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Just Be Rich

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Re: Just Be Rich

#181

Post by mordae »

TheTrotters wrote: post #123
ac29 wrote: post #100

Earlier quoted context omitted.

World population crossed 4B in the 1970s and 5B in the 1980s, now we are about to cross 8B in the next few years. I agree with your point about real estate becoming more heavily securitized, as well as being used as a method to escape capital controls. But, you cant ignore the fact that there are a lot more people both rich and working class competing for those major world city houses than there were 40 or 50 years a…

The obvious solution is to build more housing. We know how to do that! The obstacle is politics, not technology or economics.

Not really.

Some countries have wealth tax. Some countries don't.

It's sensible to park your money somewhere, where it's not taxed.

If you build more of it, yes, you will meet some of the housing demand (basically just for the richest), but housing is competing with rich people saving.

You need to tax unproductive behavior to rid of it.

Re: Just Be Rich

#182

Post by emmanueloga_ »

d_silin wrote: post #7

A lot of people who are just as smart and motived as Elon Musk or Steve Jobs will never be able to start their own companies and get rich. Because they have family obligations that take priority. Because they live outside high-income countries. Because they have no access to support network, so when they fail, they fall all the way to bottom. Because they may have made a crippling mistake in their pasts that now prev…

Agreed. It is not only about discrete circumstances ... environment also nurtures and affects development of people over time. Being exposed to better odds over time is also a factor (ppl that were able to create good networks in their youth vs ppl that somehow "made it" later in life...).

Re: Just Be Rich

#183

Post by sbacic »

Barrin92 wrote: post #49

I'm just gonna quote what I think is a very important part from the Graham piece itself >" People who don't look any deeper than the Gini coefficient look back on the world of 1982 as the good old days, because those who got rich then didn't get as rich. But if you dig into how they got rich, the old days don't look so good. In 1982, 84% of the richest 100 people got rich by inheritance, extracting natural resources,…

> Because at least old money understands the concept of noblesse oblige.

Source please.

> it's that this mentality of earned wealth completely rids the owner of any sort of responsibility.

Allow me to offer a different view. If you're one of the lucky few who went from nothing to millions (or even billions) you'd be pissed if society came and started talking about responsibility and equality _now_. Where was society _before_?

And that, I think, is the crux of the issue - society feels responsible for your successes but not for your failures. If you went from nothing to riches - society feels like you owe it some. But if you went from squarely middle class to being a drug addict on the streets then the fault is yours alone. Society will of course try to help you, but it will never consider the idea that maybe, just maybe, it is responsible for what happened to you.

Re: Just Be Rich

#184

Post by kortilla »

ludocode wrote: post #109
solveit wrote: post #94

Earlier quoted context omitted.

Increasing income inequality does not necessarily imply that. In fact, the US poverty rate has been more or less stable for the past 50 years[1]. And the worldwide poverty rate is dropping like a stone. [1] To be clear, I very much view this as a failure given how much richer the US has become in the same period. Nevertheless, it is not true (or at least not clear) that the portion of people who are able to actualize…

This statistic is misleading. The U.S. government defines the poverty line based on a 1955 model of spending patterns. It's completely inadequate for modern needs. The poverty line for a family of four is defined as a household income of $26,200. Any reasonable person knows it's impossible to pay rent and feed and clothe two adults and two kids on less than $2200 a month. Nevermind owning a home, having a car, saving…

> Any reasonable person knows it's impossible to pay rent and feed and clothe two adults and two kids on less than $2200 a month.

Step outside of your bubble. This is very feasible in low CoL areas all over the US. And remember that’s the line so it’s going to be difficult, but it can be done.

Re: Just Be Rich

#185

Post by SequoiaHope »

“You would think, after having been on the side of labor in its fight with capital for almost two centuries, that the far left would be happy that labor has finally prevailed.”

This is listed as a quote from the PG essay. It seems to represent a fundamental misunderstanding of what “labor” means here. When the left fights for “labor” it is for all laborers to get a fair shake. PG seems to be talking about the fact that a tiny fraction of laborers get wealthy for their work. But that is not at all what the left fights for.

It’s amazing that rich people convince themselves they are so right about the world and they don’t even understand the critique of their position. For PG to say that the left should be happy with a tiny few getting super rich is to demonstrate a complete lack of understanding of what “the left” even means.

I’ve long wondered if even a single billionaire on Earth actually understands even the basics of Marxism from a Marxist perspective and I bet the percentage is very small.

Re: Just Be Rich

#186

Post by gameman144 »

mnsc wrote: post #130
saddlerustle wrote: post #103

Earlier quoted context omitted.

Pretty much every mainstream economist put the blame for this squarely on the massively increased regulation of the housing market since the 70s causing a massive decrease in the amount of new construction, not wealth itself.

Pretty much every mainstream economist defending the mainstream economy to preserve the status quo in that widening the income gap is a good thing for the mainstream economy you mean?

There are actually loads of mainstream economists today who recognize and are looking to address the wealth gap. Most of the pushback I've read about has been objections that specific policies proposed to solve it have side-effects that create a whole new slew of problems.

