How about we just don’t empower a central planning body to make monetary decisions that devalue wages & salaries while inflating asset prices? QE & LIRP have literally been “rich get richer, poor get poorer: the policy”. People educated enough in finance to follow the effect tend to be in the asset-holding camp so there is less complaint.
I’m not advocating high rates as good for the poor; I’m championing shaping the yield curve with a market mechanism. It might be too late for that to be anything other than disastrous though, after years of addiction to funny money.
The most frustrating part of economic arguments, right there.
There is an official policy that prices will go up exponentially, controlled by a tiny committee who implements the policy by, effectively, money printing. The official justification is a just-so story with no compelling evidence that I've ever seen. We seem to have gotten there because politicians don't like sound management any more than anyone else and just borrow and spend until the money runs out. And the outcome is asset owners get an enormous leg up over everyone else and the biggest asset owners get privileged.
Given the level of this-sounds-crazy in the policy mix there should be much better justifications for all this policy than people accept. We should routinely be seeing actual studies by real economists justifying this madness. It looks like trash policy.
It probably exists. I don't see any reason that it should always be a good idea to lend money. But the link between "it is a bad idea to lend money" and "therefore we should cause prices to rise exponentially" is absurd on its face. The obvious alternative is people shouldn't lend out money until someone figures out a good use for the borrowings. I've never heard an argument that justifies a policy response.
There are a couple of metrics that I'd accept as a goal for the economy. Maximising median leisure time, maximising wealth creation, maximising payoff for working hard, minimising waste. Something like that or any reasonable combination. I don't think exponentially increasing the prices of goods and services helps with any of those. As far as I can tell it just transfers wealth to asset owners. Which is nice enough if you are an asset owner but it seems arbitrary, unfair and pointless to me. I propose alternative strategies of asset owners have to rely on the value of the asset to make money, rather than waiting for handouts.
I own enough assets that this policy probably benefits me. But it also appears to be causing terrible damage to the community and general faith in capitalism so I expect there will be a nasty backlash at some point that will outweigh the short term benefits. I can't buy stuff if people don't see a benefit in making it.
Can you explain what you mean when you say "it transfers wealth to asset owners"? My understanding of wealth is assets, so the phrasing doesn't make sense to me.
I think you mean to say imply that wages don't increase, so relatively speaking wage-earners are poorer if assets become more expensive and wages don't rise?
The counterpoint is: Wages are at level X1 relative to price level Y1 because labor can demand these wages. If the price level rises to cY1, there is no reason to think wages won't rise to cX1, so the ratio stays the same?
New wealth is being created all the time by the fusion of labour and capital. There is a bit of a balance of how it is distributed - most of it goes to capitalists and some of it goes to labourers (labour labours, spends what they feel is necessary then buys capital with the rest. Over time they become wealthy capitalists too and we all get to be rich. In theory, a lot of people just waste the opportunity even under the best of conditions :[ ).
Over a long enough time frame money printing does nothing, but in the short term there is an effect where the first people to get the money benefit from distortions where they get more short term economic power (in the US typically bondholders, I suspect there are also programs of interference in stocks [0] although that is more of a theory).
I argue that when new capital is created, under a free market more of it should be going to people who draw wages. If I was right, I'd expect symptoms under the current system like people struggling to save, struggling to afford homes, etc, moreso than in the past. People being unable to transition smoothly from being labourers to capitalists and the middle class slowly shrinking.
The way the accounting identities shake out, I'd expect to see exponential increases in every price and valuation but consumables would rise slightly faster than wages and it'd become less and less effective to people relying on their labour to save.
* Part 2
But there are also secondary effects - because now "being an asset owner" is unfairly rewarded, people start creating fake assets in the hope of getting in front of the money hose [1]. That leads to misallocation of capital which IMO is likely to lead to major losses. If capitalists are incentivesed to own assets in the abstract rather than own assets that are actually productive then eventually the system has to recognise big losses because allocations aren't performing.
To give a specific example of that, if you happen to own gold the market is signalling that you have been making consistent "real" (ie, in excess of CPI) returns for something like 20 years. That is obvious bunk, gold is a dead asset that does nothing - the real price might jump up and down a bit in a band, but it doesn't climb steadily at that rate. I'm being asked to pretend I'm getting wealthier each year through my gold holdings, and a lot of people aren't switched on enough to realise that is a fake signal. The market is encouraging unproductive allocations because the metrics are being cooked. And the metrics are being cooked [2] likely on purpose - because it is in the interests of nobody powerful to stop printing money and let labour draw a bigger share of the wealth. Good metrics would suggest that as the obvious thing to do.
> Who got poorer?
Anyone who earns by them working. Especially people who try to retire.
The long story short here is the economic system is overly rewarding people who own assets, encouraging people to invest in bad assets and none of monkeying around with price levels is helpful. It just makes it harder to figure out what is going on.
[1] I'm basically in on this, I don't mind too much about whether my investments actually have good fundamentals because I'm looking to get in on the money printing. It has worked out great for me if you believe the CPI is important. Acceptable after doing normalisation against the M2.
[2] Totally different topic that I'm only alluding to here. Economics favours long blog posts or books, HN isn't really wordy enough to have a satisfying argument.
You wish it was money printing. It's just plain greed. Without money printing what you'd get is even higher inflation. (Though probably only by some percentage.)
Any excuse is good to raise the price if some people really need your product and it doesn't jeopardise your demand enough.
(This is called demand inelasticity.)
No price fall is needed or done when the excuse goes away.
If you control supply side sufficiently, you can also use that to further raise prices and keep them high.
Thus equilibrium economics efficiency arguments fail.
Housing has limited but highly inelastic demand. So does food, water, healthcare, energy, fuel.
Some of these cannot be substituted easily either.
And the smarter capitalist to get maximum profit will do anything to make this demand yet more inelastic by reducing choices, especially away from their control. Be it by monopoly, cartel, tacit cartel, hostile takeovers, PR to bury options, government intervention, over or underregulation...
Assets are liabilities unless they're directly in demand or are actively capital (as in used to make things). For example, having houses nobody can buy that will disintegrate is a liability. It's even clearer with office buildings which are a bit more elastic in demand.
Unless you control most housing and can thus enhance relative demand, of course...
The justifications for current capitalism are very vacuous based on willing misinterpretation of it. Even ignoring the whole monetarist view which is a second order misinterpretation.
This is complete nonsense. The purpose of inflation as a policy is to increase employment by decreasing the real cost of labor: in short, it's sneakily stealing money from the labor class to keep the employment metric high.
This is the primary cause of the poor getting poorer. Greed has nothing to do with it. Greed is linear. O(n). Inflation compounds. O(e^n).
Greed is unbound, if it is really greed. And it’s exponential, if it simply means ambitious and wise use of resources.
I would ditch the psychology economic babble.
There is certainly a case to be made that increasing employment by expanding the money supply is an addictive short term fix paid for with predictable long term damage to the purchasing power of existing laborers.
Inflation leaves valuable assets just as valuable, but undermines fixed or sticky income streams.
"In 1907 there was a financial crisis. We learned our lessons and created an institution to prevent the next crisis. So, the next time things went south in finance, in 1929 there was no crisis. There was a catastrophe instead."
In the wake of the 1929 crash and The Great Depression, a huge swath of regulations were put onto financial institutions so as to limit the riskiest investments with money in personal savings and checking accounts, aka Glass-Steagall. FDIC insurance was also born in this time.
Prior to these changes, bank runs and financial crises occurred about every twenty to thirty years. By contrast there were none until the 1980s S&L crisis following…major deregulation of the financial sector.
Many provisions of Glass-Steagall were repealed by late 1999. Less than ten years later, risky investments using consumer monies mostly in the form of real estate mortgage-backed securities imploded.
Deregulation of the financial sector often brings short term windfalls with near term crises and catastrophes.
When folks trot out the old "government is the problem" canard, I can't help but point out the economic arsons working on Wall Street and/or owning huge buildings in the middle of downtown financial districts. The government sometimes f's things up due to bureaucracy and ineptitude. The financial sector always f's things up because risk means nothing to them when it's someone else's money and they get their bonuses either way.
One makes infuriating mistakes. The other doesn't make mistakes; only self-interested sabotage. I consider the latter a greater evil frankly.
> Prior to these changes, bank runs and financial crises occurred about every twenty to thirty years.
That isn't in itself a bad thing. There needs to be a mechanism to punish people who give their money to charlatans and to reign in malinvestment. If there aren't occasional bank runs then that suggests an excessively cautious investment environment that is destroying potential wealth. Or a lot off government bailouts to cover excessive risk.
As you point out in a few lines with the "risk means nothing to them" comment, a situation has been set up where only the government cares about whether the risk profile being taken on is appropriate. Bankers don't care because it isn't their money, depositors don't care because it isn't their problem. That is a very poor outcome, everyone should care about that. People are presently empowering incompetents by flooding money into stupid ventures and they get no feedback about the damage they are doing.
Mass voting once every few years combined with committees of professional bureaucrats is an ineffective way of doing risk assessment. This has to be something that people work out with their bankers on an ongoing basis. The US would look completely different and probably a lot better to live in if these incentives were corrected.
It is interesting that in the crypto space a group of people have gotten so sick of this that they're going and making their own financial system (with hookers and blackjack, one suspects). It is a really interesting ongoing experiment because if the situation plays out in the obvious way, we're going to see a much healthier system in crypto. We've already seen any number of frauds cleaned out that'd probably have gotten away with it in traditional finance. And the way Tether eventually explodes will be a really interesting case study.
Previous generations learned the hard way that when you lose your life savings, once is too often. A lot of folks never recovered after the first time it happened to them. Identifying a huckster isn't as easy as you say. A lot of folks lost everything in a local savings and loan, not some fly-by-night penny stock broker.
Crypto will not stop this. Crypto has no intrinsic value. A car has intrinsic value. A house has intrinsic value. Farmland has intrinsic value.
If everyone decided all these things had zero currency value, you can still transport using the car. You can still keep the rain out in a house. Crypto leaves you with electron patterns in a box.
When the US dollar has dipped (and gold has gotten stronger), has the measured value of any crypto "currency" increased proportionally? No. Often it dips along with the dollar. When folks feel the crunch, they sell their crypto to pay bills. The reduced demand lowers the value of crypto. When the dollar is strongest and employment is robust, folks buy more crypto with their increased disposable income, raising demand and proportionally the price.
It's a Ponzi scheme. A Ponzi scheme with a much higher fraudster-to-legit ratio than other financial options. There ain't no FDIC for Bitcoin. Be prepared for crypto's 1929 moment.
If you add all the pieces in your first paragraph together, the obvious answer is people need to stop giving all their money to 1 institution that they can't assess the creditworthiness of. It is a bad idea. Even if the money is then backstopped. The current system encourages them to do this.
And you say "lost their life savings" as though the current system doesn't do that. Anyone who has attempted to hold their life savings in a bank is being gently wiped out by inflation. We traded "might happen" for "government policy that this will happen". They're losing most of the value in their cash every 25 years. The official policies are consistently inflation combined with low interest rates.
> Be prepared for crypto's 1929 moment.
Hasn't it has already lost 80% of its value more than once? I'd hope people are prepared with a history like that.
> the obvious answer is people need to stop giving all their money to 1 institution that they can't assess the creditworthiness of.
You literally just described everyone who has a bank account. The finance sector is anything but transparent. See: Bear Sterns.
> I'd hope people are prepared with a history like that.
People play the lottery. Humans are REALLY bad at probability. There's an argument that the human brain itself is bad at it. Human perception is the source of optical illusions, sleight of hand, logical fallacies, etc. We are not biologically primed to handle these kinds of problems.
Snake on the ground is a threat? Excellent. Monty Hall Problem? Even after explaining it, a majority of folks still reject the solution because it isn't naturally intuitive.
ttfkam: "You literally just described everyone who has a bank account."
In some sense, well spotted. That is why I think the system is a bit cooked. People can't just put hand their money over to one institution, ignore what is done with it and expect to get a good outcome. This is a good way to get vast capital misallocations and, eventually, a lot of people ending up poor. More people than the alternative of the occasional bank run. I can see an argument for setting up full-reserve banks. But if people are going to lend their money to institutions that on-lend it, we should be seeing banking institutes get rolled up regularly and depositors losing at least some of their money. People shouldn't be allowed to ignore what is done with their money; it leads to some of the worst incentives in the modern economy.
But technically no, some people have their money spread over a few institutions. And most people don't seem to have cash savings these days anyway (which is rational given the inflation regime).
Oh yeah, and Bitcoin mining alone is 2% of all electricity consumption in the US. Nonsense. Absolute insanity. The definition of wasted resources. Those are all EV vehicle charging numbers.
If people would rather burn 2% of the electricity in the US rather than deal with financial regulations, that does say something about the financial regulations. Although at this stage it is a bit unclear exactly what.
Bitcoin and other crypto get big enough, regulation will follow shortly after. That said, the first to flee regulation in the financial sector are much more heavily weighted toward the grifters and fraudsters.
See: Mt. Gox
People flocked to Bitcoin because they saw people get rich. That's it. Real estate is very heavily regulated by comparison and yet folks were buying, selling, and flipping like crazy. People want money. Regulations are an excuse, not the primary motivator.
Monetary policy could probably be implemented through some other means than real estate, which is what I interpreted the suggestion to mean. QE as it has existed was a real example of Friedman's "nothing so permanent as a temporary government program": a reaction to the housing bubble becoming a default tool of monetary policy.
Whatever you think of 1907, the US went from a highly unequal society (an entire sector of citizens not even owning themselves) followed by being a failed state after an an insane civil war that decimated the population... To world power with a much MORE equal society, in five decades with no centralized financial institution
If I have 10 pounds of blueberries and you have 10 pounds of strawberries there will be a natural price for one in terms of the other based on our different marginal preferences for the two commodities.
Think of a dollar today as one commodity and a dollar tomorrow as a separate and distinct one. There is a difference in our marginal preferences and that is where the interest rate comes from.
Just as both of us can be made better off trading blueberries and strawberries without actually creating anything new, the difference in our inter temporal marginal preference will reward the lender with a return even in the absence of risk.
Thank you for an example with fruit. I am not trying to be thick, but your last paragraph confuses me. My point of reference is, say, lending $1,000 to a sibling who will pay me back within 2 weeks when he gets his paycheck. I gave him $1,000 and he will return me $1,000 so when and how would interest arise here? What axiom am I missing that makes his debt increase? Is it a choice by me to demand it?
Isn’t that confusing cause and effect? You’re getting interest because they’re paying it to you. They wanted to borrow, and even if there’s no risk, you won’t lend it out for free.
But as an academic exercise, you can stipulate risk free lending as axiomatic, and still see that a natural interest rate comes from different inter temporal marginal preference for money among entities in the economy. It’s only zero if everyone’s preference is identical.
The interest rate I'm referring to is the cash rate, ie. the rate at which banks lend to each other. That's the interest rate central banks set and defend using the sale and purchase of bonds on the secondary market.
If they didn't prop it up, it would tend to zero because banks have so much liquidity.
If you're lending someone a billion dollars, and your labour cost for doing the lending is in the hundreds (maybe thousands?) of dollars, then interest rates quickly approach 0.
Sure, no-one would do it for literally 0 dollars, but the rates at which banks lend to each other when there is a ZIRP policy at the central bank (including 0% paid on reserves) is negligible as far as the real economy is concerned.
Like the "cost of capital" in that case for issuing a mortgage has nothing to do with the interbank lending rate.
Adding this to my reading list. I've thought for years that we should place at hard cap on wealth somewhere around $10 or $15 million. Because that's the point at which you have enough wealth to live a comfortably middle class lifestyle for the rest of your life, still pass down a substantial chunk to your children, and never have to earn another cent.
I've argued we should combine this with a move towards a worker owned economy - in which businesses are democratic institutions governed by the people who do the work involved.
But either of these changes on their own would do _substantial_ good. Going to make a note to read this book!
It's just not practical to enforce a cap though. Even with a very authoritarian world government to stop people moving assets elsewhere, there'll be too many ways around it.
So you can only have $15mil of assets? But your partner can have $15mil too, as can your kids, and parents. And if that's not enough, you can still try to hoard extra wealth in easier-to-hide forms - whether it's physical gold, bitcoin, art, fine wines, etc.
Or worse still, the super-rich will realise that they can spend many times the wealth cap per year consumable/disposable items (so long as they stay under the cap, or get back there by year-end), and become more wasteful. "Might as well spend a few million on a private jet, if I don't, I'll hit the wealth cap!".
Its not that its not practical as much as it is actively counterproductive to progress since the minimum effective size in many sectors is larger than that so you would end up force liquidating founders out of companies they start, which is a bad thing in for progress in mlst cases. You want quality founders to ma*ntain control and grow a business up to the point it starts abusing market power rather than innovating and that is often far beyond 15 mm valuation. Tje real problem is the market power and that is when heavy regulation and breakup should set in, not at some arbitrarily low asset limit.
But even in your family hypothetical, the overall inequality is still much less than between billionaires and the middle-class (nothing said of the truly destitute).
> Or worse still, the super-rich will realise that they can spend many times the wealth cap per year consumable/disposable items (so long as they stay under the cap, or get back there by year-end), and become more wasteful. "Might as well spend a few million on a private jet, if I don't, I'll hit the wealth cap!".
This is a very interesting point! I'd worry less about rich folks spending to be below the cap (that money re-enters the economy), but rather evasion by sending money back and forth between a small set. Clearly evasion would need to be monitored.
Next come regulations about having to "cooperate".
Then the question will be raised as to what happens to those rich people who don't cooperate, or middle class / poor people who, god forbid, don't agree with this plan for society. Pretty soon, you've got your jackboots and your re-education camps.
I'm trying to parse if this is meant to be an argument against enforcing limits on wealth, and if so, point out the humor that we already reached the road of monitoring through having corporations have uncapped power.
An argument could be made that the big social media companies are also taking care of re-education, although through less overt means.
No it didn't - there were multitudes of loopholes. Nobody paid that much.
The real way to measure the size of the state is % of GDP. This includes shadow taxes such as printing-induced inflation and deficit spending.
And guess what? The size of the state skyrocketed from a historic baseline of 1-2% to 35% in recent decades. Every now and then there's a war or a crisis and spending pops up like crazy, but it always used to go back down. Not anymore.
The only time it's been higher than this year is in WW2 and during Covid.
Now that tax rates are lower again compared to the "90%" rates, is the same saying not true for today compared to that time period?
So, surely, you will agree the people who live the easiest and highest quality lives are people today, and lowering tax is actually fully indicative of increasing life expectancy and quality of life.
As we've cut taxes beginning in the 1980s, most people in the US have been living worse. Now life expectancy has been dropping, iirc home ownership, access to education, etc.
I don't mean there's a 100% direct correlation, but that investment is needed for returns. If we don't invest in healthcare, we'll have worse health. If we don't invest in education, etc.
What returns? A very important part of "investing" is ensuring your losing positions are cut early and cut fast, its not continuously putting money into a black hole hoping one day the worst of the worst magically becomes the best of the best.
The rest of your comment is you being quite inconsistent, and frankly, a position that is full of lies.
Of course the economy was much smaller then, especially on a per capita basis, and modern capitalism hadn’t had time to create the safe, abundant, filled-with-medical-marvels lifestyle we enjoy today.
> Of course the economy was much smaller then, especially on a per capita basis
Indeed, and even more on an aggregate basis, the population also being much smaller.
> modern capitalism hadn’t had time to create
You're assuming that was created by modern capitalism, which I think is a major flaw. Capitalism contributed certainly, but so did democracy, freedom, rule of law, government investment, civil society, etc. etc. Just look at most of the education system, courts, security, roads, most of science, soldiers, etc etc etc.
> abundant, filled-with-medical-marvels lifestyle we enjoy today.
A great many, maybe most people in the US don't live in that world.
Whenever people talk about how much wealth is comfortable (or ethical) to have, its usually just a notch above their own (well within their social class status).
To be fair I don't know your wealth at all but its just an observation I've had from talking with others about this. The end result of this would be to make these people some of the wealthiest in the country by dragging the wealth curve to just above their level. It sounds like a moral hazard to me.
> Whenever people talk about how much wealth is comfortable (or ethical) to have, its usually just a notch above their own (well within their social class status).
I haven't observed that, and it's very unlikely the GP is a "notch" below $10-15 million.
I can't find it, but I think pg also said something like "when you're 20 if you're not doing bad you feel good. When you're 50 if you're not doing good you feel bad."
Which seems like common sense. A 50yo has fewer years to with to save up for any retirement, they face age discrimination, increasing health issues, etc. A 20yo has many years to work and pivot on case of setbacks, less age discrimination, usually fewer health issues.
I bet you've discovered the cause of this effect. I suspect we're seeing people who live comfortable lifestyles say "this seems about right" and then hedge a bit.
"Everyone driving slower than me is a slowpoke, everyone driving faster is a maniac"
This was on full display back in 2017-2018 when tax code was changed to limit the amount of State and Local taxes (SALT) that could be deducted from your Federal tax liability. The original SALT deduction, before the change, clearly benefited the wealthy, with large mortgages and living in high-tax (read: expensive) areas.
Cue articles like this one [1], which shows just how out of touch the wealthy can be:
> estimate the tax law’s impact on the value of a theoretical house in the New York City suburb of West Orange, New Jersey, purchased for $800,000 in 2017 by a theoretical family with a $250,000 annual income. Those home value and income numbers are very high by national standards — but middle class by the standards of large parts of suburban Essex County.
In 2017, $250K/HHI was in the top 5% of the entire US. Someone living in a house that cost 3X the median house, in one of the richest areas of the country, making more than 95% of everyone else considers themselves 'middle class'.
> Cue articles like this one [1], which shows just how out of touch the wealthy can be
Cue comments like these that show just how out of touch people can be I guess.
These people are not meaningfully wealthy. They have no more power than the next 5% down the ladder. Even among the top 1%, 90% are not meaningfully wealthy in terms of the power they can exert.
The idea that some poor bozo with a mortgage on an $800k house is wealthy for any useful definition of the term is nonsense.
They don't consider themselves middle class, statistically they are middle class based on (income, wealth, purchasing power, etc.). They aren't out of touch - nobody asked them - they just live where there's a higher cost of living. But it pays off, or they would move someplace less expensive, and housing would cost the same nationwide.
They are not middle class by any metric. They may feel overextended, but that can happen at any income level, and (as in this case) is often due to the spending side of the equation.
