[darawk]

I agree so much with this. I really find the focus on inequality weird and sort of childish. Complaining about inequality strikes me mostly as an attempt to sublimate envy into a politically palatable narrative. What we really ought to focus on is not reducing "inequality", by pulling the ceiling down...but raising the minimum standard of living by pulling the floor up. I think UBI is an excellent way of doing that, but there are many.

[jdavis703]

There’s a huge difference between the “I’m a young single college grad making $50k a year and billionaires are the reason I’m poor” narrative and literally stepping over potentially dead unsheltered people on your way to the office of a multi-billion dollar company. How can we make sure that people don’t have to sleep on the street and suffer from poor healthcare? Because currently income inequality is creating developing country, slum-like conditions in the US.

[BucketSort]

> How can we make sure that people don’t have to sleep on the street and suffer from poor healthcare?

The first step is a cultural change. I believe the ball is in the court of the writers, musicians, philosophers, poets, celebrities ... people involved with shaping culture. To give an example of how how toxic our culture has become, I'll recount something that just happened 30 minutes ago.

There's this nice old lady near my hackerspace who operates a small food cart. Not many people visit her because where she's allowed to be is laughably secluded, so she mainly sits there all day waiting for customers. Another member of the hackerspace said he was going to Wallgreens to get a candy bar and asked if anyone else wanted something.

I said: "Hey, there's the food cart lady who has that stuff and she's just a 1 minute walk away, instead of the Wallgreens which is 10 minutes away."

Upon hearing this, another member grunted with disapproval. I asked what was up.

He said: "She sold me a disgusting sandwich, you shouldn't support a business that is run that poorly."

I replied: "She's an old lady! Did you give her any feedback on the sandwich, maybe she can improve?"

Him: "A business run like that is beyond help."

I'm still shocked how this person couldn't even see past the business into the person. This is a huge problem I see: we forget we are dealing with people because we classify them simply as objects of utility. Our consumerist abstractions are causing us to be quite nasty to others.

[darawk]

> There’s a huge difference between the “I’m a young single college grad making $50k a year and billionaires are the reason I’m poor” narrative and literally stepping over potentially dead unsheltered people on your way to the office of a multi-billion dollar company. How can we make sure that people don’t have to sleep on the street and suffer from poor healthcare? Because currently income inequality is creating developing country, slum-like conditions in the US.

How, exactly is income-inequality creating those conditions? It seems to me like the issue you're describing is one of a floor that is too low. Which is exactly what I said.

[tomohawk]

When people focus on inequality, are they doing so because they love the poor and want to do something for them, or because they hate/envy the rich? Too often, it's the latter.

Instead of UBI, a negative income tax is a much better approach. There's a lot of info out there about it, but here's a nice intro:

https://m.youtube.com/watch?v=xtpgkX588nM

[koolba]

In some ways we already have that with the earned income tax credit: https://en.m.wikipedia.org/wiki/Earned_income_tax_credit

[darawk]

Ya, the EITC is a negative income tax. But it should probably be expanded, it's a great policy.

[dragonwriter]

> Ya, the EITC is a negative income tax

EITC is a hybrid normal and inverse means-tested, and also behavior (by source of income) tested, welfare program managed through the tax system that was loosely inspired by negative income tax, but it is not actually a negative income tax.

[darawk]

Aka a form of negative income tax.

[aaomidi]

Unfortunately the issue with inequality is that it breeds more inequality.

Someone born into the .1% will continue to get richer and richer by literally not doing anything while others on different parts of the spectrum aren't in a position like that and many have negative assets.

If the playing ground was equal at birth and people were differentiated based on their hardwork no one would complain. The issue is the playing ground is not level and every day it gets more and more skewed.

[darawk]

> Someone born into the .1% will continue to get richer and richer by literally not doing anything while others on different parts of the spectrum aren't in a position like that and many have negative assets.

What you're talking about here is wealth mobility. And I think we should definitely be talking about policies to promote that. Especially in the upwards direction.

[aaomidi]

We can't talk about this without talking about the inequality in wealth which is the biggest factor in economy mobility unfortunately.

