Top 1% now owns more of the wealth than the remaining 99% • Hacker News Board

Re: Top 1% now owns more of the wealth than the remaining 99%

#81

Post by dollar » Mon, Nov 02, 2015, 6:43 PM UTC

mikeash wrote: post #20

dollar wrote: post #3

Who cares about socialist propaganda like this? There is no evidence that "equality" in the distribution of wealth is good for middle class and low income persons. For example, if the distribution were more equal on a relative basis, but all brackets had less money than before, is that supposed to be an improvement?

Wealth means power. Let's take an extreme case: every person in the world has their wealth increased by 10% over what they have today, except for one person who has his wealth increased by $1 quadrillion. Everybody is better off, right? Except that wealthy person is going to rule the world, and stack the deck to help himself, and there's nothing that says he's only going to do it in such a way that everybody else kee…

I agree, wealth and power are closely related right now. But why? We could focus our energies on the distribution of power instead of the distribution of wealth. We could create a world where power and wealth were not so closely correlated. Arguably, our original constitutional government was a lot closer to that than we are today. That was when we had apportionment of 1:100000 in the U.S. House. That was when State governments elected their senators. That was when it was assumed that any State could withdraw from the Union, that any county could withdraw from a State. It was before a massive, centralized federal government.

Re: Top 1% now owns more of the wealth than the remaining 99%

#82

Post by afsina » Mon, Nov 02, 2015, 6:51 PM UTC

Lawtonfogle wrote: post #56

jayvanguard wrote: post #4

Earlier quoted context omitted.

Most normal countries aren't aiming for equality, they are just aiming for not-massive-inequality.

Equality and massive inequality are both bad because working harder doesn't help one get ahead. You want enough inequality so that those who work harder are awarded more, but enough equality so that everyone has a chance to work harder and get ahead (compared to current day where some of the hardest workers are barely hanging on).

`compared to current day where some of the hardest workers are barely hanging on` I am not sure if I agree. A software developer and a waitress at a restaurant perhaps works equally hard. However one job can be done by a thousand, other can be done by a million different people. One requires mastery, another may not. To me, only people does not work `that` hard are government workers and most academia. And boy they are a lot.

Re: Top 1% now owns more of the wealth than the remaining 99%

#83

Post by mikeash » Mon, Nov 02, 2015, 6:55 PM UTC

dollar wrote: post #81

mikeash wrote: post #20

Earlier quoted context omitted.

Wealth means power. Let's take an extreme case: every person in the world has their wealth increased by 10% over what they have today, except for one person who has his wealth increased by $1 quadrillion. Everybody is better off, right? Except that wealthy person is going to rule the world, and stack the deck to help himself, and there's nothing that says he's only going to do it in such a way that everybody else kee…

I agree, wealth and power are closely related right now. But why? We could focus our energies on the distribution of power instead of the distribution of wealth. We could create a world where power and wealth were not so closely correlated. Arguably, our original constitutional government was a lot closer to that than we are today. That was when we had apportionment of 1:100000 in the U.S. House. That was when State…

Wealth is ultimately the codification of power. A dollar is the representation of the power to get somebody else to give you a dollar's worth of value, or do a dollar's worth of stuff for you.

They are not perfectly linked, but I think they tend to come together. If someone has a lot of economic power, which they can use to get a bunch of people to give them things or do things for them, that's an avenue to political power. If someone has a lot of political power, they can leverage that to get economic power.

Your statement about how the original US government was closer to this than today doesn't sound right to me. Weren't only people^H^H^H^H^H^men^H^H^Hwhite men who owned land allowed to vote?

Re: Top 1% now owns more of the wealth than the remaining 99%

#84

Post by dollar » Mon, Nov 02, 2015, 7:02 PM UTC

dollar wrote: post #3

Who cares about socialist propaganda like this? There is no evidence that "equality" in the distribution of wealth is good for middle class and low income persons. For example, if the distribution were more equal on a relative basis, but all brackets had less money than before, is that supposed to be an improvement?

