America's 1% Has Taken $50T From the Bottom 90% • Hacker News Board

Re: America's 1% Has Taken $50T From the Bottom 90%

#841

Post by dragonwriter » Fri, Feb 12, 2021, 3:06 PM UTC

dnautics wrote: post #812

notahacker wrote: post #533

Earlier quoted context omitted.

Sure, but having a conceptual framework of why people do things, with models on top [theoretical and empirical] is how mainstream economics works. Pointing out conceptual flaws in each others' models and how that leads to prediction error is how economists debate. The Austrian School on the other hand, is centred on Mises, whose magnum opus insisted that all his conclusions were logically deduced from the premise "hu…

The problem is that mainstream economics fails to accept that the choice of metric to perform their analyses encodes biases. Ivory tower economists don't really grok what affects the working class. (I can't say I totally do myself, but at least I drove for Lyft full time for a year and a half). Mainstream economics says that monetary intervention is necessary to "stabilize" the economy, as measured by metric X Y or Z…

> Mainstream economics also measures the widening wealth gap but it's incredibly infuriating that they can't fucking put two and two together and understand that the gap is the social cost of their stability measures.

Because it's not. It's the cost of fiscal policy decisions made overtly to aid “job creators” in the supposed hope that the wealth they drink in will trickle down as a golden shower for the rest of society.

Re: America's 1% Has Taken $50T From the Bottom 90%

#842

Post by asdffdsa » Fri, Feb 12, 2021, 3:07 PM UTC

natenthe wrote: post #519

asdffdsa wrote: post #518

Earlier quoted context omitted.

Please read the article. It clearly mentions income as a reason for income inequality and not asset value inflation which is due to the fed policy.

The irony...

What irony? Please enlighten me

Re: America's 1% Has Taken $50T From the Bottom 90%

#843

Post by dnautics » Fri, Feb 12, 2021, 3:18 PM UTC

dragonwriter wrote: post #841

dnautics wrote: post #812

Earlier quoted context omitted.

The problem is that mainstream economics fails to accept that the choice of metric to perform their analyses encodes biases. Ivory tower economists don't really grok what affects the working class. (I can't say I totally do myself, but at least I drove for Lyft full time for a year and a half). Mainstream economics says that monetary intervention is necessary to "stabilize" the economy, as measured by metric X Y or Z…

> Mainstream economics also measures the widening wealth gap but it's incredibly infuriating that they can't fucking put two and two together and understand that the gap is the social cost of their stability measures. Because it's not . It's the cost of fiscal policy decisions made overtly to aid “job creators” in the supposed hope that the wealth they drink in will trickle down as a golden shower for the rest of soc…

https://krugman.blogs.nytimes.com/2010/02/13/the-case-for-hi...

"Even in the long run, it's really really hard to cut nominal wages..."

Don't get it wrong. Inflation is a tool to cut wages. It is fundamentally anti-labor.

Re: America's 1% Has Taken $50T From the Bottom 90%

#844

Post by notahacker » Fri, Feb 12, 2021, 3:25 PM UTC

dnautics wrote: post #840

notahacker wrote: post #815

Earlier quoted context omitted.

> Mainstream economics says that monetary intervention is necessary to "stabilize" the economy, as measured by metric X Y or Z. Who benefits from that stability? The people who lose absolutely everything they've ever worked for in the event of a sustained recession. They tend not to be rich, nor comfortable with the rival Austrian solution of waiting it out because if wages drop low enough the rich might eventually d…

You don't have to be an austrian to acknowledge that some of what they say is sensible. Discarding a theory in toto because it's adherents are odious is exactly the sort of hubristic political bullshit that results in you fucking everyone over.

Sure, but you don't have to take any notice whatsoever of Austrian economics to critique the biases encoded in an economic model (indeed not being overtly hostile to the concept of economic modelling per se leads to much more parsimonious critiques of models and explicit identification of second order effects). I'm not really sure that Austrian economics has much to say that is sensible beyond illustrating basic microeconomic concepts and noting that inflation can [sometimes] be bad, business cycles are a thing and the predictive power of equilibrium models is limited, and you get all that in a mainstream undergrad textbook.

Not being an Austrian helps you conclude that their arguments that economics isn't quantitative, positivism isn't useful and reducing income inequality is actually a goal a government might wish to consider wrong though. :)

Re: America's 1% Has Taken $50T From the Bottom 90%

#845

Post by mbroncano » Fri, Feb 12, 2021, 3:38 PM UTC

username90 wrote: post #136

saint_abroad wrote: post #124

Earlier quoted context omitted.

Progress over the last 400 years is being undone by regressions of the last 40 years. > individuals born in 1980 have only a 45% chance of outearning their parents at age 30, compared to 93% for those born in 1940. https://www.weforum.org/agenda/2020/09/social-mobility-upwar...

Sounds like progress stopped, not that it reversed. When things are stable you'd expect that a bit less than 50% are richer than their parents.

I find it difficult to believe that progress stopped at some point in the later 70's

Re: America's 1% Has Taken $50T From the Bottom 90%

#846

Post by TrinaryWorksToo » Fri, Feb 12, 2021, 3:38 PM UTC

unishark wrote: post #781

TrinaryWorksToo wrote: post #669

Earlier quoted context omitted.

Do you understand how poor some people are?

This is a different goalpost. The story is about the top 1 percent versus the bottom 90 percent.

https://www.cbsnews.com/news/nearly-40-of-americans-cant-cov...

