This is the same argument that has been around for decades - the debate over whether Bill Gates and the Gates Foundation were an agent for good or an agent for helping Bill Gates sleep at night was a huge thing when I was in graduate school.
The difference is the out-in-the-open, stark, startling, and seemingly completely baked in income inequality. I think people outside of academia are finally talking about the morality of a billionaire's mere existence.
> the debate over whether Bill Gates and the Gates Foundation were an agent for good or an agent for helping Bill Gates sleep at night was a huge thing when I was in graduate school.
Having worked with multiple researchers who received grants from the Gates foundation for noble projects such as abolishing famine in Nicaragua and improving food security across central America, the amount of wasted money opened my eyes to the shallowness of their attempts to fix the world.
Care to expound upon this? It seems natural to me that something fighting against market failures would do things that would be financially irrational.
They spend a few thousand bucks conducting the experiments and collecting samples in those countries and then pay hundreds of thousands of dollars to gene sequencing companies. They get a spreadsheet in return that no one knows how to read or that has glaring discrepancies. I had to explain to 3 biogists that even though their PCA plot looks decent, a total explained variance of like 10% is not much to brag about. They had grants in the millions of dollars...
I'm confused. How could the argument about Gates' philanthropic motives been obvious for decades but those about economic inequality not been simultaneously obvious?
It's all one in the same problem. Philanthropy comes from wealth accumulation.
Therefore, it's not a real problem that Jeff Bezos owns 10% of Amazon. You wouldn't be any better off if he owned 9% or worse off if he owned 11% instead. It's a wedge issue.
If half of Jeff's shares were transferred to a non-profit organization that assists homeless people, would that make a physical difference in the world, or would it have no effect?
Right. It's much more of a problem that his employees are getting less value than they create for the company, and he is taking a lot of the difference. Since all billionaires have made their fortunes this way (or inheriting from someone who did), billionaires should not exist.
P.S. He owns 11.1% and had more before his divorce.
People often like to say that economy is not a zero sum game. But reality is that economy is not a game and, arguably, can be better modeled as a set of games, some of which are zero sum.
Academically, this might be true, but in the real world, wealth (like most scarce things: high-quality partners, precious metals, Michelin stars) tends to be zero sum.
I strongly disagree. In the real world, wealth is very much not zero sum.
Look around where you live, at the things that you value. How many of them were created with human effort, versus just existed in nature? Look at everything from computer you're typing on to the chair that you're sitting in to the roof over your head. EVERYTHING that was created with human effort is an example of wealth creation.
> EVERYTHING that was created with human effort is an example of wealth creation.
Without dismissing your point, I would strongly push back against effort being synonymous with wealth creation. Having grown up in post-Communist Eastern Europe, there was no virtually correlation between the two.
Excellent point. The wealth created is not strongly correlated with the effort put out. And we've all gotten wealthier as we've moved from high effort low return activities (eg sowing fields by hand) to low effort high return activities (eg computer programming).
Asia is a growing economy. I have no trouble believing that the tide is rising and the boats are floating in Asia.
In the United States, it's a different story. The tide is rising, but most boats have not been rising with the tides for about 40 years, and that's troubling.
The figure you linked does not indicate adjustment for inflation and does not segment expenditures by wealth, which is important, because the US economy as a whole is growing, but more than 100% of the growth is flowing to the top. The rich get richer, the poor (and middle class) get poorer. You have to segment by income to see this trend.
Wages are a bad metric because they exclude various non-wage compensation, tax transfers, etc. Consumption is a more direct measurement of whether things are getting better. It’s also better because it naturally excludes the super wealthy that making a bunch of paper income from the growth of equity value, but it actually consuming proportionally to that increased wealth. The idea being that I don’t really care about how much Bezos’s stock is worth except insofar as it impairs my own ability to buy stuff.
Inflation adjustments are tricky because it’s not really obvious how to measure inflation. But even adjusted for CPI inflation personal consumption expenditures have been steadily increasing in the 20th century: https://alfred.stlouisfed.org/series?seid=A794RX0Q048SBEA
Yeah, if you average the rich and poor together, they're getting richer! But the poor are still getting poorer. Averages hide disparities. We've been over this!
Tangent 1: Placeholder: I don't agree that consumption metrics are better.
Tangent 2: Rich people do consume (colloquially speaking) proportionally to their increased wealth, but after sating their material desires they turn to financial assets: dibs on passive income and future growth. More for them does mean less for everyone else. Both in the first-order sense of owning more shares and in the second-order sense of being on the winning side of prevailing trends in globalization, automation, tax law, and corruption.
You mean the quackery of Benjamin Franklin, Adam Smith, Ricardo and so on?
Someone should tell the record companies who say when you pirate a song, you're stealing from the artist who will not be properly compensated for the time they labored to write and record that song. I see corporate spokesmen expounding the labor theory of value all the time.
Yes, I meant the quackery of those you listed. Isaac Newton had a very distinguished mind, but was a proponent of young earth creationism; being right about one thing does not make you right about all things, and so it goes with Franklin, Smith, Ricardo et al.
As far as LTV is concerned, we know it to be a flawed theory today because we understand the time value of money. LTV will hold in the long run with constant returns to scale. Without constant returns to scale, only the marginal consumer matters. In simpler terms, demand will affect price, not just supply. Now, if we make the errant assumption that the supply curve is completely flat in the long run, then LTV does in fact hold. That is, the LTV is not a terrible description of economic reality, as long as you note that a) an isomorphic argument can be made for “the land theory of value” or “capital theory of value”, so labor is in no way special, and b) LTV can only apply for goods with flat long-run supply curves. In any case, there’s a reason the early great economists used it! Smith, Ricardo, and others were not all idiots. However, today, we know better and it flies in the face of modern science and understanding to promote its use.
Actually I suspect there may be a connection between the currency the economy uses to divvy up scarce resources and whether wealth is zero sum. If wealth were tied explicitly to the amount of gold humanity had extracted from the earth then the sum total of both are assumed equal. In that case, wealth definitely appears to be zero sum. It could even become negative sum if some quantity of gold is being made useless or unavailable. If currency is not tied directly to some hard-finite asset like how ever much gold has been pulled out of the ground then maybe wealth can be positive sum.
Wealth doesn't depend solely on currency; the value of people's other assets is very important. Reliable cars, comfortable houses, and amazing electronics all contribute to our material wealth.
I think he means that even if you believe that power is zero sum (debatable) the system in which that power extends is not. E.g. technological advancement can shift power away from violent storms, earthquakes, viruses, etc and into humanities hands. Thus I think it's pretty clear that 'power among humanity' would not be zero sum
Isn't it really? Given that wealth is the amount of resources you can command, and resources are finite, doesn't increasing your wealth decrease everyone else's? It's why printing money reduces the value of everyone else's money and gives it to you.
We are able to use existing resources more and more efficiently. This is why the global wealth per person is higher than it was in say Roman times, despite the global population being orders of magnitudes higher
But we don't value things solely based on their natural resource composition; we pay far more for "labor" and other intangibles.
As a result of the above, the value of a natural resource changes over time. For example, natural resources used in electronics and batteries are relatively more expensive now than they were 100 years ago.
So, you can be technically correct by saying that wealth is zero-sum, but that's pretty much the same thing as saying "the world's 'wealth' traded for natural resources sums up to 100% of all natural resources"
yet the book doesn't feed or cloth anyone. This is generally done by the sun (and stored energy from it in the form of many fossil fuels). Also, for a finite population, all the other books can not be consumed anymore. So yes, it is a zero-sum game.
The amount of resources aren’t constant, and how much that is created depends on the wealth distribution. Too little wealth concentration and there won’t be built any factories. Too much wealth concentration and too few can buy what the factories produce.
You might think about certain natural resources, such as minerals and oil as the only resources. But some resources grows, like trees for building material, and those depend on how many trees that we decide to plant. And other resources, like available teachers or programmers depend on how many we have taught and how much money we are willing to pay them.
There's still only so many trees that we can have on earth at once, as past a certain point, some trees would have to die in order to either have physical space or nutrients to grow new ones. Which would be zero sum...
It's the same with everything. When you're not at your limits of your ecosystem - things aren't zero sum. However once you do hit your limits, things become zero sum.
You even see this with businesses. Industries go through a growth phase. In the startup-growth-adoption phase, all businesses in that industry can grow. However, once market matures and reaches saturation, businesses struggle to grow or change. The only significant way mature businesses can grow larger at that point, is via mergers and acquisitions of other businesses.
Increased productivity means that we can produce more with less (usually labour, but also energy or natural resources). That a market reaches saturation usually means that the demand is met. It is rare that it means that not more can be produced.
>That a market reaches saturation usually means that the demand is met
A limit is a limit, doesn't matter if that's a demand limit, or a production limit, or a resource limit. The effect is still the same. Being under limits, makes things zero sum. If those limits were suddenly removed or increased temporarily, things would return to not being zero sum - at least until you hit another limit.
>It is rare that it means that not more can be produced.
In practicality sure. I'm sure we could make more basketballs than we do now. But physically speaking, you'd eventually hit limits. The earth is not infinite... we certainly could not make more basketballs than there is mass of earth itself. At which point we would either have to make new basketballs out of old basketballs, (zero sum), or raise our limits (mine matter out of other celestial bodies).
> Being under limits, makes things zero sum. If those limits were suddenly removed or increased temporarily, things would return to not being zero sum
Why do you think so?
> In practicality sure.
And that is what matters? Why is it interesting that there is a theoretical limit on how many basketballs that is possible to produce with the resources available on Earth when no conceivable situation exists when that limit ever becomes relevant?
I'm not sure under which rock you are living, but we are hitting limits fast. Soil degradation, climate change, acidification of the seas or phosphate ressources. Probably you'll die before these limits hit us hard(est). But eventually they will hit us and these are very conceivable situations...
That's not a given. There are multiple historical periods where wealth was effectively zero-sum. These periods often aligned with strong income inequality and an inability for individuals to purchase productive assets e.g. Feudal Europe, and Tzarist Russia.
On an individual basis there are multiple portions of the economy for which wealth could be modeled or interpreted as a zero-sum game. Examples include landlord/renter relationships in high rent burden environments, or other segments where an individual is unlikely to ever be able to afford a "share of future economic growth" in order to fund retirement etc.
Lots of markets (most markets?) aren't growing at any particular moment. We should really figure out how to fix our system in the low-growth zero-sum regime because it's common and important.
If Jeff pays his workers more money, his wealth accumulation will be slower and after a while he will have less wealth than he would have had if he had paid his workers more.
Also, if Jeff's workers have more wealth, they don't have to spend a lot of their disposable income on paying student loans or mortgages, and they will have more money to buy more stuff.
Is this true? Amazon shares have had a sharp rise in the time since he raised many of their wages by 50% to $15 an hour.
There seems to be little correlation, much less causation, between the amount he pays his employees and the value of the firm in which he holds interest.
You seemed to not understand the relationship between income, spending, and wealth, so I gave a simple explanation. Of course the world is more complicated, and for example Henry Ford realised (at least according to the myth) that he had to pay his workers enough so they could buy his products, otherwise he wouldn't have enough market. But that doesn't change the fundamental relationships between income an wealth.
Popular myth. Ford paid his workers that amount to outcompete competitors, not because he was in the game of charity. It's the same with Bezos, hence why Amazon lobbies for a federal $15 minimum. Many businesses will be outcompeted by Amazon with a law like that.
Jeff Bezos wealth hasn't been realized yet though, it is a lottery ticket people would pay a lot of money for that might create that amount of wealth in the future. It is unclear how that value would change if you changed worker pay today since it isn't really related to how much profit Amazon can extract right now. If Jeff Bezos were to sell his shares of Amazon the money wouldn't come from the pockets of his workers but from the pockets of investors. Amazon hasn't generated over a trillion in profits.
Wealth isn't, but political influence seems to be. I'm all for the existence of billionaire, so long as they don't muddle up the lives of the little people. Unfortunately they've shown little restraint on that front.
That is mostly an American problem. The top 1% has much less influence in Europe. You should probably work at fixing your democracy first since it is the real issue here.
i tend to flag and move on, but i'm making an exception to note that simplistic, identity-based tropes like this are so damaging to real discussion and should be flagged and ignored because the post was not made in good faith (in short, it's a troll).
gdp (national wealth) is a made-up metric, it's aggregate, it's dynamic, incomplete relative to its stated rationale for existence, inapplicable to the discussion, and a whole host of other irrelevances to a real understanding of wealth and its distortions.
> the debate over whether Bill Gates and the Gates Foundation were an agent for good or an agent for helping Bill Gates sleep at night was a huge thing when I was in graduate school.
I know there are a whole host of issues, racial inequality, climate change, pollution, etc, which I consider to be 'one percenter problems' now. I'm just trying to save enough to retire one day and keep a roof over my family. Fixing global issues is a luxury. Maslow's hierarchy and all that...
That’s not the only issue, non-profits and foundations apply all kinds of political pressure in opaque ways. There are many non-profits funded by elites that operate to advance societal good superficially while pushing ulterior political motives.
For a concrete example, a tremendous amount of money has recently flowed into sex education advocacy, some of which doesn’t have donor names attached to it.
Organizations that aim to provide resources around things like consent and healthy sexual behavior find that courting this new money involves adopting an abstinence-only approach as a mandate. As a result, it’s hard to know if the organization you’re donating to is actually doing the advocacy work they used to advertise, and they’re not always inclined to be transparent around who calls the shots from a donor perspective.
We like to think that political money lives only in super PACs and lobbying efforts, but this isn’t the case, and in some ways this makes the non-profit situation even more insidious. To be clear, I’m not denigrating all non-profit work, there are just some major transparency issues that need to be addressed.
This comment hits on one particular issue of ulterior motives in the actions of a non-profit.
But more generally, there is a whitewashing going on. Look at the Sackler family, which for decades got to put their names on museums, hospitals, etc. they get to go around spreading a story about how good they are while rotting out communities with their dirty opioid pushing. They got called out, sure, but how many other Sacklers are out there with their reputations unburnished?
Racial inequality isn’t a one percenter problem if your child was Killed by the police. Pollution isn’t a one percenter problem if your kids all have asthma from inhaling coal fumes or have been drinking water with lead. I could go on.
These problems sound like they have nothing to do with wealthy people standing up for one cause or another. The issue is that the wealth is so often created or amplified by greedily outsourcing these problems to the powerless. The wealth begets more power, and institutions that launder the story of that wealth into a whitewashed canvas of do goodery.
I think OP is just talking about how only one-percenters have time/money to care and act on these issues. The rest of us are too busy running the rate race to lift our heads up and even notice what's going on in the world.
Look at how much more political activism there is in the US during the COVID crisis. People have more time since they're working from home, and they're able to actually participate for the first time in a long while. Imagine how many more people would be able to vote if election day was a national holiday. It's honestly criminal that it's not.
Nothing you cited are one percenter problem, they were branded as such to keep you from emotionally involved, which in turn might give you the mental strength to push for the right things to happen.
Any of these problems, can directly affect your children.
Let me tell you one example, my parents generation suffered much higher cancer rate than normal. That's caused by 40 years of rapid industrialization in China.
Think about it, these issues let limbo, will very likely make your retirement miserable in 20-30 years...
Branded as such? What? I'm constantly pestered by messaging which is telling me to get involved in these issues. The point is, I care, but I have more pressing issues to work on. Yes, my family members getting harrassed because of their skin color is an issue that affects me, but if I am getting kicked out of my apartment for not paying the rent then it is not an issue I can spend time or money on. Even if I did spend time or money on these 'one percenter' issues, the negative impact to my life would be great while my contribution would have a negligible impact on the issue.