They are by the metric in the article, and in the scope of their locale. I get your point, that they have lots of money. But at the same time it's not relevant: Just moving doesn't solve any problems, because they'd be much less productive in their new destination and have much less money. They are gathered around and investing in - very successfully and productively - the high-productivity resources of NYC, which produce higher income, which produce a higher standard of living.
The average US locality's economy produces more wealth and requires more expense to live in than the average locality in a low-income country. You can't just move the Americans to the low-income country; they wouldn't be nearly as productive, and thus have less income. NYC's economy is more productive than almost any place in the world.
We could widen the scope to all of human history, and then we're all unimaginably wealthy compared to hunter-gatherers we were until 10K years ago. But does that mean we're just as wealthy here and now?
Are Elon’s rocket and car company infringing on your well-being? What about the pensioners holding Tesla shares? Are they stifling your ability to come up with some funds for the public good?
They are paying their share, for every worker they pay the appropriate taxes on the wages and those taxes are there to provide the common welfare, defense etc. since they pay their workers quite a lot they probably pay more than needed, so not sure why you would single them out, many companies pay much less like Walmart etc, they pay so much lower salaries so therefore contribute way less taxes per person they need to work there, complain about those first.
Why is that amount their share, and not more or less? Corporate taxes are pretty low, and also capital gains, so I tend to think it is much less.
Oh, I forgot, poor victim Elon! The right-wingers pull out this rhetoric so consistently, it's a parody of itself every time. But now Elon Musk is a victim? Whose next? Trump?
It's not "their share", it's your fantasy of getting part of their money that you're trying to impose. None of that money is yours to decide the fate of it.
How do we pay for the enormous amount of common public goods, such as roads, a legal system, safety, security, education, health, NASA, etc etc, if we don't jointly pay for them?
And if we jointly pay for them, don't each of us have a share to pay?
(I think we both are in good faith. No need to imply I'm a thief or oppressor.)
That's a separate question. The fact that you want to do something doesn't make you automatically the owner of somebody's else money. You can't just say "I want to do X therefor it's fair that Elon Musk will pay for it, and if he doesn't, he is evil and must be jailed". There's nothing "fair" in this. It's not what "fair" means or ever meant. Especially given that Elon Musk is already paying for so much - and still you think it's "not fair" he doesn't pay more, with the sole foundation for this being that you want more.
> And if we jointly pay for them, don't each of us have a share to pay?
Yes, but despite them paying orders of magnitude more than you do, you still complain they don't pay their "fair share", the definition of "fair" being based solely on the fact that you want them to pay more. I don't see any justification for claiming this has anything to do with "fair".
> The fact that you want to do something doesn't make you automatically the owner of somebody's else money.
That's exactly what I was thinking. I am the owner of your money, in fact. Hand it over. Post your BTC here (nobody else touch it, it's mine).
> "I want to do X therefor it's fair that Elon Musk will pay for it, and if he doesn't, he is evil and must be jailed"
We are equal under the law and we all should pay for it, nobody treated differently.
> the definition of "fair" being based solely on the fact that you want them to pay more.
When did I tell you what my basis was?
The image of Musk whining 'it's not fair' like a 6 year old is pretty incredible, but in fairness to Musk, someone else is doing it. But for reasons unknown - why are you advocating for this complete stranger?
I just point out your pretense at "fairness" is nothing but deception, and you have to resort to clowning and ad-hominem attacks as a response, which indeed proves you don't have any proper argument beyond "me want!". If is not me and not Musk who cries childishly "not fair!" when things are not as you like, as you can easily witness, and others are reluctant to finance your wants.
Your surprise that somebody can object to untruth where it's not personally beneficial to him tells yet more about your approach to fairness.
The individual wants his class to be taxed. Telling the individual they can simply pay more does nothing for everyone else in the class. Your reply is unserious.
Not only do I want everyone in my "class" to contribute more to society, everyone significantly above me should be contributing a larger share. This is the basis of progressive taxation.
You're equating giving money to the government with contributing to society, which is not the same thing. Politicians will give your money to any cause that will get them reelected, be that vanity projects or cronies that contribute to their campaigns. That's not even the worst case, they can spend it on the military killing people, spying on the populace including you, or distributing it in some other unjust way.
If you want to actually contribute to society you are better off investing it in some productive way or giving away to people in need as directly as possible. Government is a necessary evil, don't give it a dime more than what's absolutely needed as it can get out of control with little room to escape.
If we're just airing what we think about taxation, I think people with low incomes should pay more than they do currently in taxes, so that everyone feels like they have skin in the game. People generally don't take as much care of something that was dropped in their laps as something that they had to work hard for.
Currently, over half of all federal personal income tax collected is paid by under 5% of taxpayers, and the bottom 50% of income earners as a whole pay under 3% of all federal income tax collected.
According to this source[0], the bottom 50% of income earners who paid 2.32% of all federal personal income taxes collected in 2020 comprised 10.18% of the share of income. So yes, it is more.
Begging for a tax increase as a proxy for societal contribution is something else.
I work 60 hours a week and volunteer for 20 more.
Not only do I want everyone in my "class" to contribute at least as much as I do, I want them to actually contribute something, not just voidposting about how they have too much money and wish the government would take more of it.
While true and a fair rebuttal to all higher tax suggestions, increased tax on people like OP would have a much larger effect than just them giving a bit more away.
I'll make you a deal in which both of us come ahead - pay my taxes for this year. I'll even go for federal only. If you're in, I can accept venmo, cash, btc or anything commonly accepted. Think about it - you get less money, as you wanted, the money go to the taxman, as you wanted, and I get a little bit for helping you.
Unless, of course, you, as usual, meant that it's me that is going to be taxed more? While you are already getting paid from my money?
Another way would be to ask for pay reduction. Same effect on the public money, much less friction and transactional expenses. I'm sure your boss can find a way to make it happen.
These arguments nearly always come back to the fundamental desire (greed) for "Giev moniez pl0x.", as you say the limit is above their own wealth as to not be an inconvenience to themselves while siphoning monies from those around (and presumably above) them.
It would make for better discussion if these social justice warriors were at least honest about what they actually want.
How many people here aren't making 6 figures? I'd wager a slim minority. And I'll bet that some who show up here are making 7 figures. Did you think you were replying on reddit or twitter or something?
If you look at the job threads on HN you'll see a huge number of Europeans (and otherwise non-US persons), many of whom likely make less than $100k+. This isn't 2015, HN has quite a broad non-SV audience now.
The grandparent comment argues for "businesses [which] are democratic institutions" and a "hard cap" on wealth which will presumably be taken and distributed to people with less wealth, for the goal of "do[ing] substantial good".
Ergo, arguing justice (FSVO justice) for society.
As such, I am of the position that this is one of those rare situations where the term "social justice warrior" is meaningful and accurate.
I agree it’s accurate, but you said “these social justice warriors,” which made me figure you were doing more than referring to the author. It seems like the goal of invoking the term was to aid in your dismissal of the author’s positions by linking them to a derided stereotype of activists. If I’m wrong then I apologize.
If you think about it, Social Justice is objectively a good thing. Being "Woke" means to be aware the United States is a white supremacist society. These terms are used as if they were Ad Hominems, but they're kind of the opposite.
The people complaining about these things are literally self-identifying themselves as the bad guy. We're not making you use these words. We're not making you self-identify as the bad guy. We didn't put the rake there, but they're proudly stomping on it anyways.
Social justice isn't good because you have as many social justices as there are individuals.
Take for example the aforementioned grandparent: It's justice to redistribute wealth from those above some arbitrary line to those below (grandparent is presumably below it). That's only justice for him, it's bullshit to everyone else.
And you know what happens when differing senses of justice collide? Possibly made worse by fervor? Very Unpleasant Things(tm).
This is why we use legal justice rather than social justice: There is one and only one standard of justice that we all agree to accept after much deliberation.
I have to laugh when $15M is considered enough wealth to "live a middle class lifestyle." I live in flyover country in a city of two million where the average household income is $60K. A 4% investment return on $15M would keep ten ordinary middle-class households afloat in my neighborhood forever without anyone ever having to work again (and without ever having to touch the investment principal). It's easy to lose track of what an immense amount of money $15M is.
The problem is some places are more desirable than others. Penthouses, even if they're not big, they are, for most people, more desirable than the bottom floor. They have a view. They're away from noise. They're often away from rats, roaches, ants which start at the bottom.
Similarly any place on the side of a hill, a cliff, a beach, ... You're unlikely to ban such places (all buildings 1 story?) Even if you managed that they're the house on the quiet street and the loud house next to the highway/trainline/airport
You could try to make such places merit based but that only turns into a different kind of bribe and cronyism. Money is at least, somewhat obtainable by anyone. Plenty of people were not rich and became rich, maybe by luck, but at least it's a higher rate of churn than central authority has ever been.
Personally I find private land ownership a kind of ridiculous concept. Our current system provides the convenient and necessary fiction of land ownership but ultimately to the extent there is an owner, it is always the state.
Are you alluding to real estate taxes, or something else? I know that you have to pay property tax to keep your land, but you have to pay property tax to keep your car, and I don't see how that means that the state owns your car.
I think the current system, and specifically the Supreme Court under Roberts has done an excellent job protecting individual property rights from the state. The Roberts court gets criticized for protecting those rights too much.
I pay property tax to keep my car. I get a yearly bill based on the value of my car, and I pay taxes based on that. I pay property tax to keep my house. I get a yearly bill based on the value of my house and I pay taxes based on that.
The car/house comparison makes sense here because I get a bill in the mail for property tax on my house and I get a bill in the mail for property tax on my car, they are from the same locality in two different envelopes.
I own the land. I own the car, I get property tax bills for both of them in the mail every year, they are precisely 100% the exact same.
> I pay property tax to keep my car. I get a yearly bill based on the value of my car, and I pay taxes based on that. I pay property tax to keep my house. I get a yearly bill based on the value of my house and I pay taxes based on that.
In the US? This isn't common. I've heard of things like this to register your car but not to keep it.
There's no laws in the USA where they'll repossess your car if you don't pay registration fees. They just don't allow it to be on the road legally and you'll get ticketed.
I own vehicles in CA. There is no property tax for vehicles in CA. I can guarantee you that. I specifically own vehicles that I don’t renew with the state and there’s no problems with that.
I don't pay anything, man. That's my point. I don't have to as long as I don't put them on public roads. You can race them on the track or do whatever you want with them.
But why? If someone is creating millions of dollars worth of goods or services what moral justification is there for it to be confiscated, particularly at your arbitrary level?
> If someone is creating millions of dollars worth of goods or services what moral justification is there for it to be confiscated, particularly at your arbitrary level?
I think there are good "system stability" arguments to set limits. Roughly, states are dynamic multivariate systems whose objective function should ideally track citizen well being and state security, and taxes are one of the feedback loops that prevent individual actors from dominating or otherwise destabilizing the system.
The mistake is thinking that the fictions we created to establish this system are fundamental moral imperatives in and of themselves.
Because, someone doesn't just create millions of dollars of value, teams of people do. And in the current system someone does get to choose where to cut the "sandwich" and they get to choose which side they take. And with negligible repercussion, they choose the largest portion.
It's basically incentive to steal.
It's basically taking credit for someone else's work. But it's taking their share of wealth.
“ if some minerals are discovered on your heretofore low value land”
And
“ creating millions of dollars worth of goods or services”
Where was the act of creation that led to the increase of the value?
How did the land to acquire become yours?
Most likely you didn’t discover the land, or do anything to find the materials (hiring people to do labor) so there’s no reason to think you should receive anything
It incentivizes people to find minerals that are valuable to the public. You can construct a hypothetical where someone gets lucky, and you can construct one where someone has reason to suspect the minerals are there and invests in the land.
> You can construct a hypothetical where someone gets lucky, and you can construct one where someone has reason to suspect the minerals are there and invests in the land.
You don't even need to construct the scenario where someone with enough capital just buys up as much as possible, knowing they will get lucky with some subset of their property. That's both a modern problem and the plot of Blazing Saddles (yes, I'm choosing that example to focus on how widespread of an issue this has been for centuries).
> Where was the act of creation that led to the increase of the value?
I'm not sure what you mean. Finding and extracting the asset adds a valuable, productive good to the economy (ignoring the enormous downside).
Are you debating the word choice, "creating"? I guess I don't see that discussion as valuable. Are you using the word choice to make a point? Make it!
> How did the land to acquire become yours?
You know how; again, please make your point?
> Most likely you didn’t discover the land, or do anything to find the materials (hiring people to do labor) so there’s no reason to think you should receive anything
Is all of this an argument for communism - the only ones who do anything valuable are the workers? I think that's as self-serving and narrow-minded as the ultra-capitalists who think only they matter. Providing and allocating capital is essential and a valuable skill; if it's easy for you, I'm sure you have plenty of it by now.
>the only ones who do anything valuable are the workers?
Correct! Because the act of creation is where value is created.
By definition capital does not create value, otherwise there would be no requirement to have labor to do the “transformation.”
Exactly to your point I have at points had quite a bit of money (not currently true). But it’s not from “capital growth” it’s from aggressively selling my labor and capturing the majority of my labor value. That said, if you were to compare the amount of value, I’ve created to the amount of money I received, It’s not even fucking close I’ve created 1000x more value than I have captured.
Why? because at the time that I did those deals, I was not in a powerful enough position to demand the value capture, because we’re stuck in a state where the vast majority of people need to debase themselves simply to survive.
Is that the type of system that has long term capacity for multigenerational equitable success? The answer is no and there’s no way you can slice that that makes it a yes.
If, however, your goal is a infinite race to the bottom for worker self exploitation, where people will literally destroy themselves in order to otherwise survive, based on the whims of hoarded capital owners arbitrary self inflated egos about how the world works. Having been a LP in a venture fund, a Director in a large public company, and a multitime start up founder I can guarantee this is exactly how it works. If that’s the world you want then we’re right on track.
Well, I wouldn't go nearly as far as you do, but I do appreciate your up front, clear argument for your point.
My perception is that the labor/capital allocation of return is far out of whack, due to a power imbalance.
But I feel you still aren't accounting for the value of capital. It's too easy an answer, intellectually, just to dismiss the whole thing and ignore the complication.
Production requires capital and labor. If I lend you my truck for your contracting service, shouldn't I get some return on that? What if you use my property to manufacture your skateboard (or whatever)? What if I give you some of my personal cash to hire workers, who then produce the skateboards, which you sell at a profit? I know these are simple, chosen examples, but where do you see the problem and how do you quantify appropriate returns?
Even if you claim to have thought really really hard about when to open the vault, the simple act of hoarding less, does not transform the goods into value.
The fact of hoarding, crowds out others use of the resource (reducing monetary velocity) so that means for people who want to make more, the choices made for when to open the vault are solely dependent on an mathematically unequitable distribution of the resultant created goods, in effect stealing directly from the people making value.
To be clear I’m not making the Labor Theory of Value argument - I’m simply demonstrating that by capitals own standard (increase in value based on capital labor mix) capital should get no excess return.
In fact the only argument capitialists have left is the contract and this is the Mises style MaximumCapitalist like Hans Hoppe. The argument goes that as long as a contract is signed, there cannot be anything unethical.
If we simplify away the personal issue of 'that's my truck; you'll have to pay me to use it' - we forget property rights and the psychological attachment to property, which I don't think is realistic or wise. (Also, I've recently been reading about 'cultural universals' - behaviors in all/most/many unrelated cultures through time and geography that are not biologically determined (as far as we know) - and property is one of them.)
I'm sure you know the next issue: How in your system is capital efficiently allocated? The issue is not hoarding (or not necessarily), it's natural scarcity of capital. How do we decide who gets to use the truck or the property, etc.? We know the capitalist method of allocation, which is rather productive in aggregate. Other methods have been unproductive, broadly speaking. First come first serve?
Also, the worker in your system gets all the return. Great. Now they have some money and they buy a truck. But now they own capital, the truck and hopefully some cash left over. Must they lend it to someone else without return? I dunno, but they might not be happy with that!
(You can ignore the fact that it's on a Marxist site - Proudhon and Marx were not friends and had bitter disagreements - but unfortunately and unsurprisingly Marx's "Communism" got popular)
Plenty of groups through history and even today ban interest as usury - the early Islamists were known for this
On efficiency: Note your arguments. The conceit of a capitalist apologist are that the mechanisms of capitalism, (eg markets as a price clearing mechanism between free agents) according to the efficient market hypothesis should not require a central or other intermediary for allocation. Yet your entire claim is that the purpose of finance is to make that clearing happen efficiently, and to be significantly compensated for such.
How is that not centralized planning only by a different group, then a government? From an information and planning perspective it’s not, so any claims that you need a financial services market in order to make capitalism efficient, argues against the foundational argument of the efficiency of capitalism.
Syndicalism, however, does not require any intermediary, and in fact, any intermediary introduces net losses as I’ve already demonstrated, there is no value created by capital allocation, and therefore the only value if it is taken out of, it comes out of those the value that could be captured by the person creating it.
Finally I’d suggest you read my paper and see what you think:
Thank you! I may not agree, but I learned a lot about your position.
You may be interested:
In the study of cultural universals, there are four leading anthropologists going back ~100 years afaik, and all four say private property is universal, based on the evidence. Some caveats: Generally speaking, they say it; there's detail there that I don't have time to look into now. Also, defining and classifying the behaviors of all cultures, current and past, and associating them with some modern English words, yields uncertain definitions - as those anthropologists will tell you. Certainly how a 'cultural universal' is expressed can look very different in different cultures.
* Clark Wissler, Man and Culture (1923)
* George Murdock, "The Common Denominator of Cultures", in The Science of Man in the World Crisis ed Ralph Linton. New York: Columbia University Press. 123-142. (1945)
* Charles Francis Hockett, Man's Place in Nature, McGraw-Hill (1973)
* Donald E. Brown, Human Universals (1991)
These are seminal works in that field - the seminal works as I understand it (I'm not an expert). You can find all/most at the Internet Archive, as far as I know.
The goal wouldn't be confiscation. It would be to incentivize behavior to avoid confiscation. Charge less rent to mine minerals. Spread equity in business more broadly.
How does that encourage more R&D and higher salaries? Or rather can you show an example of a country with high corporate taxes and higher relative wages and R&D spending? I’m not aware of one.
Yes I think so. I’m not the original commenter, but I’ve also landed on the idea of limiting wealth to the ballpark of $10-15 million, primarily using progressive taxation. The point is to prevent any one person or small group of people from accruing too much power within our democratic society or reaching levels where they stop using their wealth to contribute to the economy (by e.g. offshoring money).
It's all well and good to take away from the rich, but where does that tax money, once taken away, end up? You're saying it should be redistributed to those making less money, but what's stopping politicians from enriching themselves with that money?
> reaching levels where they stop using their wealth to contribute to the economy (by e.g. offshoring money)
Money in Cayman Islands numbered accounts generally only happens with illegally gained money (maybe by the likes of politicians I've described above), or by people in jurisdictions with harsh capital controls (like the sort you're describing). People like Bezos or Gates aren't stashing their money away like that. Most of the ultra-rich of America derive their net worth figures from ownership of publicly-traded companies.
Almost anyone that's making substantial money off of land is already paying property tax on it, as well as any income tax that applies. Now, the income and the property taxes they're paying are in many cases woefully inadequate, but I'm pretty sure the solution to that is to improve the tax system and patch the loopholes, not to add a separate additional tax for everyone to keep track of.
This wouldn't be a separate additional tax; the vast majority of LVT proponents (myself included) propose it to replace property/sales/income taxes (all of which are just economically-inefficient taxes on land anyway: http://www.wealthandwant.com/themes/ATCOR.html).
As for loopholes, LVT is the most effective way to patch them; you can't exactly move land to offshore bank accounts, after all.
I think it’s not a coincidence that land value tax is popular on Hacker News. Replacing all the taxes that tech companies currently pay with a land value tax that hardly affects them would be an incredible boon.
Their servers exist somewhere, and while it's called The Cloud™, that ain't literal ;)
Datacenters, offices, warehouses, factories... these all sit on top of land. Even a fully-remote company running off Raspberry Pis in someone's closet still requires some quantity of land on which the employees' homes and that closet full of Raspberry Pis sit. Even if the companies themselves don't own that land directly, somebody does.
> I've thought for years that we should place at hard cap on wealth somewhere around $10 or $15 million.
Where's the empirical evidence that such a cutoff benefits society as a whole?
> I've argued we should combine this with a move towards a worker owned economy - in which businesses are democratic institutions governed by the people who do the work involved.
I like the German system of giving labor a board seat. We should try that first before burning our entire economic model to the ground and starting over, based on a gut feeling with no hard evidence to support it.
There’s decent evidence (backing up clear intuition) that wellbeing scales with the log of income. There’s also decent evidence for losses being about twice as painful as gains are pleasurable. Moving money from richer to poorer people should therefore increase average wellbeing as long as the richer people are sufficiently richer, or as long you can make the loss feel like a foregone gain instead.
That's true. Although when embarking on a brand new frontier without any empirical evidence available, one would assume there's ample theoretical evidence to make up for it. In this case both appear to be lacking.
However when the power is held by people who would potentially face significant financial loss from either theoretical or empirical evidence, it shouldn't be a surprise that such evidence is lacking, no?
> Because that's the point at which you have enough wealth to live a comfortably middle class lifestyle for the rest of your life
15M is far from middle class by any measure. 15M affords you a big city place, a place for winter holidays, and a place for summer holidays. With still left to have spoiled little kids (and possibly spoiled grand children).
Also, 15M is not static money. If you have that much money you will certainly gain an income from just having that much money.
Yeah, my family lives very comfortably in the US, all things considered ("upper middle class"??), but still far from having $15 million in total wealth.
> I've argued we should combine this with a move towards a worker owned economy
While I'm sympathetic to this ideal, I don't think it works. All you'd do is add all the inefficiencies of politics into business-level decision making. Democratic processes should be reserved for governing shared resources, like water and air, where independent decision making has pathologies, and independent hierarchical systems are good for optimizing efficiency and value for all other goods and services. We just have to ensure there's competition and fairness for good outcomes.
> All you'd do is add all the inefficiencies of politics into business-level decision making.
While I'm sympathetic to that line of thought, I feel like it ignores the reality that most business-level decision making is already inefficient and political. Where is the competition and fairness when a sustainable business is bought out, prices increased and development halted to wring out every bit of value, and then sold off for parts to competitors when no profit is left? There are so many common business practices that are actively hollowing out the free market.
