I don't think he's trying to make any moral judgements. He's just making observations about what actually works within the context of our capitalist system. Capitalism has produced this period of explosive growth centered around technology in the USA and Silicon Valley in particular. And if you are trying to participate in that ecosystem, then you should understand what he says (IMO).
There wasn't any part of the essay which says you should start a startup, or that it is a morally valuable thing to do.
I somewhat agree with you that capitalism doesn't produce optimum value for society. Zynga's maybe an example of that -- I'm sure the are worse ones. But as the saying going, we have the worst system except for all the other ones that have been tried. For all the Zyngas there are some pretty good companies too.
Also, I think your question is essentially hypothetical or philosophical: "should be allow it to?" Who's we? Short of an overthrow of the US government, I think this segment of the economy will exist for a long time.
If you want to have an interesting reflection on capitalism, read "The Idea Factory", about Bell Labs. That is the other end of a spectrum -- a single company holding a monopoly for 50+ years. But it actually produced immeasurable value. It's interesting to think on which model produces more value -- a monopoly where people are free from competitive pressures, or an intensely competitive market.
You made great points, but I disagree about the morality part.
Wall Street had also produced explosive growth in our economy. It was also a ingenious system with participation of lots of hackers and talents. But I think most will agree now, that when Wall Street operates without considering its own morality, it is by itself, immoral.
In other words, I believe the essay's lack of reflection on the morality issue, which is definitely not a small one (e.g. the Zynga example), is what makes it biased, and partly, immoral.
OK, but you're making an observation without a solution... that kind of thing is pretty much irrelevant to people like Paul Graham and CEOs of startups, who have to make decisions about what things to do. You can call people immoral from the sidelines but it will have zero effect.
My opinion is that corporations are essentially "amoral" -- not immoral. Morality simply doesn't enter into any substantive decision. Google's founders often invoke the self-interest argument: "people don't have to trust us to be moral, because if we acted against our users, they would leave us, and we wouldn't make any money". This is what I call an amoral argument -- with no negative connotation to "amoral". PG almost invoked a version of this in footnote 8.
You might think that being amoral is equivalent to being immoral, but morality isn't as well-formed a concept as people think it is. Namely, the most common use of the concept of immorality is to label "stuff I don't like". I mean, what's wrong with millions of people playing Zynga games all day? Would people be curing cancer if they weren't playing Zynga games?
Another issue is that a person isn't moral or immoral; it's well known that the same person will act moral or immoral according to their environment. Paul Graham even said that about HN (in terms of trollish behavior). (See http://en.wikipedia.org/wiki/Fundamental_attribution_error)
In the case of Wall St, there's no possibility of it "considering its own morality". No amount of goading or convincing will make an ounce of difference. The only way I can think of is for voters to make it clear to elected officials that they won't tolerate the status quo, but so far that hasn't happened. Even after the 2009 crash.
(And btw I didn't make any assertion about morality in my original message, other than to say "I somewhat agree" about Zynga, so not sure what you are disagreeing with.)
I appreciate your response, and I fully understand the realistic angle that you have provided.
But I have to clarify that I am not calling pg immoral. I am suggesting the essay could be. People outside the game industry may not get the Zynga problem, but you can also look at, say, Groupon's controversies. "Immoral" could indeed be too strong a word, but I believe few will disagree that aggressive growth strategies has some inevitable side effects, and for this no amount of footnotes is sufficient.
But again, call me naive, "people like Paul Graham and CEOs of startups" should, contrary to what you claim, should care MORE about these problems, because they can certainly afford to, and when they do, it will matter. :)
OK... well I think your point is that PG's essay is "amoral", which is true. It doesn't say anything about whether hyper-growth is a thing we should value (as human beings, not as money making machines).
Actually ALL his essays are amoral. PG is very precise. He doesn't advocate specific things; he lays out a set of deductions. You will come to the same conclusions IF you have the values he supposes. IF you value this, then you should believe that. Which is a true statement regardless of what you believe.
My point is that amoral != immoral. But I think you are saying they're the same -- that all decisions must have a moral component or they are immoral.
I agree that hyper aggressive growth doesn't always produce the kinds of companies that society "should" want... but sometimes it does! It's probably impossible to separate the two, not least because everyone has different opinions on what's valuable.
I don't read that essay as having much morality. I think YOU are reading your POV into it.
There is an assumption that a monopoly by MS would be dangerous. That's not a particularly judgmental stance. I could imagine someone having a different belief system about monopolies, but it hardly seems like a moral claim.
Then he is saying that he prefers to work with an economic partner rather than under the employer-employee system. He doesn't say it is morally right. He says that business can learn from this, because it would make the business more productive. That's an amoral argument. He's invoking economics to justify a way that people should interact.
It's basically a libertarian argument, and in general this type of argument is agnostic about morals.
There wasn't any part of the essay which says you should start a startup, or that it is a morally valuable thing to do.
I somewhat agree with you that capitalism doesn't produce optimum value for society. Zynga's maybe an example of that -- I'm sure the are worse ones. But as the saying going, we have the worst system except for all the other ones that have been tried. For all the Zyngas there are some pretty good companies too.
Also, I think your question is essentially hypothetical or philosophical: "should be allow it to?" Who's we? Short of an overthrow of the US government, I think this segment of the economy will exist for a long time.
If you want to have an interesting reflection on capitalism, read "The Idea Factory", about Bell Labs. That is the other end of a spectrum -- a single company holding a monopoly for 50+ years. But it actually produced immeasurable value. It's interesting to think on which model produces more value -- a monopoly where people are free from competitive pressures, or an intensely competitive market.