I have no time to virtue signal by participating in meaningless social activism. I will help individuals where I can because that is somewhere where I can meaningfully affect change with my actions.
Maybe it's my age. Maybe I'm cynical, I don't know. I used to care about these things. I bought a crappy house in a crappy neighborhood to save gas. I wasted money on a solar panel system. I planted native plants, composted and grew my own fruits and vegetables. I was worse off for it, and no change came from it. If I managed to save any resources, they were quickly consumed by some other wasteful excess of society.
Unless your activism is effective, it is useless. It is basically religion at that point.
> Branded as such? What? I'm constantly pestered by messaging which is telling me to get involved in these issues.
You are also constantly bombarded by messaging telling you not to and to focus narrowly on short-term self-interest, from the opposite side of the political spectrum.
The one you view as “pestering” is just the one you haven’t internalized.
Calling racial inequality a “one percenter” problem makes sense if you consider non-White people to be not real, but only an abstraction of concern to Whites (and, only, apparently, White elites.)
And a lot of those other issues have immediate, near-term impacts on the immediate prospects for families outside of the elites, (and without regard to divisions like race), so even from a narrow short-term self-interest standpoint don't make a lot of sense tongues as one-percenter problems even as much as political messaging from the Right paints them as elite distractions from immediate economic concerns.
To this day I find the focus on income or wealth inequality to be perplexing. I literally just don't get it. Why should I care whether or not some crazy rich person can buy a yacht? It does me no harm.
It's not the yacht, nor the money per se.
It's the power they wield. A single person can entirely overtake democracy when he has billions.
He can own press, politicians, etc.
That's because he tried to play fair.
Look at Sheldon Adelson, I won't talk about US politics, but during the last twenty years he pretty much changed the entire press landscape of Israel subordinating it to Netanyahu. He made a huge impact on Israel politics and public opinion.
Of course it does you harm. These people control what you know (education, the media), what you will buy (advertising), your health. They mostly control the politicians you are voting for. They can impose their will on you in almost any facet of your life. That is morally wrong to start with, and practically a problem in many ways, especially when their main goal is to keep themselves in power at any cost.
What do you think about the claim that non profits like Bill's are only designated such to get favorable tax policies and are actually profit driven investment vehicles?
I've done a bit of math on Jeff Bezos's wealth. Lets say we were looking to put a 5% wealth tax on holdings over $1billion.
Jeff owns approx $166,500,000,000 in Amazon stock, at $3000/share, and 11.5% of the company (55,500,000 million shares). Lets assume that this is where ALL his wealth is (its not).
That 5% tax on that would be $8,275,000,000. Were Jeff to sell shares to cover this, it would cost 2,758,333 shares. That would reduce his ownership of Amazon from 11.5% to 10.75%. Hardly the loss of a controlling interest.
So by what moral justification can there be for the morality of having and holding $166,500,000,000 in wealth? That government is inefficient? That he can make better investments? Who do those investments benefit? Even assuming supply-side economics works to lift all boats (it doesn't, mostly), is it more moral to lift a middle-class person into the upper-middle class, a poor person into the middle-class, both, or neither?
What I think is more likely is they just don't have to ever deal with people who are suffering, and have justified it in their minds as themselves being greater and this is the way of things. Certainly those that end up with billions of dollars at their disposal don't hold the same moral compass. And constant reminders of abject poverty haven't helped billionaires in developing countries do more to help the poor.
1) I think a wealth tax is a reasonable way to look at raising revenue overall since it is neutral about _how_ the wealth was acquired (inheritance, cap gains, etc.). On a spectrum of regressive vs graduated taxation, sales tax is pretty evil, income tax is ok but too easy to dodge (AMT was applied to try to patch this but didn't do a great job of it), so it's really left to wealth tax to provide appropriately graduated taxation and hopefully coupled with a reduction in sales taxes. It should be anticipated that there will be clever loopholes here, such as having billionaire individuals appear near-penniless by having them grant their wealth to a trust whose only job it is to take care of said billionaire. :) Those more clever than I should map out best practices for closing these.
2) Framing things as a one-off tax is probably not a great idea. Once it's done once, there will be demands to go back to the trough, and it would be better for everyone to have the certainty around when and how that will work, so a proposal to have an indefinite 0.5%/year wealth tax I think makes a lot more sense than a one-time 5%. (Imagine how lucky you'd be if you become an overnight billionaire in 2021 and dodged the bullet!) Furthermore, the real net needs to help our society thrive long-term are far more than a one-time 5% billionaire wealth tax could capture. It reminds me a little of the meme that Mike Bloomberg could afford to give every American a million dollars. https://twitter.com/NorthmanTrader/status/123584359225130188...
3) Overall, a system more focused on taking wealth than creating it will itself crater. There's been a lot of dialogue roughly summed up as "eat the rich" that lays out all kinds of very exciting ways to spend money but just assumes that lots of wealth will magically get created, or that there's a fixed pie of wealth out there so we should just take it from those that have it. No, I'm not a Randian Objectivist (and yes, I've read Atlas Shrugged), I believe that society should intelligently invest in its human capital with a goal of maximizing everyone's human potential. A society that does well at that will generate lots of wealth and will have lots of good answers possible for how to share and spread that wealth. And the US is demonstrably not doing a good job at economic mobility, which is to say our branding of "anyone can make it" doesn't seem to be lining up with people's lived realities very well. So I find it less helpful to talk about "are you a bad person if you are a billionaire" and more helpful to talk about what factors are keeping portions of our society from achieving as much as they could and how we could collectively tackle these factors (or more to the OP's point, find effective ways to get out of these people's way instead of assuming we know how to fix their problems!).
4) A lot of the overall discussion about inequality decenters from the very real and tangible global progress that has been made on eliminating poverty. The data is staggering in its velocity, and wildly unreported since good news is nowhere near as exciting to link to and discuss as bad news. https://ourworldindata.org/grapher/share-of-population-livin... - but the story in the US is much more grim, with poverty on the rise, stagnation in wages, and the hollowing out of the middle class. So we can say that the world (and China in particular) is trending in the right direction toward elimination of poverty and equitable wealth generation, and the US's policies and environment are trending the wrong way. There's some data to suggest that 90's era welfare reform is to blame, see nradov↗
A wealth tax is attractive in theory but it's hard to put into practice for illiquid assets like privately held companies, real estate, intellectual property, and artwork. The optics are bad when the government effectively forces someone to sell off part of the family farm to pay that year's wealth tax.
Why oh why is it always "the family farm"? At this point, that deserves its own named fallacy. Fine, let's make the first $10 million tax exempt. Or is the hypothetical "family farm" a family farm like Johnson & Johnson is a family company?
Of course, the reason that fallacy exists is because it works. Every argument against increased progressive taxation has been extensively focus-group tested, of course it works. But the need to consciously counter that messaging doesn't render the policy impractical.
Because when the income tax was introduced in 1913 it also was a small percentage of income only for the super rich (7% with the first 500K exempt, 1913's 500K was a bit more than 2020's 10M you suggested).
Not trolling, but how much money is too much? Most everyone on this site is the top 1% of global households. Where is our morality then? Rhetorical question: do you give away a substantial portion of your largesse?
But let's say he gave away all his wealth, which would be about $60 to every household in the world. Is that more helpful? I think sometimes big problems take resources. My biggest complaint is that he has shown the ability to execute at scale and most of the companies they invest in don't. Spending even three months operationalizing one of these companies could be like a 100x on the money in.
> he gave away all his wealth, which would be about $60 to every household in the world.
No one is asking for such naive approach to redistribute wealth.
It's to find better ways to utilize the wealth, which Bill himself would also agree in principle.
What exactly the format requires discussion. But the first step is to allow such discussion to happen. And we are sure that a lot of the world people are not believing the meaningfulness of such discussion...
I guess I'm missing something. Isn't that the whole point of the foundation? To give away its money in ways they find most impactful? They don't tells us how to distribute our charity dollars. It seems silly for us to tell them how to distribute theirs.
It's always been interesting to me that the people most opposed to wealth gaps live in SF and LA. I'm sure they love the weather but I don't think that's all they're after.
A counterargument is that "nothing happens in a vacuum" and their lack of economic fulfillment is due to this wealth gap. But I think we owe billionaires this same level of uncertainty. They only exist because society doesn't want to know what would happen if they were forced to give their wealth away.
Side note, in my experience living in California many of my "broke" friends are actually terrible with money. I was talking to a guy the other day who spends $800/month on rent and $1500 on food. I'm sure it doesn't represent the whole, but in general I look at California liberals with a critical eye when talking about the wealth gap.
This is the same argument that has been around for decades - the debate over whether Bill Gates and the Gates Foundation were an agent for good or an agent for helping Bill Gates sleep at night was a huge thing when I was in graduate school.
I think it's unfortunate that this part of the debate gets the focus.
What I think is problematic in the Gates approach and those like it, is that they view the world through so many institutional and market filters that they don't notice various problems bubbling up that can't be measured in these terms.
The most obvious thing is Gates' line "the world is getting better" which hinges on the fact the more people are moving from outside the money economy to inside the money economy (less people "living on pennies a day"). The problem is Gates can't see that people insider the money economy are in desperate circumstances.
The recent interview with Gates was distinctly sad. In one area where he sort-of has things right, he doesn't understand that the flood of irrational here is very pushed by other monied interests which have become used to fending off all spending on longer-term social interests since these serve as threats to their short term profits. See this article describing the similarity of climate denialist and covid denialists: https://www.yaleclimateconnections.org/2020/04/coronavirus-d...
Immediately, the author assumes that everyone is playing a zero-sum game, which is the root of the problem with his viewpoint:
"We've got about 400 people in this room.... Imagine if dinner was carted into this room, and four people got half the food. The night would end in violence,"
What's the tangible evidence that the world is a positive-sum game? The tangible evidence to me seems to suggest it's a zero-sum game. E.g., a product costs $X, owners get too large of a % of that compared to employees.
That's an interesting question, and I don't have an answer. But what you can not deny, is that the system that produced those billionaires, is the same one that produced such a rise in wealth and standard of living worldwide. We better be very careful about not throwing out the baby with the bathwater.
We should also consider being careful about how we divvy up the fruits of workers labour, lest they decide they're not happy with the current arrangement and the "wealth is not a zero sum game" style excuses, and proceed to throw out both the baby and the bathwater - or maybe something less dramatic, like elect a reality TV star to a second term as President, followed by who knows what after that.
I can’t deny that, but I can certainly point out that billionaires coinciding with the rise in quality does not mean that they were even produced by the same system, or that the presence of the billionaires was in any way necessary.
To reframe your point: maybe we should be careful to identify where the baby is and spend a little less attention on what billionaires want.
It seems pretty clear that capitalism tends to produce concentrations of wealth. Billionaires are created by capitalism because of this tendency. The question is if you can stop the tendency of capitalism without killing the system altogether. We just have to keep in mind, for all its faults, it has a track record of provably doing more for the well-being and prosperity of masses of average people more than any other system.
Billionaires are a byproduct of the market mechanisms that produces that wealth. They don’t “profit from it disproportionately” enough to justify messing with the system. (In the US, billionaires make only about 1.5% of total annual income.)
> They don’t “profit from it disproportionately” enough to justify messing with the system. (In the US, billionaires make only about 1.5% of total annual income.)
What percentage does that equal on the lower end? You say it does not justify messing with the system, but what is that based on? What would you feel is an equitable distribution of wealth within a country?
That question isn't very useful. A better question would be: “does there exist a more effective system?” (“Does that system have billionaires?” is an interesting question, too.)
Richer if you put more value on having an addictive piece of electronics in your back pocket rather than a few acres of land to be self sufficient on.
There are definite improvements (a fair amount of medical science), but I'm not sure on balance that the planetary destruction/extinctions/etc outweigh them. So, using made up GDP/capita numbers for justification that the world is "improving" is tenuous.
I do, as do most people. When you hear talk about subsistence farmers who live on less than a dollar a day and don't have running water, that's what the "few acres of land to be self sufficient on" lifestyle looks like in the absence of a strong market economy.
Have you looked at the homeless in your city? Sure they might be fed with cheap food, but they are living under bridges. So, that is what a "strong market economy" gets you too.
So don't compare the worse case subsistence farmer, with what was middle class in the US a few decades ago, where suburban houses on a couple acres were affordable my the top 70% of the population. We have more trinkets, but the price of basic necessities are becoming more "expensive" every day.
These are the average case subsistence farmers. The worst case ones live even harder lives than an homeless person, very often dying of starvation after a bad harvest.
The middle class in the US a few decades ago lived pretty good lives, but were very much dependent on market economies and innovation for their standard of living.
You can easily have "a few acres of land to be self-sufficent on". Clearly you don't value that, so you don't have it. If you actually value it, go get it.
If the world were just a bunch of fields with a static farm economy and no innovation in cultivation, then your point would be correct. But innovation increases the size of the pie. Yeah, the jealous may focus on the percentage kept by these innovators, but they really should be looking at the share of the pie.
Socialism is all about making sure that everyone is equally miserable.
As someone from a third world country where people live in poverty, my view is that new ideas are bad and dangerous. There is a blueprint for poor countries to become wealthy ones: free markets, rule of law, liberal democracy. It’s how the countries that are currently rich became rich. It worked in Japan, Korea, Singapore, Hong Kong, etc. Its working in myriad other countries. While academics fuck around with “new ideas” progress is deferred and people suffer in poverty.
A lot of really bad ideas have been tried and failed to work in this world and we should learn from them - that said I don't know if America's version of a liberal democracy has proven itself to be that great in the long run. There was a period of extreme common wealth growth but after WW2 (about the eighties) that's mostly dried up. While we need to recognize failures abroad (i.e. the Soviet system implemented by Lenin and its offshoots) I think our own system needs some active maintenance to be rebalanced. Lately the extremes have grown too wide and we need to do like Teddy and break up some of the big concentrations of wealth so that the engine can keep running clean for another half-century or so.
It's misleading to think of any democratic style government as being in stasis - the world is constantly in flux.
You're disregarding the negative examples. Free markets have been tried and failed in Argentina, Russia, and to various degrees everywhere in most former 'communist' countries - they quickly turned into cleptocracy and corruption. China showed that you can get very wealthy without rule of law and without liberal democracy, and with massive government intervention in the market (but not with a planned economy).
In my own country, free markets only started bringing prosperity after getting at least some semblance of liberal democracy and rule of law - before that, in the absence of a strong state, it was a very literal robber barons' paradise.
> E.g., a product costs $X, owners get too large of a % of that compared to employees.
this is orthogonal to the economy being positive/negative/zero sum. if total real wealth increases over time, the world is positive sum, regardless of how that wealth is distributed.
positive sum doesn't imply that everyone gets wealthier over time, only that it's possible for people to get wealthier without it being directly at the expense of others.
So because a homeless person today has $1, can sleep under a bridge in a jacket they got from Goodwill rather than $0.05 like 50 years ago or sleeping under a tree possibly getting eaten by wolves, this means the world is positive sum?
Standard of living has improved generally over time, but day by day the world is a zero-sum game.
> So because a homeless person today has $1, can sleep under a bridge in a jacket they got from Goodwill rather than $0.05 like 50 years ago or sleeping under a tree possibly getting eaten by wolves, this means the world is positive sum?
I'm not entirely certain what you mean by this question. the homeless person could even be worse off today than they were fifty years ago, and the economy could simultaneously be positive-sum. suppose you have an economy with two people that each start with $100k. if after 10 years, one person has $500k and the other has nothing, this is a positive-sum game because the total gains exceed the total losses. positive sum does not imply that everyone, or even most people, will become wealthier over time.
