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My simplified response to Paul Graham's simplified essay

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Re: My simplified response to Paul Graham's simplified essay

#111

Post by edc117 »

natrius wrote: post #50

You've reframed the problem to wealth influencing politics, which still isn't something that needs to be fixed by taking money away from people. Redistribution is a decent solution to resource problems, but this isn't that kind of problem. Ending money in politics is hard to do using the levers of democracy since those levers have already been purchased, so I understand the desire to end extreme wealth instead. There…

This is a very interesting mixture of two ideas I hadn't really considered before. Has this been discussed or brought up here previously? Is the only real obstacle to this adoption? It seems like an extreme transparency, but the lack of a central authority while maintaining reliability is very compelling.

Re: My simplified response to Paul Graham's simplified essay

#112

Post by nitrogen »

bko wrote: post #96
tomp wrote: post #80

Earlier quoted context omitted.

There's inheritance and there's inheritance. I suspect most rich people don't actually inherit money/wealth (in the legal sense). Instead, they set up trust funds for the benefit of their families/children, and so protect the assets and avoid taxes at the same time. Also, with the sheer number of tax havens and offshore secret bank accounts available nowadays, I'm very sceptical that the official statistics are able…

Perhaps there are wealthy people that, through hidden inheritance, should be on the list. But what this article looks at is the Forbes 400 richest. Unless there are some Vanderbilts hiding somewhere with billions in offshore accounts, then I would say that inheritance is not driving inequality as much as you think. Also, you have to consider that inheritance is often passed on is often wasted in a few generations. >…

The most valuable forms of inheritance are the attitudes and connections of one's friends and family. The only way to stop that would be forced isolation/extreme desegregation.

That almost sounds like a plot for a Hollywood reboot of Ayn Rand -- "In a world where rich kids are forcibly distributed and forbidden from having rich friends, three teenagers find each other and, surviving their bizarre love triangle, start a mountain colony where rich kids can get together and par-tay."

Re: My simplified response to Paul Graham's simplified essay

#113

Post by adrianbg »

bko wrote: post #74
tomp wrote: post #10

PG's simplified essay seems like attack on a strawman; he's mainly arguing that inequality is good, but then mostly everybody agrees with that. The issue people see (and PG conveniently ignores) is increasing inequality - not locally increasing (i.e. an enterpreneur becoming rich because of a successful business idea), but globally increasing inequality, which happens because of rent-seeking, tax avoidance, buying po…

I say this over and over again in all my comments on the subject, but wealth passed on through inheritance has fallen a lot. I don't know why its always assumed to be true that all this wealth that's driving inequality is inherited. It's not true. > Over the past 30 years, the origin of the wealth of the richest people in the United States has shifted away from old, inherited money. Our new metric, the self-made scor…

Really interesting. I wonder how politicians would rate.

Re: My simplified response to Paul Graham's simplified essay

#114

Post by the-dude »

cmdkeen wrote: post #71
xbejdjched wrote: post #25

Earlier quoted context omitted.

It's worth keeping in mind that we do live in the propaganda bubble of the Soviet Union's arch nemesis. For their KGB, we had our J. Edgar Hoover. For their political purges, we had our House Committee on Unamerican Activities. For their later economic struggles, we had our great depression.

We never had several deliberately inflicted famines killing millions of people. In every single example you listed Communist countries were demonstrably worse. Humanity is capable of some pretty awful things under any system of government - Communism, or perhaps the way it comes about, has consistently demonstrated that itself better at enabling our worst impulses compared to democratic capitalism. That people, inclu…

How about your native population? And your police force is still shooting former slaves on a daily basis.

Re: My simplified response to Paul Graham's simplified essay

#115

Post by dgregd »

PG:"We will not do a good job of fixing the bad causes of economic inequality unless we attack them directly.

But if we fix all the bad causes of economic inequality, we will still have increasing levels of it, due to the increasing power of technology"

I still don't get what PG is trying to say.

For example few years ago Google and Apple bosses made secret agreement to not hire employees of the competing company. The goal was to transfer wealth from engineers to shareholders and bosses. There are a lot of other examples. That's why the essay had so much negative comments. PG should clearly condemn these practices.

PG:"we will still have increasing levels of it, due to the increasing power of technology"

That is just narrow VC point of view. Think about what cheap printing technology did for our civilization. There are countless of other examples. Today UK monarchy can only dream about the power they had.

I had a dream that the technology (Internet, DVCS ...) will make legislation process more transparent. Tax loophole? Just file a bug, propose a fix, vote for the fix. Think about what Stack Overflow and Github did for software development. Something similar can be done for the law.

