Top 0.1% to pass bottom 90% of Americans in combined wealth

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ucim
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Thu Dec 11, 2014 8:57 pm UTC

Tyndmyr wrote:And if you have a healthy, competitive industry, GM dying should mean that other car companies take up the slack. Not having a healthy, competitive industry in the first place allows such conditions to emerge.
Yes, it should. But this takes time. And "too big to fail" is part of not having a healthy, competitive industry. It's a symptom of too few players (therefore too-large players) in a big field. Big players have an economy of scale, so things naturally gravitate in that direction, and the bigger they get, the easier it is to push risks onto others and get away with it.

If there are fifty car companies, losing one is no big deal. But if there are only two, it is.

Tyndmyr wrote:And yes, you ARE taking the company away from it's owners. Giving shares to the "public" necessarily dilutes all other shares issued. Shares are ownership. How could it be anything other than a transfer in ownership?
You are technically correct; I was referring to a prior post in which I was accused of being willing to take a company away from its owner, but not take money away from someone who is "too rich".

And the dilution of shares is (proposed to be) proportional to the amount that the company is taking from the public by pushing its risk onto the public. When a company does that, it steals from the public in a manner similar to the way pollution steals from the public. In both cases, restrictions and/or compensation is called for.

Do you disagree that a company that pushes its risks onto the public is stealing from it?

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby mat.tia » Thu Dec 11, 2014 9:20 pm UTC

ucim wrote:I am not (for example) defending such a society (as if that kind of society were better than others), even though some jump on me as if I were. Rather, I am defending against what I think is a misplaced focus on cause.

The statement "(super-)rich people have too much money" reads as if that were a problem in and of itself, a statement with which I disagree. I look further.

"(Super-)rich people have too much power (which their money lets them purchase)" is closer. But it can be generalized: "{These people} have too much power", which seems to be the actual problem some have with the super-rich.

And it is the attainment of power that should be the focus... how money is turned into power. Because sometimes it's appropriate, and sometimes not.

There's several problems related to such an unequal distrubution we spoke about; not only the power concentration. But regarding that one, of course in an ideal world money is not equivalent to power. Do you want to discuss how to get to such a world? Great!
Otherwise, you need to take for granted that, above a certain unquantifiable threshold (which I argue is relative to the total amount of wealth available), money gives you too much power. Legally.

Tyndmyr wrote:Capitalism is improving the lives of the poor. That's why the whole immigration issue exists. They want to upgrade to what we have.

False. They are moving to capitalist countries for two main reasons: war and poverty. Both of them are usually exported by capitalistic nations. Because, you can say that economy is not a zero sum game and that the rich are making everyone richer, but it's a fact that capitalist countries are exploiting resources belonging to other countries. Human labour included.

Many studies show a reverse direct proportion between the level of average personal wealth of a country and self reported happiness of its citizens. I have one by the Economist on paper, if you want me I'll take a picture of it. [edit: looking for the article on the internet brought me to various studies with contradictory results. On average the correlation seems very weak, slightly but not regularly skewed towards richer countries]

Tyndmyr wrote:And, if you don't care about consuming more, why do you care about getting richer, or others getting richer?
I don't care about getting richer, nor others getting poorer. I care about a healthy society that is devoted to develop and incentive the finest human activities and qualities. I think a wealth distribution of this kind gets in the way of that.

Tyndmyr wrote:but consumerism is STRONGER among the poor, relatively speaking. They are less likely to save and invest, and instead, expend money on consumption.

duh. if you have little money and need to eat, feed your family, pay the rent, buy a cellphone and a car, you're less likely to save or invest.
Also, poor people tend to be ignorant because of their poverty (of course you're free to believe it is vice versa), hence much more easily influenced by ads.

About humans being seen as resources, your argument is preposterous. You said "we've just been trained to consider human labor different than resources". I criticized your argument for two reasons:
1) philosophically speaking, it is just based on nothing. As I said, the terms "human resources" and "consumer" are very recent. On the contrary, the term "soul" is quite ancient. Wonder why?
In whole history most of the cultures thought humans had souls. This makes them different from tools.
Of course people have used each other all the time. But it is false to say that nowadays common habit of thinking of people as any other resource has always existed. Tons of books have been written about the role of humanity in history and the recent shift of attention from human life to Techne (and hence economy).
2) logically speaking, it is nonsense. If your goal is to improve human life, to consider human labor as a resource as any other is nonsense, since it is an aspect of the human life you want to improve.

Tyndmyr wrote:What you are quote sniping simply follows a fairly standard example of how trade and specialization enable a net economic gain. It would be difficult to take any economics course without encountering this idea. Simply dismissing basic concepts with talk of goals is ridiculous.

So you're saying I'm ignorant and I should stay out of the argument. True, I am ignorant. I made questions, many. Some, were addressed. Others, not. Amongst these was the definition of wealth, which is in the title of the topic; you have at first agreed on the definition I gave. Then decided to change your mind, and adopted someone else's.
I criticized that other definition attempt using the argument of advertisement. You haven't replied in merit and haven't proposed a definition of "wealth" yet.

Tyndmyr wrote:You don't think that wealth has anything to do with better lives? Really?

I didn't express myself clearly. What I meant is that if you want to talk about improving life in general, wealth has just a part in it. You cannot reduce quality of life to $. You just can't. So let us stick to a definition of wealth that is not "quality of life".
Last edited by mat.tia on Thu Dec 11, 2014 10:13 pm UTC, edited 3 times in total.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby Zcorp » Thu Dec 11, 2014 9:31 pm UTC

Tyndmyr wrote:Capitalism is improving the lives of the poor. That's why the whole immigration issue exists.

I don't understand how you think this is relevant.

Are you now arguing that the poor in America live great lives? That because America poor is better than Mexico poor there is no problem?

And, if you don't care about consuming more, why do you care about getting richer, or others getting richer?

So I need to be unhappy with my level of consumption to care about the inequality of consumption between other people?
Please please please stop the fucking straw-men.

elasto wrote:I disagree with Zcorp. I think that is a valid example of everyone becoming richer.

I didn't say CU's example was not a valid one of everyone becoming richer. I said that's not how the economy works. If it did work as it does in his example we would have a positive sum game.


CorruptUser wrote:Ergo, economics is not a zero sum game.

I'm gunna try this again, hopefully simplifying it further will help clarify my point.

Zero-sum game = win, lose
Positive-sum game = win, win

Now, please take note that I have never said the economy is a zero-sum game. I have consistently said it is near a zero-sum game. What winning are you seeing in the not rich? How do you look at all the evidence provided in this thread and not see that we are very close, to a 'win, lose' situation. In may ways we are in a 'win, lose situation.'

We have companies illegally fixing the prices of their employee salaries.
We have bankers destroying the economy then giving themselves massive million dollar bonuses.
We have companies illegally fixing the price of goods.

The rich are cheating, and the everyone else's well-being is getting negatively impacted by it.
Wealth concentration is inherent to capitalism.

- We have seen no growth in the income of non-rich for nearly 40 years.
- That wealth is often measured as declining
- Our political system is and economic controls are influence by money, the laws of the economy are literally being purchased.
- Human well-being is in part directly tied to fairness, we care about it and when it isn't there we tend to get unhappy
- I had a whole list of links and articles relating to well-being decreasing as the discussion was talking about average utility, but that's not my point right now.