> Standard of living has improved generally over time, but day by day the world is a zero-sum game.
if you pick an infinitesimally small window of time where nothing can be produced, then sure, I guess you could say any changes in wealth would have to be zero-sum (assuming you could somehow transfer wealth instantly). I don't really think this is a useful analysis though. over the course of a whole day, the economy could be positive, negative, or zero sum. it depends on how much total wealth was created and destroyed on that day. even in an hour, I could create something of value that didn't exist before, or an explosion could go off in a port causing billions of dollars worth of damage.
>What's the tangible evidence that the world is a positive-sum game?
LEDs. To take one very specific, simple example, though feel free to substitute in everything from computers to engines. Fundamentally, we have both increased our average energy budget per person and we can accomplish far more of what we want to do for far less energy. Taking the basic general goal of "I wish to have visible photons available to me at a sufficient level for my eyes to work well at arbitrary times and places", compare the total costs and % of resources converted to the goal vs wasted as heat/losses/externalities of say torches to oil/gas lamps to electric arc to early incandescent to later incandescent to halogen to fluorescent to LEDs. We can now do with single watts for tens of thousands of hours and pennies of silicon/impurities what would once have taken dozens to hundreds of watts to kilowatts and lasting just hundreds of hours, tens of hours, or even mere minutes.
Increasing abundance and efficiency for human goals is the definition of increasing overall wealth. Even given imbalance in ultimate distribution, the pie has absolutely grown larger. Massively humongously wildly larger. Positive spirals thankfully abound, such as better nutrition and knowledge of infectious disease at young ages yielding better outcomes and life expectancies for the rest of their lives. None of this is to downplay the importance of keeping inequality from going too far, but to even suggest it's a zero-sum game, that world economics are actually the same right now as they were a hundred or a thousand years ago, is frankly ludicrous.
Edit:
>E.g., a product costs $X, owners get too large of a % of that compared to employees.
That makes absolutely no sense as a standard or line of reasoning. The total sum has nothing inherently to do with how its divided, are you sure you're clear on definitions here? When something is zero-sum that means that for anyone to gain a larger percentage, someone else must necessarily lose a smaller percentage. But when the total sum itself is increasing then somebody could be gaining more and everyone else could also be gaining more, just not as much more as if it were equally split.
Also, what is "too large of a %" and how do you know? And if the product costs $X, but previously other competing products cost 7*$X, and as a result the company is many times the size it would be otherwise, and in turn the % the employees get is still an absolute amount far larger then it would have been anywhere else, now what? Rather then thinking about fuzzy "proper %" it seems better to investigate power imbalances, human limit edge cases, information asymmetry, cost externalization, etc., that affect the equilibrium of the system. Of which there are many!
The fact that we can bake another pie doesn't make pie-eating positive-sum. The more you eat, the less is available for others, and you can't keep baking pies for ever.
LEDs are the discovery that we didn't actually need as much firewood to bake those pies.
You can't bake pies forever, no. But the stars are vast and many. That's yet another semantic stop sign: a phrase you say when you don't want to think about things any more, just like "it's not zero-sum".
>The fact that we can bake another pie doesn't make pie-eating positive-sum.
The fact that we can "bake another pie" for 1/100 the resources is the definition of positive-sum. There is now more to go around. Even if previously the pie was perfectly divided but now of 100 pies 20% goes to whomever came up with the better way and another 50% goes to whomever financed the better way, the remaining 30% to the masses is still 30x the pie. I'm really not sure what you're confused by here, unless you're getting really lost in analogies.
Again: a basic definition of increasing wealth is increasing core abundance and efficiency. There can be more useful energy/resources to accomplish goals with, and there can be more efficient ways to achieve goals. Either or both combined mean there is genuinely more to go around. How best to distribute energy/resources remains very important, but does not change that having more and/or having it go farther means more wealth overall.
I think you're focusing too much on the metaphor. The example the person above gave using LEDs is very good.
For the sake of simplicity, I'm just going to stick to the United States. As the previous commenter explained, the introduction of LEDs (along with cheap methods of manufacturing them) lead to much cheaper and more effective lighting. Undoubtedly there were companies and individuals that stood to profit quite a bit from these inventions. I don't know whether it helped create any billionaires, but certainly there are similar examples which have. On the other hand, although it created more wealth for those individuals, it created wealth for the entire country. Now every American has more money to spend because they don't have to spend as much money replacing their light bulbs.
In this case, the fact that some people gained much more wealth from this series of inventions is not a bad thing because everyone also benefited. In fact, the reason that inventions like this even come into existence is precisely because there is high reward for the individuals or companies doing so.
There are absolutely certain markets where things are much messier, but overall it's certainly not zero-sum. The issue is that many Americans do not have high enough wages or benefits to meet their family's needs. We should be working towards addressing poverty, not towards some moral tirade against billionaires.
Edit: I honestly can't express these concepts nearly as eloquently as xoa has in their comments, so I'd suggest referring to those.
"Imagine four people got all the food, and the rest got another 20%" is still imbalanced, even with 120% of the food. And there still would be violence. The problem is that the benefits of anything not zero-sum disproportionately accrue to the people who already have more than enough. And that simultaneously zero-sum resources also disproportionately accrue to the ones who already have so much.
It's not "playing a zero sum game" when you question why e.g. Bezos should accrue another $40 billion in net value, while hospitals struggle to provide PPE to their health care workers.
It's not "a zero sum game" if you ask why we have a world where somebody can hoard $150 billion while 800 million people need to go hungry every day.
Hugely disproportional resource allocation will break civilizations, zero-sum or not. (I'm fairly convinced that some inequality might contribute to a better society, but we've exceeded reasonable limits long ago)
Your mention about hospitals makes me wonder whether we should call the problem "resource allocation". Maybe it's an issue of resource leaks? For example, hospitals get a lot of money, objectively, but there are also whole industries that parasite on that money, by overcharging, vendor-locking, encouraging waste, and doing all the kinds of shady things competitive companies tend to do.
Yes, absolutely. Any economy is ultimately about efficient resource allocation.
The question is then, how do you measure efficiency. Proponents of a more equal world argue that the current extreme imbalance is only "efficient" for a very small subset of the population, and likely inefficient both for the vast majority, and for long-term success of societies.
The long-term question is basically a result of economies being feedback loops - if benefits accrue inequally, and capital results in opportunities, any system that doesn't have some negative feedback loops ultimately will amplify the inequality more and more.
In extremis, that means one person with all the resources. I'd argue that this is an outcome that probably nobody wants.
And in the context of OP: unless the total cake grows faster than the inequality, this holds true for non-zero-sum games, too.
The world has experienced tremendous growth in the past. It doesn't right now (and it can't sustainably continue growth in many areas), so the question is, what feedback loops do we want in place.
yes, that's a principle line of criticism of (crony) capitalism, that the efficient allocation condition no longer holds. greater wealth concentration enables greater distortions, and ultimately to the destruction, of free and fair markets that are the crux of capitalism.
When people defend capitalism online, they're usually defending crony capitalism – mostly because they're trying to defend capitalism against people criticising it, but don't know what capitalism is (other than that it's good).
Most people advocating for rich people's existence is that they can more effectively utilize the resources and power. But they never tough upon the imbalance itself.
The imbalance has 2 aspects to it:
* Utility: Does imbalance proclaims efficiency.
* Morality: Is it moral to have imbalance.
Of ucz, both aspects need themselves to be balanced. I.e., we do encourage people with the obvious talent to enjoy imbalanced power and fortune. Like the young Steve Jobs, Bill Gates, and now Elon Musk. It is more utilitarian, and more moral to have these people enjoying more imbalanced power and fortune, then the older Steve, Bill, and Elon; in the sense, that when they are less talent, they should be pushed to be less entitled, and prefer a more moral position in the imbalance.
I mean, what Bill Gates does is not particularly more brilliant than a government directed research organization. Then why do we allow such a large fortune sit there without being spent for the people, after all, the fortunate was not earned by Bill the individual, it's a symbol of attribution through the capitalism system.
Exactly. Capitalism adds more wealth to the mix. The creators are incentivized to increase the size of the pie. Sure, they may take a lot on a percentage basis, but most people still do quite well.
Places like Venezuela and Soviet Russia tried to distribute things equally and the richest people in those worlds had it worse than the 10th percentile in capitalist countries. This is why the Soviet Union had to build a wall to keep people in but the US is considering building a wall to keep people out.
1. How's that the fault of the wealthy? Blame the politicians who are mandating crazy inconsistent policies of keeping big businesses open while closing the small businesses down.
2. A stock price going up is not exactly getting "richer".
> How's that the fault of the wealthy? Blame the politicians who are mandating crazy inconsistent policies of keeping big businesses open while closing
It's almost like capital ownership awards undue power that can then be used to further entrench power.
If we are blaming them for further entrenching power, then we are also to blame ourselves who voted for the politicians to allow this to happen and to fall for propaganda from those same "rich" people.
When the richest man in the US who happens to own the largest online shopping site and also uses his own newspaper to push more propaganda to push for more lockdowns - thus eliminating more competition from small businesses, is the richest man to be blamed or are the politicians listening to him and the people reading his propaganda newspaper and following orders to be blamed too?
When all the massive multi-national corporations that have questionable hiring, firing, healthcare, worker's rights, and safety track records promote and sponsor your cause and your Revolution has corporate sponsorship, you are not a revolutionary, you are a pawn.
It's just amazing how those who kept advocating for opening up small businesses and ending the lockdowns got called all sorts of names by the same people who complain about the rich getting richer.
It is the fault of leadership, but the US leaders in particular seem to be an extremely wealthy bunch (or at least they claim to be).
It seems to be the key attribute now.
Well, the shorter answer is that ownership and control of capital is where their power derives from. Thus, they get to make the decisions of how wealth is distributed, and it mostly benefits themselves
The stock market did not go up because of the increase in people's incomes. It went up because of several trillion dollars worth of cash injections from the Federal Bank. For everyone else, unemployment has pushed to 10% on the low end and I'll repeat the part about 40 million people looking at evictions by the end of the year.
And "rich people usually get rich through capital markets" is just a fancy of way of saying they have ownership of everything and profit off of other peoples's labor
Incomes have gone up, including for the unemployed. Fiscal stimulus can accomplish much more than monetary policy through the multiplier so comparing headline numbers doesn't mean anything.
And yeah rich people own assets. That's like the definition of a rich person. Take your ax and grind it somewhere else.
Incomes went up only for the unemployed who got the $600/week unemployment benefit, which just expired. And that's just for the pandemic. Real wages, the actual value of one's wages relative to the expenses in costs in society, have been in a decline since the 80s. Yet, the wealthy have come to control more and more wealth.
This isn't some ax to grind. This is life under a system where the wealthy rule and the rest of us have no choice but to work for them or starve.
It sounds like whoever managed to get political support in that community is making the economic decisions, rather than “themselves”. Individual property rights simply devolves that control to the individual or the family. Communal property rights would place control of property into the hands of the elites. I’m not saying the current system is perfect, but I’m the system to you’re describing I don’t see how someone gets a new technology to market without the support of the elites. It’s at least possible today, and leads to the collective increase in standards of living.
The system we live in is one in which everything is in the control of the elites. Who makes all the decisions about technology? The CEOs of massive tech firms. Who makes all the political decisions in government? To a person almost exclusively the rich, those who hoard capital.
I’m not going to argue that our political and social economic systems don’t have flaws. I do think directly merging political and economic power into the same institutions would only make it worse.
Have you seen the footage coming out Chicago, New York and Portland of police beating people in the streets? You might want to ask what country is putting the jackboot on people's necks to maintain social order
Which countries have tried to distribute wealth? Most countries that people usually claim that about have actually done the opposite - they were trying to put the jack boot to a few million people's necks, and found that claims about redistribution of wealth can win you enough followers to actually do that. This is certainly true of Lenin and Stalin and Mao.
What about the system we had between WWII and Reaganomics, when not only was income inequality smaller, but most of computing was also invented (using state money)?
The obvious solution for healthy society is mixed economy - free, but reasonably regulated, market as the engine of prosperity and strong welfare system so that nobody goes hungry, without education or without healthcare.
Some Western countries got close to the right balance, e.g. Germany or Canada. USA got the market economy quite right, but I think a bit better social benefits (esp. universal healthcare) would benefit the society as a whole.
On the other hand, we have seen great successes of free market in the past few decades, for example the former Eastern block countries, esp. the ones that managed to get into the European Union. I grew up in Slovakia and saw the country go from failing socialist economy to high-income advanced market-based economy, while still keeping most of the generous benefits which are generally in-line with the rest of the EU. The GDP per capita literally went 10x in the past 30 years.
Other classic example is of course China (although here the democratization process didn't take place). Or even the Scandinavian countries introduced many pro-free-market reforms in the recent decades with great success, while still having very very generous welfare system.
Absolutely. If you divided up Bill Gates’ wealth among everyone in India and Bangladesh everyone would get $65. That would be a one-time redistribution. His contributions through the Gates foundation are immensely more valuable in the long run.
This isn't untrue but I think it's a naive approach. If that money was divided between the governments to spend for their citizen's welfare then they could also invest it to benefit their citizens.
The question (the big one that America is super divided over) is which actor is better at allocating goods for public well-being, a billionaire who has proven (probably) they have good business acumen or the government that (ideally) exists to work for the benefit of the people.
I have my personal opinion but I wanted to neutrally (I hope) highlight that this is the heart of the issue.
> This isn't untrue but I think it's a naive approach. If that money was divided between the governments to spend for their citizen's welfare then they could also invest it to benefit their citizens.
Especially in the developing world, governments are more likely to piss away money given to them than to invest that money to the benefit of citizens.
If governments were good at investing money communism would have worked. There would be no point having companies like Apple develop cell phones if the government could do it just as well without enriching shareholders in the process. We’d just have a government agency in charge of building cell phones and giving them away or selling them to citizens at cost. We don’t have a private sector for funsies. We have it because we recognize that governments aren’t good at investing money and producing results.
I am of a split mind on that topic - on the one hand I agree with you that massive corruption is pretty commonplace within some governments... on the other hand you've been talking about India which (while not a great example of a lack of corruption) has managed to invest heavily into toilets to fight against an epidemic of rape aaaand, I'm concerned about falling into the colonialism trap of "We in the west know better" - that road doesn't lead to good things in the long run.
I don't know which approach is better but I know that both roads contain pretty significant dangers and both contain benefits.
Additionally, I'm not particularly interested in going down a path towards communism - the leninist soviet system was an utter failure but germany and scandinavia seem to be doing pretty alright - in fact, on the topic of cell phones, Nokia started out in Finland which is a pretty heavily socialist country. I think there are a lot of options on the spectrum between 1637s Dutch Capitalism and Leninist Soviets - both extremes result in failure and, IMO, all centrist solutions are constantly being pulled toward the nearer of the extremes and need to actively work to stay from slipping into those dark places.
> the leninist soviet system was an utter failure but germany and scandinavia seem to be doing pretty alright
Yes, and Germany and Scandinavian countries are liberal capitalist economies where the means of production are predominately owned by the private sector. In fact, Sweden has more billionaires per capita than the US.
> fight against an epidemic of rape aaaand, I'm concerned about falling into the colonialism trap of "We in the west know better" - that road doesn't lead to good things in the long run.
The west does know better. Not because they’re better, but because as a matter of historical accident they stumbled upon a set of winning ideas. Colonialism was bad. But that’s in the past. The choice people in former colonies are faced with is what to do now. And as someone from one of those countries, I think we’re fucking stupid if we reject the west’s winning ideas just because we’re bitter about colonialism. That’s cutting off your nose to spite your face.
