Companies controlled by PE firms use bankruptcy to shed pension obligations - <AUTHOR> https://www.washingtonpost.com/business/economy/as-a-grocery-chain-is-dismantled-investors-recover-their-money-worker-pensions-are-short-millions/2018/12/28/ea22e398-0a0e-11e9-85b6-41c0fe0c5b8f_story.html <comment><USER2> I worked at Marsh from 2005-2015 in both corporate and the store. We were always skeptical of Sun, the CEOs that would cycle through didn't grasp the basics of grocery, and as an organization we failed to invest in basic infrastructure that would reduce our overall costs which are huge in the 2% margin grocery business.

At the store we had registers with an OS from the 80's, a common thing if you look around, but we never invested in developing anything beyond the 80's unlike our competitors. We didn't ever implement a JIT style logistics program, which with massive in store staff cuts led to poor merchandise orders which in a perishable business kills you. Management in general was _highly_ skeptical of new technology and prone to spending a bunch of labor hours on repetitive, easily automated tasks (by my accounting at the time, I could have automated more than a million dollars of labor costs with a week of effort - something I brought up with management and demonstrated but was ultimately shot down, I wasn't some super genius - we had folks literally copying and pasting for 8 hours a day).

Marsh was a good company with good people, several of those in the article I knew from my time in corporate. We had folks that would kill themselves working 60 hour weeks to keep a store afloat. It sucks to see what had happened to them.

<comment><USER3> I wonder how much of that was politicking, where someone was keeping something purposefully bad so that they could sell a solution that "saves so much money" when a far cheaper solution would save as much money and cost way less.

<comment><USER4> Sometimes companies maintain high friction/high cost crap like that to scare off acquisition.

A friend worked for a regional bank that had a strategy of purposeful obsolescence to maintain control with the core shareholders, who were mostly from one family. They were using 1980s era AS/400 systems with terminals as late as 2008, and had only 1 PC assigned to a manager in the branches, with connectivity via ISDN.

<comment><USER2> I hadn't thought of this to be honest, but I do faintly remember the IT / Dev team using the "not technically feasible" line a bunch whenever Marketing would come through with stuff. Used to get me angry quite a bit and I saw it translate a bunch to lost revenue and increased costs.

I don't know how much of this got sent out of Marsh and up to Sun though.

<comment><USER4> Lazy IT people are always a good excuse too. Especially in CFO driven IT shops.

I've seen people waste millions on magical systems that did very little out of inertia. In one case, a system with something $10M in annual costs that managed terminal (as in VT-102 terminal) and line printer assignments. A decade after the printers were trashed and terminals moved to a (almost equally offensive) very expensive web-based system.

</comment></comment></comment></comment></comment><comment><USER5> _When Sun bought Marsh Supermarkets, the company had three retirement plans. One for the top five Marsh executives, one for the store employees, and one for the warehouse workers.

Only the executives' plan, however, was fully funded under the sales agreement: With the completion of Sun's purchase, Marsh's top five executives were to be awarded $14 million in retirement payments, according to company financial documents. Among them: CEO Don Marsh at $7 million and corporate counsel P. Lawrence Butt at $2.2 million.

Meanwhile, the other two retirement plans — the worker pensions — were short millions of dollars._

</comment><comment><USER6> Pensions get abused because they can be. (I'll limit this to public pensions)

When a municipality issues a bond, that bond has an indenture which is a contract. It has a very specific set of rules about what the municipality can and cannot do (covenants) and a very specific schedule for when and how the money must be paid back. Try skipping an interest payment and all the sudden you instantly find that there are _serious_ consequences, like you find yourself in court, or threatened with involuntary bankruptcy, and your credit rating goes down, etc.

When a person obtains a mortgage, they too sign a contract specifying things they must do (eg get insurance) and a schedule for repaying principal and interest. Try skipping a month or two of payments and the bank starts calling, it affects your credit, and maybe you lose your house one day if you keep not paying.

But pensions have nothing like this...it's almost the reverse set of incentives. There's virtually no enforcement of prudent management. The Chicago teacher's pension fund skipped making contributions for a _decade_ in what they euphemistically called "pension holidays". Instead, the money got diverted mostly to higher salaries. The people who ran the city were actually rewarded for this malfeasance. And that's in addition to routinely underestimating critically important assumptions such as healthcare costs, lifespan, investment returns, and interest rates, which are hard enough as it is. The problems take multiple election cycles to manifest, and it creates a massive moral hazard. You couldn't design a more toxic form of IOU if you tried...I've long argued that public pensions should be illegal.

</comment><comment><USER7> To me the bigger culprit is the unfunded pension as a tool of retirement planning. Unfunded pensions are failing or on the brink of failing almost everywhere they are tried. It's a huge scandal and deeply immoral IMO. I read the other day that NYC alone has over $100bn in unfunded pension liabilities. There is simply no budget to pay that down. Unfunded pensions taking down numerous economies in Europe.

There is a county in Georgia (Sandy Springs) that effectively went private. Rather than offering a state pension to their employees (other than ones they were legally required to), they calculated the value of the pension contribution they would make and simply tacked it on to employee salaries. I personally think this is a good approach (with some room for incentives that help protect people from themselves).

Note: not trying to mount a defense of PE - often people ask what is the purpose/role or value of PE in society. In a somewhat perverted sense, this is it. There are not many mechanisms that can almost instantly re-habilitate an enterprise that was mismanaged or made severely consequential long term false promises to employees. The alternative is a slow, timely and painful decline similar to Sears or Kmart and rather than this article we'd be reading articles about the towns that Marsh left behind.

<comment><USER8> Why isn't it a solution to simply require pension funds to be fully funded, perhaps under a separate legal entity that's protected from raiding by PE firms?

Why is it that the "unfunded pension" crisis always makes people question the second term in the phrase instead of the first?

<comment><USER9> Why? I can think of multiple reasons.

Some essentially boil down to human nature - short-term thinking, preferring politicians who make rosier promises ("assume high rate of return on pension investments and lower the taxes") against honest politicians ("increase taxes since current levels are unfunded"), etc

Some are about societal changes no one can honestly predict - avg lifespans increasing (avg life expectancy in the US was 61 when social security was enacted), pensions were promised in 70's / 80's before globalization wave hit forcing Western companies to either die or compete with leaner overseas firms, internet and e-commerce bringing b&m retail apocalypse, etc.

To find out true cost of funding a pension, try buying an annuity for the similar level of monetary coverage where seller has to do more due diligence. And that will show you the true cost, and my guess is that there is very little appetite to bear that cost in our society.

<comment><USER10> I imagine it's a lot like any other cash flow issue. It's in no ones best interest to halt the company the instant it can't meet its obligations by $1. You get a loan instead. But when do you halt the company?

<comment><USER9> Why not go the free-ish market route (with politically acceptable regulations like creditor protections) and let the owners decide how/when to halt the company?

<comment><USER10> The answer seems to be never halt the company in most cases, just split it up and write off parts. When did yahoo end?

</comment></comment></comment></comment></comment></comment><comment><USER11> Defined benefit pension plans create a huge moral hazard and are just too risky for employees, employers, and taxpayers alike. As a society we should be aggressively phasing out pensions and replacing them with defined contribution plans like 401(k) and 403(b). That way each employee's retirement funds are in an individual named account held by a brokerage and can't be taken away. Even if your employer goes bankrupt, everything already deposited in your account is still yours.

<comment><USER12> No.

The real risk is not in the present, the real risk is outliving your retirement savings.

You can predict how long a population will live, you cannot predict whether a single person will need 5 or 40 years of retirement savings. Collective defined benefit plans mitigate this risk and are the only thing that really make sense.

They also end up cheaper because instead of each person needing to save the amount needed until the end of retirement, the group only needs to save the amount that the average person will need.

<comment><USER13> In the UK you can buy an annuity with the proceeds of your pension fund at retirement. Is the same not true of a 401(k) in the US?

<comment><USER14> There's always a risk an annuity provider will go bust.

<comment><USER15> There's also a risk of a meteor hitting the earth. The likelihood is very low.

</comment></comment></comment></comment></comment><comment><USER16> Still amazing to me that owners and equity firms get money before pension funds. The literal theft - a pension is part of your income, and being able to sell off a company without paying off pension debts literally means retroactively stealing wages from workers.

Remember that banks, etc all have insurance on their debt, apparently that doesn't matter - companies are simply stealing from money that is not theirs, and that's apparently ok.

<comment><USER17> The government does the same thing with SS. If you pass away before collecting benefits, those benefits aren't passed on to those who inherit your estate.

<comment><USER18> That's not wage theft though. You can't be paid after you're dead. Inheritance is just legalized aristocracy.

<comment><USER19> So you are supposed to just give your estate to the government? Fuck that.

<comment><USER18> Why not? Then the wealth can be distributed to everyone fairly. Having this safety net available for everyone and not just the rich would reduce the need for wealth hoarding in the first place. Your ideology has no justification besides your own particular interest in the class position of your offspring.

<comment><USER20> Because I want my children to benefit and build on my life's efforts.

<comment><USER18> And I don't want you to be able to do that. If this is supposed to be a rational position you're going to need more justification than "you want it".

<comment><USER17> That's a truly horrendous position you've taken. You're arguing that it is somehow rational to not want a child to benefit from his or her caretakers. The only logical conclusion from this is why stop at death? Why don't we make it so it's illegal for a parent to take any action that provides any sort of benefit for their children, and all children are dependent upon the state from birth, with all adults paying a mandatory 'childcare' tax. This way all children can start out life on 100% equal footing, and also without any opportunity to experience what a parent's love and sacrifice really is. What a dystopian future you desire.

<comment><USER18> Actually, we live in quite a dystopian reality. Your only argument is a slippery slope fallacy. I never said that a child should not benefit from their caretakers. Only that they should not inherit economic wealth which they did not produce.

<comment><USER17> So explain what's the tangible difference between receiving benefits while the parent is alive and after they're dead? Either way the child is inheriting economic wealth they didn't produce, which shines a light on the horrendousness of your argument.

