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Why Inequality Matters

gatesnotes.com

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Re: Why Inequality Matters

#71

Post by Retric »

saalweachter wrote: post #42
r0h1n wrote: post #10

I must say Bill Gates, in his post Microsoft avatar, continues to surprise me constantly. This is a refreshingly candid and sanguine review of Piketty's book from someone who was a ruthless capitalist not so long ago. Gates rightly (and self-servingly) also points out that Piketty does not consider philanthropy as a means to correct some of capitalism's imbalances. Here's a few of Gates' conclusions: > Piketty is rig…

The problem with differentiating between the "good investor" and the "lavish lifestyle guy" is that the good investor is actually the one that you (rather, Piketty) need to be most worried about. People worried about inequality aren't (just) worried about the morality of consumption -- a fat cat sitting atop a mountain of cash drinking champagne and eating caviar while the peasants starve. They're worried about maint…

As an example of that theory in action. Rupert Murdoch bought Fox broadcasting and both makes money from in and puts forth his personal ideology. Arguably he might have made more money with other investments, but it's been a vary solid investment. Monsanto is not just a major agricultural company they actively lobby for stronger patents. At a more pervasive level 'Climate Change' is not just science it's become a political debate with well moneyed people and organisations actively trying to influence things.

Re: Why Inequality Matters

#72

Post by JoeAltmaier »

PythonicAlpha wrote: post #67

Must be some American specialty. At the end, Bill Gates sees Philanthropy as (part of a) solution. This must have something to do with the US-American history and background? I heard that opinion so often and we are in deed in an era of big philanthropists (like Bill himself). But I (no American, and maybe missing some genetics for it) can not see any solution in it. The biggest philanthropists today are in the US, b…

Philanthropy is many things. It includes emergency aid, which by no means makes people addicted to aid. It includes schools and scholarships which are doing what you ask - leveling the opportunities.

Where philanthropy fails is when its not matched to cultures. Building schools for girls in countries that won't tolerate that - they get closed soon after you leave. Or educating local doctors, who immediately leave the country for a better job in America.

But what can philanthropists do? You can't make people change to suit your goals.

Re: Why Inequality Matters

#73

Post by crdoconnor »

Shinkei wrote: post #39
r0h1n wrote: post #10

I must say Bill Gates, in his post Microsoft avatar, continues to surprise me constantly. This is a refreshingly candid and sanguine review of Piketty's book from someone who was a ruthless capitalist not so long ago. Gates rightly (and self-servingly) also points out that Piketty does not consider philanthropy as a means to correct some of capitalism's imbalances. Here's a few of Gates' conclusions: > Piketty is rig…

The problem with any consumption tax is that wealthier people spend a smaller percentage of their income on needs compared to lower classes. If you make it progressive, they will just buy their most expensive items overseas and never (or hide?) the import and avoid the tax. Anytime you try to regulate, there will be people making big money trying to find workarounds. Anyway, taxing in this way imposes a moral judgeme…

>I work a lot of hours and my payroll taxes are much higher than capital gains taxes--as Buffett and others have pointed out, that's what's unfair but it won't change as long as the people who get their income from capital gains have the most power to influence politics.

They only have that power because the rest of the country is disorganized/divided and un-unionized. There's more than us than there is of them. Ultimately they will cede this power at some point - the question is simply when.

Re: Why Inequality Matters

#74

Post by enraged_camel »

jasode wrote: post #53
couchand wrote: post #44

Earlier quoted context omitted.

Why do people always use the term punish when talking about taxes? Taxes are levied, you're only punished if you fail to pay.

Please don't add noise to the discussion by nitpicking something that doesn't need to be nitpicked. Shinkei already put scare quotes around the word "punished" so any reasonable person should interpret that he does not mean "punish" in a formalized legal sense. His usage was a figure-of-speech and not citing any legal doctrine. People can use punish the same way people can use reward when then say they felt "rewarded…

I think you're being a bit too harsh on couchand. First of all, I didn't interpret his comment as attacking Shinkei. I think he posed it as a general question for the audience. Secondly, I don't see it as nitpicking. It's a reasonable discussion to have. Piketty himself spends a fair amount of pages discussing how a global wealth tax might be implemented, and people's attitudes towards taxation in general have to be part of that debate.

Re: Why Inequality Matters

#75

Post by tormeh »

saalweachter wrote: post #42
r0h1n wrote: post #10

I must say Bill Gates, in his post Microsoft avatar, continues to surprise me constantly. This is a refreshingly candid and sanguine review of Piketty's book from someone who was a ruthless capitalist not so long ago. Gates rightly (and self-servingly) also points out that Piketty does not consider philanthropy as a means to correct some of capitalism's imbalances. Here's a few of Gates' conclusions: > Piketty is rig…

The problem with differentiating between the "good investor" and the "lavish lifestyle guy" is that the good investor is actually the one that you (rather, Piketty) need to be most worried about. People worried about inequality aren't (just) worried about the morality of consumption -- a fat cat sitting atop a mountain of cash drinking champagne and eating caviar while the peasants starve. They're worried about maint…

I just want to say that I agree with you in a more weighty manner than an upvote.

Re: Why Inequality Matters

#76

Post by taeric »

bsbechtel wrote: post #58
taeric wrote: post #47

Earlier quoted context omitted.