People who talk about decolonization make me livid. I’d like to be able to take my kids to see Bangladesh some day without worrying about them getting sick from the water. Decolonization won’t do that. Capitalism, the rule of law, and liberal democracy will do that. I don’t care who came up with it first.
Government misapplication of funds is the reason so much is wrong in this world. The idea some government politician or worse a group of them could better employ the money of a Gates or Bezos is ludicrous. They have all already proven they cannot. Gates does better with his money because he isn't doing one thing politicians love to do, punish by giving and taking money from groups.
Governments routinely punish the poor for nothing more than being poor. In the US this is done through fees, penalties, licensing, direct taxation, and embedded taxes. Government routinely targets the poor for enforcement efforts because the officials know they cannot afford to fight back, hence why so much forfeiture in the US is of that class.
You can take all the wealth of every US Billionaire and not fix anything because the political class will not fix what is already wrong with their spending. More money just means more likelihood of more money spent wrong.
The only source of wealth that can pay for all the promises being made this cycle is from the middle and upper classes combined.
TWO TRILLION Dollars comprise Social Security, Medicare, and Medicade, tell me who giving them more will solve anything when they cannot care for Americans with two trillion dollars. Worse this is on top of state aid programs and programs coming out of another nearly 1.5 trillion dollars in various aid programs.
The various levels of the US government spend $6-7 trillion annually. That’s about the same as the total wealth, accumulated over a lifetime, of all known billionaires.
This is the commonly assumed tension but I think it's a slightly false dichotomy.
The choices are not just between concentrating an obscene amount of money with individuals vs concentrating an obscene amount of money with a handful of bureaucrats.
Why have a system that allows so much money to be concentrated with any kind of entity in the first place and put everyone else at the mercy of their philanthropy? MHO handing all that money to the government instead of a billionaire class is just changing from private trickle-down economics to nationalised ones.
As soon as your having someone deal with billions of dollars a couple thousands become a rounding error and your local concerns become benign, small picture issue. But for you having that 3000 available to finally fix that pothole on your street is critical.
Worker co-ops, taxes on municipal level and wealth taxes might be ways to prevent extreme concentration with any entity.
I don't think you can have people who are wealthy without having people who aren't. Wealth is a relative measure, therefore there are those who aren't.
Let's imagine a scenario where 400 people each have $1, the average wealth is therefore $1 per person. If, however, we have 1% of people (4 in the same scenario) have $2 each, the overall wealth is still $1 per person on average, however the 1% would have $2 per person and the remaining 99% would have $0.99 per person. If we skew that a little more, let's have 50% of the total wealth ($200) in the hands of the 1% (again, just 4 people). The average for the population is still $1 per person, but the 1% now have $50 each and the remaining 99% have just over $0.50 each.
I get that this is an exercise in explaining what zero-sum is, something you don't believe this situation reflects, but it's important to recognize that people build wealth by acquiring it from somewhere else. If there was an infinite supply of money (there isn't), then we could have a conversation about this not being zero-sum. I don't think it's a good faith discussion to start with the assumption that money is infinite.
Money isn't infinite, but billionaires don't have a billion dollars of money. They have a billion dollars of assets, and it's very possible to create new assets without creating new money. When people say e.g. Zuckerberg is worth $100 billion, that doesn't mean $100 billion of money has flowed to him or is locked up in his vaults.
On the other hand, money is one of the most plentiful, elements of the economy.
"There are 10^11 stars in the galaxy. That used to be a huge number. But it's only a hundred billion. It's less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers."
- Richard Feynman
Money is also the most fungible element of the economy. Given monetary policy, particularly the Fed's policies of the last decade or so, it is also not good faith to assume money as a constant.
> it is also not good faith to assume money as a constant.
Agreed. It's not constant and it's not infinite. The question then becomes at what rate does it grow and is that rate higher or lower than the stratification of wealth. If it's higher, it's either hyperinflation or wealth accumulation appears logarithmic in growth. If it's lower, it's either deflation or wealth accumulation appears exponential in growth.
It appears to be lower and wealth accumulation does, indeed, appear to be exponential. We're also completely glossing over just who it is that's likely to be wealthy and suddenly it's not just an economic issue, but a socioeconomic one.
The scary question that comes after that ( similarly with world population ) is what we can do about it. The solutions tend to scare people, who have the most to lose ( and money to prevent any actual change ). Hell, I personally think that there has to be a hard limit on power ( money ). Where that limit is up to debate, but it has to exist somewhere. The power of one billionaire is way to excessive and comparable to that of old monarch. The only thing they are missing is an army ( and a cheap army may only be a generation away ).
> Immediately, the author assumes that everyone is playing a zero-sum game
Is it not true that when the books are balanced at the end of a period, wealth resulting from economic activity within the period ends up distributed among the public such that not every person does not end up with an identical amount? If so, is it possible to state this without simultaneously believing that economics is a zero-sum game?
If I set fire to the fields, there is less wealth. Therefore, it's not zero-sum.
A zero-sum game is one in which no strategy changes the amount of wealth available. There are clearly strategies that create or destroy wealth. Therefore, it's not a zero-sum game.
(This does not imply that every player has ever-increasing wealth each turn.)
I did not assert that wealth is a zero sum game, I was replying to this:
>> Immediately, the author assumes that everyone is playing a zero-sum game, which is the root of the problem with his viewpoint: "We've got about 400 people in this room.... Imagine if dinner was carted into this room, and four people got half the food. The night would end in violence,"
"economics is not zero sum game", "correlation != causation", etc - certain ideas seem to be kind of like catnip for humans.
No, more like once the ideas are learned, they seem to excite the mind once a person is (or perceives to be) in the presence of an example. A loose variation of Baader-Meinhof phenomenon perhaps.
It was not that long ago (a year or so? Just when the trade war rhetoric with China was heating up) when "lolololll, economics is not a zero sum game!!!" seemed to be a satisfactory dismissal of Trump's issues with China's trade practices, both in the media and in forums. Shortly after, when the various media outlets seemed to all have a spontaneous change of heart on the matter and get onto the same page of noticing that there actually is a fair amount of complexity involved in international trade, and since then I've read very little "zero-sum" talk on the matter. Perhaps a media blitz on this issue might help illuminate more of the unseen complexity in this situation, although that scenario seems a bit less likely to me.
Not a zero-sum game, the pie is growing etc are some of the reasons we tell ourselves so that we (the middle class knowledger workers) can sleep at night. I bought 'Winners take all' last year, but finally started reading it recently and finished more than 50%. I would like the commenters to read an author's work before criticizing it, otherwise you are the one who is making assumptions.
This quote stood out to me, too. I'm not sure that the night would end in violence if it was the organizers of the dinner who took half the food. I feel like the more complete analogy is that 4 people organize the dinner (the elite 4). They make enough food for 1,000, distribute the best cuts out of about 100 meals among themselves, give the other 396 people 400 meals to share among themselves, and sell the other 500 meals to another party, pocketing an overall profit for their endeavor.
Would the other 396 look at the elite 4 in envy? Awe? Hate? Appreciation? Would they enjoy the 400 meals in a fairly equal way, or would they fight over allocations? Would the elite 4 encourage fair distribution of the 400 meals, or would they encourage in-fighting among the other 396, causing sufficient turmoil to distract the other 396 from organizing their own elite-and-profitable meals? There are a lot of scenarios that don't end in violence, even if a lot of people leave with a bad taste in their mouths.
I think it's a really interesting analogy, and it might even bolster the author's points about the importance of how elites behave and what systems they promote. It's too bad that the analogy was cut short with a reductionist assertion.
Maybe a different way to look at this - "Imagine 400 people in a room. 10 can get all the food they can eat i.e unlimited food. 200 people get one plate of food. 100 people get half a plate of poor quality food. The rest get half a carrot". This situation lasts a week. What would happen?
This is such a bad analogy, I stopped listening to the rest of his arguments. Why did the four people get half the food? If it was because the organizer picked his four favorite people, sure, people would feel like it is unfair. That's a dictatorship.
If it was because they planted the crops, tended the fields, and did all the work to harvest and prepare it, I don't think any reasonable person would complain. We feel like that is a fair outcome because most nations have collectively agreed that owning property is a fundamental human right. In the US it's the 5th amendment.
Sure, but in reality the people who tended the fields never get that much of the food - whether it's feudal lords or modern capitalists, labour never gets paid the full amount of what they've produced.
If I may fix a major assumption, I'd like to acknowledge it:
> If it was because they [enslaved or underpaid people who] planted the crops, tended the fields, and did all the work to harvest and prepare it, I don't think any reasonable person would complain. We feel like that is a fair outcome because most nations have collectively agreed that owning property is a fundamental human right. In the US it's the 5th amendment.
All of a sudden it doesn't sound so reasonable and yet comes off a fair bit truer than the original.
That's a different scenario than the one I presented. Sure, people would be upset if the four people got their dinner by using slaves. Hence my point that the "why" really matters.
However, I believe I've stated more than just slave labor. It's a very relative thing, but it appears many people are certainly underpaid compared to the wealth they generate for the few. It's starting to feel like people in tech believe otherwise because they're compensated better than average and therefore might be "above it all". I think that's alarming and short-sighted.
There wouldn't be violence. 396 people would say "forget this guy," and find somewhere that they could get food. People vote with their feet (and their wallet).
Even non-elite do-gooders 'fixing' the world are part of the problem IMO. For example, cancel culture is the end result of non-elite do-gooders banding together to "do good". I believe the net effect is actually quite bad, but the people engaging in cancel culture really believe they are helping fix the world.
Cancel culture* is not new. If you say you are a cannibal and eat human flesh, you're out of a job, same thing 100 years ago I assume. The thing that is slowly shifting is what is morally acceptable, or perhaps that more voices are part of the discussion of what is morally acceptable.
Shame has its function. Personally, I'm more worried about people who are proud to not use morals and are not hypocritical about it, than the do-gooders who put the bar higher than they can live up to.
Yes, they are more often hypocrites. That's great, you can point to that and expect some kind of feedback loop to have effect.
People without shame, who apply no morals to their deeds, are not to be applauded. I hope you agree when it comes to things like child beating. Now the questions is where to draw the line for cancel culture. Not if cancel culture is a 'bad thing'.
* Probably people load the word 'cancel culture' differently. I see it as pointing out morally bad behavior, and asking other people to also notice it, hoping there will be repercussions.
A lot of people refer to cancel culture this way, because they're bigots who don't like people pointing out that they're bigots (or fans of bigots who they don't like being called out as bigots).
However, there is another problem: a “dark side” of people being willing to call others out on their shit. Clickbait.
It's surprisingly easy to make it seem like arbitrary person X is an evil evil person, regardless of whether they actually are. If you're familiar with person X, you might be able to spot a lie… but being universally sceptical will protect you from legitimate call-outs as well as fake ones. The average person has no real way of knowing, even if it's occurred to them that they might need to check.
So, yeah: overall, I think this is probably a good thing. But it's set back the lives of some good people.
(There's a rather simple way to turn this around: remove guilt by association. It should be okay to defend cancelled people. Defending bad actions doesn't need to be okay, but if it's costless to lie / “bend the truth” for social media clicks and costly to rebut them… calling people out on their shit becomes a much less useful force for good.)
Media and companies should not 'cancel' just because a group of people is demanding it, but it could be reason to look into something and then make up their own mind.
Wanted to rant on about lots more, but I'll let it go :)
This subject always reminds me of the quote from popular and beloved British actor Paul Eddington, which puts on display a very different and much gentler ethos from the “doer-ism” sprayed on us quite constantly: "A journalist once asked me what I would like my epitaph to be and I said I think I would like it to be, 'He did very little harm'. And that's not easy. Most people seem to me to do a great deal of harm. If I could be remembered as having done very little [harm], that would suit me."
It’s worth pondering whether the same (limited) perspective that caused several problems is sufficient to fix some problems without exacerbating others. The whole point of democratization of power is to distribute decision-making so people could make the right choices as locally apt.
Interesting... I used to have similar ideas about "at least do no harm", but the intolerance of the times radicalized me somewhat and the new mantra is not only to reduce the harm I do, but to also somewhat counter the harm others do: either by negating them or their deeds. Because if we let some harm seep through because we ignored it, that is still not good enough for our society.
Now of course we (the people) look at things differently so me going carbon negative (for example) may encourage others to pollute even more because hey u/kshacker is going to fix it so I know the thought process needs further evolution.
The point of the quote is not so much about countering harm caused by others, but first: How confident can you be that your actions to help are not misguidedly exacerbating problems? Is there a line beyond which one could be overconfident, our arrogant? What external feedback should you attend to?
I disagree with the notion that "elite do-gooders" (which seems like a pejorative phrasing) are part of the problem. These people have worked hard and brought innovations to the world to generate their wealth. They have great judgment and lots of experience, and they should be afforded the freedom to invest in the problems they value and the freedom to manage those solutions. Chances are, they will end up being more impactful than the typical waste that comes with slow-moving, bureaucratic, bloated governmental organizations.
However I do also support creating a more functional market with enough room to enter so that other innovative, motivated entrepreneurs can effectively compete. That doesn't require some kind of destructive ground up rethinking or abandonment of capitalism. It requires a tweak - namely updated anti-trust laws that are actively enforced. This would achieve a different distribution of wealth and power while retaining the mechanisms we have in place to reward success precisely.
> These people have worked hard and brought innovations to the world to generate their wealth.
The richest three Americans have more money than the poorest 50% of Americans combined. However hard those three worked worked, there is no way that they worked harder than half the country.
As COVID-19 has shown us, you don’t get far without the jobs we value the least. We need supermarkets open, bins taken away, rest homes cleaned etc.
Wealth is further concentrating too, exacerbating the issue.
Anand Giridharadas has a degree in politics and history. Completely unqualified to comment about issues that are fundamentally about economics, public health, etc. I’ve watched over the last 30 years as the “age of capital” has lifted millions out of poverty, and organizations like the Gates foundation have helped drop the infant mortality rate by 3/4 since my family left the country.
Meanwhile, socialists like Giridharadas have done nothing but hold the country back, trying to keep us in poverty. Millions of children are dead because of the multi-decade detour socialists line Giridharadas took India and Bangladesh in during the 1960s-1990s.
The same Politicians have been in power for 6 decades and haven't achieved anything they have promised every election. So how exactly did their "political decisions" help?
So then we can praise authoritarian capitalism for this massive reduction of poverty that you were doting on about. Seems like a questionable thing for you to be supporting, but to each their own.
Obviously democratic capitalism is better, such as what happened in Sweden in the 20th century, or America in the 19th century. But authoritarian capitalism is better than socialism of any form for poverty reduction.
Huh. It's always weird when people are out in the open about their fascism.
Your point of reference for, "democratic capitalism," has half of it's period with outright slavery and the other half with brutal segregation and fascist violence through Klan lynchings. That's the good part in your eyes.
Certainly not in rayiners golden era. Slavery wasn't abolished through democracy and civil rights were won 60 years after the end of rayiners golden era.
How did we get the 13th amendment if not through the democratic process described in the constitution?
There’s some semantic argument here about whether there’s a causal relationship between democracy and legislation, but that’s missing the point.
Slavery in the U.S. was a democratic issue since its inception. Although Jefferson’s victory over the Federalists largely reframed the concerns of the voting populace away from slavery for most of the early 19th century, abolitionism eventually become an insurmountable movement. This movement had so much public support for and against it, that it grew into a civil war. I’m not sure how you can justify that it wasn’t democratic.