<comment><USER18> Instead of calling my argument horrendous with no justification, maybe you could try engaging with it. I, too, would like to just call you a right-wing libertarian nutjob or something like that and move on with life, but hopefully something better can happen. :)

> Either way the child is inheriting economic wealth they didn't produce

There isn't a whole lot. But you're missing the point of parenting. Hint: it's not financial support. You can't write a baby a check for $1M, plop it down in an empty house and expect it to live a good life. After you die you're not doing any of the stuff that actually makes having a parent valuable to a child relative to receiving the necessary financial support (which will not even be available to working class children under your proposed system).

Maybe if you were confident your children would be adequately taken care of if you died, you wouldn't have to work so hard saving up a nest egg and would actually have more time to be a parent.

</comment></comment></comment></comment></comment></comment></comment></comment></comment></comment></comment><comment><USER21> Sometimes I look back and wonder if this last 30+ years of PE firms consolidating and eating up all of these mid sized companies is actually the reason things haved trended towards very large corporations. As opposed to economies of scale etc. A large market cap is probably the best defense a company has against being bought out. It's almost like being a giant whale in the ocean as opposed to a fish.

</comment><comment><USER22> As a natural person, our interest payments are NOT tax deductible.

Corporations get to deduct interest costs from their taxes. So PE firms are incentivized to load up the firms they attack with debt.

Additionally, PE firms are allowed to use a firm's own money as collateral for the loan used to take over the firm. This includes the pension funds.

So any public firm responsibly run is subject to attack. Its almost irresponsible for a firm to fund the pension fund as it will be used against the firm.

The solution:

1\. Require that any loan be based on the assets currently controlled by the PE firm.

2\. Eliminate tax deduction for debts that are not directly tied to capital purchases.

<comment><USER23> Or just let the market move away from pensions entirely, like any sane, moral person would choose.

</comment></comment><comment><USER24> Just another illustration that the "America" you learned about is not the America™ we live in. As a parent I find it more and more difficult to try to teach my kids the reality of America without sounding like a conspiracy theory nut job. I do not want my kids growing up with blindly trusting that any institution (schools, corporations, government, etc.) have their best interests in mind. In a way I feel like selling them the "dream" is much less painful but I would feel like I failed as a parent to not warn my kids of the realities of the world.

<comment><USER25> The two most depressing books I have read recently are A People's History of the United States and Lies My Teacher Told Me and I wish I had read them when I was a child but YMMV.

<comment><USER13> Hopefully the fourth paragraph of the Wikipedia article will help you feel less depressed, since

"A People's History of the United States has been criticized heavily by historians from across the political spectrum. Critics assert blatant omissions of important historical episodes, uncritical reliance on biased sources, and systematic failures to examine opposing views."

[https://en.wikipedia.org/wiki/A_People%27s_History_of_the_Un...](https://en.wikipedia.org/wiki/A_People%27s_History_of_the_United_States)

<comment><USER25> There is a late chapter where the author has a full throated call for what sounds like community socialism as practiced by Jesus and in my opinion the book is worse for it but the excerpts from the interviews he did in the latest editions and separate book make up for it, also I appreciated the alternative sides that were fighting on all sorts of political issues that lost even if they are seen as biased because the it's natural for either side in a conflict - it's interesting because I'm old enough to have been taught the Columbus and Pilgrams as beneficient travelers tale even up to high school, and the native American experience/side is pretty inadequately covered by most all media.

</comment></comment></comment></comment><comment><USER26> Companies should never be responsible for managing the retirement savings of their employees. I can't imagine that this every made any sense, but it's an idea that comes from an era when there were a lot of big stable companies that people believed would be profitable for an entire lifetime. We've now seen ample evidence that such companies are really unusual.

</comment><comment><USER27> Its a shame that pensioneers are so low on the bankruptcy list.

The banks of America's and Lehman bros get their money before the people who are working the business to survive do.

Without basic income you need a job to survive but at the same time you're being exploited while you work that job.

<comment><USER28> In Canada, pensions are close to the top of who gets paid out in bankruptcy. Doesn't help a lot, they just sell off all the pieces and pay off insiders before entering bankruptcy.

</comment></comment><comment><USER29> This kind of thing is horribly common in declining firms - a last minute attempt to asset-strip everything of value and transfer it out of the corporate entity, which can then go bankrupt, stiffing creditors and employees.

See also Radio Shack, Toys R Us, Maplin, and British Home Stores: [https://www.theguardian.com/business/2017/feb/28/philip- gree...](https://www.theguardian.com/business/2017/feb/28/philip-green-agrees- pay-363m-bhs-pension-fund)

(The astonishing thing there is that somehow the thief was shamed into returning the money.)

<comment><USER30> Newspaper are an excellent example as well.

[https://www.bloomberg.com/opinion/articles/2018-03-26/alden-...](https://www.bloomberg.com/opinion/articles/2018-03-26/alden- global-capital-s-business-model-destroys-newspapers-for-little-gain)

</comment></comment><comment><USER31> Oliver Stone's Wall Street was not an instruction manual.

<comment><USER32> Neither was Liar's Poker, yet Michael Lewis has repeatedly commented that people saw it as something to aspire to. The same occurred with the glorified story of Jordan Belfort. Or Patrick Bateman (that one was of course fictional).

What is it about our society that makes people oblivious to satire/cautionary tales as long as it's given a shiny cosmetic sheen?

</comment></comment><comment><USER33> On some levels the government insuring pensions like this creates an economic incentive to do exactly what these guys are doing.

<comment><USER3> Government pensions aren't insured like this and also have widespread issues with leaders coming in an slashing contributions so that they can spend the money elsewhere; eg, Illinois on every level of government. The insurance at least protects the pensioners to some degree.

<comment><USER33> Reread the article and what I said. The government insures some private pensions, not public pensions. This insurance provides some economic incentive for PE firms and other managers to behave in the manner derided in the article. All I was stating.

</comment></comment></comment><comment> n-exploit How is there not a government institution established to investigate fraud such as this?

</comment><comment><USER34> That's why nobody shall rely on pension plan. Ya a scam. Just take the money and invest on your own terms.

<comment><USER25> Off the top of my head, what is the difference between these pensions and a.) public employee pensions like state/county/municipal employees or police/fireman pensions at full pay of last year of service b.) military retirement at half pay after 20 years of service? Those seem like a really good deal for the retiree ( that also look unsustainable in some areas for a.) at least)

<comment><USER34> I don't know exactly how it works in all areas to be honest. But if there's a pension deduction, and one is able to withhold it and invest on their own, I think it should be the default choice.

Military is a whole different story. They need to incentivize people somehow and it ain't going to be ping pong tables and beer fridge.

</comment></comment></comment><comment><USER35> There's a special place in hell for private equity firms. Go ahead & downvote me. You're not changing my opinion.</comment>


At 16, Ganesh got a job in Qatar. Two months later he was dead - <AUTHOR> http://www.theguardian.com/global-development/2013/sep/25/qatar-nepalese-workers-poverty-camps <comment><USER6> See my post in the other thread about living in Qatar.

The exit visa is a system that legally enables indentured servitude. Any country that has this system (pretty much just Islamic mideast countries) should be shunned by the US and the UN (won't happen of course given the US has a couple of bases in Qatar and BP has a huge investment there).

<comment><USER7> Given that the terms change from what the worker originally agreed to - <USER2> example, a lot of these work camps don't bother paying the workers, and freedom to roam is curtailed - it's more analagous to slavery than indentured servitude.

<comment><USER8> It is legalized slavery. These middle eastern countries are well known for that. That's why they are recruiting the poorest of the poor from rural areas in Asia.

Foreign workers have 0 rights there. But hey these guys are US allies,the leader of democracy and the free world... they cant be bad , can they ...

<comment><USER9> Not the middle eastern countries. This is part of their legal system, which is called "islam", or "sharia" (translation: the right way for a muslim).

Slavery (if you define it as forced labour without compensation), in case anyone doesn't know, is part of every religion. It is even part of Christianity, but Canon law specifies that it is a Christian's duty to, firstly, never own slaves themselves (with serious punishments for violations), secondly, to work to exterminate slavery around them (e.g. purchasing slaves then freeing them).

Little known fact, that second law is what lead to the introduction of hindu numerals in the west (Venetian merchants would purchase slaves, then free them after one voyage, in Venice. On of these joined a monastery, and taught the other monks (many things, mostly historical data, actually), on of whom wrote the Codex Vigilianus, which lead to the pope starting to use the numbers, which lead to ...)

Islam encourages freeing slaves, but only in one circumstance : after they have completed a successful military campaign, to celebrate (and it's perfectly OK, to re-capture the freed slaves and force them to fight again later. In fact the prophet did this). Note that islam is also unique in that it actually says that it's OK for owners to just kill slaves (whereas in other law systems there has to be a reason. Like, say you can kill slaves for running away. Islam and specifically the second Caliphate is the only state in history that has a documented history of killing slaves for fun).

So I'm wondering what the attitude is on this. If you seriously defend this point, you're effectively against every religion except Western-brand atheism (ie. not the -much more successful- socialist version of atheism), and Christianity.

Let me just leave you with a quote from Winston Churchill "A degraded sensualism deprives this life of its grace and refinement, the next of its dignity and sanctity. The fact that in Mohammedan law every woman must belong to some man as his absolute property, either as a child, a wife, or a concubine, must delay the final extinction of slavery until the faith of Islam has ceased to be a great power among men. " (Mohammedanism is the historical name for Islam)

And do not take this as dissing islam, in fact pretty much every religion has slavery (in the sense of zero-compensation forced labour). "The west" is unique in opposing slavery and is still the only driving force behind the extermination of slavery, half-heartedly sort-of kind-of joined by India (the difference is that the west actually imposes trade sanctions against slavery- using states for using slavery whereas India refuses to do that. Within India, they're doing a good job fighting slavery though).

As the article illustrates, the western fight against slavery has actually lost terrain in the last 2 decades. Mostly because islam-based law systems are pushing for re-introduction of slavery (in Saharan Africa, Sudan, Mali, the worst can be found. But it also happens in the Middle East and Asia). Today the situation is that Islam is regressing, and slavery is one of the consequences of that.

Frankly I hope that a few states experience a few slave revolts. If Saudi Arabia were to be destroyed by it's (large majority) of almost-slaves, for example, that would do a LOT to eliminate slavery. Of course, like Holland before it, America is mostly on the side of the slavers in the name of stability.

