Anti-Tesla sentiment and the death of optimism - <AUTHOR> http://cjohnson.io/2014/tesla <comment><USER4> I've been thinking of patents as nukes during the Cold War lately.

Superpowers (US/USSR, Apple/Google) acquire very large nuclear/patent arsenals under the guise of protection/defense. These arsenals are relatively cheap for superpowers to build, but they are expensive for small states (small countries/small businesses) to acquire.

The US and USSR were roughly equivalent in their arsenals so it made little sense for either party to act offensively. However, the implied power behind the arsenals gave them a lot of power when dealing with smaller actors. The superpowers benefit greatly from acquiring these arsenals. Even without using them publicly, the threat can always be used behind closed doors (as Jobs has been shown to do).

But there's a third actor; the most universally feared actor: terrorists/patent trolls. These actors behave only offensively because they have nothing to defend. These actors are best poised to benefit from nukes and patents and can send an otherwise orderly system into chaos.

Anyway, just a fun but flawed analogy to play with in your noodle. :)

<comment><USER5> Interestingly, this analogy works very much at the company level, but reverses at the country level.

For companies, patents represent weapons in an arsenal, in which MAD prevents offensive action, as you've said.

For countries, the reverse holds: a country that jettisons its patent architecture, or never evolved a restrictive one to begin with, will be a bastion for innovators. The stable equilibrium is no bad patents - a lack of shallow protectionism - and the only reason patent law in the US has remained constant for so long is because of the other advantages that have given it technological and scientific primacy.

As those advantages erode, patent law will loosen to stimulate competition. Perhaps there is an upside to the perception of decline?

<comment><USER6> I think you need to append "for software or business methods" liberally.

For products where development costs dwarf manufacturing costs, patents provide the incentive to do stuff. Would anyone invest a few billion into a drug if anyone with access to a few million bucks could go manufacture it?

<comment><USER7> I've always enjoyed "Against Intellectual Monopoly" (read free online here: [http://levine.sscnet.ucla.edu/general/intellectual/against.h...](http://levine.sscnet.ucla.edu/general/intellectual/against.htm) ), which has a chapter ([http://levine.sscnet.ucla.edu/papers/ip.ch.9.m1004.pdf](http://levine.sscnet.ucla.edu/papers/ip.ch.9.m1004.pdf)) that specifically addresses this.

<comment><USER8> I would be wary of taking that book at its word. The authors have an agenda and they are not afraid to twist historical facts to suit their narrative. I mean, their very first chapter begins with a lie which perpetuates the myth that Watt's patent retarded steam development [1].

When the authors of [1] called out Boldrin and Levine on this, the latter responded by fabricating new myths rather than admit that the truth undermined their narrative [2].

The very chapter you cite itself has such inaccuracies. I did not track down all the stuff they cite, but I did find an instance of mischaracterizing references to suit their view points. For instance, when they discuss the German dyestuff industry, they cite a study by Murmann to support their narrative that Germany dominated in that industry due to the lack of patents. But if you look at the actual study itself, Murmann paints (heh) a much more nuanced picture. German dominance in that industry was fueled by close ties with academic research, and later by R&D labs encouraged by, of all things, the newly introduced patent laws:

 _> When in 1877 German patent law protected dye innovations, a few German firms such as Hoechst, BASF, and AGFA saw the advantage of hiring organic chemists whose sole task was to synthesize new dyes. After these research chemists turned out economically successful dyes, firms hired more and more chemists and pioneered an entirely new corporate function, formally organized research. The birth of corporate research and development (R&D), which today is a standard activity in high-tech industries ... can be traced to the German synthetic dye firms in 1880s. By the 1890s the vast majority of dyes were being discovered in the R&D laboratories of Bayer, Hoechst, and BASF.

> Whereas in the early days of the industry a firm could exist by copying dyes > invented somewhere else, patent laws made the systematic application of > science within the boundaries of the firm a critical dimension of remaining > a leader in the industry._

And elsewhere:

 _> The most important institution in the early success of the German dye industry was the university system, but patent laws were a second key factor that allowed the German firms to capture a dominant position._

With that many assertions in the study that refute their view, they cherry- pick a few comments and actually cite the study as one that supports their view.

With so many mischaracterizations in there, I find it hard to take anything else they say in that book at their word.

1\. [http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1589712](http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1589712)

2\. [http://econpapers.repec.org/article/bpjrlecon/v_3a5_3ay_3a20...](http://econpapers.repec.org/article/bpjrlecon/v_3a5_3ay_3a2009_3ai_3a3_3an_3a7.htm)

3\. Murmann JP, 2003, "Knowledge and Competitive Advantage – The Coevolution of Firms, Technologies and National Institutions." \- [http://catdir.loc.gov/catdir/samples/cam041/2003043048.pdf](http://catdir.loc.gov/catdir/samples/cam041/2003043048.pdf)

</comment></comment></comment></comment></comment><comment><USER9> I enjoyed your post. I have a couple of thoughts / suggestions for you.

I got the impression that the underlying motivation for writing the post, and tactic you used for justifying your positions was largely in response to what I would consider the overly myopic hacker news user base. That is, disproportionately white, male, curmudgeoney programmers. I sympathize with your frustration, but urge you not to let their world-view cloud yours, or cause you to search for complicated answers to simple questions.

An example of what I mean:

> I believe the current skepticism around Silicon Valley's "Make The World a > Better Place" mentality is deeply rooted in historical anxiety about > institutional capitalism.

On this point, I urge you to consider a much simpler explanation: that people are skeptical because there is much to be skeptical of. People like Musk are a rare breed in Silicon Valley. Today's tech "entrepreneur" rarely looks like Elon Musk, someone who genuinely seems to want to do good things for the world. The skeptisism exists because there are a lot of startups doing plain silly things, masked in global do-goodery marketing narrative.

Startups are the new gold rush, today's investment banking. But the west coast has much different cultural norms towards opulent wealth than does the east coast. Put simply, we like to hide it out here, they like to flaunt it out there. Thus, "we're making the world a better place" instead of something like _The Wolf of Wall Street_.