> While I'm sympathetic to that line of thought, I feel like it ignores the reality that most business-level decision making is already inefficient and political.
Far less than it would be under the proposed system. There's effectively a dictator after all.
> Where is the competition and fairness when a sustainable business is bought out, prices increased and development halted to wring out every bit of value, and then sold off for parts to competitors when no profit is left?
I never said it didn't have pathologies of its own, which is why I said that we have to ensure there's competition and fairness. Arguably, anti-competitive laws have not been properly enforced for quite some time.
> run by a democratic system where the voters are shareholders
The more shares you hold, the greater your voice, when it comes to corporate governance. It's not at all the same as the typical idea of democracy as "one person, one vote".
Would you rather corporate governance be more like a political democracy, where no matter if someone has 30% of the shares or 0.0001%, they get the same vote? Or, perhaps the other way around, you'd like to change a political democracy to:
> limiting who allowed to own shares to people work are directly involved
where suffrage is limited to people who work and contribute to society?
> The more shares you hold, the greater your voice, when it comes to corporate governance. It's not at all the same as the typical idea of democracy as "one person, one vote".
"One person, one vote" is not how the presidency works in the USA.
Beyond that, you seem to trying setup some strawman positions rather than engaging in a discussion about anything anyone actually said.
>> I've thought for years that we should place at hard cap on wealth somewhere around $10 or $15 million
Do you think your standard of living under such a system would be lower, the same, or higher than it is now?
I think it would be much lower. I think most people will stop working when they stop getting paid. Some I guess would spend money as fast as they make it on experiences and services and other things that don't increase wealth. But I think many people who would in the current system have gone on to create billions in wealth would stop at $10 million and say, "OK I hit the number, moving on to the next challenge".
> Do you think your standard of living under such a system would be lower, the same, or higher than it is now?
that would probably depend on whether you're being exploited by the current system
Imagine looking at a group of slave owners and slaves and asking a similar question with regards to ending slavery, and being all like "well let's hear both sides".
There's people participating in that economy benefiting from people in other countries being exploited in order for those participants to get cheap products.
Even if that's true, I think a lot of people have a long way to go before reaching $10 million in wealth, and there always would be, so it's not like there are just a few "chosen ones" who could do so much more if they were motivated to earn $1 billion, and society will suffer otherwise.
Some things cost way more than 10 or 15 million in terms of investment.
Why shouldn't a billionaire be capable of starting a genetics lab to fund cancer research and pay for it in cash, if they are so inclined?
Also almost all of super wealthy people's "wealth" is tied up in assets that are funding entire economies. This money is creating jobs, allowing for affordable loans, the money is working for many other people... It's not as if the money wealthy people have is just in physical gold coins in their swimming pools.
>Why shouldn't a billionaire be capable of starting a genetics lab to fund cancer research and pay for it in cash, if they are so inclined?
Starting land to fund cancer research is fine, but I don't see why we need billionairs for that? Multiple people can fund it. They are going to work alone in that lab either.
>It's not as if the money wealthy people have is just in physical gold coins in their swimming pools.
And it's not as if taxing that wealth makes that fact go away.
What's different is that when all that wealth is concentrated with a few people, they get to decide what research they spend it on and which jobs are created. And that's a bad thing, it's a threath to democracy.
Needing more people for funding just adds friction to an already hard problem and will reduce the number of such things that get started.
I fundamentally agree with your arguments, but not your conclusion.
IMO we need a greater number of rich folks and fewer ultra rich ones. Those with over 100 billion dollars simply cannot spend it, which means capital is not being allocated at all! Bill Gates has so many employees just dedicated to spending his money responsibly, and he still keeps getting richer.
>Needing more people for funding just adds friction to an already hard problem and will reduce the number of such things that get started.
Because governments can't fund projects?
Not sure what you are arguing for, but IMO there is this idea of the "great men" who build cool things like Space-X. So we should let the wealthy keep their great wealth so that we get more companies like Space-X.
Except what we really get is more corporate looting, oppression and monopoly, plus the hyper-wealthy having excessive influence over government.
If the wealth is spread around, and we no longer have to be wage slaves our whole lives, then collectives of like-minded people could band together and build cool things. We do see that in the open-source world, but most contributors are not earning money they need to pay bills.
I very specifically said that the government should fund projects and personally I think it should fund more. But they can't do everything and they won't always have the foresight to fund everything worth funding.
I am arguing that more-or-less randomly allocating wealth to individuals to then re-allocate will produce better results and the larger number of individuals, above a certain amount of wealth necessary for grand projects, the better. I think we are better off when we have a diversity of directions in funding grand projects. There is a very real cap on how much money is actually necessary for great projects. No one needs 100 billion dollars to do any particular thing. Idk where the line is, probably the high hundred millions or low billions?
We also really need better wealth distribution in the middle too, but the main post's assertion is literally "no rich people" so I'm arguing against that because private investment has created an incredible amount of the good things we enjoy every day. I'm not talking about the "great men" I'm talking about boring people writing checks for new companies that they think sound cool.
> Why shouldn't a billionaire be capable of starting a genetics lab to fund cancer research and pay for it in cash, if they are so inclined?
Well, why should they? What if instead of a genetics lab, they want to start a flat earth research center? Or a think tank to influence policy in their favor?
> Why shouldn't a billionaire be capable of starting a genetics lab to fund cancer research and pay for it in cash, if they are so inclined?
The answer might be "they should be able to"
But are you open to the possibility of the answer being "Despite the apparent potential benefits, it isn't beneficial overall to society or humanity to have extremely rich individuals starting research projects, and perhaps not beneficial overall to even have extremely rich individuals at all" ?
This hypothesis presupposes the "manna from heaven" concept of wealth, which isn't how it works. Wealth is what people want[0]. There isn't a real limit to what people want, so there's no real limit to what wealth can be created, either.
Even on a deserted with five people, there isn't a fixed amount of wealth that can be divided over those five people. A fixed amount of land? Sure. Maybe a fixed amount of rocks and trees? Okay. But there's no fixed amount of the ingenuity and labor that is required to convert those natural resources into things actually desired by people, like a roof over one's head or warmth during a cold night.
And some people are more industrious and clever than others and therefore are better at meeting people's needs and being compensated for it.
> are you open to the possibility of the answer being "Despite the apparent potential benefits, it isn't beneficial overall to society or humanity to have extremely rich individuals starting research projects, and perhaps not beneficial overall to even have extremely rich individuals at all" ?
That seems to me to say "maybe no one should be rich enough to fund a major project on their own".
I'm not arguing against a limitation on wealth, I'm actually in favor of one, because like you point out then there would be a less extreme distribution of wealth. I'm saying that if such a limit were to be imposed that it should be high enough to allow significant projects to be started by an individual. That limit is still probably really low compared to the high valuations some billionaires have today.
I do see a fair reasoning in not allowing the possibility for a lone mad man to start a big project without needing to like, check up with other people on whether what he's doing is right.
In regards to fame, Adam Savage recently said:
"When there’s no one around you that can tell you ‘no,’ you’re in deep trouble, and you’re also going to traumatize the people around you.”
> perhaps not beneficial overall to even have extremely rich individuals at all
To mean there would be fewer. I suppose it depends on where the "extremely rich" line is drawn, but I feel like you must be extremely rich to start a project that normally only a government could start.
Why do only the resource allocations of rich people count as the decisions about resource allocation? What about the decisions made by non-rich people?
As the bumper sticker says, it seems easier for most people today to imagine the end of the world than to imagine an alternative to corporate capitalism.
I said why, because for capital intensive processes it's unrealistic to expect large groups of individuals to raise enough money to start them.
We do have Kickstarter, Go Fund Me, etc, but I don't think those have turned out to be great tools for raising a very large amount of money. And I am referring to large capital allocations towards a goal. I wish there was a better version of Kickstarter, but VCs seem like a better tool.
I'm just talking about capitalism and what ideal wealth distributions look like under a fundamentally capitalist system. I think America's system has lots of points for improvement, particularly on the side of worker protection from exploitation, wealth distribution, and campaign finance. But, I still think that we should have individuals wealthy enough to fund weird projects just because they want to. And in fact we should have more than we have today just with less extreme wealth.
What is it exactly that you are saying we should change? Everything? Please be specific.
That's terrible. Suppose you want to go some amount of social good that will cost you $15M. Let's say. Develop a new drug. Maybe you want to do something crazy, like don't patent it. It's clearly great for society. But nobody will give you money to do that. Your only recourse to do it is to amass wealth yourself and fund it personally.
Now you have a created a society where that sort of social entrepreneurism is impossible.
If this good were “clearly” great for society, they wouldn’t have trouble forming a conglomerate towards achieving it. We can use the wealth that isn’t sponged up and locked away at the bottom of the sea for such initiatives.
Society has had enough of ostensibly singular “great persons” inflicting their idea of the greater good on the rest of us in exchange for love, respect, and money. The rest of us have to earn those three.
> they wouldn’t have trouble forming a conglomerate towards achieving it.
That's underpants-gnomes level bullshit and you know it. Especially since I've given a concrete example that doesn't exist and would be AWESOME for society
> a worker owned economy - in which businesses are democratic institutions governed by the people who do the work involved
A few notes... another way to make the economy more worker owned is to have a a portion of the shares of companies held by public entities, which then use dividends for a basic income. Public investment in companies like this could also be a way of incubating industries.
Another note: the biggest problem with businesses being democratic institutions is the pace at which decisions can be collectively made. This is an information systems problem that can be solved by software. Instead of voting for representatives who make decisions, we need an institutional programming language, and people can vote directly on implementations of modifications to this institutional code that defines every institution. Votes are essentially approvals to a PR. No need for intermediaries to misinterpret voters' intentions.
I don't have a problem with someone being a billionaire per se. Assuming, of course, the wealth was earned without worker exploitation.
However, I do take strong offense to politico-economic systems where the billionaire has more political power than a poor person. In the current system in almost every country, both individual super rich people and collectively the top 1-5% have enormously more political power than the remaining people. The system much be changed.
It seems likely that the only way to become a billionaire is through worker exploitation, collusion, cheating the system through tax evation and asset laundering, etc.
I think politico-economic interference is the crux of the problem.
For example, someone with $10 million are trying to maintain their lifestyle, they want to know what stocks, bonds, and certificates, and real estate to invest in.
Someone with $100 million are trying to leverage through venture capital, joining corporate boards, owning platforms, etc.
Someone with $1+ billion will find that the most cost effective way to keep and gain wealth is buying lobbyists, campaign donations, starting and controlling some non-profits that have tax and spending incentives, getting favors by giving politician's kids high profile jobs, and any other innumberable political grift that maintain their wealth status and that only really work at that scale.
I wouldn't care if billionaires were just hoarding some money. But they are not, and all this while they pay bad wages and have even shoved off the cost of training for their jobs onto society and the labor force who have to speculate and pay for their own training.
> It seems likely that the only way to become a billionaire is through worker exploitation, collusion, cheating the system through tax evation and asset laundering, etc.
What workers did J.K. Rowling exploit to become a billionaire? Did Stephen King only cheat half as much to arrive at his half-billion net worth? They produced something that people wanted to buy that previously did not exist, and everyone in the chain got paid what they were willing to work for.
In what world does it "seem likely" that you can only become a billionaire through illicit means?
JK Rowling exploiting workers is a straw man and sidesteps the point.
To some people what I wrote will be a truism and to others it will beg the question.
I see what side that fell on for you and that's good, I'm not citing anything, so definitely question my reasoning. But don't think for a second that producing a handful of books people ended up wanting can generate that amount of value.
In the case of Rowling, she was also executive producer of several Harry Potter films and was no doubt a benificiary of motion picture accounting to a greater or lesser degree. She controls charities and who knows how many shell companies and trusts to hide and manipulate wealth. That's what you have access to at that scale of rich.
Furthermore, if she wasn't cooking the books, hiding and differentiating wealth for tax benefit, placing herself in position to extract more wealth, then she would be the stupid one among her rich peer group and would quickly find herself like one of those lottery winners who are back to being poor and none the wiser 5 years later.
Another truism is that it sounds fun to be rich, but it probably isn't very.
Another truism is that I'm sure we'd all rather suffer being rich than be poor.
It doesn't sidestep the point, it shows the value of your truism, particularly in a 21st century globalized, internet-scale economy.
Who's being exploited if I upload a song (or ringtone, or wallpaper) to an app store for $0.99 and it gets millions - perhaps even billions - of downloads?
(Answer: me, because of the app stores' rapacious policies)
I've argued we should combine this with a move towards a worker owned economy - in which businesses are democratic institutions governed by the people who do the work involved.
Let folks keep their wine and art collections. Limits need to be placed on ownership of productive assets.
Employee, consumer, or even municipal ownership of firms would be a natural consequence of such a limit. No other way to offload assets fast enough, especially since the usual sources of capital would be under the same limits.
Any solutions that are in conflict with human nature will never be successful. Ambition and envy are basic human traits. At a deeper level, we are beings that measure everything (including light, sound, smell, touch and taste) by way of comparison.
Communism fails because no one has anything left to aspire to and everyone is therefore equally miserable.
So in short, neither you nor I know what human nature is, and thus setting up criteria for social organization on whether it aligns with "human nature" is impossible, and a foolish goal.
There is a sort of sleight of hand being performed here. Communism is being blamed for the consequences it has on its own country.
Capitalism on the other hand, you can look at and say "look how well it works for this country", because meanwhile it is doing terrible things to other countries.
Communism fails because giving everyone a voice in central planning can't scale up to an economy of millions of people. It requires a degree of central planning that permits too much corruption. The only known vaccine against corruption is high civic engagement. Every society has a given level of civic engagement; and thus a given maximum level of central planning before corruption becomes intolerable. No known large society has a high enough level of civic engagement to support the amount of central planning required by communism.
Communism works just fine for small groups (<10), and passably up to a few hundred (e.g. kibbutzim). Your argument would apply equally well at those scales, but mine doesn't. Full disclosure -- there are other arguments that contradict mine while still differentiating these cases.
Of course it doesn't super matter, because this proposal (though not a great idea) isn't communism and communism reliably fails anyway at the scales most people mean.
So are compassion and generosity. And contradiction.
The role of systems in society should be to oil the pathways for the better parts of human nature to come forth, and make the other traits less convenient.
As someone who has worked extremely hard to acquire assets great than 15 million, who do you suggest has the authority to come and take some of it away from me. And what will they do with the resources they confiscate?
When one makes an agreement that if I set certain goals, and I achieve said goals, I will be compensated a certain amount.
If I choose to buy land, goods, services, the seller chooses the "value". If I agree on the value, I have free will to to purchase the land, goods or service. If I do not agree on the value, I can either offer a lower price, or walk away.
If I purchase said land, goods or service, and later decide that I no longer want those things, I can choose to sell them. At that point, I set a value. If the purchaser agrees on the value, I then sell/transfer ownership to that person. If the value has grown since I purchased said land, goods, service, I could potentially profit. If the value has not increased, I am at a loss.
So, to directly answer your question about "authority". (In my case, land that was owned, and worked, for 100 years in an area that no one wanted to live). A price for said land was agreed upon. The sale was advantageous for the seller as he no longer wanted to tend it. I assumed the risk, taxes, etc. Working said land was extremely arduous. Shepherding it through multiple hurricanes, floods, etc bore a financial burden. Many years later, as the area began to develop, my asset grew in value. Selling it produced a profit. This profit allowed me more ability to purchase other land, goods and services.
As I'm tying this, I'm certain you're aware of these basic economic principles, but simply don't agree with them. Disagreement is fine. But this is the way things are done in my country. And, I choose to live here because I agree with those principles. If I wanted to live in a country where an entity could come and confiscate my wealth, and redistribute it, those countries exist. I could likely move to one of them.
> I suspect it is not someone that came and gave it for free.
I suspect that whatever price was charged was a bargain compared to what it's actually worth - and thus the transfer was at the expense of the rest of society.
> And if it was a gift, it would still be a property transfer. So still his.
And if that "gift" was stolen from someone else beforehand?
> And if that "gift" was stolen from someone else beforehand?
Then that would be theft and not legitimate property transfer. I was talking about cases where a gift is from someone who earned it and transferred something, a donation.
Not from a government that gifts via regulations or a thief that steals something and donates after the fact. Though there is no difference in either IMHO.
How about from a government that conquers land and sells it to profiteers on the cheap (who then rent it out and/or resell it for considerable profit)?
How about from a government that - instead of taxing that aforementioned conquered land and the ownership thereof - shifts the tax burden onto the working class (via income and sales taxes), robbing us blind while subsidizing the owning class (who is then happy to rob the working class further via skyrocketing rents)?
The vast majority of people "earning" tens of millions of dollars in this country are not doing so via their own hard work. They are doing so by rentseeking - by being parasites on local, national, and global economies. Their wealth derives from theft, plain and simple.
I am against taxes in general. For a tax to exist, there must be a justification. And even after that, I doubt it is fully legitimate: what if someone does not want or use the public schools system or health system? It must pay for it?
So yes, a government that taxes people against their will for a service they do not use, from my perspective, is theft to tax payers.
A different story is wether we want to support to some extent people who need it: in that case, it would not be theft against a person giving support, but it would not be a tax either.
As for who earns and how, yes, crony capitalism is quite bad. What I support is mostly free market capitalism as much as it is feasible and realistic.
I am not sure it is ideal, but as long as laws for damage are applied and the consumer is informed, it works way better than all this political cloud full of a system with favors, licenses, and excuses to avoid comptetition.
I am even more against subsidizing than taxes themselves. That is the worst possible distortion of things.
I am hopeful there are other ways, and I would like to put them in practice.
But those come from our own beliefs.
The land conquering is a difficult topic. I agree it is not a good thing. But the history of humanity is the history of conquer. A person that violently takes territoy in some way should not be the owner. I am not sure it is practical or even possible to fix that, though.
> So yes, a government that taxes people against their will for a service they do not use, from my perspective, is theft to tax payers.
Fortunately, that ain't the case for a land value tax as alluded to above. The government provides landowners a service (enforcement of their land deeds), and any "tax" on it is a payment for that service. As it stands, landowners have successfully lobbied the government such that they only pay a tiny fraction (at most) of the rents due to society at large. And so:
> For a tax to exist, there must be a justification.
And there you have the justification. Landowners owe the full value of the land they own to the society willing to respect and enforce that ownership. Anything short of that full value is theft, and is indeed rather directly responsible for the continued prevalence of socioeconomic inequality both here in the US and worldwide.
I do agree with you that how that tax revenue gets spent is an issue. The maximally fair answer would be to disburse it equally to all citizens as a dividend, and then citizens can put that money toward the things they believe to be worthwhile.
And on that note:
> A person that violently takes territoy in some way should not be the owner. I am not sure it is practical or even possible to fix that, though.
LVT happens to be a maximally fair and practical way to fix that, especially when paired with a citizens' dividend per above; assuming, per above, that land ownership and socioeconomic inequality are causally linked, shifting the tax base away from the products of labor (i.e. abolishing taxes on income, sales, and buildings) and onto land values would satisfy the goals of things like reparations, such that those who materially benefited from such conquest are the ones compensating those who did not.
I would need careful analysis of your explanation before having an opinion since I admit to not have read, thought or known about this very concrete topic, feasibility, etc. in depth.
1. Some government establishes (or expands) its sovereign territory through violent conquest.
2. Private parties obtain a service from said government and the society it ostensibly represents without paying in full for it (specifically: the issuance, recognition, and enforcement of land titles/boundaries, those being definitionally subsets of said government's sovereign territory - which, again, may or may not have been obtained through violent conquest)
Here in the US, both of those sorts of theft are in play:
1. The entirety of US territory was obtained either by conquering it from other entities (e.g. Native American tribes, Mexico, Spain) or by purchasing it from other powers who had previously done so (e.g. France, Spain, Britain, Russia).
2. The US government (or state/local subdivisions thereof) issues and enforces deeds representing subsets of its sovereign territory to landowners, at the exclusion of the rest of its citizenry - yet the landowners do not pay anywhere near the full rental value of the land to said government or said citizenry.
> Am I to assume that every piece of land has an "original owner"? Who is that?
In the case of American land, that'd be the indigenous peoples thereof.
In a more general/legal sense, the "original owner" would be the government of whose sovereign territory that land is a subset. If that government ostensibly represents its citizens, then said "original ownership" would rest with each and every individual citizen equally. As Locke explained in his Second Treatise of Government:
> Nor was this appropriation of any parcel of land, by improving it, any prejudice to any other man, since there was still enough and as good left, and more than the yet unprovided could use. So that, in effect, there was never the less left for others because of his enclosure for himself. For he that leaves as much as another can make use of, does as good as take nothing at all. Nobody could think himself injured by the drinking of another man, though he took a good draught, who had a whole river of the same water left him to quench his thirst. And the case of land and water, where there is enough of both, is perfectly the same.
That is: every member of society is entitled to an equal share (by value) of the land on which that society exists. Those who own more than their equal share of that land value owe compensation to those who own less than their equal share. The lack of said compensation is theft.
Is watching those around you starve/freeze to death due to having $0 (or less!) not a reason to care about whether some people make more than $15M? How many people could that hoarded wealth have housed and clothed and fed?
> Cuba or Venezuela were richer than Spain in the 50s just to give you a couple of examples. And Venezuela has natural resources.
Sorry, I checked GDP per capita charts, and it appears that Cuba was not richer than Spain in 50s. It would be implausible that a small country with little natural resources would become richer than the country that colonized it in so little time.
And Venezuela become poorer than Spain in 1982. So it had no relation with "take everything from the others and give to the poor".
Counterpoint for your argument: outside the west, between non-alignment countries, only places where marxist-leninist revolutions happened produced powers that were able to seriously compete with the west. For example, URSS and China.
I agree wholeheartedly with this concept. I wonder if the most realistic way to do it is to hardcap inheritance. As much as I'm uncomfortable with the power hoarding with the Bezo, Gates, Musks of the worlds, I'm much more uncomfortable with their hundred great grandchildren still being the most powerful group on the planet. An honest meritocracy type should even be able to get behind that. Bezos built something, his kids were just born into it. Cap their total inheritance at $15M and call it a day.
Because if not, people with insatiable appetites will simply seek control of those corporations rather than direct control of piles of money.
