Is Inequality Inevitable? • Hacker News Board

Re: Is Inequality Inevitable?

#41

Post by tunesmith » Wed, Nov 06, 2019, 7:31 PM UTC

Ididntdothis wrote: post #24

tunesmith wrote: post #10

Have there been any efforts to quantify what level of inequality is reasonable? For instance, the GINI coefficient ranges between 0 and 1, where 0 means everyone has the same amount, and 1 means one person at the top has everything. Depending on how it's measured, the US is somewhere between 0.4 and 0.5. You don't want to be at either extreme, so some level of inequality is desirable. Is there an appropriate amount o…

Do we know what the number was in the 1950s? Back then housing was more affordable relative to income and CEO salaries were lower compared to the average.

I think it was high 30's back then, and now it's mid-40s. Different sources measure it differently, but generally it's gone up. Mid-30's is like Denmarkish.

Re: Is Inequality Inevitable?

#42

Post by strikelaserclaw » Wed, Nov 06, 2019, 7:32 PM UTC

smashthepants wrote: post #17

zacharytelschow wrote: post #6

Absolutely - and that's a good thing. Those who produce more should earn more as well.

How are we defining production? They say Bezos makes $215M per day. Does he personally produce $215M in 'value' per day? Or do his employees contribute to it?

The workers can generate ideas which would net amazon tremendous amount of wealth from which only a fraction would go back to those who generated the ideas / implemented it. It really is a case of winner take all market. Bill Gates has been retired for a while yet he can't help but keep getting richer. This is not even mentioning those who inherited vast amounts of wealth (like the waltons) and who continue to get super rich even though i doubt they do anything personally that contributes value.

Re: Is Inequality Inevitable?

#43

Post by bhupy » Wed, Nov 06, 2019, 7:32 PM UTC

jlongr wrote: post #23

tunesmith wrote: post #10

Have there been any efforts to quantify what level of inequality is reasonable? For instance, the GINI coefficient ranges between 0 and 1, where 0 means everyone has the same amount, and 1 means one person at the top has everything. Depending on how it's measured, the US is somewhere between 0.4 and 0.5. You don't want to be at either extreme, so some level of inequality is desirable. Is there an appropriate amount o…

Why shouldn't the coefficient be zero? I'm curious what your reasoning is.

Because one point of view is that the difference between the poorest and the richest is less important than ensuring that the minimum standard of living of the poorest is livable/acceptable.

In society A, let's say that the gap between the poor and the rich was high, but the poor had their basic needs being met. In society B, let's say that the gap between the poor and the rich is 0, but the standard of living of everyone is worse than the poorest in society A. In this case, most would agree that society A is better off despite having a non-zero Gini coefficient.

Obviously we want a society where everyone is equal AND their standard of living is as high as it could possibly be, but wars have been fought over figuring out how best to organize society to achieve that.

Re: Is Inequality Inevitable?

#44

Post by michelinman » Wed, Nov 06, 2019, 7:33 PM UTC

Animals on both ends of the bell curve. Serial Killer avg. 10 deaths? Last billionaire I met killed 17 and poisoned 30,000. Silicon Valley is essential viewing at the moment on that subject.

Re: Is Inequality Inevitable?

#45

Post by lucideer » Wed, Nov 06, 2019, 7:33 PM UTC

billions wrote: post #26

petemill wrote: post #20

Earlier quoted context omitted.

Classic. Poor people just aren't working hard enough!

How did you get the computer you're writing on, if not by the method described above?

(not op but) parents supported me through a high quality education, in the safe wealthy western country they brought me into, helped me to develop social skills, and provided a stable upbringing which—all combined—gave me the confidence, comfort and skills to navigate the labour market, secure a well-paying job, and eventually use my wages to purchase this computer.

Re: Is Inequality Inevitable?

#46

Post by endtime » Wed, Nov 06, 2019, 7:34 PM UTC

tunesmith wrote: post #29

jlongr wrote: post #23

Earlier quoted context omitted.

Why shouldn't the coefficient be zero? I'm curious what your reasoning is.