Professional pundits 'offering' old observations, watered down to the point of near-meaninglessness, as their own original ideas, are part of the problem: prvc
Resource attribution seems to follow the power law. Is there a way to solve around this without creating unintended consequences which are worse?
There probably isn’t even too much difference over the ages either. It’s just in America’s democratic-republic with capitalism the billionaires aren’t royalty.
Can't think of anything but progressive taxation and redistribution of such taxed money. The power law comes from various positive feedback loops on the market, so it sounds only fair that if you want to clamp it down, you need to inject a strong negative feedback loop into the mix.
Envy was once considered to be one of the seven deadly sins before it became one of the most admired virtues under its new name, “social justice." - Thomas Sowell
Rather than just downvoting, I'll offer another perspective. Sowell's statement is vacuous, just a bumpersticker retort. Rather than engaging in the issue, it simply questions the motives of the opposite party and in fact dismisses their motives as one of the seven deadly sins.
I realize this is twitter and not a well developed thesis, but that just means twitter is a terrible platform to meaningfully engage in nuanced topics. It is a great platform for shallow thinking and insults, though, akin to the excuse, "I have a wonderful proof of this but the margin it too small to contain it."
What you say about Twitter sounds about right, but Sowell appears to have put a bumper-sticker quote on a bumper-sticker; he's written a bunch of long books if you want to find out more about his views.
Sowell has written plenty of books on these topics which are worthy reading. The quote is from one of his books. The twitter account I linked is not actually Sowell's. He doesn't have twitter. The account simply posts quotes from his books.
So no, it's not just a bumpersticker retort. Growing up in a poor south asian country, I was taught to only care about the food on my plate and not be jealous of the food on someone else's plate. That made me work hard at putting more food on my own plate without being jealous and stealing from another's plate.
The problem is not the food on my plate, the problem is I see many millions beside me with too little food and a few guys with at least 30000000 times of what they could ever want or need.
No person has 30000000 times what they could ever want or need. You need about a million dollars to retire early with a family, 30000000 times that would be 30 trillion dollars. Nobody is even close to that.
"Thou shalt love the Lord thy God with all thy heart, and with all thy soul, and with all thy mind. This is the first and greatest commandment. And the second is like unto it. Thou shalt love thy neighbour as thyself. On these two commandments hang all the law and the prophets." - Matthew 22:36-40
Any attempt to use the Christian bible to justify massive inequality is a bastardization of Jesus' teachings.
We're not talking about inequality in the sense that people deserve all the same things. Everyone deserves at least to be fed, housed, and taken care of when sick. A society capable of such but unwilling is disgusting.
Maybe you could debate to what degree we could provide for each other. We don't have limitless resources and capabilities. But certainly, we have the ability to provide everyone with clean water, food, and housing at this point.
I come from a poor south asian country. The idea that western countries like US, Canada etc don't have "food and shelter" is absurd. I can understand examples like Flint's water issue but that's the fault of the very politicians people keep voting in again and again. It's not the fault of all the rich people.
Everyone who's willing to put a tiny bit of effort can get food and shelter thanks to food banks, shelters etc. Back in my country, we don't have that luxury yet but a lot of religious places are trying their best at providing that.
I am not religious myself but I do think they should play an important role at feeding those who don't have the resources yet.
Once your basic necessity like food and water have been solved, it's up to you to work your way up.
America is one of the most obese countries with obesity being more prevalent at lower income levels, yet we keep hearing about how people are starving.
I don't think it's unreasonable to include more things under "basic necessities" nowadays. Things like security, education, healthcare, internet access are all common candidates.
The problem in America derives from politics. There are two main issues.
The first is that politicians are selected by the rich. Since a Supreme Court Ruling (Citizens United), unnamed donors are able to give infinite money to political campaigns. So the rich buy the politicians and then the politicians decrease regulation and increase subsidies for the rich people's companies who elected them.
The second is that there is lots of aid and available resources but the government makes it hard to access this aid. Part of the government (the Republicans) doesn't want this aid to exist so they purposely make the administration of the aid very difficult to get. It becomes a full time job just getting free things creating a cycle of poverty and dependency. You can see the Republican party doing this with the US Postal Service right now. They mess up the program and then claim it doesn't work.
For America to improve, money must be eliminated from elections. We need a constitutional amendment to overturn Citizens United. Next, we must make programs simple and easy to obtain the benefit from. It shouldn't take multiple hours a day to get "free" food. This is why some people support the idea of a universal basic income. It would help the poor the most with the least amount of government overhead.
Imagine for a moment that there really was injustice in the world, and that some people really cared about it. How helpful would it be to deride their sentiment as envy? Seeking something for others doesn't meet the definition of envy; even if it did, attribution of motive is still a fallacy and the side order of appeal to authority only compounds it. Sowell's tweet is a dishonest, dismissive take that could only appeal to the worst kind of culture warrior and has no place in reasoned conversation.
Overall, I think parts of this approach might throw the baby out with the bathwater. Even if we do restructure the way that society works, presumably we'll still care about interventions to improve well-being. I think effective altruism (https://www.effectivealtruism.com/) has provided a lot of traction on how to think about these issues. Even if you disagree with their moral stance, I think it's hard to deny that people in the EA community have been very thoughtful about quantifying interventions and thinking about impact.
And I don't think these sorts of questions are going to go away, come a social restructuring. There seems to be a lot that we can salvage from the EA viewpoint, even if we decide systemic change is the way forward, and I think that's worth emphasizing.
The idea that the problem is that some own more than others is itself an idea promoted by those who "own more than others". They set that as the thing to be argued about.
The actual problem is social relations. The heir expropriates the surplus labor time of the worker. That is the real problem.
Wealth redistribution is, in a dialectic sense, a goal of those who own the most wealth. It is a goal set by this elite. Workers controlling our own labor time has been the clear goal of the worker's movement for at least a century and a half, if not longer.
Ironically, the author was talking about all those other elites. Click less, but not before you've added my book to your cart! "If only" I could vote on how you spend your money.
As I read it, his main point is a valid one. If you want change, you have to participate in making that change. That participation is not limited to once every 4 year vote ( in US ), but rather an ongoing participation in society.
There are some valid criticism of this approach ( demoracracy doesn't scale well; it does work well on more local level, but you don't want to have a vote for every little issue ).
I read Giridharadas' book, and I found it to be pretty narrowly focused on hypocrisy of the wealthy class. Sure, there is a lot of undeserved back patting about how much good people are really doing in the world, but that's probably always been the case. I would have preferred a serious treatment of the ways in which the world has been improved through the mass reduction of deadly infectious disease, famine, and extreme poverty. Steven Pinker's Enlightenment Now explores these topics. To read Giridharadas, you might think that all social ills are caused by the wealthy in society, which made it harder for me to take his side on everything.
Still, his main point stands that elites should feel bad about their concentrations of power and that the link between money and political power should be weakened.
It is much worse than this; the elite works to actively divide the populace and distract us. Note how divisive politics has become; divide and conquer.
It is kind of funny reading through these comments. The author's point is that power should be distributed and decisions should be made outside of those with concentrated amounts of wealth. Kind of like a democracy.
Folks on this thread seem to be falling over themselves arguing that billionaires are justified to even be billionaires at all.
The issue isn't that billionaires exist, its that billionaires have cornered all the decision making abilities of the public.
We _do_ live in a democracy (well, a republic -- in the USA). The government/legislature does seem, to a large extent, to be beholden to the wants of the immensely wealthy, but that's only because the electorate at large won't hold their representatives accountable for that behavior.
Despite having more resources and more leisure time than has been possible throughout most of history, people don't stay informed, contemplate policy, engage in activism, interact with their legislators ...
The laws of human psychology may simply not afford people people enough agency for a large democracy to be fair and effective.
Essentially, you, me, the author of this piece is saying the same thing. The populace needs to take back control over their governance, and the way the author is proposing to do that is by getting involved in by "joining organizations, membership lists and movements that work toward building cross-racial, cross-class coalitions of people — with a goal to create a future that benefits most people."
"Giridharadas calls on people to join organizations, membership lists and movements that work toward building cross-racial, cross-class coalitions of people — with a goal to create a future that benefits most people."
Thinking for just a few minutes, there are so many facets and nuances to the issue of improving the world for others that the above sentence is a complete throw-away. One could get involved and sign up, but as the article already points out, how to know if the group you are joining is doing good or doing more harm? Did you join a group of virtue signallers or will you roll up your sleeves for Habitat for Humanity, or Doctors without Borders?
A couple of notions:
- How do you know if your effort is more like bailing water from a sinking ship, or, towing the ship into dry dock for repair? Maybe you have to bail at the same time you're towing.
- What is the actual goal? To ensure that people are able to eat today? Are you trying to right a wrong, like human trafficking or environmental crimes? Are you trying to create a level playing field so people are able to go as far as their determination will take them? If you want a level playing field, what system are you modeling?
The desire to do something is invaluable. I'd suggest two things: 1) keep it close to home. The farther the served are from you the harder it will be to see the results. If your aspirations are far from you, make it a goal to get there and see first hand what you're trying to aid, at least once. 2) Make it something where you can directly observe the results and know that your efforts are having a positive effect overall.
"We've got about 400 people in this room.... Imagine if dinner was carted into this room, and four people got half the food. The night would end in violence," Anand Giridharadas told IDEAS host Nahlah Ayed at a public event hosted by the Samara Centre for Democracy."
Violence is unethical. Half of the food is theirs who is the rest to take it away from them?
Architecting a working system requires objectivity. What happens when you have different doctrines in power? What do the prototypes of each model look like? What does the Big(O) of resource distribution look like (and where are the leaks).
In a government managed system, you have a MASSIVE amount pooled resources controlled by whoever activated (or coerced) the most voters. What is the worst case scenario? Whoever is in power has a narrow list of buddies with businesses. Lucrative government contracts with little oversight on spending are taken to people who have some favor with the elected officials or their family members (and pay officials back in insider stock trading, or planned small stock dumps, or some other form of laundering). Money accrues to the family tree of those in power and those in power make all important decisions, eventually draining the country. Read the news in Eastern Europe for a while to see a live simulation.
Foundations. Anyone can start one, fulfill a mission, work to make the world a better place. A lot of foundations are doing a lot of good out there, so where does that model leak? With stringent requirement to hold no profit at the end of the day, worst case scenarios with foundations look like this: Similarly to government, the distribution of large quantity of pooled resources can go to the team running the foundation. In some, the executives collect whatever money is left at the end of the day (can't leave a profit after all). In others, a foundation on the side of a lucrative business gets the profits to reduce the tax burden on the business, but then distributes those to friends as contracts or generates sales from that business at increased margins, etc. How do you know this is happening? If you look at the ever increasing number of foundations, there are no incentives to create economies of scale in giving, despite the high fixed costs of running of foundation. Where are the foundation mergers that would make giving more efficient? Thus the tax incentives given by government can sometimes turn foundations south.
Where do Billionaires come in? A actually self-made billionaire has presumably lost the need to be corrupt. They have also proven themselves able to lead people to execute projects efficiently. The combination of resources, networks, and lack of misaligned incentives makes them more likely to focus on the impact of the work, than on self-enrichment with it. The down sides can happen if the original billions were a con-scheme and not actually acquired (Madoff), or if the billionaire is completely incompetent in the field they are giving in, or if they do it for the attention and ego boost, and social favors that may come from being asked for money. With all the attention paid to one person, however they can be more easily scrutinized than the other two models.
Please do feel free to contribute to this analysis tree.
It's fascinating and saddening that this conversation that clearly needs to be had within this community is being reported so frequently and fervently that it's dropped from front page to third page in less than 30 minutes.
It seems it becomes a taboo to question the staggering inequality in personal fortune. While at the same time, media are not shy away from waging wars on racial inequality. But it seems to me that addressing economic inequality most likely greatly solves the racial equality.
I never saw any individual who are less qualified for an opportunity, where the inequality in opportunity cannot be fixed by strong social support in his or her earlier life through education and community.
It of cuz will be slow. But that's precisely the time scale we need to think about to make addressing inequality possible to start. I.e. we don't want Bill gates or Jeff bezos to think we want to deprive their personal fortune. Instead, we are looking for better ways to help them use the resources when they themselves lack the means or techniques.
If we want to discuss topics like this then one way is to be careful to be nonviolent and that means objective.
One problem I see in pointing at the billionaires and claiming wrongs is it’s obviously an attack and puts them and anyone who feels they could be pointed at on defense.
Instead, point out how people are held back by the systems and positions of power.
When I had a particularly abusive management chain (4 managers for 9 workers) they could ask just about anything of me. The corporate policies gave them wide rights over even my personal liberties. For one, they could change my schedule at any time. Meanwhile, I could be lawfully terminated for varying my work schedule in excess of an 8 minute tolerance. That termination would mean all sorts of things - like owing back rent on an apartment I would have left - because I had no way to pay it. The way that particular industry worked, too, meant one termination likely meant I would never again work in that industry. That screams inequality to me.
Edit-That inequality has the effect of making any order my management gave me as a functional threat of my ability to maintain my very way of life. Without that job I would have been homeless shortly.
I like Anand, I find his blind belief in democracy = good, not-democracy = bad - problematic.
You can have a disastrous democracy and a neighbour dictator that mounts an attack and wipes your democracy off the face of the earth.
It's about competency, not political ideology. Until people get it in their heads that competency and science are two fundamental tools that move humanity where most people would unambiguously want to be headed, we are going to have an endless problem.
They call it corruption - it's just people who don't understand what moves the needle for them and others, resorting to moving the needle for them first, the rest maybe later.
That's what these Bill Gates and every other rich person in America is about - nobody has a unifying plan to move humanity forward, so they get rich and by the time they become rich, they've made friends with a bunch of other rich people. Now people like Anand come and say hey, you know all those friends you have? They're all doing bad things and you are too, you are bad.
What is rhetoric of this sort going to accomplish but separate us into us vs them even further?
Until people understand how to move the needle for most people including them, they will always resort to moving the needle for them and their family first and that is where we currently are.
If you want a different world - it has to come from a unifying message, not a message of blaming other people for your plight. This call for democracy is really a call for de-throning rich people and unless you want a dictator to come into power and start a civil war - this is not the rhetoric you want to promote.
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[ 4.3 ms ] story [ 234 ms ] threadThe difference is the out-in-the-open, stark, startling, and seemingly completely baked in income inequality. I think people outside of academia are finally talking about the morality of a billionaire's mere existence.
maybe both?
It's all one in the same problem. Philanthropy comes from wealth accumulation.
If he owned 9% instead of 10% and I owned the difference of 1%, then I would be better off.
P.S. He owns 11.1% and had more before his divorce.
Look around where you live, at the things that you value. How many of them were created with human effort, versus just existed in nature? Look at everything from computer you're typing on to the chair that you're sitting in to the roof over your head. EVERYTHING that was created with human effort is an example of wealth creation.
Without dismissing your point, I would strongly push back against effort being synonymous with wealth creation. Having grown up in post-Communist Eastern Europe, there was no virtually correlation between the two.
In the United States, it's a different story. The tide is rising, but most boats have not been rising with the tides for about 40 years, and that's troubling.
https://www.epi.org/publication/swa-wages-2019/
The figure you linked does not indicate adjustment for inflation and does not segment expenditures by wealth, which is important, because the US economy as a whole is growing, but more than 100% of the growth is flowing to the top. The rich get richer, the poor (and middle class) get poorer. You have to segment by income to see this trend.
Inflation adjustments are tricky because it’s not really obvious how to measure inflation. But even adjusted for CPI inflation personal consumption expenditures have been steadily increasing in the 20th century: https://alfred.stlouisfed.org/series?seid=A794RX0Q048SBEA
Tangent 1: Placeholder: I don't agree that consumption metrics are better.