Personally I'm an advocate of the exact opposite of what seems to be proposed here: controls on corporate size rather than individual wealth. Living cells don't grow without bounds; at a certain point they get too big and are forced to divide. Simply imposing a tax on corporate size (not a limit) would accomplish this.
Industries where massive size is simply unavoidable (e.g. passenger airplane manufacturing) would simply pay the tax; any economic distortions can be nulled out by reducing the industry's VAT rate in proportion to average size-tax paid by that industry. In all other industries smaller competitors would have the persistent advantage of lower tax costs, allowing them to eventually undermine the bloated colossuses.
Yes, I think you could make the case that entities of any sort — corporations or individuals alike — should be allowed to exceed the threshold only if they’re under some kind of democratic control. And obviously that’s not a get-out that individuals can use.
Will you cap military spending? Beyond the side people take there is some human natural tendency to power that cannot be artificially capped or if it you try to artificially cap it, there is a flow with a lot of pressure that go somewhere else.
My question was just following your "brainstorming". Sorry, I didn't explain myself correctly:
My point is that when you start arguing about capping and/or taxes you should take into account the concept of power, governments, and realpolitik into account. You can put a set of rules for handling corporate power (e.g. taxes) but those corporations could be really smart and move to another jurisdiction such as Ireland (e.g. Google) as a kind of safe heaven. In those cases the whole thinking turns more complex. Gaming the system is part of the game and every rule you put has a loophole except if a government is really strict and/or a dictatorship, and power (e.g. reality) plays there beyond the rules.
This supposes that there's some naturally-right size for a corporation to be
No, in fact, it doesn't. Please re-read the comment you're replying to.
There is no cutoff, limit, or threshhold. It doesn't prescribe a naturally-right size any more than a graduated income tax "prescribes a naturally-right amount of income".
No but you have to pick where and how quickly to ramp the tax schedule which will eventually lead to you having to make some “assumptions” about what size (range) is “too big”
Yes, that is the one and only tuneable variable. It's a single, obvious scalar, like the interest rate set by a central bank. There's no room for favoritism or shenanighans. Of course, like central bank interest rates, it will be an object of impassioned political debate. That's expected.
which will eventually lead to you having to make some “assumptions” about what size (range) is “too big”
Absolutely false. You're confusing a value with its rate of change. The speed limit on the highway doesn't constrain the length of the road.
Yes, in fact, it does. The objection just flies directly into the blindspot which leads you to make the proposal in the first place, which produces cognitive dissonance. You postulate, incorrectly, that "too large" is a coherent concept for corporations, and propose to "fix" your imaginary problem by punishing people who grow corporations larger than your imagined ideal.
I consider it a trivial lemma of the concepts of harm and value, that something which is causing more harm than they are creating value, is producing net negative value.
Although you gave me an opportunity to clarify that, which isn't nothing, I suppose.
Productive wealth is a good thing. It's what made our current society possible. Unproductive wealth is the real devil, the hoarding of inelastic goods like land, gold, and oil.
I strongly prefer a society which permits the existence of Jeff Bezos over one which does not. Of course, more strongly than that, I prefer a society which taxes inelastic goods and negative externalities and returns that wealth to the public over one which does not.
Wealth, at least the way we measure it, is inextricably tied to modernity. The system you say is a "good thing" is literally speedrunning the destruction of our biosphere. I think you'd be hard pressed to find a system more effective at destroying our world. What many see as prosperity, is irreconcilable with sustainability. I find that's an uncomfortable thought.
> Wealth, at least the way we measure it, is inextricably tied to modernity.
Only in the sense that modernity produces a lot more wealth than any other system humans have come up with.
> What many see as prosperity, is irreconcilable with sustainability.
No, it isn't. What might be is allowing people to accumulate wealth by playing zero sum games, siphoning wealth out of other people's pockets into their own, instead of producing more wealth.
Our economies, political systems and culture are all built on the concept of infinite growth. Argue as much as you want, physics makes that impossible in a universe with limited resources.
> Our economies, political systems and culture are all built on the concept of infinite growth
Not really, everything could work exactly the same as now even when growth stops. The current system did bet on growth continuing for 40 more years, but there is no infinite there, other than those bets failing there is nothing in current society that demands infinite growth.
Today's definition of wealth is rooted in resource extraction and energy use. Name me a system that has proven itself more effective at growing this sort of wealth than democracy plus capitalism.
> Today's definition of wealth is rooted in resource extraction and energy use.
That's not true, unless in very basic technical sense - like, we need energy to exist, turn on our computers, etc. But resource extraction and energy production is not the dominating source of wealth for many years now. Look at the current market's magnificent seven: Alphabet (GOOGL; GOOG), Amazon (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), NVIDIA (NVDA), and Tesla (TSLA). Not a single of them does resource extraction or sells energy.
It's not true socially either. If someone wants to get rich, they go into finance, high tech, entertainment maybe. Not in oil prospecting or gold digging (not that there aren't money in it - there are, but it's not what the society considers to be a lucrative business anymore). It's not 1849 now.
Fair enough. Still, I would disagree. Communism was tried and failed, its environmental effects (while bad) were therefore limited. Capitalism has endured great challenges for much longer, and despite increasing discontent with the system in many areas of the world, doesn’t appear likely to go anywhere. If that’s the case, the prodigious output of environmental harm capitalism generates won’t go anywhere either. Green energy and green technology won’t stop all instances of microplastics polluting our rivers or junk toys collecting in landfills.
> Communism was tried and failed, its environmental effects (while bad) were therefore limited
I recall reading after the USSR collapsed that Poland was the most polluted country in the world. All due to the rush to industrialize and to heck with the environment.
Chernobyl is another case about communism giving short shrift to environmental considerations.
Of course one could argue that that this wasn’t the fault of socialism, but rather a government that prioritized the desires of industry above all else.
Lest we forget when that paragon of free market capitalism, the United States, prior to the creation of the EPA and its glorious burning Cuyahoga River.
So you agree. A robust government regulatory agencies with effective enforcement is required to ensure the protection of the environment and workers' safety and dignity.
I'm glad we see that the inevitable outcome of free market deregulation is destruction.
I agree with you, but I think what most people fail at is applying higher-order logic. Yes it is nice that private citizens have Jeff Bezos levels of wealth instead of monarchies or plutocrats, but at what cost? Most people are just unwilling to keep thinking about opportunity costs beyond the obvious.
People have always peed in bottles when they're on a long drive, piloting an airplane long distance, on a sailboat, and so on. Some peoples' bladders have a short fuse, and carry a bottle.
Do you think Lindberg brought a port-a-potty along with his Spirit of St Louis? I remember the opening sequence in a Jeff Bridges movie where he pulls over in his car and dumps his pee bottle.
P.S. My dad was a B-17 navigator in WW2. I asked him what did they do when had to go. He said an empty ammo box was used. What was done with the full box? "Extra bombs over Germany!"
I'd rather live in a world where Amazon employees have time to pee on the job and Jeff Bezos has $10M less. Iterate until Jeff Bezos only makes ~10^2 what the median Amazon employee makes instead of ~10^6.
At that scale, Amazon would just be warehouses of people pissing in bottles. They'd have to piss all day and all night until the heat death of the universe, just to cost him even one billion. So few people realize the scale of a billion :(
You did just imply that peeing in bottles is fairly reasonable for certain hectic environments. Perhaps so, but you'd need another explanation for why it's reasonable for a workplace like Amazon's warehouses to embody that. I think there should at least be heavy scrutiny towards that premise.
So Amazon can't afford to provide sanitary, safe restrooms and not overwork its employees? I don't think people go hiking because they're running from a bear or wildfire; they do it because they feel like it, and so they plan accordingly.
It's not a difficult problem to reconcile capitalism and sustainability from a technical perspective. Just a question of political will.
Carbon taxes. Water prices reflecting scarcity. Compensating people living in rain forests to not cut down their trees.
Capitalism is still the best tool we have for setting prices and incentivizing efficiency. Just needs to be guided to place appropriate prices on externalities.
Water prices reflecting scarcity are not a solution for water scarcity.
The problem is not enough water. You can't make water by taxing it.
All you're doing is making it less accessible for people lower down the hierarchy - which makes it even scarcer, because people at the top of the hierarchy end up hoarding it and/or profiteering.
Which is why price signals are one of the dumbest of all possible ways of managing resources. They're a political non-solution to a physical problem.
You may try to argue that "incentizing efficiency" means more water is produced. But that is empirically false.
The only real competition is capitalism is for shareholder cash. Customers are thrown overboard if their interests conflict with that goal.
None of this solves the physical, tangible problem of providing a stable water supply.
If you're having trouble understanding this, ask the people in Flint MI how making imaginary money game tokens more important than providing a usable utility has worked out for them.
You might also want to look into why the UK's water companies are currently dumping raw sewage into rivers. Hint: because they can, and because it's more profitable than filtering it first.
> Which is why price signals are one of the dumbest of all possible ways of managing resources. They're a political non-solution to a physical problem.
Au contraire; distorting or ignoring price signals is the dumbest of all possible ways of managing resources, precisely because you let people pretend that the underlying realities don't need to be contended with.
> Water prices reflecting scarcity are not a solution for water scarcity.
I assume the GP is referring to things like how agricultural water is dirt cheap in arid parts of the US. By making those prices better reflect reality (of scarce water in those regions), water-intensive agriculture will need to happen elsewhere, freeing up water for residential consumption, for example.
> why the UK's water companies are currently dumping raw sewage into rivers. Hint: because they can, and because it's more profitable than filtering it first.
So you agree that price signals would fix this problem?
You know, the one comforting thought in all this is, politicians can try to argue and bargain with physics as much as they want. Physics doesn't care.
You either accept that infinite growth in a universe with limited resources is impossible, or you're stuck loosing the rhetoric battle against physics.
I think the only sustainable way forward is to divorce our concept of wealth from growth, and ever increasing exploitation of resources.
Capitalism requires a philosophical split between labor, productivity, and capital ownership
A market is simply a price clearing mechanism in the context of known exchange rates of commodities, you don’t even need money for it, and says nothing about the ownership composition of the actors making trading decisions
If you have a labor market then you have capitalism, since it lets you hire labor to work for you and that is enough to make you a billionaire. So markets and capitalism are tightly coupled things, you can have some very limited markets without capitalism but in general if you have a pretty free market you have capitalism.
You have a lot of faith, it seems, in the ability of the already rich to somehow make better decisions (by some metric) than an arbitrary political process. I don't mind if Jeff Bezos the person exists, but I have no reason whatsoever to want him to have control over the scale of resources and decision-making that he does.
> You have a lot of faith, it seems, in the ability of the already rich to somehow make better decisions
Not at all. A large fraction of the "already rich" did not get their wealth by productive efforts. They got it by convincing other people to take the wrong end of zero sum trades, thus siphoning wealth out of other people's pockets into their own. Even in the case of Jeff Bezos, who has certainly created a lot of wealth through Amazon, it's also true that his own personal wealth is not entirely due to that productive effort; a significant part of it is due to Amazon playing zero sum games with its supply chain and its workers.
In other words, the real problem is not wealth accumulation, but wealth accumulation through zero sum games, or more generally through gaming the system instead of producing. (There was a pg essay on this years ago.)
Being able to quit a terrible workplace doesn't imply that one has achieved a reasonable standard of living and is just making more money. Indeed, if people continue working at a workplace where they're subjected to conditions they think are terrible, they probably don't do it just to make more money.
> You have a lot of faith, it seems, in the ability of the already rich to somehow make better decisions (by some metric) than an arbitrary political process
A key advantage of leaving it to the rich is that when rich people fail, they tend to end up losing their wealth and power, hurting mostly themselves — while even a political process that isn’t being corrupted or gamed by someone powerful is badly incentivized to throw buckets and buckets of good money after bad, hurting lots of people.
Elon ruining Twitter is at least his own money. The California bullet train will be an unprofitable multibillion drain on the state for decades to come …
This (conveniently) ignores (as do so many similar analyses) the opportunity costs of entering into a labor contract.
When an enterprise fails, it is not just the stockholders and corporate officers who suffer. The employees do too. Worse, only the foolhardy investor puts more than they can afford to lose into a risky investment, meaning that while they have undoubtedly lost money from the failure, they are almost certainly still "whole" in terms of their ability to meet their basic needs. By contrast, the employees, who may have lost no capital, often face much more dire circumstances in the aftermath of a venture failing.
>even a political process that isn’t being corrupted or gamed by someone powerful is badly incentivized to throw good money after bad
(I see you edited your post to add the last line).
Elon is not "ruining his own money". He gained control over large quantities of economic and financial resources, and because of the way our society works, he gets to "ruin" those resources by choosing to direct them to the purchase of an asset followed by its degradation.
But there's an opportunity cost to all that: what might have happened in Elon was not in a position to command the utilization of the wealth that purchased Twitter? What else might that wealth have been used for? What might it have been accomplished?
You could make the opposite argument about all the innovations, are and science, rich people have funded throughout history. Like what if Boeing didn't have all that money to dump into airplanes.
To start with, Boeing benefitted from massive amounts of government contracts during their history, which provided much of the money they "dumped into airplanes".
Secondly, we now see a company whose products have severe safety defects due to the influence of cost-cutting managers, more concerned with profits than quality.
You are presupposing that such things would not have happened if the resource allocation decisions made by the wealthy had been made via some other (more democratic) means.
There's not really much evidence to support that claim (though to be fair, not much evidence to refute it either).
If getting laid off from a six-figure salaried job is what people are calling "life-ruining" in this day and age, then we're clearly doing something right as a society! Sadly, I've had the misfortune of living through far deeper traumas, and I can't help but laugh at the suggestion that getting laid off from my current tech job would somehow "ruin my life" by any stretch of the imagination. Sure, it might cause some temporary distress, but my rainy day fund would be able to tide me over until something else came along.
> You have a lot of faith, it seems, in the ability of the already rich to somehow make better decisions (by some metric) than an arbitrary political process.
I have faith that an Olympic athlete is a lot better about making diet and exercise decisions than I am.
I have faith that Mick Jagger is far better at crafting a new song than I am.
I have faith that Tom Hanks could make a far better movie than I can.
I bet you'll find their track record is a lot better than that of non-wealthy people. Most non-wealthy people I know do a lousy job of managing their finances.
Frontline ran an episode a few years ago about 401k plans. They found that the wealthier the employee was, the better returns they had on the company 401k plan, despite the fact that the plan was identical for all the employees.
OK, so people who are good at managing their money are ... drum roll, please ... better at managing their money.
This is a tautology.
The question is not whether rich people are better at running their own finances, it is whether they are the best people to be making resource allocation decisions.
In US capitalism, the argument for coupling the two normally consists of "well, they want to make money, so they will do what people want, and so we get what we want and they get rich and that's good".
This is just so absurd that it's really not worth deconstructing.
The age old conundrum: do people want what they get, or want what they get?
Bezos got rich by buying labor from people for less it was worth, buying products for less than he could sell them, and using them both to create a new retail possibility that had some distinct benefits for a lot of us in our role as consumers.
I never used the phrase zero sum, and I don't think it's appropriate in this context at all.
There's almost nothing that happens in a modern society that isn't a good deal for some of the people involved. Consequently, "it was worth it to X" isn't much of a metric. I get the sense that you're not a big fan of the concept of externalities.
In the Prisoner's dilemma, defecting is "worth it" to both, but neither wants to be in a situation where the other will. It is easy to create equivalent scenarios — one does not even need to intend to do so, though of course the scenario from which the name comes, the situation was constructed to get an outcome that a powerful person wanted.
I think it is an important part of government, now that we know about Nash equilibria, to make sure that social and economic incentives are such that the collective good is aligned with the personal good. Neither Adam Smith and Karl Marx knew about these when they wrote their famous works, and (I think) just assumed these would be aligned.
This is not to say that Bezos did or didn't do anything in particular; while there are things I'd criticise Amazon for, I think roughly half the usual talking points are misunderstandings.
Also, your question sort of implicitly requires ignoring all the attempts to do "something like what Bezos did" that failed. A bunch of resources went into those efforts that came to nothing. This is not a zero cost to society. There was always going to be someone who succeeded at this, so noting that Bezos did so is relatively information free. The bigger question is whether the way this happened - let a bunch of money be thrown against the wall and see what sticks - is really the best we can do as a society and as an economy.
What a load of crap. Capitalism rewards existing capital. These people have opportunities 99.999999% will never have and still they got lucky. It's not about competence. It never is.
Our current society rewards people that can lie, cheat and backstab while punishing those who care about anything other than profits. Just take a look at SBF and all the startup snake oil culture and it's clear they're not competent at anything that helps society.
> What a load of crap. Capitalism rewards existing capital. These people have opportunities 99.999999% will never have and still they got lucky. It's not about competence. It never is.
It's about both. Musk, Bezos, Gates, they sure did all get lucky, but they also had skill. Skill alone isn't enough, because there are plenty of people with more skill. Luck alone also isn't enough, because that would give a distribution like lottery winners rather than repeated year-on-year growth.
> Our current society rewards people that can lie, cheat and backstab while punishing those who care about anything other than profits. Just take a look at SBF and all the startup snake oil culture and it's clear they're not competent at anything that helps society.
That's a terrible argument. SBF was convicted and is awaiting sentencing, that's not rewarding his misbehaviour; "startup snake oil culture" is tautologically going to be the specific set of bad actors without telling you anything about the relative frequency compared to all startup culture; and the Effective Altruism movement, which has inspired many startups in many areas, is collectively quite embarrassed by the association with SBF.
Also, to be competent at lying, cheating and backstabbing, necessarily means "knowing how to get away with it" rather than just "does it". Niccolo Machiavelli wrote a book about that 500 years ago, and Chanakya wrote a treatise also covering those things about 1800 years before Machiavelli.
I agree. But then why would we ever worship the few lucky ones and allow them to have basically unlimited power? We could even claim intelligence is mostly about genetic luck. But if we really wanted to reward people for hard work, then there wouldn't be billionaires, we'd have many, many more millionaires.
Why do they deserve that disproportionate amount of power? I simply cannot believe a system that rewards like that is anything but unfair. If everyone also got much more, that would be fine, but it's always: 9999999 for me, 1 for you.
>Skill alone isn't enough, because there are plenty of people with more skill. Luck alone also isn't enough, because that would give a distribution like lottery winners rather than repeated year-on-year growth.
That would be true, if the fact that monopolies - which are the consequence of competition - didn't allow them to hold their positions indefinitely.
This is late stage capitalism. The opportunities that existed back in those days simply aren't there anymore. The best you can hope for is to find someone to fund you (or bootstrap), then get bought by one of the mega corporations allowing them to keep their monopolies.
>That's a terrible argument. SBF was convicted and is awaiting sentencing, that's not rewarding his misbehaviour;
No? Come on mate, SBF was ONE guy that got arrested. What about all the other ones that are still out there? Did all the cryptobros that cheated people out of billions of dollars get arrested? 5 minutes of googling and you'll find thousands of scammers that got away with it. Not including the ones that won't even show up in searches.
So, yes, that's rewarding misbehavior in my view.
The easiest way to get rich in our system is to lower your scruples. That's exactly what the system was designed to do: reward exploitation. That's the whole premise!
If I can cheat you out your salary, your labor, your working conditions, your naivety, your situation, your health or whatever else I can, capitalism will reward you for it. That's what profit is.
> I agree. But then why would we ever worship the few lucky ones and allow them to have basically unlimited power?
Because hero worship is an evolved instinct that we're trying to confabulate a post-hoc justification for, rather than a coherent predictive framework.
And because our monkey brains, being only numerate by evolutionary luck, have an emotional reaction to "a billion" approximately as if it was "two million" rather than "a thousand million".
When kings ruled, some claimed it was by divine right. Those with power who didn't like the rise of money displacing the old forms of wealth use the term "nouveau riche" as a pejorative — this phrasing may be relatively modern French, but the idea goes back to at least Ancient Greece.
> Why do they deserve that disproportionate amount of power?
For most new-money billionaires — though ironically, not ones who got there "fairly" like JK Rowling or (after actually selling to Microsoft) Markus Persson, but I bet they invested their money in something like this after being paid — the money is predominantly in the form of shares granting the right to a say in the management of, and disbursal of the profits of, some corporation which gained its value through their leadership.
As countries want tax revenue to get stuff done, their governments don't need any complex reasoning to place a high value on people who are competent at making high-value corporations.
> That would be true, if the fact that monopolies - which are the consequence of competition - didn't allow them to hold their positions indefinitely.
Their monopolies don't remain indefinitely. IBM used to be a monopoly, until it wasn't. Internet Explorer triggered a monopoly lawsuit, now even Microsoft doesn't support it. Games consoles was a Sega/Nintendo duopoly when I was a kid, Sega no longer makes hardware. Amazon wasn't allowed to buy up iRobot (nor Adobe, Figma) because governments are bigger than corporations and do actually step into prevent abusive behaviour. Bell Systems was, famously, forcibly broken up: https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System
I won't be at all surprised if in the next decade half of Big Tech is split the same way Bell Systems was split — e.g. Amazon forced to split apart its main storefront, Audible, the Kindle book store, and all the web services.
> Come on mate, SBF was ONE guy that got arrested. What about all the other ones that are still out there?
Then don't use him as the example. Him being arrested is what makes him a bad example. If you want to say people don't get punished, give those other people as your example, not the very obvious example of someone who is getting punished.
> 5 minutes of googling and you'll find thousands of scammers that got away with it.
You clearly have different search results to me; the results I get are "until we arrested them".
> Not including the ones that won't even show up in searches.
Tautologically, but you have to show a reason why some invisible group is of some actual specific size in order to make any argument about them; and in your case you have to also show that the size of this invisible group is due to the economic choices of Capitalism rather than anything else.
> The easiest way to get rich in our system is to lower your scruples.
In any system. You don't get far in a feudal system without being willing to take freemen into debt bondage, or to bow before each of a series of monarchs that take turns flipping between "Catholicism is mandatory" and "Catholicism is forbidden" as the British ones did for a bit.
> That's exactly what the system was designed to do: reward exploitation. That's the whole premise!
No, the premise (which I would argue is flawed for due to "Prisoner's Dilemma"-type scenarios) is that everyone acting in their own self-interest will ultimately reward the collective. It assumes that any worker who is not treated fairly will switch jobs because someone else will want to out-bid their current employer. Etc.
> If I can cheat you out your salary, your labor, your working conditions, your naivety, your situation, your health or whatever else I can, capitalism will reward you for it. That's what profit is.
