Inequality in Equalland • Hacker News Board

Re: Inequality in Equalland

#71

Post by TimJYoung » Mon, Jan 10, 2011, 11:15 AM UTC

ugh wrote: post #31

This is a nice demonstration that ‘raw’ inequality data is not very useful. “X% have Y% of the wealth!” really doesn’t tell you very much. I’m actually only concerned about the consequences of inequality (which could be positive or negative), not about inequality itself. What do I care if 1% of the population have 99% of the wealth if there are no consequences to it? I certainly don’t want to reduce inequality out of…

I would agree and disagree with you. Looking at just wealth inequality is, as you say, asking the wrong question. The real issue is earned wealth versus inherited wealth. Even the founding fathers were particularly wary of the problem of allowing unearned wealth to aggregate over several generations, and how that can eventually allow incompetency to rule over competency.

And, this doesn't apply simply to the issue of taxing direct inheritances, so it's not so easy to solve with taxation alone. Someone could easily not give their children a dime in direct inheritance, and just stick them high up in one of their companies with a nice, cushy multi-million dollar salary.

Re: Inequality in Equalland

#72

Post by cdavid » Mon, Jan 10, 2011, 11:22 AM UTC

lsd5you wrote: post #38

cperciva wrote: post #33

Earlier quoted context omitted.

It’s not as though all that money in mommy’s and daddy’s bank account makes their kids magically more intelligent. (But it can pay for private schools or for private lessons and so on.) FWIW, numerous studies have found that the vast majority of correlation between parental income and the academic success of children can be explained by a third factor: Parental education. Educated parents both earn more and provide f…

I feel that you are omitting genetics as a possible (probable) significant cause of academic success, which because of the corelation with the parents own academic success will be hard to disambiguate as a variable. According to horizon (a main stream medium-high brow documentary series in the UK), separated twin studies show that as much as 50% of 'measured intelligence' can be attributed to genetics - which was fai…

There has been many studies for a long time (several decades) which show that as far as environment matters, what matters is not so much money, but what is called in sociology "cultural capital" (not sure it is the right expression in English). For example, in France (but I guess in other countries as well), children from teachers succeed much better than children from workers, even though income is not so much different. The ability to speak well, to dress well, manners, etc... matters a lot for getting high social status (through work, etc...), and they are valuable because of the inequality. If everybody has a certain quality, its value is almost zero, it is the same as resources in economy.

As for the origin of measured intelligence, I would be surprised about 50 % of intelligence which could be attributed to genetics if you mean IQ (I don't see how it would be consistent with the Flynn effect, for once). But I would rather avoid a discussion on IQ (I don't think it is very relevant to the discussion, as its correlation with success in modern societies is pretty weak, once above a minimal threshold).

Re: Inequality in Equalland

#73

Post by cdavid » Mon, Jan 10, 2011, 11:32 AM UTC

InclinedPlane wrote: post #58

gnosis wrote: post #8

Earlier quoted context omitted.

"Everyone agrees that some wealth disparity is a good and necessary part of a healthy economy." Nope.

So you think a high-school dropout who spends his days playing Black Ops should have the same wealth as a trained surgeon who saves lives in the ER? No thanks. That idea is brain dead.

That reductio ad absurdum, and most likely not what the OP meant. The idea that a fair society is one where inequalities are rather low is not exclusive to extreme left ideologies. How you articulate inequality and justice is one of the most pertinent way to describe right vs left ideologies, and economics do not preclude either view (up to a certain degree).

If you read serious works about how fairness and inequality relate in modern democracy (for example John Rawls), you will realize that the concept is certainly worth of consideration. Being of a normative nature, it is obviously a matter of personal judgement and opinion, but the idea that inequalities are mostly bad by nature cannot be dismissed as naive, stupid or both.

Finally, I have never seen any serious economic work which claim that inequality was necessary for an health economy. There is a lot of studies about policies which tried to decrease inequalities with disastrous consequences, of course, but that's different.

Re: Inequality in Equalland

#74

Post by Confusion » Mon, Jan 10, 2011, 11:47 AM UTC

gjm11 wrote: post #53

Confusion wrote: post #46

Earlier quoted context omitted.

You can't disagree with either cperciva or btilly, because they've merely been presenting facts and figures. I don't see an opinion there

The original article said: Is there too much inequality in the world? Sure. And cperciva reiterated that opinion above. That's what drunkpotato is disagreeing with. It is clearly an opinion that isn't purely a matter of facts and figures. (One with which, as I happen, I agree.)

I don't think drunkpotato is disagreeing with that at all. He's supporting someone that states that wealth disparity is not a good thing.

Re: Inequality in Equalland

#75

Post by bkmartin » Mon, Jan 10, 2011, 11:58 AM UTC

axod wrote: post #56

gnosis wrote: post #8

Earlier quoted context omitted.

"Everyone agrees that some wealth disparity is a good and necessary part of a healthy economy." Nope.