[darawk]

> We can't talk about this without talking about the inequality in wealth which is the biggest factor in economy mobility unfortunately.

That's an interesting theory. How does that work, exactly, though? How does wealth inequality squash income mobility? And if income mobility is the real goal, why are we talking about inequality, and not directly talking about mobility?

[aaomidi]

Honestly, I'm not an economist. But from what I've gathered from reading various opinions on this matter is that economic inequality is the main source of weak economic mobility in developed countries - especially in countries that don't have safety nets.

The theory essentially is that strong economic mobility requires some "base" value of economic power.

If you're born into a family with negative assets, thousands of dollars in credit card debt, bad neighborhood you're essentially starting your life with negative economic mobility and turning that positive is extremely difficult given the circumstances and in many cases you stay poor. For example, the effects of redlining is still seen to this day after nearly half a century has passed.

On the other end, if you're born into a family with a strong economic background and proper investments. You're already starting your life with positive economic mobility.

The way to think about it is, if you're on the bottom of the graph in terms of assets, you're going to be going further and further down (until where is the question?) and if you're on the top of the graph you're going to keep going up.

College, various inheritance taxes, social safety nets, etc etc try to offset these differences by essentially making the top of the graph a little "weaker" and boosting the bottom of the graph. But is it working?

[darawk]

I agree with all that, but doesn't that mostly argue for shifting the bottom up, rather the pulling the top down? What I see is people using the word "inequality", but then talking about poverty. Poverty is bad. But I don't really understand why the ratio of the top to the bottom is the important number, rather than the absolute value of the bottom.

[threatofrain]

If the playing ground began equal we’d still end up with power begets power. People might just feel better about one inequality over another.

Meritocracy and egalitarianism are in hot tension. Capitalism and democracy are in similar tension.

[pitaj]

The vast majority of wealthy families lose it within three generations.

Growing your wealth requires taking on risk: your investments may not turn out well.

[scandox]

Where does that info come from? I went to school with people whose wealth can be traced back more than 20 generations. They didn't seem to getting poorer.

[robocat]

"The richest families in Florence in 1427 are still the richest families in Florence"

https://qz.com/694340/the-richest-families-in-florence-in-14...

[lprubin]

Here is some data showing 70% by the second generation and 90% by the third:

https://www.google.com/amp/amp.timeinc.net/time/money/392530...

Perhaps you just met some of the exceptions.

[monocasa]

Do you have data that isn't a blatant ad campaign consisting of pithy statements from a wealth management company trying to scare people into letting them manage their money?

[aaomidi]

Exactly this. It's extremely difficult to lose your money at that stage.

[jhayward]

Something like 65% of all land in the UK is owned by the same families that owned it in the Norman conquest. 0.3% of the population today. Since 1066-1100.

The stat you quote may apply to some broader definition of “wealthy”, but for the true 0.1% - 0.01% it is truly eternal, and accelerating.

[groby_b]

You might want to pay closer attention to the complaints about inequality. What that focus is about is the degree of inequality.

Most people talking about it are not actually pursuing a world of absolute equality, but a world with reasonable levels of inequality, and with regulations that make a rapidly increasing spread less likely. I.e. we want floor and ceiling not too far apart, and not rapidly separating. Which means UBI alone, or minimum wage, or any number of floor-focused things are not the answer. Neither is a wealth tax, or any number of ceiling focused things the answer, by themselves.

[darawk]

> You might want to pay closer attention to the complaints about inequality. What that focus is about is the degree of inequality.

I pay quite a bit of attention to it. I'm aware of what it is people are complaining about. Everything I said stands.

> Most people talking about it are not actually pursuing a world of absolute equality, but a world with reasonable levels of inequality, and with regulations that make a rapidly increasing spread less likely. I.e. we want floor and ceiling not too far apart, and not rapidly separating. Which means UBI alone, or minimum wage, or any number of floor-focused things are not the answer. Neither is a wealth tax, or any number of ceiling focused things the answer, by themselves.

Why? What's good about that? What, exactly, is the benefit we get from pursuing a flat wealth distribution? People often promote this idea, making the implicit assumption that reducing inequality is somehow a good in and of itself.

