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The ultra-rich are claiming an increasing share of global wealth

lemonde.fr

61–70 of 71 posts

Re: The ultra-rich are claiming an increasing share of global wealth

#61

Earlier quoted context omitted.

Why is it misleading? Debt is negative wealth. Being indebted to the very rich puts you lower than people who at least have nothing. Would it be less misleading for you if they silently ignored bottom 20% of people?

Because of the lifestyle you can live while in debt. If you're driving expensive cars and living in nice houses and eating good food because you pay for it with a credit card, sure, you're in debt, but your life is better than someone that isn't using a credit card to pay for things. Are you going hungry? is the question.

Life in debt is better for now. But it will be way worse in the future if things won't go your way and they most likely won't. There's plenty of people willing to indebt almost everybody, because it's profitable. They sell temporary life above means for future wage slavery.

The question is, do your really believe loan sharks and other lenders are saviors of the poor?

In absence of lenders the issue of poor people would need to be solved systemically. Instead the government abstains and lets poor sell themselves to the highest bidder.

When it comes to calculating wealth in the context of social justice it's absolutely correct to count debt as negative.

Re: The ultra-rich are claiming an increasing share of global wealth

#62

If you take any ancient or not so ancient civilization or kingdom, all the wealth including land and people's lives belonged to king/imperator which was appointed by god or something like that. Isn't is exactly the same with the system we have now? The question we have to ask is about 99% of population of peasants who work 8h a day same as they did in Mesopotamia. Do they have a living standard, healthcare, possibili…

I want a 4h day now.

Re: The ultra-rich are claiming an increasing share of global wealth

#63

Rich people having too much wealth is not necessarily that bad a thing because most of the investment is in productive companies. It’s not like they are using their wealth on frivolous consumption. Which means redistribution would only change who controls the investment and not the actual consumption patterns of people. Implication is that poor people will consume the same as before after redistribution with perhaps…

> it’s not so clear that redistribution is necessarily a good thing

It's unclear what you mean by "redistribution".

> I feel the people who made money are more likely to make better decisions on their own companies

The majority of publicly-listed companies aren't majority owned by their founders. They're still focused on profits and being competitive.

Instead of "redistribution" the way you imagine it (central planning), what if it was more like a sovereign wealth fund?

The government owns shares in all companies, like an index fund. It acts like a normal institutional investor. In fact I wouldn't mind contracting out the management of these holdings to a sober company like Vanguard. And dividends from these holdings are used to reduce income taxes. Stop penalizing people for working and earning more.

Re: The ultra-rich are claiming an increasing share of global wealth

#64

Earlier quoted context omitted.

And where do you think the indefinitly raising wealth of the top 10% comes from? I think you should look into modern monetary theory, MMT.

Yes I’m aware but can you describe how redistribution can work in this case? Where does the new money come from? If poor people are spending more now then someone has to spend less. Who is it?

Okok, i am explaining it all as good as i can but i wished you did the work yourself, because you are in the best spot intellectual challenge your believes, so i am giving you one last chance.

What is money and where does it come from today?

You often see talking heads, arguing about future policies and the, usually conservative guy, argues against social spending with "where the money should come from." This implies that money must be earned before you can spend it. This take is not just blatantly false, when you look at the private sector (eg. big mergers entirely financed by credit), its even more false for states that have a special/privileged role in the economic system.

Other, usually conservative, political projects barely get publicly challenged on the financial level. I am asking you again, what happens, when a giant bill, eg. for the iraq/afghan war, has to be paid, what does a state do? How does it work? Budget bills enforce what, where?

... they force a financial gov.dept. (dont know which one in the US) to just spend that money for a project, that budget bill authorizes. To do so they manage their own assets (taxpayer money) but they are also capable of taking on debt from private lenders via bonds or from banks as credits. So, by the brush of a pencil, there can be enough money to finance anything you wish for! There really is no upper bound when your country has monetary autonomy and/or has good credit rating, but where does this debt come from?

In the case of bonds, the answer is easy, private buyers spent their existing money and hand it over to you. The case for banks is much more interesting and systemicly relevant, because banks also have a privileged position.

Private banks have the ability to *create* debt/money from nothing (so does the central bank), since there is no backing of gold anymore. Private banks are required by law to hold maybe 10% of their credit activas as own capital reserve, but once their credit is out there it might become another banks asset, that now can lend out 9x of that value again. You can repeat that process indefinitely to get an infinite money supply.

This is the current world we live in. Money is debt, created by privileged institutions, handed out to privileged lenders. (And on all of it ticks interest!) When ever i hear someone like you, bringing the "government printing press" argument, i cringe internally, because private banks have the same ecomically vital ability and with the exception of banking/market laws and profitability, totally unchecked.

The scarcity of money only applies to the unprivileged/poor. And only corrupt or clueless politicans consider their countries finances as the finances of a regular low-income household. The ever increasing private wealth is enabled by ever increasing state debt, which is not a bad thing in and off itself! Rich people are not really the problem, unless unjustly earned, the development of wealth is!

I want to challenge your zero-sum thinking, of that classical monetaristic theory, that doesnt really capture the true nature of money. Modern monetary theroy, MMT, tries to do just that.

In MMT you have money sources and sinks. Ideally, a state or central bank is in control of how much money is created as debt and how much of it is paid back and vanishes *via taxation*. This creation and annihilation of money is out of balance for decades now!

Your question

> Where does the new money come from?

focuses on the source-side, which i explained broadly above, but is pretty much irrelevant today, because we have created enough money already in the past. The sink-side is politically and societally much more pressing, because having this gigantic wealth concentration, almost totally detached from and without any proportion to the real economy, with ticking interests and outside of public control, is like a hostage sitation. We need ever more money to keep our society up, but fiscal hawks keep reminding us, that we are not in charge of it.

