America's 1% Has Taken $50T From the Bottom 90% • Hacker News Board

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

#641

Post by nlbrown » Fri, Feb 12, 2021, 2:11 AM UTC

brandonr49 wrote: post #21

The problem of inequality in general needs to be framed as one of power asymmetry. There are a handful of people that have managed to garner, through their wealth, similar power to states with millions of people. The solutions to this involve either making money less able to purchase power, or taking some of this money away. I suspect the latter is more likely to happen but I'll happily support either method.

Indeed! There are even Think Tanks and the like dedicated to understanding this paradigm.

https://capitalaspower.com

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

#642

Post by BenoitEssiambre » Fri, Feb 12, 2021, 2:11 AM UTC

RhodoGSA wrote: post #618

BenoitEssiambre wrote: post #588

Earlier quoted context omitted.

Because I am fairly pro market but read enough mainstream economics to know that government paper retaining value more than private assets is much more of a distortion than said paper gradually losing value towards its intrinsic value of nothing. The thing is, stable money that predictably loses value is a great thing to have for the economy as it allows people to negotiate contracts and conduct business in a predict…

Great comment! Def made me think alot. Seems you can replace your entire argument with crypto. Money printer goes brrr, money gets locked in crypto, does nothing for the economy, leading to massive inequality. Crypto can be though of as "Savings" in your analogy. BTC might cause a economic meltdown if $10T gets locked in'Savings'.

I've been wondering about that. I'm not sure if crypto coins without being stabilized by central banks are a powerful enough force to cause the type of havoc that gold did during the great depression.

Then again, the potentially stronger network/memetic effects of cryptocoins, along with the amplification factor from markets being synchronized through instant all-encompassing global communications nowadays might make them dangerous to the economy without government involvement. We saw how much people can get hypnotized by these things during the Gamestop episode. I don't think unsophisticated investors' hoarding is enough to cause big problems but it is a bit unsettling that Tesla jumped on the cryptocoin train. If enough businesses follow suit, you get into scary territory. Last time it lead to Hitler and WWII. It makes me second guess my cybertruck reservation. I was on board partly because of Musk's audacious and epic attempts to bring humanity forward. This is a non negligible risk of going in the opposite direction of creating economic carnage that leads to new Hitlers (but with nukes).

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

#643

Post by biztos » Fri, Feb 12, 2021, 2:14 AM UTC

stefan_ wrote: post #318

salmonellaeater wrote: post #232

The framing in the article is ahistorical. The post-WW2 period was a period of exceptionally _low_ inequality. If you look back to just the 1800s there were swings in inequality comparable to the present day. We're now moving back to the historical baseline. There are some contributing factors to the shift in inequality, a major one being that labor is now oversupplied compared to the post-war period, and the competi…

Yeah well the 1800s were also a time where people barely traveled 50kms outwards in their whole life and slaves existed so why on earth would we take that as a barometer for anything.

I wonder how the enslaved population gets counted for calculating income equality.

If you’re legally someone else’s property, isn’t your economic inequality to that person immeasurably high? Not a number?

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

#644

Post by bvanderveen » Fri, Feb 12, 2021, 2:15 AM UTC

One of the things that ruffles my feathers about this genre of made-for-mass-consumption clap-trap is this sort of proclamation:

> Other nations are suffering less from COVID-19 because they made better choices

Which other nations? As someone who regularly reads francophone european news, I can assure you it isn't any nation in Europe. OP goes on to cite minimum wage, overtime pay, state-funded healthcare/childcare/education, and more powerful unions as choices Americans could make to improve their economic standing.

But broader economic outcomes such as wealth inequality in Europe has followed a similar trajectory to that of the US over the past 40 years, and since the start of the COVID crisis, civil liberties have been decimated by the technocracy's crisis response, medical outcomes even with their much-vaunted state healthcare systems are not significantly better than in the US, and small businesses are failing and people are falling into poverty at astounding rates. The ECB prints euros in lock-step with the Fed's dollars.

My intent isn't to make an argument for or against Euro-style social security features, but merely to remind that even with those features, Europe is not presently faring better than the US. Arguably coronavirus-related economic and social outcomes (medical outcomes notwithstanding, depending on the nation/state) in Europe are even more onerous than in the US at present.

