Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video] • Hacker News Board

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#301

Post by lliamander » Mon, Oct 31, 2016, 1:13 AM UTC

ap22213 wrote: post #197

lliamander wrote: post #190

Earlier quoted context omitted.

> What's funny to me is that I have several neighbors who fervently describe themselves as pro-capitalist libertarians. Yet, when I'm out of coffee or I need my driveway plowed, they do it for free. Why is that? Probably because we are all friends and have common culture and mutual trust. I don't wish to presume anything about you specifically, but I find that your neighbor's behavior only seems paradoxical to those…

Excuse my ignorance, but how can one then have a concept of property without implying the use of force?

Fair question, the answer is that you cannot. However, note that I did not say libertarians reject all uses of force, only that "they would rather appeal to people's self interest to achieve social outcomes than resort to force".

I think we would both agree that the generosity of your neighbors represents the ideal. But if they weren't so generous, how you get them to share their coffee plow your drive way? Would you lobby for regulations to be passed to force them to stop hoarding their coffee? Have the police requisition their plow for the greater good?

Or would you offer to compensate them for their goods and services? And if they refused, would you peacefully resign yourself to some other means of getting your needs met?

The socialist often invokes the spirit of generosity with his rhetoric, but when others are (in his view) insufficiently generous, he is too quick to trade the pen for the club.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#302

Post by aminok » Mon, Oct 31, 2016, 1:26 AM UTC

drieddust wrote: post #279

aminok wrote: post #272

Earlier quoted context omitted.

Charging a fee for appropriating natural resources can be fully justified, but whether a fee is charged comes down to practicality. Example: it's not practical to charge every individual camper a fee for every piece of obsidian they find. While scarce, the amount of obsidian they stand to find and take is so small, that the cost of enforcing the tax would far exceed the cost to society of them depriving us of the nat…

> This hypothetical machine produces information. It's a computer. It sells computations. It is powered by solar panels that are on land that I'm renting from the government. I am glad you elaborated. So how this information is produced. In order to produce the information, you will rely on the works of centuries of collaborating between individual and groups. You will use that for free to produce value and then sell…

>I am glad you elaborated. So how this information is produced. In order to produce the information, you will rely on the works of centuries of collaborating between individual and groups.

That information is freely available. And making use of it and generating value for myself does not make me indebted to you and does not give you a right to use violent force to compel me to forfeit this share of my income that you think I owe you.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#303

Post by dredmorbius » Mon, Oct 31, 2016, 1:56 AM UTC

WalterBright wrote: post #164

dredmorbius wrote: post #159

Earlier quoted context omitted.

Currency, and currency-denominated assets (e.g., loans) are reduced in value by inflation. Real wealth -- land, plant, equipment, labour, intellectual capital -- are not currency-denominated, and are not affected by inflation. Invest in real assets (and avoid bubbles). You're inflation-proofed.

> are not affected by inflation But they are. Real estate taxes are based on value, which goes up with inflation. Some states (Oregon) tax all business property based on its value, which goes up with inflation. When you sell the real assets, the inflated value is taxed as "income".

Real estate taxes pay for services. They're indexed to land values, but generally with a multiplier. That value has as a predominant factor the earning potential of the land itself, though with a confounding factor of of land's role as an asset class, which, ironically, is inflated by not taxing land highly enough, according to cogent arguments.

All of those factors scale, more or less, with inflation. So your tax obligation should be keeping reasonable track with your earning capacity for that land.

If you can't afford to pay taxes on your land, then the problem, generally, is that you're squatting on valuable property that's better reallocated to a more beneficial use. If you're simply looking to squat and retire, head to the outback.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#304

Post by tome » Mon, Oct 31, 2016, 11:35 AM UTC

om2 wrote: post #188

tome wrote: post #81

Earlier quoted context omitted.

> How does it even make sense to compare these two quantities when they don't have the same units? They both have units T^-1, don't they? For example, they could both be measured in "Percentage increase per year".

It doesn't really make sense to take "percentage increase" as dimensionless, because it leads you to compare growth rate of incomparable things. One of the most basic rules of economics is that you can't compare stocks and flows. Why would it be meaningful to compare their % increase per year? Let's say that for construction company A, the total number of houses it has built increases by 10%. (This is comparable to a…

> Or to put it more generally, a stock growing at fixed rate grows linearly, but a flow that grows linearly implies a stock growing at a quadratic rate. O(N^2) will always outpace O(N).

I see what you're getting at, but surely you've got the rates wrong. A stock growing at a fixed rate grows exponentially, and O(exp N) will always outpace O(N^2).

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#305

Post by ap22213 » Mon, Oct 31, 2016, 1:36 PM UTC

aminok wrote: post #297

ap22213 wrote: post #275

Earlier quoted context omitted.

