Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Wealth: The Toxic Byproduct (2013)

meltingasphalt.com

Post reply on HN
Print view View original

121–130 of 149 posts

Re: Wealth: The Toxic Byproduct (2013)

#121

Post by pesmhey »

SilasX wrote: post #117
pesmhey wrote: post #111

Earlier quoted context omitted.

To follow the food analogy, I'm saying that you've gotta eat to have energy to be productive to make food to eat. In other words, you have to produce in order to consume in order to produce in order to consume, and so on. The worst possible thing would be consumption sans production - that's cancer. Can you think of examples where you would produce without consumption? I can't think of any. Even intellectual discover…

Needing to consume is a complication from the core insight. If necessary, replace with someone who consumes at subsistence level. - Person A works X amount, and consumes typically. - Person B works X amount, and consumes at subsistence. Judging solely from the perspective of other people, which person is better to have? Or, for another example, the sun produces without (economically-relevant, purchased) consumption.…

Between person A and B, the 'better' person to have would be the one who produces more valuable stuff. Better is a tricky way to talk about this though, because these two people might have different inherent capabilities. The most ideal answer would be that person A and person B should each find their ecological niche where their consumption and production of resources are in optimal balance. The 'better' person to have in this case would be the person most suited to your same niche.

If your statement had been 'produces X amount', and not 'works X amount', then my answer definitely changes. Less consumption for the same amount of production is always better, because in aggregate it means more resources for consumption, and production goes up. Or maybe not? I'd be interested to think about a good counterpoint.

Even the sun consumes - it consumes hydrogen, helium, lots of stuff. And that stuff is localized to the sun. Perhaps we'll figure out a way to add fuel from somewhere else to the sun one day, but as of right now, the sun consumes an ultimately limited amount of stuff. We have a pretty decent understanding now of the relationship between the sun's consumption and production of resources.

If someone were like the sun, and charged for sunlight, then they would HAVE to spend the money on acquiring more hydrogen. If they left the money in the bank, then they wouldn't be able to produce the sunlight that earns them money.

Re: Wealth: The Toxic Byproduct (2013)

#122

Post by marnett »

airstrike wrote: post #75
marnett wrote: post #40

Earlier quoted context omitted.

You began by comparing Bill Gates to us as consumers, but ended comparing him to an institution, of which he is. His personal wealth is managed by a private investment company, and his impacts on the economy are matched only by others of equal diversified wealth, world governments, and other powerful institutions. Bill Gates being one man with the power of governments and institutions is the inequality we are all tal…

Did you create the same value to society as Bill Gates? So why do you think you deserve the same wealth?

My comment was specifically pointing out that measuring inequality should not be based on how much one could potentially consume, but (obviously) the extreme power they derive from their wealth. GP did a good job at explaining how wealth can result in extreme domestic and international power (by using their wealth to impact/drive economic initiatives, etc).

So to tie it all together - if we believe in the American democratic project we are running, I deserve the same amount of domestic political power as any other civilian, not necessarily the same wealth. However, if wealth acts as a power multiplier (as we just discussed), than, naturally, wealth inequality results in democratic inequality and needs to be acknowledged in order for democracy to work.

Unrelated to my point, but in response to your question: Wealth (especially the wealth Bill Gates has acquired) comes from creating value for shareholders, not society. Do not conflate those two things.

Re: Wealth: The Toxic Byproduct (2013)

#123

Post by SilasX »

pesmhey wrote: post #121
SilasX wrote: post #117

Earlier quoted context omitted.

Needing to consume is a complication from the core insight. If necessary, replace with someone who consumes at subsistence level. - Person A works X amount, and consumes typically. - Person B works X amount, and consumes at subsistence. Judging solely from the perspective of other people, which person is better to have? Or, for another example, the sun produces without (economically-relevant, purchased) consumption.…

Between person A and B, the 'better' person to have would be the one who produces more valuable stuff. Better is a tricky way to talk about this though, because these two people might have different inherent capabilities. The most ideal answer would be that person A and person B should each find their ecological niche where their consumption and production of resources are in optimal balance. The 'better' person to h…

>If your statement had been 'produces X amount', and not 'works X amount', then my answer definitely changes. Less consumption for the same amount of production is always better, because in aggregate it means more resources for consumption, and production goes up.

