Live data from Hacker News

Richest 1% will own more than all the rest by 2016

oxfam.org

81–90 of 136 posts

Re: Richest 1% will own more than all the rest by 2016

#81
post #78
post #69

I feel the serious point Oxfam are looking to make is let down by a definition of wealth that is very distorted. Their headline is based on a report by Credit Suisse [1] which defines net worth as: "the marketable value of financial assets plus non-financial assets (principally housing and land) less debts." Consider two people who will earn exactly the same amount of money at every stage of their lives. But one is 1…

Any simple definition is distorted, inevitably. Income, consumption or utility have a case. That said, wealth by this definition is most relevant in certain contexts. If you're worried about political consequences, for example. When the majority of property-wealth belongs to a small minority the majority have less reason to preserve property rights, for example.

The availability of credit will allow those that are asset poor but with reasonable earnings potential to compete for resources fairly.

There are of course very serious implications when, for example, asset bubbles and unfunded state liabilities will create unfairness between generations. That's an example of real inequality. There are many other forms of real inequality. Fake inequality is when two people with comparable earnings and abilities to purchase assets are treated as not equal simply because one is older and has had longer to save.

Re: Richest 1% will own more than all the rest by 2016

#82
post #49

Earlier quoted context omitted.

>Yet poverty as a whole is decreasing according to numerous measures. Yep. You lift people out of poverty through growth, something capitalists are very good at.

The world is about to enter a deflationary period. Perhaps capitalists are not the geniuses you make them out to be and just got lucky. Correlation != causation etc etc

How do you know the world is about to enter a deflationary period? With that kind of inside knowledge you can get quite rich.

Re: Richest 1% will own more than all the rest by 2016

#83
post #75
post #11

This sure seems to be HN's flavor of the month (and possibly for good reason). One thing I haven't seen mentioned is the fact that markets are created, not discovered. LLC's and Delaware C-Corps didn't materialise out of the aether, nor did the property rights regarding their shares. I dislike the concept of "deserving" at the best of times, but under this light, those that are the most successful reap their rewards…

Markets are basically people buying and selling stuff. If some people sell their houses there hence exists a property market and so on. If I sell houses and sell you a share in my business then shares exist. If you and similar people offer your shares for sale then a stock market exists. So these things come about fairly organically if people buy and sell stuff. The LLCs and similar are embellishments to make things…

This is an idealisation. Useful for demonstration and abstraction but rarely a total picture.

To take an extreme example, the idea that the house belongs to someone until they sell it is constructed.

For a more real world example, what does "own" fully mean? Can you start a business there? Build a skyscraper? Oil refinery? Do you own minerals? Flight paths? Can you demolish it or is it listed? When selling a house, you are transferring rights that are pretty variable and ethereal. These rules are elastic in practice and affect wealth.

Most large markets depart from the idealisation, many much more than real estate. Financial markets, minerals telecommunications... What does Disney gain from tweaking copyright laws? How does tax law play in?

I am pro markets, but I think we need to acknowledge that they are dynamic and emergent within constructs, not natural or inherent.

Re: Richest 1% will own more than all the rest by 2016

#84
post #67
post #42

Earlier quoted context omitted.

"Most capitalists would say that property rights naturally exist ..." I would like those capitalists to show me the "property rights" molecule.

The concept of "property rights without responsibility" is a Roman invention. There are alternatives. US law takes property rights more seriously than most other countries, because the US never had to get rid of feudalism. Also, one of the few lawbooks available in the early days of the US was Blackstone, who was a property rights absolutist. In feudalism, land ownership implies the obligation to protect the inhabita…

The comment you are replying to isn't disagreeing with you.

The people who believe property rights are "natural" aren't saying they aren't a human creation at all. Just that they are a human right, like other rights that are also human creations.

The justification for this is something like you own your labor and slavery is wrong, and if you use your labor to produce something, it's unfair for anyone to take it from you. Likewise it's your right to trade it for something someone else made, or do whatever. And from that you get capitalism and property rights as we know them.

However this argument doesn't cover property rights over natural resources or land. There are some arguments for that like the homesteading principle. But in general there is an argument to be made that natural resources should be publicly owned, or at least rented with the profits going to the public.