The point of these things should be to improve the material living standards of as many people as possible. If reducing inequality is a necessary side effect of doing that, then fine. But I see no reason to pursue that as an actual ultimate goal.

[jjoonathan]

The notion of "value" pursued and optimized by our economy is proportional to wealth. Feeding a starving poor person has no economic value, but helping a rich person drain middle class retirement accounts has enormous economic value.

To the extent that the wealth distribution is unequal, our economy will ignore real, pressing issues among the poor in order to focus on the increasingly esoteric "needs" of the wealthy.

That's why absurdly lopsided wealth distribution is a problem.

[darawk]

> The notion of "value" pursued and optimized by our economy is proportional to wealth. Feeding a starving poor person has no economic value, but helping a rich person win the game of thrones / bank accounts has enormous economic value.

If you feed a poor person so that they can get a job and contribute to society, that generates quite a lot of economic value. But yes, you're right, giving away food does not increase GDP on its own. But then, neither does zero-sum wealth transfer.

> To the extent that the wealth distribution is unequal, our society will ignore real, pressing issues in order to focus its energy on silly zero-sum pissing contests among the few individuals that matter according to said distribution.

Is that so? That must be why our technology looks the same today as it did 100 years ago. Or 50 years ago. Or 20 years ago. Or 10 years ago. All those zero-sum pissing contests.

[jjoonathan]

> If you feed a poor person so that they can get a job and contribute to society, that generates quite a lot of economic value.

Not for you. Feeding a poor starving person does not make you richer. If they could have afforded to pay, they would not be starving. The economy fails to incentivize the satisfaction of a real need because it does not value the needs of those without money.

That, of course, is an extreme example, but the same principle applies to all the shades of gray.

> Is that so? That must be why our technology looks the same today as it did 100 years ago. Or 50 years ago. Or 20 years ago. Or 10 years ago. All those zero-sum pissing contests.

Any system of power can lay claim to the products of the society it governs, but I have always found those claims wanting, because there are so many other factors involved. Technological progress in particular. Capitalism's advocates are really good

The notion of incentivizing people to do important work is not unique to capitalism. Capitalism is not even particularly good at it, and is getting worse at it, as inequality in the wealth distribution drives capitalism's notion of what is important further and further away from what most people actually find important.

Capitalism on a somewhat level-ish wealth distribution is great: everyone gets a say in what's important. Capitalism on a super skewed wealth distribution is not great: only the lucky few get to say what's important, and everyone else is ignored. The wealth distribution is the problem, and policy to make sure it doesn't run away is going to be the eventual solution.

[darawk]

> Not for you. Feeding a poor starving person does not make you richer. If they could have afforded to pay, they would not be starving. The economy fails to incentivize the satisfaction of a real need because it does not value the needs of those without money.

It does not value the needs of those who have not contributed to its largesse. You are valued in proportion to your contribution, or the contribution of your parents.

> The notion of incentivizing people to do important work is not unique to capitalism. Capitalism is not even particularly good at it, and is getting worse at it,

Capitalism is certainly the best of any system i'm aware of. Is there some other system you're aware of that's done a better job of producing innovation?

> as inequality in the wealth distribution drives capitalism's notion of what is important further and further away from what most people actually find important.

Hm? Away from what most people find important? How do you get people's money if you're not offering them something in exchange that they find important?

[tomp]

Is the degree of inequality really the issue though? Personally, I like that there are people like Jeff Bezos who can personally fund a space company.

The real problems, for me, are the power imbalances (lobbying, corruption, tax evation by rich people), and rent seeking (e.g. owning real estate or entrenched businesses).

[groby_b]

Power imbalance is directly created by the insanely rich. Bezos bought an entire newspaper. Sheldon Adelson buys his politicians more directly, but same difference.

And rent seeking is what enables the imbalance. Without rent-seeking, it'd be much harder for the gap to widen (because rent seeking captures wealth creation for the benefit of the rent seeker)

And of course, the two feed into each other - power imbalance allows for lobbying, creating opportunities to obtain rent. Which, in turn, widens the power imbalance.