<comment><USER10> >>This is part of their legal system, which is called "islam", or "sharia"

This has nothing to do with Islam. This is all about money and a few rich idiots abusing their power.

Bulk of the practices you associate with any religion, are not that of a religion but that of the local civilization at that point of time.

Your post resembles the attitude of the western masses today, which is to hold the perception created by media and politicians as a fact. Islam is followed by more than 1/3rd of the world today, no one wakes up with knives searching for slaves to kill. These people are ordinary people just like any other people in the west who go out and make a living, in the hopes of a good life for themselves and their family.

And they have their local culture which dominates bulk of their lifestyle.

Secondly you quote Winston Churchill, This is heights of hypocrisy. The man has made extreme racial remarks. For eg from : [http://en.wikiquote.org/wiki/Winston_Churchill](http://en.wikiquote.org/wiki/Winston_Churchill)

>>I do not agree that the dog in a manger has the final right to the manger even though he may have lain there for a very long time. I do not admit that right. _I do not admit for instance, that a great wrong has been done to the Red Indians of America or the black people of Australia. I do not admit that a wrong has been done to these people by the fact that a stronger race, a higher-grade race, a more worldly wise race to put it that way, has come in and taken their place._

Basically he is saying, anything that what the so called self proclaimed 'stronger' or 'higher-grade' race does is right.

This is the exact same attitude these rich guys in Qatar show today. Something tells me they are both just the same. Regardless of the religion.

People like these should think about their own morals before talking about somebody else's.

<comment><USER9> I don't understand. What exactly are you saying is not true : 1) islam is a system of laws

2) those laws include slavery

3) people who are fighting to introduce those laws to society are reintroducing legal slavery

4) the muslim world is the major hotbet of slavery

Copious evidence for all claims is easy to come by. Start with : [http://en.wikipedia.org/wiki/Islamic_views_on_slavery](http://en.wikipedia.org/wiki/Islamic_views_on_slavery) And if you want to hear it from an imam: [http://www.islam- qa.com/en/94840](http://www.islam-qa.com/en/94840) (note that many of the "advantages" slaves had are the exact same as they had in the Roman Empire. An owner, for example, would generally treat his own educated slaves better than fellow free men)

If you want to be completely horrified by this site, just read the category [http://www.islam-qa.com/en/cat/362](http://www.islam-qa.com/en/cat/362)

Some examples, and the TLDR

"Islam and slavery" (TLDR: taking slaves is allowed "in war" and buying them and kidnapping them. There are lots of rules about slaves)

"Intercourse with female prisoners of war." (TLDR: allowed for men)

"What is the ruling on intimacy with slave women?" (TLDR: allowed for men)

"Intercourse with a slave woman is not regarded as zina (adultery)" (TLDR: true, provided certain conditions are met. Also: A muslim man fucking a non- muslim woman is perfectly OK if not done in an islamic country, because any muslim is at war with everyone outside of muslim countries) (note how he squirms to avoid saying what the ruling is on muslims living in non-muslim nations. Why ? Because that's punishable by death, except for soldiers and -maybe- ambassadors. Where do you live ?) ...

Your "evidence" that this is not true, is, as I read it :

a) 1/3rd of the world follows islam (in reality, it's probably between 1/5th and 1/6th)

b) "no-one wakes with knives searching for slaves to kill" (that's not allowed, btw, you have to buy them first)

c) Winston Churchill is a hypocrit with often similar socialist eugenic standpoints as the people he fought -> not a surprise to anyone who knows a smitten of history. Nobody denies he was a keen observer and a very effective leader either.

<comment><USER11> Islam isn't a system of laws, it's a religion. Like all organised religions, what's written in its holy books is of far less practical importance than what is preached by its leaders. Adherents don't read and figure out for themselves, they follow what they are told the books say. Like most religious leaders, the Islamic holy men tend to preach what is convenient to them. The fact that the religion is Islam isn't of particular note. It wasn't so long ago that American Christian leaders preached that God condoned slavery. You might explain this by talking about different branches of Christianity, and likewise there are different interpretations of Islam too. But really, I think that unless a religion actively encourages a practical pursuit of self- enlightenment (e.g. Buddhism, Taoism, spiritual Yoga), then it is nothing more than a system of control. Ultimately the important thing is how corrupt the leaders are.

Think of it this way, if there were no courts and no defence lawyers and no- one ever bothered to read the legal statutes for themselves, then would the actual text of the law mean anything? Or wouldn't it rather be that, in application, the law would tend serve the interests of the police?

<comment><USER12> Islam absolutely contains a set of laws. For the Muslim, you cannot have the religion without the law. Even in countries where Islam is the minority, disputes between Muslims are settled by a community Islamic court...

<comment><USER11> Please read again. I have not denied that Islam contains a set of laws. I said that Islam is not exactly equal to a set of laws. Which is correct.

I've also stated that, in practical terms, it is the behaviour and beliefs of the religious leaders that matter more that the laws themselves. The community Islamic courts you cite are a perfect example of this. You seem to expect them to behave according to some monolithic interpretation of Sharia law. Whereas, in reality, these courts are run by the Islamic community and are presided over by local religious leaders who make decisions (and interpret the laws) according to their own beliefs, informed by their own prejudices and self interests.

If you have any doubt that this is true, then simply consider that there are moderate Muslims in the world, and there are Muslims that believe God wants them to commit murder. Do you think it is a coincidence that those who see the West as the devil come from countries where the West has severely harmed in the past through selfish and corrupt interference? Do you think it is by chance that within the West and within countries allied with the West, we find more moderate viewpoints?

Religious rhetoric aligns itself with realpolitik. It is naive to see it in any other terms.

<comment><USER9> 1) many muslims disagree that there is a difference between islam and sharia. The word itself disagrees with your assessment. Besides, ever met a muslim that didn't care what halal was ? Ever wondered what "halal" refers to. These people that call themselves muslim use the sources I referred to as guidance on what is halal, they do _not_ decide for themselves.

2) slavery, incuding kidnapping people, even children into slavery is halal. So is raping them. Yes there's limits to exactly who, when and where, but frankly that doesn't matter to the morality of that. Halal = morally reprehensible.

3) Even seemingly stupid parts of the islamic faith, like halal food (practiced by the vast majority of muslims), you're going to find discriminatory/racist at best (religious discrimination in employment, to start with). Even that part is morally reprehensible.

4) I disagree strongly with your assessment that "those who see the West as the devil come from countries where the West has severely harmed in the past through selfish and corrupt interference". Aside from the fact that that statement reads like a conspiracy theory, those hotbeds you refer to are Saudi Arabia, Somalia and Pakistan. In a different way Egypt has been a hotbed. You _might_ be able to build a weak case America has harmed Somalia, but the others have massively benefited from America's influence and help.

I propose instead that those who see the west as the devil come from societies (or at least families) that take islam very seriously and let it guide their life. The stronger the place of islam in their lives, the more hate for everyone they have (not just for America, in case you truly are that naive. Israel, Holland (because there is a whore at every intersection, one Egyptian explained to me not very long ago), France (something about a Jewish school that you just can't repeat, and the "fact" that they support ex-muslims in Lebanon), Ethiopia, Kenia, ...).

> Religious rhetoric aligns itself with realpolitik. It is naive to see it in > any other terms.

 _Everything_ , including your rhetoric, aligns itself with realpolitik. That's the definition of realpolitik. Your statement is true, but it contains no information, other than what's in the dictionary. Barbie dolls align themselves with realpolitik too, and it is equally naive to see things otherwise.

<comment><USER13> [http://en.wikipedia.org/wiki/Bigotry](http://en.wikipedia.org/wiki/Bigotry)

You are a bigot.

<comment><USER14> I disagree. I think his comments are well-researched, insightful, and logically driven. That his conclusion does not jibe with your particular worldview does not make him a bigot.

</comment></comment></comment></comment></comment></comment></comment></comment></comment></comment></comment></comment><comment><USER15> From another article on the topic by The Guardian [1]

 _The British engineering company Halcrow, part of the CH2M Hill group, is a lead consultant on the Lusail project responsible for "infrastructure design and construction supervision". CH2M Hill was recently appointed the official programme management consultant to the supreme committee. It says it has a "zero tolerance policy for the use of forced labour and other human trafficking practices".

Halcrow said: "Our supervision role of specific construction packages ensures adherence to site contract regulation for health, safety and environment. The terms of employment of a contractor's labour force is not under our direct purview."_

So they've got a zero tolerance policy, unless you're talking about the actions of their contractors which is just, like, totally out of their control, man.

1\. [http://www.theguardian.com/world/2013/sep/25/revealed- qatars...](http://www.theguardian.com/world/2013/sep/25/revealed-qatars-world- cup-slaves?CMP=twt_gu)

</comment><comment><USER16> On a side note, is there anyway we can donate money to his family. ~ $1500 with 36% interest is lot of money for his poor Nepalese family and I doubt they will be able to repay that debt. I guess they will have to work rest of their life just to repay money.

I'd be up for donating some money to their family. How do I do it?

<comment><USER17> I'm really hoping they don't have to repay that debt. If it's illegal according to Nepalese law, then surely nobody can force them to pay up?

If they will be forced to pay, that makes an already terrible and inhuman situation even worse.

</comment></comment><comment><USER16> Lot of Indians also work in these countries due to poverty reasons. I feel privileged to be born in a relatively wealthy and educated family in India. If it was not the case may be I would have one of the migrant workers like them.

If these countries have oil money in abundance then why don't they give good working conditions and pay more money. Few million dollars will hardly going to move needle for them. I smell corruption.

<comment><USER18> Corruption by the middle-men, the worst part is fellow Indians/Nepalis run such recruitment rackets and fake certificates and stuff.

Even if those countries wanted to do better, these middle-men would gobble up the benefits and pass the hardwork to uneducated/naive migrant workers.

<comment><USER19> > uneducated/naive migrant workers

I suspect that, due to the internet, prospective migrant works are a good deal less naive than they used to be. Which makes me wonder if Nepalese will still be prepared to work there in future.

<comment><USER16> They are well aware of working conditions. I'm sure some migrant workers might be returning to Nepal and this type of information spreads quickly within rural communities. And Nepalese people will still work for them. Poverty makes people do all sorts of things. And that includes taking risks with your own life.

