Billionaires amass more through inheritance than wealth creation, says UBS • Hacker News Board

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#201

Post by wing-_-nuts » Fri, Dec 01, 2023, 6:53 PM UTC

chrischattin wrote: post #130

mushufasa wrote: post #17

This is the conclusion of Thomas Picketty's 2013 book, "Capital in the 21st Century." Due to the historical averages of the rate of return on capital, he concluded empirically that wealth will continue to concentrate to the point to inheritors, to the extent that individuals become increasingly unable through labor to achieve parity to the inheritors. The book was very provocative in economist circles, but even the c…

Hardly empirical. The data shows the opposite. ~80% of current billionaires in the U.S. are self-made first generation.

You don't have to inherit billions from your parents to have a huge leg up on everyone else. There are examples all over the place from something as extravagant 'a small loan of a million dollars' to 'an introduction to a vp at ibm', to paying their kids tuition to the best private schools. I am extremely suspicious of any wealthy person who claims to be 'self made' when in reality they had a paved path to success.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#202

Post by ambientenv » Fri, Dec 01, 2023, 6:54 PM UTC

sidewndr46 wrote: post #166

kelseyfrog wrote: post #136

Earlier quoted context omitted.

The alternative of last resort is always violent revolution[1]. Wealth redistribution is the olive branch. There seems to be an open question among the wealthy and political class of how far inequality can go given the modern police state and effectiveness of technology in accomplishing the goal of maintaining or exacerbating the current political economy. 1. See historical populist grivences against aristocracy that…

Overwhelmingly, violent revolution doesn't actually bring about the goals of the revolution. It just installs a new power structure with variations on all the old problems. Sometimes much worse. So it isn't really a "last resort". It's more of a "well you didn't compromise, so now our choice is to burn the whole system down"

This feels true to me. So my question is - and I don't know the answer yet, though I continue to seek such - when do we, as a humanity, break this cycle? When, and how, do we override the greed impulse, the impulse for power and control and domination of others? When do we begin to leverage a superior cognitive capacity enough to gain true enlightenment and break free from the bonds of behaviour which, while necessary as we evolved, is no longer required, and replace it with an egalitarian perspective and an accompanying stewardship model of life on earth?

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#203

Post by somenameforme » Fri, Dec 01, 2023, 6:54 PM UTC

pkkm wrote: post #134

This title is pure clickbait. The article says that out of the last 9 years, the statement has been true for 1 and false for 8. Flagged.

It's also an extremely misleading, if not stupid, measurement of what they are claiming. They take the earnings of new self-made billionaires, and contrast that against the amount passed down to heirs, in a given year.

You're looking at the earnings of brand new billionaires, contrasted against the lifetime earnings of recently deceased billionaires, and seeing which is bigger. There is no way that this will not trend towards always favoring the lifetime earnings, especially as the ratio of total_billionaires : new_billionaires continues to increase.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#204

Post by DennisP » Fri, Dec 01, 2023, 6:55 PM UTC

hn_throwaway_99 wrote: post #178

DennisP wrote: post #155

Earlier quoted context omitted.

Hah, I've seen this title all over. Pretty easy to miss that it was just this past year, contrary to the prior eight years.

I don't find that to be clickbait at all. It wasn't just any one year in the past nine, it was the most recent. Heck, the title could have been "For the first time in recent history, billionaires amass more through inheritance than wealth creation." That would perhaps have been more accurate, but that's also a "stronger draw" in my opinion than the actual title. It doesn't make sense to call something "clickbait" tha…

I wasn't the one who called it clickbait but I do think it's misleading. The one year could easily be an outlier. It might be by accident, or it could be that the writer was more interested in pushing a political view than getting clicks.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#205

Post by fsckboy » Fri, Dec 01, 2023, 6:56 PM UTC

digging wrote: post #193

bertjk wrote: post #142

Earlier quoted context omitted.

How is it different? Squandering typically means spending, which means the money is re-entering the economy, typically to people at lower rungs of the wealth ladder, and is not much different than other forms of redistribution. Unless you mean the squandered billions was through literal setting piles of money ablaze or losing it all in a poker game to bigger billionaires, it seems if redistribution was the goal then…

> Squandering typically means spending Squander means to spend thoughtlessly or foolishly or wastefully. It's not a synonym of "spend".

in terms of usage, if I say "people should buy what they need and on top of that they should not spend (lest they find themselves spent)" you know exactly what i mean. Especially expensive items are spendy. Spend carries a connotation of waste and exhaustion. Save and invest your surplus, don't spend it, don't spend your savings.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#206

Post by Sohcahtoa82 » Fri, Dec 01, 2023, 6:59 PM UTC

Fauntleroy wrote: post #81

abeppu wrote: post #59

Earlier quoted context omitted.

I also think it's worth calling out that his follow-up, "Capital and Ideology" in its latter sections includes several suggestions for counteracting the trend to increasing inequality. One of these is basically that _every_ person should have a windfall inheritance when they're in their early adulthood, which would give them opportunities to pursue education, try starting a business, or whatever else. And naturally,…

People whine about "wealth distribution" day and night, but at the end of the day what alternative is there to combat the (continually increasing) concentration of wealth at the top? At some point there will have to be redistribution, in some form, and the sooner society comes around to that the better off we'll all be.

For people against the wealth redistribution as a concept (whether it's UBI, better welfare programs, increased minimum wage, etc), what do you think the end-game looks like for continued growth in wealth inequality?

