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Why Inequality Matters

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Re: Why Inequality Matters

#231

Post by chippidysan »

mkempe wrote: post #79

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 rang…

The majority of these comments are "tax the rich!" with no regard to current government spending trends. Oh and the obligatory, "BUT WHO WILL BUILD THE ROADS!?"

Re: Why Inequality Matters

#232

Post by mchusma »

michaelvkpdx wrote: post #198

I appreciate Gates' analysis of Piketty, but Gates is still blind to an important point- he came from a middle-class background and therefore had enough capital to gain a footing in the world and to be able to write his initial code without worrying about the basic needs of survival. 40% of youth in the USA today do not even have that, and as such, have virtually no chance at all of being able to even play in the cap…

You paint the most damning portrait of America I've ever heard, can you help flesh this out?

Can you source your 40% figure? The only child poverty number I found is 21.8% for 2012. [1]

For those in poverty, can you provide more insight to why you think they have "virtually no chance at all of being able to even play in the capitalist economy"? I think everyone would agree they are at a disadvantage, but there are several people on the Forbes 400 this year who came out of poverty. Both of my parents came out of poverty, even you said you made it out of poverty.

Can you provide some anecdotal insight to your peers who fell "prey for the tech titans, who fill their eyes with glittery visions that make them forget their hunger and cold."

[1] http://web.stanford.edu/group/scspi/sotu/SOTU_2014_CPI.pdf

Re: Why Inequality Matters

#233

Post by r00fus »

forgingahead wrote: post #98
saalweachter wrote: post #42

Earlier quoted context omitted.

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…

Currently, 436 people (Reps, Senators and President) control nearly 4 trillion dollars, the budget for this year. What should we do about them?

Your number is way off (435+100+more than 1 executive branch), and furthermore, if you don't follow the money that influences these actors (lobbying, revolving door, non-blind blind trusts, etc) then you don't really understand what or who is driving those decisions.

Fighting politicians is like whack-a-mole - even if you get rid of bad ones, the replacements are often just as corrupt as the ones that got replaced.

Fight the corruption first.

Re: Why Inequality Matters

#234

Post by Balgair »

Taek wrote: post #177
saalweachter wrote: post #42

Earlier quoted context omitted.

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…

One thing that always bothers me about wealth distribution is that you can't simply move wealth around and expect things to get better. People who have wealth are going to be better with that wealth than people who don't. They grew up with wealthy people, have managed the wealth for a long time, have witnessed mistakes and successes, and overall have spent a lot of time contemplating wealth. If you take that wealth a…

Ok, lets assume you are correct: Experience beggars experience. Those with know how of Russian should speak Russian, those with know how of car will fix cars, those with money shall decide what to do with money.

Obviously we don't live in a world nearly static enough for this to occur. If so then the Zuck never would have made FB nor Carnegie would have left Ireland and we all would be worse off for it. Yes, these are historical issues. Lets try a future one.

Assume that Pablo is a UPS driver. Pablo notices that many times when he has to turn left to make a delivery, he spends a lot of the time waiting at a red left turn arrow light. Pablo, needing to make his metrics, decides to cross intersections and make Uturns and rights and all other sorts of maneuvers. Pablo shares his insights with his co-workers and friends. Everyone benefits from Pablo's insights, more packages are delivered, the company spends less fuel idling, everyone makes their metrics, etc.

Now in a world where the path was designed by Paco up at headquarters, Pablo could not make those alternative turns. If he did, he would have violated the paths that Paco designed and he would have faced repercussions. Why? Because Paco knows more than Pablo and Paco is the one responsible for designing the routes. You assume Paco has superior know how and experience and will be better. But Paco is just a man like everyone else, he makes mistakes and didn't see what Pablo was doing was beneficial. Not through malice, but just because Paco looks at google maps all day, not actual light cycles. It wasn't Paco's fault, nor was it Pablo's. It was just an oversight.

But in a world where we do not assume that the most experienced are also flawless, Pablo took it upon himself to fix the problem, and everyone is ok with that.

Multiply this example by thousands and you have a sense of what is going on out there. Also, sprinkle in some greed, malice, lies, sex and drugs, and all the other deadly sins and you get why we need democracy. It's because we all screw up, but if we screw up at least we can get each other out of it.

Re: Why Inequality Matters

#235

Post by smutticus »

Taek wrote: post #177
saalweachter wrote: post #42

Earlier quoted context omitted.

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…

One thing that always bothers me about wealth distribution is that you can't simply move wealth around and expect things to get better. People who have wealth are going to be better with that wealth than people who don't. They grew up with wealthy people, have managed the wealth for a long time, have witnessed mistakes and successes, and overall have spent a lot of time contemplating wealth. If you take that wealth a…

One of my favorite Churchill quotes is, "The best argument against democracy is a 5 minute conversation with the average voter."

You're position isn't all that strange, and it does cut right to the heart of the issue. Do we really want to live in a democratic society?

Part of the problem with addressing this question is that we've generally agreed the answer is, 'Yes'. Even if we're not always willing to fully live that way. No one wants to be labelled as undemocratic, non-westerners get their countries bombed when they get that label.

Another problem with this question is that the other systems of governance we've tried have mostly been worse. When you start trying to figure out how some people can have more say than others based on their merit you inevitably end up picking winners based on something other than general merit.

Who gets to be more important than the rest? How do you hold them accountable as a class if they're the only ones that can ever hold the reigns of power?