</comment></comment></comment></comment><comment><USER20> """ ...Nepalese men and women leave their towns and villages for jobs overseas. More than 100,000 head to Qatar, where a booming construction industry and insatiable appetite for cheap labour has been fuelled by its successful bid to host the 2022 World Cup... """

Just like Rome's slaves built the Colosseum so that the upper classes could keep the masses entertained to keep exploiting them.

We really have not learned shit in the past couple thousand years.

<comment><USER21> The difference here is that the stadiums will likely stay empty during the world cup. They are litterally doing that for nothing.

</comment></comment><comment><USER22> Why is this not front-page news of mainstream media? (I know why, it's because it's not profitable). But where is the outrage? Why is fighting back restricted to a few NGOs and some back office of the Nepalese government?

<comment><USER9> Because it would bring uncomfortable questions about the list of states that employ slavery, or effective slavery :

Sudan, Mali, Niger, Chad, Saudi Arabia, Qatar, Kuwait, Pakistan, Bangladesh.

Hmmm I wonder what is driving the advancement of slavery, given that's the places where it's happening. An exploration of slavery would bring the very uncomfortable, but pretty well known, fact to the surface that slavery is part of a particular religion. And the fact that if that religion entrenches itself in a society, it has a very strong tendency to bring slavery back.

(Fun fact : know what the arabic word for slave is ? "Abed". Literally it means "black". "Black gold", when it was a popular term in the 19th and 20th centuries, referred to slaves, not oil.

<comment><USER23> Others have discussed the slavery claims, I'll address the linguistic claims.

The three-letter root عبد, transliterated "3abd", or more inaccurately, "Abed", has meanings related to servant and slaves. It does not mean black. This can be seen in this entry of the Hans Wehr dictionary - [http://tinyurl.com/pk2alcu](http://tinyurl.com/pk2alcu) . You might be familiar with this root from the Arabic male name Abdallah or 3abdallah - <USER3> literally means "Servant of God".

Side note - I'm using the letter 3 to indicate the [http://en.wikipedia.org/wiki/Ayin](http://en.wikipedia.org/wiki/Ayin) letter, which is a throaty consonant in Arabic that is hard for Westerners to pronounce and hear. Because of this, it is sometimes sliced off and ignored when Arabic words are transliterated to the Latin alphabet. However, making claims about the Arabic language while ignoring it is a bit like making claims about the etymology of English words while ignoring the difference between l and r - it can lead you seriously astray.

The color black is أسود / aswad (masculine) or سوداء / sauda2 (feminine) in Arabic, all derived from the three-letter root سود (s-u-d). Dictionary entry at [http://tinyurl.com/q7cadg4](http://tinyurl.com/q7cadg4) . You may recognize this root from the country سودان / Sudan. However, it should not be confused with Saudi Arabia, which is سعودية or sa3udia. Again, the Ayin is present in the word and gives it a very different meaning.

In general, Arabic has a number of consonants that are hard to distinguish for Westerners - this includes the Ayin, the gh (guttural r), the difference between aspirated and non-aspirated h, the difference between emphatic and non-emphatic t, s, d and dh. This means it is hard to represent Arabic accurately with the Latin alphabet without extending it in ways unfamiliar to regular readers. I tend to trust claims about Arabic if the Arabic alphabet is used to explain them, otherwise I would be fairly skeptical.

<comment><USER9> Your reply is technically correct, and yet also entirely false. It's of course true that the color is aswad. I was not talking about the color black being abd. It's just that in English people use the same word for black (the color) and black (the skin).

If it makes things more clear, abed means n-gger. Literally and figuratively.

</comment></comment></comment></comment><comment><USER24> This story make me sad for the human species, it sounds criminal.

On the upside, with tech of course:

Is there any existing app for labor conditions reporting?

If potential employees had a slight opportunity to easily research conditions, they might choose another company with a better record. This would have the potential to drive disreputable shops out of business and promote those that care a bit more about basic human rights. It would be a daunting education and development task, but one that would be meaningful.

<comment><USER25> This is an environment where people borrow $1000 at 36% interest to get placed in a job overseas.

In such an environment, I don't know there's a lot of practical room for, "Nah, I don't want that one; what else you got?!"

<comment><USER24> Predatory lending on top of indentured servitude: dual slavery of the body and poverty.

I'm sure there are much worse and much better companies than what is reported regarding un/semi-skilled labor workforce vendors. The former should not be allowed to survive.

Would be a cool project if someone went undercover themselves to make a docu on the living and work conditions of these industrial sites to expose this further.

</comment></comment></comment><comment><USER26> I am from Nepal. This happens because of poverty and people need to make a living. Awareness is high among migrant workers about the conditions - <USER4> hundreds of thousands travel each year and news travels back. But hope of 200-500 USD per month makes people take risks and the exodus continues.

Once there, dodgy contractors and employment agents take advantage when they can. The exit visa system really doesn't help either. Neither do unstable government, weak economy and low employment back home.

It is an actual fact that in desperation, the poor migrant workers are made to work long hours in extreme heat (direct sunlight). At nighttime, close to the desert where many of these fetid labour quarters are get suddenly cold. Extreme variations in temperature and strenuous manual work is said to have contributed to all these heart attack deaths in young people - as young as 20. I'm not sure exactly because I'm not a medical professional - but the conditions are definitely not conducive to human survival.

The way international community has taken notice with this article does help. Business communities and political interests might do their best to keep the blatant human/labour rights violation under wraps but spreading the news will make their task harder. People from countries with vested economic stakes in these gulf countries etc could do well to pressurise their governments to demand accountability. Work is what the workers want - but in humane conditions. Death should not be an acceptable condition of employment.

</comment><comment><USER27> I am from Nepal. The irony in all this is that we Nepalese will keep flying the Qatar Airways. The Nepalese airlines, a state-owned corporation, used to have regular flights to many busy destinations like Frankfurt. But like with everything that has happened in Nepal for the last 10-15 years, this has gone downhill.

Qatar bribed many Football Associations in FIFA to get this world cup bid. One of them was Nepal. The Nepalese FA's president is in good terms with the Qatari FA, and was apparently given nice kickbacks for voting in their favor.

</comment><comment><USER28> This situation seems like an embodiment of several bad things that can be found everywhere, but all taken to the extreme. They add up to a slavery system.

First of all, I think that slavery is a relative concept. The modern comparison archetype that most people know the most about is the American system of race based chattel slavery. But, there have been many many different systems all throughout history. All different. Slavery is something that exists on a difficult to define continuum.

Many (most?) countries have laws for emoting foreigners. They usually have more limited rights compared to citizens. Deportation looms. Residency is tied to employment. The country is not run _for them._ When it's a Belgian professor teaching in Russia, it obviously isn't slavery. When it's this poor Nepali man in Qatar isn't. There just isn't a clear line between the two. Contracts? Consent? What do those mean when you have the power differences between a Qatari Sheik and an illiterate.

Qatar is comparable in a lot of ways to ancient slave states. There are a small minority (2-5% depending on how you define it) of extremely privileged aristocracy, members of important families. Another 10% of Qatari citizens who make up most of the the professional class. The foreign professional class (10-15%) of mostly arabs and whites. They have fewer rights, but are materially well off. Then a vast underclass (50-60%) of poor foreigners with no rights and practical situations ranging from bad to awful. Work to death conditions. Sexual assault. Chattel-like system of employer-employee relations. Probably similar distributions to famous slave states like Sparta.

</comment><comment><USER29> Slavery in Qatar has nothing to do with religion.

This is the equivalent of taking some example of modern day slavery (say the 20 million alleged [http://usnews.nbcnews.com/_news/2013/06/19/19042103-modern-d...](http://usnews.nbcnews.com/_news/2013/06/19/19042103-modern- day-slavery-state-dept-says-millions-of-human-trafficking-victims-go- unidentified?lite)) and then saying this is part of US history.

Saying slavery is inherently Islamic is like saying slavery is inherently American. And then for proof, going over centuries of quotes about slaves, beatings of slaves, violence during desegregation and the whole entire ugly history of race relations.

Anyone remotely well read knows this is absurd. That what is happening is a matter of individual greed and not some systemic mind control.

<comment><USER30> "That what is happening is a matter of individual greed and not some systemic mind control."

No. The fact that the local populace doesn't care at all and encourages it, means that it is a HUGELY systemic problem.

</comment></comment><comment><USER31> Sounds like [http://india.blogs.nytimes.com/2012/12/17/indias-200-million...](http://india.blogs.nytimes.com/2012/12/17/indias-200-million- strong-dalit-community-faces-discrimination-every-da/)

</comment><comment><USER32> Seems to be the case across the surrounding region

[http://www.independent.co.uk/voices/commentators/johann- hari...](http://www.independent.co.uk/voices/commentators/johann-hari/the- dark-side-of-dubai-1664368.html)

</comment><comment><USER33> This is heartbreaking, but I'm having a hard time seeing the HN angle, except that there was another thread on the same subject earlier today. I suggest this is more suitable fare for Reddit.

<comment><USER34> While I say that anything can fit on HN I have a hard time with articles like this, because the threads are usually full of hateful idiots bickering about things they have little knowledge of.

What have I learnt from the comments to this submission?

</comment></comment><comment><USER35> Seems a dead horse at this point, but this was common-place in Saudi Arabia where I grew up. Migrant workers from Nepal, Bangladesh, Pakistan, Sri Lanka, the Phillipines (from memory) and elsewhere were notoriously mistreated.

My mother worked at a TV & Radio broadcast station for a (...the) major oil company there (side job, father was in oil @ same company), and found out the janitorial staff in her building were going both unpaid and unfed during their workdays for months at a time. I remember helping her with food-drives to pull food from expat communities for them.

It was well known to expat kids running around on-compound that 'gardeners' (generally bangladeshi and nepalese) were absolutely second-class citizens. These people were absolutely degraded at the hands of Saudi nationals and expats of a variety of ethnicities and nationalities (yes, westerners too). I've seen them yelled & cursed at, spit on, and beaten by company Security officers (generally al-Dossari Saudi's, but not always). The horror stories are literally countless.