Still, I enjoyed your post and your choice of using macro-economic theory as a lens through which to view this. Thanks for writing.

<comment><AUTHOR> Actually, I agree with you more than you'd think. After living in San Francisco for a year or two, I'm absolutely skeptical toward 99% of the stuff that's passed off as "Silicon Valley revolutionary" crap. I'm pretty much only interested in pure technology: SpaceX/Tesla, new hardware manufacturing / internet of things, drones, immersive computing, bitcoin (to some extent), etc.

Which is why, I think, I can enjoy the HBO show thoroughly while still lamenting about "where did all the hackers go"

<comment><USER10> The hacker has been partly replaced by the hustler, and that sucks. But there are still hackers around.

There's also things that the hacker can learn from the hustler, like how to take something early or minimal and make it self-supporting. In a sense the hustler is a kind of hacker. The problem is that hustlers are often just hustle... not enough substance. But when you have substance _and_ hustle, that's powerful.

I do get turned off by all the self-congratulation coming out of the Valley. It's important to listen to criticism. Sometimes the critics have a point. In particular, a lot of the optimism out of the valley sounds dangerously close to "let them eat cake!" to the rest of America. (News flash! Most of America is more or less in a long shallow depression right now.)

</comment></comment></comment><comment><USER11> Trust is not a binary decision, it is a continuum. And within that continuum, the US is way further to being a trusting society than not. When we sign a contract, we have an expectation that it will be fulfilled, and that if it isn't, the courts will work, albeit slowly. You get a job, and you tend to get paid. Go in a cab, not expect to get robbed, or murdered. If you hire an employee, you expect him to at least attempt to do his job. Is someone does a good job, there's a chance there's some reward behind it.

There's a reason Southern Europe has worse economic outcomes, and that's trust. You get even worse results as you move towards the development world. And many parts of South America make Southern Europe seem downright trustworthy.

It's important to have a high trust society, but it's really more of a systemic trust than anything: About having negative consequences to breaking trust, not about taking leaps of faith to trust companies.

<comment><USER12> > There's a reason Southern Europe has worse economic outcomes, and that's > trust.

I have no idea where you got this impression from. It is wrong, though. I did business in several southern Europe countries, and you can seal a deal with a handshake and be confident it'll go through.

<comment><USER13> > It is wrong, though.

As an Eastern European, I think he got it right. From my own experience, there's a huge difference in trustworthiness between the Western and other countries/regions.

I have tons of stories to support this, but here's just one: in supermarkets in my own country, you're not allowed to walk in with a backpack (you have to seal it outside or leave it in a locker); I've never had to do that in the US.

</comment></comment></comment><comment><USER14> Playing devils advocate, I'd say sure, it sucks that some (or most) people are selfish dickheads leading to mutually degrading situations. But it would suck almost as much to always be at mercy of your competitors good will (that he won't arbitrarily screw you, leave unpunished _and_ with a better outcome), even if it happens sparsely. The obvious solution to this fabricated game theory dilemma is regulation, which is nothing more than eliminating those scenarios which are undesirable for society altogether. Not only it avoids the risk of being screwed, or the costs associated with being screwed, or the loss of optimality of outcomes -- but most importantly it simplifies greatly the game. Markets are quite complex already and the added constraint of having to think hard about your _oponents_ and consider all the scenarios to make sure you're not screwing them is enormous. I think this behavior is distinct from bad faith, it's just a matter of responsibility and scope.

This, to me, is ideal capitalistic behavior: oblivious, but with good faith (not trying to 'unfairly' or 'destructively' bring down your opponent) -- and it should come with swift regulations and laws flexible enough to punish edge cases.

We have a truly unrecognized _gift_ as a species: morality. Not because it's cute or honorable (that would be a circular assessment), but because it allows us to reach those Pareto optimal spots. We just have to use it in proper settings, with proper rules.

<comment><USER15> In this story, it's regulation that has put some companies at the merci of competitors. Small Startup Y has to hope that Big Corp X wants to license a patent for a fair $ amount. Startup Y has no way to negotiate a large fee down to an acceptable level, pay the expensive licenses or fight in court if they ignore the patent.

Considering two companies with patents, you get the Nash equilibrium where both companies go to court for patent infringement (assuming the plaintiff always wins). The payoff matrix could look like this, where the numbers are the changes in profits in %.

                | court    | not court
      </comment></comment><comment></comment><comment></comment><comment></comment><comment></comment><comment>---
      court     | -5 \ -5  |  -15 \ 10
      </comment><comment>----|</comment><comment></comment><comment></comment><comment>----
      not court | 10 \ -15 |  1   \ 1
      </comment><comment></comment><comment></comment><comment></comment><comment></comment><comment>---

Assume the profit of the previous year is 14%.

      - If no company goes to court, both profits grow slightly with 1% to 15%.
      - If one company goes to court, and the other doesn't, the plaintiff's profit increases with 10% to 24% and the defendant's drops with 15% to -1% (placing it a loss).
      - If both companies go to court, the profits of both companies drop with 5% to 9%.

If you want a real-life example of this situation, just look at the lawsuits between Samsung & Apple. Probably the only case where they'll evolve to the pareto optimal solution, is when patents no longer exist at all.

A world without patents would allow companies to win customers based on pure attractiveness and features, not by getting competition banned. Note that this isn't the same as giving your key designs away for free. It means I could reverse engineer an iphone touchscreen and create a compatible version, without being sued by anyone. Apple would still have the early mover advantage with existing customers; the consumer would have more/better/cheaper choices and i would have a more attractive product. (Note that this might not be the case for other sectors, like pharma, where it costs a lot to develop a new drug from scratch, rather than the cheaper additive innovations in the tech sector).

</comment><comment><USER16> The author is seriously mistaken about game theory. The Nash Equilibrium requires every player to be maximizing their payoffs given what the other players are doing. But game theory itself does not say what the nature of the payoffs are: there is no problem in modelling altruistic players who attach a high payoff to outcomes which are good for everyone and low payoffs to outcomes which benefit only themselves.

