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Never mind the 1 percent Let's talk about the 0.01 percent (2017)

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Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#181

Post by stale2002 »

mistermann wrote: post #168
stale2002 wrote: post #165

Earlier quoted context omitted.

> such things are beyond our ability to measure, we can only speculate. Ok then. But that doesn't support the argument that compensation is too high. Maybe it isn't high enough, and should be even higher! I can use your unknown argument to support even higher compensation, just as much.

> Ok then. But that doesn't support the argument that compensation is too high That is true, but I made no argument. You on the other hand, seemed to be explaining that such arguments are wrong, at least as I understood you. > I can use your unknown argument to support even higher compensation, just as much. Just as much, which is precisely zero. You seem to be claiming that they are producing value, that needs to be…

No, everyone else in the thread was making a bunch of arguements about how CEOs are overpaid. That is the argument that requires justification.

And the only claims that I make, are in response to other claims. I don't need to make any claims, if you aren't going to make any, because I can just stick with the status quo, merely because it is the status quo.

The burden of proof is on the people who claim that the current status quo, of CEO compensation is for some reason, out of line.

Because unless there is some good reason, it probably isn't, for the sole reason that it is the status quo.

Other people are the ones making the claim here, that the current state of the world is for some reason wrong.

It is perfectly fine, and normal, to assume that the status quo, for an arbitrary issue, is ok, in the absence of evidence that it is bad.

The burden of proof is on the people who are claiming that the status quo is wrong, and needs to be changed.

Why? Because in the vast majority of situations, the status quo is the status quo for a reason. Because if the status quo was wrong, then people would probably find a reason to change it, regarding any arbitrary issue.

So I maintain that the burden of proof is on the people who want to change the status quo, not on the people who want to maintain it.

There are a million different ways that we could change the world, and you have to make an argument for why we should make the change.

And I cannot prove a negative here, as for why there are zero bad things about the status quo.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#182

Post by stale2002 »

hannasanarion wrote: post #173
stale2002 wrote: post #131

Earlier quoted context omitted.

The reason is because the future value of a company was a part of his compensation, for creating the company in the first place. There is nothing wrong with selling away the future value of your contributions, or for other people buying the future value of your contributions.

But they aren't Gates' contributions. He doesn't have anything to do with modern Windows operations. Windows 10 was built by people that he never met. Why does he deserve the proceeds of their work? Why does he deserve it virtually tax free? Why does he deserve more than the average MS worker can make in a million years while doing no work himself, just because he owns some pieces of paper? Seriously, you could have…

> Why does he deserve it virtually tax free?

Because as a part of someone's compensation, you can be paid for with future value.

> How can you possibly justify this?

If I want to sell off my future value of my future work, in exchange for someone else's past work, that is my right to do so, that's why.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#183

Post by [deleted] »

rklaehn wrote: post #120
3fe9a03ccd14ca5 wrote: post #93

Earlier quoted context omitted.

> And a fair tax is just too simple. Politicians wouldn't have anything to sell anymore. You’re right! Without the ability to carve out exceptions, why would a powerful lobby need to come with a proverbial suitcase a cash?

The sad thing that just the two parameters basic income and flat tax rate are flexible enough for a wide variety of policies. Want scandinavian style socialism: set the basic income very high and have a high flat tax rate of maybe 50%. Want a more individualist approach: set basic income to the bare necessities and set the flat tax rate to 25%. Want to borrow to fight against a recession, keynesian style: increase ba…

[deleted]

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#184

Post by throw0932 »

Applejinx wrote: post #178
throw0932 wrote: post #176

Earlier quoted context omitted.

Hang on, let me try to understand your point: 1. A computer simulation where wealth is exchanged by chance has power-law behavior 2. Wealth IRL has power-law behavior 3. Therefore, wealth IRL was exchanged by chance (as opposed to skill) Is this what you were saying? If not, mind breaking down what you are saying? Needless to say, the above is affirming the consequent. The exchange mechanism random simulation is mode…

'Therefore' is the only part of that which is unjustified. I'll break it down: 1. The computer simulation demonstrates that simple exchange produces power-law wealth in the absence of value or meaning. 2. Wealth IRL is considerably in excess of this power-law behavior, to the point where it's a real impediment, because… 3. Wealth IRL owes more to capital protecting itself and rewriting the market's or government's ru…

It seems that you can simplify what you're saying to "wealth IRL is acquired mostly by crime, manipulation, or abuse, rather than skill".

The simulation doesn't seem to add to your point. Instead, you're making an empirical, falsifiable claim about the nature of wealth acquisition.

At this point, you're disagreeing less with me and more with the economists in the original article, Piketty and Saez, who found skill to be the top driver, not "next to nothing."

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#185

Post by AnimalMuppet »

hannasanarion wrote: post #170
AnimalMuppet wrote: post #121

Earlier quoted context omitted.

What is your alternative? That when a founder retires, should they be stripped of all ownership of the company they founded, because they are no longer working? Or should the owners of a company receive zero of the profits of the company? Either of those will have rather large consequences, at least some of them rather negative. So... what's your plan?

How about we start with: the people who actually work in the company get the profits. Corporations are supposed to exist to fill a public need and employ people, not to make their owners richer than kings.

That has consequences, namely, that nobody invests in the company. Because why would they, if they aren't going to make money by doing so? But that means that the company can't get outside money to buy tools that will improve productivity.

That is, your approach, writ large, harms the economy as a whole. Don't think of that just as money. Think of it as stuff being produced. If there's less stuff produced, that's not good for the workers either.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#186

Post by hannasanarion »

AnimalMuppet wrote: post #185
hannasanarion wrote: post #170

Earlier quoted context omitted.