Please show me where the economic wins are for the not rich. Show me how you can justify calling the economy we have a "win, win" situation rather than a "win, break even" or "win, lose."

Again I'll state, that the gains from the rich are more than the growth in the money supply. This means someone has to lose.

This makes the game nearly zero-sum:
- there is growth added to the total utility of the economically
- average utility is going down
- all of the growth is seen at the top
- some gains from the top are taken from places other than the growth

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Thu Dec 11, 2014 10:23 pm UTC

mat.tia wrote:but it's a fact that capitalist countries are exploiting resources belonging to other countries. Human labour included.
Can't we re-cast that as "some countries have too much money"? Maybe the US should be made to give their resources (labor, raw materials, manufactured goods, gold) to the poor countries.

mat.tia wrote:There's several problems related to such an unequal distrubution we spoke about; not only the power concentration.
Yes, this is correct. Each should be lain out separately to be discussed. They may have as a common factor that it relates to wealth, but that does not make wealth the root cause, nor does that mean confiscating their wealth is the solution.

mat.tia wrote:...in an ideal world money is not equivalent to power
That is not even sensible. Economic power is a very real thing. Unless you mean something like "in an ideal world we don't even use money", which won't happen unless "in an ideal world, nobody will want anything, whether material, emotional, or abstract".

Whenever there is trade, there will be somebody with an upper hand. That's what happens during barganing. I'm willing to give up seven apples, you're willing to take three. Why should I tell you I'm willing to give up seven if I can get what I want from you for three? Why should you tell me you only have to have three, if you stand a chance to get seven? The best bargainer wins, irrespective of whether it's better for society that you have apples at all. Because neither of us is making this trade for the benefit of society.

That is the fundamental issue. Do you have a way to fix this, without introducing something equally bad?

mat.tia wrote:Otherwise, you need to take for granted that, above a certain unquantifiable threshold (which I argue is relative to the total amount of wealth available), money gives you too much power. Legally.
Fine. But the power that you see associated with personal money rarely comes from that money. The best example of it that I can think of is Michael Bloomberg.
Spoiler:
According to the wiki, he got a $10 million severance package from Salomon Brothers (where he headed equity trading), used it to build a company that delivered high quality business information quickly to clients, hooked Merrill Lynch into it, and got them to invest another $30 million in it.

He built this into a huge company, netting him $33 billion dollars.

He ran for mayor of NYC largely on his own dime. Being rich he could do this and it could be argued that he purchased his office. But being largely a self-made rich person, it also demonstrates some of the traits necessary for being a good mayor, so it's not clear that this is a bad thing - that it is an example of money giving inappropriate people power.

There is a two term limit. He managed to get the laws changed, and ran for and got a third term. This is problematic in my eyes, but by then he was already popular enough to pull it off.

I won't judge whether he was a good mayor or a bad one; it's in many ways irrelevant. In any case he was a popular enough one.
By and large however, the power that super-rich have does not come from their personal wealth, but from the position they hold; the helm of some other organization that controls lots of money. So, limitations on personal wealth won't really address the actual issue you have with the super-rich. (At least not this one).

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby mat.tia » Thu Dec 11, 2014 10:44 pm UTC

ucim wrote:

I know the definition of this one: Trolling! Do I get to become super-rich?

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Thu Dec 11, 2014 10:55 pm UTC

mat.tia wrote:
ucim wrote:
I know the definition of this one: Trolling!

Huh? How so?

mat.tia wrote:Do I get to become super-rich?
Sure. Do you have any money? :)

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby KrytenKoro » Fri Dec 12, 2014 12:30 am UTC

ucim wrote:Can't we re-cast that as "some countries have too much money"? Maybe the US should be made to give their resources (labor, raw materials, manufactured goods, gold) to the poor countries.

Like...we already do, you mean?
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby sardia » Fri Dec 12, 2014 1:05 am UTC

http://www.nytimes.com/2014/12/12/upsho ... 0002&abg=0
"Many men, in particular, have decided that low-wage work will not improve their lives, in part because deep changes in American society have made it easier for them to live without working. These changes include the availability of federal disability benefits; the decline of marriage, which means fewer men are providing for children; and the rise of the Internet, which has reduced the isolation of unemployment.

At the same time, it has become harder for men to find higher-paying jobs. Foreign competition and technological advances have eliminated many of the jobs where high-school graduates like Mr. Walsh once could earn $40 an hour, or more. The poll found that 85 percent of prime-age men without jobs do not have bachelor’s degrees. And 34 percent said they had criminal records, making it hard to find any work."

This is what the bottom 20% looks like, without changes to our social safety nets. This of course assumes the conservatives don't gut the system, or the Democrats somehow find the votes to transfer more funds to the poor.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Fri Dec 12, 2014 3:47 am UTC

KrytenKoro wrote:Like...we already do, you mean?
We choose to on a small scale. Maybe we should be made to, on a large scale. Doesn't the US have too much money, and too much power, in a similar way as the ultrarich folk?

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby elasto » Fri Dec 12, 2014 8:37 am UTC

That's not a great parallel because we don't have a world government: Above the country level it's basically anarchy: There is no benevolent agent who can unilaterally impose a world-wide increase in utility - unlike within a country with a single government with a monopoly on power.

The nearest equivalent to an 'overly influential rich person' once you get to the country level is the large transnational corporations who do have too much money and power - and even Western governments are actively look for ways to reign them in. Look at European court rulings or the tax havens being forced to open their books or the UK's new 'Google tax'.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby leady » Fri Dec 12, 2014 11:37 am UTC

mat.tia wrote:False. They are moving to capitalist countries for two main reasons: war and poverty. Both of them are usually exported by capitalistic nations. Because, you can say that economy is not a zero sum game and that the rich are making everyone richer, but it's a fact that capitalist countries are exploiting resources belonging to other countries. Human labour included.


Neither poverty or war is exported, if anything they are the natural state of man. Even in your view of the world capitalist countries don't exploit resources belonging to other countries. Like or loath sweat shops, mega mines and oil exploitation, they are all massively better than the alternatives (for some reason people have a very romantisised view of subsidence existance...)

mat.tia wrote:I don't care about getting richer, nor others getting poorer. I care about a healthy society that is devoted to develop and incentive the finest human activities and qualities. I think a wealth distribution of this kind gets in the way of that.


If you think that, then you have a mechanism in mind I suspect for how its causing an issue? Given most wealth is tied up in assets and the net income on assets is broadly about 6% over the long term then by my half assed calculations 97%+ of say corporate spending is cycled regardless of asset ownership. Maybe land or non-perishable assets are more warped, but...

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby Tyndmyr » Fri Dec 12, 2014 4:08 pm UTC

mat.tia wrote:
ucim wrote:I am not (for example) defending such a society (as if that kind of society were better than others), even though some jump on me as if I were. Rather, I am defending against what I think is a misplaced focus on cause.

The statement "(super-)rich people have too much money" reads as if that were a problem in and of itself, a statement with which I disagree. I look further.

"(Super-)rich people have too much power (which their money lets them purchase)" is closer. But it can be generalized: "{These people} have too much power", which seems to be the actual problem some have with the super-rich.