The Pareto Optimal is not an outcome which is best for both, since the whole point of this concept is to avoid giving a definition of "best for both". Rather it is an outcome from which no player can be made better off without making some other player worse off. So, for example, for two greedy people sharing a cake, any division of the cake, including one which gives the entire cake to one person, is Pareto optimal.

Anyone seriously interested in understanding what game theory really says and avoiding superficial mistakes in its interpretation should read at least the first chapter of Binmore's 'Playing for Real'.

<comment><USER17> I think when you allow for altruistic players, the core insights you get from game theory tend to vanish.

I think the author had that part mostly right, actually.

<comment><USER16> But if you really are a selfish player, and you have somehow persuaded the other player to trust you and play "deny" then you should definitely play "confess" to maximize your payoff. With selfish players there is no way to move to ("deny","deny") in a one-shot Prisoners' Dilemma. Cultural change cannot help unless it amounts to a change in payoffs.

[The story would have been different in a coordination game with multiple Pareto-ranked equilibria where a change in beliefs can move you from a bad equilibrium to a good equilibrium.]

</comment></comment></comment><comment><USER18> Author is very unfair to the "capitalist environment like America's". Our market-driven society requires, and rewards/trains, a level of trust that's less-common elsewhere. Just two data points:

(1) Americans are "The Weirdest People in the World", per one review of psychological studies, in economic games. They're more willing to punish 'unfair' offers in the 'Ultimatum Game', and offer higher shares against naked self-interest in the similar 'Dictator Game'. See for more details:

[http://www.psmag.com/magazines/magazine-feature-story- magazi...](http://www.psmag.com/magazines/magazine-feature-story- magazines/joe-henrich-weird-ultimatum-game-shaking-up-psychology- economics-53135/)

(2) We've had a number of explicitly "anti-capitalist" nation-states in the last 150 years. They haven't been paragons of collective action for the greater good, or protection of the common environment. In particular, the ex- Communist societies and emigrants-from-same sometimes take a while to adjust to new economies where every stranger, government and non-government alike, isn't constantly trying to screw them under false pretense of shared- sacrifice.

The actual games in "capitalist America" are only very occasionally dog-eat- dog zero-sum affairs. More often, they're iterated games rewarding not just consciously chosen cooperation but an optimistic, cooperate-by-default mindset. Politics, with its zero-sum elections and redistributions, is an exception. _Its_ partisanship shouldn't be attributed to market processes, but to electoral/governmental ones.

</comment><comment><USER17> _This explains, at the very least, why rampant partisanship is an inevitability in a large Democracy, despite it being worse off for everybody (including politicians themselves)._

Instead of saying "in a large Democracy" it should say "in a large Democracy which uses plurality voting." Some voting systems (for instance Condorcet compatible ones) do not encourage partisanship in the same way as plurality does. In fact other systems actually encourage cooperation and favor candidates that are more in the center.

And I think that points to a flaw in the conclusion of the article: attempting to directly change human nature (or culture, as the OP suggests) is a fool's errand.

Instead, changing the rules of a system, such that the Pareto optimal result and the Nash Equilibrium align more closely, is a much more realistic approach. And I believe that when you do set up good systems where people are rewarded for cooperating, the culture changes with it.

(Regardless I think it is an excellent article and the more people who understand the Game Theory stuff he explains, the better. And I absolutely agree with his sentiment than Musk should be lauded for what he is doing rather than being met with cynicism.)

<comment><USER19> > In fact other systems actually encourage cooperation and favor candidates > that are more in the center.

Actually, single-round winner-take-all democracy induces a race toward the middle, _not_ polarization. (If everyone is aligned on a 1D spectrum and votes for the candidate closest to their position, then both candidates are incentivized move toward the median position.)

What you're really getting at isn't the idea of polarizations versus moderation, it's voting coordination (i.e. political parties) aka collusion. Unfortunately, alternate voting systems don't eliminate collusion, they just push it to a different level (e.g. proportional representative systems still have 51% coalitions at the level of parliament). You might reasonably argue that that's a better level to put that collusion, but it's definitely not eliminated through some simple choice of voting system.

If you _really_ want to eliminate collusion and induce consensus making, you can consider "randomized parliaments". They operate in a way very analogous to the mechanism that makes poker showdowns rare. Although he chooses an unfortunate name of "quantum parliment" (since there's nothing quantum about the randomness), Aerts explains the idea well here: [http://arxiv.org/abs/physics/0503078](http://arxiv.org/abs/physics/0503078)

<comment><USER20> Arguably, what we've seen happen in practice is _both_ a race toward the middle _and_ polarization - the two parties and their supporters become more and more hostile, aggressive and unwilling to compromise over an increasingly small set of differences between the two.

<comment><USER19> Yes, I think that's right. I was really criticizing the idea that winner-take- all deomocracy is not a system that "favor[s] candidates that are more in the center". "Polarization" was a poor choice of words; I think "extremization" would have been better.

</comment></comment></comment></comment><comment><USER21> Patent discussion aside, I just want to point out that battery powered cars are NOT the solution to global warming, at least not at the current state of technology. Aside from all the environmental damage involved in producing the lithium cells them selves, you have to also consider that to charge those cells we are still burning cola and then transmitting that power over an incredibly inefficient, almost 100 year old power grid (in US).

In fact, given the environmental damage from production of a new car combined with environmental damage from production of lithium batteries, combined with CO2 emissions from the cola burning power plants and nuclear waste from the nuclear power plants, I would argue that the earth is better off if you were to drive an older F150 pickup truck for another 300k miles, rather than buy a new Tesla. If you have an option though, you should choose something more efficient.

But overall, I just wanted to point out to anyone who is honestly concerned about global warming. Driving your current car for longer (assuming it's reasonably economical), and investing the money into fixing it up and getting more miles out of it is way better environmentally than buying a new car. Remamber, repair > reuse > recycle > replace.

<comment><USER22> Your point should've been "transportation emissions are only a small share of total CO2 emissions". If you want to reduce CO2 emissions, you should start by becoming a vegan.

