You’re right that the claim that “being a billionaire requires exploitation” is massively oversimplified. But the situation you’ve described is essentially winning the lottery. Yeah, you put the time into think of, and execute on an idea, but everything else, from having the time to work on a possible flop, to it being a hit with 300 million people is ultra luck-based. 1000 people could do the exact same thing, and 1 might hit it big. It’s gambling.
A more accurate phrasing of the original statement is: the only way to reliably amass billions of dollars in wealth is to exploit a supply/demand gap to the point of unsustainability.
A small business that operates with integrity, prioritizes the wellbeing of their society over their profits, doesn’t price gouge, and doesn’t discourage healthy competition will never become worth billions. They will always lose to competition that is willing and allowed to forego ethics for profits.
So 100 people could try your strategy of making a game that goes viral, and none of them are going to do it, most probably won’t even make a profit. But then 100 people could try the strategy of exploitation, and they’re going to reliably turn a profit. We allow a society where exploitation is a good investment.
Regardless of what people think of Peter Thiel he says out loud exactly what is wrong with late-stage capitalism: competition is for losers.
Firstly, it’s no more luck based than any other method. There are less than 3000 billionaires in the world. If there was an even pseudo-reliable system to become a billionaire, there would be more than 0.00004% of the population who’ve managed it.
And selling a popular video game is just as much “exploiting a supply/demand gap” as any other method. You have an effective monopoly on an asset that people want.
All that to say, I’m pushing back on the “massively oversimplified,” because it’s not, it’s just counterfactual.
I wouldn’t have minded if the OP had said “the overwhelming majority of billionaires got there by exploiting the working class.” That’s just as “massively oversimplified” as what they did say, but isn’t objectively false.
You’re not describing a situation where your made a series of investments with a high ROI, you’re describing a “one-hit-wonder” scenario. Ask any successful game developer and they’ll all (sorry, the overwhelming majority will) tell you that making a viral game as you’ve described is hugely luck-based.
Similarly, all (sorry, the overwhelming majority) of those 3000 billionaires would agree that you don’t amass their amount of wealth via a one-hit-wonder. Yes, it involves the fortune of having the opportunity to exploit others (usually born to already wealthy families), but then also requires a pattern of exploitation (I think they’ll be less willing to admit that one. Maybe Theil would.)
If you’d like to adjust your hypothetical scenario to not be based off of a one-hit-wonder, and instead model a sustainable pattern of good investments, go for it. But I believe I’ve already addressed that possibility with my “small business” example in the previous post. It simply doesn’t happen.
Yes, anything that turns a profit is based on a supply/demand gap, the key word I used was “unsustainablely”. I’m not talking about selling a video game for $100 when players want to pay $20, I’m talking about selling the cure for a disease for $10000 when it costs $1 to make. Price gouging. Exploitation.
So, I just looked at the list of the top ten billionaires. It includes: Mark Zuckerberg: Facebook (one hit wonder) Jeff Bezos: Amazon (one hit wonder) Bill Gates: Microsoft (one hit wonder) Larry Page: Google (one hit wonder)
There are several other examples in the top ten list that are lesser known but also one hit wonders, but even if there weren’t, that’s 40% right there.
I suppose you could argue that those companies do more than one thing, especially Google, but the vast majority of the cash flow for each is behind one product or line of products.
The only differentiator between any of them and Notch is that Notch was a one man team, and therefore wasn’t “exploiting the capital generated by his employees.”
And let’s be real here. You say that a small business can’t grow to be a multi-billion dollar business? Tell that to literally any of the above. Microsoft started in Gates garage. Facebook was a college project. Almost all businesses start as small mom-and-pop shops. Some do in fact become multi-billion dollar businesses. Just not the vast majority because, again, it’s based on luck.
And look, you keep circling back to try and paint what I’m saying as “it’s fine for billionaires to price gouge medicine and stomp homeless people to death” or something. That’s not what I’m saying no matter how many times you circle back to it.
To repeat ad nauseum, the only point I’m making is that it’s in fact possible to become a billionaire without exploiting other people’s labor. Full stop. No other point beside that. If we agree on that point, then we are fully in agreement. That is, again, the only point I’m arguing.
