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Economic Inequality

paulgraham.com

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Re: Economic Inequality

#421

Post by ebfe »

enraged_camel wrote: post #164
11thEarlOfMar wrote: post #141

Earlier quoted context omitted.

> They usually try to shape the world around them Least of which are: Bill Gates: http://www.gatesfoundation.org/ Warren Buffet: https://nonprofitquarterly.org/2013/07/09/buffett-makes-his-... Mark Zuckerberg: https://www.facebook.com/chanzuckerberginitiative/

Counter-point: wealthy bankers and hedge fund managers caused the 2009 financial collapse and none of them went to jail because it's not feasible for politicians to go after their campaign contributors.

Which banker should have gone to jail, and for breaking what law?

Re: Economic Inequality

#422

Post by Aleman360 »

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…

> They built something that people wanted.

What about people that produce heroine? Run casinos? Magic weight loss pills? Free-to-play games?

Re: Economic Inequality

#423

Post by zo1 »

funtimes32 wrote: post #232
RobertoG wrote: post #121

Earlier quoted context omitted.

I really don't see your point. Piketty shows (with data, by the way) that, below a percentage of economic grow, capital returns are bigger than labour returns. The conclusion is that there is a trend (very important, it is a trend) to bigger inequality inherent to the system. What do he propose? A communist revolution? The abolition of inequality by the proletariat? No, just tax capital so we can redistribute it to a…

How does one tax capital?

I would guess they calculate some amount of tax that you have to pay based on how much capital you have. And you keep paying it until you go below some magical threshold. Or, you don't pay and they just take it from you.

Of course, a bit trickier if you don't have capital, but rather have plenty of tangible goods. In which case, they'd probably ask you to submit your "profit and losses" for every year, keep track of how much you made in each year, and start taxing you based on anything that means your running total goes above the magical threshold.

Re: Economic Inequality

#424

Post by makomk »

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…

No, they didn't get wealthy merely by building something that people wanted - if you just do that, other companies will offer the same thing and the market will drive down the price to just above the cost of production. This is how the free market is meant to work and it's what makes it (in theory) an efficient way of allocating resources. In order to get truly wealthy you need to find some barrier to entry, some way of ensuring that you can avoid the free market and its drive for efficiency. It could be network effects, which ensure that competitors to sites like Facebook and eBay won't succeed because they're useless unless everyone's already using them. It could be software lock-in and patents of the kind that drove Apple to be one of the richest companies in the world. It could be information asymmetry that causes people to choose your well-known brand over cheaper but better products because it's too expensive for them to assess the actual quality of what they're buying. But there has to be some barrier, some way of defeating the free market.

Re: Economic Inequality

#425

Post by zo1 »

whistlerbrk wrote: post #270
wtbob wrote: post #103

Earlier quoted context omitted.

> Amazon or Walmart, on the other hand... Some of these disruptive industries make a lot of people poorer by driving businesses into bankruptcy. Amazon and Walmart make the poor richer, because they need spend a smaller proportion of their incomes on food & goods. That's why Amazon & Walmart out-competed the mom-and-pops of a generation ago. This was bad for the owners of the mom-and-pop stores, but it was good for t…

I cant believe you're serious. People didn't vote with their dollars. They needed to eat so they sacrifice the long term for the short. companies like Walmart are able to leverage their miniscule effective tax rate compared to mom and pop stores to offer cheaper goods, combined with the FACT that they artificially lower prices to a point where an individual store loses money all for the sake of driving the local comp…

>"They needed to eat so they sacrifice the long term for the short."

And they would not have had to sacrifice if they went to the "mom and pop stores" instead? You're not really addressing the point of Walmart actually being cheaper than the mom and pop stores, and thus got more sales. Precisely leading to what the OP said of poor people voting "with their dollars".

>*"Walmart has innovated in logistics and supply chain management[...]"

Exactly how they made life easier for the poor, by transferring enough of the cost-savings from the efficiency to both undercut the wasteful mom and pop stores, and to save the poor customers money.

