Episode 33.
What does this quote mean?

Question:

What does the quote "the nail that sticks up gets pounded down" mean?

Key Points:

  • The original usage fo this quote was in communism
  • The way communism was supposed to work: "From each according to their ability; to each according to their need"
  • Capitalism is essentially the opposite of communism
  • In a pure communist country, there is no link between the work do and what you receive
  • Native American tribes often opperated a lot closer to a communist community than what we have today, and this worked because they were small enough for everyone to know each other and hold each other accountable
  • On a large scale, communism doesn't work because there's no accountability
  • In a pure capitalistic society, what you live off of comes from the work that you do. End of story
  • The military is part of the government
  • Originally, the quote in question was used in communist Russia. It was used to teach people not to be unique
  • I took this quote to be similar to "the squeeky wheel gets the grece" or the bible verse in Luke 11:5-8. Both of these teach that those who are persistent get what they want
  • If you want something, then you need to stick up in order to be pounded down
  • In capitalism, standing out is a possitive; it is the person who "stands out" the most that gets a position when competing for it
  • A lot of recent research has shown that 3 great people will generally get paid less than 6 average people, but they will have more output. Therefore, a company is much better off hiring great employees than mediocre employees
  • Google had a study which showed that the top 10% of their developers produced 10 times as much as an average developer
  • This is true because of the way risk works in the job market
  • It is a risk for the company to hire a great employee away from a different company.
  • Employees also have risk when they change roles: it might not be as good as the company/role that you left
  • Most employees should not have as much fear as they do when changing roles
  • There is no intrinsic unfairness because everyone is able to participate in the market in the same way
  • A large majority of Americans are employees. Employees trade their time for money because they are paid a fixed amount to show up and do their best. There are others which are paid for their output, e.g. company owners or contractors/consultants
  • Synopsis: In communism, the quote means that you should not stick up because you will get "pounded down". In capitalism, if you can stand out and show that you can achieve something, then you will get what you can show you are capable of