Also this argument is deontological. A consequentialist would say if violating someone's rights helps more people than it hurts, you should do it anyway. And an economist would point out that pure property rights don't work in the first place, because of market failures like public goods, common goods, information asymmetry, natural monopolies, etc. So everyone is better off if we violate them at least a little.

Re: Richest 1% will own more than all the rest by 2016

#85
post #49
post #3

Yet poverty as a whole is decreasing according to numerous measures. Plus their report contradicts the world bank observations: http://ourworldindata.org/VisualHistoryOf/Poverty.html#/Glob... Which is not surprising since Oxfam has a clear political agenda. EDIT: world bank poverty report, clearly showing the decreasing poverty rates globally: http://www.worldbank.org/content/dam/Worldbank/gmr/gmr2014/G...

>Yet poverty as a whole is decreasing according to numerous measures. Yep. You lift people out of poverty through growth, something capitalists are very good at.

Indeed witness the successes of Brazil! A country under the direction of US capitalism since 1964" with massive natural resources, no nearby enemies ... It's got very dire poverty and extreme wealth inequality.

Vs the countries in Eastern Europe with none of those advantages. Most Brazilians would kill to live like an average person from there.

Re: Richest 1% will own more than all the rest by 2016

#86

What about actors? The top 1% of actors make more than the rest of the actors combined. Is this fair? Should we tell Tom Cruise that he needs to take 80% of his paycheck for the next Mission Impossible movie and redistribute it to the actors that are not well-known and aren't making as much? How about something more relevant, like startups: Should it be fair that only 1% of startups make more than any of the other st…

Well I mean, maybe we should do that. Do you really think Tom Cruise deserves that much money for what he does? Or that the world is better off with that money going to him instead of someplace else?

Startups already distribute wealth a lot. Investors invest in many startups in order to get to that 1%. So even though they make a lot of money on Uber, they've also lost a lot of money on 99 other startups you haven't heard of.

Some investors do only invest in one startup, but no one is making them do that. So if they lose it is their own fault, and if they win it's only fair. They agreed to enter the lottery, that's a lot different than someone being born poor and stuck there. No one agreed to the lottery of birth.

Re: Richest 1% will own more than all the rest by 2016

#87
post #82

Earlier quoted context omitted.

The world is about to enter a deflationary period. Perhaps capitalists are not the geniuses you make them out to be and just got lucky. Correlation != causation etc etc

How do you know the world is about to enter a deflationary period? With that kind of inside knowledge you can get quite rich.

The central banks are turning off the money taps, growth is pretty stagnant across all major economies (bar the US and UK). Wealth inequality is rising while automation is arriving with a bang putting people out of their jobs and at an increasing rate and also putting downward pressure on prices as manufacturing costs fall, meaning the masses won't be spending much. China was a major driver of global economic growth but is undergoing a huge correction, Brazil has been in a recession since last year, Russia is suffering under sanctions, the Eurozone is becoming Japan mark 2, the price of oil is dropping like never before affecting the Middle East's ability to grow (notwithstanding the war currently ravaging the area). This all points to a period deflation.

Only people with money can make money with economic foresights.

Re: Richest 1% will own more than all the rest by 2016

#88

What about actors? The top 1% of actors make more than the rest of the actors combined. Is this fair? Should we tell Tom Cruise that he needs to take 80% of his paycheck for the next Mission Impossible movie and redistribute it to the actors that are not well-known and aren't making as much? How about something more relevant, like startups: Should it be fair that only 1% of startups make more than any of the other st…

Well I mean, maybe we should do that. Do you really think Tom Cruise deserves that much money for what he does? Or that the world is better off with that money going to him instead of someplace else? Startups already distribute wealth a lot. Investors invest in many startups in order to get to that 1%. So even though they make a lot of money on Uber, they've also lost a lot of money on 99 other startups you haven't h…

>Do you really think Tom Cruise deserves that much money for what he does?

People want to, and agree to, give him that money. What other measure of 'deserve' could there possibly be?

>Or that the world is better off with that money going to him instead of someplace else?

It doesn't matter. The world will be fine either way. People though? Tom Cruise is a person. The people paying him are people. They evidently think the arrangement is pretty good.