Tangent 2: Rich people do consume (colloquially speaking) proportionally to their increased wealth, but after sating their material desires they turn to financial assets: dibs on passive income and future growth. More for them does mean less for everyone else. Both in the first-order sense of owning more shares and in the second-order sense of being on the winning side of prevailing trends in globalization, automation, tax law, and corruption.
Someone should tell the record companies who say when you pirate a song, you're stealing from the artist who will not be properly compensated for the time they labored to write and record that song. I see corporate spokesmen expounding the labor theory of value all the time.
As far as LTV is concerned, we know it to be a flawed theory today because we understand the time value of money. LTV will hold in the long run with constant returns to scale. Without constant returns to scale, only the marginal consumer matters. In simpler terms, demand will affect price, not just supply. Now, if we make the errant assumption that the supply curve is completely flat in the long run, then LTV does in fact hold. That is, the LTV is not a terrible description of economic reality, as long as you note that a) an isomorphic argument can be made for “the land theory of value” or “capital theory of value”, so labor is in no way special, and b) LTV can only apply for goods with flat long-run supply curves. In any case, there’s a reason the early great economists used it! Smith, Ricardo, and others were not all idiots. However, today, we know better and it flies in the face of modern science and understanding to promote its use.
As a result of the above, the value of a natural resource changes over time. For example, natural resources used in electronics and batteries are relatively more expensive now than they were 100 years ago.
So, you can be technically correct by saying that wealth is zero-sum, but that's pretty much the same thing as saying "the world's 'wealth' traded for natural resources sums up to 100% of all natural resources"
[0] https://en.wikipedia.org/wiki/Resource
It's the same with everything. When you're not at your limits of your ecosystem - things aren't zero sum. However once you do hit your limits, things become zero sum.
You even see this with businesses. Industries go through a growth phase. In the startup-growth-adoption phase, all businesses in that industry can grow. However, once market matures and reaches saturation, businesses struggle to grow or change. The only significant way mature businesses can grow larger at that point, is via mergers and acquisitions of other businesses.
A limit is a limit, doesn't matter if that's a demand limit, or a production limit, or a resource limit. The effect is still the same. Being under limits, makes things zero sum. If those limits were suddenly removed or increased temporarily, things would return to not being zero sum - at least until you hit another limit.
>It is rare that it means that not more can be produced.
In practicality sure. I'm sure we could make more basketballs than we do now. But physically speaking, you'd eventually hit limits. The earth is not infinite... we certainly could not make more basketballs than there is mass of earth itself. At which point we would either have to make new basketballs out of old basketballs, (zero sum), or raise our limits (mine matter out of other celestial bodies).
Why do you think so?
> In practicality sure.
And that is what matters? Why is it interesting that there is a theoretical limit on how many basketballs that is possible to produce with the resources available on Earth when no conceivable situation exists when that limit ever becomes relevant?
On an individual basis there are multiple portions of the economy for which wealth could be modeled or interpreted as a zero-sum game. Examples include landlord/renter relationships in high rent burden environments, or other segments where an individual is unlikely to ever be able to afford a "share of future economic growth" in order to fund retirement etc.
Lots of markets (most markets?) aren't growing at any particular moment. We should really figure out how to fix our system in the low-growth zero-sum regime because it's common and important.
Jeff Bezos owning 10% of amazon does not place prohibitions on the amount of dollars you can spend.
Also, if Jeff's workers have more wealth, they don't have to spend a lot of their disposable income on paying student loans or mortgages, and they will have more money to buy more stuff.
There seems to be little correlation, much less causation, between the amount he pays his employees and the value of the firm in which he holds interest.
https://www.nytimes.com/2006/04/05/business/the-economics-of...
The title "président des très riches" wasn't born out of nowhere, was it?
gdp (national wealth) is a made-up metric, it's aggregate, it's dynamic, incomplete relative to its stated rationale for existence, inapplicable to the discussion, and a whole host of other irrelevances to a real understanding of wealth and its distortions.
¿Por qué no los dos?
For a concrete example, a tremendous amount of money has recently flowed into sex education advocacy, some of which doesn’t have donor names attached to it.
Organizations that aim to provide resources around things like consent and healthy sexual behavior find that courting this new money involves adopting an abstinence-only approach as a mandate. As a result, it’s hard to know if the organization you’re donating to is actually doing the advocacy work they used to advertise, and they’re not always inclined to be transparent around who calls the shots from a donor perspective.
We like to think that political money lives only in super PACs and lobbying efforts, but this isn’t the case, and in some ways this makes the non-profit situation even more insidious. To be clear, I’m not denigrating all non-profit work, there are just some major transparency issues that need to be addressed.
George Soros and his 'Open Society Foundation' is another example.
But more generally, there is a whitewashing going on. Look at the Sackler family, which for decades got to put their names on museums, hospitals, etc. they get to go around spreading a story about how good they are while rotting out communities with their dirty opioid pushing. They got called out, sure, but how many other Sacklers are out there with their reputations unburnished?
"Money talks, wealth whispers."
These problems sound like they have nothing to do with wealthy people standing up for one cause or another. The issue is that the wealth is so often created or amplified by greedily outsourcing these problems to the powerless. The wealth begets more power, and institutions that launder the story of that wealth into a whitewashed canvas of do goodery.
Look at how much more political activism there is in the US during the COVID crisis. People have more time since they're working from home, and they're able to actually participate for the first time in a long while. Imagine how many more people would be able to vote if election day was a national holiday. It's honestly criminal that it's not.
Any of these problems, can directly affect your children.
Let me tell you one example, my parents generation suffered much higher cancer rate than normal. That's caused by 40 years of rapid industrialization in China.
Think about it, these issues let limbo, will very likely make your retirement miserable in 20-30 years...
I have no time to virtue signal by participating in meaningless social activism. I will help individuals where I can because that is somewhere where I can meaningfully affect change with my actions.
Maybe it's my age. Maybe I'm cynical, I don't know. I used to care about these things. I bought a crappy house in a crappy neighborhood to save gas. I wasted money on a solar panel system. I planted native plants, composted and grew my own fruits and vegetables. I was worse off for it, and no change came from it. If I managed to save any resources, they were quickly consumed by some other wasteful excess of society.
Unless your activism is effective, it is useless. It is basically religion at that point.
You are also constantly bombarded by messaging telling you not to and to focus narrowly on short-term self-interest, from the opposite side of the political spectrum.
The one you view as “pestering” is just the one you haven’t internalized.
And a lot of those other issues have immediate, near-term impacts on the immediate prospects for families outside of the elites, (and without regard to divisions like race), so even from a narrow short-term self-interest standpoint don't make a lot of sense tongues as one-percenter problems even as much as political messaging from the Right paints them as elite distractions from immediate economic concerns.
Examples: Look at how people argue over fictional characters or franchises.
Worth billions, wanted to run for President, spent hundreds of millions on ads and got nowhere.
Bloomberg couldn’t even get his parties nomination.
I guess billions doesn’t get you that much power.
Only if the country is corrupt, a well functioning democracy can't be bought.
If Amazon or McDonalds paid their workers more and their CEO's less, the lives of many millions of people would improve.
If they were just printing money for themselves, and using inflation to lower the value of your money, you would see it and be upset.
They're doing the same thing with power.
http://sfonline.barnard.edu/navigating-neoliberalism-in-the-...
Jeff owns approx $166,500,000,000 in Amazon stock, at $3000/share, and 11.5% of the company (55,500,000 million shares). Lets assume that this is where ALL his wealth is (its not).
That 5% tax on that would be $8,275,000,000. Were Jeff to sell shares to cover this, it would cost 2,758,333 shares. That would reduce his ownership of Amazon from 11.5% to 10.75%. Hardly the loss of a controlling interest.
So by what moral justification can there be for the morality of having and holding $166,500,000,000 in wealth? That government is inefficient? That he can make better investments? Who do those investments benefit? Even assuming supply-side economics works to lift all boats (it doesn't, mostly), is it more moral to lift a middle-class person into the upper-middle class, a poor person into the middle-class, both, or neither?
What I think is more likely is they just don't have to ever deal with people who are suffering, and have justified it in their minds as themselves being greater and this is the way of things. Certainly those that end up with billions of dollars at their disposal don't hold the same moral compass. And constant reminders of abject poverty haven't helped billionaires in developing countries do more to help the poor.
2) Framing things as a one-off tax is probably not a great idea. Once it's done once, there will be demands to go back to the trough, and it would be better for everyone to have the certainty around when and how that will work, so a proposal to have an indefinite 0.5%/year wealth tax I think makes a lot more sense than a one-time 5%. (Imagine how lucky you'd be if you become an overnight billionaire in 2021 and dodged the bullet!) Furthermore, the real net needs to help our society thrive long-term are far more than a one-time 5% billionaire wealth tax could capture. It reminds me a little of the meme that Mike Bloomberg could afford to give every American a million dollars. https://twitter.com/NorthmanTrader/status/123584359225130188...
3) Overall, a system more focused on taking wealth than creating it will itself crater. There's been a lot of dialogue roughly summed up as "eat the rich" that lays out all kinds of very exciting ways to spend money but just assumes that lots of wealth will magically get created, or that there's a fixed pie of wealth out there so we should just take it from those that have it. No, I'm not a Randian Objectivist (and yes, I've read Atlas Shrugged), I believe that society should intelligently invest in its human capital with a goal of maximizing everyone's human potential. A society that does well at that will generate lots of wealth and will have lots of good answers possible for how to share and spread that wealth. And the US is demonstrably not doing a good job at economic mobility, which is to say our branding of "anyone can make it" doesn't seem to be lining up with people's lived realities very well. So I find it less helpful to talk about "are you a bad person if you are a billionaire" and more helpful to talk about what factors are keeping portions of our society from achieving as much as they could and how we could collectively tackle these factors (or more to the OP's point, find effective ways to get out of these people's way instead of assuming we know how to fix their problems!).
4) A lot of the overall discussion about inequality decenters from the very real and tangible global progress that has been made on eliminating poverty. The data is staggering in its velocity, and wildly unreported since good news is nowhere near as exciting to link to and discuss as bad news. https://ourworldindata.org/grapher/share-of-population-livin... - but the story in the US is much more grim, with poverty on the rise, stagnation in wages, and the hollowing out of the middle class. So we can say that the world (and China in particular) is trending in the right direction toward elimination of poverty and equitable wealth generation, and the US's policies and environment are trending the wrong way. There's some data to suggest that 90's era welfare reform is to blame, see nradov ↗ A wealth tax is attractive in theory but it's hard to put into practice for illiquid assets like privately held companies, real estate, intellectual property, and artwork. The optics are bad when the government effectively forces someone to sell off part of the family farm to pay that year's wealth tax. paledot ↗ Why oh why is it always "the family farm"? At this point, that deserves its own named fallacy. Fine, let's make the first $10 million tax exempt. Or is the hypothetical "family farm" a family farm like Johnson & Johnson is a family company? pandaman ↗ >Why oh why is it always "the family farm"?
Of course, the reason that fallacy exists is because it works. Every argument against increased progressive taxation has been extensively focus-group tested, of course it works. But the need to consciously counter that messaging doesn't render the policy impractical.
Because when the income tax was introduced in 1913 it also was a small percentage of income only for the super rich (7% with the first 500K exempt, 1913's 500K was a bit more than 2020's 10M you suggested).
But let's say he gave away all his wealth, which would be about $60 to every household in the world. Is that more helpful? I think sometimes big problems take resources. My biggest complaint is that he has shown the ability to execute at scale and most of the companies they invest in don't. Spending even three months operationalizing one of these companies could be like a 100x on the money in.
No one is asking for such naive approach to redistribute wealth.
It's to find better ways to utilize the wealth, which Bill himself would also agree in principle.
What exactly the format requires discussion. But the first step is to allow such discussion to happen. And we are sure that a lot of the world people are not believing the meaningfulness of such discussion...
And that's a big problem.
A counterargument is that "nothing happens in a vacuum" and their lack of economic fulfillment is due to this wealth gap. But I think we owe billionaires this same level of uncertainty. They only exist because society doesn't want to know what would happen if they were forced to give their wealth away.
Side note, in my experience living in California many of my "broke" friends are actually terrible with money. I was talking to a guy the other day who spends $800/month on rent and $1500 on food. I'm sure it doesn't represent the whole, but in general I look at California liberals with a critical eye when talking about the wealth gap.
I think it's unfortunate that this part of the debate gets the focus.
What I think is problematic in the Gates approach and those like it, is that they view the world through so many institutional and market filters that they don't notice various problems bubbling up that can't be measured in these terms.
The most obvious thing is Gates' line "the world is getting better" which hinges on the fact the more people are moving from outside the money economy to inside the money economy (less people "living on pennies a day"). The problem is Gates can't see that people insider the money economy are in desperate circumstances.
The recent interview with Gates was distinctly sad. In one area where he sort-of has things right, he doesn't understand that the flood of irrational here is very pushed by other monied interests which have become used to fending off all spending on longer-term social interests since these serve as threats to their short term profits. See this article describing the similarity of climate denialist and covid denialists: https://www.yaleclimateconnections.org/2020/04/coronavirus-d...
To reframe your point: maybe we should be careful to identify where the baby is and spend a little less attention on what billionaires want.
What percentage does that equal on the lower end? You say it does not justify messing with the system, but what is that based on? What would you feel is an equitable distribution of wealth within a country?
There are definite improvements (a fair amount of medical science), but I'm not sure on balance that the planetary destruction/extinctions/etc outweigh them. So, using made up GDP/capita numbers for justification that the world is "improving" is tenuous.
So don't compare the worse case subsistence farmer, with what was middle class in the US a few decades ago, where suburban houses on a couple acres were affordable my the top 70% of the population. We have more trinkets, but the price of basic necessities are becoming more "expensive" every day.
The middle class in the US a few decades ago lived pretty good lives, but were very much dependent on market economies and innovation for their standard of living.
https://ourworldindata.org/grapher/average-real-gdp-per-capi...
Day-by-day the world is zero sum.
If the world were just a bunch of fields with a static farm economy and no innovation in cultivation, then your point would be correct. But innovation increases the size of the pie. Yeah, the jealous may focus on the percentage kept by these innovators, but they really should be looking at the share of the pie.
Socialism is all about making sure that everyone is equally miserable.
We collectively are not done, yet. We can still make it better for everyone. Let's at least _try_ new ideas.
It's misleading to think of any democratic style government as being in stasis - the world is constantly in flux.
In my own country, free markets only started bringing prosperity after getting at least some semblance of liberal democracy and rule of law - before that, in the absence of a strong state, it was a very literal robber barons' paradise.
this is orthogonal to the economy being positive/negative/zero sum. if total real wealth increases over time, the world is positive sum, regardless of how that wealth is distributed.
positive sum doesn't imply that everyone gets wealthier over time, only that it's possible for people to get wealthier without it being directly at the expense of others.
Standard of living has improved generally over time, but day by day the world is a zero-sum game.
I'm not entirely certain what you mean by this question. the homeless person could even be worse off today than they were fifty years ago, and the economy could simultaneously be positive-sum. suppose you have an economy with two people that each start with $100k. if after 10 years, one person has $500k and the other has nothing, this is a positive-sum game because the total gains exceed the total losses. positive sum does not imply that everyone, or even most people, will become wealthier over time.
