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Degrees of Wealth

jaapgrolleman.com

71–80 of 85 posts

Re: Degrees of Wealth

#71

Earlier quoted context omitted.

Wealth != power But you hit on an important point that wealth cannot accumulate unless consumption is disciplined. Sometimes discipline is self-imposed (e.g. calvinists), other times by the organizing authority (e.g. state, church). In the 2nd type, authority as the source of discipline, there’s debate on the right balance of disciplining the elite classes vs the under classes. This debate will never cease, as long a…

Can you elaborate please?

I’ll simplify a lot here but here’s my understanding of wealth.

Wealth has lots of flavors but usually we mean material wealth.

Material wealth is the items and properties that people covet. And people figured out they can store wealth with money and everyone agreed that money is a fair way to store wealth and use it to transfer ownership of the items and properties people covet. (In hindsight maybe not wisest of all decisions but open for debate).

Material wealth is not permanent. It is consumed. By typing on my iPhone, using it daily, it’s degrading, eventually it’ll not be functional and it’ll be harder to get money in exchange for it. Real estate appreciates in monetary value but that’s an effect of the money system not a natural state of things, real estate actually degrades without real work put in to keep it up, consuming value. Food and fuel are easy to see as consumables, one-time use only.

Calvinists are historically frugal, their theology emphasizes thrift and industry, basically the backbone of capital accumulation - create wealth, but don’t consume it, invest the wealth to create more wealth. This is the bedrock of “capitalism” (capitalism in modern and postmodern age has taken a new meaning, but originally it meant ~using capital to create wealth).

China famously imposed (and still does) very strict discipline on consumption, and they used their excess capital to reinvest for industrialization.

Western economies imposed consumption limits in the continental wars, which enabled a huge surplus of wealth in USA following WW2 because the population was used to the discipline.

Churches (Vatican) accumulate treasures by disciplining their flocks to tithe. Churches in the east were looted by the Bolsheviks to finance their revolution, the eastern church had huge reserves of wealth that was consumed by the revolution. Eventually they had trouble balancing their economy and the holodomor took hold in the wheat belt - the wealth was exhausted.

The soviets eventually established absolute control, disciplined their populations and went on a long run of impressive industrialization and growth - but it eventually toppled due to imbalances in production and consumption, people don’t thrive under strictest disciplines, they grew tired and the economy got sick.

Today, the highly developed nations in the west are wrestling with questions of discipline. Wealth inequality its called. There’s an upwelling of popular sentiment that people want to consume more, and it’s hard not to sympathize with that, Id love to live like the elites do. But from my perspective there’s not much consideration to how much consumption is sustainable or desirable.

The key question from my view is what end does material consumption serve?

Is it for pleasure’s sake alone? Or is it to unlock more human talent? Is it converted to unleash other flavors of wealth such as spiritual fulfillment, thriving families, arts, wisdom? How can a material value be placed on these things in balance with real material constraints? More questions than answers, and that’s sort of the crux of the eternal argument.

Obviously things have gone well in the west, most people live lives of extreme wealth compared to their great-grandparents. Some of that has to do with warfare, some with luck, some with thrift and industry. Maybe that’s about to change, or maybe not. I for one am happy to work harder than most to create wealth, I find work fulfilling, but I am also well compensated for my labor and so I consume more than most people too… the balance happens at the micro-level and the macro.

Re: Degrees of Wealth

#72
post #56

Earlier quoted context omitted.

I don't know about billionaires, but I do know couples who between the two are earning nearly a million dollars per year - yet because their spending has grown to match their income they are stressed about having enough food to eat the last few days of every month - even worse than poor people I know who have almost nothing. Sure they both are driving new cars, living in a large house (near mansion?), their kids are…

I don't understand the point of your comment. Am I supposed to feel sorry for the irresponsible upper middle class who spent themselves into debt? Do you think that equates at all to actually poverty?

No. You are supposed to understand them, and why despite having so much more wealth they often really do feel like they are in real poverty.

I don't have sympathy for them either. I'm working hard enough to make my own [slightly] more modest life balance and wishing I had some of the toys they do, but I can't afford.

Re: Degrees of Wealth

#73
post #15

Earlier quoted context omitted.

Wealth is objectively a poor measure of a good life, past a threshold. Scientific studies have shown that yes, up to a level of wealth (e.g. being able to not worry about food, shelter, and future security), improving wealth improves happiness. After that, reported levels of happiness do not really change with wealth.

>up to a level of wealth (e.g. being able to not worry about food, shelter, and future security), Assuming future security means affording cutting edge healthcare, this puts you in the 95th, if not the 99th, percentile of the world.

Not if you life in a first world country that provides universal healthcare.

Re: Degrees of Wealth

#74
post #15

Earlier quoted context omitted.