Re: Just Be Rich

#187

Post by inglor_cz »

dmitriid wrote: post #175
inglor_cz wrote: post #132

Earlier quoted context omitted.

Are you sure? From what I see around me, people who have money are a constant target of other people who want to drop their beaks into it, so to say. Starting with distant relatives that got into trouble and suddenly found a familial love for them, continuing with various false friends, gold diggers of both sexes and people hustling investment opportunities. Ending with lawyers and doctors who might induce you to und…

To add to what the sibling comment already said: - If you don't have to work two jobs to survive, you have the time to pursue other things, and you're more "lucky". - If you have the ability to not work and can spend a year/two/five working out of a "garage", you're more "lucky" than those who can't. - If you have the ability to send your kids to an expensive college without you or them going into life-long debt, the…

This is quite a huge spectrum of "rich" and "lucky". From absolutely basic things to expensive college.

I cannot afford a vacation in Macchu Picchu, but it does not detract from my feeling of being lucky/unlucky. Local vacations in Europe or even in my own country are fine. If anything, Covid era was a good teacher in what really matters.

And the college and networking is begging the question (IDK if I use the expression correctly). I do not doubt that Harvard graduates have it easier in general, but they are probably less prepared for a possible black swan event after which their degree won't have the weight it currently has. Shelling out enormous money for getting connections is a conformist (expensive and lazy) way of building career. I do not find much luck in that.

Re: Just Be Rich

#188

Post by goatinaboat »

lordnacho wrote: post #154
d_silin wrote: post #7

A lot of people who are just as smart and motived as Elon Musk or Steve Jobs will never be able to start their own companies and get rich. Because they have family obligations that take priority. Because they live outside high-income countries. Because they have no access to support network, so when they fail, they fall all the way to bottom. Because they may have made a crippling mistake in their pasts that now prev…

The thing that I'd expand upon is the support network. Somehow I have a wider range of friends and family than most people, and the thing that is missing from this conversation is that most people by far don't know anyone wealthy, especially if they're not themselves wealthy. The issue with that isn't just the money and connections themselves. There's a cultural gap of "I couldn't do that, only people on TV do that"…

I have a cluster of cousins in the bay area, what do they do? None of them do startups. Doctors, nurses, and Google.

I wouldn't describe this as risk-averse behaviour. The simple fact is in the modern startup ecosystem, even if the startup has a successful exit, even early stage engineers will see very little wealth having been massively diluted, and would have been much, much better off having worked for an established company over the same time period. An early stage employee takes all the risk but all the reward goes to the founders and the VCs. It's not worth it.

Re: Just Be Rich

#189

Post by lend000 »

XorNot wrote: post #145
lend000 wrote: post #42

Earlier quoted context omitted.

Why go straight to a wealth tax? In the US, there exists a comprehensive system for measuring economic activity and translating it to income. To measure wealth would require a huge invasion of privacy (not only of the wealthy but the 'suspected wealthy') and a whole new system of identifying and tracking things of value. Why not fix the income tax? At least try fixing it using the existing system, before creating thi…

Because it's more nuanced then that: the point of the uber-wealthy is that their net worth is tied up in investments. But because those investments have theoretically actualizable values, they can still "spend" them in the form of taking out loans against their assessed value. Which then compounds because a loan devalues with inflation, the bigger the loan the lower your interest rate and so on and so forth. So it wi…

You're proposing unnecessary complexity to solve a phantom problem. The wealthiest person in the world just sells a few billion worth of stock each year to fund his lifestyle/other companies. He pays the rate for the top capital gains bracket. It isn't that complicated. More brackets would normalize the wealth distribution.

Some of the wealthy do take out loans against assets, but these loans involve risk. Investments are not guaranteed to beat an interest rate, or banks would just buy the investment, instead of loaning out the money at the interest rate. Especially for the ultra wealthy, those assets are typically heavy in one or two companies (the companies they founded, for example). And even if they can beat the interest rate on average, they still are continually liquidating the asset over the course of the loan, incurring the income tax. They certainly aren't beating the income tax rate + interest rate, if you fix the brackets.

Nowadays, the Fed has almost taken an assured position that it will print enough money to rescue the market no matter what happens/melt your cash, but that's a separate issue. Address the inflationary monetary policy; don't create a huge wealth tax band-aid when a simpler solution exists.

Re: Just Be Rich

#190

Post by sellyme »

kortilla wrote: post #177
d_silin wrote: post #70

Earlier quoted context omitted.

In the US at least, it is definitely decreasing. Income inequality is growing, as the original essay noted.

Income equality tells you nothing about the conditions of the middle or lower class. An economy in which all classes grow income and wealth can still increase inequality if it allows more people than before to become rich.

> Income equality tells you nothing about the conditions of the middle or lower class.

There's a graph in TFA showing that, after adjusting for inflation, the per-individual wealth of the middle and lower classes decreased by 20% and 45% respectively between 2001 and 2016. The individual wealth of the upper class increased by 33% in this time period.

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