Economic Inequality • Hacker News Board

Re: Economic Inequality

#241

Post by samastur » Sat, Jan 02, 2016, 8:13 PM UTC

tomjen3 wrote: post #204

samastur wrote: post #187

Earlier quoted context omitted.

You are welcome to try to eat and drink through tens of millions of dollars, but I doubt you can do it. Even if you can, there will be a lot of happy waiters and cooks serving you ;)

And you don't think the mechanics, aviators, etc who keep the billionaires flying are happy to have jobs now?

Sure they are, but that was not the argument I was half-jokingly making.

What I was saying was that you can't hide meaningful amount of difference in tax rates between then and now in business lunches (which to the best of my knowledge are still around).

On a more serious note though I would consider the law of diminishing marginal utility and its impact on economic activity.

Re: Economic Inequality

#242

Post by nhaehnle » Sat, Jan 02, 2016, 8:15 PM UTC

pandaman wrote: post #66

jrlocke wrote: post #13

Earlier quoted context omitted.

Exactly. There would still be sufficient economic motivations for startups and startup founders in a world where startup founders were taxed at a 75% rate.

I hear this from liberals all the time, often in more extreme form of "even if only a cent of a million is left there will be motivation to make that million!". But wtf are you so sure? I for one am not looking for a smaller bump in salary at 50% tax already as I don't see how additional effort would pay for itself. I imagine a lot of people don't consider an effort to found startups at this rate too.

Trying to put in the effort to get a bump in salary is very different from the kind of creation that is the main benefit of startups to society.

To counter your anecdote with another one, if only half of the characterization of Steve Jobs is true, do you really believe the exact amount of potential financial upside was ever really a question for him?

Sure, if the economic environment had been so extremely bad as to make it impossible to make a living off founding Apple it's likely he would have gone somewhere else. But that's a strawman and you know it.

Re: Economic Inequality

#243

Post by hammerandtongs » Sat, Jan 02, 2016, 8:15 PM UTC

dang wrote: post #224

hammerandtongs wrote: post #160

I LOVE that Paul Graham posted this just a day after posting Mark Twain's "corn-pone opinions" with no sense of irony or self awareness. """ "You tell me whar a man gits his corn pone, en I'll tell you what his 'pinions is."... The black philosopher's idea was that a man is not independent, and cannot afford views which might interfere with his bread and butter. If he would prosper, he must train with the majority; i…

The all-caps sarcasm here seems predictive of the complete factual inaccuracy of what follows. PG posted the Mark Twain article in 2004.

Citation needed.

Your quibble over the precise date of the post seems predictive of an inability to deal with the larger points raised.

Re: Economic Inequality

#244

Post by golergka » Sat, Jan 02, 2016, 8:15 PM UTC

jacobolus wrote: post #8

Graham is arguing against an enormous straw man. Nobody is suggesting that we “prevent people from getting rich” or “end all economic inequality”. The most extreme proposals I’ve seen in America are ones like, “institute an unconditional basic income as an alternative to means-tested welfare programs,” or “allow every citizen/resident into a single-payer healthcare system,” or “go back to the tax structure of the 195…

> go back to the tax structure of the 1950s–70s”, with higher capital gains taxes

Wouldn't it just push capital outside of US?

Re: Economic Inequality

#245

Post by dang » Sat, Jan 02, 2016, 8:18 PM UTC

throwaway2048 wrote: post #193

obrero wrote: post #37

Robert Morris and Paul Graham are criminals. Morris crashed a large portion of the Internet in 1988. There is a large amount of evidence Graham had foreknowledge of this worm, which was presented in court. How much jail time did Morris do? Nothing. I don't think Graham was even charged. This is what inequality is. I know people who were arrested for hacking in early 1990, with less evidence, less destruction etc. But…

This post uses some inflammatory language, but people should really think about what its saying before they flag it. Being rich and connected is extremely likely to be why PG never ended up in jail and went on to create YC and this website. Consider what other people that get written off by society for being poor or lacking connections or being criminals could have contributed. A world where nearly everyone is relega…

When people post that sort of personal/political fantasy attack, it says nothing about the target, only something about themselves. I'm glad to see it flagged on HN. The purpose of discussion here is to sincerely seek the truth, not crush enemies or vent resentments.

I agree with you that people written off by society have valuable contributions to make. That's a big deal. But the binary thinking in your comment and the GP doesn't pertain to that—it's just projection, which always leads to false imaginings. For example, PG wasn't rich thirty years ago.

Re: Economic Inequality

#246

Post by Futurebot » Sat, Jan 02, 2016, 8:19 PM UTC

cko wrote: post #214

xiler wrote: post #102

Earlier quoted context omitted.