<comment><USER23> > If you want to reduce CO2 emissions, you should start by becoming a vegan.

I'm going to regret this, I have no doubt.

Vegan != no carbon footprint. In fact, I would imagine that when compared to a typical vegetarian diet, it is less carbon efficient.

Isolation from animal (by)products means that food bound for vegans typically requires specialized handling and processing. Loss of efficiency gained from the economies of scale.

Limited food processing means that food can not be easily stockpiled and distributed. This results in more frequent but smaller food shipments - <USER2> opposite direction you want to go for efficiency.

The small intersection with the average person's diet also means that vegan foodstuffs don't gain any production efficiency when compared to, say, a vegetarian's diet.

All of that, and vegan-bound foodstuffs still have to be planted, fertilized, harvested and transported.

<comment><USER22> >Vegan != no carbon footprint.

Well, no sane person has claimed that.

>In fact, I would imagine that when compared to a typical vegetarian diet, it is less carbon efficient.

Your imagination is not consistent with reality/studies.

[http://shrinkthatfootprint.com/food-carbon-footprint- diet](http://shrinkthatfootprint.com/food-carbon-footprint-diet)

>Isolation from animal (by)products means that food bound for vegans typically requires specialized handling and processing.

The average vegan food is a lot more efficient than any animal product. An animal is just a biological machien which converts plant matter to animal products. You could take out the inefficient converter and just eat the plant directly. For example, 99% of soy in the United States is eaten by animals.

>Limited food processing means that food can not be easily stockpiled and distributed.

What? There's no special truck for vegan products. Supermarkets ship vegan and non-vegan products together.

>All of that, and vegan-bound foodstuffs still have to be planted, fertilized, harvested and transported.

Yeah. And because animals eat plants, the average omnivore consumes more plant matter than the average vegan.

<comment><USER24> _" The average vegan food is a lot more efficient than any animal product. An animal is just a biological machien which converts plant matter to animal products. You could take out the inefficient converter and just eat the plant directly. For example, 99% of soy in the United States is eaten by animals."_

Not that this destroys your thesis, but some animals happily eat things humans won't. A pig fed leftovers is going to be more efficient than sending those leftovers to landfill. People don't eat much grass. &c. This is, of course, mostly irrelevant to how we actually feed ourselves in the developed world (where, for instance, pasture would serve other uses).

</comment></comment></comment></comment></comment><comment><USER25> > A "Pareto optimal" solution is one which, given all the possibilities of > action, produces the best outcome for both parties (with some negotiable > surplus).

This isn't quite right. In a Pareto optimal solution, there's no way to improve things for one party without making them worse for another party, but there's no guarantee that the outcome is good for everyone. "I get everything, you get nothing" is a Pareto-optimal way of diving things up.

<comment><USER26> That still isn't quite right. Pareto optimal better describes transitions than states. A state can be described as Pareto optimal only in the sense that there are no Pareto optimal transitions out of it. So for example, in prisoner's dilemma, all of the states are Pareto optimal because none of the moves are. No matter what anyone does, somebody will be worse off than the alternative.

As another example, "I get everything, you get nothing" isn't necessarily Pareto optimal because there could be something non-rivalrous that the person getting nothing could have without depriving the person getting everything of it.

<comment><USER27> Agreed. Seems like the author is looking for something more along the lines of "socially optimal." Also seems like he mixed up which outcome is Nash and which is socially optimal. (Deny, Deny) = (Defect, Defect) = Nash Eq. (Confess, Confess) = (Cooperate, Cooperate) = socially optimal.

</comment></comment></comment><comment><USER28> The idea that the Pareto-optimal situation is the one where everyone freely copies from each other may be appropriate for the market Tesla finds itself in, but is in general directly contradicted by the actual experience of the technology industry.

The experience of the technology industry is that innovation happens in periods of monopoly. That monopoly might arise from first-mover effects, network effects, lock-in effects, or IP protections (patents, copyrights, and trademarks). This has been true from Bell Labs to Xerox to Google to Facebook. Bell Labs had its heyday when AT&T was a government-sanctioned monopoly. The Xerox Alto, which pioneered the GUI, the mouse, and networking, was invented at a Xerox that had 100% of the U.S. copier industry, a few years before an antitrust consent decree forced it to license its patents to Japanese competitors, quickly destroying its marketshare.[1] If another search engine could easily copy Google's data and algorithms, they wouldn't have the money to be working on self-driving cars and AI. Facebook is a textbook example of network effects precluding perfect competition.

In comparison, look at the PC industry, which is based on open standards and an OS licensed on non-discriminatory terms. What has happened to the PC? They have become commodities and innovation is essentially dead. Companies like Lenovo eke out single-digit profit margins, and nobody can afford to spend money on R&D.

[1] [http://en.wikipedia.org/wiki/Xerox#1970s](http://en.wikipedia.org/wiki/Xerox#1970s)

<comment><USER29> I think you've cleverly bundled together a couple of meaningless correlations. Yes, there's a grab bag (but, in my opinion, not much more than that) of important technological innovations which have come from large companies, but so what? You still have corporations with large amounts of disposable cash for R&D in a world without monopolies and intellectual property. The handful of innovations you can mention don't really have anything to do with monopoly or intellectual property, they just happen to have come from big companies - <USER3> there's really no evidence that those companies would simply collapse by being slightly more cooperative.

The majority of important software innovations have come from the open bazaar, not the cathedral. The Internet; The Web; Firefox, WebKit; GNU/Linux, Unix; HTTP; SSH, SSL, AES; Python, Ruby, C, C++. Thousands of humble open source projects which have been distributed to and changed by millions of users.

And even when large corporations do spawn projects, those that succeed are those that encouraged at least some degree of openness. Android from Google, Java from Sun. Open standards for computer hardware architectures and software have lasted and stood the test of time.

