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A Guide to Statistics on Historical Trends in Income Inequality

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Re: A Guide to Statistics on Historical Trends in Income Inequality

#121

Post by jahaja »

fixermark wrote: post #38
jjoonathan wrote: post #9

Earlier quoted context omitted.

I'm still amazed at how effectively we have collectively shunned thought along these lines by turning the founding father of the relevant branch of economical philosophy into a real life he-who-shall-not-be-named. Anyone who wants to talk about these problems either has to either re-invent the wheel or mention the unmentionable name and doom themselves to immediate dismissal as a kook.

In fairness, attempts have been made to translate the revolution part of his ideas into functional policy at least twice now and both events have included massive violence (and one has followed up that massive violence with a general mismanagement of public resources to the detriment of the "unconnected," not unlike the pain inflicted upon them by the previous ruling class). At this point, the burden of proof is on t…

And those "translations" were criticized from their inception onward by non-authoritarian socialists/Marxists.

For example, Bertrand Russell only 3 years after the revolution (thus 1920):

In a capitalist state, the Government and the capitalists on the whole hang together, and form one class; in Soviet Russia, the Government has absorbed the capitalist mentality together with the governmental, and the fusion has given increased strength to the upper class. But I see no reason whatever to expect equality or freedom to result from such a system, except reasons derived from a false psychology and a mistaken analysis of the sources of political power.

I am compelled to reject Bolshevism for two reasons: First, because the price mankind must pay to achieve Communism by Bolshevik methods is too terrible; and secondly because, even after paying the price, I do not believe the result would be what the Bolsheviks profess to desire.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#122

Post by 0181109 »

rukittenme wrote: post #70

Reganomics, the end of Breton Woods, the end of the "Gold Standard", "Stagflation", "Peak Oil", population growth, immigration, greying population, healthcare, welfare, tax cuts, globalization, capitalism, communism. Oh don't mind me, just pulling excuses out of my ass. I love posts like these and I especially love their graphs. Less so for the (little) content they contain. More so for people's reactions to the cont…

Considering that certain paths of inquiry are off limits socially, both Left and Right, I don't think you'll get that any time soon.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#123

Post by zanny »

roenxi wrote: post #84
digitalmaster wrote: post #8

So looks like the 80s is when things start going south (increased income inequality) so I looked up who was president during that time, then looked at their wiki page to see their economic policy and found this gem of a quote: "Soon after taking office, Reagan began implementing sweeping new political and economic initiatives. His supply-side economic policies, dubbed "Reaganomics", advocated tax rate reduction to sp…

:P Ouch, going right for the partisans. Presidents are important people, but they are a lot more reactive than is generally accepted - what about the theory that Reagan was reforming economics in response to some deeper underlying problem [0]? [0] https://assets.weforum.org/wp-content/uploads/2015/07/150710...

So the implication is that Reagan instituted broad and substantial tax reduction for the rich in combination with the institution of enormous federal deficit spending in order to offset rising oil consumption following two oil crisis the previous decade?

We saw how oil turned out in the long run. Reagans policies, if anything, only gave dictatorships another two decades of unmitigated dominance in an industry we have seen the US itself rapidly commercialize internally. Most US consumed oil is now domestic, and most of the growth happened in the rebound from the 08 recession. I'd be really interested in comparing the economic policies of how Reaganomics protracted foreign dependence while the late Bush / Obama era bailouts and recovery stimulus somehow exploded the domestic market.

Or that neither of those had anything to do with oil, and that the development of the market and industry as a whole was detached enough from federal law of the US that neither president is responsible for anything in that regard.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#124

Post by maxxxxx »

darawk wrote: post #120
enraged_camel wrote: post #114

Earlier quoted context omitted.

>>when you give people who have proven themselves capable of efficiently allocating capital (i.e. the rich) more capital, they continue to allocate it to its best and most productive use for society. You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as oppo…

> You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as opposed to (or at least independent of) other factors, such as luck, inheritance, etc. I'm not making any assumptions. In aggregate, by definition, wealthy people are better at allocating capital than n…

What will these rich capital allocators do when nobody has money to buy their stuff? We need people to produce things and we need people who buy things. Both of these roles are equally important. Considering how housing and other asset prices are going up and companies like Apple are sitting on billions of dollars it seems there are a lot of rich people who don't know how to invest their money productively.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#125

Post by specialist »

jnellis wrote: post #37
Just_Smith wrote: post #28

Earlier quoted context omitted.