What evidence are you using to claim that laws against 'stealing' are one of the basic laws of society? I assume you mean after codified laws and surely after agriculture. And, probably post-enlightenment, right? But, at that point, laws are no longer 'basic laws of society' but laws of the sovereign - to maintain their power and control. And, interestingly, the soverign is the only one allowed to steal. I'm suggesti…

>What evidence are you using to claim that laws against 'stealing' are one of the basic laws of society? Maat: https://en.wikipedia.org/wiki/Maat#42_Negative_Confessions_.... >42 Negative Confessions (Papyrus of Ani)[edit] >1. I have not committed sin. >2. I have not committed robbery with violence. >3. I have not stolen. >4. I have not slain men and women. >5. I have not stolen grain. Babylonian Law: http://avalon.l…

Makes sense. So, the only fuzzy part seems to be: what is property, and I guess that's up to social norms?

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#306

Post by wyager » Mon, Oct 31, 2016, 3:10 PM UTC

ryandrake wrote: post #185

wyager wrote: post #69

Earlier quoted context omitted.

The fundamental premise of your argument - that investment "isn't productive" - is entirely wrong. Investment is what provides capital for growth.

If I buy stock in Company X, it doesn't go to Company X, it goes to some other dude who sold me that stock. How is that "providing capital for growth"? It's a casino.

Who do you think sold that stock in the first place? Company X, to raise capital. If there weren't people willing to buy company X stocks in he future, they would be unable to sell them when they needed capital.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#307

Post by 21echoes » Mon, Oct 31, 2016, 4:23 PM UTC

witty_username wrote: post #210

21echoes wrote: post #181

Earlier quoted context omitted.

> Ignoring [the mental state of the people being optimized for], what is wrong with inequality between groups? A bit cheeky, I know, but I don't think you can just write off emotional results of systems. But to answer in better faith: I think [Rawls's Veil of Ignorance thought experiment]( https://en.wikipedia.org/wiki/Veil_of_ignorance ) is a good response here. In short (skipping how he arrives at the conclusion):…

Then the issue is poverty and not inequality. If tomorrow everyone else had 1 billion real dollars and I had the same real dollars as now; it doesn't affect me.

...which is why I spent my entire last paragraph discussing why addressing inequality is often considered as a way to tackle inequality. We don't get to pretend they're separate things for at least another few centuries.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#308

Post by aminok » Mon, Oct 31, 2016, 11:27 PM UTC

ap22213 wrote: post #305

aminok wrote: post #297

Earlier quoted context omitted.

>What evidence are you using to claim that laws against 'stealing' are one of the basic laws of society? Maat: https://en.wikipedia.org/wiki/Maat#42_Negative_Confessions_.... >42 Negative Confessions (Papyrus of Ani)[edit] >1. I have not committed sin. >2. I have not committed robbery with violence. >3. I have not stolen. >4. I have not slain men and women. >5. I have not stolen grain. Babylonian Law: http://avalon.l…

Makes sense. So, the only fuzzy part seems to be: what is property, and I guess that's up to social norms?

Ultimately every conception of rights is subjective, but property is generally recognized as that which we acquire through First Possession (a principle observed throughout the Animal Kingdom), and Homesteading (taking unclaimed natural resources and reconfiguring them into a more valuable resource).

First Possession at least has been shown in Game Theory simulations to lead to stable equilibriums, so it's not surprising that property rights are so widely observed. I think observance of the Homesteading principle naturally emerges from observance of the First Possession principle.

Where it gets fuzzy, in my opinion, is property rights over natural resources like land, which derive almost all of their value from their natural form, rather than the value done to them by their original appropriator.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#309

Post by therealdrag0 » Mon, Oct 31, 2016, 11:42 PM UTC

nathan_f77 wrote: post #158

Serious question: How much more information do you typically retain by reading all 696 pages, versus watching a 20 minute summary? The linked webpage talks about that, saying that it needed to be condensed into a TED talk because the book scared of many people (myself included). But for all the prodigious evidence, how much do you really remember? Does any of it come up in conversation at a dinner party? > Piketty pr…

I listened to it on Audiobook and definitely didn't retain crap. But it's interesting. There were a lot more moments of "pause and reflect" probably listening to tens of hours of audio-book instead of a 20min video.

Re: Thomas Piketty’s Capital in the 21st Century, in 20 minutes (2014) [video]

#310

Post by eru » Tue, Nov 01, 2016, 9:37 AM UTC

ebalit wrote: post #78

eru wrote: post #59

Earlier quoted context omitted.

Capital and land are different: you can make more capital to compete against existing capital, you can't really make more land.

Capital is used as a synonym of wealth. It's a book about wealth inequality. The book was originally written in French, and land is considered as "capital foncier". Maybe this meaning got lost in translation, but I think "capital" also has the "wealth" meaning in English. Nevertheless, the point I was making still holds. The Medium post isn't a refutation of Piketty's theory.

Yes, that confusion is a decent enough explanation. The important thing I want to highlight, is that as factors of production go, increasing returns to land have different policy implications than increasing return to capital:

A general wealth tax might be required if capital was actually the problem; with all the economic inefficiency that implies. I don't know for sure.

But increasing returns to land have a simple solution: a land value tax, with no negative impacts on economic activity, since supply of land is perfectly inelastic, since land is basically fixed in abundance.

(To forestall a common argument: that the Dutch are converting some of their land from below the sea level to above sea level doesn't change matters.)

We are fortunate to live in a world where Georgism applies, ie taxation to finance a welfare state doesn't have to impact the economy at all.