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How about establishing the environmental protection agency? All the
national museums in downtown DC? Abolishing slavery? I feel like
there are many such examples.
Of course you could make the argument that these things make people
happier, which allows them in turn to create more wealth, but the
causality of the happiness before the wealth is the important point,
the initial action decreased wealth. It's good to build society such
that creation of wealth is not your only objective. Maybe it has to
be your primary objective but only well tempered by others. I would
theorize that the more successful your society is at providing the
basics of survival (i.e. more high tech), the more it can afford to
have other priorities.
The CEO who got rich destroying the non-profit research company was a
snake oil salesman at every step of the way. He preached benefit and
utility and in the end delivered the hollow shell of what used to be
an effective company. The stock values of the companies involved
provided additional indirection and possibilities of get rich quick
schemes which facilitated the process more than a direct sale could
have. He created the illusion of value, while decreasing that value
in the process, got rich while the illusion lasted, and now is in
California on the beach and people here are looking for new jobs.
Same thing. Unethical, but legal. Encouraged supported and enabled by
the way the stock market works.
On Aug 28, 2007, at 12:46 AM, Daniel Reeves wrote:
> I challenge you to name a public policy that increases net welfare
> (ie, utility) while decreasing total wealth.
>
> PS: The snake oil case is simple: no swindling -- it's the same as
> stealing. I see no analogy with short-sighted stock trading or
> overcompensating CEOs. Also, outlawing snake oil increases total
> wealth. (The snake oil salesperson gets richer by $50, the sucker
> gets poorer by $50, sucker gets 0 benefit, both parties lose $5 of
> time: total wealth - 50 + 0 - 5 - 5 = -10. If that 0 were
> more than 10 then wealth would have been created.)
>
>
> --- \/ FROM Dave Morris AT 07.08.27 14:54 (Today) \/ ---
>
>> I do agree that one should err on the side of less government and
>> less regulation as a general rule, as a goal to be aimed for. But
>> that shouldn't paralyze us from action if we don't have a perfect
>> or perfectly known solution but we know we have real problems. No,
>> the free market is not an engineered system. But it is one we can
>> influence, and one that many are trying to influence all the time.
>> The default is that people will try to influence our system to
>> maximize their ability to profit, which is not always in line with
>> maximizing social good. So we have many good regulations on
>> capitalism in place and should continue to. Even though they hurt
>> people sometimes, on the whole they're worth it. We don't allow
>> snake oil salesman to peddle their trade anymore (selling products
>> claiming to have one effect and really having none), even though
>> it's consensual and profitable. I think perhaps we should look at
>> some stock deals and some CEOs that way as well, perhaps requiring
>> more openness about who makes how much, etc., so that motivations
>> are more clear when people take charge of companies and start
>> changing them around.
>>
>> I'd agree with reducing the level of corporate welfare and
>> protection, which starts with reducing the lobbying influence on
>> our government. That would be great, and I'm far more confident in
>> the value/safety of this action than any change to the stock market.
>>
>> But simultaneously, when a small number of people like those who
>> took charge of the not-for-profit research company I spoke of, are
>> able to for personal profit, manipulate the lives of a great
>> number of people without their consent or control- that needs to
>> be regulated. To do this, like the war on drugs which I agree has
>> problems, you need to take a multi-pronged approach to the sticky
>> and difficult to resolve situation. Mostly you target prosecution
>> of the actual crimes (theft, by drug users or CEOs), but also you
>> increase awareness of the issue via education and email chains
>> like this one, and also you try to reduce the motivation for the
>> crimes to break the chain from the other side. (thus my proposal
>> to look at the stock market and maybe place some controls there- I
>> don't have a good war on drugs analogy here :-))
>>
>> Sure there are some companies that benefit from selling out. But I
>> think there are also many that are hurt by it. We could argue
>> without resolution for days because there are so many examples in
>> both directions. But specifically with YouTube, I'd argue that
>> college students would put together sites like that for free
>> because they're sweet, without any motivation of profit. The open
>> source software movement is great proof of this. And I'd further
>> argue that while yes, venture capital and Google have provided the
>> site with the resources to handle the load it currently has, I
>> personally would guess that it would not be as good of a product
>> if it had started off as a corporate profit driven venture. There
>> would probably be registrations and more advertisements and more
>> limitations to guarantee profits, and less just free functionality.