Everyone gets mad at me when I say propaganda. But just take a step back for one moment to consider the preposterousness of this wealth inequality meme.

A San Franciscan has a cost of living index that is ten times higher than a resident of Flint Michigan for the same standard of living. Read that statement twice, then realize that the San Franciscan _must_ pay more than twice as much in taxes as a percentage of income just to afford the _same_ standard of living. The hypothetical San Franciscan working an identical job as the Michiganite will not be able to afford the same standard of living. In what world is this "equality"? This is the problem with drawing arbitrary numbers out of thin air and labeling one number "rich" and one number "poor".

Granted, all things diminish on a relative scale in the extremes. A billionaire is rich in San Franciso or Flint Michigan. But how about a millionaire? Who gets to decide to draw the line between them, the citizens of Flint or the citizens of San Francisco! If you just said popular vote you fail. The problem is again with scale, you can't have millions of people voting on the fate of a minority.

This is why a centralized Federal government will never be equitable or fair. The Federal must necessarily be subordinate to the State, and the State subordinate to the municipality.

Re: Top 1% now owns more of the wealth than the remaining 99%

#85

Post by afsina » Mon, Nov 02, 2015, 7:02 PM UTC

fsloth wrote: post #31

dollar wrote: post #3

Who cares about socialist propaganda like this? There is no evidence that "equality" in the distribution of wealth is good for middle class and low income persons. For example, if the distribution were more equal on a relative basis, but all brackets had less money than before, is that supposed to be an improvement?

There are some statistical studies that show that in completely free market most of the wealth gets accrued on a few individuals. I.e. the population generates the wealth but only a few gain maximum benefits for a statistical fluke and no specific high performance input of their own. The question is - do we want to modify the free rules with income balancing or not. It's not about in the larger context about should a…

I do not think there is a sweet spot, or better to say you cannot stop in the sweet spot. Once you start redistribution, it never stops growing. Governments use social welfare as a bribe for votes. Every election new and larger benefits are introduced to overcome the overly generous competition. Taxes goes higher with different forms. Government hires more and more people. The more nationalization you make the more taxes you collect. Investment, profit and culture of entrepreneurship diminishes So you deviate from the hypothetical sweet spot quite fast. What comes sure next is economical depression.

Re: Top 1% now owns more of the wealth than the remaining 99%

#86

Post by nilkn » Mon, Nov 02, 2015, 7:04 PM UTC

alextgordon wrote: post #64

nilkn wrote: post #35

Earlier quoted context omitted.

Even if that's their methodology, I don't think it's that ridiculous. It's not like just anyone can go get an $800k mortgage. On top of that, you would stand to personally profit on any gains the home might see in the real estate market. To offer a slightly extreme example, I'd consider a recently minted surgeon with $300k in loans, a mortgage, and a $500k base salary to be considerably wealthier than the debt-free s…

> To offer a slightly extreme example, I'd consider a recently minted surgeon with $300k in loans, a mortgage, and a $500k base salary to be considerably wealthier than the debt-free small-town auto mechanic making $35k. Is this your perception or is it reality? If your hypothetical surgeon overleverages himself to the point where he has less on paper than the auto mechanic, his financial position sounds very brittle…

It's reality. The surgeon's monthly gross paychecks will exceed the entire gross annual income of the auto mechanic.

I actually crunched some numbers so you can see exactly what I mean. The surgeon's going to make about $26,000 per month after taxes in Texas (picked somewhat arbitrarily as that's where I live). They're going to pay about $3400/month in loans. And if they got an $800k mortgage, their mortgage payment is going to be something like $4800/month.

Net income: $17800 (i.e., almost 4x their mortgage payment).

Now for the mechanic. Net income: $2400/month. Let's say he gets a $100k home. His payment is about $540/month. So he's got $1860/month left over (i.e., about 3.4 times his mortgage payment).

He's actually less equipped to handle any sort of financial duress than the surgeon, all while living a much more constrained and frugal lifestyle and occupying a house with literally one tenth of the value. The mechanic's situation is actually vastly more brittle than the surgeon's, as on top of all of this the surgeon also has drastically better job security.

