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Share of Income Gains by Quintile - Great Depression til Now

nytimes.com

141–150 of 302 posts

Re: Share of Income Gains by Quintile - Great Depression til Now

#141

Earlier quoted context omitted.

Why don't you go back to a 60s lifestyle? It is definitely possible; plenty of people live low impact non material focussed lives. My point is that there is a reason that it takes 2 incomes to support a household now--All the extra stuff we have. I was refuting the people who keep asking why we have to work so hard just to have a normal life.

>All the extra stuff we have. It's NOT that stuff though. That stuff is cheap. It's rent, food, childcare, healthcare, and education. These are not luxuries. Cellphones cost nothing compared to these real costs, which can't be reduced by a "low impact" life.

Food - I read a report recently that said the amount of hours the average person has to work to feed himself has dropped dramatically over the last 100 years.

Rent - accept 60s level housing and you can easily afford it, 1 bathroom each kid doesn't get his own bedroom etc..

Childcare - not applicable if you are living a 60s lifestyle you're wife won't work.

Education - Expensive b/c the govt subsidizes it.

Healthcare - problematic, but only b/c healthcare now is so much better than healthcare then.

Re: Share of Income Gains by Quintile - Great Depression til Now

#142
post #36

Technological progress should cause increasing economic inequality, because the bottom end of the scale is firmly anchored at zero (someone taking a vacation), while technology gives the top end ever more powerful levers. So the interesting question is not why economic inequality is increasing, but why for a few decades in the mid twentieth century the trend was reversed. There are probably several factors at work he…

[deleted]

Re: Share of Income Gains by Quintile - Great Depression til Now

#143
post #53
post #46

Earlier quoted context omitted.

Less than people think. Back when taxes were so high, the rich were really good at tax avoidance. So the rate doesn't tell you the whole story. As one of the people whose opinion about working for a large company changed during the 1970s, I know I didn't consciously think about tax rates. (It's possible they affected me unconsciously though, via the examples of people who'd cleared more after tax due to lower rates.)

"Back when taxes were so high, the rich were really good at tax avoidance." first, [citation needed]. Second, compared to now? Third, is it relevant? how? I see you glossed over that. It's like hacking..and painting..isn't it.

If the rich didn't actually pay the percentage in taxes as given by their tax bracket, then their tax bracket isn't relevant because it isn't something that was actually followed in practice.

Also, capital gains tax is really. You'd have to make less than $8,500/yr to be in a lower income tax bracket. This hasn't always been the case. So, one easy, legal way to pay less in taxes is to get paid via capital gains.

Re: Share of Income Gains by Quintile - Great Depression til Now

#144

I'm sorry, but there seems to be an omitted first step in the entire comment thread of critiques -- from all comments coming from all political angles: examining the underlying data. The NYT graphic tells a terribly compelling story that supports a particular political point of view. That tickles my bullshit sensor, and tells me it is time to question the underlying data and assumptions. Frankly, this graphic makes m…

It's kind of hard to A/B test an economy.

Re: Share of Income Gains by Quintile - Great Depression til Now

#145
post #36

Technological progress should cause increasing economic inequality, because the bottom end of the scale is firmly anchored at zero (someone taking a vacation), while technology gives the top end ever more powerful levers. So the interesting question is not why economic inequality is increasing, but why for a few decades in the mid twentieth century the trend was reversed. There are probably several factors at work he…

I actually believe that lack of democratic institutions and lack of regulations is enabling rich (either rich by inheritance or self made) to become more rich.

I'm not sure how large corporation has influence to this because at least, in Eastern Europe, raise of inequality (tycoons and such) goes hand in hand with lack of democratic institutions (sometime outright corruption but in many cases everything is "legal") and lack of regulations.

Unfortunately, regardless of reason of increasing inequality, history showed us that inequality is often fixed by events which are not part of capitalism teaching (revolution, war, crazy people end up leading the country).

Re: Share of Income Gains by Quintile - Great Depression til Now

#146

Earlier quoted context omitted.

The first half of your comment is idiotic and unworthy of HN. Find me someone who has actually stated that the poor deserve their lot. The Tea Party's primary gripe is that the government is picking winners and losers and the best way to get rich is now to lobby rather than to work hard. Even Reagan, the godlike idol of the small-government right, never thought the poor deserved it, he just thought that the best way…

The Tea Party has millions of people, so there may be a few different views in there. However my impression was that the bulk of the Tea Party harbors a lot of hate for welfare recipients and social services in general. They believe the poor should pull themselves up via bootstraps and should not receive direct help from the government. Am I wrong about this?