Re: Economic Inequality

#426

Post by narrowrail »

hammerandtongs wrote: post #291
dang wrote: post #271

Earlier quoted context omitted.

https://news.ycombinator.com/item?id=10822640 Since you used the date to falsely justify an ad hominem—the polar opposite of a "larger point"—it's not a quibble how wrong you got it.

Ad hominem doesn't quite mean what you suggest. The two postings are directly related and not an attack based on his wearing of red shirts on thursdays. From the wikipedia """Ad hominem reasoning is not always fallacious, for example, when it relates to the credibility of statements of fact or when used in certain kinds of moral and practical reasoning.[3]"""

I think part of the point is that pg didn't "post" these to HN himself at all. Someone else submitted a blog post from pg from 2004, and then someone else submitted this recent blog post. In other words, the author of the posts didn't submit them for discussion on HN at all, counter to the insinuation you appear to have made.

Re: Economic Inequality

#427

Post by Futurebot »

patrickaljord wrote: post #419
Futurebot wrote: post #413

Earlier quoted context omitted.

Those aren't the only two choices. The west, and even many in the east, are made up of mixed economies. Denmark, Finland, Sweden, Germany, and many others are extremely successful mixed economies by most measures (see OECD stats to start.) In the US, the mix is currently wildly out of whack; it needs to move back towards broadly shared prosperity, rather than the oligarchy we have now. That means higher taxes on the…

I live in France, I can tell you that most of the countries you list here built their wealth before building their huge welfare state and that it's now turned into a money losing machine nightmare which are being urgently reformed as you read this. It's also turned people against one another and created more racism for a simple reason. Given that the welfare state takes money from people and redistributes it to other…

Welfare discouraging work has largely been refuted: http://www.nytimes.com/2015/10/21/business/the-myth-of-welfa...

Where it does discourage work, the effects are extremely minor. Your contention that their wealth was before the welfare state is completely incorrect and ahistorical. Even the crudest measures show that to be wrong. Examples:

http://www.tradingeconomics.com/denmark/gdp

http://www.tradingeconomics.com/sweden/gdp

For France, the numbers since 1960 have been fantastic overall. Look through the OECD measures:

https://data.oecd.org/france.htm

I'm sorry, but your statements don't hold up to any of the measured data, and this excludes things like perceptions of corruption or gross happiness. No country is perfect, but the ones I listed are doing better than the US on almost every internationally recognized measure.

Re: Economic Inequality

#428

Post by makomk »

wildmusings wrote: post #269
notahacker wrote: post #253

Earlier quoted context omitted.

On a global scale, this is nonsense. The number of people globally who have negligible net worth because they earn less than $10 per day vastly exceeds the number of people who have negligible net worth because they've only just started paying down the mortgage on their McMansion and still have student loan repayments remaining. The purchasing power of those 80 people isn't going to start looking insignificant if you…

I disagree. If you take the 3 billion poorest people in the world and properly account for their future earnings, it will certainly exceed the combined expected wealth of these 80 billionaires. You couldn't have anything close to this sensationalist statistic. Also, global poverty is not the fault of Western riches. It's not something we (Westerners) can do anything about either, except engage in mutually beneficial…

And how much of those future earnings will go right back into the pockets of the mega-wealthy through rent and interest payments and profits on goods that they buy from companies owned? Nearly all of it, I'd imagine.

Re: Economic Inequality

#429

Post by icebraining »

Aleman360 wrote: post #422
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…

> They built something that people wanted. What about people that produce heroine? Run casinos? Magic weight loss pills? Free-to-play games?

The people producing heroine are mostly poor farmers, not rich startup guys. And magic weight loss pills are simply fraudsters, nobody defends those.

As for casinos and F2P games, what about them? Certainly some people get hooked, but 95% of casino players don't[1], yet they still enjoy it. What's wrong with that?

[1] http://www.pbs.org/wgbh/pages/frontline/shows/gamble/etc/fac...

Re: Economic Inequality

#430

Post by stefantalpalaru »

> If one woodworker makes 5 chairs and another makes none, the second woodworker will have less money, but not because anyone took anything from him.

Are you sure? What about that limited supply of high quality wood required to "create wealth" by shaping it into chairs?

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