I'm more reflecting the general consensus. That's communism, which is generally seen as a failed economic system, and difficult to practically enforce. Although maybe that all changes in a post-scarcity economy, like is Star Trek technically communist? Should the goal actually be GINI-0?

Star Trek isn't communist; capitalism and communism are both approaches to the allocation of resources. Neither really applies in a post-scarcity society.

Re: Is Inequality Inevitable?

#47

Post by billions » Wed, Nov 06, 2019, 7:34 PM UTC

lucideer wrote: post #25

billions wrote: post #13

Earlier quoted context omitted.

If course it is...it's a natural consequence of compound interest. One's ability to accumulate additional wealth scales exponentially with their level OF EFFORT. Even a wealthy person can lose their money if they don't make an effort investing it properly. How do people build wealth from the ground up? They work hard each and every day and that effort COMPOUNDS. They get smarter, more opportunities present themselves…

You're assuming a world without parents. What an odd world. How do people come to be?

You're assuming you're not born to rich parents. How wealthy are you compared to the people living on $1 per day?

Re: Is Inequality Inevitable?

#48

Post by SketchySeaBeast » Wed, Nov 06, 2019, 7:35 PM UTC

billions wrote: post #22

zacharytelschow wrote: post #6

Absolutely - and that's a good thing. Those who produce more should earn more as well.

It's a fair statement. Can HN provide a logical response instead of downvotes?

Because "produce more" and "have more" aren't actually related. Have you produced more if you're born rich? Does Jeff Bezos actually produce billions?

It's a statement that doesn't actually represent reality.

Re: Is Inequality Inevitable?

#49

Post by ergothus » Wed, Nov 06, 2019, 7:36 PM UTC

billions wrote: post #13

danhak wrote: post #5

Of course it is...it's a natural consequence of compound interest. One's ability to accumulate additional wealth scales exponentially with their level of existing wealth.

If course it is...it's a natural consequence of compound interest. One's ability to accumulate additional wealth scales exponentially with their level OF EFFORT. Even a wealthy person can lose their money if they don't make an effort investing it properly. How do people build wealth from the ground up? They work hard each and every day and that effort COMPOUNDS. They get smarter, more opportunities present themselves…

The fallacy of your argument is that you equate "requires effort" with "the level of results scales with level of effort"

If I have nothing, I have a couple of days to live - I need water, food, shelter. I cannot afford to be picky in the means of getting these. I find a manual labor task. It's hard, exhausting work, but I get paid and can buy water, food, and shelter. Through work and cleverness, I can improve my situation. And "improve" almost always means LESS work, LESS exhaustion, MORE security.

If I have $10,000, I can have at least a few months of water, food, and shelter. I can be picky in how I obtain employment. I can afford to travel distances to find better opportunities (better = LESS work, LESS exhaustion, MORE security). Should something happen (illness, transportation troubles, etc) I can arrange to work around it.

Just having that initial wealth creates an imbalance that is unrelated to my level of effort.

If I have $5 million, I can live modestly off the interest. My "effort" is finding an investment that outstrips inflation enough to let me live off the remainder. This is effort, sure, but it is not 40+ hour work weeks. It is not holding down multiple jobs. It is not skipping paying for car insurance or car inspections or oil treatments because you need one more month to make the payments.

Sure, there are millionaires spending 60+ hours/week trading and dealing. And they are successful. That's fine, but that's not the whole of existence. (it is also very selective - how many people work hard - that hard or harder - and aren't millionaires? That's not the model I want everyone striving towards. That's not success, that's just obsessive wealth.

Re: Is Inequality Inevitable?

#50

Post by csb6 » Wed, Nov 06, 2019, 7:36 PM UTC

zacharytelschow wrote: post #6

Absolutely - and that's a good thing. Those who produce more should earn more as well.

All else being equal, that is true. However, our economic system quite disproportionately rewards the wealthy; if you are born rich, it is extremely easy to pay a financial manager to invest your money and get huge returns - returns earned passively. Most wealthy Americans are not first-generation entrepreneurs who single-handedly (if that is possible) produced millions or billions in value from a background of poverty. It’s an oversimplification to ignore the complex picture of inequality.