Wealth is objectively a poor measure of a good life, past a threshold. Scientific studies have shown that yes, up to a level of wealth (e.g. being able to not worry about food, shelter, and future security), improving wealth improves happiness. After that, reported levels of happiness do not really change with wealth.

And better studies later have shown that the threshold is just the knee in a log curve. Happiness improves with wealth on a logarithmic scale.

After the knee wealth is not the major factor in happiness, other factors take over like friends, relationships, weak tie relationships, etc etc etc. If you want to be happy optimizing for wealth only makes sense under the knee.

After that, it's other factors, and extreme wealth may even harm those due to inequality.

Re: Degrees of Wealth

#75

This is an insightful article but it misses the elephant in the room, which is wealth inequality . In Shanghai, there is vastly more wealth inequality than in Netherlands. The reason why nannies are affordable in China is because those nannies aren't paid very much, and consequently enjoy a much lower standard of living than their employers. In Netherlands, nannies are relatively expensive, but you the employee is mu…

And that in a communist country...

Re: Degrees of Wealth

#76
There are cost externalities that generally unaccounted for- maintaining an underclass paid subsistence wages or using disposable products that as a society you eventually have to grapple with.

Re: Degrees of Wealth

#77

This is an insightful article but it misses the elephant in the room, which is wealth inequality . In Shanghai, there is vastly more wealth inequality than in Netherlands. The reason why nannies are affordable in China is because those nannies aren't paid very much, and consequently enjoy a much lower standard of living than their employers. In Netherlands, nannies are relatively expensive, but you the employee is mu…

I do worry that the “app / gig economy” independent contractors with weak i9 verification is basically trying to import the developing-world inequality permanent underclass service sector here.

basically, yeah.

in Canada they use Temporary Foreign Workers, but it's the same idea. Import the developing world inequality instead of using locals -- but only because the population base isn't there.

Re: Degrees of Wealth

#78

In Denmark we briadly call this distinction "the good life" (det gode live). Children are usually made to write something (an essay mostly) about it during their last few years in public school. The concept is exactly the philosophical implications of what a "good" life even is. How you can maintain and sustain a "good" life in a world where everyone else is trying to do the same. How your "good" life will sometimes…

Wealth is not a terrible measure of good life. "Money does not bring happiness" is a trope that rich people would like poor people to believe. I don't think poor people fall for it, though.

Money buys convenience and comfort, but it does not buy friendship, belonging, love, virtue, or purpose. The latter have usually been seen as more essential to the good life.

You can look at the wealthy and get a sense of this. A lot of the artistic output of the 1920s was from rich people who had realized this: "Catcher in the Rye" is about a rich kid who finds life meaningless, and "The Great Gatsby" kills himself when he can't get love. (I think a lot of the current malaise comes from the rich people ["elites"] of that era discovering their meaningless existence--hence Postmodernism, and the rest of us buying into their assessment.) Trust-fund kids are known to go off the rails. The English upper class had a purposelessness (see Dorothy Sayers' main character of her mysteries, a the guy that Jeeves' serves; both again from the same period). In our own day, Elon Musk seems like a guy who is running around like mad, subconsciously covering the emptiness inside. Or our own culture, which is the wealthiest in the history of the world, yet we have rampant ADHD, depression, anxiety, and widespread drug abuse (I see more marijuana dispenseries than liquor stores--we cannot even relax without drugs).

Re: Degrees of Wealth

#79

Earlier quoted context omitted.

And better studies later have shown that the threshold is just the knee in a log curve. Happiness improves with wealth on a logarithmic scale.

There's a dramatic difference in having the kind of money that allows you to look forward to retirement and having the kind of money that allows you to alleviate the boredom of you and your closest 5 friends by taking a 6 week retreat to Bali.

A six week retreat to Bali might alleviate the surface boredom, but it will just self-medicate the emptiness that causes the boredom, though.

Re: Degrees of Wealth

#80
post #49

This is an insightful article but it misses the elephant in the room, which is wealth inequality . In Shanghai, there is vastly more wealth inequality than in Netherlands. The reason why nannies are affordable in China is because those nannies aren't paid very much, and consequently enjoy a much lower standard of living than their employers. In Netherlands, nannies are relatively expensive, but you the employee is mu…

While it's true that a lot of China's conveniences come from essentially labor market arbitrage and rural/urban inequality, the fact that the Netherlands can afford to attempt to reduce wealth inequality is a sign itself that it's a very wealthy country. I would also prefer the pace of life in the Netherlands, but I wonder to what extent you also have to buy more fairness and a slower pace of life?

> attempt to reduce wealth inequality is a sign itself that it's a very wealthy country

Poor countries also reduce wealth inequality. In fact, China went through a Communist revolution where all private landowners’ wealth was taken from them. This happened from the 1930s through the 1950s and was a fairly bloody, violent process, involving lots of revolutionaries inciting peasants to forcibly occupy land and buildings and killing landlords if they didn’t cooperate.

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