Open code, projects, and standards have more than stood the test of time. We are actually living in a time of unprecedented open source success. The majority of computing systems run on significantly open source code. Millions of Android phones running Linux. Every serious server on the planet running on Apache or NGINX on Linux or BSD. A landslide percentage of users accessing them using Webkit, Blink, and Firefox. That's just the tip of the iceberg! Millions of lines of code are being updated publicly, in real time, by thousands of people across the world in collaboration. More so than ever before!

Sure, maybe _some people_ are a bunch of VC-backed business-savy Steve Jobs- worshipping iPhone mobile app developers now, but it's still sad to see someone say that tech innovation "happens in periods of monopoly" on _HackerNews_.

<comment><USER30> "majority of important software innovations have come from the open bazaar, not the cathedral. The Internet; The Web; Firefox, WebKit; GNU/Linux, Unix; HTTP; SSH, SSL, AES; Python, Ruby, C, C++."

The vast majority of those were not developed by an open bazaar, but rather by focused cathedral organizations: the early Internet, UNIX, C, C++, SSH, Firefox, SSL. The bazaar maintains them or cloned the success of others (SSH).

I also think you're vastly underestimating the influence and power over millions that continues to exist from closed commercial software: Apple iOS, IBM zOS, pOS, and DB2, SAP ERP, Oracle database, middleware, and various HR/SCM/CRM/ERP suites, Microsoft Office and Windows / IIS. The big difference is that there is an order of magnitude more revenue and more people being paid to work with commercial software than with open source.

That you claim all serious servers run Apache or Ngnix on *nix is profoundly ignorant of the millions of Windows servers and IIS servers out there, some of which power very large websites. I think Ngnix is a great server, but most of the large enterprises (banks, Telcos, etc) I've visted in my consulting run WebSphere or IIS and have never heard of HAproxy or Ngnix.

This is not to say this is a static state of affairs. Certainly in many cases the open source alternative is a better technology or better project, sometimes even the better product. Just there's a big difference between an innovative PRODUCT and an innovative PROJECT. There are lots of the latter on Github, but other than saving people some money, they're not having anywhere the economic impact a PRODUCT has.

There is scant evidence that open source leads to more innovative products. There's a lot of evidence it helps to lower the acquisition costs of supporting software for what usually wind up as partly proprietary products. All of the latest software kings: Facebook, Twitter, Amazon, Apple, Salesforce, Google - their primary money making innovations are closed source built on (mostly non GPL) open source . Their contributions of open componentry back to the community is welcome but limited.

The only large and "purely" open company is Red Hat, and even they go through major hoops to make it inconvenient for others (eg. oracle) to use their open source code for their own purposes (ie. Offer a RHEL clone and loss lead on support). They remain innovative. But so is SAP. So is Oracle.

<comment><USER31> > but most of the large enterprises (banks, Telcos, etc) I've visted in my > consulting run WebSphere or IIS and have never heard of HAproxy or Ngnix.

WebSphere is an app server rather than a straight http server. The equivalent to Apache/Nginx from IBM would be IBM HTTP Server, which is an extension of Apache.

<comment><USER30> I didn't want to really get into the distinction (Apache is an app server too if you consider mod_*). Yes, IHS is common and they will often use that.

As part of my broader point, IHS is a product, one of many Apache-based products. They're not using the open source project code directly. Even if IBM's "innovations" are modest, they're using it because IHS and the WAS plugin work best with WebSphere. I've managed to convince some to avoid this combo in favour of a simple HAproxy, but it's hard.

</comment></comment></comment></comment></comment><comment><USER32> The author makes some big statements about what Elon is doing and then wonders why everyone isn't guzzling the kool-aid like the author. It has nothing to do with the prisoners dilemma.

First, there is a large portion of the population that doesn't believe global warming is an issue.

Second, there is another large population that doesn't believe global warming can be stopped by a slow transition to electric cars.

Third, there is a large majority of the population that can't afford a 90k luxury car so they fail to see how Tesla will revolutionize the world. This is compacted by the fact that the batteries will need to be replaced in 6-10 years and it will likely cost 20k+. These cars are out of reach for the majority of Americans it's not really going to reduce CO2 output by anything significant enough in time to matter.

Fourth, Elon made a fat stack of cash selling PayPal to Ebay. With that being his primary historical success story, it doesn't make it sound like he is doing just what is optimal for humanity. SpaceX is great for space exploration, but that's not really optimal for humanity considering our current problems.

The article had a nice write up on pareto optimal solutions and the prisoner's dilemma but they are completely irrelevant to the skepticism observed here.

<comment><USER33> You've alluded to "things which are optimal for humanity" and "our current problems". Could you elaborate?

What do you think is optimal for humanity?

Which current problems are more significant than planetary-level challenges like global warming and confinement of our specifies to a single planet?

These put the existence of our civilization at risk. I would really _love_ to hear which other problems are more significant than those.

<comment><USER32> Cut the melodrama. Your post reeks of first-world privilege.

Confinement of our species to a single planet is much lower priority than the suffering caused by violent governments, starvation, diseases, and drug problems. Colonizing another planet might be optimal for spreading of our species, but it does little to reduce the suffering here.

Global warming is a problem. However, making luxury electric cars is a drop in the bucket compared to convincing China and India to crack down on things like unfiltered coal power plants.

<comment><USER33> It'd be great if we could first make everyone on this planet happy and then move on to the next one, but it's just not going to work that way. Long tail of human unhappiness will be very hard to eliminate.

Your mix of problems is highly heterogeneous. Starvation and diseases are serious challenges we have in fact been making a lot of progress on. However, they pose more limited and localized danger than global warming or planetary confinement and so must be given a lower priority.

Violent governments and drug problems are political and so out of scope. Gating space exploration on all politician playing nice and all people staying clean and sober is the best way to doom the project.

Making electric, environment friendly cars be perceived as luxury and something one can aspire to is a small step in the right direction. Also, they're luxury because the technology is expensive. Cells phone began as luxury product, too. Eventually, they'll become mainstream.

<comment><USER32> Violence and starvation are not a 'long tail' of human happiness. The market that can afford Teslas is much further down the tail than people subject to these problems.

