Do the Rich Capture All the Gains from Economic Growth? • Hacker News Board

Re: Do the Rich Capture All the Gains from Economic Growth?

#91

Post by snikeris » Thu, Oct 25, 2018, 6:38 PM UTC

crazygringo wrote: post #82

chrismanfrank wrote: post #73

Earlier quoted context omitted.

From the article: "The study looks at people who were 35–40 in 1987 and then looks at how they were doing 20 years later, when they are 55–60. The median income of the people in the top 20% in 1987 ended up 5% lower twenty years later. The people in the middle 20% ended up with median income that was 27% higher. And if you started in the bottom 20%, your income doubled. If you were in the top 1% in 1987, 20 years lat…

In other words, regression to the mean. Of course the poorest people are more likely to gain in income -- when you start at the bottom, there's really only one direction you can go. You can still have regression to the mean among individuals while society itself is becoming horrifyingly unequal.

Would you please elaborate on this:

> society itself is becoming horrifyingly unequal

Re: Do the Rich Capture All the Gains from Economic Growth?

#92

Post by kevin_thibedeau » Thu, Oct 25, 2018, 6:38 PM UTC

TheBeardKing wrote: post #31

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking…

I make less than I did as a junior engineer 18 years ago after accounting for inflation and COLA. Assuming my accumulated experience is worth nothing or I guess it apparently has negative value. Not all ships rise.

Re: Do the Rich Capture All the Gains from Economic Growth?

#93

Post by weberc2 » Thu, Oct 25, 2018, 6:42 PM UTC

billmalarky wrote: post #66

rukittenme wrote: post #6

I'd like to add to this argument. If Ohio's steel industry grows by 500% who reaps the benefits? Me? The guy writing code in Portland, Oregon? No... its pretty clear that a specific subset of people receive the benefits. The people who own the steel mill. The people who receive employment from the steel mill. The governments which tax the steel mill. But not me. Economic growth isn't uniform. Its an uneven field that…

>I don't know why anyone should feel entitled to economic growth if they didn't participate in it in any way. Tangentially related point: The problem occurs when advances in technology make it so the vast majority of humans are literally _unable_, not to be mistaken for _unwilling_, to participate in economic growth. In this scenario inequality shoots through the roof and that reasonably leads to instability and viol…

> A pragmatic wealthy person in this scenario should see wealth redistribution as a wise investment, not a cost, seeing as the "let them eat cake" alternative is less desirable if you like to keep your head.

This seems like a false dichotomy in that (for the foreseeable future) we have other options, like retraining people whose jobs have been automated away. This is strictly better (read "less invasive" and "more economically efficient") than wealth redistribution programs [^1].

[^1]: To avoid the motte and bailey fallacies that accompany poorly-defined or otherwise ambiguous terms such as "redistribution", I'm referring to the typical redistribution programs which take wealth from one group and give it to another group with no net increase in economic productivity. These are the kinds of programs which are controversial and objectionable.

Re: Do the Rich Capture All the Gains from Economic Growth?

#94

Post by mediaobs1 » Thu, Oct 25, 2018, 6:44 PM UTC

TheBeardKing wrote: post #31

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking…

[dead]

Re: Do the Rich Capture All the Gains from Economic Growth?

#95

Post by JAlexoid » Thu, Oct 25, 2018, 6:44 PM UTC

refurb wrote: post #83

TheBeardKing wrote: post #31

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking…

I think you're missing the point of the article. When you actually follow the same people , the poor see the greater increase in income than the most wealthy. You may poo-poo a $30K inflation-adjusted increase in pay, but that moves someone from the lower class to the middle class. Isn't that the goal?

That's social mobility, not wage growth. Those are not the same thing.

It's akin to arguing that wage growth is looking at income of a person that was flipping burgers while in school 10 years ago now leads an engineering team.

It's not the same job, not the adequate comparison.

I presume you work in IT related field, so imagine you decided to take a break and be a parking lot attendant... You cannot then quote your own example as an instance of falling wages for IT workers.

Re: Do the Rich Capture All the Gains from Economic Growth?

#96

Post by TheOtherHobbes » Thu, Oct 25, 2018, 6:47 PM UTC

snikeris wrote: post #91

crazygringo wrote: post #82

Earlier quoted context omitted.

In other words, regression to the mean. Of course the poorest people are more likely to gain in income -- when you start at the bottom, there's really only one direction you can go. You can still have regression to the mean among individuals while society itself is becoming horrifyingly unequal.

