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"There are no causes of poverty. It is the rest state..."

adamsmith.org

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Re: "There are no causes of poverty. It is the rest state..."

#41

Post by wanorris »

Hexstream wrote: post #28
mattmaroon wrote: post #12

Earlier quoted context omitted.

>>You'd be astonished at how many who start out with the Ferrari wreck it in short order and how many who start out with bricks become very strong because of it. Outlying cases are irrelevant. Of course people overcome the odds in both directions. But given equal driving ability, the Ferrari will always win the race, take the prize money, and buy their children a Ferrari. >>People who start out with wealth seldom cre…

">>People who start out with wealth seldom create wealth. What is the basis of that statement? Bill Gates was born to a very wealthy family." I'm pretty sure Bill Gates made more cash than he created wealth. Those are orthogonal concepts. It's possible to make cash without creating wealth or indeed, destroying it (ex: "successful" spammer that destroys the value of email). It's also possible to create lots of wealth…

> It's also possible to create lots of wealth without making money

Habitat for Humanity comes to mind.

Re: "There are no causes of poverty. It is the rest state..."

#43

Post by sethg »

wumi wrote: post #37
1gor wrote: post #26

The question is not what creates wealth but what keeps it unevenly distributed. There have been experiments (computer simulations) that tried to explain 'Pareto distribution' -- a power law distribution of wealth leading to 20 percent of population having 80% of the wealth. I refer to 1996 Axtell and Epstein book (google for Sugarcape). Basically, they created a number of software 'agents' and placed them on a landsc…

"The best and the brightest will stay poor unless they stumble on a resource which is not taken. (A new internet business idea for example)." Where does this data include for the fact that resources have been forcefully extracted from certain people groups for centuries? Need not look further than look at Central and South America, and the entire sub-Saharan African continent. (Also of course, several areas in Asia)…

The Sugarscape models are interesting because they show that you are likely have a "rich get richer" accumulation even when there is no coercion.

Re: "There are no causes of poverty. It is the rest state..."

#44

Post by bz »

When analyzing systems, we typically look for a transient response and the initial conditions. Extending this analogy, it would seem natural that even if we knew the characteristics of a system, the behavior of the system would be largely controlled by the inputs.

I'm not sure either element can be excluded when trying to solve this - my guess is that it's the need to fit things into our own frameworks and understanding that pushes people to grossly oversimplify.

Re: "There are no causes of poverty. It is the rest state..."

#45

Post by wumi »

sethg wrote: post #43
wumi wrote: post #37

Earlier quoted context omitted.

"The best and the brightest will stay poor unless they stumble on a resource which is not taken. (A new internet business idea for example)." Where does this data include for the fact that resources have been forcefully extracted from certain people groups for centuries? Need not look further than look at Central and South America, and the entire sub-Saharan African continent. (Also of course, several areas in Asia)…

The Sugarscape models are interesting because they show that you are likely have a "rich get richer" accumulation even when there is no coercion.

point taken, but surmising about how a society would operate in a fictitious world is a bit pretentious -- what real world value does that create?

Re: "There are no causes of poverty. It is the rest state..."

#46

Post by mattmaroon »

Hexstream wrote: post #28
mattmaroon wrote: post #12

Earlier quoted context omitted.

>>You'd be astonished at how many who start out with the Ferrari wreck it in short order and how many who start out with bricks become very strong because of it. Outlying cases are irrelevant. Of course people overcome the odds in both directions. But given equal driving ability, the Ferrari will always win the race, take the prize money, and buy their children a Ferrari. >>People who start out with wealth seldom cre…

">>People who start out with wealth seldom create wealth. What is the basis of that statement? Bill Gates was born to a very wealthy family." I'm pretty sure Bill Gates made more cash than he created wealth. Those are orthogonal concepts. It's possible to make cash without creating wealth or indeed, destroying it (ex: "successful" spammer that destroys the value of email). It's also possible to create lots of wealth…

I don't see how you could come to that conclusion. His products are in damn near every home and office in the first world. They helped bring PCs to the masses and make computing affordable.

Love 'em or hate 'em, his company is one of the most significant of modern times. He generated lots of wealth.

Re: "There are no causes of poverty. It is the rest state..."

#47

Post by astine »

sethg wrote: post #36
Retric wrote: post #24

Earlier quoted context omitted.