If.
Under capitalism, a completely free market in a steady state and with perfect information will have no profit, because everyone will try to undercut everyone else until profits disappear. Temporary circumstances, such as floods or famines or whatever, drive up demand, creating a profit opportunity, attracting business to supply more stuff.
Real markets don't have perfect information, and I'm told can't because that's apparently NP-hard. This is part of why I value government intervention, and also why I currently believe that it would be good for governments to directly control (either by owning or commissioning) parts of national production. Not all production in any sector, that would probably fail due to government monopolies having their own weird pathologies, but some production in several sectors.
> Because hero worship is an evolved instinct that we're trying to confabulate a post-hoc justification for, rather than a coherent predictive framework.
But that's not why I'm posing the question. Maybe my phrasing wasn't great.
We are all about becoming more than just monkeys, so perpetuating a silly tendency especially on such a serious topic with enormous consequences should be avoided at all costs. I argue we should not worship lucky rich folks.
> I bet they invested their money in something like this after being paid
Yeah, probably. But once again, I posed a question of why should they be rewarded in such a way. There's no answer to that here. I'm not arguing people shouldn't be rewarded, but as it stands the proportions are simply insane.
Part of the issue is that when you have capital you can literally change the rules of the game. So they don't just get rewarded with capital, they now can generate capital more easily too. It's a double advantage that breaks the system, in my view.
> Their monopolies don't remain indefinitely.
I honestly hope you are right, but I have serious doubts here. Rules that applied back in IBM days were different and companies and individuals simply got way better at retaining power. Monopolies are basically impossible to be broken in a globalized world, and companies know that. They also no longer leave room for the small guy. You won't ever have the Yahoo/Google situation again. If any company starts to show any threat to any monopoly, they get acquired immediately.
In theory regulators could try to enforce some of these rules but I don't see it happening. Even the latest Apple app store debacle shows how little they actually care. They can get away with pretending to do something about it because they have too much power and money.
> Then don't use him as the example.
Fair, I guess. My point is that for every one guy that gets arrested, you have all the hundreds/thousands of people around them that also profited from these scams. Those are almost never arrested and end up profiting without consequences.
For a high-profile example, you have famous influencers like Jake Paul scamming millions out of people and thriving. I watched a recent Netflix documentary Bitconned [1] which also shows another perfect example of someone scamming, getting caught, getting "punished" and still living their best lives.
For every SBF with hundreds of years in prison, you have dozens/hundreds of others that get a slap on the wrist. Fines, for example, could just be written off as cost of business.
I won't go searching for more because the topic doesn't interest me as much, but I am absolutely sure there are many, many more stories like these. But to your point, I can't prove the existence of those hundreds of millionaires that didn't get caught without going deep into it, so I won't try to. Guess you're a glass half-full kind of guy. I can't see how they don't exist.
> It assumes that any worker who is not treated fairly will switch jobs because someone else will want to out-bid their current employer. Etc.
Which would be true, in the utopia Capitalists believe in, where everyone has a choice. The reality, monopolies and lobbying exist, so workers always get fucked. Work or starve.
> I currently believe that it would be good for governments to directly control
I 100% agree that many parts of the national production should be owned by the people. Companies can simply exploit natural resources today basically for free, without consequences.
> If
Looking at what we have today, there's barely an "if" there. Take any company above a certain size and a lot of its profit comes from exploitation: underpaying workers because they target vulnerable communities, bad working conditions because they lobbied for no worker rights, cheap materials/manufacturing from poorer countries that in turn exploit their workers even more, exploiting/overworking young talent because of their naivety, overcharging due to monopolies, and the list goes on.
I take it back, there is definitely an "if", but it is only a matter of capital. Once the company gets enough capital, it turns up its dials of exploitation. If they don't do that, they don't survive.
Maybe there are examples of companies that grow and don't become an exploitation center, but I have never seen one. The system rewards exploitation, because that's the best way to extract profit out of human resources. And since companies are not people, they can and will do anything regardless of morality, leading to the current state of affairs.
The issue here is the genericity if money. I think hardly anyone would argue that he shouldn't make decisions for Amazon. He is probably the best individual for this. The issue is that controlling Amazon also comes with the possibility of getting out of it and somehow be allowed to control vast amount of resources completely independent of it and possibly built decades or even centuries before Amazon even existed.
One of Bezos' best attributes was (is? no idea) knowing that he was not the best individual to make most of the decisions for Amazon. He had strong ideas about how to hire people, how to create "meta-strategies" and then let the people who he believed actually knew stuff make the choices. So actually, even within Amazon, he almost certainly was not the best person to make almost any of the decisions the company faced.
Much better to have a large number of wealthy actors deciding how to allocate capital than just one (the government). Certainly we can do with higher taxes for the ultra wealthy though. It's hard to imagine what one can do with 100 billion dollars that you can't do with 10 billion.....
I honestly can't tell if you're being sarcastic or not.
It seems impossible to perfectly allocate capital, of course there will be stupid and actively harmful allocations. But the government does both of those things too.
So yes it is legitimately good to have a really large number of actors allocating capital, to in ADDITION to the government.
> I honestly can't tell if you're being sarcastic or not.
Kind of.
If the premise that government + a few rich people is a better way to spend $ (e.g. our current system !) then how about we also try government + spreading $ around so a lot of people are well off and can "allocate capital".
I certainly think our current system is better than 0 rich people.
I think a better system would include more money spread around the middle class, fewer people in poverty, and a larger number of rich people with fewer individuals having > 10 billion dollars. That makes it harder for a small group of rich folks to band together to screw up democracy since there should, presumably, be greater diversity of opinions in the group of rich folks.
The main post is literally saying "no rich people" so that's the part I'm focusing on, but yes the middle class in America needs far more help than it's getting.
That doesn't mean it always makes the best decisions. It seems valuable to have those who are so inclined with enough resources to try things that the government can't or won't try. We've gotten so many good things through this process. I'm not saying the government shouldn't do stuff, it very much should.
"it doesn't always make the best decisions" isn't the standard here.
No human organization always makes the best decision.
The question is: how best to make decisions about resource allocation? Do we favor this being the domain of (primarily) already rich and powerful people? Can we even imagine an alternative?
I agree that no human organization will always make the best decisions. That's why I'm advocating for a larger number of human organizations making decisions independently (as much as is possible in the world today). I was also being somewhat soft in my language, so let me amend it to, sometimes the government makes bad choices and fails to invest in crucial areas.
Are you advocating for more organizations created as cooperatives and the like? I think that would be great too. However a lot of ambitious projects like curing diseases, inventing new materials, building spacecraft, and more require a lot of money.
It's much easier to start on these things if you can skip fundraising from thousands of individuals.
As a thought-experiment, suppose you have a society in year X in which a substantial majority of people are opposed to putting resources into some project.
Time passes, it is now year Y and an individual has managed to amass control over sufficient resources to at least begin this project.
More time passes, it is now year Z and the project requires further investment. The individual who initiated it seeks public funding to continue the work?
1. is it appropriate in a democratic society that an individual can direct resources on a large scale into projects rejected by most people in that society?
2. should the society consider funding the continuation of the project?
If the answer to (1) seems immediately clear to you, consider your answer in the case that the project is "Invade our largest neighboring country" or "Develop new bioweapons that will only affect people of a certain genetic makeup" or even, somewhat realistically, "Develop ways to burn fossil fuels on sufficient scale to alter the composition of the atmosphere".
What is the qualification possessed by the very rich, other than "well, they're rich", that should entitle them to make such decisions?
Qualifications aren't in play here. It's effectively random capital allocation. So they have been randomly entitled to those decisions. This seems far better than having a single entity to do so.
A majority of Americans disapproved of the Apollo program. So the government does not avoid doing unpopular things.
I whole heartedly agree with 1. Society in aggregate doesn't support all the things that would benefit it. In the case of 2, if society has suddenly decided that in fact it does support the project from 1 now, then yes, it should of course fund it. And this actually really demonstrates the value of private investment. A project can be started that most people don't think is worthwhile and then it can show benefits and the general population can support it further. That's wonderful.
I don't recall proposing no government. Those first two were illegal and the government willingly ignored the third in the past, so IDK why you think the government would have done differently.
It's not just government that fails and makes bad choices. So I'm not interested in questions that frame the distinction as being between private decision making and public decision making. We have agree that no human organization will always make the best decisions, so the question is how do we try to improve the chances?
There was a lot of interest in this in the 1960s, but it fell away as neoliberalism triumphed, and with it the idea that some sort of multiplicity of private actors will always make the best possible choice that we could. I don't believe this, especially since "multiplicity" has frequently come down "a few, maybe 2 or 3".
Yes, I love cooperatives, though they are hard to make sustainable and successful. Big projects requiring lots of resources should be hard to start, and should start only when we agree that devoting lots of resources to the problem is the right thing to do, via a democratic process. Problems that require very few resources do not need to meet such standards, and efforts to solve them can come and go as people feel like doing.
The number of private actors capable of acting in a space has not been that small since like the 50s, if ever. You're trying to equate this to corporate cases like Apple and Google in smartphone OSes, but this is far broader. This is the entire economy. I feel like you're thinking just about corporations, which is a different conversation IMO.
You can even look at space exploration as an example since when we talk about rich people everyone thinks of Elon now. There are so many space companies started with private investment. SpaceX, Blue Origin, Virgin Galactic, Virgin Orbit, Armadillo Aerospace, Rocket lab, Polaris, a planetary resources, and more that I've never heard of. That's way more than 2 or 3.
I think humanity is at its best when it can organize into small groups working on big things that can be made available and/or useful to everyone else and that's just really hard to do without money. I don't want to spend my time allocating capital. Randomly assigning the job to as many of those interested in doing so as possible seems like the best solution, with augmentation from the government of course.
A strong Democracy safeguards the interests and priorities of the majority of a society - say, like the Brenton Woods system.
Whereas our recent Pax Neoliberalia only caters for the interests and priorities of the richest. Thomas Piketty wrote a whole book demonstrating this: r > g.
I completely agree with both of your statements. But I don't see it being related to what I said? Unless you're saying that having any rich people contaminates the system?
The point is that progressive very high taxes are indeed a good idea (or some form of “Limitarianism”).
Alternatively, but in the same direction, the taxpayer should get a dividend on their investment. Is not by chance that big tech prospered in comfortable societies, and not in, say, some place full of roaming gangs flashing fixed big machine guns on the back of their pickup trucks.
>> Unproductive wealth is the real devil, the hoarding of inelastic goods like land, gold, and oil
How would hoarding of gold, in and of itself, be bad? Say someone goes out and works and makes money, and they take the money and buy gold coins and keep them in a safe, or fill up a swimming pool so they can dive into their hoard of gold like Scrooge McDuck. They are contributing to society, and to the extent they hoard gold, asking nothing back for what they have contributed.
It's like what Charlie Munger did. Made a massive fortune, spent his whole life doing it, had an amount of money that he could have used for extravagant spending, could have bought whole islands in Hawaii, could have bought politicians. But he didn't. He earned the money, earned dividends on the money, piled up all the money in a hoard. Then he died.
Charlie Munger achieved the vast majority of his wealth not by hoarding inelastic goods but by investing and reinvesting in dividend-paying stocks and bonds, virtual tokens representing liquid fractional ownership of productive enterprise. He can "hoard" those all he wants, and we all benefit from the greater levels of capital available to said productive enterprise.
Now, if gold or other precious metals are necessary for the production of desirable goods, the hoarding of such assets increases the price of those goods in a zero-sum fashion. Of course, I'd never want to deny someone the pleasure of swimming in a pile of gold coins like Scrooge McDuck. I'm just saying that they shouldn't be able to profit as much off of keeping the pile locked away in their mansion. Rather, they should repay society for its losses in the form of a land value tax.
Hoarding gold isn't inherently bad, but many super rich people who arguably don't deserve nearly as much wealth as they have (worker exploitation, buying politicians, inheritance money, etc.), especially when juxtaposed with the terrible wealth inequality gap that they have the greatest ability to amend (through not exploiting, donating wealth or being taxed, not buying politicians to favor them, etc.). If everyone had a good baseline of living and politicians won't be bought to revert things, then no, I don't see a major issue with gold hoarders. But that's not the world we live in today.
This is basically Georgism: a tax on idle assets like land paired with very low or non-existent taxes on income and capital gains. Land value taxes would be on the land only and not things like buildings on it, so this would heavily incentivize maximally efficient use of land.
I'm generally a fan though I would also add pollution taxes and short term capital gains (gambling) taxes.
> This is basically Georgism: a tax on idle assets like land paired with very low or non-existent taxes on income and capital gains.
Ah, so you've seen the cat! Yes, this is precisely what I was getting at.
> I'm generally a fan though I would also add pollution taxes and short term capital gains (gambling) taxes.
The former is known as a Pigouvian tax[2], and I yearn for such taxes with no less of my heart than I yearn for land value taxes. The latter, however, seems almost completely unnecessary. Why not allow people to gamble on noise? And if they're making a profit, it's more likely than not that they're adding signal and contributing to price discovery, along with providing short-term liquidity to all market participants! I don't mind anyone getting paid for that.
> a society which taxes inelastic goods and negative externalities and returns that wealth to the public over one which does not.
The problem is that this kind of society, even if we assume for the sake of argument that it would be preferable, is not really achievable politically. The only way to implement it is to have a government that has the power to coercively tax people, and all history shows that governments will not use that power to redistribute wealth to the public at large; instead they will use it to enrich themselves and their preferred special interests.
> There are countless programs that redistribute wealth.
They purport to, yes, but for most of them, when you dig into the details, you find that what redistribution actually occurs is not from richer to poorer, but the opposite. And much of the money spent on the programs doesn't go to the purported recipients of redistribution at all, but to third parties. (For example, you cite public schools as redistributing wealth--but government funds for public schools only pass through the hands of the families whose children need schooling in the case of school vouchers, which are fairly rare, and in any case the money doesn't stay with those people, it ends up in the hands of the schools themselves. Given the current state of education in the US, anyone who wants to make a case that whatever redistribution of wealth occurs actually benefits the children and families has a very tough case to make.)
But it’s not productive wealth is it? It’s just stock. It’s Locked up value that he hordes like a dragon. That money isn’t actually being used to generate anything. Even when it is spent, it’s just financial products that generate money through financial transactions instead of actual goods and services.
This has been the case since the 1980s when capital gains started being taxed below income, and the carried interest loophole was created. In fact, this is a well known economic phenomenon. Some would go as far as to say that it is an intentional outcome of the policy.
In the end, the problem with Bezos and the rest of the oligarchs is the same problem with monopolies, it’s a command economy. Only instead of being dictated by some unelected government bureaucrats in a totalitarian state, it’s a a bunch unelected rich dudes with dreams of a totalitarian state.
> But it’s not productive wealth is it? It’s just stock. It’s Locked up value that he hordes like a dragon. That money isn’t actually being used to generate anything.
Oh, but it is! That value isn't locked up, it's invested in the company. That investment raises the level of capital available to the company, allowing them to hire more employees and offer more goods and services. That's all real value for real people, and yes, if it works out, capitalists get paid for making it possible.
We already live in a world where one can own the means of production. The likes of Vanguard and Robinhood broker access. With a few clicks, you too can become a more productive capitalist.
> the hoarding of inelastic goods like land, gold, and oil.
What do you mean by "hoarding"? I don't think any living person owns enough land, gold or oil to represent even tiny percentage of the overall market. The whole Russia, for comparison, owns 12% of oil market. So if you personally owned all the oil in Russia (by any measure an achievement far beyond the wildest dreams even of the richest Russian oligarchs, who still have to share among many others) you'd still be just one of the players. So I don't think those mystical "hoarders" really are as scary as you seem to think they are.
Just because hoarding is popular doesn't mean it hurts society any less. We all pay for the inefficiencies it produces, whether or not it's distributed. (Granted, distributed hoarding is better than centralized hoarding as demonstrated by the likes of De Beers et al.)
> Unproductive wealth is the real devil, the hoarding of inelastic goods like land, gold, and oil.
They're not wealth if they're hoarded. Undeveloped land, or gold and oil in the ground, are no use to anybody. They're only wealth if they're used. And that requires lots of productive effort to develop the land, or to get the gold and oil out of the ground and into productive use. I agree that unproductive wealth is the real problem, but we need to be careful how we define it.
Maybe I'm getting my terms mixed up, but wealth includes anything with value, no? So long as somebody else wants to develop that land, or mine that gold, or tap that oil, it is wealth. At least, that's my understanding.
"Funny" things will happen, when the labor factor is removed from the three factors of production by AGI. ~Jeff can finally have the planet all for himself.
Indeed, but only insofar as he can accumulate military power. Relevantly, incompletely taxed land ownership is a means of renting such power from the state, hence my gesturing toward a land value tax and universal basic income.
My take becomes a lot more interesting when you consider that only 77 million Americans own land[1] while more than double that number, 158 million, own stocks[2] (and millions more own other elastic liquid assets).
Yes, it's a wildly popular and literally ancient meme that land ownership is the path to wealth, but people aren't stupid. When the structure of the economy changes, human behavior follows. Current landowners don't even get screwed over, they just stop accumulating additional wealth from hoarding land. More likely than not, they'll sell that land for roughly whatever it was worth when the tax came into effect to enterprising developers who will buy it and attempt to turn it into something more productive for a profit. After all, land value taxes only apply to the space occupied by the land itself, not any improvements on that land like apartments or offices. Coupled with zoning reforms, we'd see apartment complexes replace single-family housing and train stations replace parking lots as suburban sprawl transformed into walkable paradise.
What things of importance has Bezos done? End world hunger? Or are we celebrating the death of local stores and malls? What about a society that prevents kids from starving instead of making bombs and satellites for world wars?
Bezos' AWS made cloud computing viable, leading to the last two decades of economic growth without per capita energy consumption (due to datacenter energy efficiency).
Bezos' Amazon lowers the cost and availability of goods of all kinds drastically, enriching everyone (and especially the poorer among us).
The State makes bombs and drops bombs, not Bezos. Bezos deploys capital in ways which have proved to fill market needs. Markets are people. His money is meeting the needs of the people while taxes build bombs.
AWS would not be possible without the contribution of hundreds of thousands of people and projects from the inception of the internet. It really is just a software on some redundant servers running open source software... it's not that incredible.
> AWS would not be possible without the contribution of hundreds of thousands of people and projects from the inception of the internet.
Quite notably, that number of people developing, distributing, supporting, and extending AWS is a few magnitudes smaller than the billions of people that live on the earth and benefit from or use AWS everyday.
So, what do you have to say about that inequality?
You can claim the man sweeping streets in Africa was quite integral to developing AWS alongside myself and thousands of engineers, but you will never make me believe it.
He used money he hoarded from another venture to allow the thousands of engineers to build it. Anyone can do that.
And I'm 100% sure Bezos was not the one that came up with the idea either. He just benefited from being in a position of power with tons of capital at the right time.
> He used money he hoarded from another venture to allow the thousands of engineers to build it. Anyone can do that.
So why didn't they?
> And I'm 100% sure Bezos was not the one that came up with the idea either. He just benefited from being in a position of power with tons of capital at the right time.
Same question again. What in your opinion, is a bet that you can make right now, today, that will lead to another Amazon? Or maybe even something bigger?
I have a similar amount of capital as Bezos did free and ready to go to when he started Amazon, even inflation adjusted. I probably have a lot more power than he did at the same time since I am actually a manager of a few engineers which he was not.
Am I going to be back in those times where that capital was a lot? Where what we have today isn't there? Will I have access to the contacts and his network?
Let me guess: no?
What an odd request. This is such a lazy argument.
> So why didn't they?
The truth of the matter is: they couldn't. Bezos, Musk and Bill Gates were perfectly positioned to do what they did. You don't even hear about the hundreds of others that had the same (or better) ideas, that didn't have the capital, the connections, or even the timing.
This hero worship makes zero sense. If Bezos wasn't already rich, Amazon wouldn't exist. If Bill Gates didn't have contacts inside IBM, Microsoft wouldn't be what it is. If Elon didn't grow up filthy rich, he wouldn't be the world's richest man.
I know it's easier to believe the good old "work hard and you'll be rewarded" adage, but it's a plain lie. We have multiple orders of magnitude more of hard workers compared to billionaires (or even millionaires) to prove that. No, it's not because they were geniuses or hard workers. They might've even been that, it's beyond the point. They were plain lucky.
In today's society, previous capital is the best predictor of success there is. Not intelligence. Not hard work.
You're right that the hero worship doesn't make much sense as the economy for successful megaenterprise is a bit of a lottery. However, you very well could build the next big thing today. We're literally having this discussion on a website owned and operated by a startup accelerator, the entire purpose of which is to provide a network for making business connections and accessing capital. Like Bezos and Musk, however, you're going to have to risk some of your own time and money if you want to get anywhere, and like their thousands of contemporaries who were trying to accomplish the same things they did, you're more likely to fail than succeed. It is truly a lottery, but that isn't what makes it unfair.
> In today's society, previous capital is the best predictor of success there is. Not intelligence. Not hard work.
Absolutely! However, those latter two things help a lot with generating the former, if not for yourself, then maybe for your children. Who knows, you might raise the next Bezos or Musk! Probably not, but maybe! At the very least, you'll throw money away helping your kid do something they enjoy.
Alas, it is inescapably true that money begets money, but that's why I emphasize a tax on zero-sum harm and hoarding (e.g., burning coal, buying land) to the benefit of positive-sum productive investment (e.g., taking risks, paying salaries).
Aside from that, it's not obvious to me why we need a Bezos to achieve this. If people were capped to $5 billion (which seems absurdly high to me), would AWS never come into existence?
Bezos's net worth is basically just the number of shares of Amazon he holds times the price per share that the market arrived at (and continues to arrive at, changing every minute of every day). How would you cap him at $5B?
Would you force him to divest his shares as that equation approaches $5B, even though he's not the one setting the price per share? That hardly seems fair, like an old widower whose home's value arbitrarily fluctuates with the real estate market, and who may no longer be able to afford the property taxes at a higher valuation. Would you force the market to not value each share above that which would place his stake at $5B, even though each buyer and seller (neither of which is Bezos) agrees that it's a fair price for them to transact at? That doesn't seem right, either.