And it is the attainment of power that should be the focus... how money is turned into power. Because sometimes it's appropriate, and sometimes not.

There's several problems related to such an unequal distrubution we spoke about; not only the power concentration. But regarding that one, of course in an ideal world money is not equivalent to power. Do you want to discuss how to get to such a world? Great!
Otherwise, you need to take for granted that, above a certain unquantifiable threshold (which I argue is relative to the total amount of wealth available), money gives you too much power. Legally.


Whenever I hear words like "unquantifiable" in this sort of context, it seems clear that the person is talking belief, not economics. An 'unquantifiable' amount of too much wealth giving too much power that needs to be "taken for granted" seems entirely arbitrary. How much is too much?

Also, money will always grant power. That is in it's nature. You pay someone money to do something you do not wish to do yourself. That is a form of power. If money was entirely disconnected from power, it would no longer be money.

Tyndmyr wrote:Capitalism is improving the lives of the poor. That's why the whole immigration issue exists. They want to upgrade to what we have.

False. They are moving to capitalist countries for two main reasons: war and poverty. Both of them are usually exported by capitalistic nations. Because, you can say that economy is not a zero sum game and that the rich are making everyone richer, but it's a fact that capitalist countries are exploiting resources belonging to other countries. Human labour included.

Many studies show a reverse direct proportion between the level of average personal wealth of a country and self reported happiness of its citizens. I have one by the Economist on paper, if you want me I'll take a picture of it. [edit: looking for the article on the internet brought me to various studies with contradictory results. On average the correlation seems very weak, slightly but not regularly skewed towards richer countries]


The rise of capitalism has coincided with reductions in war and poverty. Democratic, capitalistic countries, as a rule, don't generally go to war with each other. Europe is a particularly good example, as it's lengthy history of internal battles is being replaced by advanced, fairly capitalistic countries. Sure, capitalism comes in varying degrees, and there's room for improvement in many places, but it should be blatantly obvious that capitalism didn't invent war or poverty.

Tyndmyr wrote:And, if you don't care about consuming more, why do you care about getting richer, or others getting richer?
I don't care about getting richer, nor others getting poorer. I care about a healthy society that is devoted to develop and incentive the finest human activities and qualities. I think a wealth distribution of this kind gets in the way of that.


Then you DO care about getting richer or others getting poorer. Because that's all tied up in that.

About humans being seen as resources, your argument is preposterous. You said "we've just been trained to consider human labor different than resources". I criticized your argument for two reasons:
1) philosophically speaking, it is just based on nothing. As I said, the terms "human resources" and "consumer" are very recent. On the contrary, the term "soul" is quite ancient. Wonder why?
In whole history most of the cultures thought humans had souls. This makes them different from tools.
Of course people have used each other all the time. But it is false to say that nowadays common habit of thinking of people as any other resource has always existed. Tons of books have been written about the role of humanity in history and the recent shift of attention from human life to Techne (and hence economy).
2) logically speaking, it is nonsense. If your goal is to improve human life, to consider human labor as a resource as any other is nonsense, since it is an aspect of the human life you want to improve.


The specific terms may be recent. However, do not confuse labels with underlying beliefs.

You can wish to improve human life while still considering human labor a resource. Why would this be nonsense? It's no different than wishing to improve your home, while still considering your home as a valuable resource.

Tyndmyr wrote:What you are quote sniping simply follows a fairly standard example of how trade and specialization enable a net economic gain. It would be difficult to take any economics course without encountering this idea. Simply dismissing basic concepts with talk of goals is ridiculous.

So you're saying I'm ignorant and I should stay out of the argument. True, I am ignorant. I made questions, many. Some, were addressed. Others, not. Amongst these was the definition of wealth, which is in the title of the topic; you have at first agreed on the definition I gave. Then decided to change your mind, and adopted someone else's.
I criticized that other definition attempt using the argument of advertisement. You haven't replied in merit and haven't proposed a definition of "wealth" yet.


This is not a definitional fight, or at least, it wasn't. I'm also not saying you should stay out of the argument. But I *am* saying that your quote sniping was pretty obviously trying to avoid talking about anything of merit. I'm also saying that if you don't understand basic economic principles, simply denying their existance is not a particularly rational way to proceed. It's fine to propose an alternative system, but you do need some degree of understanding and evidence to do this plausibly.

Wealth, in an economic sense, is fairly well defined. It may also be used casually in other contexts, and that's fine, but just as you shouldn't judge scientific words by their colloquial usage, the same is true of economic ones. This being a forum and not a journal, formality tends to be low, but if you prefer a formal definition, wealth is the total market value of all assets owned by an entity, minus all debts owed by that entity. Sometimes, in informal speak, we may only talk about the former without discussing the latter or what not, but within economics, this isn't a source of contention by different schools of thought.

Money represents wealth, in any society that uses money. Sure, in real terms, there isn't a great deal of use for a piece of paper with a picture of a dead president on it, but money is a remarkably handy intermediary for dealing with wealth, so it's accurate enough to describe someone with buckets of money as wealthy in modern society, because usage of money is so universal. Sometimes the distinction between posession of capital and possession of goods is important, and sometimes it isn't. Thus, "wealth" may be used to describe different things in different contexts, but the ideas underlying this are pretty constant.

Zcorp wrote:
Tyndmyr wrote:Capitalism is improving the lives of the poor. That's why the whole immigration issue exists.

I don't understand how you think this is relevant.

Are you now arguing that the poor in America live great lives? That because America poor is better than Mexico poor there is no problem?


They live great lives relative to many foreigners, yes. This is relevant to claims about capitalism. This is not the same as saying there are no problems. Nobody is claiming that capitalism is perfect...we're merely pointing out that competing systems are much, much worse.

Now, within mostly-capitalistic systems, there is some variation, and if precision is required, we can further drill down into what causes success, and there's certainly room for discussion with that, etc, but we can rule out a number of approaches as having clearly failed in the real world.

Tyndmyr wrote:You don't think that wealth has anything to do with better lives? Really?

I didn't express myself clearly. What I meant is that if you want to talk about improving life in general, wealth has just a part in it. You cannot reduce quality of life to $. You just can't. So let us stick to a definition of wealth that is not "quality of life".


Ah. Generally quality of life is understood, in an economic context, to be about the portion of life that is material, just as "cost of living" generally refers to material cost, and not, say, emotional costs.

ucim wrote:
mat.tia wrote:but it's a fact that capitalist countries are exploiting resources belonging to other countries. Human labour included.
Can't we re-cast that as "some countries have too much money"? Maybe the US should be made to give their resources (labor, raw materials, manufactured goods, gold) to the poor countries.


If memory serves, making 34k a year suffices to put one in the top 1% of the world, income-wise. It is intriguing how the concern for economic equality magically stops at the border.

mat.tia wrote:
ucim wrote:

I know the definition of this one: Trolling! Do I get to become super-rich?


This is another really wierd quote-snipe. Did you mean to quote something else?

KrytenKoro wrote:
ucim wrote:Can't we re-cast that as "some countries have too much money"? Maybe the US should be made to give their resources (labor, raw materials, manufactured goods, gold) to the poor countries.