It looks as if it began mid-70s. You can see the red and blue start diverging then, though the line stroke width causes some overlap. The heavy divergence begins in the 80's, as you pointed out. I think confirming your theory would be as simple as comparing the policies of "Reaganomics" with the policies that emerged in the 70's that caused the initial bump shown on the chart.

There's a fellow that's discovered a piece of legislation in 1970 that was the turning point for all this lobbying taking over congress so heavily. The lynch pin of his argument is that we have to remove lobbyists from the actual physical galleries in congress and preserve the anonymous nature of how each congressman votes so they can vote their conscious and not how their lobbyist handlers choose. It's a counter-int…

The criticisms of so called sunshine laws are unconvincing. Any one supporting more direct democracy will favor such reforms.

As for why things took a right-wing turn in the mid-70s, I prefer this thesis:

Lobbying America: The Politics of Business from Nixon to NAFTA

https://www.amazon.com/Lobbying-America-Politics-Business-So...

TL;DR: Titans of industry felt persecuted, rolled back The New Deal.

"Lobbying America tells the story of the political mobilization of American business in the 1970s and 1980s. Benjamin Waterhouse traces the rise and ultimate fragmentation of a broad-based effort to unify the business community and promote a fiscally conservative, antiregulatory, and market-oriented policy agenda to Congress and the country at large. Arguing that business's political involvement was historically distinctive during this period, Waterhouse illustrates the changing power and goals of America's top corporate leaders.

Examining the rise of the Business Roundtable and the revitalization of older business associations such as the National Association of Manufacturers and the U.S. Chamber of Commerce, Waterhouse takes readers inside the mind-set of the powerful CEOs who responded to the crises of inflation, recession, and declining industrial productivity by organizing an effective and disciplined lobbying force. By the mid-1970s, that coalition transformed the economic power of the capitalist class into a broad-reaching political movement with real policy consequences. Ironically, the cohesion that characterized organized business failed to survive the ascent of conservative politics during the 1980s, and many of the coalition's top goals on regulatory and fiscal policies remained unfulfilled. The industrial CEOs who fancied themselves the "voice of business" found themselves one voice among many vying for influence in an increasingly turbulent and unsettled economic landscape.

Complicating assumptions that wealthy business leaders naturally get their way in Washington, Lobbying America shows how economic and political powers interact in the American democratic system."

Re: A Guide to Statistics on Historical Trends in Income Inequality

#126

Post by dragonwriter »

maxxxxx wrote: post #93
will_brown wrote: post #61

Earlier quoted context omitted.

The irony is the right holds Reagan as a shining example of fiscal conservatism. However, Reagan ultimately tripled the debt while in office. The right loved saying Obama spent more than all other presidents before him combined (which he did, which Bush did...but Reagan the model of fiscal conservatism spent 2x as all presidents who served before him).

Seems Trump is on the way to top that. That's one thing I never get about modern Republicans. When in opposition they throw a fit about deficits but as soon as they have power they forget these concerns but drive deficits up a lot. Reagan did it, Bush did it and now Trump is doing it too.

> When in opposition they throw a fit about deficits but as soon as they have power they forget these concerns but drive deficits up a lot.

They don't care about deficits, they care about spending priorities. Deficits is just the argument they turn to when they don't have an argument against particular spending priorities.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#127

Post by zanny »

roenxi wrote: post #67
jnellis wrote: post #37

Earlier quoted context omitted.