I create wealth by increasing efficiency and destroying jobs. I have made many people redundant and gotten them laid off. It's the name of the game hop from one useful skill to the next or become obsolete. I don't really care about these lost jobs but saying it's their fault that they become redundant is missing the point. Luck is a large factor in both the generation and retention of wealth. The risk of true poverty…

Yeah, skimming the Wikipedia article, it seems that they are classifying social-insurance programs like Social Security as "welfare", whereas most people would define "welfare" as programs that are specifically targeted to poor people. And one of the reasons Social Security is so politically secure--even at the height of the Dubya Administration's influence, a proposal to privatize it went down in flames--is that mid…

No one benefits from social security.The average payout is below the input.

Members pay so that more senior members may benefit and then hope that newer member will pay enough so that they may benefit as well. It functions like a large, mandatory pyramid scheme and only survives because people who have paid fortunes into it expect to be compensated.

Re: "There are no causes of poverty. It is the rest state..."

#48

Post by astine »

willchang wrote: post #10

If I were a criminal defense lawyer, murder would cease to be a crime. After all, there are no causes of death; it is the rest state, that which happens when you do nothing ... In fact there are plenty of causes of poverty -- war, corruption, disease, overpopulation, debt, ecological destruction, etc.

This is technically true, but I believe that it misses the point.

Death is the rest state. Which is why much more energy is spent in keeping people alive, rather than merely preventing death. That is, if you want to extend your life, you need to not look so much at the causes of death, as at the prerequisites for life. Getting food is more important than preventing murder.

The same is true with poverty. You can try to prevent war and corruption, but you won't eliminate poverty just by eliminating the impoverishing factors. You need to actually create wealth.

Re: "There are no causes of poverty. It is the rest state..."

#49

Post by sethg »

astine wrote: post #47
sethg wrote: post #36

Earlier quoted context omitted.

Yeah, skimming the Wikipedia article, it seems that they are classifying social-insurance programs like Social Security as "welfare", whereas most people would define "welfare" as programs that are specifically targeted to poor people. And one of the reasons Social Security is so politically secure--even at the height of the Dubya Administration's influence, a proposal to privatize it went down in flames--is that mid…

No one benefits from social security.The average payout is below the input. Members pay so that more senior members may benefit and then hope that newer member will pay enough so that they may benefit as well. It functions like a large, mandatory pyramid scheme and only survives because people who have paid fortunes into it expect to be compensated.

The benefit you get from Social Security is that if you retire before you die, if a spouse or parent who provides your family income retires or dies before you die, or if you become too disabled to work, you don't have to worry about outliving your savings, and you don't have to worry about inflation making your annuity worthless.

Re: "There are no causes of poverty. It is the rest state..."

#50

Post by Hexstream »

cstejerean wrote: post #33
Hexstream wrote: post #28

Earlier quoted context omitted.

">>People who start out with wealth seldom create wealth. What is the basis of that statement? Bill Gates was born to a very wealthy family." I'm pretty sure Bill Gates made more cash than he created wealth. Those are orthogonal concepts. It's possible to make cash without creating wealth or indeed, destroying it (ex: "successful" spammer that destroys the value of email). It's also possible to create lots of wealth…

About the only way to make money without creating wealth is to steal it from somebody else. Typically when somebody pays you for something you did, it's because they'd rather have your service or product than the cash they paid for it. Typically this means you created something valuable (or that the dollar is depreciating so quickly everyone's eager to get rid of it, but more on this later). The spammer created value…

"About the only way to make money without creating wealth is to steal it from somebody else."

Well. Let's say you have a company M that creates X wealth and has a monopoly. And then you have companies A, B, C, D, E and F that create 7x wealth but are driven out of the market by M's monopolistic practices. M indeed creates wealth, but the market is actually getting less than it would without it. It might not be called stealing, but I feel robbed.

Similarly, I'm pretty sure the value the spammer is creating for the companies they advertise for is largely offset by the value it's destroying for the masses of people they advertise to. Besides, the kind of "products" sold by "companies" via spammers is not exactly friendly neighborhood or good quality (if there's even an actual product at all).

edit: "Typically when somebody pays you for something you did, it's because they'd rather have your service or product than the cash they paid for it."

Sure, but maybe there's another service/product that could give you much more for the same money but you don't know about it because of propaganda (marketing, FUD) or simply because the company has been driven out of the market unfairly, as I said earlier.

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