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Never mind the 1 percent Let's talk about the 0.01 percent (2017)

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Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#171

Post by hannasanarion »

lucaspm98 wrote: post #150
hannasanarion wrote: post #62

Earlier quoted context omitted.

Bill Gates hasn't worked in 15 years, but his wealth has more than doubled. He has literally sat around doing nothing, occasionally traveling to Africa to boost his PR, and got more money than the median American could make in a million years. How did he "earn" that?

Well didn't he have his money invested in Microsoft, providing them the capital to grow significantly in those 15 years? That's providing a lot of value in my opinion.

Please explain to me how having money means that you should be entitled to other people's money.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#172

Post by Chinjut »

zxcmx wrote: post #110
Enginerrrd wrote: post #37

Earlier quoted context omitted.

I'm fine with changing the alpha value, and finding an optimal alpha value is actually what we should be doing IMO. But we can't act like it's not gonna still be close to some type of power law distribution at the end of the day.

The wealth distributions we see have a mathematical flavour to them but are the result of a system created and governed by humans. In fact vast disparities in wealth can only be created and sustained through significant social effort. It takes an incredible degree of social co-ordination for multi billionaires to exist. Outside of a strong rule of law you have be to a strongman or warlord to keep your hands on all th…

Indeed, the very concept of asset ownership exists only by virtue of social recognition. We make up the rules that define ownership/property/wealth/etc, they are not handed down by God, and we could just as well define/design them differently (as your example of a wealth cap astutely illustrates).

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#173

Post by hannasanarion »

stale2002 wrote: post #131
hannasanarion wrote: post #70

Earlier quoted context omitted.

Yeah, and he stopped doing all that in 2004. Why does he deserve the profits from the hard work done by thousands of engineers to make Vista, 7, 8, and 10, which he had absolutely nothing to do with?

The reason is because the future value of a company was a part of his compensation, for creating the company in the first place. There is nothing wrong with selling away the future value of your contributions, or for other people buying the future value of your contributions.

But they aren't Gates' contributions. He doesn't have anything to do with modern Windows operations. Windows 10 was built by people that he never met. Why does he deserve the proceeds of their work?

Why does he deserve it virtually tax free?

Why does he deserve more than the average MS worker can make in a million years while doing no work himself, just because he owns some pieces of paper?

Seriously, you could have worked at Microsoft as a full time engineer from the time before the genus Homo evolved to the present, through 100 ice ages, and still not have been paid as much as Bill Gates has in his retirement. How can you possibly justify this?

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#174

Post by anoncake »

allovernow wrote: post #36

>Smith, Yagan, Zidar, and Zwick find that the 1 percent’s income is being driven by owner-managers, mostly of small and medium-sized companies—specifically S corporations, partnerships, and limited liability companies. These are talented managers: the researchers find that profits of companies run by these 1 percent-ers are far higher than those of businesses owned by people in the top 5-–10 percent >“The demand for…

1. Outsized rewards don't imply outsized contributions, rent-seeking exists. The contributions don't even have to be positive, see Facebook.

2. Outsized contributions shouldn't result in outsized rewards. The marginal utility of additional wealth is much higher if you're poor. Inequality is inefficient. Also, if you are rewarded as much as you contribute, your net contributions are zero.

> Even our poor have modern conveniences, access to emergency healthcare, generally safe food and infrastructure.

Dude. Emergency healthcare and generally safe food isn't something to be proud of unless you're a developing country.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#175

Post by hannasanarion »

lucaspm98 wrote: post #147
hannasanarion wrote: post #70

Earlier quoted context omitted.

Yeah, and he stopped doing all that in 2004. Why does he deserve the profits from the hard work done by thousands of engineers to make Vista, 7, 8, and 10, which he had absolutely nothing to do with?

So your ownership of a company should be taken away if you don't actively manage it? Would you advocate against me being able to own my 10 shares of Microsoft stock and profiting from the hard work of the engineers? People of all levels of wealth offer their capital to companies in exchange for some return on their investment. Bill Gates provided disproportionate value to the economy and was rewarded as such. He then…

I don't think you understand. Bill gates isn't doing anything. He's been retired for 15 years. He doesn't work anymore. None of the profit that Microsoft has made since then can be in any way attributed to his effort.

Nonetheless, he has increased his hoard of wealth by 60 billion dollars, 120% of what he retired with.

That money was made by the hard work of Microsoft's current engineers, devs, testers, managers, salespeople, call center workers, the whole bunch. THEY are the ones benefitting society, and they would be doing the same job whether Bill Gates existed or not. THEY should be the ones reaping the rewards.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#176

Post by throw0932 »

Applejinx wrote: post #139
throw0932 wrote: post #75

Earlier quoted context omitted.

Eh, what are you saying is mutable here, exactly? The only way of getting a 0.5 Gini ("absolute equality") is if everyone is earning the same, which is ridiculous. As soon as you throw any randomness in there, well, all of a sudden you get inequality. Next, there are the (totally reasonable) winner-take-all mechanics of skilled labor. Are you a better CEO (where "better" here could just mean better at pitching/sellin…

No, you're mistaken. There's a computer simulation that's been posted here, where you run a population and each element gives 'a dollar' to a randomly chosen other element every step, if possible. For no reason: no merit, no purpose, no meaning. This produces not just 'inequality', but the power-law distribution. The only thing you can't know is which element will be the '0.01%' master of the universe, because nothin…

Hang on, let me try to understand your point:

1. A computer simulation where wealth is exchanged by chance has power-law behavior

2. Wealth IRL has power-law behavior

3. Therefore, wealth IRL was exchanged by chance (as opposed to skill)

Is this what you were saying? If not, mind breaking down what you are saying?

