Is Inequality Inevitable? • Hacker News Board

Re: Is Inequality Inevitable?

#201

Post by HammockWarrior » Wed, Nov 06, 2019, 9:55 PM UTC

robomartin wrote: post #179

HammockWarrior wrote: post #89

Earlier quoted context omitted.

I think most people promoting redistribution would agree on the benefits of equality of opportunity over outcome (obviously not all). They would simply argue that equality of opportunity is not there yet and the Gini coefficient can perhaps be used to measure that. For example if the Nordic countries operate well and have better equality of opportunity in the 30s as opposed to the US's 40s and we have seen in the pas…

Sure, but you have to consider that the often-touted Nordic countries have a very different demographic composition than the US. Easy example: Estimates place the illegal immigrant population of the US somewhere in the 25 million range (as a conservative estimate). Assuming half of them are of working age, that is, in rough terms, over 10% of the portion of the US population that is working (about 108 million). The v…

Illegal immigration and what happens in other countries are at best a red herring here because illegal immigrants aren't typically eligible for benefits and are typically working off the books. The US government has responsibility for its citizens, not those of Mexico or Latin America.

Also keep in mind many of the proposed redistribution efforts fall squarely in the "equality of opportunity" column which you claim to support. For example, free or very cheap higher education. If we want to be as educated as the Nordic countries this would go a long way. Or taxpayer funded healthcare. This would both reduce the total cost of healthcare and also greatly improve access. It's hard to pull yourself up by your bootstraps when you're sick and can't afford to see a doctor.

Perhaps let me turn this conversation around. Rather than throwing up your hands and saying "it's complex", what specific policies would you support to improve equality of opportunity?

Re: Is Inequality Inevitable?

#202

Post by chii » Wed, Nov 06, 2019, 9:57 PM UTC

AnimalMuppet wrote: post #165

NovemberWhiskey wrote: post #136

My perspective on this might be too naive; but it seems wealth inequality (which is the topic of this article) is inevitable since a significant proportion of the population will spend their entire income and therefore never save. It seems like about 19% of all Americans have zero net worth, and something like 44% of single American retirees are dependent on Social Security for 90% or more of their income, implying t…

Hmm. If they depend on Social Security for 90% of their income, should Social Security be included in their savings? It's not conventional savings, and yet it's funding their retirement. In the same way, should pensions be counted as part of savings? And if you run the calculations that way, what does it do to the distribution of wealth? Note well: I am not saying that this is the right way to run the calculations. B…

but social security is funded via taxation, so it's somebody else's savings that's being forcibly taken away. Counting it as savings would give the wrong picture.

Re: Is Inequality Inevitable?

#203

Post by turc1656 » Wed, Nov 06, 2019, 9:58 PM UTC

ryeguy_24 wrote: post #150

> "388 individuals possessed as much household wealth as the lower half of the world's population combined" My goodness! This completely shocked me. I wonder if we are all complicit in allowing this to happen. I know wealth buys power and vice versa, so it likely would be hard to change but aren't we all indirectly allowing this to happen?

It's even more shocking than you may have realized. Not sure if you caught it because you may have been too surprised or just read quickly, but that was the 2010 number. The current number is estimated to be a mere 26 people that hold as much as the lower half!

Re: Is Inequality Inevitable?

#204

Post by __max__ » Wed, Nov 06, 2019, 9:59 PM UTC

notahacker wrote: post #176

Empact wrote: post #144

It should be self-evident that the accelerating inequality we’re witnessing is not the natural inequality of competition and the power law, easily explained by simple arithmetic. An accelerating and historically high broad societal effect is naturally a product of broad and unique properties of the current regime, rather than fundamentally consistent properties, which would naturally be seen across all time. What is…

A _lot_ of US public policy changes and economic structural changes which favour the rich have happened since 1971. The problem with trying to pin everything on inflation is that inflation has been more stable and lower in recent years than much of the Bretton Woods era...

> inflation has been more stable and lower in recent years than much of the Bretton Woods era...

That depends how you measure inflation. The government-published inflation rates use all kinds of creative accounting to make the number seem artificially low. It's in the government's interest to make it seem like that's the case. The reality is that housing prices (and rents) are increasing at a very high rate, and this is probably the biggest expense that we all have to pay. It's also a fundamental need.

Re: Is Inequality Inevitable?

#205

Post by nostrademons » Wed, Nov 06, 2019, 10:01 PM UTC

gnopgnip wrote: post #198

nostrademons wrote: post #125

Earlier quoted context omitted.

> Inequality does not mean we need to have people who can't satisfy their most basic things. It is possible for people to be allowed to compete for wealth and at the same time ensure those that don't want or can't compete have their basic needs like food, shelter and medical care satisfied. How? I get that there's a lot of waste and inefficiency in those industries. Whenever zoning laws prevent a developer from build…

Progressive taxes, a safety net of social services.