There seems to have been a lot of discussion in this thread as to the effect that religion has played as a cause of this treatment of migrant workers. I DO NOT know (nor believe) that Islam has a direct role to play, but I can say confidently that this is a reflection of culture. There is a general acceptance of inherent difference in levels of humanity that is tied to national (and tribal) identities in many Middle Eastern countries. I would wager that the majority of the population (at the time I was living there, demographics change fast, and there are a boatload of young people in KSA) would tell you that a Sri Lanken / Bangladeshi / Pakistani != a Brit / American / Frenchmen, etc., and not feel that bad about it.

As I observed it, some of these people believed this as coldly as it is stated above, while a great many see it as a fact the whole world thinks this, but their culture/mindset is 'realistic' ( _shudders_ ) or honest enough to admit it.

I DO NOT believe this is simply a 'rich taking advantage of poor' scenario. In my experience, these people are mistreated far worse than necessary for profit, or probably quite often to the detriment of it. I think it has more to do with cultural definitions of identity than anything else.

</comment><comment><USER29> We have to end this now: [http://usnews.nbcnews.com/_news/2013/06/19/19042103-modern-d...](http://usnews.nbcnews.com/_news/2013/06/19/19042103-modern- day-slavery-state-dept-says-millions-of-human-trafficking-victims-go- unidentified?lite)

</comment><comment><USER36> If CIA wanted Qatar's Royal family gone, they'd ship 50,000 AKs, pick a few leaders from each ethnic group and Viva La Revolucion! Couldn't happen to a nicer bunch of folks

<comment><USER37> The moment these middle eastern countries (Saudi Arabia, Qatar, Yemen) are not useful to Western foreign policy anymore and therefore lose our support, they will probably disintegrate.

You've got citizens that are a minority in their own country, and that are largely incompetent and incapable of running anything, because they never had to do any work.

And then you have a majority of foreign workers that are largely treated like slaves, and probably not happy with that situation.

I can't see who would support those regimes if they get into troubles

Europe certainly wouldn't, politicians here already call those countries dictatorships (publicly) and noone want's to have any affiliation with them.

Russia and China both already had their experiences with terrorism sponsored by those regimes, so I wouldn't expect any support from them either.

I think that particularly Saudi Arabia already sees the writings on the wall and they are actively taking measures but it will be too late, too little.

</comment></comment><comment><USER38> Yes, this is awful, but what more can you expect from the Middle East? On a more political note, did Al Jazeera, report on this ?

<comment><USER39> You should not paint all countries in the Middle East with the same brush.

<comment><USER40> I've only been to a few countries in the Middle East, so I can't generalise. But one thing common among these countries is the lack of warmth, sincerity and humility among the locals. It is one of the most unpleasant and hostile cultures that I have encountered in my years of travel.

They treat blue-collar foreigners as lesser humans.

EDIT: To clarify, I've only been to Qatar, UAE and Bahrain.

<comment><USER41> What a load of crap. So you saw the airport in Qatar, stayed in a 5-Star hotel in the UAE and caught a connection at Bahrain without ever actually speaking to a local??? I can tell you from my experience of living in the UAE for 3 years and regularly travelling to Saudi overland via Bahrain, the locals are just like people anywhere in the world - some crappy, most decent, and some really nice. Minor differences include the fact that they are generally more spoilt, and much more hospitable than people in the west. Most that I've spoken to care about the worker conditions, and would hate to see people hurt, though they worry about being a minority in their own countries, they find it hard to say no to the comfortable lure if unbridled capitalism and its shiny things.

How many of you have actually been to labour camps? I've been to a couple - <USER5> drove on (hardly a "prison") and was invited into the home of a worker, who bought me a juice. There were 6 guys living in a small space (about 10 feet by 20 feet), and they had a rota system for sleeping space. The place was clean and they had somehow managed to afford satellite TV.

Maybe don't be so quick to generalise next time?

<comment><USER40> I worked on various projects in the region for more than a year. That has been my experience. I'm not white, if that matters.

</comment></comment></comment></comment></comment><comment><USER8> There will be no justice for that kid. Nobody will be held accountable.

</comment><comment><USER42> Any free market advocates or Randians care to try and fit this terrible situation into their worldview?

<comment><USER43> | Any free market advocates or Randians care to try and fit this terrible situation into their worldview?

Except anarchists, I think "Randians" and most "free market advocates" are in favor of court (government) enforcement of contracts.

> He was 16

There's a concept of "age of consent" or "capacity" to contract.

> arranging a fake passport stating he was 20

Fraud.

> wages retained

Who would sign a contract like this? It's most likely a violation.

> deprived of the ID cards they need to move around freely without fear of > arrest

Seems like a failure of the State, to be arresting people who are allowed to be there.

> demand their wages, a drastic step given that the authorities can simply > expel them to penury

If "the authorities" refers to the State, I'd say it's another failure of government, not the free market.

> refusing to issue the exit permits they needed to return home

Yet another failure of the State, if I'm reading that correctly as a restriction of the freedom of movement: a basic human right which brutal, anti-capitalist regimes are infamous for violating (e.g. Berlin Wall). Historically, people tend to flee from less free (market) countries to more free (market) countries.

> the kafala system binds the worker to a single employer

Is "kafala" a system of laws? This sounds like Directive 10-289 which Ayn Rand rails against in Atlas Shrugged: "All workers, wage earners, and employees of any kind whatsoever shall henceforth be attached to their jobs and shall not leave nor be dismissed nor change employment"

<comment><USER7> It's a good thing it's illegal, that way these people can fight it in the courts with all the access to legal assistance they have.

One of the biggest drawbacks to the libertarian 'fight-it-out-in-court' mindset is that it considers everyone to be equal, but only if they can afford a lawyer. The people that libertarianism fails the most are the people we're talking about right now.

<comment><USER41> Forget affording a lawyer, they can't even read the contracts that they sign in the first place as they don't read Arabic. Hell some don't even read or write, and have to put an 'X' where their signature should be. Even if they could read it they'd sign anyway, because shit what choice do they have when the family needs feeding? We're talking about asymmetry the like of which people in the developed world cannot begin to comprehend, and that is the reason that unrestrained free markets can never operate effectively.</comment></comment></comment></comment>


BingoCardCreator.com Sale Page - <AUTHOR> http://feinternational.com/buy-a-website/3745-software-business-in-education-niche-25k-gross-mo <comment><USER2> I'd comment but am en route back to Japan in about a minute. If anyone has questions, for example anyone contemplating a sale of their own business, my inbox is always open.

I'm going to be blogging a bit about the sale later but have been holding off to wait for it to finalize (handover day was last Monday) and attempting to not step on a forthcoming Starfighter announcement.

<comment><USER3> How much time and effort was involved in selling the company? Did you need to engage an accountant or lawyer in order to provide documents for the buyers due diligence? Place domain names in escrow? Does this place a lower limit of the value of a company worth selling, because of the costs involved?

<comment><USER2> At least three weeks of full-time work, most caused because BCC was excessively entangled in my other businesses and disentangling them was not always straightforward. (Example: running on a VPS in the same Rackspace account used for AR's VPSes. Rackspace support was not responsive regarding account moves, so I ended up rebuilding an entire environment from metal at another provider then syncing/cutovering. Now multiply that by a sixty point checklist.)

If I had had my affairs in better order it would have been closer to one week of work spread over a few weeks of calendar time. Most of the unskippable process was due diligence, which was a real eye opener. Imagine an ex-Goldman employee quizzing you about a CC chargeback which was reflected in Stripe but not in the revenue books, which he had discovered by examining every transaction for 12 months with a microscope.

I'm told, somewhat to my surprise, that BCC was much better documented than most acquisitions handled by FEI, particularly in this price range. While the infra was lacking it was a major help to have nice clean books.

I didn't get my accountant or lawyer involved aside from a mentioning that I was selling BCC, as it wouldn't have been cost-effective. The deal was executed on FEI's standard purchase agreement with 2~3 clauses added at the buyer's request. Yes, the domains were escrowed.

<comment><USER4> What's the justification in doing three weeks of full-time work, which, at your average published rates is worth roughly $90k, to sell a site for $57k? Wouldn't it be much more sensible to spend the time contracting, making more money _and_ keep the site, which is passive income?

<comment><USER5> > your average published rates is worth roughly $90k

What? Sure, saying "I made $30k/week under one engagement" is cute, but that doesn't mean your _rate_ is $30k/week. When the stars align, you take the nice gigs, but clients aren't standing outside your door begging to pay $750/hr every day of the year.

<comment><USER4> Patrick has said that he could have kept these engagements going regularly.

<comment><USER6> He's also said he doesn't want to.

You also seem to think 30k is the 100% bill rate. A successful consultancy looks to be closer to 70% (and successful in this case means that they don't actively seek customers). The other 30% doesn't come from vacation, it comes from overhead.

The Bingo Card Creator falls into the same spectrum of charge out as Patrick's posted consulting engagements. Whether it was more or less is largely immaterial because consulting engagements are things he's been actively avoiding for a long time, while being done with Bingo Card Creator is something he's actively engaged in.

<comment><USER7> Okay, so 70% of 30,000 is $21,000. Instead of it costing him ~$90,000 worth of time to sell BCC for $57,000, it cost him ~$63,000.

I'm not 100% sure I agree with Stavros' point, and I'd guess that there was a lot of downtime in the 3-week sale in which Patrick was doing other things, but if you read the situation as Stavros proposed it, the economics are the same -- as $63,000 > $57,000, it cost more to sell BCC than to keep it.

<comment><USER8> For the "loss" of $6K compared to seeing your creation die and the loss of reputation for ditching your users I'd say it's worth it.

</comment></comment></comment></comment></comment></comment></comment></comment></comment><comment><USER9> In this thread: people who are jealous of patio11's consulting rates and success, so they try to be "skeptical" (i.e. gratuitously negative) and do some kind of reductio ad absurdum about how it "doesn't make any sense" (i.e. he's being fiscally irresponsibly, or lying) to sell a business when he could "just grow it" (i.e. with no mental effort, cause it's magic to them anyway, or he's lying) or "just drop it" (cause who cares about what you do or leave behind when you have $$$ right?).