Needless to say, the above is affirming the consequent. The exchange mechanism random simulation is modelling need not be the actual mechanism in real life (though it may very well be a good model, viewing skill as randomly assigned to members of the population).

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#177

Post by coldtea »

patja wrote: post #104
allovernow wrote: post #36

>Smith, Yagan, Zidar, and Zwick find that the 1 percent’s income is being driven by owner-managers, mostly of small and medium-sized companies—specifically S corporations, partnerships, and limited liability companies. These are talented managers: the researchers find that profits of companies run by these 1 percent-ers are far higher than those of businesses owned by people in the top 5-–10 percent >“The demand for…

I agree that the aggregate standards and quality of life are much improved over 20, 40, or 60 years ago, but I don't share your satisfaction with the status quo. I would prefer we made some changes that enabled the poor to be housed and receive more than emergency room reactive access to health care. No man is an island, and a devotion to meritocracy can blind you to the reality that the accomplishments attributed to…

>I agree that the aggregate standards and quality of life are much improved over 20, 40, or 60 years ago

Over 100 years ago sure. Over 40 or 60 has it really? People usually consider more stuff (access to cheaper and more gadgets, the internet, etc) as an improved standard of living or quality of life. In other words they conflate technology making some products cheaper for a better standard of living.

But even more important factors, for a large part of society is access to healthcare, education, house, etc -- all of which have gotten more expensive. There was a time when a single earner could buy a house at 25 or 35 and get their kids to college. Now two earner families often struggle.

Middle class jobs have also become more stressful and pressing, while many middle and working class wages, inflation adjusted, have stagnated for decades, despite the increased stress, working hours, and productivity gains.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#178

Post by Applejinx »

throw0932 wrote: post #176
Applejinx wrote: post #139

Earlier quoted context omitted.

No, you're mistaken. There's a computer simulation that's been posted here, where you run a population and each element gives 'a dollar' to a randomly chosen other element every step, if possible. For no reason: no merit, no purpose, no meaning. This produces not just 'inequality', but the power-law distribution. The only thing you can't know is which element will be the '0.01%' master of the universe, because nothin…

Hang on, let me try to understand your point: 1. A computer simulation where wealth is exchanged by chance has power-law behavior 2. Wealth IRL has power-law behavior 3. Therefore, wealth IRL was exchanged by chance (as opposed to skill) Is this what you were saying? If not, mind breaking down what you are saying? Needless to say, the above is affirming the consequent. The exchange mechanism random simulation is mode…

'Therefore' is the only part of that which is unjustified. I'll break it down:

1. The computer simulation demonstrates that simple exchange produces power-law wealth in the absence of value or meaning.

2. Wealth IRL is considerably in excess of this power-law behavior, to the point where it's a real impediment, because…

3. Wealth IRL owes more to capital protecting itself and rewriting the market's or government's rules to cheat. Skill has next to nothing to do with it: wealth derives from crime, manipulation and abuse, and there isn't a fortune anywhere that doesn't have blood on it. So, far from being a simple claim that 'wealth IRL does not correlate with merit/skill', I am rather claiming that wealth IRL correlates with evil, abuse, and criminality. Admittedly worse than your 'how dare you say wealth isn't correlated with merit', but there it is. Sorries :)

The fact that random chance also helps some of these criminals get their start is just a sort of bonus for the criminals, and a handicap to any free market system that might otherwise be a mechanism serving to assert a sort of crude meritocracy. Skill means absolutely nothing. It's about the ability to act criminally and to exploit existing resources and personal relationships, and always has been, all the way on back into dim prehistory.

When it gets too extreme, the guillotines come out or there's some sort of typically very destructive revolution that serves as a great setback to civilization in general. This, too, has happened over and over. It happens not when evil grows too great in its abuse of the peasantry (because nobody ever cares about them), but when the 10 percent or the 1 percent start to get beat up too much by that 0.01 percent, just as the original article highlights. When the 'upper middle class' starts to suffer, that's when things get dicey, because those are the people who can afford to fight their rulers and who have the time, attention and resources to do so.

How's that, does that help? :)

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#179

Post by ananth22by7 »

the_gastropod wrote: post #2

Is anyone else getting bored with this kind of “analysis”? Yes—people in the 99.9th percentile are significantly more than people in the 99th percentile. “Never mind the 0.01 percent. Let’s talk about the 0.0001%!” would be even more crazy, considering the exponential distribution of wealth.

I agree with you. These blogs seem to be full of resentment and insecurity, leading to whining and finger pointing. It seems they’re always interested in other people’s money and their success. It’s tiresome. Let’s maybe focus on how we can do good to the world, instead plotting how we can bring other people down.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#180

Post by xwdv »

hannasanarion wrote: post #171
lucaspm98 wrote: post #150

Earlier quoted context omitted.

Well didn't he have his money invested in Microsoft, providing them the capital to grow significantly in those 15 years? That's providing a lot of value in my opinion.

Please explain to me how having money means that you should be entitled to other people's money.

Right after you explain why it’s fair for an investor to take on all the risk and get no reward.
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