>>
>>
>> There will never be a perfect solution. The balance between
>> capitalism and socialism will always lead to individual cases
>> where something is being over or under regulated. The real target
>> is to reach a point where we have just as many problems pointing
>> towards a need to go more capitalist as more socialist, and then
>> we're at a pretty good point. So don't be too afraid of a solution
>> that might slow down profit, slow down corporate growth, or slow
>> down creation of wealth from time to time and in some cases. Those
>> things are not the end of the world. Sure, creating wealth is
>> good, and we should maximize that. But we should prioritize
>> maximizing the creation of social welfare more.
>>
>> So I think it would be worth the risk to look into ways to tone
>> down the stock market a bit.
>>
>> Dave
>>
>> On Aug 24, 2007, at 11:51 PM, Daniel Reeves wrote:
>>
>>> You're thinking in terms of more government interference. I
>>> think the answer is less. Telling people how much they can pay
>>> each other or what they can buy from who when is dangerous
>>> territory. Even if you don't have a philosophical problem with
>>> it (I kind of do) it simply tends to backfire. Getting rid of
>>> corporate welfare and legal privileges for corporations is a
>>> better place to start.
>>> And I just don't buy the point of your not-for-profit company
>>> example, Dave. Not that I deny that something went awry in that
>>> instance.
>>> The prospect of getting bought out is what motivates many
>>> brilliant startups. That's why we have flickr and youtube.
>>> Certainly it motivated them to add the polish and scale to
>>> support millions of users.
>>> I feel there is a fallacy implicit in proposals along the lines
>>> of Dave's and Trixie's: thinking of the economy as an engineered
>>> system to be tweaked (or in Trixie's case reengineered
>>> altogether). Trying to conceptualize it that way leads to the
>>> dark side! :)
>>> Consider the fundamental difference between a law like "no
>>> stealing" and a law prohibiting/limiting consensual behavior, in
>>> Dave's case buying and selling stocks from each other or paying
>>> each other to run companies. Laws like that require a very
>>> careful argument. For example, "no buying drugs because you'll
>>> become an addict and turn to crime." And of course even that
>>> turns out to be an incredibly bad idea. Focusing our enforcement
>>> effort on actual crime (as opposed to behavior that may or may
>>> not cause indirect harm to society) would be far more effective.
>>> Dave, I do concede the meta argument about falsifiability. Well
>>> said.
>>> --- \/ FROM Dave Morris AT 07.08.24 13:58 (Today) \/ ---
>>>> I guess disagreement with that would be my whole point. The CEOs
>>>> benefit hugely, but the company is less effective than it was
>>>> before at providing valuable research to society, and the
>>>> individuals involved are less well off too, so how does society
>>>> benefit by the company getting screwed? The example I speak of
>>>> was a small research company that was doing its job very well as
>>>> a not-for-profit entity, not a failing company or one that was
>>>> getting left behind by the changing times. It was a valuable
>>>> entity that no-one was getting rich off of, that one person saw
>>>> the opportunity to get rich off of because of how the stock
>>>> market works, and so they did so, without thought for long term
>>>> benefit to the company or society. The stock market enabled this.
>>>> In support of capitalist society, ways to regulate this such as
>>>> controlling CEO salaries or stock deals could benefit long term
>>>> shareholder value, and thus benefit society in the long run by
>>>> optimizing value/wealth creation over time. (the ideas created
>>>> by this company ended up being used by government programs, DoD,
>>>> and others, so the value was getting out to society when it was
>>>> being created, even if no one individual was getting rich
>>>> because of it)
>>>> Extended point- the maximization of profit and shareholder value
>>>> is not synonymous with the maximization of benefit to society,
>>>> and in fact is often quiet opposite. But I guess we'd be doomed
>>>> in coming to any useful conclusions if I expand this thread into
>>>> that other conversation as well. :-)
>>>> I don't have a solution- I haven't come up with specific
>>>> suggestions that would improve the stock market really, and I'd
>>>> readily acknowledge that our system works better than any that
>>>> anyone else is using at the moment. I just see a potential for
>>>> improvement to occur. Figuring out how to do it is the whole
>>>> point of this list, yes? :-)
>>>> Dave
>>>> On Aug 23, 2007, at 12:16 PM, Kevin Lochner wrote:
>>>>> but you're forgetting my point, which was that even if some
>>>>> companies are getting "screwed over", said screwing may benefit
>>>>> society on the whole.