I appreciate your honesty about this, but your opinion also scares me. Because there is no way to achieve your perfect world without privileging the rights of some over the rights of others.

I also don't like your comparison of decision making in business to that of decision making in government. In business it is easier to determine good outcomes. If more money is made, we made the right decision. Government involves morality, and outcomes cannot be measured with amoral assumptions of correctness. One person's good outcome in government is another person's bad outcome relative to morality.

You're probably right when you say that the elite are better at holding the reigns of power than the rest of us. It's a very monarchist thing to say, but it's probably right in many contexts.

And like monarchies it's something that I believe we should fight to change. John Dewey recognized this, and made it his prime motivator for compulsory education in the United States. To train citizens for a functioning democracy.

Democracy to me isn't some state that we sit in and relish. It's something we focus on improving through constant education of ourselves and by teaching those around us.

Re: Why Inequality Matters

#236

Post by noarchy »

lmm wrote: post #202
noarchy wrote: post #85

Earlier quoted context omitted.

>This presumes that most, if not all of the money gained by the rich is justly earned. I would take serious issue with this. Case by case, you may or may not have a point. Is the alternative to have the state take the money and spend as it wishes? In such a case, is the money "justly earned" if it was taken by force?

Everything bottoms out at force; most of us consider taxation as just or more so than the way the rich acquire their money. The state is a bit more legitimate than rich individuals because it's more accountable to the people.

>The state is a bit more legitimate than rich individuals because it's more accountable to the people.

That isn't necessarily a universally-accepted idea. Democratic systems have the machinery of accountability, but some of us are not completely convinced that it works; surely not as-advertised.

I know that some will regard the wealth of the rich as having been acquired by some means of trickery or even coercion. And that may even be true in some cases. But it is true of taxation nearly 100% of the time, as states must use the threat of force to acquire that money.

Re: Why Inequality Matters

#237

Post by jeffdavis »

michaelvkpdx wrote: post #198

I appreciate Gates' analysis of Piketty, but Gates is still blind to an important point- he came from a middle-class background and therefore had enough capital to gain a footing in the world and to be able to write his initial code without worrying about the basic needs of survival. 40% of youth in the USA today do not even have that, and as such, have virtually no chance at all of being able to even play in the cap…

"Gates' idea of a consumption tax would heavily penalize these people, who have been enslaved into a consumer lifestyle by the wealthy who exercise control over their lives."

That came out of the blue... can you expand on that? [Note also that Gates said a progressive consumption tax.]

I like a progressive consumption tax because (I currently believe, anyway) that it's harder to avoid than an income tax. Income can happen anywhere in the world, but if you are living here then you are consuming here. You can keep trying to defer income through clever accounting, but that seems harder to do with consumption (if you have a yacht today, you pay taxes today).

It also takes away most arguments about class warfare. A wealthy person can't just call themselves a "job creator" and oppose taxes while floating around on a yacht and running a business into the ground. If they do, it will be obvious the taxes are for their yacht, and not their job-creating ability.

Re: Why Inequality Matters

#238

Post by enoch_r »

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…

Imagine there are two products on the market: "the promise of $130 in 5 years" and "$100 today." The fact that people choose to exchange one product for the other every day suggests that the two products have equal value.[0] Capital gains taxes mean that these two products of equal value are taxed at different rates. Although I work a lot of hours too, I find that quite unfair.

[0] http://en.wikipedia.org/wiki/Time_value_of_money

Re: Why Inequality Matters

#239

Post by masklinn »

michaelvkpdx wrote: post #198

I appreciate Gates' analysis of Piketty, but Gates is still blind to an important point- he came from a middle-class background and therefore had enough capital to gain a footing in the world and to be able to write his initial code without worrying about the basic needs of survival. 40% of youth in the USA today do not even have that, and as such, have virtually no chance at all of being able to even play in the cap…

> Gates is still blind to an important point- he came from a middle-class background

Gates didn't come from a middle-class background but from an upper-class one. His father was a highly successful lawyer and cofounder of Shidler & King (then Preston Gates & Ellis, now K&L Gates), his maternal grandfather was an affluent banker (national bank president) and his mother was a Seattle power serving on the boards of United Way, UW, US West (then Pacific Northwest Bell), First Interstate Bank and others.

Re: Why Inequality Matters

#240

Post by TeMPOraL »

dropit_sphere wrote: post #127
enraged_camel wrote: post #68

Earlier quoted context omitted.

I would posit that it is also a cure, but for the person's conscience. One of the reasons people engage in philanthropy is because it makes them feel good about themselves. This especially holds true for Bill Gates. He was a ruthless capitalist for decades before he realized that's not the kind of legacy he wants to leave behind. (I don't say that to cheapen his efforts -- on the contrary it makes me respect him more…

>You pose a great question though: would philanthropy exist in a well-designed system? I'm convinced that it is only the good faith of enough actors that allows any system to function at all . Every tax or subsidy fixes one problem while creating another. Not to say we shouldn't have them---externalities should be addressed---but that a system "perfectly designed for outcomes humans like" is equivalent to creating st…

> but that a system "perfectly designed for outcomes humans like" is equivalent to creating strong AI that happens to run on a market economy.

Isn't that assuming that "market economy" is something "perfectly designed for outcomes humans like"? I disagree with treating current economic system as something inherently optimal - it has a lot of problems, all of which we can see even today. I agree with the equivalence to creating strong AI, but I don't think it would run on anything close to a market economy we have today.

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