go the contractor route.