Believing that someone shouldn't receive direct help from the government isn't the same thing as believing that they shouldn't receive help. This is a false dilemma.

As, perhaps, a kind of silly example, a couple of weeks ago, my car wasn't working, I was immobile. I didn't and don't believe that the government should've helped me get my car working. But I did believe that I should be helped. I called a couple of my friends and now my car is working again.

Re: Share of Income Gains by Quintile - Great Depression til Now

#147
post #90

Earlier quoted context omitted.

Just because I might disagree with your methods of equalizing income, doesn't mean I "believe poor people deserve their lot and should wallow in it." You've turned a political disagreement about the methods to accomplish some desirable goal do so into a moral argument. You've decided that if I think there is a better way to elevate the poor than your way, I must want them to stay poor and thus must be evil. Why do yo…

Politics and morality are intimately related. There are SOME free market ideologues who believe that unrestrained corporations will enrich the poor, however I believe they are in the minority. You may be one of them. The majority of libertarians believe that individual property rights are sacrosanct and that it is wrong to forcibly redistribute wealth to prevent poverty, hunger, suffering. This is the argument of the…

Economics is not like religion; there are actual correct and incorrect answers. As a newer field, we not always know how to find the correct answers yet. But that isn't an excuse to start treating it more like religion and less like science.

"we can let them keep it and allow people to suffer."

Using your feelings to guide your monetary policy decisions is no better than the creationists forcing ID to be taught in schools. If your hunch is that a Keynesian approach is ideal, cool. Many would agree. But choosing it because it's the obvious "moral" choice just dumbs down the whole debate, opens the door to all sorts of emotional reactionary ignorance, and doesn't get us any closer to the right answer.

Re: Share of Income Gains by Quintile - Great Depression til Now

#148
There's one question, regardless of if you believe this is "fair" or not, around whether structural inequality at this level is harmful to society regardless of fairness. I tend to believe it is, based on historical precedent of what happens in highly unequal societies (it tends to not be good), but that's a separate question from the one about fairness.

To analyze whether this is "fair" or not, I think the best perspective there is Rawls's framework, which is the maxi-min idea. To summarize, the idea is that inequality is okay to the extent that it improves the minimum position. For example, if you start out with some totalitarian society where everyone makes $25k, it's okay for someone to start making $200k so long as it doesn't mean that someone else now makes less than $25k. Economically, that comes out as something like: it's okay for the top end of the wage spectrum to increase because they're producing more value and capturing that value for themselves. It's not okay for them to increase because they're capturing value that other people are creating instead. If someone making $500k starts making $1MM because they're producing $500k more in value, that's acceptable. If they do that and they're only producing $300k more in value, and the other $200k increase is coming from other people's productivity increases, then that's not "fair" and shouldn't be acceptable.

So, which one is it? Does anyone have a compelling argument? In the financial sector, for example, I think it's pretty easy to argue that it's the latter: people who privatize gains and socialize losses are enriching themselves far out of proportion to the value they create. When it comes to startups and new businesses, it often works the other way, in that the person starting the business, even if they become hugely wealthy, does so by creating even more value than they capture. I'm not sure it's obvious if what's been going on for the last 40 years is one way or another.

Re: Share of Income Gains by Quintile - Great Depression til Now

#149
post #36

Technological progress should cause increasing economic inequality, because the bottom end of the scale is firmly anchored at zero (someone taking a vacation), while technology gives the top end ever more powerful levers. So the interesting question is not why economic inequality is increasing, but why for a few decades in the mid twentieth century the trend was reversed. There are probably several factors at work he…

This presumes that only the "top end" has access to those levers. That's only true through the patent system and, incidentally, Dean Baker points out that the patent system is a good predictor of inequality.

So levers for me, not for thee has precisely the result we would expect. Fascinating.

Re: Share of Income Gains by Quintile - Great Depression til Now

#150
post #36

Technological progress should cause increasing economic inequality, because the bottom end of the scale is firmly anchored at zero (someone taking a vacation), while technology gives the top end ever more powerful levers. So the interesting question is not why economic inequality is increasing, but why for a few decades in the mid twentieth century the trend was reversed. There are probably several factors at work he…

"while technology gives the top end ever more powerful levers"

Technology can create entirely new ways of delivering value and generating income, it can multiply income and it can eat existing income streams.

Inequality is not such a bad thing if technology is the vehicle of economic mobility. Technology can act as a enabler in both directions of income generation.

However, when wealth or power or technology prevent economic mobility at any level, that is a bad thing. Inequality is not the problem, its access to economic mobility, which presumably means access to empowering technology.

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