Now, sure, you can cook up an example where the surgeon is stretched too thin (e.g., $3-4M home instead of a $1M home, or a collection of exotic sports cars, etc.). However, the fact that the surgeon was even capable of making those unwise purchases in the first place means that they cannot be lumped into the same financial category as the mechanic.

Re: Top 1% now owns more of the wealth than the remaining 99%

#87

Post by [deleted] » Mon, Nov 02, 2015, 7:06 PM UTC

mikeash wrote: post #57

nilkn wrote: post #35

Earlier quoted context omitted.

Even if that's their methodology, I don't think it's that ridiculous. It's not like just anyone can go get an $800k mortgage. On top of that, you would stand to personally profit on any gains the home might see in the real estate market. To offer a slightly extreme example, I'd consider a recently minted surgeon with $300k in loans, a mortgage, and a $500k base salary to be considerably wealthier than the debt-free s…

Your extreme example is only going to be backwards for a few months, then the surgeon's proper net worth is going to pull ahead. So I'm not sure that's really worth considering too much. The fact that not everybody can go get an $800,000 mortgage is pretty much accounted for by the fact that you have to put down some sort of down payment, which translates into equity in the house. If you have an $800,000 mortgage the…

[deleted]

Re: Top 1% now owns more of the wealth than the remaining 99%

#88

Post by fsloth » Mon, Nov 02, 2015, 7:17 PM UTC

afsina wrote: post #85

fsloth wrote: post #31

Earlier quoted context omitted.

There are some statistical studies that show that in completely free market most of the wealth gets accrued on a few individuals. I.e. the population generates the wealth but only a few gain maximum benefits for a statistical fluke and no specific high performance input of their own. The question is - do we want to modify the free rules with income balancing or not. It's not about in the larger context about should a…

I do not think there is a sweet spot, or better to say you cannot stop in the sweet spot. Once you start redistribution, it never stops growing. Governments use social welfare as a bribe for votes. Every election new and larger benefits are introduced to overcome the overly generous competition. Taxes goes higher with different forms. Government hires more and more people. The more nationalization you make the more t…

"Once you start..."

I don't think there is any civilized government that does not perform redistribution. Taxes are a form of redistribution. Any government functions such as free schooling, are a one way to redistribute the wealth back to society.

Re: Top 1% now owns more of the wealth than the remaining 99%

#89

Post by chad_walters » Mon, Nov 02, 2015, 7:17 PM UTC

dollar wrote: post #79

hfourm wrote: post #53

Earlier quoted context omitted.

I would prefer HN to be a place where things like "socialist propaganda" aren't thrown around so loosely. Thanks.

I'd prefer a world where propaganda wasn't mistaken for journalism. I think it's important to label things what they are. Why is this piece propaganda? Because it presupposes a solution for a perceived problem and appeals to the popular. The problem is that the middle class and poor feel like they are struggling. But that's not what this piece says, it simply says that some people have more. Some people have too much…

Please point out where in the article a solution is discussed at all.

Re: Top 1% now owns more of the wealth than the remaining 99%

#90

Post by ThomPete » Mon, Nov 02, 2015, 7:18 PM UTC

afsina wrote: post #41

ThomPete wrote: post #25

Earlier quoted context omitted.

No but thats not the only outcome and it's disingenuous to try and cherry pick one just so that you can make a overly simplistic point. The Scandinavian countries re-distribute their wealth quite heavily and yet are still some of the richest countries in the world. I.e. everyone is better off.

So do you think this can be applied to say, D.R.Congo, Peru or India? There is a reason Scandinavian countries can have semi-socialistic governments. I have repeatedly say this: it is easy to play Socialism when your population is 1-10 million (All Scandinavian) , when you have natural resources (Norway) or high profit strong liberalized private industry (All). Clearly they will be tested by the coming crises such as…

Thats not the point. The point is that re-distribution does not mean that you can't increase the wealth of everyone which was that intended claim my OP.

Germany has a pretty big welfare state and are 80million people and they even had to take on eastern germany.