Like...we already do, you mean?
[/quote]

Foreign aid is a fairly small part of the US budget. It's more akin to charity from rich folks than to forced redistribution. The wealthy have always given out some degree of money, but the usual argument from those in favor of wealth redistribution is that it is far too small, and that much more must be required.
Last edited by Tyndmyr on Fri Dec 12, 2014 4:20 pm UTC, edited 1 time in total.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Fri Dec 12, 2014 4:13 pm UTC

Nitpicking, but it wasn't capitalism per se that ended most warfare but the stability of food supplies and the spread of birth control. War often happened because it was necessary; you don't have enough food to go around, someone WILL die, might as well be those assholes 3 villages over. You can argue that capitalism enabled this, but that was a side effect.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby sardia » Fri Dec 12, 2014 4:20 pm UTC

Someone brought up that inequality itself isn't bad, rather its a sign of something bad going on. Does that distinction matter? The closest I can think of is to not justify safety net programs by yelling inequality will be reduced. For example, social security is one of the largest sources of income transfers and the key to maintaining a middle class lifestyle. Its running out of money, so we should raise payroll taxes on the rich to maintain funding.
Why is the above a bad argument to reduce inequality?

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby Tyndmyr » Fri Dec 12, 2014 4:23 pm UTC

CorruptUser wrote:Nitpicking, but it wasn't capitalism per se that ended most warfare but the stability of food supplies and the spread of birth control. War often happened because it was necessary; you don't have enough food to go around, someone WILL die, might as well be those assholes 3 villages over. You can argue that capitalism enabled this, but that was a side effect.


Granted, certain areas of wealth had more dramatic effects than others, yeah. But...capitalism produces a great deal of wealth(per capita wealth and capitalistic/democratic countries match up pretty well). Side effects of wealth gain can be very important indeed. Plenty of farmers, etc only really wanted to be less poor, and better lives for themselves, sure. People are people, everybody tends to want that. Capitalism just happens to be good at channeling those desires into a useful direction.

sardia wrote:Someone brought up that inequality itself isn't bad, rather its a sign of something bad going on. Does that distinction matter? The closest I can think of is to not justify safety net programs by yelling inequality will be reduced. For example, social security is one of the largest sources of income transfers and the key to maintaining a middle class lifestyle. Its running out of money, so we should raise payroll taxes on the rich to maintain funding.
Why is the above a bad argument to reduce inequality?


I'd say the distinction does matter. Because viewing inequality as the root problem means you don't need to keep digging.

If the inequality IS merely a result of a deeper problem, then ignoring that problem and just slapping wealth distribution on top may not be a good solution.

As a (likely only partial) example, I'll toss out the welfare cliff as a potential underlying problem. Perverse incentives reduce motivation to work, and thus likely reduce overall economic recovery among the lower class. Obviously, this would contribute to income inequality.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Fri Dec 12, 2014 5:42 pm UTC

sardia wrote:Someone brought up that inequality itself isn't bad, rather its a sign of something bad going on. Does that distinction matter?
Yes, this distinction matters, at least if you want to solve a problem, rather than simply implement a policy you've alraeady decided on. This distinction helps you determine which policy is best to implement, or whether any policy at all is called for.

sardia wrote:Why is the [below] a bad argument to reduce inequality?
Because it's the wrong question. It actually illustrates the point. You've already decided that reducing inequality is the goal, but you haven't shown that inequality is the problem that needs to be solved. In your example:

sardia wrote:social security is one of the largest sources of income transfers and the key to maintaining a middle class lifestyle. Its running out of money, so we should raise payroll taxes on the rich to maintain funding.
... you state and/or assume givens that may not be agreed upon ("SS is the key to maintaining the middle class", and "the middle class needs to be maintained") You propose a method to keep SS funded and justify it for a reason (reducing inequality) that inherently assumes (without stating) something else that has not been agreed upon either ("reducing inequality is a Good Thing") but doesn't relate to the givens ("middle class is a Good Thing and needs our support").

So the argument does not hold together logically at all.

It relies on emotional triggers as opposed to actual good reasoning. To argue against it on its own terms, you'd need to argue against safety nets, or against equality, or against taxes... all of these arguments being toxic to the opponent but irrelevant to the actual issue in question, which was never really stated and is thus immune from question.

That's why.

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby sardia » Fri Dec 12, 2014 6:22 pm UTC

Tyndmyr, do you have any evidence that measures the economic magnitude if the welfare cliff?

Image
I can sorta see it, but what measurable effect does it have? I know the hypothesis behind poverty traps, but does it work?

Ucim, what Is s the purpose of social security? Does it have to be economic growth?

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Fri Dec 12, 2014 6:37 pm UTC

sardia wrote:Ucim, what Is s the purpose of social security? Does it have to be economic growth?
As I've been led to believe, Social Security exists as a mandatory retirement plan of last resort, bundled in with a little bit of insurance against related ills. It's a sort of forced savings account; your benefits depend in part on what you put in during your employment. There were probably hidden political motives behind its creation (does anything not have that?). It has the property of helping keep old folk out of the workplace, so young folk can get jobs. There are also laws that prevent old folk from working, for the same reason. That might have even been the initial motivation.

If people could be relied on to save, we probably wouldn't need Social Security.

I don't think it's purpose ever was economic growth, and if it were, it seems a poor way to accomplish it.

sardia wrote:I can sorta see [the welfare cliff], but what measurable effect does it have? I know the hypothesis behind poverty traps, but does it work?
To read the graph, "If you make {Household earnings}, the government will give you (up to) {Value of benefits}. Look at the slope of the line. Wherever that slope is less than -1 (45 degrees downward), it doesn't pay to work. The income you lose by not working is replaced in full by the government.

Now the axes are not drawn to the same scale, so you need to adjust the angle (on this graph it's not depicted at 45 degrees) but that's the idea. Between $0 and $45,000 income, the net value of working is very low because so much of the "lost" income is replaced by the government.

In fairness, this doesn't take taxes into account; even if there were no benefits, not all the dollars that are earned make it into your pocket. So, the cliff is not as sharp as it looks. But that's the idea.

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Fri Dec 12, 2014 8:00 pm UTC

The problem with that chart, aside from different scales on X and Y, is that household incomes are BEFORE tax rather than after.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby sardia » Fri Dec 12, 2014 10:29 pm UTC

Right, so the hypothesis Is stated. Now I'm asking for the effect size. What percentage of people stopped working, dollars in GDP or taxes wasted. Etc etc.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Fri Dec 12, 2014 10:55 pm UTC

sardia wrote:Right, so the [welfare cliff] hypothesis Is stated. Now I'm asking for the effect size. What percentage of people stopped working, dollars in GDP or taxes wasted. Etc etc.
That I couldn't tell you. But further, the effect isn't so much "people stopped working" but "people becoming dissuaded from working harder" and (more insidious) people passing this attitude on. It is (or could be) a lifestyle effect as well as a financial one, which has a tail as long as time.

Being as it involves a counterfactual, I'm not sure how that could be isolated and measured.

I suppose one way would be to calculate the actual salary one would need to earn in order to take home the amount of the usual salary for any given "step up" job, and then offer jobs in a controlled manner to people at that new, higher salary. Then compare the takers to the takers at the usual salary. More money almost certainly means more takers, but perhaps there's a threshold effect.