Scratch all that jealousy. Grow up and be happy for his sake instead! HN is richer because of people like him. Here's my real comment on this news:

Congratulations Patrick! I'm looking forward to hearing more about Starfighter. You said a few weeks ago a couple of months ago, so you better push something soon ;)

<comment><USER10> I think you might be conflating skepticism with jealousy. Sure, some are probably jealous, but others might be wary of the ebook pimping that was for a time, quite prevalent here on HN, and all from the same circle of folks.

If anything, I think it's preferable that the community engage in pattern matching and question where their heroes come from. It doesn't mean Patrick is a fraud, but it might mean that he's not the god everyone makes him out to be.

I will admit that when I first arrived here on HN, I too believed that his 'status' was a reflection of BCC's success. The way I saw it evolve was that the consulting discussions were only made possible by the fact that BCC was touted as a model product for bootstrapping success.

That could very well be my mistake, but judging by this discussion, it seems I was not the only one to make it.

I think this is why so many people are surprised by the low revenue numbers.

As for the sale itself...3x on a dying business is a pretty good deal if I must say so myself. Questioning the time he put into making the sale is silly. You can't put a price on peace of mind.

<comment><USER11> _Looks around for ebook I 've "pimped"._

A lot of commenters seem to have missed the fact that BCC hasn't been Patrick's primary business _for over 5 years._

He did a whole different product, _after_ getting his consultancy off the ground, that is not Bingo Card Creator.

<comment><USER10> Not you. In fact, prior to today, I wasn't aware you and Patrick were working together. I have no issues there.

I'm not going to name names, but I'm pretty sure most of the community knows the few I am referring to. It just so happens that they've also been speaking at conferences, including Microconf and others like it.

<comment><USER11> Have you bought some of these ebooks and been unhappy with them?

<comment><USER10> That's not the point, and I think you know that.

The point is this:

1\. Person A builds up a persona on HN as a guru, product person, consulting expert, etc. 2\. This person then sells an e-book, leaning upon that reputation. 3\. This person's uses the launch as an example of being successful. 4\. The cycle repeats.

This is an obvious manifestation of the age old Mass Control, Product Launch Formula, etc, and I have no problem with that. My point above is that it's OK for people to vet the parties behind these products, and I think it's lazy to immediately dismiss criticism as jealousy.

<comment><USER11> No, I am literally having a hard time understanding why people are so automatically suspicious of ebooks. My bias on the table: writing books is so non-remunerative that making them almost seems like charity to me.

<comment><USER12> Very often the real return in writing an (e)book is personal branding. It's a pretty effective SEO technique. I don't see why this isn't obvious to you. I _literally_ know more than a handful of people whose primary motivation for writing an ebook was that it would raise their profile. That's half the reason why so many ebooks are free, kind of similar to how and why (partly) people contribute to OSS projects without pay.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER13> I thought Patio11 was an A/B optimization, strategy god...

Why did he abandon BCC?

Reminds me of Tim Ferris and Rich Dad Poor Dad.... those guys make their money selling their brand, seminars, ebooks, etc. and not via the methods/techniques they preach.

<comment><USER14> Focus.

It takes a lot of effort to keep multiple projects in the air. Even something that "runs itself" never really does. I've got Draft going while I work on Highrise, and Draft works very well on its own, but I still have to deal with support requests, downtime, upgrades, refunds, and more.

The guy wants to focus on his other projects. Patrick's never hidden the fact that selling Bingo Cards isn't as lucrative as his other projects. He's super honest and open about what goes down. [https://www.bingocardcreator.com/stats](https://www.bingocardcreator.com/stats) Tons of good lessons he's learned that he's now applied to other business via consulting, Appointment Reminder, and now at Starfighter ([http://www.kalzumeus.com/2015/03/09/announcing- starfighter/](http://www.kalzumeus.com/2015/03/09/announcing-starfighter/))

Look at 37signals. They decided they needed to focus on Basecamp to make it as good as they want. [http://37signals.com/](http://37signals.com/)

We all should be shedding more and more stuff in our lives to focus on the bits we want to grow and see further through. Nothing at all wrong about that.

<comment><USER13> Well according to Patrick's own year in review, BCC is a pretty sizable % of his total annual revenue...

I find it interesting that his goals for 2015 seem to be focused on selling his courseware, etc. on optimization, etc.

This is where the Tim Ferris comment comes from...

<comment><USER15> Well how much makes a 'sizeable percentage'. 10%, 20%? 30%?

<comment><USER13> Looks like close to ~30% last year (after seeing ARR fall by 30%). [1] I think higher in prior years.

He claims to have spent only a handful of hours on BCC last year. So spending less than say 20 hours on a project and having it generate ~30% of revenue, passively, seems like a pretty good deal.

Another poster mentioned focus, but that doesn't really seem to be the case here.

Of course all this is conjecture.

[1] [http://www.kalzumeus.com/2014/12/22/kalzumeus-software- year-...](http://www.kalzumeus.com/2014/12/22/kalzumeus-software-year-in- review-2014/)

<comment><USER16> Patrick is not reporting his full income from AppointmentReminder, he excludes the Enterprise deals.

"Focus" is a very valid reason. Even assuming just one hour per week, that's 52 hours he can spend on something else. Plus having BCC around is a mental burden. Even while you're not working actively on it, you're thinking about it.

</comment></comment></comment></comment></comment></comment><comment><USER12> Interestingly, does anyone remember lionhearted's posts from so long ago, where he pondered over the question why patio11 makes so little money, and why he charges so little? And the community reacted very fiercely, saying that he should let patio11 be -- he's doing his thing, money doesn't matter. And now patio11 is the posterboy for "charge more". How things change! It's kind of fascinating.

Here's the HN discussion link: [https://news.ycombinator.com/item?id=1720244](https://news.ycombinator.com/item?id=1720244)

And here's Sebastian's original post: [http://sebastianmarshall.com/the- genius-and-tragedy-of-patri...](http://sebastianmarshall.com/the-genius-and- tragedy-of-patrick-mckenzie)

<comment><USER17> > And now patio11 is the posterboy for "charge more"

I'd say that, if Patrick had believed in charging more from the start, he wouldn't be nearly as outspoken about it now. It is presumably (close to) the #1 thing he wishes he could tell younger-Patrick—but, since he can't, he's telling everyone else who'll listen.

Actually, now that I think about it, I wonder what Patrick would have to say to the HN community at the time, the one who stood up to defend his undervaluation-of-self? I mean, maybe they'd have defended him no matter what side of the coin he was on, given that he's a pretty central member of the HN "tribe"—but I'd be interested in a corollary post to the "charge more" posts that goes more like "don't praise people for charging less."

<comment><USER11> I think you guys are kind of mixing up his product business, which was a passive income generator, and his consulting practice, for which Patrick never had the problem of not knowing to "charge more".

(I'm one of his cofounders now, and have talked to him a lot about this, so I'll speak up for him while he's on his flight back to Tokyo).

<comment><USER18> I don't see any of the old posts mentioning consulting.

I got the impression that the consulting work started after those old posts, possibly even because of them.

</comment></comment></comment></comment><comment><USER19> I wonder what price could have been achieved had it been marketed as "Patio11's Bingo Card Creator" not _" a well-established software business creating bingo cards for educational and recreational purposes"_.

Patrick's 'brand' certainly has value, at least to me (I've learnt much valuable information from him over the years). And while _homo economicus_ knows this brand doesn't change the underlying business fundamentals, especially as Patrick was exiting, I believe it would have created acquisition competition and therefore a higher multiple than Px3.

The missing 'one more piece of information' in this instance may be Patrick's desire that BCC went 'to a good home', someone who saw potential in what it is, not bought it because of who he is.

Either way, he's now had a successful exit! Congratulations (again) Patrick - feels like only yesterday you stepped out of your salaryman role [https://news.ycombinator.com/item?id=1230156](https://news.ycombinator.com/item?id=1230156)

<comment><USER20> "I wonder what price could have been achieved had it been marketed as "Patio11's Bingo Card Creator" not "a well-established software business creating bingo cards for educational and recreational purposes"."

Assuming it mattered, and I don't know if it does or not honestly, he may not have wanted it to be known that bcc did the amount of sales that it did because that could hurt his brand not help it. Not that he ever called it anything more than iirc "wee" but honestly I kind of expected that the sales and/or profit was more than what the sale page said and that assumes that sales have been going up and not down.

As far as the patio11 brand that only matters to people on HN nobody in the rest of the world cares about that at all. All they care about is what the business will make and what the product is and what they see as the potential. Which, quite honestly given the product (and especially since Patrick ran it) seems nominal to me, given the amount of time it was in operation.

Obviously there was a reason he didn't publicize the sale on HN and the brand. You can draw your own conclusions.

<comment><USER21> _> he may not have wanted it to be known that bcc did the amount of sales that it did_

Patrick has published annual BCC revenue, to the dollar, since it started:

[http://www.kalzumeus.com/2014/12/22/kalzumeus-software- year-...](http://www.kalzumeus.com/2014/12/22/kalzumeus-software-year-in- review-2014/)

[http://www.kalzumeus.com/2014/01/06/kalzumeus-software- year-...](http://www.kalzumeus.com/2014/01/06/kalzumeus-software-year-in- review-2013/)

[http://www.kalzumeus.com/2012/12/29/bingo-card-creator- and-o...](http://www.kalzumeus.com/2012/12/29/bingo-card-creator-and-other- stuff-year-in-review-2012/)

[http://www.kalzumeus.com/2011/12/21/bingo-card-creator- etc-y...](http://www.kalzumeus.com/2011/12/21/bingo-card-creator-etc-year-in- review-2011/)

[http://www.kalzumeus.com/2010/12/17/bingo-card-creator- etc-y...](http://www.kalzumeus.com/2010/12/17/bingo-card-creator-etc-year-in- review-2010/)

[http://www.kalzumeus.com/2009/12/18/bingo-card-creator- year-...](http://www.kalzumeus.com/2009/12/18/bingo-card-creator-year-in- review-2009/)

[http://www.kalzumeus.com/2008/12/21/bingo-card-creator- year-...](http://www.kalzumeus.com/2008/12/21/bingo-card-creator-year-2008-in- review/)

[http://www.kalzumeus.com/2008/01/13/year-2007-stats-and- year...](http://www.kalzumeus.com/2008/01/13/year-2007-stats-and- year-2008-goals/)

[http://www.kalzumeus.com/2006/12/26/merry-christmas- part-2/](http://www.kalzumeus.com/2006/12/26/merry-christmas-part-2/)

</comment></comment></comment><comment><USER22> I think this shows that software product valuations really are variable.

