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Income inequality is not the problem, it's a symptom

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Re: Income inequality is not the problem, it's a symptom

#61

Post by leaveyou »

[deleted] wrote: post #33
rayiner wrote: post #10

Mr. Garret quotes Sanders: > The reality is that for the past 40 years, Wall Street and the billionaire class has rigged the rules to redistribute wealth and income to the wealthiest and most powerful people of this country. I am rather puzzled that this idea gets so much traction. Does anyone really believe that if only the rules weren't "rigged" local shops and businesses would be able to compete against Wal-Mart a…

[deleted]

The tax code and it's loop holes designed for corporations and ultra-wealthy = bad rules. You "bait-and-switch" too.. pretending to care about fixing rules and making society better when you only care about billion dollar corporations that pay less taxes than the window cleaners working there.

Re: Income inequality is not the problem, it's a symptom

#62

Post by grecy »

RodericDay wrote: post #55
MrTonyD wrote: post #14

Earlier quoted context omitted.

It took me years to realize that economics isn't physics - and it isn't ruled by physics-like laws. Instead, economics is governed by laws created by our society. And what we think of as "free market" is really just norms of trade which are created by our society. There is no reason why the bulk of the billions taken-in by WalMart should go to the Walton family while their employees live on food-stamps - that is just…

Zizek phrased it kind of nicely once, in a way that stuck with me. He probably borrowed from somewhere, and I'll continue to lossily reproduce whatever the sentiment was, but it goes something like this. How is it possible that we are completely and utterly optimistic about breaking all sorts of physical barriers, like landing on Mars, and reusing rockets, and communicating worldwide via little handheld microcomputer…

>what's up with the bounds of our imagination? How come they're limitless when it comes to facing off against gravity, and completely defeatist when it comes to erasing class distinctions?

In my experience, that's only true in America.

People in Canada, Australia, England and Argentina and perfectly happy to discuss and debate ideas and ways to remove (or drastically reduce) class distinctions. Politicians even enact policy to do it.

I think the propaganda of "The Communists" has been drilled into the American public so solidly, it's not only un-American to suggest a change to the status quo, it's also considered utterly impossible.

Re: Income inequality is not the problem, it's a symptom

#63

Post by sokoloff »

gnaritas wrote: post #24
brbsix wrote: post #17

Earlier quoted context omitted.

The companies themselves don't really have any capacity to enforce these "rules", they have to petition the government to do so. The end result is regulatory capture. How do you expect to "force companies to give more of their earnings to their employees rather than filtering it all up to the top"? More government, I guess? We've seen how this goes.

As just one example, tax reform[1], punish companies with high gaps between their highest and lowest paid workers. It's quite easy to force companies to do things, you just change the rules. When a company does better, the benefits of that productivity should not all go to the top; the employees should share in the wealth they created. Companies who share their wealth with their employees would get more favorable tax…

Yes, and these incentives are likely to cause companies to use subsidiaries and contract workers, so that their employee count is lower and the median wage of those employees higher.

It's not clear to me that's a win for anyone other than consulting companies, tax prep and CPA firms.

Re: Income inequality is not the problem, it's a symptom

#64

Post by natrius »

> It is possible to address this problem without killing the golden goose. How? By rolling back some of the legislation that was put in place by undue political influence.

Using the political system to reduce the influence of money in politics is prohibitively difficult because the system is already captured by money. We should try, but we need other options when that fails.

When government stops responding to the wishes of the people, revolution is the typical answer. Luckily, we don't have to do that. We can end the influence of wealth on our politics without needing the government to do it for us.

Instead of trying to get the government to stop excess political spending, we should eliminate the incentive to accept excess political spending. People accept money to influence our democracy because they can use that money to get whatever they want from almost anyone, including you. You can't opt out because economic power is invisible. But we can make it visible, and give every individual the freedom to reject economic power that they feel is misused.

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

Re: Income inequality is not the problem, it's a symptom

#65

Post by codeismightier »

lisper wrote: post #57
[deleted] wrote: post #33

Earlier quoted context omitted.

[deleted]

> But the prescribed fix is to "raise taxes on corporations and the ultra-wealthy". Yes, as a first step. Then you use the proceeds to subsidize college tuition and health care to help level the playing field for young people, so they can get into the workplace with an education but without crippling debt. And then as a side-effect, the ultra wealthy will no longer have as much disposable income that they can use to…

You are right that it was a bad argument :). As such I've deleted the comment.