Would you please elaborate on this: > society itself is becoming horrifyingly unequal

https://www.cnbc.com/2018/07/19/income-inequality-continues-...

https://inequality.stanford.edu/publications/20-facts-about-...

https://www.businessinsider.com/inequality-is-deepening-us-e...

Will that do, or do you need more elaboration?

Re: Do the Rich Capture All the Gains from Economic Growth?

#97

Post by SketchySeaBeast » Thu, Oct 25, 2018, 6:47 PM UTC

kevin_thibedeau wrote: post #92

TheBeardKing wrote: post #31

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking…

I make less than I did as a junior engineer 18 years ago after accounting for inflation and COLA. Assuming my accumulated experience is worth nothing or I guess it apparently has negative value. Not all ships rise.

Was that large junior wage due to the 2000's cyber boom and was later readjusted to the new reality? Or has your wage actually remained stagnant / rose slower than inflation since that time?

Re: Do the Rich Capture All the Gains from Economic Growth?

#98

Post by conanbatt » Thu, Oct 25, 2018, 6:49 PM UTC

hopefulengineer wrote: post #89

TheBeardKing wrote: post #31

This bullshit article tries to paint a rosy picture of the economy by dismissing proportional median income gains between quintiles and instead argues that absolute income gains of individuals over time is enough evidence to suggest everything is actually great. This chart [1] seems to be the crux of their argument, as in - Surprise! Over 30 years poor people gained an average of almost $30k in income! I sure fucking…

It's supply and demand 101, illegal immigration combined with offshoring lowers wages and increases profit margin for the wealthy. Low wage jobs are taken by illegal immigrants, forcing US citizens to take on debt to go to college, where wages are also lowered because there are now thousands of college grads desperate to pay off their debt that can't be eliminated through bankruptcy due to congress being lobbied. A w…

Cant see the video now but is Bernie Sanders in favor of the wall then?

Re: Do the Rich Capture All the Gains from Economic Growth?

#99

Post by weberc2 » Thu, Oct 25, 2018, 6:52 PM UTC

TimJYoung wrote: post #74

weberc2 wrote: post #69

Earlier quoted context omitted.

It's not "shitting on" anyone; it's how (efficient) economics works. You don't earn more money unless you're producing more value. If a steel mill increases its output by way of some new automation, the accounting department and janitorial staff are unlikely to see a wage increase. The folks on the assembly line are also unlikely to see a wage increase because they're not more productive. The people who will be princ…

If you pursue "efficiency" to extremes like this, you're going to bump up against political and social realities that are going to ruin your efficiencies in ways that make giving pay increases seem like a no-brainer.

1. I don't think this is true in any meaningful capacity; it just means we need to find ways to keep a critical mass of people involved in productivity.

2. This is a different argument than the one to which I was responding (which seemed to be something like, "it's mean to have the opinion that economic systems reward productivity").

Re: Do the Rich Capture All the Gains from Economic Growth?

#100

Post by joe_the_user » Thu, Oct 25, 2018, 6:55 PM UTC

joe_the_user wrote: post #75

roymurdock wrote: post #37

The author Russ Roberts runs the EconTalk podcast and is a well respected economist/journalist/thinker in the field, definitely worth reading for a fair assessment. Here he presents a few studies that go against general economic consensus popularized mainly by Piketty in "Capital in the 21st century" and through papers/writing by Krugman, Saez, Zucman, Stiglitz, etc. that most of the economic gains in the past 100 ye…

The author Russ Roberts runs the EconTalk and is a well respected economist/journalist/thinker in the field, definitely worth reading for a fair assessment. The thing one needs to understand about economics is that it's field where analysis and advocacy have never been separate. It's not just Marx and von Mises that were strong advocates of policy. Smith, Ricardo and Keynes had the favored policy and thus favored wor…

Further, One might say there's a complex debate that goes between economists, where the arguments are framed as "how do we measure this policy's impact on equity, well-being and etc" but where each debater has their own emphasis and measure of these things. One pole might be a grim state socialism while another pole might be a Nietzsche/Harry-Lime view that "the goal of a society is to produce five great men and if the majority must be destitute for this, so be it". It's easy to say "we should be in the middle" but the reality talk of middles essentially involves where each debater wants to claim the "Overton Window" is located and so incrementally move it.