How about we start with: the people who actually work in the company get the profits. Corporations are supposed to exist to fill a public need and employ people, not to make their owners richer than kings.

That has consequences, namely, that nobody invests in the company. Because why would they, if they aren't going to make money by doing so? But that means that the company can't get outside money to buy tools that will improve productivity. That is, your approach, writ large, harms the economy as a whole. Don't think of that just as money. Think of it as stuff being produced. If there's less stuff produced, that's not…

It harms the individuals who currently control the economy. It does not harm the economy as a whole. In fact, it greatly benefits most people, since, as workers, they get a fairer share of their work product and control over their own workplaces, and as consumers, the corporations that they rely on are no longer incentivized to fuck them over to make a quick buck. I think that's worth the cost to the bankers and barons.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#187

Post by AnimalMuppet »

hannasanarion wrote: post #186
AnimalMuppet wrote: post #185

Earlier quoted context omitted.

That has consequences, namely, that nobody invests in the company. Because why would they, if they aren't going to make money by doing so? But that means that the company can't get outside money to buy tools that will improve productivity. That is, your approach, writ large, harms the economy as a whole. Don't think of that just as money. Think of it as stuff being produced. If there's less stuff produced, that's not…

It harms the individuals who currently control the economy. It does not harm the economy as a whole. In fact, it greatly benefits most people, since, as workers, they get a fairer share of their work product and control over their own workplaces, and as consumers, the corporations that they rely on are no longer incentivized to fuck them over to make a quick buck. I think that's worth the cost to the bankers and baro…

How does "produce less stuff" not harm the economy as a whole? What is the economy as a whole, if not the sum of the stuff that's produced?

You seem to have completely ignored the point of the comment you replied to, which is: If the investor doesn't get part of the profits of the company, then nobody will invest in a company. Any company that needs outside investment to buy tools to increase efficiency therefore will not be able to do so. That loss of efficiency impacts the economy as a whole, not just the "bankers and barons".

Is there any step of that logic which you can actually refute?

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#188

Post by hannasanarion »

AnimalMuppet wrote: post #187
hannasanarion wrote: post #186

Earlier quoted context omitted.

It harms the individuals who currently control the economy. It does not harm the economy as a whole. In fact, it greatly benefits most people, since, as workers, they get a fairer share of their work product and control over their own workplaces, and as consumers, the corporations that they rely on are no longer incentivized to fuck them over to make a quick buck. I think that's worth the cost to the bankers and baro…

How does "produce less stuff" not harm the economy as a whole? What is the economy as a whole, if not the sum of the stuff that's produced? You seem to have completely ignored the point of the comment you replied to, which is: If the investor doesn't get part of the profits of the company, then nobody will invest in a company. Any company that needs outside investment to buy tools to increase efficiency therefore wil…

Why do companies need outside investment? You present this as if it is self-evident.

The reason companies need investors today is that all of the wealth is hoarded by a select few that need to be entreated like feudal lords to get any land, machinery, IP, tools, etc. If the wealth were fairly distributed, a group of regular people would be enough to pool the necessary resources.

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#189

Post by hannasanarion »

xwdv wrote: post #180
hannasanarion wrote: post #171

Earlier quoted context omitted.

Please explain to me how having money means that you should be entitled to other people's money.

Right after you explain why it’s fair for an investor to take on all the risk and get no reward.

What "risk" did bill gates take when he retired with a 40 billion dollar fortune?

Re: Never mind the 1 percent Let's talk about the 0.01 percent (2017)

#190

Post by AnimalMuppet »

hannasanarion wrote: post #188
AnimalMuppet wrote: post #187

Earlier quoted context omitted.

How does "produce less stuff" not harm the economy as a whole? What is the economy as a whole, if not the sum of the stuff that's produced? You seem to have completely ignored the point of the comment you replied to, which is: If the investor doesn't get part of the profits of the company, then nobody will invest in a company. Any company that needs outside investment to buy tools to increase efficiency therefore wil…

Why do companies need outside investment? You present this as if it is self-evident. The reason companies need investors today is that all of the wealth is hoarded by a select few that need to be entreated like feudal lords to get any land, machinery, IP, tools, etc. If the wealth were fairly distributed, a group of regular people would be enough to pool the necessary resources.

> Why do companies need outside investment?

They don't always need it. Microsoft, for instance, didn't need much in the way of investment to start and grow.

But some companies take more investment. Say it's the 1800s, and you want to build a railroad. You have to acquire a bunch of land, buy and lay rails, and buy engines and railroad cars - all before your first dollar of revenue. Where are you going to get that kind of money? You sell stock, so that anybody who has a few dollars can buy a small piece of the railroad. And why should they do so? Because they're going to get paid back, out of the profits the railroad earns (if it actually makes money).

If those people don't have the chance of getting paid back from the profits, most of them won't buy stock. If they don't buy stock, then we wind up not having any railroads. That wouldn't have been good for the economy in the 1800s.

Now, you could argue that investors could get paid back some of the profits for a limited amount, and then no further, and they would still invest. That's true, and it's the bond market rather than the stock market. But big new capital-intensive businesses typically financed themselves by stocks rather than bonds. There may be cultural reasons for that, but I think there are also solid financial reasons. Many new businesses fail. If I'm going to invest money, and there's a realistic chance that I'm going to lose all of my investment, then I need a reward that's enough to motivate me to take the risk. Bonds typically don't yield enough to compensate for that kind of risk - not even junk bonds.

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