The only answer I can see is that your customer base shrinks as fewer people are able to buy.

Or you get violent revolution as the poor are sick and tired of being priced out of even being able to afford housing and they decide they have nothing left to lose.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#207

Post by aaroninsf » Fri, Dec 01, 2023, 7:00 PM UTC

What's shocking as someone who is well know to rant about the inevitability of capital accumulation, and the acceleration of that process once wealth captures governance—something that happened many many decades ago in the US—is that this would surprise anyone.

For the 1%, or if you prefer, for those classes which have seized and all but exclusively retain control over not just wealth but power, this is of course "bug not feature."

The social ills and crises of contemporary democracy are entirely, directly, obviously even, traceable to the consequences of this tendancy and its execution.

Lest anyone in the 1% (or, more likely for the readership here, the precariate 10%) take solace in being in the narrow pool of "winners" of this system,

we are now experiencing the all but inevitable dis-equilibrium resulting from the fact that this accumulation has no check, no retarding feedback.

The end state is single-state autocratic kleptocracy,

troubled be deep and permanent social unrest and all but ubiquitious disaffectation and dis-ease and hence violence, mostly incorrectly targeted at fellow victims of the system.

This is a hell-state and hell-scape we do not deserve.

Yet here we are.

Billionaires and their corporate proxies should be ALIGNED.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#208

Post by zozbot234 » Fri, Dec 01, 2023, 7:01 PM UTC

ambientenv wrote: post #202

sidewndr46 wrote: post #166

Earlier quoted context omitted.

Overwhelmingly, violent revolution doesn't actually bring about the goals of the revolution. It just installs a new power structure with variations on all the old problems. Sometimes much worse. So it isn't really a "last resort". It's more of a "well you didn't compromise, so now our choice is to burn the whole system down"

This feels true to me. So my question is - and I don't know the answer yet, though I continue to seek such - when do we, as a humanity, break this cycle? When, and how, do we override the greed impulse, the impulse for power and control and domination of others? When do we begin to leverage a superior cognitive capacity enough to gain true enlightenment and break free from the bonds of behaviour which, while necessar…

We are pretty much there already. The average person in a developed Western country is pretty much a billionaire when compared to the living conditions of even the wealthiest people in ancient history. It's only the impulse of greed and envy towards others that leads us to believe otherwise.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#209

Post by AnthonyMouse » Fri, Dec 01, 2023, 7:01 PM UTC

abeppu wrote: post #59

mushufasa wrote: post #17

This is the conclusion of Thomas Picketty's 2013 book, "Capital in the 21st Century." Due to the historical averages of the rate of return on capital, he concluded empirically that wealth will continue to concentrate to the point to inheritors, to the extent that individuals become increasingly unable through labor to achieve parity to the inheritors. The book was very provocative in economist circles, but even the c…

I also think it's worth calling out that his follow-up, "Capital and Ideology" in its latter sections includes several suggestions for counteracting the trend to increasing inequality. One of these is basically that _every_ person should have a windfall inheritance when they're in their early adulthood, which would give them opportunities to pursue education, try starting a business, or whatever else. And naturally,…

> And naturally, this needs to be funded by taxes on the very wealthy.

This is the part where the math never works out.

If you look at the richest people, they have something like tens to low hundreds of billions of dollars. Which is less than the amount of money the federal government already spends every week. If you taxed the top 100 billionaires at a rate of 100%, it would fund the existing federal government (and no new programs) for about a year, and then there would be nothing left for next year.

The funding for programs like that never comes from the "very wealthy" because there just aren't enough of them for that. It comes from the upper-middle class. Which is fine, but let's not delude ourselves that we can get there by only taxing Bill Gates and not your local cardiologist.

Except that they already pay kind of high taxes. These are the people who make six figures but don't have a personal full-time tax accountant to engage in international tax avoidance shenanigans. They're how the state and federal governments in the US together spend around 50% of US GDP.

So the problem isn't that we don't have enough tax revenue -- holy crap does the government have a large budget -- the problem is what we're spending it on. We should be spending less on the military and means-tested assistance programs and instead use the money for a UBI.

Re: Billionaires amass more through inheritance than wealth creation, says UBS

#210

Post by TacticalCoder » Fri, Dec 01, 2023, 7:01 PM UTC

gretch wrote: post #86

Qem wrote: post #53

Earlier quoted context omitted.

We are devolving to the status quo from the nineteen century and before. A couple owners of inherited wealth and huge dispossessed masses.

This is true if you view the world from a zero-sum perspective. If the rich are winning, then the poor must be losing. But I would argue the world is not zero-sum. Modern life for middle class or poor class people is a lot better than the vast majority of history (the 2 notable exceptions are post WWII USA and post Cold War USA, when America was punched through as an undisputed global superpower). We are a looooonnng…

> Modern life for middle class or poor class people is a lot better than the vast majority of history

I 100% agree with you.

I'm upper middle class and I live better than any king or any robber baron ever lived up until the early 20th century.

Better dental care, better surgical operations (which saved my life when I was 18 or so btw and which save my daughter the day she turned 7 years old btw), better car, better soundsystem, better clothes, etc.

We also know a more lot about what's healthy and what is not. Personal hygiene, including of those you have intimate relation with...

> Like seriously, would you desire to go back in time to 1890?

No. Not as a king. Not as the richest man on earth.