I don't think it's unfair to make him divest some of his shares. I suppose there could be leeway there, but having over $100 billion in shares certainly seems excessive. Hey, if taxes are paid as they should be, working conditions improved, and whatever else, I personally don't care so much about a wealth cap. But a wealth cap is a means to ensure that the government has the money to redistribute the wealth appropriately. In the end, as long as the outcomes are achieved, I'll consider that a win.
Society has collectively voted that Amazon massively improves their lives. If they didn't think so, they'd still be choosing to shop at Sears and Kmart and hosting their software on HP enterprise servers in a musty office basement.
That's all the clear and evident result of the market system which is very democratic. People vote with their dollars every day. The winners of these billions of daily democratic votes rise to the top and losers die out.
The meme that the market system is democratic is strange to me. It's not a dictatorship, but it's odd to claim that something is democratic when I (as a moderately well off American) have as many votes as ten less well-off people in my own country. More, if you adjust for the number of votes each person need to use to not die. The difference grows further when you consider that there are people with well over 1,000x my assets, and when you consider the global nature of the modern economy.
The definition of democracy is NOT limited to one person one vote. For instance, corporate board seats are democratic, but you only get to vote with as many shares as you own.
Not strictly, no, but there are limits. I think most people will agree that it's not a democracy when a single person controls all of the votes (dictatorship), or when a small group with usually-aligned interests controls a majority of the votes (oligarchy).
That said I think you've helped a bit with my confusion here. The point where it moves from democracy to something else is obviously not clear -- so probably the people who consider the market system to be democratic just draw that line differently from me.
> If they didn't think so, they'd still be choosing to shop at Sears and Kmart
Let's be clear: Amazon has been responsible for the shutting down of so many in-person businesses that entire product categories are can only be purchased on Amazon.
Come on. You make it sound as if Amazon started a campaign to directly shut these in-person businesses down. The reality however is more mundane and exactly what parent comment mentioned: people voted with their feet and dollars, the in-person businesses that did shut down could not adapt and we are all the better for it.
I completely agree that it was mundane and expected that's why I don't think bozos deserves to be viewed as a demigod of productivity. It was bound to happen.
Why do we have to overwork people anywhere? But certainly it shouldn't happen at Amazon, seeing as Bezos makes so much money. If not that alone, then maybe the fact that Amazon has used many unethical business practices. Unbridled capitalism and propping up the super rich (who, if they are so impressive, surely wouldn't be handicapped by having to play fair) isn't good for society as a whole.
I'm not saying we have to overwork anyone or that overworking is good. I'm pointing out that Amazon isn't where they are due to overworking people.
And capitalism as it exists today isn't even close to being "unbridled". In fact many have good arguments that it's far too bridled in terms of tariffs and import quotas and price controls and so on and so forth.
> I'm pointing out that Amazon isn't where they are due to overworking people.
I don't know enough to weigh in on if this was a thing in past Amazon, but if Amazon isn't willing to lose, say, 5% profit to ensure that people aren't overworked, that seems to be done in bad faith. And the lost profit certainly doesn't have to come out of the manual workers' paychecks.
> And capitalism as it exists today isn't even close to being "unbridled". In fact many have good arguments that it's far too bridled in terms of tariffs and import quotas and price controls and so on and so forth.
I think it's unbridled enough if we have companies outsourcing to other countries or hiring illegal immigrants so they can pay workers a pittance, exorbitant sums spent on lobbying to preserve the environment-negative status quo and whatnot, anti-competitive behavior leading to monopolies/oligopolies, and Boeing planes having fatal malfunctions because executives know how to build planes, I guess? (Hint: they clearly don't.) Oh, but the bottom line will be harmed. My bad, I guess we should continue overpaying executives and heaping negative externalities onto consumers and broader society.
Maybe that isn't all what you personally think, but clearly a "profit at all costs" model has huge ramifications. You pretty much have to abandon your morals to become a person who comes out on top of the system.
He built a company employing over a million people, created novel goods and services, including services my job depends on (AWS).
The wealth of a man like Bezos isn't a pile of gold he wallows in like Scrooge McDuck, it exists in his shareholder control of a vast set of companies full of employees and doing productive work. These companies would not exist without his ability to identify new markets, build efficient companies, and raise capital and deploy it effectively.
Take away the ability to do that, and who is going to found the new companies? Who is going to fund and control them? Who is going to identify the new goods and services of the future, and make them happen?
There is an alternative, and that's run the economy as a bureaucratic extension of government. Run companies as extensions of government departments and place economic planning under political control. It's been tried over and over.
> He built a company employing over a million people, created novel goods and services, including services my job depends on (AWS).
And if Bezos had not founded Amazon, you and others would have been unemployed and poor?
> Take away the ability to do that, and who is going to found the new companies?
Other people. There are many people who are driven by their non-financial passions that would benefit society. History is full of philosophers, mathematicians, scientists, doctors who weren't after money, yet managed to contribute more than Bezos ever could.
> And if Bezos had not founded Amazon, you and others would have been unemployed and poor?
If nobody founded companies like Amazon, yes many more people would be unemployed and poor.
Bezos is just one example.
> History is full of philosophers, mathematicians, scientists, doctors who weren't after money, yet managed to contribute more than Bezos ever could.
If all the philosophers, mathematicians and scientists and doctors were put in charge of running all the world's companies, we'd be in big trouble. Totally different skill sets.
> If all the philosophers, mathematicians and scientists and doctors were put in charge of running all the world's companies, we'd be in big trouble. Totally different skill sets.
Eh, worked well enough for Singapore.
Also it worked well enough for the founding of many great companies.
Ford, GE, Intel, Microsoft, Google, companies started by people who were experts in their field.
Traditionally that is how things went. Sadly the meme of a dedicated management class has taken hold on America and we've decided that people who actually understand what a business does aren't needed to run the business.
That leads to crap like airplanes falling apart, software companies who are just barely able to release software, and hospitals that are so misran they are unable to afford actually treating patients.
I think GP is saying that the people who choose to work directly as philosophers, mathematicians, scientists, and doctors and the people who choose to take the risk of hiring other philosophers, mathematicians, scientists, and doctors for some greater endeavor have importantly different skill sets, nevermind if the risk taker is a philosopher, mathematician, scientist, or doctor themself.
Workers created all those things not Jeff Bezos. A lot of the services and technologies leveraged by AWS are created via open source projects for example PostGres.
And in addition, if we grant the idea that Bezos created those things, it was not the super rich Bezos we have today who did. The parent commenter is arguing for the existence of a Jeff Bezos who is not the Jeff Bezos who exists today—rather they want a significantly poorer Bezos, because that is the Bezos who accomplished those feats
There are now at least five major cloud providers so something tells me it's not a 'bolt of lightning idea' and it's actually rather easy with some funding behind you.
The problem I have with extreme, gratuitous wealth, and the inequality that creates it, is that it is fundamentally anti-democratic. It is well known by anyone with a pulse that money = political power, which means those with the most money, have the most political power, and given how just how much wealth so few people in the world have now, an infinitesimally tiny fraction of the population of most democratic countries have essentially entirely captured the political apparatuses of the countries in which they reside. Meaning the interests of the majority of the people in most countries are no longer being represented by their elected officials, instead the people being elected solely represent the interest of wealthy elites who can afford to make huge political "Donations" and pay lobbyist's salaries.
I've said it before and I'll say it again, but one of the most effective changes we could make in the world is to get money out of politics, as its the only real way democracy can be put back in the hands of the people.
Well said.
I'm reminded of Professor Lawrence Lessig (of "Creative Commons" fame), whose staunch belief is that in the U.S., in order to make progress on any of the big-ticket problems we all face, we have to Fix Congress First. See https://en.m.wikipedia.org/wiki/Change_Congress
Reducing the influence of $ in politics is at the heart of the matter.
The relationship between money and political power is vastly overestimated.
In the US, the mega billionaires are hated in Washington by left and right alike. Bloomberg spent a fortune on his own campaign and didn't win a single state in the primaries.
Even if you look abroad, the billionaires are not the ones with political power. In places like Russia and China, billionaires have to suck up to the politicians or they risk getting disappeared, disbarred, or thrown from windows.
No, people don't know this. The degree of economic and historical naiveté has really skyrocketed in recent decades.
"Let's just try a planned society one more time, THIS time will be different, look how nice and kind we are!" is a perfectly reasonable statement to many educated people today.
It's really an indictment of the education system.
The reality is, we are planning our current society. It's just wrapped up in "markets are the natural order" rhetoric to obfuscate the fact that our current outcomes are intended.
You are mocking people using a false dichotomy. Complaining that some individuals shouldn't be able to control trillion in wealth don't imply a push for centrally planned economies.
It implies a central authority that has opinions on the wealth of private citizens (inappropriate) that also has the ability to act on it (dangerous) and that goes ahead and implements its utopian visions (has never not ended in utter catastrophe).
First of all, there's already much to be said on how encouraging private citizens to amass wealth at all costs is highly dangerous to society. Clearly, there are massive problems that our current model has. Second, we don't need to go for a utopia right now. Personally, I'm not a "communist" or whatever fan. I think that we can remove the negative impacts of capitalism without a crusade, through borrowing elements of those political theories. That doesn't sound half bad to me: likely feasible (if only the political will could be scrounged up), not hugely radical, and already a big boon.
What practical difference is there in your life now that Musk is worth 200B versus when he had 100B or 0B? Probably your life is actually better because there is now Starlink and Tesla and you have more options.
Let's say we can push a button and grow the economy 10% in real terms, but some rich guy like Bill Gates gets his wealth not increased 10%, but 10x. Do we press it? Next time we press it, some other billionaire gets 10x-ed.
The rational thing to do is to smash that button an infinite number of times. That button exists and is called economic growth.
We simply don't know if a different system could produce the same, because the few attempts we had were either corrupted or actively sabotaged. I'd argue if we look at China we actually can see how something other than capitalism can improve people's lives: hundreds of millions raised out of poverty through basic planning.
Another aspect is that many of the issues with previous attempts at something other than capitalism happened without the technology we have today. This would change everything.
> The rational thing to do is to smash that button an infinite number of times. That button exists and is called economic growth.
Of course it would be if there were zero bad consequences from it. But every time you press that button more people starve, the planet dies faster, workers conditions deteriorate, more people go homeless and so on.
But the big issue with your entire premise is that growing the economy means we improve people's lives. That's exactly the issue with the wealth gap: it doesn't. The economy right now basically only grows for the rich, not for everyone else. It's always money being siphoned from the bottom into the top.
It's very easy to pretend that everything is alright when you are in a privileged position, but the main reason 1st world countries like the US "grow" is by exploiting the poorer countries. You get access to better living standards at the cost of child labor in another country, deforestation, workers without a living wage or all the other nastiness that we don't want to know about.
There's no free lunch. It's the same siphoning of wealth, at all levels.
There is no free lunch, but intelligence comes damn close.
Monkeys living in a cave could drastically improve their lives by banging rocks together and making simple tools. Another big improvement comes from fire. Again when the rocks are stacked into buildings. By having more rocks, and arranging them more intelligently, we can hugely improve life. This is economic growth.
Your arguments against growth fail: first you say “other systems” (they all suck because they all have one thing in common - they are planned) can cause growth just as well as capitalism. Second you say growth is bad because the environment. Third you say that only rich people get the growth anyway. Fourth you say growth comes from siphoning wealth from the poor.
Well, I have news for you. The people who benefit most from growth are the poor. In my native Africa, there are millions of babies who are currently not dead due to economic growth:
- the state left the farmer alone for five whole minutes and it turns out he managed to grow some actual food when he didn’t have to pay so many bribes, taxes, and obey 1000 regulations
- technology improved business and trade, so mom and dad can buy food now
- some guy named Bill Gates donated mosquito nets and medicine and genetically modified crops that have all the vitamins.
Your ideas are rooted in ancient, pre-growth economic models. Poor people simply aren’t a good source of wealth; otherwise why aren’t dictators who do seize their wealth from the poor indredibly rich & celebrated? Why are Bezos and Musk and Gates the richest? They are producers, not seizers.
> they all suck because they all have one thing in common - they are planned
I suggest you read The Republic of Walmart [1]. Every big corporation in existence works with planned systems. Every. Single. One. That argument is a fantasy repeated by people that never truly thought/read about it.
Most people read somewhere that the USSR failed because of their planned economies, therefore it doesn't work. They had so much more going wrong that simplifying why they failed with "planned economy" is preposterous.
Not to mention capitalists conveniently forget all of the failed capitalist experiments. Perhaps because now the bigger capitalist countries benefit from exploiting those same countries.
From all the answers I've seen you give in this thread, it's clear you're very deep into the capitalist mindset. It really seems you don't even attempt to consider alternatives. You have your winner and everything is a confirmation of that. I would earnestly ask you to reconsider your position. Really read up on the subject.
There is no perfect solution, but the current one is absolutely unsustainable by definition. There is no infinite growth, and the pursuit of it has now reached the point where it only harms everyone that is not at the top. We could save the planet, we could house all the homeless, we could end famine, but we choose not to because it's not profitable. I personally can't look at that and think: that looks reasonable.
I can't speak for GP, but I'm not shooting for communism or whatever, just whatever variant of capitalism doesn't have all the horrible effects. So no, deviating from capitalism doesn't mean we will have catastrophic consequences.
> In my native Africa, there are millions of babies who are currently not dead due to economic growth:
And that's great! But it's not a given, and global climate change also has a huge impact on geographies. And clearly, Mr. Beast was actually doing something when he paid for a bunch of wells to be built in Africa. The wells don't just come out from economic growth magically, unless maybe if you wait fifty years and more people die in the meantime. Mr. Beast is rich, which is why he could have wells built.
Saying that capitalism promotes economic growth may be true, and saying that economic growth lifts everyone up may be true, but the timescales and proportions don't match up to what many would consider fair, and our current model of capitalism isn't necessary for economic growth. That economic growth has benefitted them is less a boon of capitalism than of economic growth in general, so don't conflate the two. Also, should we talk about all the people in Africa and elsewhere who are employed at a pittance to make clothes, harvest crops, and sift through AI training data?
> Why are Bezos and Musk and Gates the richest? They are producers, not seizers.
Bill Gates (and Steve Jobs) profitting from the work of people at Xerox. Maybe not outright theft, but they're clearly not tech gods who somehow had everything planned out.
Don't have a source for this right now, but Amazon has used many underhanded business practices involving driving other businesses out of town. It's also a thing Walmart was known for.
The details emerald mine stuff seem hard to discern, so take that with a grain of salt.
I'm not saying that Bezos, Musk, or Gates have done nothing useful and they're just lucky all the way. At least Bezos and Gates, I acknowledge that they did had an entrepreneurial spirit and could grasp their opportunities well. But people who have a lot of money or are in a wealthier country have an outsized proportion to people who don't, there are numerous instances of unscrupulous business practices, blah blah. To say that they are producers is right, but they aren't the pinnacle of human excellence. People who were oppressed and live in squalor, people whose inventions are taken without due credit, people who are expendable laborers. Bezos, Musk, Gates aren't merely a product of themselves and their wit. They were already placed above most due to the circumstances of society, and as they succeeded more they gained disproportionately more power to continue climbing up.
If there was such a button that had no side effects, perhaps it would be best to press it infinitely, as you say. But clearly "economic growth" doesn't lift everyone up equally. Somehow, there are still many poor people even in the US. Or take the average person in the entire world. Are they better off because of Starlink. Can Starlink solve world hunger? Cancer? What world changing breakthrough does it accomplish that makes the likes of Elon Musk untouchable? On HN, the community is fairly insular to people who already have many means and opportunities.
> But clearly "economic growth" doesn't lift everyone up equally
That’s right there in my premise! So what? It lifts up everyone a little bit; most people a lot; and one or two get boosted to orbit for a generation or so.
Your arguments against Starlink are so silly I struggle to believe someone typed them into this site. Don’t you think one more internet option for most of the globe is a good thing? And yes, it directly addresses both hunger and cancer through better internet, more research, a bigger economy, connected tractors. It’sneven helping Ukraine defend itself against another totalitarian state right now.
None of which is relevant. It’s another internet option and therefore a good thing in and of itself. You don’t even have to like it or use it for it to make your life better.
> It lifts up everyone a little bit; most people a lot;
No, it doesn't. It helps the people who are lucky enough to already have one foot in the race. But that's not remotely everyone.
> directly addresses both hunger and cancer through better internet, more research, a bigger economy, connected tractors.
Perhaps, although that's not really "directly". But then you're saying that we need to allow multi-billionaires in order to have things like Starlink. How about we stop ISPs from being stingy with their money and suddenly we don't need to rely on one rich person to save us from the other rich people? You seem to think that if the government takes some control/wealth out of the hands of these people, we're suddenly going to have stagnation. I don't see why it has to be all-or-nothing; we don't have to implement scary, spooky communism. You know what I think is even better than having Starlink? If we had Starlink and we didn't have exploitative, ruthless businesses that led to needing to have Starlink as it is now. It would just be the new technology that Comcast or Verizon made, without the weird "Elon Musk will save us all" fanfare.
In my Former Soviet Country, this is a fairly common thing that (sensible) older generation intellectuals remind to Gen Y/Gen Z lefties. There was a short period of "dude, communism is quite hip" in some circles roughly a decade ago, but this seemed more like an overblown, cynical nostalgic game, because we still have Soviet era artifacts lying around everywhere.
As of today, I think Russia's idiotic invasion to Ukraine has destroyed those mind-games of a functioning society with very strong central planning. Even if it might truly include thoughtful, interesting ideas in countries that by now have a long, unbroken tradition with democracy, I guess people of the former Soviet Bloc are extra careful these days. YMMV, of course.
Organized by an employer, capital, and management. The orchestration, decision making, done well, is the difference between a highly valuable well functioning company, and dysfunctional paralysis. There are now multiple examples in history (pre-1989 Poland, Soviet Union, DPRK, etc.) that show the communal ownership of industry by labor does not create a high standard of living, enabled by plentiful goods, services, and innovation.
At what point was labor communally owning industry in the Soviet Union or DPRK? Did Stalin or Kim ever ask a laborer for their opinion on how a factory should be run? Or give them a penny of the work they were doing?
The Soviet block and DPRK was exactly as close to socialism as it was to democracy: 100% in their propaganda, 0% in reality. Or would you say democracy doesn't work because the Democratic People's Republic of Korea is a shit show country despite being "democratic"?
The problem with collectivism is less with collectivism as platonic ideal (which has a lot of romantic appeal), and more with the inevitable concentration of power it requires and thereby enables.
The reason there has been no successful implementation of it is that the process of enacting it is inherently fragile. And some bastard is going to exploit that fragility.
Then you're screwed and we end up with the bountiful historical examples that people love to cite & then others refute as "that's not real xyz-ism".
You're absolutely correct that they're not "real" xyz-ism. And that should make you very worried about supporting something that has the same or similar end goals as those initiatives once had.
We have little to no idea if this is indeed inevitable. The same kind of arguments could have been made, and were in fact made, about democracy and capitalism before the American and French revolutions. And some attempts at democratic revolutions have indeed fallen into authoritarian rule - Cromwell's being one of the most well known.
Socialism is nothing more than extending democracy beyond the state to the workplace. It is no more collectivist than democracy is in any other economic system. And like any other form of democracy, it is naturally opposed to authoritarian rule, not conducive to it.
As such, the problem with socialism is not at all that it's easy for it to fall into dictatorship. The problem is that it is hard to convince the rich to allow it to form without aggression, since it necessitates them losing much of their power. The same problem that democracy faced: kings rarely step down, and bloody revolutions are typically worse than the status quo (and you can never be sure what will happen after one).
This concept that there is a well defined polar opposite to western “freedom” capitalism is so far from reality in literally any economic history understanding
Not only that but the USSR was in no sense Marxist Communist. It was well known that the Lenin-Trotskyist Bolshevism was the core, specifically the command economy part.
That regime coopted the philosophy of Marxism well after his death.
That’s what happens when both sides are spinning the same propaganda.
BTW I’m equally not a fan of Marxist material dialectic as I am the trotsy-lenin unholiness or the American oligopolies.
We need a true state-free attempt at anarcho socialism but that’s nearly impossible as such a concept fundamentally threatens the basic structure of the modern state.
While I am sympathetic to the idea that we need to burn e everything down, baby steps, first. If we're talking halfway realistic changes, let's get stuff like this wealth limit in place first, and once those been established for a while, we may have a better picture of the ideal state.
I can understand how you can assume catastrophic intent on my part however, that’s not the case.
In no revolution are the poorest and weakest persons ever benefited it’s only typically been to the benefit of some small group they just recycles hands so in fact, the last thing I want is some kind of hard break.
No, I’m an anarcho syndicalist. Which is a gradual reappropriation of the means to worker collectives slowly and peacefully.
Sorry for the mischaracterization. Your position sounds interesting. When it comes to how the means of production should be structured, I envision a microkernel kind of model: enforce strict protections for worker pay, fairness, and whatever, and let the dice fall where they may. If it's worker collectives that result as the optimum, so be it.
That’s the core conceit of anarcho syndicalism - to own the fruits of your own labor amd it not be intermediated or alienated by anything which reappropriates the capture of value.
So for example, if I own a table saw and my neighbor doesn’t and needed one for his labor, anarcho-syndicalism would suggest that if my saw was not planning to be used for a day, and he uses it for a day of creation, then the neighbor owns 100% of the resulting value. Much like if you rented a tool from Home Depot.
That makes sense and there’s no reason to believe that simply because I own a fallow tool, would benefit even equally from the labor.
Now look at how companies are created they are created in such a way that 100% of the value is retained by the organization and labor does not get to set its own rate. It Hass to simply be responsive to the rate offered by the organization decoupled from an alienated from, the labor that I’m inputting into it.
This isn’t accidental it’s a type of accounting that assumes labor inputs are not valued based on the productivity outcome they are simply, and only based on the relative bargaining power of the respective organizations.
This is why you see corporations, so aggressively fight the concept of collective bargaining because it creates the power dynamic that is actually appropriate for equitable relief, but reduces the amount that the more powerful organization can determine the relationship between the less powerful individual.
So anarcho-syndicalism is really about ensuring the individual worker cannot be put into a position of deprivation or suffering such that they have so little relative bargaining power in labor production that they can only choose between oppressive tyrants.
The key fallacy that people love here is that it’s all about relative deprivation so people have exceptionally varied views on what is considered oppressive or what a lifestyle would look like that is, let’s say inequitable.