There's a fellow that's discovered a piece of legislation in 1970 that was the turning point for all this lobbying taking over congress so heavily. The lynch pin of his argument is that we have to remove lobbyists from the actual physical galleries in congress and preserve the anonymous nature of how each congressman votes so they can vote their conscious and not how their lobbyist handlers choose. It's a counter-int…

As ideas go this is a bit of a non-starter. If you can't tell what your congressperson is voting for, how do you know if they are representing you? When you vote, how would it be even theoretically possible to make an informed decision of who you want as a representative? The only axis of discrimination between politicians would be charisma - which is no predictor at all of what someone will actually do. EDIT It migh…

Charisma is only a problem when your representative is a figure on a screen you never see or interact with. Its definitely fallen by the wayside in recent times with the explosive population and suffrage growth not corresponding to a larger legislature, but there is ample historic record of the aristocratic voters in the decades following the founding of the US also having close relations to their representatives. The voters (the In more modern terms it would be if you weren't electing a representative for every several hundred thousand people, but had one for every few hundred. Something constrained by Dunbars Number. You wouldn't be electing a caricature but someone you can actually interact with, especially in an era of total digital interconnection.

Fixing representative democracy in the US and abroad is probably the most fundamental issue facing America and most of the world today. Getting back to actual representation by peers has to happen eventually or the widening divide between the political aristocracy and the commoner will revert most of western society back into a model more reminiscent of 16th century Britain.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#128

Post by [deleted] »

darawk wrote: post #120
enraged_camel wrote: post #114

Earlier quoted context omitted.

>>when you give people who have proven themselves capable of efficiently allocating capital (i.e. the rich) more capital, they continue to allocate it to its best and most productive use for society. You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as oppo…

> You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as opposed to (or at least independent of) other factors, such as luck, inheritance, etc. I'm not making any assumptions. In aggregate, by definition, wealthy people are better at allocating capital than n…

[deleted]

Re: A Guide to Statistics on Historical Trends in Income Inequality

#129

Post by zanny »

darawk wrote: post #120
enraged_camel wrote: post #114

Earlier quoted context omitted.

>>when you give people who have proven themselves capable of efficiently allocating capital (i.e. the rich) more capital, they continue to allocate it to its best and most productive use for society. You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as oppo…

> You are making some wild assumptions that require evidence. Specifically, you need to prove that the reason rich people are rich is because they "have proven themselves capable of efficiently allocating capital", as opposed to (or at least independent of) other factors, such as luck, inheritance, etc. I'm not making any assumptions. In aggregate, by definition, wealthy people are better at allocating capital than n…

Its a generally well documented trend that once rich it becomes difficult to actually fall out of wealth. I'd definitely love some unbiased research in how much better these purported rich people are better at allocating capital.

Because I can easily start naming microeconomically selfish ways of managing capital that the wealthy practice on the regular that it is no way economically beneficial to the parent economy - offshore tax havens, tax loopholes, real estate bubbles, buying politicians and policy to harm liberty, investing in companies that themselves offshore, launder, and hide their capital outside of the economy.

Businesses in the US are magnitudes wealthier today than they were forty years ago but the standard of living has at best remained stagnant for the last 20 (depending on locality, there are substantial regional swings). Money is flush in the upper echelons of society but it has provably and demonstrably not resulted in economic prosperity for the whole nation.

Re: A Guide to Statistics on Historical Trends in Income Inequality

#130

Post by zanny »

logfromblammo wrote: post #90
paulddraper wrote: post #29

Earlier quoted context omitted.

Gut feel: Repeating taxing someone more for living frugally is wrong.

I'd prefer a tax on increase in wealth. Which is to say a tax on income with a deduction for consumption. So you're taxing the act of becoming richer, rather than just owning stuff. I suppose you could still have a wealth tax, if you set the threshold high enough that it only affects the top 10%.

More like affects the top .02%.

What a lot of discussions on economics miss out on is that for every order of magnitude less people you are talking about out of the whole (10%, 1%, .1%, .01%) you are talking about people who then also have orders of magnitude more wealth than the previous categorization.

Your .001% is billionaires, your .01% is hundred millionaires, the .1% is tens millionaires, the 1% millionaires, the 10% is hundred thousandaires (of readily accessible capital, at least - a lot of people in the 10% push themselves into the millions on their consumable assets like their house). Beyond .01% it exponentiates up to Bezos levels of wealth.

When talking about wealth taxes we shouldn't even be thinking about anyone but the 300,000 who have as much wealth as the bottom 292,000,000 - the .1% - at most.

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