There's nothing wrong with someone getting rich provided they contribute a proportional amount of value to society. Problem is that since the post-WII period (also called the Golden Age of Capitalism) such rewards have been happening less and less [1,2]. In fact, I think reducing inequality is essential for promoting productivity. [1] https://en.wikipedia.org/wiki/Post%E2%80%93World_War_II_econ... [2] https://upload.…

But is it wrong for a rich person to hoard wealth, or to spend only on luxuries for themselves? Why do they have to "contribute to society"? I'm by no means wealthy, and at my age of 29 I've donated more money than many of my coworkers. And I'm all for a portion of tax dollars supporting the underprivileged. But when I read about Larry Ellison's yacht-racing hobby, I think to myself, "good for him." He can spend his…

That's not the argument. The "contribution" is through taxes to the society that enabled them to get rich in the first place. Sure, some people are upset about obscene displays of wealth (though in today's America, those people don't seem to have much of a voice), but by and large, no one begrudges rich people from enjoying themselves (this is America, after all. We love our rich people as a rule, even when some of them are terrible people individually.)

We do begrudge people avoiding taxes, buying legislation and legislators, funding think tanks that support only the interests of the wealthy, and blowing up the financial system and/or economy.

Re: Economic Inequality

#247

Post by mikeash » Sat, Jan 02, 2016, 8:20 PM UTC

rayiner wrote: post #240

GavinMcG wrote: post #33

Earlier quoted context omitted.

On that note: the most offensive economic inequality isn't the 1% vs. the 99%, which successful startup founders would find themselves on the wrong side of. It's more about the 80 individuals with more wealth than half the world's population [1] – which, yes, does include "startup founders" such as Gates, Ellison, Bezos, Zuckerberg, Page & Brin, etc. But the vast majority of successful startup founders aren't in this…

I disagree. Those people having a lot of wealth doesn't affect ordinary people much at all. The inequality that affects ordinary people is the kind that drives up housing prices and drives out long-time residents, or those that bid uo healthcare or educational costs. The thousands of Facebook employees making six figures contribute more to inequality in practice in their communities than Zuckerberg.

At that level it ceases to be about things like housing costs, and starts to be about how the whole country is run. Wealth brings power. Look at that list and you'll see a lot of people who are screwing with the political system for their own benefit.

Re: Economic Inequality

#248

Post by wildmusings » Sat, Jan 02, 2016, 8:20 PM UTC

geofft wrote: post #146

wildmusings wrote: post #127

Earlier quoted context omitted.

In a capitalist system, you become wealthy by creating value for people in mutually beneficial and consensual transactions. Tax discourages that kind of value creation. You can try to hide this effect by using really large numbers (they'll still have $500M!) but that's deceptive because, even if their motivation wouldn't have been affected (which I disagree with), these uber-wealthy people are the exception, not the…

I think the case for their motivation being affected makes sense in a physical-goods economy. If a woodworker sells $500M of chairs, sure, there's suddenly much less motivation to spend the same amount of parts and labor on the next chair for 1% of the profit. But for other kinds of revenue that makes less sense. The 5 millionth copy of Windows does as much good for that particular customer as every previous one, at…

Analogies aside, there is a moral component here. Everyone has a moral claim to the fruits of their labor, however rich or poor they are. You need some amount of tax to pay for our collective defense, police, courts, and mandatory education, but much more than that is immoral. Remember what taxation ultimately is: the police coming to your door and picking your pocket at gunpoint. It rarely comes to that, but that's fundamentally what separates it from voluntary charity.

The "soak the rich" approach is immoral in my book. Any discourse that doesn't consider the moral angle to these issues is incomplete.

Re: Economic Inequality

#249

Post by gkop » Sat, Jan 02, 2016, 8:21 PM UTC

supercanuck wrote: post #229

gkop wrote: post #168

Earlier quoted context omitted.

The philanthropy point is not to be missed. The perception of Silicon Valley super rich people by the rest of the USA is that they are more stingy with their wealth than respected entrepreneurs in other industries. SV super rich are perceived to punt forever: "If I invest my $100M rather than donate it, then I can grow it to $500M and donate half of that, $250M! See, everybody wins." But then they never do end up act…

I think it has more to do with the "I built Facebook" and therefore I am capable of solving "world hunger", when there are people out there who dedicate their lives to the the task but lack resources. It is incredibly arrogant, in my opinion.

Indeed.

PG's audience is start up people, so his message here is in part "You shouldn't feel bad about pursuing or having massive wealth". Of course this message is true. But it should probably be accompanied by a message like "But don't be an asshole, give a large amount of your massive wealth away to noble causes".

Re: Economic Inequality

#250

Post by ranprieur » Sat, Jan 02, 2016, 8:22 PM UTC

Economic inequality is harmful when it results in centralization of power, where decisions are increasingly top-down and made by a smaller number of people who are more out of touch because they're more insulated by wealth. This leads to bad decisions, and unhappiness among the increasing number of people who sense that they have no meaningful participation in society.

"Can you have a healthy society with great variation in wealth?" Only if there is no great variation in power, and this would require redefining wealth as something disconnected from power, like consumption of luxuries.