The allocation of profits in startups, at least, feels... problematic.

I was the #2 engineer hire when I was hired five years ago. Since then, we haven't become super successful -- yet -- but we're at least at breakeven. We have three engineers and we're working on a huge new project that hopefully will really grow the company.

I have 1.8% equity.

Sometimes when I'm working late or working on the weekend, which is often, I wonder: Is this really worth it?

I'm totally fine with taking a pay cut to build something new, in order to have the chance at making life changing money. But at the equity I have, we'd need to be quite successful in order to get that.

The VCs who funded our seed and series A (the only funds we've raised) will see the lion's share of the profits. Emotionally, that feels odd. We've thrown a significant percentage of our lives, and they've only thrown in money -- and a pretty small amount of it, really. I know it's supposed to make sense from a financial perspective or whatever, but emotionally it doesn't feel fair.

But hey I guess it worked, I have what feels like a small percentage and yet I'm throwing everything I have at this company. I'm likely an outlier, though. I suspect that if VCs and founders gave employees a bigger piece of the pie, they'd have a much more motivated workforce.

To me it is pretty ridiculous how much labor is taxed, and how little capital is taxed. Especially if we are worried about automation and lack of productivity growth, it seems so counter-intuitive that we are completely stuck to a tax system that devalues workers.

Shocking. SHOCKING, I say.

The recent tax cuts were touted to generate big raises for American workers. A few companies made some news with one-time payouts, but then the rest of that is just being funneled to shareholders.

If a government creates laws that incent shareholder givebacks, you wonder why workers' share of profits aren't increasing?

I think one of the biggest issues in Corporate America is that the pay of upper management is totally divorced from the pay of the common worker. Furthermore, upper manager is often incentivized to fuck over workers because of their preferred stock options.

I am sure it has always been this way but I don't know if it has always been this unbalanced.

you erode worker bargaining power for 30 years and you wonder why they're share of profits is going down. go figure.

Why doesn't the stock market act as a balancing system to low wages? Lowering wages implies higher efficiency thus resulting in higher profits which ultimately end up in "investors" pockets. Why are these "investors" not the common American "worker" whose wages are low? Why has the market not created such an instrument to supplement the "worker" who has low wages but could ultimately profit from the ever-increasingly efficient economy?

This is an honest question whose answer I ponder. Why doesn't the stock market act as a great redistributor of capitalistic wealth?

How can this be fixed? If businesses increase salaries they will likely not meet their quarterly which means investors will punish them. Too many quarters like this and the C-Team gets replaced. This is a sad, pathetic treadmill we are on. I strongly feel we need to go back to annual reporting.

Powell also spoke to this in a recent interview with Marketplace[0]

>Ryssdal: I want to get to the regulatory part of your job, which you address right there in a second, but I want to first talk about some of the things that came out of the financial crisis that we're still dealing with. And maybe the most relevant for consumers in this economy is the idea that wages now for a decade or more really have been stuck. And the question is: As you consider your dual mandates of price stability and maximum employment, where are wages on your list of things to worry about? And what really power do you have?

>Powell: So wages were low, and that was understandable after the financial crisis because unemployment was extremely high. Unemployment was 10 percent in 2009. As unemployment has declined — now all the way down to 4 percent, the lowest it's been in 20 years — we would have expected wages to move up fairly significantly. We now just in the last year or so, we have seen wages move up.

>Ryssdal: A hair, right?

>Powell: We look at a range of — there's no one wage indicator. We tend to look at sort of the four big ones in particular. And if you look back to five years ago, they were all in the low twos — this is annual rate of increase — and now they're all close to three. So there's been this very gradual move up. I think, you know, part of that is that wages should reflect inflation plus productivity. So if you're delivering more output per hour, it should be reflected. Productivity has been very low. But there is still a bit of a puzzle in that we're hearing about labor shortages now all over the country in many, many different occupations in different geographies. And one would have expected, I would have expected, that wages would move up a little bit more. So I think we don't directly look so much at wages as we do price inflation, but I think we're looking very carefully at maximum employment, and that is one of the things that pushes up wages and price inflation.

>Ryssdal: Right. But why are they stuck? Is it just that we're not producing enough widgets per hour? Is it robots? I mean, what is going on? Because that's the thing that people want to know about.

>Powell: So, one big part of the explanation is certainly that inflation has been low and productivity has been low. So productivity just means how much your output per hour increases. And that's what you should expect as a worker to get paid for, is enough to cover inflation plus how much did your output go. So if you take that at the aggregate national level, if you add those two up, that's actually pretty consistent with what's been happening with wages. So again, there's no — I wouldn't call it a mystery, but I would say that it's a bit of a puzzle given how tight labor markets appear to be. And what we're hearing from employers really is that they can't find workers, and you're wondering, well, why aren’t wages going up faster?

>Ryssdal: Why aren’t they paying them, right?

>Powell: It’s a good question. It’s a good question. We don't really have the answer to that question.

>Ryssdal: Which is a little troubling, if you're the guy running the economy.

>Powell: I don't think of myself as the guy running the economy. You know the economy is a $20 trillion economy.

[0] - https://www.marketplace.org/2018/07/12/economy/powell-transc...

Unfortunately the laws and regulations in place facilitating this trend are put in place, for the most part, by elected representatives. For one thing, we need to change “first past the post” election results to decrease the polarizing results that have been shaping our politics as of late. I’m just saying, this isn’t a conspiracy by one party or group. To an extent, it’s the country we voted for.

My daughter is going into the Air Force, getting her degree at night for nothing in 2.5 years, going back in as an officer, effectively doubling her income all the while not paying for food, lodging, medical/dental. She plans on doing 20. She'll likely marry an Air Force officer, and two people retiring at 39/40 YO will have a combined retirement of just under 100k (today's money), all the while not wasting precious money on medical/dental. She'll be young enough to have a second career in her chosen field and if the legislators don't screw up SS, she'll have three retirement incomes.

People need to be taught about investing and the time value of money from an early age. If you invest in some low-cost index funds, you share in the profits. And if you start early, it doesn't have to be a big sacrifice.

Who could've seen it coming except all social sciences and literally mathematics...

What I'm saying is, how are they just now "troubled"? This is all but inevitable barring drastic measures to enforce the opposite trend, at which point it's no longer any recognizable sort of capitalism. Honestly it just seems like a bunch of people receiving numbers they expected and pretending to be surprised.

Cannot read due to EU wall.

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40-50 years ago, a young person fresh out of high school could get a job that allowed them to live the middle class life -- own a house and support a family with only one spouse needing to work.

Nowadays even college graduates struggle to achieve "liftoff."

Globalization has led to a race-to-the-bottom situation where jobs flow across borders, to the places where desperate poverty allows wages to be as low as possible, and the greatest degree of worker exploitation is allowed.

Which is great for those people being lifted out of poverty. And it's great for companies who can more freely exploit workers, and maximize their profits. And it's great for consumers, who get lots of cheap new stuff.

But it totally wrecked our economy's ability to provide a good standard of living for the ordinary person.

Those chickens finally came home to roost in the last US presidential election. There's a lot I don't like about Trump, but I think his tariffs really will make America great again (if they aren't just repealed by the next administration). Because we're finally doing something about this situation.