>
> --
> http://ai.eecs.umich.edu/people/dreeves - - search://"Daniel Reeves"
>
> "As far as I know, this computer has never had an undetected error."
>
>
>
Dave Morris
cell: 734-476-8769
http://www-personal.umich.edu/~thecat/
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How about establishing the environmental protection agency? All the national
museums in downtown DC ? Abolishing slavery? I feel like there are many such
examples . Of course you could make the argument that these things make
people happier, which allows them in turn to create more wealth, but the
causality of the happiness before the wealth is the important point, the
initial action decreased wealth. It's good to build society such that creation
of wealth is not your only objective. Maybe it has to be your primary
objective but only well tempered by others. I would theorize that the more
successful your society is at providing the basics of survival (i.e. more high
tech), the more it can afford to have other priorities .=A0 The CEO who
got rich destroying the non-profit research company was a snake oil salesman
at every step of the way. He preached benefit and utility and in the end
delivered the hollow shell of what used to be an effective company. The stock
values of the companies involved provided additional indirection and
possibilities of get rich quick schemes which facilitated the process more
than a direct sale could have. He created the illusion of value , while
decreasing that value in the process, got rich while the illusion lasted, and
now is in California on the beach and people here are looking for new jobs.=A0
=A0Same thing. Unethical, but legal. Encouraged supported and enabled by the
way the stock market works . On Aug 28, 2007, at :46 AM, Daniel Reeves
wrote: I challenge you to name a public policy that increases net welfare
(ie, utility) while decreasing total wealth . PS: The snake oil case is
simple: no swindling -- it 's the same as stealing. =A0 I see no analogy with
short-sighted stock trading or overcompensating CEOs. =A0 Also, outlawing
snake oil increases total wealth. (The snake oil salesperson gets richer by
$50, the sucker gets poorer by $50, sucker gets 0 benefit, both parties lose
$5 of time: total wealth =3D 50 - 50 + 0 - 5 - 5 =3D -10. =A0 If that 0 were
more than 10 then wealth would have been created.) --- \/ =A0 FROM
Dave Morris AT 07.08.27 :54 (Today) =A0 \/ --- I do agree that one
should err on the side of less government and less regulation as a general
rule , as a goal to be aimed for. But that shouldn't paralyze us from action
if we don't have a perfect or perfectly known solution but we know we have
real problems. No, the free market is not an engineered system . But it is one
we can influence, and one that many are trying to influence all the time. The
default is that people will try to influence our system to maximize their
ability to profit, which is not always in line with maximizing social good. So
we have many good regulations on capitalism in place and should continue to.
Even though they hurt people sometimes , on the whole they're worth it. =A0 We
don't allow snake oil salesman to peddle their trade anymore (selling products
claiming to have one effect and really having none), even though it's
consensual and profitable . I think perhaps we should look at some stock deals
and some CEOs that way as well, perhaps requiring more openness about who
makes how much, etc., so that motivations are more clear when people take
charge of companies and start changing them around. I'd agree with
reducing the level of corporate welfare and protection, which starts with
reducing the lobbying influence on our government. That would be great, and
I'm far more confident in the value/safety of this action than any change to
the stock market. But simultaneously , when a small number of people like
those who took charge of the not-for-profit research company I spoke of, are
able to for personal profit, manipulate the lives of a great number of people
without their consent or control- that needs to be regulated. =A0 To do this,
like the war on drugs which I agree has problems, you need to take a
multi-pronged approach to the sticky and difficult to resolve situation.
