Economists Are Rethinking the Numbers on Inequality • Hacker News Board

Re: Economists Are Rethinking the Numbers on Inequality

#311

Post by harryh » Thu, Dec 05, 2019, 2:07 AM UTC

ars wrote: post #299

harryh wrote: post #162

Earlier quoted context omitted.

Property taxes are not wealth taxes, they are consumption taxes. You can easily tell this because a person who owns a home outright pays the same tax as someone who owns a similar home but has a large mortgage. These two people have different levels of wealth but pay the same tax. This is because their consumption is the same.

Property taxes are neither wealth or consumption taxes. Those are not the only two options. You could just as easily charge the mortgage holder the property tax, and that mortgage holder will then charge the that amount as an extra fee on the mortgage. What does that do to your argument? Seem to me Property tax is basically a toll. Just like you pay a toll to use a road, you pay a toll to use a house.

What does that do to your argument?

It does nothing to my argument. Because the tax incidence would all still be on the consumer of the property.

Just like with a rental property: the cost of the property tax is passed on to the renter.

Re: Economists Are Rethinking the Numbers on Inequality

#312

Post by beerandt » Thu, Dec 05, 2019, 2:14 AM UTC

chipotle_coyote wrote: post #219

kofejnik wrote: post #94

Earlier quoted context omitted.

yes, exactly; to have equality, you'll have to reduce everyone to the lower common denominator, which will be rather low Also, I don't see why exactly inequality is inherently bad. I'm poorer than Bezos, _and that is a good thing_. Pretty much like Steph Curry is better than me at basketball and so he should have a lot more ball possesion should we be playing on the same team, Bezos is much better than me in allocati…

It's a bit of a strawman to take arguments of the general form "we should enact policies to reduce inequality" and implicitly restate them as "we should enact policies that force perfect equality," then argue against that restatement, don't you think?

I think the concept of "inequality" itself is a type of straw man. It's basically a problem that will perputually exist. Arguments (straw man or not) pointing out the lack of a concrete, absolute (non-relative), morally justified goal is appropriate as long as "inequality" itself is the stated "problem."

If we were talking about a fixed, concrete goal, then I'd agree with you. Reducing poverty, reducing world hunger, increasing standards of living, etc are things that can be accomplished by setting some absolute, concrete moral goals, which moving towards by any measure might be considered morally good. But "inequality" on its own is, prima facia, a term that requires comparison to the point of "perfect equality".

Doing good things might result in less inequality, but reducing inequality for the sake of itself is just justification of envy. There's nothing inherently "evil" or even negative about it.

On a side note: "Reducing inequality" is an activists dream. They can sell political solutions forever for a problem that will always exist, by some form of the definition.

(Unless we were to oversimplify it and set some standard deviation type hard-target for income distribution, but I've not heard anyone suggest this, let alone an appropriate "fair" target distribution. I'm not for it, but it's at least a measurable goal.)

Re: Economists Are Rethinking the Numbers on Inequality

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Post by agensaequivocum » Thu, Dec 05, 2019, 2:14 AM UTC

leto_ii wrote: post #133

bhupy wrote: post #116

Earlier quoted context omitted.

> Well, in the US, as possibly in other places, elections are usually won by the candidate who receives the most corporate support Again, this is orthogonal to the point about inequality. Insofar as corporations or money are involved in politics in America, it's for campaigning — buying TV ads, flyers, etc. While it's true that this makes it easier for richer people to get their message out there, the fact of the mat…

In a society there are may levers (official or not, transparent or not) that the powerful can pull to get politics to lean their preferred way. This is true of all places and all times. The more power is concentrated, the easier it is for a very small group of individuals to have a very large impact on decision making. All the billions poured in campaign funding, lobbying etc. do actually buy a lot of influence albei…

>The more power is concentrated, the easier it is for a very small group of individuals to have a very large impact on decision making.

So if we remove the federal government's broad involvement in all aspects of life, we can reduce the power of corporations by reducing their vehicle of control. I agree.

Re: Economists Are Rethinking the Numbers on Inequality

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Post by ledauphin » Thu, Dec 05, 2019, 2:23 AM UTC

maxsilver wrote: post #82

xorfish wrote: post #66

Earlier quoted context omitted.

But hoarding wealth isn't a problem for inequality. It is that capital can be used to generate income. Inflation is the process that incentivizes capital to be put to work.

> But hoarding wealth isn't a problem for inequality. It absolutely can be, especially for wealth that is finite. (Like land for housing) > Inflation is the process that incentivizes capital to be put to work. Does it though? Inflation mostly just punishes labor alone, labor feels the effects of inflation far more severely than anyone else. With enough capital (the amount anyone 'hoarding wealth' already has), the ca…

I'm not an expert, but what you describe as "capital sitting doing nothing" is, presumably, capital invested in some kind of market index? In which case it's by definition not "sitting doing nothing", right?

Unless you were referring to capital in the sense of owned non-market property that appreciates with time? Land/property values are a major topic of discussion throughout this thread for sure.

Just trying to make sure I'm following the thread of the argument here.

Re: Economists Are Rethinking the Numbers on Inequality

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Post by marcusverus » Thu, Dec 05, 2019, 2:26 AM UTC

matchbok wrote: post #284

corporate_shi11 wrote: post #247

Earlier quoted context omitted.

