Greed is good

[boris-the-spider]

@furion writes in https://steemit.com/startups/@furion/how-should-we-pay-ourselves about how crowdsales should remunerate founders and employees.

I couldn't disagree more strongly, and here's why. Greed is good.

$5,000 a month for everyone, means the end of the market for talent. It also means the end of the market for taking responsibility, for having the buck stop with you, . Every achievement we make ultimately comes about through greed, because as rational actors people do what the market rewards - when we give the chimp more bananas for doing what we want, the chimp responds.

I don't want the chimps in charge of projects in which I've invested disincentived so they have no reason to create value for me. I want them to greedily work to line their own pockets so that mine, in turn, will be lined as well.

Blockchains are a perfect example, the reason that PoW blockchains can be secure is because miners greedily attempt to snatch up as much of the money as they can for themselves. Traders attempt to greedily pay as little for the money as they can, and to sell it for as much as possible. Merchants greedily attempt to buy goods as cheaply as possible, and to sell them for as much as they can get. Producers greedily attempt to extract as much value as they can for goods they've produced as cheaply as possible. Developers greedily attempt to generate as much value out of the least work possible to increase the value of their holdings. Early investors attempt to greedily take as much future upside potential as they can get for as little risk as possible.

Ultimately, this process of attempting to get as much as possible, for as little as possible, is how you're now sitting reading this on your marvel of modern technology, instead of scraping around in the dirt for berries.

In fact, if we follow the argument far enough, we get right to the root of what money, whatever form it takes, represents - money represents the value of progress - when something is worth money, that means we value it, and since people as a group, although usually rather stupid, do manage to exercise at least a modicum of sense when it comes to valuing and preferring things that improve the quality of life, that's how we get from caves and berries to houses, computers and Steem. Money is simply a way to make virtue fungible, divisible and durable.

In fact, it's greed also that motivates ideas like those in Furions post - the greed that wants to take the results of the work of people who earn more in the open market, and keep it for the rest who don't earn as much. To take from the rich (in ideas, capacity for taking responsibility, capacity for taking risk, capacity to produce value and drive organisations to do so) and distribute their rewards to everyone else - that's not "fair" any more than it would be "fair" to distribute the most popular posters Steem to everyone else so we had a flat "5000 STEEM a month for everyone" policy, a sure way to ensure that absolutely no-one has any incentive to produce good content.

Moving on from flat, equal salaries, we get to the "offsite gathering with goals of reviewing past progress, strategy and team bonding", otherwise known as a huge waste of money and time that invariably comes to corporates whenever they get big enough to have an HR department full of hand-wringers who never create anything of value but instead exist it seems, solely to suck value from the activities of the company by guilting, threatening and coercing everyone in the company into complying with "codes of conduct" and other such nonsense that amounts usually to a hostile takeover from within.

What if I don't want to "review past progress" or "bond" with you? What if I don't give a fuck about your feelings and prefer to spend the day actually making, you know, some money? A company isn't a democracy, and it shouldn't be, those with money at stake not only should control the decisions about what progress means, but they ultimately must, because if they vote with their money to put it elsewhere where they greedily perceive themselves to have a better chance of making a return, you don't have a project any more.

The idea that "Founders should not be entitled to a stake just because they started something" is, in a strange way, true. I can "start something" today, that has no perceived value to the market - I can say I want a 99% "founder share" in it, I can say I want 1%, it doesn't matter because if people don't invest in it, my reward is nothing.

When people create things that other people find worthy of investing in, that's the only type of vote that counts - skin in the game. People voting with their wallet reward projects they think will make them money, that's greed at work, and it's good.

If you don't want projects with overpaid founders who received more in payment than the value they created, it's up to you as an investor to research your investments properly, establish an opinion regarding the value they will create, then vote with your wallet on the projects you think the market has undervalued.

Comments

[aaronsthilaire]

Interesting insight. I love money, but I like to use it for non-greedy things as well. I guess wanting to give is greedy because I WANT to do it.

To your point about the $5,000/month, I think everyone that deserves it should get it. But if they're not adding value to the marketplace, that's a weak greed.

Thanks for posting!

[boris-the-spider]

Thanks for replying. Exactly - I want to give too, altruism derives in a way from greed as well, debasing yourself by just pursuing money at the expense of everything else good in life is not really optimal, but I have a lot of faith in the ability of greedy people to produce good things.

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