People quote things like "2x revenue" all the way up to "15x revenue."

If these stats are correct, patio11 sold his for roughly 1.8x yearly revenue.

If revenue and margins stay stable, the new owner will recoup their investment in 3 years. This seems reasonable to me.

<comment><USER23> 3 years in a very unpredictable field is a very long time. Anyone can come up with exactly the same product in much less time than before.

<comment><USER24> That's true - what is gonna be much harder for any new competitor is to match BCC's SEO. Nine years worth of intelligent, diversified, and Google friendly reputation building is not going to be duplicated quickly.

It wouldn't be an _impossible_ task to outcompete BCC I suspect, especially if the new owner just lets it coast and wind down instead of staying on top of the game (which Patrick readily admits he hasn't done for some time), but I suspect you'd probably need a PPC budget of around the same magnitude that the new owner just paid to kick-start a competitor - even if you already had production-ready code and a suitable hosting platform ready-to-go.

I think you're right - in that assuming "it'll be paid off in three years" is a naive view of the way SaaS businesses age - but I also suspect there are already several "exactly the same product"s out there already, none of which have got the traction BCC has, and that the value here is not in a bunch of code that makes PDFs from lists, but in the business backend and the historical web presence and SEO.

<comment><USER11> My understand of this is roughly:

* There's a fairly liquid market for sites of any sort that have a demonstrated ability to generate revenue.

* The valuation of those sites goes up when revenue is recurring.

* The valuation goes up with history/track record.

* That market is not especially oriented towards teachers.

Given the universe of different sites you could build that would charge a subscription fee to serve some niche of customers, it would be pretty weird to compete for the Bingo Card space.

(I was surprised at how liquid the market for this stuff was.)

<comment><USER25> "(I was surprised at how liquid the market for this stuff was.)"

I'm fairly surprised by this too. Why do you think that market is so liquid?

I will note that in Software, Entrepreneurship == Innovation in many people's minds (i.e. a startup inventing something new).

In non-software entrepreneurship, buying an existing business and running it is considered a very common path to becoming a business owner. As is starting a copy of other existing businesses (e.g. another restaurant), or even flat- out extending an existing business (e.g. the amazingly successful business innovation of "franchising).

<comment><USER11> I don't know. I personally feel like it _shouldn 't_ be as liquid as it is; it seems like an extraordinarily risky way to earn a return that is, after expenses including time, not that much better than what you might get aggressively investing in the market.

<comment><USER6> I'm shocked by both the liquidity and the valuation (in that it is more liquid and higher than I would expect).

Further, the income generated from BCC is extremely seasonal and its not anti- seasonal with other education based markets. All in all, I'm as interested (if not more so) in hearing from the purchasers as I am from Patrick.

</comment></comment></comment></comment></comment></comment></comment><comment><USER26> Being late to the thread, so probably nobody will read it. Anyway:

Looks like there are very few corporations out there, that are able and willing to buy such SaaS products. Remember how long 37Signals tried to get rid of their jobs-site and various non-Basecamp products? Nobody wanted to pay the price despite that the businesses were profitable.

Maybe the USP of those products is tied to extensive niche knowledge and networking. Both is very hard to transfer. Potential acquirers usually know nothing about the market and also know, that they will need some very good developers and marketers to keep the revenue stream alive, because the previous owners really set a high benchmark for that.

In both cases I personally would have tried to transfer the business to current employees in exchange for a commission based on the future revenues paid over 5 years. Both parties involved know how the business works and can project the future success better than everyone else out there. There is usually also enough trust and communication culture in place.

However, this is not a "quick" exit and the seller is still connected to the business/people for a long time. That risk needs to be covered by the commission, of course.

</comment><comment><USER27> I don't get it why is this front-page and up voted 30+times?

<comment><USER28> Patio11 is one of the local celebrities, his articles and comments are very interesting. He is currently the #3 user with more karma, just after tptacek and pg (the very site owner).

Profile: [https://news.ycombinator.com/user?id=patio11](https://news.ycombinator.com/user?id=patio11)

"Author:patio11" in Algolia: [https://hn.algolia.com/?sort=byPopularity&prefix&page=0&date...](https://hn.algolia.com/?sort=byPopularity&prefix&page=0&dateRange=all&type=all&query=author:patio11)

"Patio11 fan club" in hnapp: [http://hnapp.com/?q=author%3Apatio11%20%7C%20host%3Akalzumeu...](http://hnapp.com/?q=author%3Apatio11%20%7C%20host%3Akalzumeus.com)

<comment><USER29> I couldn't see pg in the leaders list but he does in fact have the second most karma (unless there are others missing from this list).

[https://news.ycombinator.com/leaders](https://news.ycombinator.com/leaders)

</comment></comment></comment><comment><USER30> It would be interesting to know how much work is required to keep the business running. The multiple is quite low (3x profits) and to me the business seems already established (or even 'finished' if you allow the expression), so either I'm underestimating the amount of work that is required to keep it going, or there is another reason why patio11 would be so keen to offload it?

</comment><comment><USER31> Why did you choose to broker through feinternational, vs say flippa?

<comment><USER32> He commented on this here: [https://news.ycombinator.com/item?id=9588901](https://news.ycombinator.com/item?id=9588901)</comment></comment>


Ask HN: Your very first e-mail address. When did you get it and why? - <AUTHOR> <comment><USER2> My very first address was a BITNET address. This is pre-Internet: see [https://en.wikipedia.org/wiki/BITNET](https://en.wikipedia.org/wiki/BITNET) and my address, which I don't recall, was specified with a "bang" address: [https://en.wikipedia.org/wiki/UUCP#Bang_path](https://en.wikipedia.org/wiki/UUCP#Bang_path).

I would have gotten this around 1986 while at the College of Wooster. Honestly, I don't think I used that address very often for e-mail. At least, I don't recall using it much, although the details are a little hazy in my memory now. I don't have an archive of anything I sent and received back then. My earliest archived e-mail messages start around the fall of 1990, when I got an account on the University of Michigan's mainframe, and I think that account used the modern scheme for Internet e-mail addresses.

<comment><AUTHOR> Wow, I hadn't heard about any of this before now... that's awesome.

</comment></comment><comment><USER3> Hmm, I've only had two email addy's over the last 30+ years, pretty sure the first one was 1986 or '87 when I opened an account at portal.net, in Cupertino, not too many private isp's back then.

I got it to keep up with my fellow caver friends and join the cavers mailing list, a private list for NSS members who were actively exploring caves all over the world.

For my "computer", I couldn't see spending 3 to 4 k on a laptop, so I dropped $350 on a Brother Power Note and an rs232 modem, together they did everything I needed and wowed all my friends when I printed out a cave plot in the middle of the Mojave Desert on my tiny battery powered B&W printer.

I used my first Password in 1977 at work (private telco interconnect in silicon valley), it was DEVO, yes, I was referred to as the company's resident punk rocker service technician.

</comment><comment><USER4> Hotmail. I was about 8 years old I think. My mom wouldn't let me use my real name, so it was (partial real name) + email@example.com

Later on I made games and my dad said the name looked trollish. So I switched my main email to (real name)@gmail.com

</comment><comment><USER5> My first wasn't accessible from public Internet (defense contractor).

My second started in 1986, well before we had domain addressing, so a sender had to know 1) our corporate hostname, 2) my username, and 3) a well-known host to route through (like uunet, pyramid, decwrl, etc.)

The convention for publishing my address, therefore, was

      {pyramid|uunet|decwrl}!infmx!aland

I was actually the first person in the company to put my email address on my business cards! I still have some from then.

</comment><comment><USER6> Hrrm... I think maybe it was my email when I was at UNC-W back in the 90's. I don't remember what it was now though. Maybe something like firstname.lastname@example.com or something like that.

My first personal email though, was firstname.lastname@example.com. This would have been about 1996 or 1997 or so.

Some things never change, huh?

</comment><comment><USER7> 2003, I was about 10 years old, I didn't speak any English and I just thought it was the coolest thing ever to have my own e-mail address so I somehow registered for a Yahoo account. I still have it.

</comment><comment><USER8> 1996, dad set up firstname@ email addresses for us on his new mail server. By 1999 I had to move to a new one (not firstname@ this time, but a unique name) due to spam.

</comment><comment><USER9> firstname.lastname@example.com

mr hankey as the title of some southpark episode.

Didn't want to give out my real name back then. Won't give my name to any mail provider today.

pseudonyms forever :|

</comment><comment><USER10> First email was at a now defunct ISP called AsiaOnline, and was a combination of mine an my father's name (as he bought the modem haha)

</comment><comment><USER11> Comcast - don't even remember the handle. It was provided when my family set up internet through them in the 2000s.

</comment><comment><USER12> College in 1993 and then an address at my own domain, which I still use as my primary address, in 1997.

</comment><comment><USER13> 1992: it was a local ISP. In 1993, I got a UUCP feed to my BBS, including email and Usenet news.

</comment><comment><USER14> firstname.lastname@example.com About 1992, it came with the dialup Netcruiser Internet service.

</comment><comment><USER15> Hotmail to use MSN Messenger in the fourth grade. Circa 2004/2005.

</comment><comment><USER16> My first email address was a Yahoo! address in 1997.</comment>


Get the perfect Google Voice number, Grep-style - <AUTHOR> http://michele.spagnuolo.me/blog/2013/3/17/get-perfect-google-voice-number-grep-regex/

<comment><USER2> This will be great until Google sunsets Google Voice next year.

<comment><USER3> The good thing about google voice is that when it is finally axed, the US laws require them to give a way to port numbers. That's the only reason why I was comfortable using their service

<comment><USER4> > The good thing about google voice is that when it is finally axed, the US > laws require them to give a way to port numbers.

Or what? What's the penalty if they don't?

