One of the problems with distribution of Steem is that it was initially mined. Once commanding amounts of Steem were concentrated in the accounts of the founders, Steemit was born, and mining was disallowed.
As you can imagine, this essentially created a permanent oligarchy, and BS was one of the flashminers.
"...the Witnesses? Do they vote on changes to the code that change the payout algorithm or is that completely controlled by Steemit Inc., which from what I hear 51% owned by @ned?"
The top 20 witnesses are the sole means of crafting the blockchain, completely responsible for the code. However, they are completely controlled by money, as you point out asking about @freedom. Stake-weighting votes for witnesses has put these witnesses and this code in place, and keeps it so.
@ned may have sufficient stake (its impossible to know, since he may have any number of accounts) to control the witnesses on his own, so he and Stinc do retain significant control. Given the identical purposes of major stakeholders primarily interested in ROI, he doesn't have to actually exert that control, but his opinion in consultations on matters is given more weight than his personal stake provides as well.
The witnesses are told what code to run that Stinc and devs write, and them as don't are replaced. Stinc and devs write code to serve their market, which is now 35 whales that own almost all Steem.
"how many of the developers making the changes to Steemit are also Witnesses who are also the ones at the top receiving the financial benefits of being a whale and so have little incentive to change what works for them at the expense of the minnows? And who is @freedom who single-handedly puts several witnesses into the top spots making millions annually (potentially)?"
Many top witnesses are devs. You can see their wallets, just as you can see anyone elses. I am not aware of any of the top 20 witnesses being abjectly poor. It is financially rewarding to serve the whales, as you can imagine, whether they are whales themselves or not. Witnesses that defy the whales aren't witnesses anymore, and another that will more willingly cater to their whims will be elected with their SP.
@freedom, I dunno. I can speculate, but what's the point? I don't actually know.
I want to point out here that many folks seeking to resolve this issue don't want some kind of government control to make all the bad things go away.
Steemit is a government, just as it is. What I have long advocated is that VP be weighted by rep, rather than SP, for reasons I have repeated ad nauseum elsewhere in comments on this post, and in many other posts and comments.
I don't want centralized government, which is what we have now, even if it's benign in intent. SP being the mechanism that creates voting rights, just as in corporations since time immemorial, creates the same pressures for the corporation to have no regard for anything but ROI.
Societies are much more than economies, and far more valuable than mere money. Rep is the closest thing we have to an egalitarian means of establishing a just and popular means of controlling the platform, and SP, particularly in view of the flashmine that created most of the Steem in the known universe, and that will financially dominate the platform in it's present form as long as we will live, creates an extremely dictatorial power imbalance, which precludes a fair and just government for most folks.
Consider what Dlive is currently doing. Dlive is delegated significant stake by Stinc. Many are complaining that Dlive is now autofollowing people to accounts they didn't choose, thus pushing content at them, just like Fakebook does to it's users.
This is an indirect abuse of the SP flashmined by extant oligarchs, seemingly intent on creating profits through Dlive.
That's not the government I want. I don't think most on Steemit want that kind of centralized control of content.
Basing VP on rep would end that abuse of plutocratic power.
Thank you so much for this thorough reply. Sounds like a good solution. Any idea if @dan is going to start off with a legit content curation platform after releasing EOS? BTW, if you run for Witness you got my vote! I have yet to find a witness that will acknowledge what you have said and pledge to do something about it.
If you ask witnesses that aren't in the top 20 you will find some that will at least acknowledge there is a problem. The top 20 are pretty solidly entrenched in the extant milieu, and what I have got in response is 'I don't agree.', or nothing at all. I have seen them discussing the problem of Sybil attack due to the centralizing influence of stake-weighting amongst themselves, but it's not something they are paid to advertise.
Consider that a takeover of the top 20 witnesses will involve acquiring at least 15% of the Steem in existence, and it becomes apparent that this isn't just a mechanism that keeps them in control now, it's also a golden parachute that cashes at least some of the oligarchs out when SHTF.
I reckon @dan is one of the primary architects of the current stake-weighting system, and suspect any new platforms he may contribute to will be similar. I have read some of his posts on other platforms (he's a coder. You can find lot's of stuff he says on Github) and suspect he's a fan of coporocracy, rather than egalitarian systems. That's only my sense of his take based on my own lapses of deep understanding of his person, and meager exposure to his writing, so don't take it too seriously.
You can find out more about what he intends to do by reading his off-chain blog on Github.
Well if you know who those witness candidates are let me know and I'll vote for them, or I could even delegate my witness vote.
Thanks again for your replies. I wished I had a better way to dig up this kind of info and make a post explaining it to people. I tend to be the historian wherever I go, but feel like I'm just stabbing in the dark with this platform.