Economic Inequality • Hacker News Board

Re: Economic Inequality

#361

Post by golergka » Sat, Jan 02, 2016, 10:14 PM UTC

jellicle wrote: post #298

golergka wrote: post #244

Earlier quoted context omitted.

> go back to the tax structure of the 1950s–70s”, with higher capital gains taxes Wouldn't it just push capital outside of US?

Just like the 1950s, which we all know were a disastrous time for US industry?

1) The capital is much more mobile now

2) If the US taxes in 1950s were lower, it indeed would make US an even more attractive place for capital. However, the US was going through an industrial boom because of variety of other factors then, unlike any other country in the world. Now, situation both in US and other countries is quite different, and tax factor is more important.

Basically, when you have the best goods on the market, it's OK to ask high prices, but when you get competition, it's not such a wise move to keep them high.

Re: Economic Inequality

#362

Post by srean » Sat, Jan 02, 2016, 10:16 PM UTC

civilian wrote: post #254

cko wrote: post #214

Earlier quoted context omitted.

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…

> Why do they have to "contribute to society"? This gets to the core of the question! How did a rich startup person get wealthy anyway? They built something that people wanted. People said: "hey, that thing you built, I value it at $20 and you're giving it away at $10, so I'm happy to buy it!" Anyone who made money from business has already created wealth and contributed to society, via the market. To the people who…

> Anyone who made money from business has already created wealth and contributed to society, via the market.

What in your opinion would be the contribution of a high frequency trader to a society or an individual ? Getting markets to be arbitrage less at sub-mili-second time scales was a pressing problem for no one.

For some of the other industries, if you price the externalities, it is far from clear if they are providing a benefit.

Re: Economic Inequality

#363

Post by edanm » Sat, Jan 02, 2016, 10:16 PM UTC

tonyedgecombe wrote: post #284

wtbob wrote: post #60

Earlier quoted context omitted.

> This is patently false: the best startups make money eating other people's lunch, and they concentrate this money in the hands of the founders. No, they concentrate the profits in the hands of their founders, but the big winners are the millions of consumers. Yeah, Jeff Bezos is rich, but not as rich as a world with Amazon in it

I don't feel rich when I live in a town with no bookshop, beyond a certain point the availability of cheap goods is pretty meaningless.

Unfortunately, that's not your decision. It's everyone's. You might personally dislike the choices other people make, but clearly other people do think saving money via buying at Amazon is worth it.

Re: Economic Inequality

#364

Post by Caprinicus » Sat, Jan 02, 2016, 10:20 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.

It's flawed logic because people only look at the reward end of the risk reward equation, even if the reward is potentially still higher nobody would bother instead of just taking a regular low risk job.

Re: Economic Inequality

#365

Post by natrius » Sat, Jan 02, 2016, 10:21 PM UTC

Futurebot wrote: post #231

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…

Even those in what remains of America's radical left don't make this argument (the few that do aren't taken seriously by their fellow leftists anymore); even in Europe, which is far more generous in terms of social welfare provision has some level of wealth inequality. So it's definitely a huge strawman. PG makes several statements which shows that he understands important parts of the problem (poverty, mobility), bu…

> Massive inequality in wealth breeds massive inequality in political power. No amount of mobility or opportunity can fix this one, only inequality reduction itself.

There is a solution besides inequality reduction. The problem is that our money makes the exertion of economic power invisible, so people have no way to reject its influence. If you don't want money to influence politics, you should be able to reject the power of money that has influenced politics over your own production.

I don't care how much money people have, but I do care when they use it to subvert our democracy. We can reject their power to do so, and we can do it without somehow passing a law through our government that has already become an instrument of entrenched economic power in itself. We can do it with individual action.

This is merit capitalism. http://meritcapitalism.com

Re: Economic Inequality

#366

Post by chroma » Sat, Jan 02, 2016, 10:22 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…

I don't think PG is attacking a straw man at all. In my career as a software engineer, I've run into a significant number of outright communists. Like most of us, they keep their political opinions to themselves most of the time. But occasionally, they let slip how they would welcome revolution. I don't want to name names or expose people who don't want to be exposed, so I'll just give one prominent example.