<comment><USER3> You can do it today: [https://support.google.com/voice/bin/answer.py?hl=en&ans...](https://support.google.com/voice/bin/answer.py?hl=en&answer=1316844&topic=1708124&ctx=topic)

You can initiate the request from the other side (the new carrier), in which case it is forcefully wrested in a day. If google still refuses, you can complain to the FCC.

As for google penalties for holding your number hostage, given that the business is dying there's really nothing other than an FCC lawsuit (which, as you imagine, would be for a paltry sum)

</comment></comment></comment></comment><comment><USER5> I got into Google Voice very early on. I grabbed a number ending in 1337 in my area code.

That's now become my main number I give out to people. It brings a smirk to the few people who get it :)

<comment><USER6> I got KOR-DUMP. =)

<comment><USER7> I got ROF-LLOL. It's quite the conversation starter, ha.

</comment></comment></comment><comment><USER8> The GV Android app still feel slow even on my N4 and haven't seen new feature added for couple years. MMS missing and still lacks Chinese language support.

</comment><comment><USER9> I still used Google Voice some; like others mention it's a safe number to give out for calls and txts when you're not sure how contentious the receiver will be with the number.

I've switched to RingCentral for my main forwarding number as it has more features, though there's a monthly cost for that service.

</comment><comment><USER10> What point is Google Voice at now, usability-wise?

I used it in 2010 and it was slow to make outgoing calls and had some limitations as far as text messaging from the gv number. There were also some concerns about its general reliability.

Is anyone using it fulltime now and happy with it?

<comment><USER11> I use it exclusively, and it is perfect for me, mostly. I can text from any of my android devices, or any device with an internet connection almost entirely reliably. Here's the foibles though:

* No extended MMS support AT ALL. This means no pictures, no participating in group messages from iphone users, and most critically, all text messages sent or received over 160 characters aren't automatically concatenated like on the iphone and in the stock android messaging app, but instead chopped up into several 160 character messages.

* Quirky reliability. It's been getting slowly better, but there are small issues occasionally that are pretty rage-inducing. For example, before February of 2012, there was no queuing for SMS messages. If you tried to send a message and it failed, (which happens a lot) too bad, you got to try again. So when they did implement it, (way after the introduction of the product, I might add) it was slow and argumentative as to which messages actually got sent out and when.

* Product support. Lusting after a basic new feature for GV? Having an issue where some messages are duplicated 4 times and sent to everyone in your address book with the same first name as the recipient? (it happened to me. The solution was to name problem contacts things like John1, John2, etc. until an unspecified update fixed it) Just curious about the future of the product? Too bad. You will be lucky to get a minor update a year later which addresses a complementary issue or concern. No amount of support questions, bug reports, emails, or even community outrage will get anything out of Google concerning GV. It took them months to update it to the ICS app standards, and they did so without any warning or response to users who had been begging Google to fix the buggy Gingerbread/Froyo-imbued app since Honeycomb had come out. For some reason Google is hell-bent on being tight lipped on this particular product and none of its users have any idea if it will even continue existing for the foreseeable future. Now that Google has used it to datamine a bunch of voicemails for transcription data, it feels like we're just along for the ride on this product that we rely on every day.

<comment><USER12> Multiple concatenated SMS messages are not MMS, should be able to be done without full MMS support at all. Even old Nokia phones years ago had that supported.

<comment><USER11> You're right, it should. But Google Voice doesn't do it.</comment></comment></comment></comment>


Android Play store does not ask if apps want new permissions on update - <AUTHOR> http://stefan.gofferje.net/news-blogs/security/198-security-warning-android-play-store-does-not-ask-if-apps-want-new-permissions-on-update

<comment><USER2> It only doesn't ask if you've already granted permissions from the same group. So if it asked for camera access before, and now asks for video access too, you won't be prompted.

</comment><comment><AUTHOR> PoC exploit: [https://github.com/tube42/permtester](https://github.com/tube42/permtester)</comment>


Google Penalizes Overstock for Search Tactics  - <AUTHOR> http://online.wsj.com/article/SB10001424052748704520504576162753779521700.html <comment><AUTHOR> The article mentions a complaint by a competitor, but there was also a thread about Overstock here: <http://www.webmasterworld.com/google/4252178.htm>.

<comment><USER2> There's a mention of a utdallas.edu page in the WMW comments, which is now dead, but the cached version is here:

[http://webcache.googleusercontent.com/search?sourceid=chrome...](http://webcache.googleusercontent.com/search?sourceid=chrome&ie=UTF-8&q=cache%3Ahttp%3A%2F%2Fwww.utdallas.edu%2F~vxa081000%2FLife.html)

Just a quick glance says that is definitely not an earned page of links. I'd love to know if Overstock gave Mr. Arora just a discount, straight up cash to post, or what. And how did they reach out? Did they email every student at utdallas.edu and offer them an incentive in exchange for posting a page on their personal site?

It actually makes me feel a bit better to see this is actually pretty black hat, and not (at least in my reading) quite as debatably paid-links as the Journal's story made it sound.

<comment><USER3> A client's competitor had some strange .edu links. Did some research and they are sold all over, including Fiverr. Here's an example: [http://www.fiverr.com/users/originalseo/gigs/20-edu-and- gov-...](http://www.fiverr.com/users/originalseo/gigs/20-edu-and-gov-profile- backlinks-to-boost-your-ranks-limited-time-offer?ref=glst-g-ttl)

P.S.: Don't buy links.

<comment><USER4> Mainly because if you're paying, you're paying too much. What you want to be doing is creating highly relevant content in PDF/word docs w/ links and then uploading them to forums. Can't nofollow a PDF/doc link :)

<comment><USER2> I've noticed that Matt Cutts always dances around the question of whether links in PDF's count.

<comment><USER4> My opinion is that they do count. Intuitively, a URL is a URL and whether it's from an HTML document or a Word doc it's the same thing. You'd have to put in a bunch of extra code to make it not work like that. It's a $9 test, get a random domain fhg56784ei3dg.com with a random keyword, do absolutely nothing with the domain, throw a link in a PDF and see if your site gets indexed :)

<comment><USER5> I intend to test this eventually, but I think the test has to be a little more complex since you want to measure if it shares google-juice, not just that Google reads the URLs.

Ideally I'll registering two random number domain names, both with random text around a unique word, then mention one in a keyword rich PDF and see which domain pops up first in the Google search.

<comment><USER4> It's not just about google juice. You can boost pages within your own site with internal links. Also, people search for an absolutely stupid amount of stuff on torrent sites. Try putting your PDFs on torrent sites for a little extra traffic. If you seed it on the right trackers all the torrent sites pick it up for you for free.

As well sometimes the torrents themselves rank really well. Keyword stuff your torrent files :) Remember to set the utm_source on your PDF links.

</comment></comment></comment></comment></comment></comment></comment></comment><comment><USER6> Is breaking Google's rules now a PR/link building tactic? WSJ didn't link to Overstock.com in their article, but if they did, then Overstock would have built a really strong, legitimate backlink as a result of their illicit practices.

I also think the article plays down what Overstock.com did. I'd love to hear what Matt Cutts has to say about it, but offering a discount to students and encouraging them and their universities to link to said discount page doesn't sound like it should violate Google's policies. Judging from some of the links posted in other comments, it looks like Overstock.com was being far more manipulative than that.

I'd also question whether this is actually a penalization? Or did Google just devalue the links that weren't kosher? I see those as two different things.

<comment><USER7> Google has said in the past that they defuse links and ignore any pagerank they would pass if they determine their are paid or for the sole purpose of passing pagerank. So, yes, there is a difference between penalties and devaluing links.

edit: here's some of that discussion <http://www.mattcutts.com/blog/text- links-and-pagerank/>

<comment><USER2> You be the judge... should links like these be devalued or penalized?

<http://support.coastal.edu/NetCommunity/Page.aspx?pid=304>

</comment></comment></comment><comment><USER8> News flash: every highly competitive search vertical is full of this and has been for years.

<comment><USER9> So it would seem possible to make a business out of entering these verticals and then reporting all the competitors for violations, leaving you left.

Obviously this assumes that most competitors do something like this, but if so that could be a nice way to make money.

<comment><USER2> Heh... 3 years ago, I registered several domains around offering exactly this service.

</comment></comment></comment><comment><USER10> <http://www.abac.edu/goldcard/Discount%2520listing.pdf>

Scroll to the bottom.

<comment><USER11> 404

Can you tell us what was there before?

</comment></comment><comment><USER12> So why isn't Google better at search? Seriously. They're like tax legislators, constantly surprised that people game the system. Only they have less excuse, because there's no transparency in Google's 'laws,' and no coherent way to distinguish 'white hat' and 'black hat.'</comment>


Giants Win The World Series - <AUTHOR> http://scores.espn.go.com/mlb/boxscore?gameId=321028106

<comment><USER2> It was a great game!</comment>


Tell HN: Posting a link that's behind a paywall (ie NYTimes) is annoying. - <AUTHOR>

Please don't post content that lives behind a paywall. <comment><USER2> I disagree. Some information is worth paying for. If it was voted up, others agreed. You are always free to avoid it. How will we get high quality investigative content if none of us wants to pay for it?

<comment><AUTHOR> I will agree with you, and amend my position to coincide with zeynel1.

It isn't that paywalls are bad -- good content should be paid for. I just don't think it makes sense to submit a link to a site when only a subset of that site's users can see it. Ruins the fun...

</comment></comment><comment><USER3> NYTimes has selective access to a lot of the front page stories, visiting nytimes.com not logged in won't normally allow you to advance past the little blurbs to see full articles (connection, location, time of day, visitor amount dependent). You'll notice however Google searching the article title and then choosing the first result will take you to the full article.

Could anyone else shed some light on this?

</comment><comment><USER4> Far more annoying, to me, is comments on articles complaining that they're behind a paywall (especially when it's actually a registration wall). So, while I understand that it may be frustrating to some people, please don't post comments complaining that an article is behind a paywall.

</comment><comment><USER5> FYI If I'm not mistaken you can link to the mobile version of the story on NYT and it will be "free"

</comment><comment><USER6> NYTimes is not a paywall.

</comment><comment><USER7> Seconded

</comment><comment><USER8> Amen

</comment><comment><USER9> It would be nice if the title indicates that the article is behind a paywall.</comment>