Mostly you target prosecution of the actual crimes (theft, by drug users or
CEOs), but also you increase awareness of the issue via education and email
chains like this one, and also you try to reduce the motivation for the crimes
to break the chain from the other side. (thus my proposal to look at the
stock market and maybe place some controls there- I don't have a good war on
drugs analogy here :-)) Sure there are some companies that benefit from
selling out. But I think there are also many that are hurt by it. We could
argue without resolution for days because there are so many examples in both
directions. But specifically with YouTube, I'd argue that college students
would put together sites like that for free because they're sweet, without any
motivation of profit. The open source software movement is great proof of
this. And I'd further argue that while yes, venture capital and Google have
provided the site with the resources to handle the load it currently has, I
personally would guess that it would not be as good of a product if it had
started off as a corporate profit driven venture. There would probably be
registrations and more advertisements and more limitations to guarantee
profits, and less just free functionality. There will never be a
perfect solution. The balance between capitalism and socialism will always
lead to individual cases where something is being over or under regulated. The
real target is to reach a point where we have just as many problems pointing
towards a need to go more capitalist as more socialist, and then we're at a
pretty good point. So don't be too afraid of a solution that might slow down
profit , slow down corporate growth, or slow down creation of wealth from time
to time and in some cases. Those things are not the end of the world . Sure,
creating wealth is good, and we should maximize that. But we should prioritize
maximizing the creation of social welfare more . So I think it would be
worth the risk to look into ways to tone down the stock market a bit. Dave
On Aug 24, 2007, at 11:51 PM, Daniel Reeves wrote : You're thinking
in terms of more government interference. =A0 I think the answer is less.
=A0 Telling people how much they can pay each other or what they can buy
from who when is dangerous territory. =A0 Even if you don't have a
philosophical problem with it (I kind of do) it simply tends to backfire .
Getting rid of corporate welfare and legal privileges for corporations is a
better place to start. And I just don't buy the point of your not-for-profit
company example, Dave . =A0 Not that I deny that something went awry in that
instance. The prospect of getting bought out is what motivates many brilliant
startups . =A0 That's why we have flickr and youtube. =A0 Certainly it
motivated them to add the polish and scale to support millions of users. I
feel there is a fallacy implicit in proposals along the lines of Dave's and
Trixie 's: =A0 thinking of the economy as an engineered system to be tweaked
(or in Trixie's case reengineered altogether). =A0 Trying to conceptualize
it that way leads to the dark side! :) =A0 Consider the fundamental
difference between a law like "no stealing" and a law prohibiting /limiting
consensual behavior, in Dave's case buying and selling stocks from each other
or paying each other to run companies. Laws like that require a very careful
argument. For example, "no buying drugs because you'll become an addict and
turn to crime." =A0 And of course even that turns out to be an incredibly bad
idea. =A0 Focusing our enforcement effort on actual crime (as opposed to
behavior that may or may not cause indirect harm to society) would be far
more effective. Dave, I do concede the meta argument about falsifiability.
=A0 Well said. --- \/ =A0 FROM Dave Morris AT 07.08.24 :58 (Today) =A0
\/ --- I guess disagreement with that would be my whole point. The CEOs
benefit hugely, but the company is less effective than it was before at
providing valuable research to society, and the individuals involved are less
well off too, so how does society benefit by the company getting screwed? The
example I speak of was a small research company that was doing its job very
well as a not-for-profit entity, not a failing company or one that was getting
left behind by the changing times. It was a valuable entity that no-one was
getting rich off of, that one person saw the opportunity to get rich off of
because of how the stock market works, and so they did so, without thought for
long term benefit to the company or society. The stock market enabled this.
In support of capitalist society, ways to regulate this such as controlling
CEO salaries or stock deals could benefit long term shareholder value, and
thus benefit society in the long run by optimizing value/wealth creation over
time. (the ideas created by this company ended up being used by government
programs, DoD, and others, so the value was getting out to society when it was
being created, even if no one individual was getting rich because of it)
Extended point- the maximization of profit and shareholder value is not
synonymous with the maximization of benefit to society, and in fact is often
quiet opposite. But I guess we'd be doomed in coming to any useful conclusions
if I expand this thread into that other conversation as well. :-) I don't
have a solution- I haven't come up with specific suggestions that would
improve the stock market really, and I'd readily acknowledge that our system
works better than any that anyone else is using at the moment. I just see a
potential for improvement to occur . =A0 Figuring out how to do it is the
whole point of this list, yes? :-) Dave On Aug 23, 07, at 12:16 PM, Kevin
Lochner wrote: but you're forgetting my point, which was that even if some
companies are getting "screwed over", said screwing may benefit society on the
whole. -- =A0 http://ai.eecs.umich.edu/people /dreeves =A0 - -
=A0 search://"Daniel Reeves " "As far as I know, this computer has never
had an undetected error." Dave Morris cell: 734-476-8769
http://www-personal.umich.edu /~thecat/
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