I think the first thing to do would be to figure out just what it is that should be measured, and what it's a proxy for, and whether or not it's a good proxy.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby LaserGuy » Sat Dec 13, 2014 4:07 am UTC

Tyndmyr wrote:I'd say the distinction does matter. Because viewing inequality as the root problem means you don't need to keep digging.

If the inequality IS merely a result of a deeper problem, then ignoring that problem and just slapping wealth distribution on top may not be a good solution.

As a (likely only partial) example, I'll toss out the welfare cliff as a potential underlying problem. Perverse incentives reduce motivation to work, and thus likely reduce overall economic recovery among the lower class. Obviously, this would contribute to income inequality.


I'd think that the fact that productivity gains and GDP growth aren't being translated into higher wages is the problem, and inequality is the symptom. If minimum wage had kept up with GDP growth since the 60s, it would be over $20 per hour. Wages are being massively depressed, resulting in the bottom 90% keeping far less of the money that they earn, relative to their productivity. (Minimum wage hasn't even kept up with inflation, in fact).

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby sardia » Sat Dec 13, 2014 4:37 am UTC

LaserGuy wrote:
Tyndmyr wrote:I'd say the distinction does matter. Because viewing inequality as the root problem means you don't need to keep digging.

If the inequality IS merely a result of a deeper problem, then ignoring that problem and just slapping wealth distribution on top may not be a good solution.

As a (likely only partial) example, I'll toss out the welfare cliff as a potential underlying problem. Perverse incentives reduce motivation to work, and thus likely reduce overall economic recovery among the lower class. Obviously, this would contribute to income inequality.


I'd think that the fact that productivity gains and GDP growth aren't being translated into higher wages is the problem, and inequality is the symptom. If minimum wage had kept up with GDP growth since the 60s, it would be over $20 per hour. Wages are being massively depressed, resulting in the bottom 90% keeping far less of the money that they earn, relative to their productivity. (Minimum wage hasn't even kept up with inflation, in fact).

My big problem with minimum wage is the fact that it isn't really the minimum wage. We pay for all these programs, that are all tied to you getting a (crappy) job that has no future. It's easier to just give them their government brand cheese and call it a day. Enough with all the hoops they have to jump through to get it.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Sat Dec 13, 2014 7:02 am UTC

LaserGuy wrote:I'd think that the fact that productivity gains and GDP growth aren't being translated into higher wages is the problem, and inequality is the symptom.
Wages are the well-earned rewards of labor. If I hire you for an hour and ask you to pick apples, seven quatloos are a good wage. (Why? We'll come back to that. For now, it's gotta be something, and that's what I'm calling it.) You pick for an hour, and I conveniently end up with seven bushels of apples.

Meanwhile, I invent, design, and build an apple picker. It makes apple picking easier - you just move this lever instead of having to climb trees. So, now I hire you for an hour to do this easier work. I still pay you seven quatloos, but I end up with thirty bushels of apples.

There is higher productivity, but your wages remain the same. The job is easier however, and you prefer it to hand-picking. You're willing to do it for only five quatloos, because you'd rather work for an hour and a half doing this easy work than to work your tail off (and end up with health problems) doing it the hard way. I'm amenable, and I hire you for an hour and a half, at five quatloos an hour. Now you end up with seven and a half quatloos; you go home later, but your back doesn't hurt and you're not tired. And I end up with forty-five bushels.

So... is there anything wrong with this picture? Should I be made to pay you more so that "productivity gains translate into higher wages"? What about my neighbor, who doesn't have this apple picker and still picks by hand? He's having a harder time finding apple pickers because they all want to work for me instead. Should I have to pay him some sort of compensation too, to make up for the drive, intelligence and work it took to make my apple picking machine, and his lack of it?

Because that is what you are saying is the problem, except on a larger scale, and a solution that is unfair on the small scale is suspect on the larger scale too.

Jose
Last edited by ucim on Sat Dec 13, 2014 7:09 am UTC, edited 1 time in total.
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby Thesh » Sat Dec 13, 2014 7:08 am UTC

And that's why all farmers should still make the same amount they did 100 years ago, because they have it easier today. I think that should be applied to all jobs, so that your wages cannot go up unless you are in a newly created field.
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby mat.tia » Sat Dec 13, 2014 2:36 pm UTC

ucim wrote:Wages are the well-earned rewards of labor. If I hire you for an hour and ask you to pick apples, seven quatloos are a good wage. (Why? We'll come back to that. For now, it's gotta be something, and that's what I'm calling it.) You pick for an hour, and I conveniently end up with seven bushels of apples.

Meanwhile, I invent, design, and build an apple picker. It makes apple picking easier - you just move this lever instead of having to climb trees. So, now I hire you for an hour to do this easier work. I still pay you seven quatloos, but I end up with thirty bushels of apples.

There is higher productivity, but your wages remain the same. The job is easier however, and you prefer it to hand-picking. You're willing to do it for only five quatloos, because you'd rather work for an hour and a half doing this easy work than to work your tail off (and end up with health problems) doing it the hard way. I'm amenable, and I hire you for an hour and a half, at five quatloos an hour. Now you end up with seven and a half quatloos; you go home later, but your back doesn't hurt and you're not tired. And I end up with forty-five bushels.

So... is there anything wrong with this picture? Should I be made to pay you more so that "productivity gains translate into higher wages"? What about my neighbor, who doesn't have this apple picker and still picks by hand? He's having a harder time finding apple pickers because they all want to work for me instead. Should I have to pay him some sort of compensation too, to make up for the drive, intelligence and work it took to make my apple picking machine, and his lack of it?

Because that is what you are saying is the problem, except on a larger scale, and a solution that is unfair on the small scale is suspect on the larger scale too.

You are talking of fairness when you didn't accept that word.
I had asked you what you think an ideal distribution should do.
The kind of distribution you illustrate has the only goal of rewarding the inventor of the apple-picking machine. (Assuming it was invented and built from scratch all by the same person using his own material).

If things were as you say, today we would be using electricity while working, but all money that its invention generated would be in the hands of the Edisons family.
And all of us would be extremely less wealthy, since today every employer uses electricity and so they would be paying their employees less compared to what they paid them to do the same job without electricy.
Same thing with all other inventions in human history.
I say this kind of re-distribution is nonsense for long term productivity. And is also "unfair". Inventors don't do all the work from zero by themselves; they happen to add "just enough" to ideas that were already circulating and are lucky that what they add is what is missing in order to have a final discovery/invention.
That is why many discoveries and inventions are made by different people roughly at the same time independently.

Tyndmyr wrote:if you prefer a formal definition, wealth is the total market value of all assets owned by an entity, minus all debts owed by that entity

Then please, explain me if you will (I'd be thankful) how this can be measured in absolute value. What is the unit of measurement? If it is, as I think, money (dollars, euros, yen or w/e currency) how is it not relative to current market size?

leady wrote:Neither poverty or war is exported, if anything they are the natural state of man.

Can you elaborate please?
leady wrote:Even in your view of the world capitalist countries don't exploit resources belonging to other countries. Like or loath sweat shops, mega mines and oil exploitation, they are all massively better than the alternatives (for some reason people have a very romantisised view of subsidence existance...)