> Standard of living has improved generally over time, but day by day the world is a zero-sum game.
if you pick an infinitesimally small window of time where nothing can be produced, then sure, I guess you could say any changes in wealth would have to be zero-sum (assuming you could somehow transfer wealth instantly). I don't really think this is a useful analysis though. over the course of a whole day, the economy could be positive, negative, or zero sum. it depends on how much total wealth was created and destroyed on that day. even in an hour, I could create something of value that didn't exist before, or an explosion could go off in a port causing billions of dollars worth of damage.
LEDs. To take one very specific, simple example, though feel free to substitute in everything from computers to engines. Fundamentally, we have both increased our average energy budget per person and we can accomplish far more of what we want to do for far less energy. Taking the basic general goal of "I wish to have visible photons available to me at a sufficient level for my eyes to work well at arbitrary times and places", compare the total costs and % of resources converted to the goal vs wasted as heat/losses/externalities of say torches to oil/gas lamps to electric arc to early incandescent to later incandescent to halogen to fluorescent to LEDs. We can now do with single watts for tens of thousands of hours and pennies of silicon/impurities what would once have taken dozens to hundreds of watts to kilowatts and lasting just hundreds of hours, tens of hours, or even mere minutes.
Increasing abundance and efficiency for human goals is the definition of increasing overall wealth. Even given imbalance in ultimate distribution, the pie has absolutely grown larger. Massively humongously wildly larger. Positive spirals thankfully abound, such as better nutrition and knowledge of infectious disease at young ages yielding better outcomes and life expectancies for the rest of their lives. None of this is to downplay the importance of keeping inequality from going too far, but to even suggest it's a zero-sum game, that world economics are actually the same right now as they were a hundred or a thousand years ago, is frankly ludicrous.
Edit:
>E.g., a product costs $X, owners get too large of a % of that compared to employees.
That makes absolutely no sense as a standard or line of reasoning. The total sum has nothing inherently to do with how its divided, are you sure you're clear on definitions here? When something is zero-sum that means that for anyone to gain a larger percentage, someone else must necessarily lose a smaller percentage. But when the total sum itself is increasing then somebody could be gaining more and everyone else could also be gaining more, just not as much more as if it were equally split.
Also, what is "too large of a %" and how do you know? And if the product costs $X, but previously other competing products cost 7*$X, and as a result the company is many times the size it would be otherwise, and in turn the % the employees get is still an absolute amount far larger then it would have been anywhere else, now what? Rather then thinking about fuzzy "proper %" it seems better to investigate power imbalances, human limit edge cases, information asymmetry, cost externalization, etc., that affect the equilibrium of the system. Of which there are many!
You can't bake pies forever, no. But the stars are vast and many. That's yet another semantic stop sign: a phrase you say when you don't want to think about things any more, just like "it's not zero-sum".
The fact that we can "bake another pie" for 1/100 the resources is the definition of positive-sum. There is now more to go around. Even if previously the pie was perfectly divided but now of 100 pies 20% goes to whomever came up with the better way and another 50% goes to whomever financed the better way, the remaining 30% to the masses is still 30x the pie. I'm really not sure what you're confused by here, unless you're getting really lost in analogies.
Again: a basic definition of increasing wealth is increasing core abundance and efficiency. There can be more useful energy/resources to accomplish goals with, and there can be more efficient ways to achieve goals. Either or both combined mean there is genuinely more to go around. How best to distribute energy/resources remains very important, but does not change that having more and/or having it go farther means more wealth overall.
For the sake of simplicity, I'm just going to stick to the United States. As the previous commenter explained, the introduction of LEDs (along with cheap methods of manufacturing them) lead to much cheaper and more effective lighting. Undoubtedly there were companies and individuals that stood to profit quite a bit from these inventions. I don't know whether it helped create any billionaires, but certainly there are similar examples which have. On the other hand, although it created more wealth for those individuals, it created wealth for the entire country. Now every American has more money to spend because they don't have to spend as much money replacing their light bulbs.
In this case, the fact that some people gained much more wealth from this series of inventions is not a bad thing because everyone also benefited. In fact, the reason that inventions like this even come into existence is precisely because there is high reward for the individuals or companies doing so.
There are absolutely certain markets where things are much messier, but overall it's certainly not zero-sum. The issue is that many Americans do not have high enough wages or benefits to meet their family's needs. We should be working towards addressing poverty, not towards some moral tirade against billionaires.
Edit: I honestly can't express these concepts nearly as eloquently as xoa has in their comments, so I'd suggest referring to those.
"Imagine four people got all the food, and the rest got another 20%" is still imbalanced, even with 120% of the food. And there still would be violence. The problem is that the benefits of anything not zero-sum disproportionately accrue to the people who already have more than enough. And that simultaneously zero-sum resources also disproportionately accrue to the ones who already have so much.
It's not "playing a zero sum game" when you question why e.g. Bezos should accrue another $40 billion in net value, while hospitals struggle to provide PPE to their health care workers.
It's not "a zero sum game" if you ask why we have a world where somebody can hoard $150 billion while 800 million people need to go hungry every day.
Hugely disproportional resource allocation will break civilizations, zero-sum or not. (I'm fairly convinced that some inequality might contribute to a better society, but we've exceeded reasonable limits long ago)
The question is then, how do you measure efficiency. Proponents of a more equal world argue that the current extreme imbalance is only "efficient" for a very small subset of the population, and likely inefficient both for the vast majority, and for long-term success of societies.
The long-term question is basically a result of economies being feedback loops - if benefits accrue inequally, and capital results in opportunities, any system that doesn't have some negative feedback loops ultimately will amplify the inequality more and more.
In extremis, that means one person with all the resources. I'd argue that this is an outcome that probably nobody wants.
And in the context of OP: unless the total cake grows faster than the inequality, this holds true for non-zero-sum games, too.
The world has experienced tremendous growth in the past. It doesn't right now (and it can't sustainably continue growth in many areas), so the question is, what feedback loops do we want in place.
Yes, totally support this argument.
Most people advocating for rich people's existence is that they can more effectively utilize the resources and power. But they never tough upon the imbalance itself.
The imbalance has 2 aspects to it: * Utility: Does imbalance proclaims efficiency. * Morality: Is it moral to have imbalance.
Of ucz, both aspects need themselves to be balanced. I.e., we do encourage people with the obvious talent to enjoy imbalanced power and fortune. Like the young Steve Jobs, Bill Gates, and now Elon Musk. It is more utilitarian, and more moral to have these people enjoying more imbalanced power and fortune, then the older Steve, Bill, and Elon; in the sense, that when they are less talent, they should be pushed to be less entitled, and prefer a more moral position in the imbalance.
I mean, what Bill Gates does is not particularly more brilliant than a government directed research organization. Then why do we allow such a large fortune sit there without being spent for the people, after all, the fortunate was not earned by Bill the individual, it's a symbol of attribution through the capitalism system.
Places like Venezuela and Soviet Russia tried to distribute things equally and the richest people in those worlds had it worse than the 10th percentile in capitalist countries. This is why the Soviet Union had to build a wall to keep people in but the US is considering building a wall to keep people out.
Just
This system is a failure for everyone that isn't in the 1%
2. A stock price going up is not exactly getting "richer".
It's almost like capital ownership awards undue power that can then be used to further entrench power.
When the richest man in the US who happens to own the largest online shopping site and also uses his own newspaper to push more propaganda to push for more lockdowns - thus eliminating more competition from small businesses, is the richest man to be blamed or are the politicians listening to him and the people reading his propaganda newspaper and following orders to be blamed too?
When all the massive multi-national corporations that have questionable hiring, firing, healthcare, worker's rights, and safety track records promote and sponsor your cause and your Revolution has corporate sponsorship, you are not a revolutionary, you are a pawn.
It's just amazing how those who kept advocating for opening up small businesses and ending the lockdowns got called all sorts of names by the same people who complain about the rich getting richer.
Yes, the richest person on earth is absolutely to blame for the decisions he makes to hold on to his own power and wealth. Hope that clears things up
It is the fault of leadership, but the US leaders in particular seem to be an extremely wealthy bunch (or at least they claim to be). It seems to be the key attribute now.
There is a dire problem around the collapse of small businesses, but rich people usually get rich through capital markets rather than small business.
And "rich people usually get rich through capital markets" is just a fancy of way of saying they have ownership of everything and profit off of other peoples's labor
And yeah rich people own assets. That's like the definition of a rich person. Take your ax and grind it somewhere else.
This isn't some ax to grind. This is life under a system where the wealthy rule and the rest of us have no choice but to work for them or starve.
Honest question: compared to what?
* everybody has equal control of the nothing,
* no value → no economy → no economic decisions made for you by others,
* anarchy → no political decisions made by others
yet is clearly inferior to what we've got now.
I have zero problem with the cops stopping violent protestors. That’s a basic function of government.
Of course, the most "loyal" communists got the best land...
As always, the answer is in a healthy balance.
The question (the big one that America is super divided over) is which actor is better at allocating goods for public well-being, a billionaire who has proven (probably) they have good business acumen or the government that (ideally) exists to work for the benefit of the people.
I have my personal opinion but I wanted to neutrally (I hope) highlight that this is the heart of the issue.
Especially in the developing world, governments are more likely to piss away money given to them than to invest that money to the benefit of citizens.
If governments were good at investing money communism would have worked. There would be no point having companies like Apple develop cell phones if the government could do it just as well without enriching shareholders in the process. We’d just have a government agency in charge of building cell phones and giving them away or selling them to citizens at cost. We don’t have a private sector for funsies. We have it because we recognize that governments aren’t good at investing money and producing results.
I don't know which approach is better but I know that both roads contain pretty significant dangers and both contain benefits.
Additionally, I'm not particularly interested in going down a path towards communism - the leninist soviet system was an utter failure but germany and scandinavia seem to be doing pretty alright - in fact, on the topic of cell phones, Nokia started out in Finland which is a pretty heavily socialist country. I think there are a lot of options on the spectrum between 1637s Dutch Capitalism and Leninist Soviets - both extremes result in failure and, IMO, all centrist solutions are constantly being pulled toward the nearer of the extremes and need to actively work to stay from slipping into those dark places.
Yes, and Germany and Scandinavian countries are liberal capitalist economies where the means of production are predominately owned by the private sector. In fact, Sweden has more billionaires per capita than the US.
The west does know better. Not because they’re better, but because as a matter of historical accident they stumbled upon a set of winning ideas. Colonialism was bad. But that’s in the past. The choice people in former colonies are faced with is what to do now. And as someone from one of those countries, I think we’re fucking stupid if we reject the west’s winning ideas just because we’re bitter about colonialism. That’s cutting off your nose to spite your face.
People who talk about decolonization make me livid. I’d like to be able to take my kids to see Bangladesh some day without worrying about them getting sick from the water. Decolonization won’t do that. Capitalism, the rule of law, and liberal democracy will do that. I don’t care who came up with it first.
Governments routinely punish the poor for nothing more than being poor. In the US this is done through fees, penalties, licensing, direct taxation, and embedded taxes. Government routinely targets the poor for enforcement efforts because the officials know they cannot afford to fight back, hence why so much forfeiture in the US is of that class.
You can take all the wealth of every US Billionaire and not fix anything because the political class will not fix what is already wrong with their spending. More money just means more likelihood of more money spent wrong.
The only source of wealth that can pay for all the promises being made this cycle is from the middle and upper classes combined.
TWO TRILLION Dollars comprise Social Security, Medicare, and Medicade, tell me who giving them more will solve anything when they cannot care for Americans with two trillion dollars. Worse this is on top of state aid programs and programs coming out of another nearly 1.5 trillion dollars in various aid programs.
The choices are not just between concentrating an obscene amount of money with individuals vs concentrating an obscene amount of money with a handful of bureaucrats.
Why have a system that allows so much money to be concentrated with any kind of entity in the first place and put everyone else at the mercy of their philanthropy? MHO handing all that money to the government instead of a billionaire class is just changing from private trickle-down economics to nationalised ones.
As soon as your having someone deal with billions of dollars a couple thousands become a rounding error and your local concerns become benign, small picture issue. But for you having that 3000 available to finally fix that pothole on your street is critical.
Worker co-ops, taxes on municipal level and wealth taxes might be ways to prevent extreme concentration with any entity.
Let's imagine a scenario where 400 people each have $1, the average wealth is therefore $1 per person. If, however, we have 1% of people (4 in the same scenario) have $2 each, the overall wealth is still $1 per person on average, however the 1% would have $2 per person and the remaining 99% would have $0.99 per person. If we skew that a little more, let's have 50% of the total wealth ($200) in the hands of the 1% (again, just 4 people). The average for the population is still $1 per person, but the 1% now have $50 each and the remaining 99% have just over $0.50 each.
I get that this is an exercise in explaining what zero-sum is, something you don't believe this situation reflects, but it's important to recognize that people build wealth by acquiring it from somewhere else. If there was an infinite supply of money (there isn't), then we could have a conversation about this not being zero-sum. I don't think it's a good faith discussion to start with the assumption that money is infinite.
"There are 10^11 stars in the galaxy. That used to be a huge number. But it's only a hundred billion. It's less than the national deficit! We used to call them astronomical numbers. Now we should call them economical numbers." - Richard Feynman
Money is also the most fungible element of the economy. Given monetary policy, particularly the Fed's policies of the last decade or so, it is also not good faith to assume money as a constant.
Agreed. It's not constant and it's not infinite. The question then becomes at what rate does it grow and is that rate higher or lower than the stratification of wealth. If it's higher, it's either hyperinflation or wealth accumulation appears logarithmic in growth. If it's lower, it's either deflation or wealth accumulation appears exponential in growth.
It appears to be lower and wealth accumulation does, indeed, appear to be exponential. We're also completely glossing over just who it is that's likely to be wealthy and suddenly it's not just an economic issue, but a socioeconomic one.
Is it not true that when the books are balanced at the end of a period, wealth resulting from economic activity within the period ends up distributed among the public such that not every person does not end up with an identical amount? If so, is it possible to state this without simultaneously believing that economics is a zero-sum game?
A zero-sum game is one in which no strategy changes the amount of wealth available. There are clearly strategies that create or destroy wealth. Therefore, it's not a zero-sum game.
(This does not imply that every player has ever-increasing wealth each turn.)
>> Immediately, the author assumes that everyone is playing a zero-sum game, which is the root of the problem with his viewpoint: "We've got about 400 people in this room.... Imagine if dinner was carted into this room, and four people got half the food. The night would end in violence,"
"economics is not zero sum game", "correlation != causation", etc - certain ideas seem to be kind of like catnip for humans.
It was not that long ago (a year or so? Just when the trade war rhetoric with China was heating up) when "lolololll, economics is not a zero sum game!!!" seemed to be a satisfactory dismissal of Trump's issues with China's trade practices, both in the media and in forums. Shortly after, when the various media outlets seemed to all have a spontaneous change of heart on the matter and get onto the same page of noticing that there actually is a fair amount of complexity involved in international trade, and since then I've read very little "zero-sum" talk on the matter. Perhaps a media blitz on this issue might help illuminate more of the unseen complexity in this situation, although that scenario seems a bit less likely to me.
(The actual phrase comes from Jonathan Wallace, near as I can tell, but he was using it to talk about religion, not thinking in general.)
Would the other 396 look at the elite 4 in envy? Awe? Hate? Appreciation? Would they enjoy the 400 meals in a fairly equal way, or would they fight over allocations? Would the elite 4 encourage fair distribution of the 400 meals, or would they encourage in-fighting among the other 396, causing sufficient turmoil to distract the other 396 from organizing their own elite-and-profitable meals? There are a lot of scenarios that don't end in violence, even if a lot of people leave with a bad taste in their mouths.
I think it's a really interesting analogy, and it might even bolster the author's points about the importance of how elites behave and what systems they promote. It's too bad that the analogy was cut short with a reductionist assertion.