Yes, this is what I meant, and what you get from interpreting it charitably.

>Even the sun consumes - it consumes hydrogen, helium, lots of stuff.

Which is why I, anticipating that remark, added the bit about "economically-relevant, purchased" -- it does not consume in the sense meant in economic discussions. It does not purchase goods on the market that then deprive someone else of having them. The sun is not an actor in the economy that has to buy hydrogen to fuse together, so economically it's just like someone who throws off good things for free.

Re: Wealth: The Toxic Byproduct (2013)

#124

Post by ivalm »

tristor wrote: post #6

This article is an interesting thought experiment, but I can't help but feel that the statements made are in such opposition to understood economic principle and call into question basic moral precepts. That doesn't mean it's wrong, it just feels alien to read. As an example of what I mean, the idea of consumption being a net-negative destructive action goes against the economic concept of velocity of money and how t…

The article has a lot of problems. It tries to conflate "net producer"="net saver"="morally good" but this is not clear at all.

1. If everyone is a net saver you get paradox of thrift [0].

2. For every buyer there is a seller. Being a net seller depends on somebody being a net buyer... it is strange to say "i am moral by depending on somebody being immoral"

3. As others pointed out, distribution of wealth is a critical component as it grants influence multipliers to people. It is easy to pigeon hole majority into having no money (and thus no spending choice) by hoarding all of the money (especially when the "service" you offer is arbitrage, which doesn't increase net real commodities).

4. Rather than thinking about producers/consumers, it is probably more useful to think in terms of utility [1]. Spending money can increase overall utility (most clearly -- direct investment in a utility increasing business). The growth in overall utility can actually increase total production (which the author equates with "good") despite his argument totally missing this.

[0] - https://en.wikipedia.org/wiki/Paradox_of_thrift [1] - https://en.wikipedia.org/wiki/Utility

Re: Wealth: The Toxic Byproduct (2013)

#125

Post by ivalm »

yholio wrote: post #64
illumin8 wrote: post #47

Earlier quoted context omitted.

I agree. I was in agreement with the article when it says that money we earn is a statement of the value we provide to society, so earning money is good, however, I don't agree with the statement that spending money and consumption is bad. The example of the yacht is rather contrived as well. They talk about how all of the craftsmen and lumber workers had to chop down, dry, age, cut and polish the wood to make the ya…

> the money used to buy that yacht paid the salaries and income of all the craftsmen and laborers that built it for you, compensating them for the value they provide to society. The point he is making is that they are compensated but no net value is returned to society as a result of their labor and resource expenditure. The yacht "disappears" in your private marina where it will rot away providing you with a purely…

Perhaps "labor value" would disappear but it grants workers "spending choice" which generates "happiness" (workers can spend money on luxuries), "influence" (middle class is more capable of political action that subsistence farmers), allows for further downstream effect to increase production capacity (additional capital investment into yacht building business). Basically, there is much more to life than labor value and exchange media have effects other than shifting around labor value. At any rate, there is something fundamentally wrong suggesting that either party in exchange is more moral than other since for every buyer there is a seller, and i don't buy that someone can say "i am moral because i exchange with someone who is immoral."

Re: Wealth: The Toxic Byproduct (2013)

#126

Post by aidenn0 »

TomMckenny wrote: post #113
pesmhey wrote: post #63

Earlier quoted context omitted.

Money is a measure of social value. Your status in the tribe is highly dependent on your utility to the tribe, and that utility is highly-dependent on how well you work with other members of the tribe to achieve common goals. If you are more effective than your neighbor at advancing community goals, then you will have a higher social value than your neighbor. When we were just tribes of 150-200 humans, our minds were…

Except money is inheritable and genuine social value is not. Indeed, since some 50% of wealth is now owned by about 1% of the population, it is clear that a vast percentage of wealth is now obtained through inheritance.

I note you say "genuine," but in many cultures perceived social value is definitely inheritable.

Re: Wealth: The Toxic Byproduct (2013)

#127

Post by fragsworth »

airstrike wrote: post #71

> The yacht is made of wood, metal, and plastic. Building it requires many thousands of hours of effort. Workers have to find the trees, cut them down, haul the lumber across vast distances, cut it, sand it, polish it, paint it, etc., etc., etc. If you weren't commissioning the yacht, all of those materials and man-hours could be put to other, better uses. For all the good it does the Congolese people, you may as wel…

I think you're missing something about Utility - specifically that ethically, if we're going to talk about this notion of utility, we should increase aggregate utility (the sum of utility of all people).