I don't see the correlation between the conclusion "capitalist countries don't exploit resources belonging to other countries" and its justification " sweat shops, ...are all massively better than the alternatives". And what does "better" mean? What do you base your claim upon? Personal experience?


Tyndmyr, ucim, leady, jseah; what do you think about this inequality? I understand what you think about what many of us think about it. But you?
Is it ok? If so, why? Because it's "fair"? Because it's "healthy" for the economy? Or because we should just keep things as they are?


Other answers to Tyndmyr, spoilered because probably not relevant to conversation
Spoiler:
Tyndmyr wrote:Whenever I hear words like "unquantifiable" in this sort of context, it seems clear that the person is talking belief, not economics. An 'unquantifiable' amount of too much wealth giving too much power that needs to be "taken for granted" seems entirely arbitrary. How much is too much?

Can you tell a tadpole from a frog or do you need an arbitrary classification written in a book that says "Biology" in it to be confident about it?
I have my own opinions, luckily. Some of you guys seem to have strong faith though. Are you part of Block's Church of "Defending the Undefendable"?

[speaking of ideal worlds in which money is not equivalent to power] Also, money will always grant power. That is in it's nature. You pay someone money to do something you do not wish to do yourself. That is a form of power. If money was entirely disconnected from power, it would no longer be money.

I'm afraid when it comes to "ideal" things, the only thing that prevents something to be possible is the imagination of the thinker.

The rise of capitalism has coincided with reductions in war and poverty. Democratic, capitalistic countries, as a rule, don't generally go to war with each other. Europe is a particularly good example, as it's lengthy history of internal battles is being replaced by advanced, fairly capitalistic countries. Sure, capitalism comes in varying degrees, and there's room for improvement in many places, but it should be blatantly obvious that capitalism didn't invent war or poverty.

Can you show me some evidence of your claims? Can you also show me how you can confidently link the reductions of war and poverty solely to capitalism?
Can you show me where I said capitalism is the only cause of war and poverty?

About humans being seen as resource[...]

The specific terms may be recent. However, do not confuse labels with underlying beliefs.

You can wish to improve human life while still considering human labor a resource. Why would this be nonsense? It's no different than wishing to improve your home, while still considering your home as a valuable resource.

Most of modern philosphy/antropology is about this issue, you can go check something out if you're interested. I read mostly Italian material, so I can't point you to a specific piece of literature on this topic (unless you read Italian).
And if you want to make your house taller it makes no sense to take the bricks from your house.


This is not a definitional fight, or at least, it wasn't. I'm also not saying you should stay out of the argument. But I *am* saying that your quote sniping was pretty obviously trying to avoid talking about anything of merit. I'm also saying that if you don't understand basic economic principles, simply denying their existance is not a particularly rational way to proceed. It's fine to propose an alternative system, but you do need some degree of understanding and evidence to do this plausibly.

I don't know much, but I'd say I understand more than you think. And this is not -yet- a technical discussion. It could, and should turn into one if we agree on the goal and start talking about the means to get there. We don't seem to agree about the goal.

Money represents wealth, in any society that uses money. Sure, in real terms, there isn't a great deal of use for a piece of paper with a picture of a dead president on it, but money is a remarkably handy intermediary for dealing with wealth, so it's accurate enough to describe someone with buckets of money as wealthy in modern society, because usage of money is so universal. Sometimes the distinction between posession of capital and possession of goods is important, and sometimes it isn't. Thus, "wealth" may be used to describe different things in different contexts, but the ideas underlying this are pretty constant.

I understand that. But it is very different to speak of "proportion of market size" and "ability to satisfy needs/desires". We can use both meanings in different context, but it is important to fix which one we're using.

mat.tia wrote:
ucim wrote:

I know the definition of this one: Trolling! Do I get to become super-rich?

This is another really wierd quote-snipe. Did you mean to quote something else?

no. ucim put words in my mouth I never even thought of. That's trolling.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Sat Dec 13, 2014 3:21 pm UTC

Thesh wrote:And that's why all farmers should still make the same amount they did 100 years ago, because they have it easier today. I think that should be applied to all jobs, so that your wages cannot go up unless you are in a newly created field.


Or what we could do is make it easier for farmers to move into other fields, so that society needs to bribe them with better wages in order to stay as farmers. The problem I have with CEOs making a fortune is that they have done everything in their power to prevent competition. Historically this meant preventing women, non-Protestants, and black people from ever being allowed to prove their worth in lower management, let alone the upper echelons. I want the society where we can turn around and say to the CEOs "hey, why are we paying you 8 figs? We found a girl that's more competent than you and she'll do it for high 6 figs!". What I DON'T want is the society that simply turns around as says "hey, you make too much, we are taxing you back down to high 6 figs".

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby mat.tia » Sat Dec 13, 2014 3:52 pm UTC

CorruptUser, you say CEOs are doing everything in their power to prevent competition, and that you do not like it.
Than you have two options:
1) stand still and hope CEOs will suddenly change their attitude and start incentivate competition, or
2) reduce their power to prevent competition. Their power comes with their wealth and the context in which it resides: one that intrinsically grows large wealth and in which wealth = power.

If you decide to address point 2, you can:
2a) directly reduce their wealth
2b) regulate market to address wealth distribution so that it will tend to be more even
2c) regulate market and laws to limit CEOs decisional powers so that, despite their money, the have less power to limit competition
2d) revolutions of different sorts

[edit: tried to be clearer]

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby LaserGuy » Sat Dec 13, 2014 4:19 pm UTC

ucim wrote:
LaserGuy wrote:I'd think that the fact that productivity gains and GDP growth aren't being translated into higher wages is the problem, and inequality is the symptom.
Wages are the well-earned rewards of labor. If I hire you for an hour and ask you to pick apples, seven quatloos are a good wage. (Why? We'll come back to that. For now, it's gotta be something, and that's what I'm calling it.) You pick for an hour, and I conveniently end up with seven bushels of apples.

Meanwhile, I invent, design, and build an apple picker. It makes apple picking easier - you just move this lever instead of having to climb trees. So, now I hire you for an hour to do this easier work. I still pay you seven quatloos, but I end up with thirty bushels of apples.

There is higher productivity, but your wages remain the same. The job is easier however, and you prefer it to hand-picking. You're willing to do it for only five quatloos, because you'd rather work for an hour and a half doing this easy work than to work your tail off (and end up with health problems) doing it the hard way. I'm amenable, and I hire you for an hour and a half, at five quatloos an hour. Now you end up with seven and a half quatloos; you go home later, but your back doesn't hurt and you're not tired. And I end up with forty-five bushels.

So... is there anything wrong with this picture? Should I be made to pay you more so that "productivity gains translate into higher wages"? What about my neighbor, who doesn't have this apple picker and still picks by hand? He's having a harder time finding apple pickers because they all want to work for me instead. Should I have to pay him some sort of compensation too, to make up for the drive, intelligence and work it took to make my apple picking machine, and his lack of it?

Because that is what you are saying is the problem, except on a larger scale, and a solution that is unfair on the small scale is suspect on the larger scale too.