Often times and you’ll see in many threads is the argument that “Actually we’re objectively more comfortable and well off that really, you shouldn’t be complaining about anything because you’re not starving to death”
The problem here is that it’s a completely separate argument than the argument for long term concentration of power, and who is actually controlling the economy, and has the ability to be flexible and create a life free of intermediaries that are confiscating your labor.
It all comes back to who has the power to set their own destiny in the economy, and the reality is, it’s always been small groups of exploiters who are able to do whatever they want to do because they’re taking advantage of the relative deprivation around them to not make things actively better for everybody. The people in situations like this, take no responsibility for their surroundings, their community their environment, they simply say how do I take advantage of this environment to my own best ends, and if that is the foundational conceit of a society, then you will not have a society that long and history tells us that society is built on this go through this political cycle, which so far has been basically every society in recorded history, unfortunately.
Anyway, there’s a lot of Intersectionality here with, for example, global finance, how this got really amplified after Bretton Woods two and the kind of fiatization, and then financialation of all possible value so there’s a giant kind of systematic thing here that is encoded in a lot of these as foundational assumptions in western capitalist economics.
East Germany, North Korea, and the USSR are wonderful examples of how this idiotic idea fares in real life.
Unless people there somehow have much lower IQs than their neighbours, who do vastly better, the difference in outcome must lie in the system that co-ordinates their work.
Look at each valuable item that you use often, now look up the salary of the leader of the company that made it.
Edit: You wouldn't have that item without that compensation. This should be more traumatic than people make it out to be. You wouldn't have your iphones, twitters, facebooks, vr goggles, steams, ikea tables, etc.
And yet, all of those examples are critically dependent on huge pieces of infrastructure created and distributed for free by people motivated simply by craftsmanship - Linux, the BSD kernels and many other similar things.
These two ideas are not in conflict. You can create something and give it away free, or you can ask money. Many SWEs do both - eg. open-source for fun, proprietary at work.
You're giving a preposterous amount of credit to executives for the value that is mostly being created by the lower level workers. So, if every CxO-level leader in the world disappeared tomorrow (or if their compensations simply got capped arbitrarily), nothing would get built ever again?
Successful companies are mostly that due to having made the right business decisions, these come mostly top down. You can have a million workers, but if they don't have great leadership they'll produce basically nothing of great value.
CEO pay in America was forced to be made transparent by Congressional law.
Shortly thereafter CEO pay started to skyrocket. There's no evidence CEOs started doing a 10x better job running companies but their pay sure as heck increased, 10x then 100x!
Countless studies have shown that workers are not motivated by money beyond around low six figures.
There is no reason to suspect a CEO earning $100 million is 100 times more dedicated to the job than one earning $1 million dollars.
You wouldn't have those items without that compensation. This should be more traumatic than people make it out to be. You wouldn't have your iphones, twitters, facebooks, vr goggles, steams, ikea tables, etc.
And it’s easy to argue (EDIT: more like assert without evidence) that cherry-picked aspects of the status quo for the last forty years is the linchpin of everything.
What are you talking about? Let's have every worker stop doing their jobs. I'm sure those company leaders will continue to produce great products on their own.
They're actively destroying jobs at this very moment, not creating them. If I had a nickel for every "we're making record profits, oh and we're also laying off 10% of our employees" announcement, I'd be a billionaire.
That doesn't measure underemployment, nor does it measure people who've given up on finding work. That's why it needs to be considered alongside things like the labor force participation rate - which has been on a downward trend since 2000 - and alongside wage growth, which has lagged below inflation since the 70's.
> January 2024 saw the most growth followed closely by December 2023.
Which jobs, specifically? At what pay? Destroying a $50k/year job to create two $25k/year jobs ain't progress.
Labor force participation rate has been rising since COVID. The long term trend is down but not so bad. A decade ago the rate among adult men was 72% while last month it was 70.2% and continuing to rise. https://www.bls.gov/charts/employment-situation/civilian-lab...
Well then I guess we'll see if the trend actually reverses or if it corrects back to how it's been since the 70's. Barring some significant systemic reforms I ain't exactly holding my breath.
Unfortunately unemployment numbers don't mean shit if you still can't even pay your rent with your salary.
This focus on unemployment is absurd. It has nothing to do with the wealth gap.
More people working, but always with less wealth, while companies keep getting richer.
We could as a society literally end unemployment at any time by redistributing some of the wealth. We don't because it's more profitable to have people worrying if they will be able to eat every month.
You are looking at a too short of a time frame. Expecting a system to be getting strictly better every second of every day is utopian. The real world has ups and downs, restructuring to accommodate change, shutting down legacy industries, making room for new ideas, etc
Wage growth has lagged behind inflation and cost of living since the 70's. There have been multiple job market crashes in my lifetime; I entered the workforce in the middle of the 2008 recession. There have been multiple layoff waves since COVID alone, during each of which companies would lay off significant fractions of their workforce despite making record profits for no discernible reason other than "well everyone else is doing it so we'll do it, too". How much longer of a time frame do you expect me to examine?
> Expecting a system to be getting strictly better every second of every day is utopian.
Employers have been increasingly shafting their employees for decades. I expect a system to not spend multiple decades getting worse.
> shutting down legacy industries
My last two jobs were as a cloud infrastructure engineer. If even cloud computing is a "legacy industry" then the vast majority of the users on this website are utterly screwed.
Your usage of the word "hoarding" implies a Scrooge McDuck view of wealth where its just stashed away in some vault - never put to use. Yet nothing could be further from the truth.
My mental image is one of unelected, untouchable oligarchs taking actions that they're accountable to nobody for. That's far worse than Scrooge McDuck.
That's not the same thing as hoarding. It's always the case that the wealth of even unelected untouchable oligarchs is comprised of productive assets, not hoarded in a secret pile.
So you're imagining President Xi and the House of Saud, I take it? As long as you aren't imagining someone like Elon Musk who is certainly accountable to his debtors and shareholders and Boards, then this can be viewed as a realistic take.
If you're talking about people like Elon Musk and Bill Gates who have giant wealth because of their investments in businesses, then arguing that they should have that wealth taken away would literally take money out of the coffers of businesses that are currently using that money for things like payroll.
The GP is correct -- these people are not sitting around on a vault of gold like McDuck. Their money is in the economy, doing stuff. That's what investments are. That's why investors exist, and why they get a cut of the profit for taking a risk and lending their money to industry.
This is the same mistake Lawrence Van Dough makes in Richie Rich. He assumes the massive vault must be full of gold bars and diamonds, the wealth of the family. But it's not. It's invested in banks and stocks etc. The money is not just sitting there, it's producing other activity in the economy.
As I understand it, very few entrepreneurs ever said “this is interesting but if I can’t be a billionaire what’s the point?”.
Which are the examples driven by extreme wealth (note: not just regular 1%er wealth and not people who became extremely wealthy - I mean people who expressed that the reason they created something was because they knew it would make them extremely top-0.01% wealthy)?
> When you hard cap them in any measurable way, they stop.
No they don't.
Satya has a much lower cap earning money at Microsoft then Bill or Balmer did.
Does that make him a worse CEO? Does it mean he is less dedicated?
Very few people who are competitive are competitive because of money.
They want to be known as the best, have the most power, the most influence, run the largest company, their name the most number of history books.
Money is a rough proxy for power, but, to give an example, pharmaceutical companies have an outsized influence in American politics versus how much their CEOs are worth.
Heck for the vast majority of companies their leadership has 0% chance of becoming billionaires. Most industries are too low margin. That doesn't mean the leaders of those companies still don't want to win in their chosen market.
This sounds like guesswork around peoples motivation. Not saying you are wrong, but I'm making the argument that this is a pretty big claim (people being motivated not by wealth or status or curiosity but by extreme wealth). I just don't buy this claim. I don't think it's been a motivation of anyone who has made (say) a billion dollars, to only make another billion. Perhaps be the biggest company or invent the greatest product or have more money than the other billionaire who is an asshat, but just the money itself. Never heard of that. Every billionaire since the dawn of time has written memoirs. They might be lying, but I doubt any of them said "After 150M I just felt I had to make another 500M". They all say "after making successful product A and being set for life, I really wanted to make thing B". I have not read all the billionaire memoirs, and I'm sure memoirs usually claim you were in it for the thrill or the curiosity. But still.
If you pay someone to do X, and then stop paying them they will stop doing X even if they enjoyed it. The same will be true for these leaders, you can't just take all their future wealth and expect them to continue, they will stop the instant they stop making money, just like any other person.
> If you pay someone to do X, and then stop paying them they will stop doing X even if they enjoyed it
That's because for 99.999% of people, being paid money has utility. So the payment provides some benefit for them. But for someone with $2B, my argument is precisely this: whatever it is that drove them to make $2B (inveting the best product, or whatever) is NOT what drives them to make the NEXT $1B.
> you can't just take all their future wealth and expect them to continue
> they will stop the instant they stop making money, just like any other person.
You cabsolutely can, and they absoluteluy will not.
That's the whole point again: assuming a high enough "cap", we are talking about people who will never not be extremely wealthy. Whether the cap is $100M; $1B or $10B can be argued, but the central point is that the utility of more wealth is diminishing. That's why me giving you $1B would make a massive difference, but then me giving you another $1B would make almost no difference to your lifestyle/happniess/whatever measure you choose.
I had a lucky exit and no longer need to work. I now only consider working on something if it could increase my net worth by an order of magnitude or so — because if it won’t make me a billionaire why bother working?
I’d rather do art or open source or go fishing.
(That’s not quite what you asked but I don’t know how many actual billionaires will read your comment so figured I’d chime in — to me it doesn’t seem unreasonable that calling wealth would change what people work on and how much they produce.)
Are you suggesting Edison would have invented everything he did if he wasn't allowed to get rich? You chose an extremely funny example if that's what you're trying to say.
Edison was famous for caring about money more than other inventors. One of his most famous quotes was “Anything that won't sell, I don't want to invent. Its sale is proof of utility, and utility is success.” The guy helped found some of the largest companies of his era and died as one of the richest men in the world.
So he would have stopped after 10% (random ratio) of his inventions. Or probably not started at all if there was a cap he knows he would reach very quickly.
Can't wait to replace starlink with a new take on back yard furnaces. This is just a re-marketing of the same socialist ideas that have empirically failed every time.
People with positive inability to create wealth self-appoint to control the people that have demonstrable ability to create wealth. Doing so is the only way for the former to end up in control of wealth, again because they are incapable of generating it themselves.
It's a bit amusing that no one about the commie paradox - the group of people that profess the greatest ability to central plan and redistribute wealth is entirely devoid of individuals with a track record of creating wealth. A reasonable person would expect a strong correlation there.
There’s a lot of comments in here straw manning a book that I would guess very few have actually read. I don’t know if it’s a good argument or not but I’m sure the author is intelligent enough to have considered incentives and the case of central planning in the USSR and it’s not dunking on the author to just blindly bring these cases up as if they disqualify their whole argument. If this three paragraph summary of a 300 page book is so enraging then there’s maybe some deep seated biases to confront first.
Approximately no one commenting here has read the book; it's only been out for a day, and while I'm a big fan of "actually read the fucking article before commenting", expecting people to purchase and read an entire book before commenting is a bit much.
IMHO this is a bad submission; not because the book or the premise of it is good or bad, but because all most of us can do is discus the title and (very) brief premise.
Yeah that’s a fair point. It would be much more valuable to at least wait until someone in the world has had a chance to read the book and post a more detailed review of it. As it stands right now there’s nothing to talk about now other than the boogeymen we invent in our mind of the people who have the opposite stance on this than us.
I honestly wouldn’t be surprised if someone involved with marketing the book posted this knowing that it would provoke some kind of response from the community.
We should place a hard cap on political ambitions like these. These utopians will be the end of us with their ridiculous schemes involving always what other people should do.
I don't understand why we celebrate the (false) utopian ambitions of the rich who very much make decisions for other people - coercively too bc we need to eat (and they also use lawsuits, media, govt, and assassinations if you cross them).
I didn't say "ban the idea". I said "ban the ambition to control the lives of others".
The best counter to these jumped-up mini-Mao's is to spread the power far and wide; to have lots of little decision-makers rather than a few grand ones; to have those little decision-makers make tons of small but important decisions every day, rather than trusting everything to one election every few years.
I think that the description ’mini-Mao’ fits both the ambition to blocking others from excess wealth and the behaviour we are seeing from some billionaires. Extremes promote extremes.
Getting lots of people to make lots of small decisions is not easy and the masses are not necessarily that sensible. Delegating decision making to a chosen representative is the least bad system seen so far, but has a way to go.
That’s not quite what I meant but is exactly what I said. I include myself in the masses. I want smart people to decide things for me. I don’t know how to negotiate trade deals, infrastructure projects and a fleet of other things. Short term leaders and changed objectives mess with progress.
I want someone to who understands to make good decisions, and the ability to remove them if they start failing. How that’s best done from my perspective is with an electoral cycle that’s fine tuned such that results can be achieved, but that incumbents can’t rest.
A lot of these collective decisions aren't even needed but are simply the consequence of runaway states having to make all sorts calls on behalf of regular people because they've inserted themselves into everyday life in a million different ways.
For the few collective decisions that really do have to be made, regular elections are the only way to keep the decision-makers on their toes.
> Getting lots of people to make lots of small decisions is not easy and the masses are not necessarily that sensible. Delegating decision making to a chosen representative is the least bad system seen so far, but has a way to go.
I'm with William F. Buckley on this one:
> “I would rather be governed by the first 2,000 people in the telephone directory,” he said, “than by the Harvard University faculty.”
One ancient form of democracy was to draw lots and the unlucky winners had to go and be the senate for a term. I kind of like it! Like jury duty, but you have to run the country. It can work if you draw enough lots.
When you say "billionaire utopian" a couple of people spring to mind:
- Bezos
- Musk
- et al
These can be removed by market power, even during their own lifetimes. I bet you anything that in a generation or two, their fortune will be mostly dissipated.
The vast majority of rich people are much less rich than these two; their money will dissipate even quicker. Most of them made their fortunes in their own lifetimes; many will lose it in the same timeframe. They have to keep performing economically (work + investment) to keep their money.
But: I will also bet you anything that in a generation or two, the state will be larger than it is today, and will have assigned to itself more rights and prerogatives, and will somehow have inserted itself into our daily lives in an even more intimate way, whether anybody likes it or not.
*Whom did
I suppose some people would say all of the workers who manufactured the glue and binding for the books and harvest the trees that constitute the books, and the truck drivers and ship captains who sent her books around the world. The causality is beyond me, but if I could steel man someone on that side of the argument, I think it’s that
If she made most of her money from ebooks would she be stealing it from Michael Hart, the inventor of .epub file format? Or what? At some point we have to admit this is ridiculous.
Life is a game. If basketball rules sucked, far less would play and definitely not at its current scale. If you block the game of capitalism you stunt all of the growth and innovation that comes with it. It’s how people tick.
Sure you have similarities with a competitive game and life, but that's simply not enough to say that they're the same. People can and will do things in games that you don't do in life because... it's just a game.
> If you block the game of capitalism you stunt all of the growth and innovation that comes with it. It’s how people tick.
Where's the evidence for that? People help each other much more than they hurt each other, despite the common perception. What kind of sucker helps his adversaries?
Because a few people with power want to exploit everyone else, we somehow assume that everyone is like that. It's simply not true.
When we keep reinforcing these "winner takes all" scenarios we're playing into the hands of those few that truly believe that's how the world works. People cooperate and we only got here in the first place was through cooperation. If this capitalism mentality existed back then, our species would have simply died. Now we survived, thrived and forgot that our real strength is in communities, not individuals.
The individualist capitalism mentality got people with hook, line and sinker. Most can't even comprehend that there are different ways.
> People help each other much more than they hurt each other, despite the common perception. What kind of sucker helps his adversaries?
Is just as true within capitalism as communism, for example. Likewise feudalism, theocracy, anarchy.
> People cooperate and we only got here in the first place was through cooperation.
Yes.
> If this capitalism mentality existed back then, our species would have simply died.
No.
Why did I split these two up like this? Because capitalism only functions through cooperation (hence the etymology of "corporations"); and because "winner-takes-all" was the dominant behaviour that our species has displayed as far back as archeology shows, with our God-kings, slavery, and evidence of mass brutality before the invention of writing.
Extreme wealth is a symptom of an underlying problem - inhumane exploitation. People can get that rich because the economic system says that it is perfectly acceptable for a class of people to pee in bottles/diapers in order to maximize profits.
The solution for this doesn't have to target the rich explicitly. We can strengthen labor laws; update anti-monopoly laws. Make human dignity the central argument.
This will circumvent knee jerk reactions like "I work hard, I deserve to be rich". The question to ask is how are you, as an owner of capital, treating your labor? Like do they get to have a life after work? Have dignity at work? Do you use your wealth to circumvent democratic will and weaken labor protections? The answers to those questions should determine whether you deserve your wealth or not.
Measurably untrue for equity ownership which is a prerequisite for “wealth” in that you need to have undifferentiated ownership of assets that increase in value.
Equity in a for profit corporation is fixed to the current round of funding with theoretical increases at certain intervals. These increases very specifically reduce the existing size of the “wedge of the pie” - aka takes from and redistributes ownership in the new pie size. This is called “Dilution” and we’re just told it’s how the game works.
Note that the theoretical expectation is that the overall “value” stays the same despite literally being called “less than.” However, we know that those valuations are not rooted in any type of mathematical or otherwise natural function like let’s say the gravitational constant, that is unchanged and unmoved by exogenous circumstances, therefore the fact of splitting the pie Redistributes functional ownership, irrespective of what the value theoretically is.
you’ll also note that the specific function of private equity is to ensure the retention and growth of equity ownership over all goals. So specific to the mechanisms within the commerce system, specifically ownership, they are not only functionally but mathematically zero-sum.
Clearly wealth can be zero sum, and it can be varying shades of grey.
When employees of a small business see their company tank while being forced to hold their shares for a year under a SPAC acquisition, while the founders and SPAC sell at a overvalued projected cost — nothing productive results and who holds the sum? I’d wager a number of people here have experienced that personally.
Most wealth is not derived from exploitive labor practices. The poor developers being shackled and slavedriven at Meta put $150 billion in Zuckerbergs pocket? Absurd.
You are correct, economic activity under capitalism is positive-sum. And that makes the exploitative behavior of megacorporations and their leaders that much worse. The economic pie is growing rapidly, but ruthless cost-focused management that treats employees as "resources" keeps unskilled laborers continually on the edge.
The larger the organization, the more the leaders can insulate themselves from the human reality on the ground, which in turn makes it easier to justify policies that fail to treat workers with basic human decency, let alone provide them the opportunity to share in the the economic surplus they produce.
It takes work and discipline for leaders to avoid this without external coercion, and that is in demonstrably short supply.
You know that not every company is Amazon, right? You can't just generalize those terrible experiences to every company.
I happen to agree that there needs to be some big legal changes to ensure workers at Amazon and other companies are treated better, because before Amazon it was Walmart, and in 50 years it'll probably be another company. But that doesn't mean you can use Amazon as a reason to legislate personal wealth away.
I'm not singling out any one company. Walmart did indeed pioneer labor exploitation. Amazon just made it more efficient. Facebook, Google got rich off surveilling users and eroding user privacy rights. Focusing on some specific companies serves to obfuscate the fact that this is an exploitative economy built up over decades with policies that weakened society at large. A relatively tiny section of society became powerful enough to rearrange society to their benefit.
Bring up the topic of central planning and you'll have everyone pointing out the folly of putting all the power in the hands of a few people. Our corporation ruled society is not that far off from a centrally planned dystopia. Instead of patting our backs comparing ourselves to the communist bloc, we need to focus on the technology we have today and what possibilities the technology could have opened up, and ask why the said possibilities haven't become a reality.
> But if the rich become richer, there is nothing much to see in public and, for most of us, daily life doesn't change.
This is exactly why I don't really care how rich Elon, Gates, Bezos, Buffett are. If they have money, great... If they don't... oh well. Doesn't change my life. It's also the reason why you shouldn't care and why this book is likely a load of crock.
I wonder if this book have a solution how to motivate people working more and creating companies if it does not make you rich.
Certainly a lot of people among most driven would work less or emigrate. If I can't earn more, I would work that's most joyful and relaxed. So, no banking or any other demanding job where there are a lot of rules.
I’m not extremely wealthy so can’t spend 20 pounds on this but I imagine I would agree with the moral argument for limiting wealth. But the details make the whole discussion seem like an absurd waste of intellect.
Please, just name the people who you want to “wealth limit” and explain how you will go about it. Specifically address the obvious problem: wealth gets distributed across families and other groups in such a way as to make it impossible to even count let alone try to limit. If it could be done, it would have been done. Digital currency shouldn’t be the impetus to relearn governance mistakes of the past.
Once you understand the problem is not a should or shouldn’t problem, but a how is it possible to problem you quickly realize the answer is more individual freedom.
I am not paying 20£ to read am article and i dont see an archive link, so i am flying blind but here goes: the fundamental problem with all these types of articles and so i assume also with this one is as follows: govermment is not better than private wealth, it is just a different group of assholes interfering in my life. Thr problem with all of them is the interference (abuse of market power in economic terms) so lets stop crying about people being successful amd instead target market power abuse. This means severely limiting government but also empowering government to much more easily break up market power abusing companies (i.e most of the s&p 500 plus a bunch of large private companies).
A US politician said no one deserved to be a millionaire until he sold a book and became a multimillionaire. Now, he says no one deserves to be a billionaire.
We should also say no one should be devastatingly handsome or pretty, outstandingly intelligent, excessively lucky, or extraordinarily persuasive. Or tall. Or athletic. Or motivated. Or powerful (which is rather more related to limiting someone else's money).
What's the deal with Michael Phelps hogging all those medals?
Or with Taylor Swift hogging the charts? I sing in the shower - I want a record deal too!
On a smaller scale, these damn farmers are making too much money. I'm sure I can grow an orange just as well - they should be made to hand over part of their farms to me.
Same goes for all the software startups and those coders hogging the SaaS startups!
We should have regulations to limit the price of such books and how much royalties the author is receiving to make the books accessible and not make his income deviate too far from the rest of his fellow authors that don't make any money.
I think it would be great for someone or some think tank to devise a very well thought out publicized plan of how an ultra-rich person could efficiently redistribute their wealth to do a lot of good. Seems like most of what people recommend now is just "give it to charity!" but that's not exactly well-vetted advice. Or like the snarky advice downthread to just write a check to the Treasury, that's not what I'm talking about. Something constructive and efficient.