Maybe you could theoretically fix those two without addressing inequality. I don't know. I suspect it wouldn't work - if you truly fixed power imbalances and rent seeking, I'd wager you'd address wealth disparity too.

I'd see all of them as tangled in the big hairy cluster that is laissez-faire capitalism.

[Retra]

Wealth inequality is the main cause of power inequality, and is thus a major reason why something like UBI won't happen just because it benefits poor people.

You can't make the world better if you are powerless, and you are powerless so long as you can be overruled by those with more wealth than you.

[darawk]

> Wealth inequality is the main cause of power inequality, and is thus a major reason why something like UBI won't happen just because it benefits poor people.

Poor people seem pretty powerful to me. In a world where rich people are infinitely powerful...what percentage of tax revenue do you think they'd be paying? 0%? 10%? The top 3% if earners paid over 50% of income tax in the US in 2016 [1]. That doesn't seem particularly powerful to me. Or, if it is, that power isn't wielded especially self-interestedly.

> You can't make the world better if you are powerless, and you are powerless so long as you can be overruled by those with more wealth than you.

Your inferences are correct, but your premises are wrong. And if you're worried about money influencing politics, well, i've got news for you: reducing wealth inequality is just going to make the influence of that money even less transparent than it is now.

1. https://www.bloomberg.com/news/articles/2018-10-14/top-3-of-...

[the_gastropod]

> Poor people seem pretty powerful to me. In a world where rich people are infinitely powerful...what percentage of tax revenue do you think they'd be paying? 0%? 10%? The top 3% if earners paid over 50% of income tax in the US in 2016 [1]. That doesn't seem particularly powerful to me. Or, if it is, that power isn't wielded especially self-interestedly.

Oh, give me a break. This is silly statistic often dragged out by right-wing pundits. If the entire US population earned $0 and one guy (pick anyone!) made $1 Trillion per year and paid his ~$400 Billion in taxes each year would you see him as a victim, too?

Another silly example: New York, California, and Florida contribute 25% of the U.S's tax revenues, yet they don't account for 25% of congress. They don't get 25% of the electoral college votes in presidential elections. Poor them, right?

[darawk]

> Oh, give me a break. This is silly statistic often dragged out by right-wing pundits. If the entire US population earned $0 and one guy (pick anyone!) made $1 Trillion per year and paid his ~$400 Billion in taxes each year would you see him as a victim, too?

Did I say anyone was a victim? No. You made a specific point: That the wealthy are disproportionately powerful due to income inequality. My point is: They don't seem to be powerful enough to not pay the overwhelming majority of taxes. I didn't say they were victims, or that they shouldn't be paying more in taxes. It was a counter-example to your point.

> Another silly example: New York, California, and Florida contribute 25% of the U.S's tax revenues, yet they don't account for 25% of congress. They don't get 25% of the electoral college votes in presidential elections. Poor them, right?

Well, actually, I would argue that yes, poor them. California and NY should be better represented in Congress and nationally, through electoral college reforms and other things, but that is pretty far afield from this discussion.

[Retra]

"How much tax you avoid" isn't a reliable measure of political power. Firstly, if paying taxes can work in their benefit, then there's no reason they shouldn't pay them. Secondly, "I pay your wages" is a pretty good way to influence people, and I don't see why it would fundamentally be different in congress. Thirdly, wealthy people do have more ability to avoid paying taxes. Thus the concept of "Tax havens."

[darawk]

> "How much tax you avoid" isn't a reliable measure of political power

Erm, is it not? Do you think rich people enjoy paying taxes? I don't. The fact that the poor manage to force them to pay the overwhelming majority of taxes, in order to subsidize social services that they don't even consume is a tremendous defeat for them.

> Firstly, if paying taxes can work in their benefit, then there's no reason they shouldn't pay them

How do they work in their benefit? And secondly, why is it to their benefit to have a progressive tax system? If I were a rich person that could set the rules by fiat, i'd say "sure we should have income taxes, we should all pay a flat tax of 20%". And in fact, you see many rich people and libertarian organizations advocating for exactly this. They get precisely zero traction, because they don't have the political power to do it.