You're not answering the "How?" Who is providing the services? How are they trained? How do new people enter the field? What incentive do they have to provide a good job? What do you do if they do a shitty job?

Throwing money at problems usually means that the people providing the solutions make more money. It does not necessarily mean that the problems get fixed. In many cases, it means that those people now have more resources to ensure that the problem does not get fixed, so that the government will keep throwing money at them to mitigate it.

Re: Is Inequality Inevitable?

#206

Post by turc1656 » Wed, Nov 06, 2019, 10:01 PM UTC

colechristensen wrote: post #96

tunesmith wrote: post #10

Have there been any efforts to quantify what level of inequality is reasonable? For instance, the GINI coefficient ranges between 0 and 1, where 0 means everyone has the same amount, and 1 means one person at the top has everything. Depending on how it's measured, the US is somewhere between 0.4 and 0.5. You don't want to be at either extreme, so some level of inequality is desirable. Is there an appropriate amount o…

Does anybody do a sort of power law fit for wealth distribution? i.e. (yearly income | total assets | net worth | passive income) vs. population percentile? I can't seem to quickly find raw data to make an example.

Not sure if this answers your question, but I heard someone talking about inequality following Price's law, which is also what all sorts of creative and scalable endeavors seem to follow.

Re: Is Inequality Inevitable?

#207

Post by jgalt212 » Wed, Nov 06, 2019, 10:04 PM UTC

zeroxfe wrote: post #28

jgalt212 wrote: post #12

Earlier quoted context omitted.

for sure, but you're missing the tax avoidance bit. Without tax avoidance, compound interest does nothing at most reasonable levels of r and t.

I don't follow your logic. Compound interest grows capital exponentially, while taxation is linear. So, while tax avoidance helps, it's not necessary.

1.10^50 is 10X 1.05^50

taxes do a lot to flatten the distribution.

Re: Is Inequality Inevitable?

#208

Post by amelius » Wed, Nov 06, 2019, 10:06 PM UTC

lmilcin wrote: post #115

ska wrote: post #100

Earlier quoted context omitted.

Isn't it also important to note that wealth acquisition activities and wealth creation activities are not the same thing?

This is excellent point. If it is too easy to gather wealth so you can gather wealth without actually having to create any value (through corruption, extortion, monopoly, theft, deception, enslavement, etc.) then you will have the bad kind of inequality where most people are not compelled to put hard work to create value for others in order to create wealth for themselves. Again, GINI does not differentiate between t…

> (through corruption, extortion, monopoly, theft, deception, enslavement, etc.)

rent-seeking should be there too

Re: Is Inequality Inevitable?

#209

Post by colechristensen » Wed, Nov 06, 2019, 10:07 PM UTC

turc1656 wrote: post #206

colechristensen wrote: post #96

Earlier quoted context omitted.

Does anybody do a sort of power law fit for wealth distribution? i.e. (yearly income | total assets | net worth | passive income) vs. population percentile? I can't seem to quickly find raw data to make an example.

Not sure if this answers your question, but I heard someone talking about inequality following Price's law, which is also what all sorts of creative and scalable endeavors seem to follow.

What I'm driving at is measuring inequality by a power-law kind of model comparing with the value of the exponent.

Re: Is Inequality Inevitable?

#210

Post by wang_li » Wed, Nov 06, 2019, 10:07 PM UTC

fzeroracer wrote: post #164

wang_li wrote: post #157

Earlier quoted context omitted.

>Most of the poor have no wealth in the first place. Plenty of the poor actively destroy value, see the sanitation nightmares that are homeless encampments in the Seattle area. And the rest of the poor don't produce life sustaining value. Wealth transfers in the US are exclusively from the middle class and wealthy to the poor. To say otherwise is simple demagoguery.

This is nonsense and ignores that the rich and wealthy can actively destroy value on a far more massive scale. The damage fracking has done to the environment for example is far more than any homeless encampment and that's just one example. Most of the wealth from the poor is stolen through increasing rent seeking behaviors from landlords, insurance companies and lobbying. I could speak at length the ways banks organ…

>Most of the wealth from the poor is stolen through increasing rent seeking behaviors from landlords, insurance companies and lobbying. I could speak at length the ways banks organized things as to punish the poor by organizing deposits to occur after transactions so that they can charge overdraft fees or insurance companies deciding not to cover you because of pre-existing conditions.

You could go on at length about that stuff, but you'd mostly be wrong. Don't write checks unless the money is in the account to cover the check. Pre-existing conditions don't work like that.

Ultimately, if it costs $18000/year for a person to live and they only earn $15000/year then they are short $3000 and that money comes from the middle class and wealthy. When you factor in all government services and transfers this is what happens to over 60% of the country. It is objective reality that the lifestyles of the bottom 60% are subsidized by the top 40% of tax payers.

https://www.cbo.gov/sites/default/files/114th-congress-2015-...