Traders call it a "correction", when expectations meet reality and the stocks fall and technically and in the case of the US (as other countries too), such a correction is long overdue. GDP and stock markets go up while public spending and quality of live for the many go down. All enabled by banking deregulation and public/gov. retreat out of that domain of power, so the parasites can keep their unsustainable party rolling by throwing around funny money. And all the while, right-wing internet brainlets throw up something like "governments cant be responsible with money" or "we have no money for that very-needed-thing". This bullshit reaches back to reagan/thatcher, where this imo deliberate attack on fiscal public souvereignity originated. MMT is highly controversial in economic academia because this acadmic field is an exceptional joke (see their "nobel" price or that they still have no reliant model for crashes) and because MMT flips the existing power structure upside down, simply by highlighting the dynamic nature of uncapped money and the importance of proportional sinks/taxation.

> If poor people are spending more now then someone has to spend less. Who is it?

This implies that heavy taxation on the super rich will impact their spending behavior. I dont think this will be the case but even if, it will be totally worth it to keep the social fabric alive.

My depiction is probably grossly inaccurate but i think the broad strokes are true.

Re: The ultra-rich are claiming an increasing share of global wealth

#65

The question is where this will lead and what, if anything will, should or can be done to put the brakes on this wealth (re-)distribution. It feels as though over the last few decades, all we have seen is a continuing trend of increasing amounts of wealth being amassed by a smaller and smaller circle of people. What I find incredibly hard to judge is the point at which the current system leading to this will face vio…

Right. Those are the salient questions. Or to put it another way: extreme imbalance resting on actual or strongly arguable misaligned incentives lead to revolutions. At base justice is the issue. I prefer to avoid revolutions.

So, what are bad incentives and what'd we do about it?

Capitalism in the large is fine. In the medium lens tax avoidance by corporations, and those with a litany of cpas is a problem. The idea that the only function of a corporation is to increase share price is a problem. All these derive from a perspective that all that matters is the next reporting cycle or tax return.

I don't like the Chinese goverment, but i do respect the fact that they think longer term. Show me the money; show me the money is not the America we want or need to be.

Complicated tax code is another area the rich hide behind. Another problem is there are different rules for the top 5% and those connected to politicians. Our current administration in the US is a good example of just how bad that is.

Here is the US we have over corrected from the pre-Carter era in favor of the top 5% and corporations.

Re: The ultra-rich are claiming an increasing share of global wealth

#66

Earlier quoted context omitted.

Preach, brother! Because the ultra-rich surely weren't taking over the world under the previous administration!

This has been happening for a very long time. The current administration is just worse and/or more blatant about it than previous ones. So I agree with your sarcasm and I also agree with the parent comment that the current admin is doing a better job "clearly showing" how this works to everyone.

You say blatant, I say transparent. In terms of scale there is no difference, but the honesty is refreshing.

The only problem is it's causing people to focus on the wrong thing (us vs them, D vs R) instead of the oligarchs who continue to line their pockets (and by the way do not get re-elected every 4 years).

Re: The ultra-rich are claiming an increasing share of global wealth

#67
post #44

If you take any ancient or not so ancient civilization or kingdom, all the wealth including land and people's lives belonged to king/imperator which was appointed by god or something like that. Isn't is exactly the same with the system we have now? The question we have to ask is about 99% of population of peasants who work 8h a day same as they did in Mesopotamia. Do they have a living standard, healthcare, possibili…

This is very close to saying you wouldn't be against slavery. A slave could be given a decent quality of life. Does that mean slavery is acceptable? A person with 50 bazillion will be able to make you a slave if he wants to.

Doesn't then a person with half a trillion have that ability? At what point does the ability start?

Re: The ultra-rich are claiming an increasing share of global wealth

#68

Earlier quoted context omitted.

Here’s one - you presume the decisions they make about capital allocation are good and can’t be improved upon.

suggest how it can be different? this experiment has been tried many times - central planning.

You can’t imagine any other options between what we have today and central planing?

Re: The ultra-rich are claiming an increasing share of global wealth

#69

Earlier quoted context omitted.

The problem isn’t necessarily the wealth itself, it’s the power feedback loop that comes with it. It’s the ability to influence the government to pass laws which maintain or amplify your existing wealth, which then increases your influence, etc. There is nothing “free market” about this. There is no equitable or efficient destitution of resources when this kind of thing happens - and it will always happen, because it…

you are right that wealth increases power. that may be a problem. but i don't think redistribution can materially make people's lives better.

“May” be a problem? Come on man.

Re: The ultra-rich are claiming an increasing share of global wealth

#70

Earlier quoted context omitted.

Because of the lifestyle you can live while in debt. If you're driving expensive cars and living in nice houses and eating good food because you pay for it with a credit card, sure, you're in debt, but your life is better than someone that isn't using a credit card to pay for things. Are you going hungry? is the question.

Life in debt is better for now. But it will be way worse in the future if things won't go your way and they most likely won't. There's plenty of people willing to indebt almost everybody, because it's profitable. They sell temporary life above means for future wage slavery. The question is, do your really believe loan sharks and other lenders are saviors of the poor? In absence of lenders the issue of poor people wou…

> do your really believe loan sharks and other lenders are aviors of the poor?

How and what I believe society should be organized and who is good and bad has nothing to do with how society is.

Debt is negative, but it's that you can't just smush the two numbers together and have a valid comparison. A pauper with $0 to their name, living on the streets, and a person living in a $1 million house with $1 million in debt are living two very different lives.

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