Furthermore, this whole episode could sweep far-right parties into power in Europe. It's essentially a given, for example, that Marine Le Pen will run against Macron again in 2022, and not at all certain that she will lose…

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

#645

Post by norswap » Fri, Feb 12, 2021, 2:15 AM UTC

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…

I don't wish it on you, but imagine that the fed stops propping up the financial markets though QE.

"Irresponsibly over-leveraged and nearly bankrupted banks and corporations", allowed to crash and burn.

If this happens, everybody will be worse off - rich & poor alike, but the poor will pay the brunt of the cost. Except this time it won't be just "taxpayer money" that is on the line.

Consider it is possible for the fed's policy to be unfair AND the right thing to do at the same time.

There is no doubt that financial collapse leads to economic collapse. I find it difficult to claim both to be in favour of the common people, and to argue for a course of action that would set the whole world aflame.

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

#646

Post by Aunche » Fri, Feb 12, 2021, 2:16 AM UTC

CyberDildonics wrote: post #484

Aunche wrote: post #438

Earlier quoted context omitted.

Where did you get $40,000 from?

5.3 Trillion in stimulus divided by 150 million people who pay income tax in the US is actually $35.3k USD. The final stimulus toll may be higher and taxes come from a variety of places so that may be high for the final burden per person, but I think it will be close by the time all is said and done.

The stimulus checks, unemployment benefits, at least 85% of PPP money, and education funding all solely benefit regular taxpayers. Large corporations got the equivalent to subsidized loans. Let's say that random pork projects benefit both groups equally. I don't see how regular taxpayers are losing out here.

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

#647

Post by clarkmoody » Fri, Feb 12, 2021, 2:17 AM UTC

nostrademons wrote: post #228

JamesLeonis wrote: post #122

Earlier quoted context omitted.

Except this wasn't the federal bailouts. Those are an entirely different beast. It's talking strictly about income stagnation. The study shows that if wages kept up with productivity (as was the case in the immediate post-WW2 era) the bottom 90% would earn $2.5 trillion per year more. > We document the cumulative effect of four decades of income growth below the growth of per capita gross national income and estimate…

Why do you think wages haven't kept up with productivity? The decoupling of wages from productivity started around 1971-1973, which is suspiciously close to the Nixon Shock and beginning of the 1970s inflation. In periods of inflation, firms with high bargaining power (notably monopolistic corporations, corporate executives, and right now, software engineers & quants) can extract the excess money floating around. Fir…

We also fully unlinked the money from gold in 1971

https://wtfhappenedin1971.com/

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

#648

Post by tylerhou » Fri, Feb 12, 2021, 2:18 AM UTC

notriddle wrote: post #512

tylerhou wrote: post #383

Earlier quoted context omitted.

Taxes?

The Fed can't make taxes. Congress makes taxes, but Congress is subject to popular approval, and the population don't like tax hikes.

The Fed also can't give $1000 to everyone.

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

#649

Post by colecut » Fri, Feb 12, 2021, 2:18 AM UTC

jazzyk wrote: post #619

evo_9 wrote: post #609

Earlier quoted context omitted.

No, 100% for sure everyone does not know or understand this. Most of my family are clueless about this stuff; do you think Fox News - their and many peoples only news source - are sharing that bit of insight with their audience?

Why bring politics into this? Most of my economically clueless friends are liberals who only watch CNN and read NYT. Economic Ignorance is widespread and bipartisan.

I don't see any political implication. He singled out Fox news because that is what his family watches.

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

#650

Post by Aerroon » Fri, Feb 12, 2021, 2:18 AM UTC

f38zf5vdt wrote: post #581

notahacker wrote: post #496

Earlier quoted context omitted.

This narrative also has the effect of deflecting attention from other policies which contribute towards inequality an awful lot more. It's not like the majority of recorded history on the Gold Standard was noted for the bottom 90% enjoying relatively large shares of national wealth and income security.

Yet, paradoxically, the economic golden era of post-WW2 United States from 1946-1969 was entirely on a gold standard.

It might be related to the gold standard, but I'd argue that WW2 was a bigger factor. The US was already the strongest economy and the competition was devastated by war. Add on to that the development of the intermodal shipping container and it was suddenly possible for the US to transport their goods cheaply. The reason this golden age ended is that other countries had finally recovered from the devastation of war.