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America's 1% Has Taken $50T From the Bottom 90%

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Re: America's 1% Has Taken $50T From the Bottom 90%

#61

Post by md_ »

Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

Your intuition here is basically what's formalized by Piketty in "Capital in the 21st Century": that the rate of growth of capital exceeds the rate of economic growth.

What's interesting is that while intuitively this makes sense (for the reasons you gave), the implication (that the rich get richer and inequality grows) is the opposite of what was hypothized by Kuznets (https://en.wikipedia.org/wiki/Kuznets_curve); the latter hypothesis, to my limited understanding (as a non-economist), is fairly mainstream, and has influenced plenty of politics and public policy.

Re: America's 1% Has Taken $50T From the Bottom 90%

#62

Post by iso1631 »

Arc_Angel wrote: post #20
h3rsko wrote: post #2

Inequality seems to be a completely pointless buzzword to me. The only thing that matters is if there are more or less poor people, and how poor are those people compared to similar percentiles in the past. It shouldn't matter how rich the richest people on earth are. I really love seeing people on the Internet try to convince themselves that because Bezos or Musk are worth $100B, they must be stealing it from poor p…

"It shouldn't matter how rich the richest people on earth are." It does. Bezos and Musk can influence Policy. They can influence for their own ends. Also, it depends on HOW they make their money too. Do they create things? or do they buy up everything such as Real Estate and then jack up the price. There's different kinds of "Capitalism". Rent-seeking is the worst kind. Producing goods that people can use is much bet…

Do Bezos and Musk have significant investments outside of Amazon/Muskinc?

If Amazon suddenly was nationalised with no compensation for shareholders, what would Bezos' assets be? I'm sure he wouldn't be destitute, but it's not like someone who's become wealthy by shuffling money around (like wall street billionaires).

Re: America's 1% Has Taken $50T From the Bottom 90%

#63

Post by RIMR »

Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

Sounds like a great system for everyone with generational wealth, and a terrible system for literally everyone else.

Re: America's 1% Has Taken $50T From the Bottom 90%

#64

Post by koboll »

_qulr wrote: post #43
Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

> This is almost a natural law of wealth. The article is about how the post-1975 period differs from the pre-1975 period. So it's demonstrably not a natural law. Natural laws don't change over time.

From 1960 to 1985 the top marginal tax rate crashed from 90% to 30%. And then of course there's the demise of private sector unions, the effects of computerization, etc.

Arguably, it was always a natural law, but the 1970s were an inflection point after which capital was allowed to accrue advantages at a much faster rate.

Re: America's 1% Has Taken $50T From the Bottom 90%

#65

Post by toiletfuneral »

h3rsko wrote: post #2

Inequality seems to be a completely pointless buzzword to me. The only thing that matters is if there are more or less poor people, and how poor are those people compared to similar percentiles in the past. It shouldn't matter how rich the richest people on earth are. I really love seeing people on the Internet try to convince themselves that because Bezos or Musk are worth $100B, they must be stealing it from poor p…

They’re literally stealing their employees surplus labor.

Re: America's 1% Has Taken $50T From the Bottom 90%

#66

Post by 0xfaded »

adolph wrote: post #42

How is this different from any random conspiracy theory? The term "counterfactual" is used instead of "I made a strawman?" Edit: the reliance on "taxable income" instead of gross is interesting. Wouldn't a progressive tax policy look similar to the paper's stats since more income would be taxable for folks with lower income? https://www.rand.org/pubs/working_papers/WRA516-1.html

https://wtfhappenedin1971.com/

This is a huge collection of charted data which shows that there may indeed be something going on that is a little harder to explain away than the average conspiracy theory.

The study of how wealth accumulates to capital holders has been reinvigorated by Thomas Piketty's "Capital in the Twenty-First Century".

Since then, a huge amount of research has been done on the driving forces behind wealth inequality. Skimming the surface, I'll throw out https://angrynomics.com/ and https://www.amazon.co.uk/Rentier-Capitalism-Owns-Economy-Pay....

Re: America's 1% Has Taken $50T From the Bottom 90%

#68

Post by silexia »

natenthe wrote: post #57

Correction: The Fed's policies have taken $50T of wealth from the Bottom 90%. When you bail out irresponsibly over-leveraged and nearly bankrupted banks and corporations, and pay for those bailouts with tax-payer money, you steal from the poor and give to the rich. Most importantly, when the Fed decides to print money ad nauseam, they create massive asset inflation, which steals from the poor and gives to the rich. T…

The bailouts are tragic as it undermines the natural garbage collection in democracy - bankruptcy. Bankruptcy is an incredible positive because it allows for the safe and sane dismantling of bad organizations.

The question is - how do we apply a mechanism like bankruptcy to government organizations?

Re: America's 1% Has Taken $50T From the Bottom 90%

#69

Post by hungryhobo »

Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

sure, but i think the focus is on the magnitude and speed at which the wealth gap is widening. And its impact might be something we haven't encountered before

Re: America's 1% Has Taken $50T From the Bottom 90%

#70

Post by Pfhreak »

_qulr wrote: post #43
Pfhreak wrote: post #23

This is almost a natural law of wealth. When you have significant capital, you can do things like loan it out with interest, leverage it into getting loans to build more capital, etc. If one assumes that the wealthy are using their money to buy commodities and selling those commodities with the expectation of getting their initial money back plus some delta, then it becomes fairly trivial to demonstrate that the more…

> This is almost a natural law of wealth. The article is about how the post-1975 period differs from the pre-1975 period. So it's demonstrably not a natural law. Natural laws don't change over time.

The law might be the same, but the environment can change around the law. From tax rates and economic conditions to the power of labor can all shift how we respond to that natural law.

Wealth can continue to generate wealth, which we can then tax and redistribute. The natural law hasn't changed, but how we work around it has.

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