</comment></comment></comment></comment></comment><comment><USER34>
      I believe the current skepticism around Silicon Valley's
      "Make The World a Better Place" mentality is deeply rooted
      in historical anxiety about institutional capitalism.

OT rant here: I don't think this is related to Tesla opening up at all. "We make the World a Better Place" is self-important bullshit in 99.9% of cases. The most likely outcome is that what you are doing has no measurable impact on the "goodness" of the world. In most cases, what you are doing matters only to a tiny fraction of the world's population. "Making the World a Better Place" is simply self-important hyperbole to the extreme.

<comment><USER34> Addendum: The fact that your fancy new app is only for a tiny fraction of the world's population is totally fine. Most products are like that. Just don't pretend it's anything more than it is.

</comment></comment><comment><USER35> _The only hope is cultural change._

The only hope is cultural _trust_ , and the only way to achieve that is to allow like-minded individuals to separate themselves into autonomous political units.

This is dangerous thinking Chris, if you start following these thoughts through to the end, rather than spinning off into happy-clappy "change the world's heart" wishing...

<comment><USER36> Or you could just learn to live with people who aren't exactly like you. You know, like everyone on the planet except for wealthy and reactionary enclaves of the United States.

<comment><USER35> Everyone?

[http://www.thoughtleader.co.za/oneyoungworld/2014/06/05/sout...](http://www.thoughtleader.co.za/oneyoungworld/2014/06/05/south- africas-rape-crisis-2/)

</comment></comment></comment><comment><USER37> You are being melodramatic. There is no anti-Tesla sentiment, at least here on HN. People were simply asking why didn't Tesla release the patents under an irrevocable, royalty-free defensive patent license instead of just blogging about it, which is a perfectly legitimate concern.

Also optimism has never been as high as it is now with all this talk about full automation of the economy and people living happily ever after with their guaranteed basic income.

</comment><comment><USER38> If Tesla did this in the early game, would they still be in the position they are today? I think this open source movement works but only if you have the next thing in hand or after you've taken your fill and are ready to move on. In Tesla's case, I think both are true.

If a hunter goes out, learns out how to kill an animal, and then teaches everyone else in the tribe how to do the same, he is shooting himself in the foot because he is no longer useful. The tribe can get their own food and his specialization is no longer special. So he dies off. Unless, he's ready to retire the hunting business and/or holds the monopoly for creating the weapons.

In Musk's case, he seems more interested in what SpaceX is doing and just built the largest electric car battery factory.

It's amazingly philanthropic and evil genius at the same fucking time!

<comment><USER13> > If a hunter goes out, learns out how to kill an animal, and then teaches > everyone else in the tribe how to do the same, he is shooting himself in the > foot because he is no longer useful. The tribe can get their own food and > his specialization is no longer special. So he dies off. Unless, he's ready > to retire the hunting business and/or holds the monopoly for creating the > weapons.

This ignores competitive and first-mover advantages. Maybe he's the best hunter (because of experience or talent), or maybe no one else wants or is able to be a hunter (especially if it's dangerous or physically-demanding).

Essentially, you're arguing that the sole hunter should keep a strong grip on the hunting monopoly by keeping everyone ignorant. In practice, this never works out well.

</comment></comment><comment><USER39> "Of course, this applies way beyond Tesla. I believe the current skepticism around Silicon Valley's "Make The World a Better Place" mentality is deeply rooted in historical anxiety about institutional capitalism."

silicon valley really needs to get over itself. the only thing different about silicon valley and other companies is that silicon valley is to naive to realize they are just like every other company, no matter how much they doth protest.

companies dont set out to make the world a worse place for the most part, even hated companies like BP have good intentions. but if you want to be a publically traded company, and if you want to make money, you have to make profit.

i mentioned on HN before that its funny how Amazon is loved and Walmart is loathed. all the reasons why walmart is loathed Amazon has in spades.

i also feel your view on how capitalism works in the western world. in fact, it has always been a prisoners dilemma / golden rule do onto others as you would have them do onto you economy. thats actually a reason why capitalism has worked so well for the west, and one of the reasons why it took longer in places like China.

</comment><comment><USER40> _The thing about capitalism, and our dismal history with capitalism-at-large, the "assume the other party is a shitbag" idea is so fundamentally ingrained in our cultural_

What's that got to do with Capitalism? Correct me if I'm making a straw man, but the alternative to capitalism is to remove negotiation from individual interactions by implementing more State-heavy mechanisms like Communism. Isn't creating a crap-ton of government bureaucracy, rules and regulations to tell people exactly how to live and interact with each other institutionalizing the idea that people are shitbags and shouldn't be allowed the freedom to behave freely?

I liked your original HN post and tend to be similarly disappointed in the lack of giving some people like Musk his due for trying to do the right thing... not to mention the nit-picking posts that assume that Musk and his people are too mentally deficient to properly allow use of their patents.

<comment><USER41> Honestly, what does regulation have to do with capitalism - where did this meme start and how can I kill it? Capital markets are a tool for allocating resources. They're pretty good at it in that they tend to work better than e.g. palace economies and mostly everything else humans have tried. But there is _absolutely nothing_ to the way that capital markets work that suggests regulation somehow breaks it or whatever other brain-damaged Koch-inspired bullshit they're selling on Fox News nowadays.

It's like looking at a hammer lying on a table, stating 'that is for pounding nails', then leaving the room and expecting the hammer to pound nails for you.

<comment><USER42> There are known problems of markets in the form of externalized costs. Global warming might be the greatest example of capitalism and markets being the worst thing humanity has every done in distributing resources....

<comment><USER40> How so? India and China are huge societies and have historically been much less capitalistic yet have been horrible polluters. More recently as they've embraced capitalism, their increase in pollution has more to do with their standards of living than with capitalism specifically. Yeah, they're polluting more, but then again they have a significantly reduced amount of starvation.

If anything, capitalism tends to spur the types of innovation that seems most likely to innovate us out of the possible problems of global warming.