Jose


Sure, but the since the supply has gone up, the price per bushel of apples has now fallen by a factor of almost seven, so even though the worker is being paid the same, or even less, they make up the productivity gains by increased purchasing power. In a free market, your profits remain exactly the same in both scenarios.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Sat Dec 13, 2014 4:31 pm UTC

mat.tia wrote:no. ucim put words in my mouth I never even thought of. That's trolling.
Where? Which words? Your quote was empty.

mat.tia wrote:You are talking of fairness when you didn't accept that word.
I don't reject the word (or the concept). I merely hold that life is inherently unfair, and to be "more fair" to one group you have to be "less fair" to another. To ignore this when supporting one position or another is to be disingenuous. In these (simplified) examples, the unfairness to the other group is made explicit, for example, by introducing (perhaps) the idea that my inventing of a machine obligates me to feed those it replaces, and inviting explicit support of this idea.

mat.tia wrote:The kind of distribution you illustrate has the only goal of rewarding the inventor of the apple-picking machine. (Assuming it was invented and built from scratch all by the same person using his own material).
In this simplified scenario, yes. The inventor did it all himself, using only what is available to everyone else. (I am not even talking about patents; in this scenario nothing stops my neighbor from building his own machine).

mat.tia wrote:If things were as you say, today we would be using electricity while working, but all money that its invention generated would be in the hands of the Edisons family.
Only if electricity is patented (or secret), which is not part of my scenario. Also, the sellers of the electricity would find no market if the buyers found no net benefit. So, the price would come down to a point where each (buyer and seller) were happy. Now, if I'm happy buying at ten, and you're happy selling at four, a free and open market ought to find the "fairest" price, over the long run. But sometimes it's a buyer's market and sometimes it's a seller's market. That's unfair too.

Should unfairness always be eliminated?

mat.tia wrote:I had asked you what you think an ideal distribution should do.
I don't think this is a sensible question. A distribution is a result, not a goal. And an ideal distribution results from the discovery of a number that is greater than seven and less than five. But ok, I'll take a stab at it.

In an ideal distribution, people are rewarded for their value to other people. Sometimes that reward is financial, sometimes not. But everyone would be happy with the result, and nobody would feel exploited. At the same time, those who are unable to be very valuable to other people would not be cast aside. They would be nurtured by society (which is made up of other people), so that they could become valuable to other people. As a result of this ideal distribution, everyone would be encouraged to become valuable to (at least some) other people, and would be able to grow unfettered in that direction. At the same time, those with drive and ambition, who actually become very valuable to other people (indirectly, through scientific discoveries, commerce, invention, whatever) would be richly rewarded for this.

"valuable to other people" is my (generalized) take on "productive member of society", because it includes even the idea of something like "valuable in and of themselves" (friends, housewives, children, volunteers, and others who add color to life without necessarily drawing direct financial reward for it).

"unable to be valuable..." is my generalized take on "drain on society". One can't (without offense) list examples, but that should not be necessary. It should be noted that some that might fall into this category also fall into the other.

"nurtured by society" includes things like education, rehabilitation, treatment, etc.

This situation however is not stable unless you can also change people's overall nature. That's the issue I take with all of this. You can posit an ideal (of any sort), but this usually requires ideal people. Ain't gonna happen.

Real people have built-in wants, needs, and tendencies, some of which are not very nice. The ideal system uses these to advantage to create a halfway decent distribution. But with real people, I don't see how an ideal system will create an ideal distribution (if that can even be defined sensibly), without creating other far-from-ideal conditions. Because an economic distribution is merely one result of the way people interact.

mat.tia wrote:[(responding to CorruptUser)] If you decide to address point 2, you can:
2a) directly reduce their wealth
2b) regulate market to address wealth distribution so that it will tend to be more even
2c) regulate market and laws to limit CEOs decisional powers so that, despite their money, the have less power to limit competition
2d) revolutions of different sorts
Of these,

2c) is the route I'd pick, because it directly addresses the issue.

2a) is ethically unjustified.
2b) addresses the wrong thing in the same way bussing to integrate schools does.
2d) will happen by itself if things go too far, and it's messy.

Now 2c) suffers from the fact that the source of a CEO's market power is not usually his or her personal wealth. It is a direct result of their control of the company, and of the company's wealth. If you reduce their control of the company, then you risk the company's health (or at least its right to decide on its health). This might be justified, but might not be the best way to accomplish the goal.

I'd propose 2e (a variant on 2c) - at a certain point, when the company's size and structure start passing its risks and externalizing its costs onto the public, then that same public should start to have a say in how the company is run, or have an apporpriate share in the company's gains and wealth, based on the idea that it's sneakily being taken from the public in the first place.

CorruptUser wrote:I want the society where we can turn around and say to the CEOs "hey, why are we paying you 8 figs? We found a girl that's more competent than you and she'll do it for high 6 figs!". What I DON'T want is the society that simply turns around as says "hey, you make too much, we are taxing you back down to high 6 figs".

Yes.

But this requires an attitude change in the boardroom. It's not so easy to impose from the outside.

LaserGuy wrote:Sure, but the since the supply has gone up, the price per bushel of apples has now fallen by a factor of almost seven, so even though the worker is being paid the same, or even less, they make up the productivity gains by increased purchasing power. In a free market, your profits remain exactly the same in both scenarios.
Well, the price will certainly fall, but maybe not by a factor of seven. At least not right away. (cue the story of floppy disks) Depends on how saturated the market for these apples are. My profits will not go up by a factor of seven of course, but I expect they will rise. At the very least, I could pick fewer apples and use the time saved to make and sell pies. Which may even boost the market for apples. With first-mover advantage, I could also start some apple fairs to get people more interested in apples and pies and aprons and hogs and whatever else I can think of. So no, there certainly will be pressure on profits, but not so much, so fast.

And in any case, it would be a net gain for all.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Sat Dec 13, 2014 4:34 pm UTC

mat.tia wrote:If you decide to address point 2, you can:
2a) directly reduce their wealth
2b) regulate market to address wealth distribution so that it will tend to be more even
2c) regulate market and laws to limit CEOs decisional powers so that, despite their money, the have less power to limit competition
2d) revolutions of different sorts


Umm, no.

1) All 501(c) organizations may NOT pay their employees more than the President. Don't like it? Lose the tax exempt status. Similarly, a person can't work 10 jobs for different 501(c)s as a "consultant" to get around this. If you are running a charity (*cough*united way*cough*) you shouldn't pay anyone 7 figures.
2) NO organization may donate money to a political campaign unless it was specifically founded to do so, and if it is it must disclose every person and the donation they made, and American citizens only. Sorry, corporations are only people when Ronald McDonald has to sign up for the draft.
3) Make it easier to form a union. Yes, I generally hate unions, but we went too far in the other direction.
4) Ban hired protesters. Yeah, that's a thing; you can pay people to protest for you. In my city at the moment, you can go downtown and see two people holding a sign in front of the Humana building. Those people are paid by a construction guild to stand there because the guild couldn't be assed to do it themselves. They are upset that Humana hired someone else, which to me is the equivalent of Toyota hiring a bunch of people to protest in front of your house because you bought a Ford. Sorry, grassroots campaigns ONLY.
5) About 2/3 the shit the Occupyers wanted, oddly enough. Get the money out of politics!