Seems like a very small amount of evidence to base such a large idea on. You could probably form the same argument against the more modern consumption taxes. Since for many this translates to a sales tax, and not the early excise taxes that are covered under the same category. (Right?) Though, your argument falls more heavily on the mistake Gates seems to have also made. The type of wealth that the book refers to as…

>Seems like a very small amount of evidence to base such a large idea on. I acknowledge this. Keep in mind though that in economics it is extremely difficult to comprehensively analyze all the data relevant to your stated hypothesis. Gates points out several areas where Piketty's data falls short, and the amount of data Piketty collected and analyzed for his book is considered one of the strongest points of his thesi…

I think some of Gates criticisms fall in the arm chair category of criticisms on this, honestly. (And to be fair, I know mine do.) I have no desire to silence any of them, and I am excited about seeing them debated. But, I am fairly skeptical about how good they are.

I am genuinely interested in any discussions on this. Though, I will probably duck out of it soon, as it is beyond me. Please keep it going.

Regarding the investments, I am really talking about individual investors more than the companies. Find me someone with a couple hundred k in investments, and I posit you have found someone that will remain wealthy for some time. Probably long enough to pass it on to their children. Find me someone with a million in investments, and I am even more sure. More, they are in a position to make it so that most dollars they spend directly relate to some more dollars they will make.

I believe you are correct, historically. However, in recent times the wealthy are more and more made up from people that invested well. Pretty much period.

Consider your average home buyer. (Well, scratch that, consider your average successful home buyer.) The banks and lenders gain more from the purchase than the purchaser does. By a pretty large margin. If we look at the ones that go bust, this is even more true.

I agree that we don't need to tear down successful folk. I'm just not sure I've heard any plans that successfully help the less successful ones.

Re: Why Inequality Matters

#77

Post by crdoconnor »

bsbechtel wrote: post #12

>High levels of inequality are a problem—messing up economic incentives, tilting democracies in favor of powerful interests, and undercutting the ideal that all people are created equal. I agree with generally all of Gates' thoughts here, but there are two actors to consider when discussing how to address problems associated with inequality - the government, and those who own capital. There is an implicit assumption…

>The other option is to limit the power the government has to control the flow of wealth.

That's one of the core ideologies UNDERLYING the great shift in wealth from poor to rich: that politics should have no say in wealth allocation.

What that ultimately means is that the rules of wealth allocation are decided by the wealthy without democratic oversight.

Hence here we are.

Re: Why Inequality Matters

#78

Post by PythonicAlpha »

JoeAltmaier wrote: post #72
PythonicAlpha wrote: post #67

Must be some American specialty. At the end, Bill Gates sees Philanthropy as (part of a) solution. This must have something to do with the US-American history and background? I heard that opinion so often and we are in deed in an era of big philanthropists (like Bill himself). But I (no American, and maybe missing some genetics for it) can not see any solution in it. The biggest philanthropists today are in the US, b…

Philanthropy is many things. It includes emergency aid, which by no means makes people addicted to aid. It includes schools and scholarships which are doing what you ask - leveling the opportunities. Where philanthropy fails is when its not matched to cultures. Building schools for girls in countries that won't tolerate that - they get closed soon after you leave. Or educating local doctors, who immediately leave the…

I don't say, that philanthropy is bad.

What I mean: Philanthropy does not help, when the reasons of poverty are not removed. Biggest philanthropy will not help, when it is the result of extreme redistribution of money. The philanthropy of the monks in the middle ages did not help, because the monks where part of the system of inequality, where few owned all and the rest had to live on .... sometimes philanthropy.

Re: Why Inequality Matters

#79

Post by mkempe »

Gates, and Piketty, would benefit from considering the insights of the Austrian school of economics, instead of accepting then regurgitating Marx & Engels with a veneer of civilized discourse. Neither seems to have read a single page of Ludwig von Mises or Eugen von Böhm-Bawerk. Piketty certainly quotes Marx ad nauseam.

George Reisman has offered a thorough critique [1] of Piketty's arguments -- arguing across a range of topics, from David Ricardo's insights in the role and formation of capital to the meaning and value of inequality in both income and wealth.

[1] http://georgereismansblog.blogspot.com/2014/07/pikettys-capi...

Re: Why Inequality Matters

#80

Post by radmuzom »

saalweachter wrote: post #42
r0h1n wrote: post #10

I must say Bill Gates, in his post Microsoft avatar, continues to surprise me constantly. This is a refreshingly candid and sanguine review of Piketty's book from someone who was a ruthless capitalist not so long ago. Gates rightly (and self-servingly) also points out that Piketty does not consider philanthropy as a means to correct some of capitalism's imbalances. Here's a few of Gates' conclusions: > Piketty is rig…

The problem with differentiating between the "good investor" and the "lavish lifestyle guy" is that the good investor is actually the one that you (rather, Piketty) need to be most worried about. People worried about inequality aren't (just) worried about the morality of consumption -- a fat cat sitting atop a mountain of cash drinking champagne and eating caviar while the peasants starve. They're worried about maint…

Great comment. Also, those of us who fight against inequality are not fighting for equality at all.

What we say is simple - if you have a million dollars and 100 people to share it - rather than 1 person have 990,000 and the remaining 10,000 divided among 99 we want the 1st person to have 800,000 and the remaining 200,000 to be divided among the 99. That way, the first guy can have his $5,000 wine without paying any extra tax while we have our $50 wine. In the first scenario, the first guy still gets his $5,000 wine but the remaining can barely afford two meals a day.

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