</comment></comment></comment></comment><comment><USER43> One of the inherent assumptions of neo-classical economics is that we're all selfish, rational, utility maximizing, humans. That's built into our understanding of markets and how they function.

Now I understand where the author is coming from, and I agree there is a terrible lack of trust in modern America. I just don't agree that the cynical view, that all humans are untrustworthy shit-bags, is all that terrible. Cyncism causes parties to make explicit their assumptions about future behavior. We can then codify this assumed behavior in contracts.

If I was a battery manufacturer and I wanted to use Tesla's patents, I would approach Tesla and ask for a contractual agreement whereby Tesla agreed not to use those patents against me. If Tesla were unwilling to enter into this sort of contractual agreement with me, I would assume they were reserving the right to later use these patents against me.

</comment><comment><USER44> Just having the right culture is not a solution. You can have a culture that routinely goes for Pareto optimality. If that's not an evolutionary stable strategy, the moment you introduce agents that choose the Nash equilibrium instead, they would start winning and gaining ground.

I wonder about a different solution though: can you design a mechanism that transforms the Nash equilibrium of a Prisoner's dilemma game into the Pareto optimal outcome? Something similar to escrow?

[1] [http://en.wikipedia.org/wiki/Evolutionarily_stable_strategy](http://en.wikipedia.org/wiki/Evolutionarily_stable_strategy)

</comment><comment><USER45> Elon Musk's response: [https://twitter.com/elonmusk/status/477223079421046785](https://twitter.com/elonmusk/status/477223079421046785)

"Apparently, lots of confused media inquiries about blog title. Look, we just to make sure they don't set us up the bomb."

<comment><USER46> It's "up us" dammit.

</comment></comment><comment><USER47> Comment to claim in that large scale democracy automatically becomes more partisan.

In large scale democracy partisanship is not necessity. American system has some specific methods to cause it, compared to Finland where it isn't really a problem. And its really these TWO issues that make the american politics more partisan than rest of the world.

A) Election system is strongly geared towards creating two party. When new party has gained enough support it replaces one of the previous two parties at the control, and there is new TWO parties which compete each other. Compare that to systems in which allows smaller parties to get seats. For examble in Finland there are 3-4 big parties that total 60-70% of seats and rest goes to smaller parties. That means to pass anything you pretty much have to have two big parties agreeing on the matter and either third big agreeing or some small parties agreeing.

B) Executive branch is Winner takes all. In Finland the parliament(legislative branch) selects Executive branch and because no party has half or near half seats there is need to be enough parties agreeing on the matter. So if you are REALLY uncompromising you NEVER get to be part of executive branch EVEN if you become the biggest party of elections, since you didn't get more than half the seats anyway in multiparty system. The biggest party gets first attempt to create the cabinet, but they still need to get enough others onboard. The cabinet pretty much needs majority of legislative branch to support it. They need a program which over half the legislative branch supports and usually give seats in the cabinet to enough other parties that have over 50% of parliament. If biggest party fails to create agreement of the program the responsibility of trying to form the cabinet goes to next largest party. And if all else fails parliament may agree a minority government OR even putting some professional bureaucrats instead of politicians in top positions of executive branch. Both are extremely rare situations in here.

</comment><comment><USER48> Anti-Tesla sentiment certainly wouldn't have anything to do with Tesla's defrauding taxpayers, would it? [http://doubtingisthinking.blogspot.com.es/2013/10/tesla- carb...](http://doubtingisthinking.blogspot.com.es/2013/10/tesla-carbon- credits-ongoing-scandal.html)

</comment><comment><USER49> This article expresses perfectly why:

a) I'm very cautious about working with American companies b) Why my contractors nearly all bitch about working with American companies (I use a lot of contractors on oDesk and they tell me the same thing).

America's great but the lack of trust in business is the one thing that really grates on me.

<comment><USER43> As someone who has done lots of work for both EU and US companies I agree. The amount of times American companies just say "trust us" versus EU companies definitely grates on me. The US is not all terrible, but there is tons of work force exploitation going on in the US. Especially in the bay area.

</comment></comment><comment><USER50> > under the assumption the other player is a selfish dickhead. In a capitalist > environment like America's, with no social controls or other factors besides > ruthless logic, this is the default behavior.

Sigh. One of the most prominent features of capitalism is that it relies on _mutually beneficial_ exchanges.

<comment><USER51> Ideal capitalism. Much of modern capitalism is about getting the person on the other side of the table into a desperate enough situation, that they have to take your 'mutually beneficial' offer. I present as Exhibit A Greenspan's speeches on lowering worker mobility during his tenure.

</comment></comment><comment><USER52> Reputation should solve this problem given that life is a repeated game as long as we also are able to be long-sighted. A more formal argument can be found here: [http://economics.mit.edu/files/4754](http://economics.mit.edu/files/4754)

That suggests the cultural problem is decline in longer-term thinking or more likely a decline in arbitrary codes of behavior without a concomitant increase in longer-term thinking that would recreate many of those same norms.

American business used to place a high value on trust: "A man I do not trust could not get money from me on all the bonds in Christendom. I think that is the fundamental basis of business." -J. Pierpont Morgan

As another example, Warren Buffet seldom does diligence to determine an offer; he trusts those from who he buys to deal and report honestly.

</comment><comment><USER53> Any company would be stupid to develop car manufacturing based on another company's held patents. But just ask your lawyer to talk to Tesla's lawyers to buy a very cheap, almost free license. Then we'll see if they're serious about this or not.

<comment><USER54> Obviously you would do more than just trust a web page as a licence to the patents, but I imagine it would be hard for Tesla to win an infringement case after publishing this. This is no "Sun CEO blogs congratulating Google on android" level of plausible ambiguity.

</comment></comment><comment><USER55> Interesting article, but the font is very difficult to read. I had to change it using the Web Inspector before I could finish reading.

</comment><comment><USER56> I think he's making a grave error to attribute mistrust to capitalism; in any other system dishonesty is also possible.