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby Lucrece » Sat Dec 13, 2014 5:09 pm UTC

Was meritocracy ever a thing? I don't think there's ever been a time realistically where interpersonal relationships don't overcome meritocratic choices. A lot of jobs also involve "vouching for", which is a fancy word for "is this your friend/family". Having experienced both jobs in healthcare/videogaming industry, it's been pretty obvious to me that getting into the higher positions, especially for the latter, involves the luck in timing/meeting the right person under the right circumstances, but that also the circle you move in involves someone who can lift you up from a lower position. There's a surplus of talented people already, and it will only get worse as more people get specialized upper tier degrees and experience in related programs.*

There's also the issue of the rate of skill acquisition. A person who manages to make it into the industry as a protege of someone higher up will accumulate and amount of experience and set of skills much faster than the guy who had to go through some general education program and make his way through the large pool of entry-level jobs because he didn't know the right person. There's never been an "even footing" in levels of competition for job placement. Wealth seems to be largely inherited. Look at PhD's and MCAT scores and which people are making it into the higher tier business management programs in upper tier universities. If you want the extreme, you may even look at the publishing and entertainment industry.

*For instance, the average wait time for getting employed in the hospital system in Florida was over a year after your application is submitted. Because I happened to be connected to someone who was in an administrative position from a former job, I made it in in less than 2 months. I'm not going to sit here and pretend like there isn't a vast amount of similarly qualified people. And I'm willing to bet it unfortunately works like that in many other places.
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby Thesh » Sat Dec 13, 2014 6:11 pm UTC

CorruptUser wrote:
Thesh wrote:And that's why all farmers should still make the same amount they did 100 years ago, because they have it easier today. I think that should be applied to all jobs, so that your wages cannot go up unless you are in a newly created field.


Or what we could do is make it easier for farmers to move into other fields, so that society needs to bribe them with better wages in order to stay as farmers.


So we should have absolutely no farmers? Or just a handful of farmers that all make 1910 wages?
Summum ius, summa iniuria.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Sat Dec 13, 2014 7:41 pm UTC

Thesh wrote:
CorruptUser wrote:
Thesh wrote:And that's why all farmers should still make the same amount they did 100 years ago, because they have it easier today. I think that should be applied to all jobs, so that your wages cannot go up unless you are in a newly created field.


Or what we could do is make it easier for farmers to move into other fields, so that society needs to bribe them with better wages in order to stay as farmers.


So we should have absolutely no farmers? Or just a handful of farmers that all make 1910 wages?


No, they should have enough opportunities available that if society isn't willing to pay a decent wage then enough leave for other jobs until the wage rises. And you know what a farmer is these days? An asshole in a suit. "Farmers" are the guys that own the thousand plus acre farms; very little of your food actually comes from those rustic family farms with the squeaky windmills and the father and son getting up in the morning to milk the cows. No, your food comes from what are effectively plantations. Yes, with borderline slave labor. What we are concerned with are the farmhands, the poor schlubs that actually pick your crops for minimum wage. Most have no education, and the system is such that they never had a chance to start with. Cracked has an interesting article on the matter. The solution is to make it easier for them to get out of crop-picking, so that if society wants its hand-picked apples they have to pay $15/hr or the people will do other work instead.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby jseah » Sat Dec 13, 2014 7:47 pm UTC

mat.tia wrote:Tyndmyr, ucim, leady, jseah; what do you think about this inequality? I understand what you think about what many of us think about it. But you?
Is it ok? If so, why? Because it's "fair"? Because it's "healthy" for the economy? Or because we should just keep things as they are?

I'd say it's fair except for profits gained due to uncompetitive practices. (and other forms of 'cheating')

Essentially, if you worked fairly and competed on a free market, and somehow managed to end up with much more money than everyone else, then I'll happily let you keep it.
Manipulate the laws (which I think should be chosen based on agreed-upon principles, and ideally not buyable), exert monopoly power, fraud, etc. and I'll just as happily confiscate their money and send them to jail.

EDIT: corrected typo (unfair -> fair)
Last edited by jseah on Sun Dec 14, 2014 1:54 pm UTC, edited 1 time in total.
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Sat Dec 13, 2014 8:00 pm UTC

Jseah, I'll agree with that, so long as society ALSO works to make things more competitive in cases when even an unadultered free market fails (i.e., most cases).

Ironically, economically I agree with nearly everything Keynes said; Capitalism is useful but needs a HUGE amount of things to protect it from itself. People forget that Keynes was vehemently anti-socialist. Keynes' economics is ironically different from Keynesian economics, and in further irony the greatest Keynesian economist was Milton Friedman. Also people tend to forget that Marx hated it when companies actually took care of their workers because it reduced support for his One True Religion.

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby ucim » Sat Dec 13, 2014 11:01 pm UTC

Lucerne wrote:A lot of jobs also involve "vouching for", which is a fancy word for "is this your friend/family".
Or, "Is this person really as good/reliable/trustworthy as they look on paper? Because I don't really want to take a risk on an unknown." The latter part won't go away, because there's more to a job than just doing the job.

jseah wrote:Essentially, if you worked fairly and competed on a free market, and somehow managed to end up with much more money than everyone else, then I'll happily let you keep it.
Manipulate the laws (which I think should be chosen based on agreed-upon principles, and ideally not buyable), exert monopoly power, fraud, etc. and I'll just as happily confiscate their money and send them to jail.
CorruptUser wrote:Jseah, I'll agree with that, so long as society ALSO works to make things more competitive in cases when even an unadultered free market fails (i.e., most cases).
I'll get on board with this too (except I don't agree that the free market fails in most cases). The free market has the advantage of working with rather than against people's faults while building a good economic system, but like unrestricted {anything else}, it will run away with itself, to society's detriment, unless reined in where necessary. The trick is figuring out where, why, and how to do this without mucking up the good points of the free market.

Jose
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby sardia » Sun Dec 14, 2014 5:01 am UTC

http://www.washingtonpost.com/business/ ... story.html
Let's change our perspective a bit. Instead of assuming we are on the cutting edge of free market principles in the US, let's think of it another way.

"It’s not unions or regulations or taxes or trade and immigrant barriers that have brought us “secular stagnation,” as the economists now call it. It’s the profoundly unimaginative, herd-like behavior of corporate executives and directors, cheered on by their short-sighted investors on Wall Street. And as long as profits and share prices remain at record levels, they don’t see any reason to change. "

Why is it that we value driving down wages by competing on price, why aren't companies demanding the most value out of the market by competing on quality?

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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby jseah » Sun Dec 14, 2014 5:08 am UTC

CorruptUser wrote:Jseah, I'll agree with that, so long as society ALSO works to make things more competitive in cases when even an unadultered free market fails (i.e., most cases).
I suppose we agree in principle. We probably disagree on how often market failure occurs though.

I do support regulation when it corrects for market failure, better yet when it uses a market mechanism. An ideal case, carbon credits, as long as assessing pollution levels is transparent and doesn't cost too much.
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Re: Top 0.1% to pass bottom 90% of Americans in combined wea

Postby CorruptUser » Sun Dec 14, 2014 5:15 am UTC

Because with all the misinformation out there today, people don't know that product A really is better than product B. But they know B is cheaper. If there was a popular unbiased organization that have reviews, maybe...


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