Re: Income inequality is not the problem, it's a symptom

#66

Post by [deleted] »

grecy wrote: post #53
puredemo wrote: post #51

Earlier quoted context omitted.

lol that is some pretty rosy thinking, I hope you're being sarcastic about the math on this.

I was being serious. Have a look at how things are done in Scandinavian countries, Australia, New Zealand. We have very few obscenely rich people in Australia, and we have no desperate people.

[deleted]

Re: Income inequality is not the problem, it's a symptom

#67

Post by millstone »

rubyfan wrote: post #45
UK-AL wrote: post #16

Earlier quoted context omitted.

Do you believe in property rights? Having a legal/police system to catch people who forcebly take property? Using trade to exchange property? This is the core of our system. And that system will always generate inequality. Not necessarily a bad thing. You can have laws to take the edge off inequality generated, but at the core of the system you can't really avoid it.

Clearly the parent does not believe in property rights when they believe unskilled non-differentiated labor should be rewarded with above market rates by force and at the expense of Walmart's shareholders. That individuals believe government should be directed at investors who risk their property to create wealth in order to take by force that property to redistribute it is perhaps the most offensive sentiment. > The…

I can think of about a million sentiments more offensive than the idea that people who invest should be taxed and that we should have a social safety net.

Re: Income inequality is not the problem, it's a symptom

#68

Post by cpursley »

If I could give away all my hn points and apply them as up-votes to this, I would.

The op explains very succinctly the problem in this quote:

> what is happening is that the ultra-wealthy are using their disposable income to buy political influence, then using that influence to get laws passed that allow them to collect rents.

My primary beef with American politics is the "solutions" are always in the form of bandaids - they focus on the effect, not the root cause. The recent healthcare laws are a prime example. How to handle the rise of ISIS is another. Both were caused, or at least compounded by misinformed short-sighted policy. The answer is rarely "more laws". Especially when more laws was what lead to most of these problems in the first place. It's like writing more code around terrible code when what is really needed is a total refactor and proper test coverage.

Ending cronyism is fairly straight-forward. But stacking on more law is only going to exacerbate the issue, because like the op explained - the well-connected are just going to buy more political influence and have the laws crafted to benefit them. Taxation is more complex. Increasing taxes is often a solution proposed. Fine, but first - the government needs to prove that they are good stewards of our money before reaching into my back pocket for more. Otherwise, that increase is going to end up as farm subsidies and in the pockets of "defense" contractors.

Re: Income inequality is not the problem, it's a symptom

#69

Post by ubernostrum »

UK-AL wrote: post #16
MrTonyD wrote: post #14

Earlier quoted context omitted.

It took me years to realize that economics isn't physics - and it isn't ruled by physics-like laws. Instead, economics is governed by laws created by our society. And what we think of as "free market" is really just norms of trade which are created by our society. There is no reason why the bulk of the billions taken-in by WalMart should go to the Walton family while their employees live on food-stamps - that is just…

Do you believe in property rights? Having a legal/police system to catch people who forcebly take property? Using trade to exchange property? This is the core of our system. And that system will always generate inequality. Not necessarily a bad thing. You can have laws to take the edge off inequality generated, but at the core of the system you can't really avoid it.

Do you believe in property rights?

As a useful legal fiction subject to the same limitations as others of its genus, sure.

As a natural moral right? Not in the slightest, because there ain't no such thing. The history of "ownership" of any given thing today is basically a history of force, fraud and the occasional lucky break. Who should own a piece of land? What moral claim do they have to it? The very best that can be said today is that they can trace a chain of transfers back to the person who most recently was able to stay on that land without being forcibly put underneath it by someone else. What kind of grounding for a supposed moral good is that?

So I believe in Thomas Hobbes' conception of the state of nature -- namely, that there are no rights, no virtues, no morals, nothing but all-out war for resources, where what is "yours" is what you can take and keep by violence -- and in his conception of government as what we introduce when we get tired of that, and that this arrangement is better than the "war of all against all" even though it comes at the expense of sometimes having the government decide that "my" property could be put to a better use.

Re: Income inequality is not the problem, it's a symptom

#70

Post by [deleted] »

cjy wrote: post #60

>The Baumol Effect, in case you didn't know, is the tendency of wage increases that come from increases in productivity to "spill over" into jobs where there have been no productivity increases. In other words, it's trickle-down economics under a fancier name. Mr. Garret gets the definition of the Baumol Effect more or less right, but then mislabels it as trickle down economics and proceeds to attack that. Here is an…

[deleted]
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