The problem with education in America is not government and policy, but individuals, families and culture. Many school districts across the country have horrid graduation rates and median test scores. The amount of money you pour into these districts has very little impact on student outcomes. How different would wage growth and average wages look like if the people in these districts took school seriously? The numbe…

It's hard to take school seriously if you have to work 3 jobs to provide for your child.

This old canard!

Only 0.4% of Americans in the workforce have three jobs.

https://www.census.gov/library/stories/2019/06/about-thirtee...

Re: Economists Are Rethinking the Numbers on Inequality

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Post by s1k3b8 » Thu, Dec 05, 2019, 2:34 AM UTC

leto_ii wrote: post #13

A lot of this article reminded me of the techniques used by climate change deniers to sow doubt. Take for example the following: > Another correction concerns the tax reforms passed under Ronald Reagan in 1986. Apparent changes in top incomes around this reform account for about two-fifths of the total increase between 1962 and 2015 in the pre-tax incomes of the top 1% in Messrs Piketty and Saez’s estimates. Messrs A…

> A lot of this article reminded me of the techniques used by climate change deniers to sow doubt.

And a lot of climate change advocates' technique reminds me of the religious zealots of the past. Even down to the ad hominems like "Christ denier"/"climate change denier".

Firstly, I don't believe climate change is a matter of "belief". No such thing as a "climate change denier". Climate change is an intrinsic part of nature. It always exists.

> Doesn't it smack of "the science is not in yet" argument used by climate change deniers?

But the "science is not yet in". That's why there is so much debate, even within the "climate change" advocacy group.

If climate change was a developed science and we understood climate change adequately, we wouldn't have so many climate change models. We would have ONE.

On the one hand, climate change advocates claim that the climate is too complex that we can't have a predictive model yet. And yet, climate change advocates also claim that their own personal view is gospel and everyone else who doesn't agree are heretics.

Re: Economists Are Rethinking the Numbers on Inequality

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Post by Mirioron » Thu, Dec 05, 2019, 2:36 AM UTC

eutropia wrote: post #60

xorfish wrote: post #50

Earlier quoted context omitted.

> not on income or cap gains Why does it matter how it is taxed? If the capital returns 4% and is taxed at a 30% rate, you will have the same effect as if the capital is taxed at a rate of 1.15%. I think the biggest injustice is that return of capital isn't taxed at the same rate as income from labor. Someone who earns $100'000 from labor and $50'000 from return on capital should be taxed at the same rate as someone…

Taxing capital incentivizes putting it to work. If you only tax gains then people can endlessly horde wealth. Taxing the wealth itself makes hording unappealing... I think.

But taxing capital is not possible and probably a bad idea. This will require you to list everything you own to the government who will then evaluate the worth of it. I really can't think of much else that's a worse violation of privacy. It will also make owning something expensive a bad idea, because you'll have to pay to own it. In fact, can you even say that you own it at that point? Aren't you basically renting it from the government instead? Thinking more about it, I'm surprised that totalitarian systems didn't have a wealth tax.

Re: Economists Are Rethinking the Numbers on Inequality

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Post by marcusverus » Thu, Dec 05, 2019, 2:38 AM UTC

tsimionescu wrote: post #73

tkyjonathan wrote: post #46

I would rather focus on reducing absolute poverty than reducing inequality (gini-coefficient).

Unfortunately, you can't have a real democracy with too high income inequality, and it is hard to reduce absolute poverty if the poor don't have a political voice.

This seems disingenuous to me. If your concern is the influence of money in politics, address that issue directly. Get rid of PACs, or give a total annual cap in per-person political donations, or move to publicly funded elections, or quadruple the number of House seats so that canvasing for votes is a legitimate strategy for poor candidates.

Redistributing wealth to enhance the relative political voice of the poor is an absurdly tangential 'solution' to the stated issue.

Re: Economists Are Rethinking the Numbers on Inequality

#319

Post by airstrike » Thu, Dec 05, 2019, 2:38 AM UTC

karpierz wrote: post #296

Invictus0 wrote: post #146

Earlier quoted context omitted.

The jobs you listed are all information worker jobs. Service jobs are things like hairdresser, waiter, receptionist, etc.

The parent poster is referring to the three-sector model of the economy: primary (resource extraction, agriculture), secondary (manufacturing, processing), tertiary (services). Education, R&D, knowledge workers, secretaries all fall under this.

Thank you

Re: Economists Are Rethinking the Numbers on Inequality

#320

Post by beerandt » Thu, Dec 05, 2019, 2:38 AM UTC

throwawayjava wrote: post #178

xorfish wrote: post #137

Earlier quoted context omitted.

Most fund managers are very intelligent people, yet most of them fail to outperform a basic index fund. The Harvard endowement underperformed the sp500 by more than 3% annually for the last 10 years. So instead of a plus of 220% it produced a plus of about 130% over the same period. There is lots of data that shows that passive strategies outperform hedge fund and these university funds.

Harvard is optimizing for a different objective than retail investors or even smaller endowments. It can afford to take less risk and get less return. Lots of small colleges with 100MM endowments using a passive strategy will fail to survive the next deep recession. They need those returns to survive, so they have no choice but to accept the associated risk. But one deep down market without an associated counter cycl…

With this in mind, Harvard's recent missteps diversifying internationally (land, agriculture, etc) becomes a lot more interesting.

It'd be interesting to see how much those missteps brought down the overall ror.