The government comes in and gives people who have little food, enough food. And of the food distributed, 70% of it comes from the top 50%.
If it was because they planted the crops, tended the fields, and did all the work to harvest and prepare it, I don't think any reasonable person would complain. We feel like that is a fair outcome because most nations have collectively agreed that owning property is a fundamental human right. In the US it's the 5th amendment.
That depends on whether they are starving.
Hence my point that this is a bad analogy.
1) I am certain there are laborers who get paid more than they produce.
2) Labor never takes the risk of providing capital.
> If it was because they [enslaved or underpaid people who] planted the crops, tended the fields, and did all the work to harvest and prepare it, I don't think any reasonable person would complain. We feel like that is a fair outcome because most nations have collectively agreed that owning property is a fundamental human right. In the US it's the 5th amendment.
All of a sudden it doesn't sound so reasonable and yet comes off a fair bit truer than the original.
However, I believe I've stated more than just slave labor. It's a very relative thing, but it appears many people are certainly underpaid compared to the wealth they generate for the few. It's starting to feel like people in tech believe otherwise because they're compensated better than average and therefore might be "above it all". I think that's alarming and short-sighted.
There wouldn't be violence. 396 people would say "forget this guy," and find somewhere that they could get food. People vote with their feet (and their wallet).
Shame has its function. Personally, I'm more worried about people who are proud to not use morals and are not hypocritical about it, than the do-gooders who put the bar higher than they can live up to.
Yes, they are more often hypocrites. That's great, you can point to that and expect some kind of feedback loop to have effect.
People without shame, who apply no morals to their deeds, are not to be applauded. I hope you agree when it comes to things like child beating. Now the questions is where to draw the line for cancel culture. Not if cancel culture is a 'bad thing'.
* Probably people load the word 'cancel culture' differently. I see it as pointing out morally bad behavior, and asking other people to also notice it, hoping there will be repercussions.
However, there is another problem: a “dark side” of people being willing to call others out on their shit. Clickbait.
It's surprisingly easy to make it seem like arbitrary person X is an evil evil person, regardless of whether they actually are. If you're familiar with person X, you might be able to spot a lie… but being universally sceptical will protect you from legitimate call-outs as well as fake ones. The average person has no real way of knowing, even if it's occurred to them that they might need to check.
So, yeah: overall, I think this is probably a good thing. But it's set back the lives of some good people.
(There's a rather simple way to turn this around: remove guilt by association. It should be okay to defend cancelled people. Defending bad actions doesn't need to be okay, but if it's costless to lie / “bend the truth” for social media clicks and costly to rebut them… calling people out on their shit becomes a much less useful force for good.)
Media and companies should not 'cancel' just because a group of people is demanding it, but it could be reason to look into something and then make up their own mind.
Wanted to rant on about lots more, but I'll let it go :)
It’s worth pondering whether the same (limited) perspective that caused several problems is sufficient to fix some problems without exacerbating others. The whole point of democratization of power is to distribute decision-making so people could make the right choices as locally apt.
Now of course we (the people) look at things differently so me going carbon negative (for example) may encourage others to pollute even more because hey u/kshacker is going to fix it so I know the thought process needs further evolution.
However I do also support creating a more functional market with enough room to enter so that other innovative, motivated entrepreneurs can effectively compete. That doesn't require some kind of destructive ground up rethinking or abandonment of capitalism. It requires a tweak - namely updated anti-trust laws that are actively enforced. This would achieve a different distribution of wealth and power while retaining the mechanisms we have in place to reward success precisely.
The richest three Americans have more money than the poorest 50% of Americans combined. However hard those three worked worked, there is no way that they worked harder than half the country. As COVID-19 has shown us, you don’t get far without the jobs we value the least. We need supermarkets open, bins taken away, rest homes cleaned etc. Wealth is further concentrating too, exacerbating the issue.
https://www.forbes.com/sites/noahkirsch/2017/11/09/the-3-ric...
https://www.mintpressnews.com/super-rich-see-wealth-rise-282...
Meanwhile, socialists like Giridharadas have done nothing but hold the country back, trying to keep us in poverty. Millions of children are dead because of the multi-decade detour socialists line Giridharadas took India and Bangladesh in during the 1960s-1990s.
while people complain about the disparities in income, its really the power to warp society in ones own favor that is dangerous
Out of curiosity what would you call China's mode of production?
See also: https://www.cato.org/policy-report/januaryfebruary-2013/how-...
China under Xu has more in common, economically, with say Korea under Park Chung-hee or Chile under Pinochet than with China under Mao.
Your point of reference for, "democratic capitalism," has half of it's period with outright slavery and the other half with brutal segregation and fascist violence through Klan lynchings. That's the good part in your eyes.
There’s some semantic argument here about whether there’s a causal relationship between democracy and legislation, but that’s missing the point.
Slavery in the U.S. was a democratic issue since its inception. Although Jefferson’s victory over the Federalists largely reframed the concerns of the voting populace away from slavery for most of the early 19th century, abolitionism eventually become an insurmountable movement. This movement had so much public support for and against it, that it grew into a civil war. I’m not sure how you can justify that it wasn’t democratic.
In developed countries, less than 1% of the population do that, if it's 50% of the population, it's a total game and climate changer
There probably isn’t even too much difference over the ages either. It’s just in America’s democratic-republic with capitalism the billionaires aren’t royalty.
https://twitter.com/ThomasSowell/status/1133792472063258627
I realize this is twitter and not a well developed thesis, but that just means twitter is a terrible platform to meaningfully engage in nuanced topics. It is a great platform for shallow thinking and insults, though, akin to the excuse, "I have a wonderful proof of this but the margin it too small to contain it."
So no, it's not just a bumpersticker retort. Growing up in a poor south asian country, I was taught to only care about the food on my plate and not be jealous of the food on someone else's plate. That made me work hard at putting more food on my own plate without being jealous and stealing from another's plate.
Any attempt to use the Christian bible to justify massive inequality is a bastardization of Jesus' teachings.
We're not talking about inequality in the sense that people deserve all the same things. Everyone deserves at least to be fed, housed, and taken care of when sick. A society capable of such but unwilling is disgusting.
Maybe you could debate to what degree we could provide for each other. We don't have limitless resources and capabilities. But certainly, we have the ability to provide everyone with clean water, food, and housing at this point.
Everyone who's willing to put a tiny bit of effort can get food and shelter thanks to food banks, shelters etc. Back in my country, we don't have that luxury yet but a lot of religious places are trying their best at providing that.
I am not religious myself but I do think they should play an important role at feeding those who don't have the resources yet.
Once your basic necessity like food and water have been solved, it's up to you to work your way up.
https://hub.jhu.edu/2019/07/18/hunger-and-obesity-jessica-fa...
https://www.bloomberg.com/opinion/articles/2019-07-17/how-hu...
Long story short is that a better concept isn't starvation, it's food insecurity. More than 10% of Americans are food insecure.
That’s a bad thing? I understand that eating healthy food is important, but if you’re obese, you should go hungry, that’s one part of losing weight.
Decent healthy food is not expensive. I have lived through it myself and plenty of us have.
The first is that politicians are selected by the rich. Since a Supreme Court Ruling (Citizens United), unnamed donors are able to give infinite money to political campaigns. So the rich buy the politicians and then the politicians decrease regulation and increase subsidies for the rich people's companies who elected them.
The second is that there is lots of aid and available resources but the government makes it hard to access this aid. Part of the government (the Republicans) doesn't want this aid to exist so they purposely make the administration of the aid very difficult to get. It becomes a full time job just getting free things creating a cycle of poverty and dependency. You can see the Republican party doing this with the US Postal Service right now. They mess up the program and then claim it doesn't work.
For America to improve, money must be eliminated from elections. We need a constitutional amendment to overturn Citizens United. Next, we must make programs simple and easy to obtain the benefit from. It shouldn't take multiple hours a day to get "free" food. This is why some people support the idea of a universal basic income. It would help the poor the most with the least amount of government overhead.
I do think this is an interesting topic. Effective altruism has lots of ongoing internal discussion about the efficacy of pushing for systemic change.
But I think the claims made in the article would have to be made a lot more substantive. See Scott Alexander's take here (https://slatestarcodex.com/2019/07/29/against-against-billio...).
Overall, I think parts of this approach might throw the baby out with the bathwater. Even if we do restructure the way that society works, presumably we'll still care about interventions to improve well-being. I think effective altruism (https://www.effectivealtruism.com/) has provided a lot of traction on how to think about these issues. Even if you disagree with their moral stance, I think it's hard to deny that people in the EA community have been very thoughtful about quantifying interventions and thinking about impact.
And I don't think these sorts of questions are going to go away, come a social restructuring. There seems to be a lot that we can salvage from the EA viewpoint, even if we decide systemic change is the way forward, and I think that's worth emphasizing.
The actual problem is social relations. The heir expropriates the surplus labor time of the worker. That is the real problem.
Wealth redistribution is, in a dialectic sense, a goal of those who own the most wealth. It is a goal set by this elite. Workers controlling our own labor time has been the clear goal of the worker's movement for at least a century and a half, if not longer.
As I read it, his main point is a valid one. If you want change, you have to participate in making that change. That participation is not limited to once every 4 year vote ( in US ), but rather an ongoing participation in society.
There are some valid criticism of this approach ( demoracracy doesn't scale well; it does work well on more local level, but you don't want to have a vote for every little issue ).
Still, his main point stands that elites should feel bad about their concentrations of power and that the link between money and political power should be weakened.
Read http://paulgraham.com/wealth.html for an explanation of what that is, and why it is a fallacy.
Folks on this thread seem to be falling over themselves arguing that billionaires are justified to even be billionaires at all.
The issue isn't that billionaires exist, its that billionaires have cornered all the decision making abilities of the public.
We _do_ live in a democracy (well, a republic -- in the USA). The government/legislature does seem, to a large extent, to be beholden to the wants of the immensely wealthy, but that's only because the electorate at large won't hold their representatives accountable for that behavior.
Despite having more resources and more leisure time than has been possible throughout most of history, people don't stay informed, contemplate policy, engage in activism, interact with their legislators ...
The laws of human psychology may simply not afford people people enough agency for a large democracy to be fair and effective.
Thinking for just a few minutes, there are so many facets and nuances to the issue of improving the world for others that the above sentence is a complete throw-away. One could get involved and sign up, but as the article already points out, how to know if the group you are joining is doing good or doing more harm? Did you join a group of virtue signallers or will you roll up your sleeves for Habitat for Humanity, or Doctors without Borders?
A couple of notions:
- How do you know if your effort is more like bailing water from a sinking ship, or, towing the ship into dry dock for repair? Maybe you have to bail at the same time you're towing.
- What is the actual goal? To ensure that people are able to eat today? Are you trying to right a wrong, like human trafficking or environmental crimes? Are you trying to create a level playing field so people are able to go as far as their determination will take them? If you want a level playing field, what system are you modeling?
The desire to do something is invaluable. I'd suggest two things: 1) keep it close to home. The farther the served are from you the harder it will be to see the results. If your aspirations are far from you, make it a goal to get there and see first hand what you're trying to aid, at least once. 2) Make it something where you can directly observe the results and know that your efforts are having a positive effect overall.
Violence is unethical. Half of the food is theirs who is the rest to take it away from them?
In a government managed system, you have a MASSIVE amount pooled resources controlled by whoever activated (or coerced) the most voters. What is the worst case scenario? Whoever is in power has a narrow list of buddies with businesses. Lucrative government contracts with little oversight on spending are taken to people who have some favor with the elected officials or their family members (and pay officials back in insider stock trading, or planned small stock dumps, or some other form of laundering). Money accrues to the family tree of those in power and those in power make all important decisions, eventually draining the country. Read the news in Eastern Europe for a while to see a live simulation.
Foundations. Anyone can start one, fulfill a mission, work to make the world a better place. A lot of foundations are doing a lot of good out there, so where does that model leak? With stringent requirement to hold no profit at the end of the day, worst case scenarios with foundations look like this: Similarly to government, the distribution of large quantity of pooled resources can go to the team running the foundation. In some, the executives collect whatever money is left at the end of the day (can't leave a profit after all). In others, a foundation on the side of a lucrative business gets the profits to reduce the tax burden on the business, but then distributes those to friends as contracts or generates sales from that business at increased margins, etc. How do you know this is happening? If you look at the ever increasing number of foundations, there are no incentives to create economies of scale in giving, despite the high fixed costs of running of foundation. Where are the foundation mergers that would make giving more efficient? Thus the tax incentives given by government can sometimes turn foundations south.
Where do Billionaires come in? A actually self-made billionaire has presumably lost the need to be corrupt. They have also proven themselves able to lead people to execute projects efficiently. The combination of resources, networks, and lack of misaligned incentives makes them more likely to focus on the impact of the work, than on self-enrichment with it. The down sides can happen if the original billions were a con-scheme and not actually acquired (Madoff), or if the billionaire is completely incompetent in the field they are giving in, or if they do it for the attention and ego boost, and social favors that may come from being asked for money. With all the attention paid to one person, however they can be more easily scrutinized than the other two models.
Please do feel free to contribute to this analysis tree.
I never saw any individual who are less qualified for an opportunity, where the inequality in opportunity cannot be fixed by strong social support in his or her earlier life through education and community.
It of cuz will be slow. But that's precisely the time scale we need to think about to make addressing inequality possible to start. I.e. we don't want Bill gates or Jeff bezos to think we want to deprive their personal fortune. Instead, we are looking for better ways to help them use the resources when they themselves lack the means or techniques.
One problem I see in pointing at the billionaires and claiming wrongs is it’s obviously an attack and puts them and anyone who feels they could be pointed at on defense.
Instead, point out how people are held back by the systems and positions of power.
When I had a particularly abusive management chain (4 managers for 9 workers) they could ask just about anything of me. The corporate policies gave them wide rights over even my personal liberties. For one, they could change my schedule at any time. Meanwhile, I could be lawfully terminated for varying my work schedule in excess of an 8 minute tolerance. That termination would mean all sorts of things - like owing back rent on an apartment I would have left - because I had no way to pay it. The way that particular industry worked, too, meant one termination likely meant I would never again work in that industry. That screams inequality to me.
Edit-That inequality has the effect of making any order my management gave me as a functional threat of my ability to maintain my very way of life. Without that job I would have been homeless shortly.
If you look at what these larger companies do, they embrace complex regulations.
Individuals and smaller businesses with innovative ideas cannot enter the marketplace because these complex regulations act as barriers to entry.
You can have a disastrous democracy and a neighbour dictator that mounts an attack and wipes your democracy off the face of the earth.
It's about competency, not political ideology. Until people get it in their heads that competency and science are two fundamental tools that move humanity where most people would unambiguously want to be headed, we are going to have an endless problem.
They call it corruption - it's just people who don't understand what moves the needle for them and others, resorting to moving the needle for them first, the rest maybe later.
That's what these Bill Gates and every other rich person in America is about - nobody has a unifying plan to move humanity forward, so they get rich and by the time they become rich, they've made friends with a bunch of other rich people. Now people like Anand come and say hey, you know all those friends you have? They're all doing bad things and you are too, you are bad.
What is rhetoric of this sort going to accomplish but separate us into us vs them even further?
Until people understand how to move the needle for most people including them, they will always resort to moving the needle for them and their family first and that is where we currently are.
If you want a different world - it has to come from a unifying message, not a message of blaming other people for your plight. This call for democracy is really a call for de-throning rich people and unless you want a dictator to come into power and start a civil war - this is not the rhetoric you want to promote.