Re: Richest 1% will own more than all the rest by 2016

#89
post #75
post #11

This sure seems to be HN's flavor of the month (and possibly for good reason). One thing I haven't seen mentioned is the fact that markets are created, not discovered. LLC's and Delaware C-Corps didn't materialise out of the aether, nor did the property rights regarding their shares. I dislike the concept of "deserving" at the best of times, but under this light, those that are the most successful reap their rewards…

Markets are basically people buying and selling stuff. If some people sell their houses there hence exists a property market and so on. If I sell houses and sell you a share in my business then shares exist. If you and similar people offer your shares for sale then a stock market exists. So these things come about fairly organically if people buy and sell stuff. The LLCs and similar are embellishments to make things…

That house has value because it is connected to a road, power plant, sewer system, running water, etc. in a municipality that provides schools, EMS, firefighting, police, etc. Its future value is protected by zoning which ensures loud/ugly/polluting/busy buildings will not be located nearby. It is reasonable for the mortgage lender to make the loan because such contracts are enforceable in court, and it can count on the state to seize the house from a delinquent borrower even if the bank itself owns fewer guns than the occupant. The house is guaranteed to meet certain minimum workmanship quality and safety standards set by the state, verified by inspection, to minimize buyers' exposure to lemons.

Very little about the real estate market is emergent. This is an excellent example of a market created by society.

Re: Richest 1% will own more than all the rest by 2016

#90
So, I know this is a complicated issue that has been discussion with a lot of emotion and even anger. I find it very difficult to make any sense of it all, because it strikes me that in every discussion some crucial things are mixed up so much that the entire discussion strikes me as unproductive most of the time. In single back and forth's, we mix up:

- the meaning of words - the specificity of the argument (say, actor income versus a country versus the global economy) - the ethical assumptions underlying our argument - the actual facts

Personally I've been raised, developed my thoughts and occupy an environment that can be considered strongly on 'the left' of the spectrum (yes, also vague). That said, I really try to properly understand the 'other' side(s).

But it's difficult, considering that my entire world view is built on assumptions, arguments, lines of reasoning that are built on 'facts' and 'knowledge' that is 'leftist'. My left-wing viewpoint is like a realist painting while my right-wing viewpoint is more like a crude child's drawing. So obviously I'm more likely to reject the latter, and judge its proponents harshly, because it seems so stupid and primitive.

So I guess my question is... How would I best go about developing a more nuanced picture of the 'other' side(s) so that I can try to find 'truth' that is not conveniently aligned with my upbringing and current viewpoints, however difficult (or impossible) that might be?

I've been trying to subscribe to blogs that don't align with my views. I've also been trying to look into philosophical views that seem to further this, but I find it difficult because I don't really know what axioms underly these views so alien to me. So I don't always know where to look. I've been trying to respectfully read economic or social arguments (including pg's recent essay) that I have some fundamental issues with, but it all falls apart through sheer complexity and ambiguity (see: the discussions here where half the time people seem to discuss what pg actually said). And whenever some discussion does go into 'facts', I'd really have to read the sources where half the time I would need to study that particular field to even understand the abstract, not to mention that I can't really check the accuracy of these facts in the first place (and we all know that the further we get from the 'natural' sciences, the more ambiguous and slanted these facts become).

Here's the thing. I was raised an Evangelical Christian, and now I'm (basically) an atheist. The difference between these two paradigms is huge. I've believed both these sides with full conviction, so I know in quite a bit of detail how to defend many beliefs from either side. I feel that as a result, I can often pinpoint at which point in an argument things diverge, and I also feel I can reasonably choose in which direction to go. It also feels a bit schizophrenic and uncomfortable.

But the only reason I can do this is that I've basically studied theology and I've been immersed in this now-alien point of view for about 25 years, not counting the period of overlap where I was very confused about matters.

Obviously I cannot do that with an issue such as this. So what can I do, aside from try to assume that the viewpoint alien to my own is probably not as stupid or superficial as it seems? How can I assess a commenter's viewpoint when I don't have any knowledge of their background, honestly, or expertise as a person (which I do feel is important. we need to take shortcuts at some point).

It's incredibly frustrating, but I don't want to get stuck in convictions that I just happen to have chanced into, basically.

Post reply on HN