Re: America's 1% Has Taken $50T From the Bottom 90%

#847

Post by notahacker » Fri, Feb 12, 2021, 3:44 PM UTC

dnautics wrote: post #843

dragonwriter wrote: post #841

Earlier quoted context omitted.

> Mainstream economics also measures the widening wealth gap but it's incredibly infuriating that they can't fucking put two and two together and understand that the gap is the social cost of their stability measures. Because it's not . It's the cost of fiscal policy decisions made overtly to aid “job creators” in the supposed hope that the wealth they drink in will trickle down as a golden shower for the rest of soc…

https://krugman.blogs.nytimes.com/2010/02/13/the-case-for-hi... "Even in the long run, it's really really hard to cut nominal wages..." Don't get it wrong. Inflation is a tool to cut wages. It is fundamentally anti-labor.

And yet [ceteris paribus] a wage rise for a proportion of workers literally is inflation.

It is difficult to paint the alternative of artificially restricting the money supply to a level where the private sector [as a whole] must reduce some employees' nominal wages or fire them every time it offers pay rises to its most in-demand staff as more pro-labour. It doesn't sound any more pro-labour when people preferring that arrangement argue that recessions are a more appropriate mechanism to hold down wages, and acknowledge the purpose of zero inflation [and acceptance of economic downturns] is to allow wealth to be preserved for years or even generations without the need for it to be used in job creation.

Re: America's 1% Has Taken $50T From the Bottom 90%

#848

Post by Rury » Fri, Feb 12, 2021, 3:47 PM UTC

thedudeabides5 wrote: post #782

Rury wrote: post #701

Earlier quoted context omitted.

Even without a money printer and everyone mass adopted bitcoin, massive inequality would still ensue. This is because Bitcoin is inherently deflationary. Both inflation and deflation are natural drivers of inequality... they just work in different directions.

Bitcoin is inherently deflationary...if the entire world moves to bitcoin, and somehow we prevented the extension of credit based on bitcoin collateral by financial intermediaries... Which is already happening. Financial institutions are already extending credit (aka 'printing money') based on bitcoin and other cryptocoin collateral. Bitcoin is not necessarily deflationary.

I'm sorry but you seemingly contradict yourself:

>we prevented the extension of credit based on bitcoin collateral...

>Which is already happening.

Is in direct contradiction to:

>Financial institutions are already extending credit...

Regardless, the amount of bitcoin is set to be capped and finite - therefore unless this changes it is inherently deflationary. Aside from mining out the remaining unmined bitcoin, no institution is "extending credit" (aka 'printing') bitcoin, they're extending credit via (as you mentioned): other collateral.

Re: America's 1% Has Taken $50T From the Bottom 90%

#849

Post by dragonwriter » Fri, Feb 12, 2021, 3:51 PM UTC

dnautics wrote: post #843

dragonwriter wrote: post #841

Earlier quoted context omitted.

> Mainstream economics also measures the widening wealth gap but it's incredibly infuriating that they can't fucking put two and two together and understand that the gap is the social cost of their stability measures. Because it's not . It's the cost of fiscal policy decisions made overtly to aid “job creators” in the supposed hope that the wealth they drink in will trickle down as a golden shower for the rest of soc…

https://krugman.blogs.nytimes.com/2010/02/13/the-case-for-hi... "Even in the long run, it's really really hard to cut nominal wages..." Don't get it wrong. Inflation is a tool to cut wages. It is fundamentally anti-labor.

Yes, it makes real wage cuts instead of catastrophic job cuts more practical when particular forms of work lose market value, which also reduces the degree to which future risk of decline needs to be built in up-front to wages.

But it's a blunt instrument. Providing tools to aid those workers adversely affected by those market shifts, whether by declining real wages or lost jobs, is the role of fiscal, not monetary policy.

Re: America's 1% Has Taken $50T From the Bottom 90%

#850

Post by learc83 » Fri, Feb 12, 2021, 4:04 PM UTC

tobmlt wrote: post #342

learc83 wrote: post #326

Earlier quoted context omitted.

If you're talking Austrian economists, who are the primary proponent of the "fed is the bad buy, bring back the gold standard" argument, they explicitly reject any attempt at modeling or mathematical analysis. They are only interested in arguments based on "self evident" axioms. I've read many of the books you're talking about, and there's a reason they are "unpopular" and “discredited".

There is no need to throw out the baby with the bathwater here. Who cares about gold? Who cares about avoiding math? Not me. I guess I am no Austrian for those reasons. I do care, however, about restraining the inflationary tendencies of governments because I believe they are an engine of wealth redistribution from the poor to the rich and powerful. And sure, I suppose I do care about avoiding mathematical naval gazi…

>Who cares about gold? Who cares about avoiding math? Not me. I guess I am no Austrian for those reasons.

The people who wrote those books that you said would support your argument certainly do.

>I’ll be happy to get my (Of course discredited) books out and recite the counter case about the Great Depression if anybody really wants me to later

>I do care, however, about restraining the inflationary tendencies of governments because I believe they are an engine of wealth redistribution from the poor to the rich and powerful.

Are you basing this belief on anything other than gut feelings and the work of Austrian economists who's books you've read? von Mises is an absolute crackpot, but he does a very good job of making you "feel" that his arguments are valid.

>And sure, I suppose I do care about avoiding mathematical naval gazing, or statistical hackery.

That's different than the Austrian position that mathematical analysis is impossible and harmful. Without accepting the basic premise of Austrian economics that "no measurement is possible" and everything can be derived from the first principle of "humans acting with purpose", the rest of their "proofs" are worthless. You can't just accept (and cite) their arguments while also acknowledging the fundamental flaws with the axioms they use to reach their conclusions.