Re: My simplified response to Paul Graham's simplified essay

#116

Post by bad_user »

joshhart wrote: post #46

There's one thing PG seems to implicitly which is that the movement from small company to large, dominating company in a vertical is a good thing. Ultimately startups seem to be producing winner-take-all companies. I do not believe this is a healthy thing for the economy or even rights of the consumer in the long run. There are a lot of services where if you do not like their terms, there may not be a great practical…

There are natural monopolies and there are government granted monopolies and personally I believe the later are doing more harm than the former. Historically technology has made natural monopolies obsolete, but technology cannot bypass the law. Because when that happens, new trade agreements can be made and the law can simply be changed.

If getting rid of monopolies is the goal, we could get rid of patents and copyrights, government granted monopolies which are about creating artificial scarcity.

Re: My simplified response to Paul Graham's simplified essay

#117

Post by vezzy-fnord »

jernfrost wrote: post #83

Great reply, although I disagree with the typical simplified assertions that the Soviet System didn't work. Without doubt the system had major flaws. But it is perhaps much more shocking that the system worked as well as it did given so many obvious problems with it. Taking a primitive peasant society and turning it into a space traveling civilisation was quite astonishing. One has to also keep in mind that for decad…

It's not as astonishing as you describe it. It's basic intuition that the relative growth of something will be greater in real terms the lower your starting point is. Robinson Crusoe finding a second stick to pluck berries with has doubled his capital structure and his output, but that's not particularly impressive. Starting from nothing, you can afford to just pump resources and treat the economy like it's a hydraulic system. It's what you do once you're up to parity that matters.

By all means, planning was inefficient. You had chronic surpluses and shortages. The attempt to replace profits and losses with "socialist competition" resulted in a disincentive to create surpluses, because it would quickly be integrated as a benchmark in the next Five Year Plan. This then resulted in the phenomenon of shturmovshchina where laborers would mostly idle and then expend massive crunches of labor during the final quarters.

The first seven years of Soviet rule were marked by massive hyperinflation. Wages were determined on a purely piece-rate basis, leading to workers toiling and factory managers manipulating quotas for greater wage returns. Attempted reforms under Khrushchev based on bonuses then only encouraged more homogeneity of production and made wage rates more volatile.

The reason Soviet planners could even calculate in a system of purely vertical transfers of resources was because of the establishment of the Comecon in 1949, piggybacking on Western price indexes. Kosygin introduced a reform in 1965 allowing some measure of profitability and sales, resulting in some growth but no movement in aggregate productivity because of the underlying Five Year Plan incentives. More radical reforms involving decentralization and minimization of bureaucracy in 1973 and 1979 were both rejected.

The Brezhnev era was marked by a large stagnation. Couple that with oil shocks affecting the key USSR exports, perestroika opening up the flood gates and the failed coup in 1991, the USSR was doomed to its failure.

It had nothing to do with Ronald Reagan or anyone "ending communism". It ended itself.

The Soviet system was a disaster and I can't imagine how anyone could say otherwise.

Re: My simplified response to Paul Graham's simplified essay

#119

Post by tomp »

chimeracoder wrote: post #101
efaref wrote: post #90

Earlier quoted context omitted.

According to this UN report: http://www.un.org/en/development/desa/policy/wess/wess_bg_pa... global inequality has been increasing despite convergence of inter-national mean incomes. The rich have been getting richer faster than the poor have been catching up.

> global inequality has been increasing despite convergence of inter-national mean incomes. This is a misuse of terminology. Generally when people talk about "global inequality" they are speaking either of median (not mean) incomes or median standard of living, (which is most accurately tracked by median PPP-adjusted incomes). The latter is more common in political and non-academic circles, because standard-of-living…

Meadian doesn't make sense when talking about inequality.

3 people having $1, $2 and $3 have the same "median inequality" as 3 people having $1, $2 and $300000000000.

You need either mean, range or quantiles.

Re: My simplified response to Paul Graham's simplified essay

#120

Post by adevine »

zepto wrote: post #18
tomp wrote: post #10

PG's simplified essay seems like attack on a strawman; he's mainly arguing that inequality is good, but then mostly everybody agrees with that. The issue people see (and PG conveniently ignores) is increasing inequality - not locally increasing (i.e. an enterpreneur becoming rich because of a successful business idea), but globally increasing inequality, which happens because of rent-seeking, tax avoidance, buying po…

Inheritance taxes on their own will do nothing to change the situation because then you'll simply concentrate all the wealth in corporate structures that transcend the death of their owners. Even if you make it impossible to 'pass down' these structures as property, you will have de-facto inheritance through nepotism and clan structures.

This doesn't make sense to me. At the end of the day, all stock must be owned by actual people, even if it is through a network of other corporate entities and trusts.

A corporation may transcend the death of its owners, but if I own 50% of a corporation, and I gift my shares to an heir (or even let them purchase it at a discount), the government will still take their cut.

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