Isn't the thorough, extensive and open-source research that GiveWell does exactly what you're asking for? The amount of evidence you'd have to give to argue against "give everything following GiveWell's recommendation" as the objective and data-driven best option is extremely high.
I think the one conceptual point I'd make against this is that GiveWell seems oriented toward the person that wants to give a few hundred or few thousand here and there. Note that in their top offerings, there's no indication of how much money would be enough to solve the problem, or too much. For instance, malaria nets are about managing an existing problem rather than solving it.
A billionaire could target their money differently, like funding research or setting up labs to target their money toward solving pressing problems rather than managing them. I don't really know much about the big problems, like maybe they are all already at the point of being at the edge of unknown unknowns, where you just have to throw money at them to do exploratory research. But I'd imagine there are others that are along the lines of "we know how to solve this, it just needs funding", funding beyond what could be crowd-sourced or from your average charitable giver, and I'd like to see those opportunities in some sort of ordered list.
At this stage, I'd vote for any proposal which equalizes wealth. Limiting wealth, UBI...
The most interesting proposal I've heard recently basically suggested that instead of governments selling bonds (to the central bank and to the markets) when it creates new currency for public spending, it should essentially just give the newly created bonds to citizens since it's the people's money anyway that it's loaning out... It would have to split them equally among all citizens.
My policy proposal for reducing concentration of power is:
1) maximum revenue per employee at privately held companies, eg. $1m
2) maximum ownership of a company by a single person or entity of, say, 5%
What this means is that when you hit a good stride with a business and solve the entrepreneurial problem, you have to go public and sell your stake in it.
Everyone gets a rewarding pay day, but there is greater accountability and earlier on and more even distribution of the gains.
I often wonder how it would work out if instead inheritance, all wealth at death was deposited into the $USA$ fund, then in aggregate got redistributed as universal income (or start-up fund) to all citizens (in equal amounts), save for some moderate amount. Complications sure re property, but would it squash or enhance the economy?
One could look at things from a different perspective: All That money, like all debt, represents goods and services we collectively owe to those people.
They expect to one day buy things from us.
If we want to honor that agrement we should at least attempt to not make it worse.
Rich are getting richer but financial meltdowns happen all the time and then we are all again at the year zero and we shuffle the cards and start playing like nothing happened. In another words, richness does not last forever.
The ability to create extreme wealth in a democratic capitalist society is an indicator of the economic freedom.
It is the wealth that gives us the freedom to invest in new knowledge creation to solve problems.
The more wealth the more opportunities, especially when they are in the hands of someone who have proven again and again their ability to create value to society. Elon Musk is of course the obvious example but not the only one, Jeff Bezos, Larry and Sergey and we could go on. These people are excellent capital allocators.
The alternative to extreme wealth is extreme poverty and
Almost no one in western society gets to keep their wealth for more than 3 generations because other have the freedom to outcompete them. Everyone over time gets richer.
The alternative to that is dictatorships where there is no economic freedom, capitalist ownership and the way to make money is governed by the ruler.
Anyone making a case against extreme wealth in a society that is fairly free is spreading extremely bad ideas that if they become popular leads to revolutions.
In modern society the issue is not big corporations or extreme wealth, it's institutional capture by politicians and that entire system.
To generalize this idea further, it seems to me that at some point, concentration of wealth compromises the freedom of markets — whether by political influence or legal means. And that’s what needs to be focused on.
I've always believed that ever higher degrees of wealth come with an obligation to manage people in better and better ways. Otherwise, wealth should be taxed so that "idle rich" end up having to live like the upper-middle-class.
IE: If you get very wealthy because you start a company, and manage your company in a way to improve other peoples' lives, that's a great thing. (Now, does Elon Musk deserve 50+ billion dollars? I'll just handwave and say that I think he could still live the same kind of life, and make a better contribution to society, with a fraction of that money.)
But, if Elon's kids all inherit many billions each, they either have to manage it in a way that improves other peoples' lives, or they need to be taxed back to the upper middle class.
> I'll just handwave and say that I think he could still live the same kind of life, and make a better contribution to society, with a fraction of that money.
Elon's an interesting case because he very passionately and sincerely spends his money on what he believes are the most pressing problems facing humanity. Almost all of his wealth is invested towards those goals.
He's an asshole and treats people terribly. But he is very consistent about investing in what he believes to be most important.
Part of the handwaving is that reinvesting profits into other businesses is something I agree in. For example, compare how Musk invests his money and runs his companies to how the Beatles invested their money and ran "Apple Core."
The Beatles were horrible business operators and were essentially being taxed back to the upper middle class. I always chuckle when I listen to "Taxman."
> If no one was a millionaire, a small house in California wouldn't cost that much.
It depends how this is structured. If the limit is you can't save, this actually puts pressure on housing prices as people are looking at ways to 'productively' spend the money.
Yeah, the blurb does literally say, "No-one deserves to be a millionaire." That threshold is the wrong choice, at least with prices where they are today.
If you do the math, millionaire is just about where your assets start to balance your liabilities. By liabilities, I mean the cost of a modest and frugal life. In that fuller accounting, the millionaire is merely the freedman, the person who has climbed out of the debt-hole into which almost all of us are born.
Let's do the math.
1. A millennial can get a decent Gold PPO plan on the health insurance marketplace, including basic dental and vision, for about $500/month. Anything below Gold merely coinsures ER visits and does not actually protect against catastrophic loss.
2. If you move to a cheap city and shop around, you can rent a decent one-bedroom apartment for $1,300/month. Even in a cheaper city, it will not be new and it will not be downtown.
3. Now consider utilities. Say $30 for a cheap cell phone plan, $50 for Internet, $100 for electricity (if you have electric heat), $20 for water. That's $200/month total
4. Allow another $80/week for groceries and $100/month very-occasional minor luxuries (get lunch out, get Starbucks).
5. Finally, let's say you really hit the jackpot with apartment and job location and are able to get by with a monthly bus pass costing $50/month.
We're at $2,230/month, or $26,760/yr.
Now assume you can get a 3% real yield. To finance your $26,760 annual costs, you need $892k invested -- nearly $900k.
This analysis has assumed unusually cheap rent and lifestyle. Add in car payments for a Corolla, or a less optimistic rent, and you're quickly at $1M needed. Yet I'm still talking about living frugally. I'm also assuming no childcare expenses.
So, for those reasons, and because $1M is a nice round number, I simply summarize that $1M is actually zero.
And it's only zero in a cheap place. If you're in California with only $1M you're still in the hole.
...
Yes, there is a problem. The natural world was expropriated from us before we were born, we were born into a system we didn't choose, and we must work off an indenture we never signed up for. So I agree with much of the spirit of what the author says.
But, quantitatively, if everything else about the current system remains as it is and we are only talking about where the cap is, then $1M is too low. Because $1M is merely where assets begin to balance a single person's liabilities.
You forgot a big asset on this hypothetical balance sheet: the individual's (your) productive output over their lifetime. Until we get to a point where all existing, and all possible, human output can be done by machines at no cost to anyone, the 'indenture' is more of a reciprocal arrangement where you trade your output for others'.
The scenario you outlined is one of unimaginable privilege for most humans living today, and arguably most humans and non-human animals through history. A climate controlled, personal living space in a safe society, varied and effectively limitless food/clean water, modern conveniences like a car/internet/telephone, access to healthcare by highly-trained doctors -- completely free of drudgery and effort (i.e. work).
I like the "reciprocity" angle. Indeed, if you're consuming food &etc without contributing anything, then you're sort of a leech. That's fair.
When we go further to speak of "unimaginable privilege", then I have mixed feelings. In historical and global terms this is comparatively true. But if this comparison is simply used to scold workers when they get too uppity, then it serves another purpose.
Returning to "reciprocity" -- it might be worth pausing to ask why my imagination is limited to financial rents. If I were the baker, and I lived next door to the butcher and the candlestick-maker, then maybe I wouldn't mind making a loaf of bread and trading it for some meat or some light. (Yes, I see the predation involved in the meat -- perhaps it is inescapable -- but I will choose to gloss over it for now, privileging humans.) In this imaginary village, people have roles and trade labor, but you understand that your labor is in fact useful, and you understand who it is helping. I guess I am talking about Marx's "alienation", or lack thereof.
As a software developer, in many industries it is not clear that your work really benefits any individual person, or even society in the abstract. You perform drudgery and endure stress, but it all seems to be some terrible social game that accomplishes nothing, and you participate only because you must, to justify your existence.
So it makes sense why many software developers -- despite the flexible work arrangements, and the physically undemanding job, and the good pay -- would see work as only an evil and seek to escape it.
There has to be a way to do reasonable amounts of useful labor -- to pull your own weight -- without participating in Silicon Valley style "life".
Unfortunately, a degree of financial independence has to be an intermediate goal. But what the next step should be after that, I am not sure. For the super-rich, the answer is philanthropy. But for the yeoman programmer, it's less clear. It will need to be less grandiose than all that. It will need to continue to produce some cashflow, but it should provide understandable value to the community. I will need to think about this.
I forgot about subsidies, once your income gets that low. (Remembered that marginal tax rates would be low, at least.)
The difference between "cheap city downtown" and "expensive city downtown" is an interesting phenomenon. It isn't a hard and fast rule, but you're right about the general pattern.
It's also true that I could have aimed even lower than I did. If I'd assumed roommates in a larger apartment, I could have ended up with lower numbers.
If you really wanted to be a starving artist, you could probably get by on $1k/month. So then, as little as $400k invested plus a $30k cash cushion might suffice. It'd be pretty rough though if you were trying to pull it off in the US. Honestly we're starting to get into food-stamp territory.
I did the starving artist thing as a young man, decades ago. On one hand, there's really no limit, it's about how committed you are to this starvation thing, but on the other hand, yeah, less than $1k a month in current dollars, you're out of the joke starving artist level and into the real starving artist level.
Now I'm an old man and I'm looking at it from the other direction. Is $x amount enough to get me by until SS and Medicare. It's scary because as an old man I don't think I'm going to be able to jump back in to a software developer job once I quit. And on the other hand, the clock is ticking.
> Is $x amount enough to get me by until SS and Medicare. It's scary because as an old man I don't think I'm going to be able to jump back in to a software developer job once I quit.
Yeah, I'm not always sure whether "retirement" is a carrot held in front of us, or really a threat.
Extreme wealth is not per se a problem, or not a terribly pressing one.
The rounds to always that extreme personal and corporate wealth becomes fungible into induced market failure, is deployed exactly that way, leading to you guessed it, even more extreme personal and corporate wealth is a huge problem. It’s going to cook us even faster than carbon emissions in fact on present course.
I can see why a middling academic like Friedman, or an embittered Eastern Bloc emigre like Rand, or generations of ambitious apparatchiks and politicos have seen fit to endorse some nonsense, zero-evidence economic theories to the contrary.
As for why a community like HN that both knows better and stands to lose thereby endorses this manure?
I don’t have any better explanation than Clements on temporarily impoverished millionaires.
To do anything practical I think you'd need to distinguish between wealth as in owning a company and as in money you spend on things for yourself like houses and cars. You could make a case for limiting the second one.
The trouble with restricting owning a company type wealth is what do you do with cases like Google or Facebook where some people build a better bit of software and because people like using it the company becomes valuable? Do you just ban successful ventures? Or confiscate them? When that's been tried under communism it hasn't worked very well.
I admit I did not read the book but I must say the concept seems wrong from the root.
A person with a lot of wealth must invest his wealth in some way that it will generate jobs or invest the money in other business.
That is also a benefit for the rest. So that thing about "we cannot see" I do not think it is such.
I mean, it is easier to see poverty on poorer people BUT the wealth invested is also what makes people have incomes. And you need people investing and managing wealth because someone needs to pay bills and multi-year investments or risk capital.
It does not need to be a single person, but a group of wealthier people are usually more inclined to risk wealth than average.
The description misleads already in the second paragraph: "We all notice when the poor get poorer: when there are more rough sleepers and food bank queues start to grow."
Any product whose life span is usually much shorter than what it should be. A classic example from technology is "the new" iPhone. A classic example from clothing is "the new" Zara collection. A far bigger problem is that this manufactured want drives so much of our economy (employment mainly) while actually being ecologically unsustainable
If there’s just one nonsense idea that humanity absolutely will not let go of, it’s this one:
In anything other than the short term, you can really make yourself better off by making other people worse off. It’s a feudalist mentality that’s totally obsolete in free markets. Loads of people just continue buying this snake oil by the tankload, making themselves unhappy and unfortunate. Not a way forward.
Explain to me please - how millionaire is "extreme wealth"? Median household income in the US is about 75K. If you retire at 65 and plan to live to 85 (some live longer), you already need over a million to sustain that. That's not counting medical and care costs, and anything you want to live to your kids or charity, and anything you may spend on some fun activities like travel in those 20+ years. So how somebody who has $1M at retirement is "extremely wealthy" and "nobody deserves" it? Surely, I wouldn't call such a person poor, but "extreme" to the point that it implies some kind of deep wrongness that warrants confiscation and other extreme measures? That sounds like complete nonsense. How does it make sense?
I know there's social security, and other welfare payments, and various adjustments, but I don't see how these calculations would be so mismatched as to warrant the moniker of "extreme wealth".
> The answer to so many of the problems posed by neoliberal capitalism - and the opportunity for a vastly better world - lies in placing a hard limit on the wealth that any one person can accumulate. Because nobody deserves to be a millionaire. Not even you.
It won't cure envy.
Nearly everyone alive today is a "millionaire" compared to people living a few generations ago in terms of standard of living. Absolute standard of living continues to grow but that is invisible if you compare yourself to your peers.
It doesn't have to. The point isn't a perfect society, the point is to prevent resource hoarding and the accumulation of totalitarian power. When we allow wealth to accumulate we are also allowing power to accumulate.
The state is democratic, not absolute. When the state implements policies like this it is acting as a democratic expression of the community's will. We as a community are saying "We're not going to allow individuals within our community to accumulate undo influence over it."
Polls and studies for years have shown that what elected officials legislate and what voters want rarely line up. Modern democracy has long outgrown representing mere constituents.
Laughable - the state has been growing on a one-way trajectory: ever larger, ever more powerful. It is run by bureaucrats who look after their own interests first, and who have no feedback loop between their own performance and reality.
Think about this next time you go to the DMV or have to wait in line to see a doctor or deal with some kafkaesque snarl of paperwork. Your democratic will counts for nothing in the face of limitless state power.
It's just preventing the accumulation of a specific kind of power.
Relatively speaking this would increase the power of military generals, presidents, and criminals, for a start. Is that a good thing? maybe, but restricting power from a group needs to be assessed in terms of holistic power balance not naive platitudes like 'No one should be a millionaire/billionaire'.
> When we allow wealth to accumulate we are also allowing power to accumulate.
Like the power of JD Rockefeller and Andrew Carnegie, which was much greater than any rich man today.... oh wait.. those went defunct too.
Honestly, the fact that their heirs, despite having untold wealth were unable to keep the business going actually shows that individuals sometimes do have merits on their own, independent of the amount of money they were able to collect.
I wouldn't be surprised if society one day sees uber wealth similar to how we see hereditary monarchies. The idea that the uber wealthy "earned" their position has already begun to wither.
Hell yeah. You accumulate $100m (or whatever the limit is) and we throw a parade for you. You get an award and your name on a plaque. You won capitalism! and you're not allowed to make another cent
Real, per capita economic growth only really started with the Industrial Revolution - when companies started literally making money.
But the mindset of many is still caught up in the uber-conservative (from an economic point of view) mindset dating to the middle ages that wealth is like land: it's just always there, and if you want more, you have to get it from someone else buy buying or seizing.
If you mean the net worth of money, which is zero, yes it is fixed. For one person to have a dollar, another needs to be in debt.
Also, for one person to make profit, they need to spend more than they earn, which inherently means the rest of the economy is in debt. Now you might say the profit will be spent, but then it isn't profit anymore.
Oh and if you want to talk about the real economy, entropy always rises, so no free lunch there either. When the economy grows, all that happens is that the human domain expands and humanity exerts more authority over the processes that occur within its domain. This by definition results in a loss of agency of the non human domain.
The Federal Reserve creates money. This is Econ 101. There is a fixed pie of money it's called the M2. Again, Econ 101.
Perhaps you meant "value"? Be careful though, if you start differentiating between money and value, you arrive at communism. This is literally the first and last chapters of Capital vol 1.
Obviously the monetary policy is important. The innovation part is deflationary and the money creation part is inflationary, if they cancel each other out you end up with more money supply and the same price of goods.
There are usually two reasons people advocate for a cap on earnings. Either they think that every dollar earned makes another person a dollar poorer, therefore a cap limits poverty, or they have some deep seated burning fire of envy. I saw it in university, activists enraged for the sake of being enraged that someone else had done well for themselves.
Bizarre isn't it? If I were to commit one of the seven deadly sins, I'd choose a funner one than envy.
I agree with the premise that "nobody deserves to be a millionaire" (although maybe with inflation we should say deca-millionaire), but a hard cap seems like a crude tool with many potential downsides. A UBI would be a better tool for raising living standards, and a progressive wealth tax would be a better guard against hereditary fortunes, without removing the incentives for high earners to continue working.
You don't need incentives for high earners to continue working.
1) We can afford for them to stop working. Really, it's okay. People can just chill. We're more than efficient enough for it.
2) People don't need monetary incentives to work. Most of us get bored just chilling. We want to feel useful. We need community. We need something to engage our brains. The vast majority of people, left to their own devices, will find some sort of work to do.
Yes. They do now. Not because of boredom but for ideological reasons. The pay and working conditions at the end of the road certainly aren't worth the debt and stress required to get there. Not everyone's a specialist surgeon catering to the elite.
I think most people go for the money. If you were to walk into any undergrad bio 101 class and announce: "sorry guys, but you can only make 80k a year," 95% of the students would leave immediately.
I’m not a doctor, but work with lots. I’m extrapolating what I see and that’s always dangerous, but there isn’t a single colleague whose primary motivation is money. Maybe someone did come in and state an earnings cap, and I’ve been left with the 5%?
It's possible that once people start, they gain satisfaction from the job by helping people. But that doesn't mean that they began that profession because of that. Also consider that many doctors were pushed by their parents into become so. I don't think students spend their childhood chasing "A"s and extra circulars in order to help people.
I don’t think children chase high grades for money.
I’ve been hunting around but can’t find any decent journal article with new students polled on motivations - it would be interesting to see.
The things I’m readying are broadly around a want to help people, often after a health scare of their own or a close family member/friend. I’d prefer something a bit more objective than the puff pieces I’m finding.
What about having a rationally planned democratic society instead of people chasing dollars at the expense of everything? No rich people, just democratic processes accessible to all incl. in production.
I am not in favor of a planned economy, but I do believe our society faces a significant issue with certain individuals hoarding money and resources. If we are to employ a group that uses violence to enforce the will of the majority under the threat of violence, then we should at least utilize this forceful approach to prevent some individuals from becoming entrenched in power and wealth. As they exist now, mechanisms of state violence exist primarily to suppress the uneducated and poor of our society. We should not allow people to hoard wealth. I dont know where that cutoff is or how it should be decided. Maybe increasingly aggressive taxes with no loopholes? It does need to happen
You have provided, perhaps unintentionally, a wonderful concretization on the difference between political power and economic power. In even simpler terms, its the difference between the gun and the dollar.
That is indeed the comparison I was trying to make. The average citizen should (if our democratic system worked correctly) wield just as much political power as the oligarch through his vote and so should be able to wield that power, collectively with the rest of society, to limit the economic power of the oligarch.
Unfortunately as our system works now the oligarch wields both substantially more political power through lobbying and general corruption in the government and courts as well as clearly wielding more economic power. What I am saying is that we as a society should endeavor to reduce the misbalance in economic power between the oligarch and the average citizen.
Yup. Years of propaganda convinced most people that these are exclusive features of Communist dictatorship, when they actually existed in post war capitalist societies as well.
Fun historical fact: the father of the European Union, Jean Monnet, was the head of the “central planning committee” in France in 1950 (and he really wasn't a commie).
Well, the examples you have mind are likely not “democratic societies” (even though they often put a “Democratic“ in their name for good measure).
But then, if you look at the US from the new deal to Reagan or most of Western Europe from WWII to the 80s, you have an idea of what a planned[1] democratic society looks like. And then the scarecrow is less powerful as an argument, isn't it?
Also, Communism hasn't been defeated by the power of the Free Market. It has been defeated by the appeal of democratic societies living under a welfare state system.
When all a democracy has to offer is a free market but no shared well-being, dictatorship is around the corner. (You can already see it with the rise of populists leaders all around the western world).
[1] there used to be so much more planning compared to what goes now that from today's perspective I feel it's fair to call that “planned societies”.
We've seen enough attempts at planned societies that ended badly, so most folk are justifiably wary of further attempts, even putatively democratic ones. Make it easily opt-in, easily opted-out, and successful, and then people will be interested again.
This one is ending badly too. Uncontrolled pandemic with over a million dead, openly supporting a genocide in Palestine, endless war, near zero democratic input from people less rich than wealthy suburbanites, climate crisis, the ending of U.S. hegemony causing a hyperfixation on military control of the world. It goes on and on, and can all be traced back to a fundamentally undemocratic governance structure and economic structure.
It didn't help that prior attempts, while making their own mistakes, were facing an implacable powerful enemy that constantly set out to destroy them. Security threats generate centralization and reduced democracy in all societies.
This general vague concept could be implemented in details in thousands upon thousands of ways, and has not resulted in better or more fair outcomes.
For example, my California city has "democratic" control of how many homes are allowed to be built, and therefore some control over the number of people allowed into the city. The city has decided not to build enough to meet the needs of the general population, but instead pays attention to a tiny minority of city constituents that profit from housing scarcity. They may profit in financial terms from their home valuations, but for some it's not about the money, it's just about keeping people out. It is an intensely unfair system, yet touted as "democratic" control of the means of production of housing.
So color me skeptical that democratic control won't result in even worse outcomes. If we had market control of the amount of housing, at least housing would be cheaper and we wouldn't be kicking people onto the streets continuously due to housing scarcity.
I’m not advocating high rates as good for the poor; I’m championing shaping the yield curve with a market mechanism. It might be too late for that to be anything other than disastrous though, after years of addiction to funny money.