Why? Do you think that success should also be uniformly distributed amongst the entire population? I'd say reward people who are successful. The fact is the majority of people aren't successful or really very useful to society. The top 1% of society do most of the work, so they get most of the reward. That's pretty fair IMHO. Human motivation requires that success be rewarded. If there is no success, or "success equa…

I would disagree here. The top 1% don't do most of the "work". They might own most of the stocks of big companies, or they might be our greatest "innovators", but they don't do most of the work. We have a TON of small business in the United States. You mean to tell me that those small business owners aren't doing a lot of work? They are certainly more than 1% of the population.

Of course success isn't and couldn't be uniformly distributed amongst the entire population. And I agree, those who are successful should be rewarded for their efforts. But I wouldn't go throwing your garbage man under the bus because he isn't in the top 1% of society. Take your own garbage to the land fill each week and see how useful he is. You can get off your high horse any time and come back to the realities of society. Money doesn't equal success. And by only looking at money, you short those people who are underpaid for the work they do to keep your cushy life so sweet.

By the way, I agree with your last statements as well.

Re: Inequality in Equalland

#76

Post by speleding » Mon, Jan 10, 2011, 12:10 PM UTC

gnosis wrote: post #8

btilly wrote: post #7

According to Wikipedia, 87% of the wealth belongs to the wealthiest 20%. However over 80% of that wealth belongs to the top half of that group. The figures I am looking at do not break it down farther, but my understanding is that this same relative relationship holds for the top 5%, 2%, 1%, and so on. Everyone agrees that some wealth disparity is a good and necessary part of a healthy economy. But there is a lot mor…

"Everyone agrees that some wealth disparity is a good and necessary part of a healthy economy." Nope.

Capitalism, and the income inequality it causes, has proven itself time and again as the most efficient organizing principle to create wealth. You may not like that but I don't think there is any way around that fact.

If you want to go to a less efficient organizing principle you will have to accept that there will be less wealth. If history is any guide the people who will suffer the most from there being less wealth will be the ones at the bottom, not those at the top. Be careful what you wish for.

Re: Inequality in Equalland

#77

Post by naa42 » Mon, Jan 10, 2011, 12:12 PM UTC

jackowayed wrote: post #59

zdw wrote: post #27

Earlier quoted context omitted.

Obviously, we should have a political system that gives higher weight to the votes of people who will participate (suffer?) in the system longer. Therefore, everyone between 18 and 24 years of age gets 10 votes, between 24-30 9, etc, until people over 78 get zero votes (just like minor children under 18). This would deal with the problem nicely. And yes, I am kidding.

Population growth would actually do that to a lesser extent (because there are more 25-30-year-olds than 55-60-year-olds) were it not for the fact that young people are less likely to vote.

Well, you need to have population growth for that. It is not the case for many countries (e.g. Europe).

Re: Inequality in Equalland

#78

Post by marknutter » Mon, Jan 10, 2011, 12:18 PM UTC

j_baker wrote: post #12

maeon3 wrote: post #6

I would like to live in Equal-land, I could live there, slouch around, work the absolute minimum and avoid work, and enjoy exactly the same benefits as those working the hardest to maintain that utopia.

No you don't. Money is a terrible motivator. If the only thing that is keeping you from working hard is the prospect of making more money, might I suggest that you've chosen the wrong career? I'm not saying that Equalland is desirable. I'm just saying that I think you're overestimating the effect money has on how productive people are.

When that money is used to fund something you love to do outside of work, it can be an extremely good motivator. Not everyone requires that their job be the most fulfilling aspect of their life. Plenty of people live for a hobby, a local sports team, travel, raising their children, etc.

Re: Inequality in Equalland

#79

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Re: Inequality in Equalland

#80

Post by s_jambo » Mon, Jan 10, 2011, 12:42 PM UTC

speleding wrote: post #76

gnosis wrote: post #8

Earlier quoted context omitted.

"Everyone agrees that some wealth disparity is a good and necessary part of a healthy economy." Nope.

Capitalism, and the income inequality it causes, has proven itself time and again as the most efficient organizing principle to create wealth. You may not like that but I don't think there is any way around that fact. If you want to go to a less efficient organizing principle you will have to accept that there will be less wealth. If history is any guide the people who will suffer the most from there being less wealt…

I think a large amount of our monetary inequality is down to the way we've allowed our markets to become warped.

The numerous examples of CEOs who kill their company but still make out like a bandit. The traders who're supposedly part of price discovery mechanisms but who actually just seem to keep blowing bubbles. The musicians who're granted a government monopoly to sell something we already have too much of (pop music). These are alot of the top 10% and mostly they're doing so well because our capitalist systems are broken.

Even when you get to what you might think of as 'real' work. Advertising is generally not informative but emotive - thus these jobs mostly exist to distort markets. Lobbyists are in the same line of work but using government edict to achieve the same distortions.

Yes the EMH demonstrates that markets are efficient at distributing resources, but it assumes products are fungible, actors are rational and have perfect information.

Vast swaths of our economy are about stopping products being fungible (branding, copyright, patents, lobbying) and limiting how rational actors are (marketing, branding).