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20 year study of global wealth demolishes the myth of ‘trickle-down’

businessinsider.com

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Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#11

Post by dontreact »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

1) There are certain issues which are unlikely to receive spending due to well-known economic effects. For example: building highways and public transportation are things unlikely to be funded by individuals because they are public goods. 2) There is little evidence that the high tax rates in the middle of the century led to decreased productivity. Tax rates are marginal, meaning that more effort leads to more reward, still.

Lastly inequality as it grows more extreme is a problem in and of itself. Unless you posit that the effort put in by the top 1% has increased a lot, then what we have is a situation that seems unfair. And this is demotivating, and will lead to instability in society even more than it already has. Why would you try to push forward your society if it seems like no matter what you do, wealth inequality is just going to increase, and the top 1% are going to capture most of the rewards? It's true that it's a rising tide that floats all boats, but if some are being floated much more than others then there are issues around power that are concerning. We already see evidence that increasingly the government is less responsive to those without wealth and more responsive to those with wealth. Wealth may be a zero sum game, but power is not. If we allow wealth to concentrate, then power concentrates.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#12

Post by usrusr »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

You write that as if "long hours and sacrifices" in bullshit jobs were a good thing.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#13

Post by brabel »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

Once you've made 100 million dollars or more, there's literally no justification for you to be allowed to keep piling up money in your safe.

I absolutely support taxing 90% on any earnings above a ridiculous threshold like that, that no one really deserves, not matter how smart or hard working, while people who happened to be born under different circumstances and might work their ass off for their whole life won't get even a tiny percentage of that no matter how hard they try.

Do you think Elon Musk or Jeff Bezos deserve wealth literally thousands of times bigger than anyone you've probably ever known personally (and I am assuming HN readers tend to know a lot of smart, incredibly hard-working people - but even they won't make a tiny fraction of a billion in their whole lives)?

If you think there needs to be an incentive for people to put in hard work into something, I would say that you just need to look at open source. People will put insane amounts of work with basically zero chance of getting anything back in return monetarily. All they want is some respect and acknowledgement of their abilities - it's enough for most of the really smart people (who can make enough money on other activities without having to amass billions to be happy).

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#14

Post by ZeroGravitas »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

It depends, are you actually progressing any of societies goals with all that effort?

If not then not only do I want to tax you your fair share in progressive taxes, I want to fine you to stop you doing destructive things.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#15

Post by forinti »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

Long before we get to something like a 90% tax bracket, we could have the very wealthy pay the same rates as regular folks.

Anyway, I don't see why a billionaire shouldn't have a 90% bracket.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#16

Post by esja »

q1w2 wrote: post #4

I haven't heard a politician advocate trickle-down since the Reagan era. This seems like one of those strawman political football arguments. Also, the methodology here is a bit flawed. I think that economic data that cherry picks the start of the covid-19 pandemic is deeply flawed. 2020 will always be known as an economic outlier. It's like selecting 2008, or September 2001. These are data points that should be elimi…

It’s not a straw man at all. The Fed explicitly justifies QE and the rest of their monetary insanity on the basis of the “wealth effect”. They believe asset price rises will create a feeling of wealth which will generate additional spending. They know that these asset price prices disproportionately benefit a wealthy minority. This is trickle-down economics.

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#17

Post by andrekandre »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

  > 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending?
govt could be corrupt regardless of the spending levels (industry deals, favorable laws, other bribes etc)... maybe corruption and spending are orthogonal concern?

  > Would I be willing to put in the long hours and sacrifices usually required to work up to a $1m+ salary if it’s taxed at a 90% rate?
i dunno, but there are lots of working poor that work insane hours (and multiple jobs) too who wouldn't get a much more even if tax was set to zero.... probably for them, a more fair distribution (a.k.a whatever the opposite of trickle-down would be) might be more favorable choice...?

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#18

Post by pydry »

codegrappler wrote: post #2

I guess I’m not surprised that a bunch of folks who have made a career out of advising politicians on income inequality….discovered income inequality in their study. The two questions in my mind are: 1. Should we trust the government to spend the money more wisely than the folks who earned it? Or said another way, how do you combat the almost inevitable corruption you see with large government spending? 2. What will…

>the folks who earned

It's quaint that there are people out there who believe that income at the top strata of society is primarily earned.

Those dividend payments, rents and capital gains (realized) that make up the bulk of top earner incomes happen while they sleep.

A minimum wage is earned. A doctor's wage is earned. A golden parachute after a CEO ruins a company? Somebody with a trust fund? A person living off dividend income? Not so much.

It's one in a series of ways the .1% try to rhetorically conceal themselves. Another is that article the other day that complained about an overproduction of "elites" (referring to college degreed starbucks baristas).

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#19

Post by Simon321 »

esja wrote: post #16
q1w2 wrote: post #4

I haven't heard a politician advocate trickle-down since the Reagan era. This seems like one of those strawman political football arguments. Also, the methodology here is a bit flawed. I think that economic data that cherry picks the start of the covid-19 pandemic is deeply flawed. 2020 will always be known as an economic outlier. It's like selecting 2008, or September 2001. These are data points that should be elimi…

It’s not a straw man at all. The Fed explicitly justifies QE and the rest of their monetary insanity on the basis of the “wealth effect”. They believe asset price rises will create a feeling of wealth which will generate additional spending. They know that these asset price prices disproportionately benefit a wealthy minority. This is trickle-down economics.

>The Fed explicitly justifies QE and the rest of their monetary insanity on the basis of the “wealth effect”.

They do?? Do you have a source for this?

Re: 20 year study of global wealth demolishes the myth of ‘trickle-down’

#20

Post by dontreact »

q1w2 wrote: post #4

I haven't heard a politician advocate trickle-down since the Reagan era. This seems like one of those strawman political football arguments. Also, the methodology here is a bit flawed. I think that economic data that cherry picks the start of the covid-19 pandemic is deeply flawed. 2020 will always be known as an economic outlier. It's like selecting 2008, or September 2001. These are data points that should be elimi…

I agree that "trickle-down" is usually how critics attack tax cuts for the rich.

However, we have seen several rounds of tax cuts for the rich and the language used to justify it is something like "these tax cuts will stimulate growth and that's good for everyone".

The general point of the article is that tax cuts for the rich lead to more inequality which is hard to argue with.

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