</comment><comment><USER57> There is a body of literature on the subject how self governing groups escape the tragedy of the commons. For example: [http://www.amazon.com/Governing- Commons-Evolution-Institutio...](http://www.amazon.com/Governing-Commons- Evolution-Institutions-Collective/dp/0521405998)

This is all empirical studies.

</comment><comment><USER58> In the prisoners dilemna, you know the outcomes - mostly because the game has a short life span. In life, you don't know the outcomes since the game has no end. So you _never_ know if you've ultimately chosen the right solution. It's all about your own moral at some point.

</comment><comment><USER59> Got to love this.

I'm reading the comments on the earlier thread and thinking 'shit, people are really negative'. I refresh the page and this thing shows up. Nice to see that at least on HN people possess Second Thoughts or would this be Thirds Thoughts?

</comment><comment><USER60> > The Prisoner's Dilemma demonstrates that a Nash equilibrium solution is not > always Pareto optimal. The "confess-confess" solution is the Nash > equilibrium. You will always be better off screwing the other person over, > whether they are honest or dishonest. The "deny-deny" solution is Pareto > optimal. If both parties can somehow trust each other, they will both be > better off selecting this solution.

This part is very confusing to me. I've always understood that deny was the screw-over move in the prisoner's dilemma. But this segment suggests that confessing is a local optimum. Have I misunderstood the prisoner's dilemma all these years?

<comment><USER61> >> deny was the screw-over move in the prisoner's dilemma. But this segment suggests that confessing is a local optimum.

The competition is between you and the other prisoner, not vs the state. Confessing screws over the other prisoner.

</comment></comment><comment><USER62> Isn't the ultimate socially-optimal answer for the "guess 2/3rds of the average" game be to convince everyone to answer 0? Because 2/3rds of 0 is 0, so everyone wins.

</comment><comment><USER63> Really great post. There's another angle here that has implications around the notion that the Nash Equilibrium is the norm: Path dependence. Getting out of this mess may be less possible because of that notion because how we can proceed is path dependent upon all of us thinking that, underneath it all, Musk is also a shitbag.

We've got a lot of problems facing humankind right now. The stakes get higher every day. Whatever it is we have to do to solve the toughest one we need to do _whatever it takes._

</comment><comment><USER64> So first off I also want to say I found this a great read -- I studied poly- sci and business and work in the tech scene, and when they all collide it gets _really_ interesting.

This raised a lot questions for me though. I was trying to draw the payoff matrix for adopting Tesla technology. How would this look? How to estimate relative gains for each player? I was hoping he'd go through it a-la Khan Academy.

</comment><comment><USER65> It's a lack of leadership, and it's endemic to society. The Prisoner's Dilemma highlights this. Trust on both sides isn't the only Pareto optimal solution. A leader dictates the correct outcome and does not require trusting a subordinate's decision. If both sides were leaders, they would reach the optimal outcome.

Elon Musk is one of the few leaders in the world.

</comment><comment><USER66> Thanks Chris - a superb article, deeply meaningful.

</comment><comment><USER67> Testa try new battery design now: CarbonBattery The Ryden dual carbon battery developed by Power Japan Plus is balancing the energy storage equation of performance, cost, reliability and safety. [http://powerjapanplus.com/](http://powerjapanplus.com/)

</comment><comment><USER68> Individuals and corporations are not rational machines. Things are much more complex then an equation.

</comment><comment><USER69> Great article. Very well articulated.

If you haven't seen it already, there's a BBC series called "The Trap" which raises interesting questions too around game theory reflecting human behaviour versus game theory driving human behaviour through modern capitalism.

</comment><comment><USER70> "I believe the current skepticism around Silicon Valley's "Make The World a Better Place" mentality is deeply rooted in historical anxiety about institutional capitalism."

I am sorry, but that statement shows misunderstanding the issue at such level it is hard for me take his argument as something based on facts.

No. The skepticism around Silicon Valley has always been because of its coziness with the gub'mint. From internet to Siri, DARPA funds large parts of our research. And when this research reaches the public via SV, it automatically divides people into two groups - those who can use it and those who have been replaced. The group which can trump this research, though, keeps disappearing.

It doesn't, by definition, follow the principals of capitalism. That institution in 'institutional capitalism' is the government and it cannot be whitewashed over.

</comment><comment><USER71> While a Homo economicus plays the Prisoner's Dilemma, a Homo sapien plays Calvinball.

</comment><comment><USER72> really like this article... but your font (or font weight) hurts my eyes :(

<comment><USER73> Same here, I had to disable the font-family css command in order to read it.

</comment></comment><comment><USER74> I'm just generally skeptical of Musk. He is great at putting out blog posts that people don't treat like the press releases they are.

</comment><comment><USER75> I'm willing to overlook that horrible font because I learned what a "Keynesian Beauty Contest" is. Excellent article.

</comment><comment><USER76> I wonder if a foundation of multiculturalism is why America's business culture is so distrusting.

</comment><comment><USER77> Relies too heavily on Prisoners Dilemma, should read Governing the Commons by Elinor Ostrom

</comment><comment><USER38> So much win in this! Let's move together towards Musk's Pareto Optimal solution!

</comment><comment><USER78> > between 1 and 100

I think this should be between 0 and 100 (for the Nash equilibrium to work, anyway.)

</comment><comment><USER79> making anti-tesla looks like supporting everything that is wrong with establishment and patent system is exactly the kind of connection he wants people to make. Just another PR gimmick there.

</comment><comment><USER80> So if we could all just trust Elon Musk and never question anything about him or his companies we could save the environment, and capitalism and our culture and all of humanity?

OK then.

</comment><comment><USER81> Great piece.

</comment><comment><USER82> <place holder for skeptical comment>

</comment><comment><USER83> David: What is the primary goal? Joshua/WOPR: You should know, Professor. You programmed me. David: Oh, c'mon. What is the primary goal? Joshua/WOPR: To win the game.</comment>


Lessons learnt whilst writing a development environment for iOS - <AUTHOR> http://slidetocode.com/2012/07/14/lessons/

<comment><USER2> Thanks for sharing your experience. I'm just starting development on a text editor (for written word, not code) and found your post useful.</comment>