The utility of money to a single individual decreases as the individual acquires more money, i.e. utility of money is higher for poor people and lower for rich people. This notion applies directly to the things purchased by that money. The aggregate utility (benefit to humanity) of a yacht that a single individual purchases is therefore far lower than the aggregate utility of a bunch of smaller things that are purchased by a bunch of less wealthy individuals.

And then what follows from that is by purchasing yachts, you are promoting an industry that lowers aggregate utility. It can be argued that if you're going to "feel bad" about money, this spending is what is the potentially unethical part, which was the author's point.

Re: Wealth: The Toxic Byproduct (2013)

#128

Post by pesmhey »

SilasX wrote: post #123
pesmhey wrote: post #121

Earlier quoted context omitted.

Between person A and B, the 'better' person to have would be the one who produces more valuable stuff. Better is a tricky way to talk about this though, because these two people might have different inherent capabilities. The most ideal answer would be that person A and person B should each find their ecological niche where their consumption and production of resources are in optimal balance. The 'better' person to h…

>If your statement had been 'produces X amount', and not 'works X amount', then my answer definitely changes. Less consumption for the same amount of production is always better, because in aggregate it means more resources for consumption, and production goes up. Yes, this is what I meant, and what you get from interpreting it charitably. >Even the sun consumes - it consumes hydrogen, helium, lots of stuff. Which is…

Burning hydrogen today deprives the market of 5 billion years from now. I'm not trying to be pedantic. Nothing throws off good things for free.

I think what we're both touching on here, and what the article touches on as well, is the question of what happens when the accumulation of wealth becomes so great, that it's utility becomes almost incomprehensible. We know the sun consumes matter, but to speak of the markets 5 billion years from now is so incomprehensible, that the energy produced today might as well be 'free'. The discussion stops being an economic one and turns into a religious one.

To bring it back to the article, what I understand you to be saying is, what if the Congolese Trading Window had opened into the living room of someone who could throw off good things for 'free'. They won't purchase goods that deprive someone else of having them. So basically, a never-ending flow of rice comes out of this window. This person, or even just the window if there's no person attached, literally becomes a god. It's why the sun has been worshiped. It's why feudal lords had the honorific 'lord'. The disparity in wealth between a parent and child is so great that religions have used the terms 'mother' and 'father' to describe nature and deities. A King's Divine Right. The Emperor's Mandate of Heaven. We could find others I think.

In all of these cases, there is still consumption of resources to produce something, just that the scale at which this happens is beyond the realm of understanding for the end-user. We have a decent idea that the sun will be burning in however many billion years, but will markets exist? No clue, so yeah, it's 'free'. Before we knew these facts, it was grounds for worship, but now, we just know it as physics.

You asked if I thought if to produce without consuming was the worst possible thing, and then mentioned that the need to consume was missing the core insight. What is your answer to your question?

Re: Wealth: The Toxic Byproduct (2013)

#129

Post by pesmhey »

aidenn0 wrote: post #126
TomMckenny wrote: post #113

Earlier quoted context omitted.

Except money is inheritable and genuine social value is not. Indeed, since some 50% of wealth is now owned by about 1% of the population, it is clear that a vast percentage of wealth is now obtained through inheritance.

I note you say "genuine," but in many cultures perceived social value is definitely inheritable.

You end up getting a class of people who's social value is inheritable. They typically serve ceremonial and liturgical roles. This is all generalization, of course, but I would consider this to be the rule, not the exception. Cultures stratify.

Re: Wealth: The Toxic Byproduct (2013)

#130

Post by afgioionio »

ganonm wrote: post #31

"The point is, money spent on consumption is toxic — value-destroying" This is something I've been thinking about a lot recently. Surely when comparing inequality in societies, what we really care about is consumption. Singling out billionaires as an example of how unequal our society, I feel, is disingenuous. How much more does Bill Gates really consume than your 'average Joe'? Sure, he presumably eats good food, we…

https://en.wikipedia.org/wiki/Bill_Gates%27s_house

Bill Gates lives in a $147 million home. He spends far more than ten times as much as the average person.

Post reply on HN