Steve Klabnik is an extremely talented programmer. He's a core developer of Rust and is the main author of The Rust Book[1]. He is also a communist. (Edit: This is not 100% accurate. Klabnik is better described as anti-capitalist. See downthread for details.) Don't take my word for it. He wants people to know this. Read his blog[2]. Look at his Twitter[3]. Judging from his follower count, he's not exactly alone in his opinions.

I wish you were right. Communists should be straw men. If there's any societal system that has been shown not to work, it's communism. That experiment has been tried so many times, in so many countries, with varying cultures, geographies, and levels of development... and not one of them was successful. Yes, capitalism has had failures, but at least it's had successes.

1. http://doc.rust-lang.org/book/

2. http://words.steveklabnik.com/an-introduction-to-economics-u... At the end: "…this post is basically my own little summary of Capital, Volume I, chapters 1-7, by Karl Marx."

3. https://twitter.com/steveklabnik

Re: Economic Inequality

#367

Post by clarkmoody » Sat, Jan 02, 2016, 10:26 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…

> pure common sense in a democracy

Does not exist. Democracy means that 51% of the people can destroy the life/liberty/property of the other 49% whenever they feel like it.

Re: Economic Inequality

#368

Post by coliveira » Sat, Jan 02, 2016, 10:27 PM UTC

cmurf wrote: post #163

wildmusings wrote: post #51

Earlier quoted context omitted.

> "More wealth than half the world's population" That's such a disingenuous statistic. A huge number of people, including a huge number of very well off people, have a negative net worth due to debt. I don't have a car payment or a mortgage, so I have more wealth than at least 30% of America, over 100 million people, combined! It's disappointing to see that FiveThirtyEight has now become just another outfit twisting…

This is a disingenuous rebuttal. The difference in wealth between someone worth $45B, and two people each worth $1 million and -$1million respectively, is identical. The millionaire is worth less than 0.01% of the first. If this were a card game, the millionaire could go piss himself. If it were possible to put $45B into a typical savings account earning 1% interest per year, that $45B person will make more money doi…

A practical problem of wealth accumulation is that it eventually becomes a moral hazard. If you have people with more $10B and a system of unlimited political contributions as in the US, they have so much power that it is difficult to maintain the democratic equilibrium. It is now known that the Koch brothers and Sheldon Adelson have more power over the republicans than the RNC, having elected hundreds of local and national politicians. In the left there is George Soros and a few others. Are we really willing as a society to give away so much political power to billionaires? I think a very practical solution is an extreme large tax on billionaires. There is no reasonable reason why a single person would like to have more than a billion dollars. This is practically an inexhaustible amount of money that should be considered as a practical limit. After that, you can happily pay 99% tax and enjoy making this country better.

Re: Economic Inequality

#369

Post by WalterBright » Sat, Jan 02, 2016, 10:27 PM UTC

throwupper247 wrote: post #330

civilian wrote: post #254

Earlier quoted context omitted.

> Why do they have to "contribute to society"? This gets to the core of the question! How did a rich startup person get wealthy anyway? They built something that people wanted. People said: "hey, that thing you built, I value it at $20 and you're giving it away at $10, so I'm happy to buy it!" Anyone who made money from business has already created wealth and contributed to society, via the market. To the people who…

Selling something that people want isn't equal to providing value. Let me be pessimistic: coffee doesn't provide a positive value, because it's a drug that get's people addicted however little and subliminal. Maybe that is a value to society in general, but it isn't to the individual. The car definitely is an economic nessecity in some parts. I don't know what refridgerator oligarchy you are refering to and it specif…

I love coffee. It is one of the great pleasures of life, like chocolate and strawberries. It provides positive value to me.

Re: Economic Inequality

#370

Post by bduerst » Sat, Jan 02, 2016, 10:28 PM UTC

clarkmoody wrote: post #367

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…

> pure common sense in a democracy Does not exist. Democracy means that 51% of the people can destroy the life/liberty/property of the other 49% whenever they feel like it.

It does too. That scenario typically leads to civil war and two democracies, at least for a period of time. Sometimes it works out, as with the U.S. democracy declaring that people are not anothers property.