[zug_zug]

Yeah I'm glad somebody's talking about it. Wealth inequality seems like it will be THE defining issue of our lives (accelerated drastically by AI).

I think there are many practical ways to solve it, and would love to see more proposals out there. Instead I tend to see nihilism or division.

[georgeecollins]

A great practical suggestion comes in the recent book: "The Second Estate" by Ray Madoff. It is an excellent analysis of the changes to tax policy in the US that have gotten us here. (Yes, I know this isn't just a US problem, but the US is the most important part.) One key suggestion is just to make transferring money into any trust (any!) a taxable event so that capital gains must be realized.

It sounds trivial but the effect to various tax evasion strategies is very important. It's also something that really ought to be uncontroversial. Read the book!

[aidenn0]

Using an asset as debt-collateral triggering gains being realized would be good too. As would unifying the income and capital gains tax.

I disagree with TFA's idea that a wealth tax is the best solution. IMO wealth is easier to hide than income, it's just that nobody bothers right now with there being no wealth tax.

[tim333]

The UK went through getting rid of that with the landed gentry at the start of the twentieth century. Mostly tax - income and inheritance. It requires the political will to vote in people who will do it though.

[tardedmeme]

Extreme power inequality seems to be the default state of human society. Power concentrates until it's maximally concentrated, then stays there. Power shakeups seem to usually replace one group of elites with another group of smaller or the same size.

Exceptions to this rule come about for specific reasons. Before the industrial revolution, there just wasn't that much power to go around. Everyone was working their land for sustenance, and the rent-seeking nobility extracted some percent of production because that's what there was to extract. When the industrial revolution came, those who figured out how to exploit it became the new nobility and worked their employees to the bone. It was only after actual, bloody, war between the factory owners and the employees that we got labor rights, which were a truce agreement. And that agreement's been steadily declining since Reagan. It took a while because the beneficiaries of the labor rights era were able to hold onto their wealth and pass it down to their children, but now we're back in the same factory feudalism situation again, but with different technological status.

[harimau777]

That sounds like the same observation that Thomas Jefferson made:

"The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants."

[Obscurity4340]

He always knew just what to say

[bryanrasmussen]

generally the power shakeup that replaces an elite with another elite is one that replaces an old elite with a rising elite better able to take advantage of some economic conditions the old elite is ill-equipped to take advantage of

https://medium.com/luminasticity/the-new-exploiters-9d8a0684...

[6AA4FD]

Great works on this subject, to my mind refuting your nebulous thesis, include Debt by Graeber, Dawn of Everything by Graeber and Wengrow, and Mutual Aid by Kropotkin.

[thrance]

I think you'll find that any specific change in political directions come about from specific reasons (what would even be the alternative?).

[joe_mamba]

>Everyone was working their land for sustenance, and the rent-seeking nobility extracted some percent of production because that's what there was to extract

Until the black death came in the 1300's and killed an estimated 30–60% of Europe's population, and now the nobility had nobody to rent seek or even to work their land.

So then, for the first time ever, the surviving workers gained bargaining power as landowners (lords) competed for labor, leading to high cash wages, better working conditions, and more freedom for peasants, because the feudal lords hadn't yet figured out how to replace the peasants with slaves, H1-Bs and illegals from across the planet.

So according to history, including your post-WW1 example, the only times peasants gained bargaining power was when millions of them died through world wars and global pestilence.

Looking at recent unfolding history, "There's something very familiar about all this" -Biff Tannen

[readthenotes1]

I don't know why you're down voted. Perhaps the observation that inequality is often and the noble savage utopian dream of "all pigs are equal" is not the norm is too a bitter pill to swallow

[goatlover]

We do need to include the vast human pre-history when makings sweeping claims about the natural state of human society. There might be something about civilizations that concentrate power which wasn't seen nearly as much among hunter-gatherer groups. If so, there might be steps that can be taken to counter it (indeed the past several centuries would strongly suggest so).

[red-iron-pine]

as someone else put it, the best loved, most successful hunter-gatherer still wore skins and slept in a cave with the rest of the tribe.

the surpluses of the agrarian farmers meant that the pharaoh lived a life vastly different from anyone in his kingdom.

[verall]

I believe it's because in many cases, the unspoken follow on to "inequality is the norm" is "and so it's useless (or actively harmful) to try to defy that norm."

Not that above commentator is meaning that.

But many "thought leaders" i.e. Jordan Petersen play around with similar motte-and-bailey - "hierarchies are natural" (examples with lobsters, apes, whatever) --> "existing hierarchies should be preserved" (not defended in the argument but implied).

Probably some downvoters are reacting to the structural similarity, although taken in good faith i think above commenter makes a fine point about the historical pattern of periods of equality being short lived and brought about by great intentional effort while sliding back to inequality seems to occur all of the time.

[_ink_]

What are these practical ways to solve it? And who do you think will implement them? Especially when Billionaires control the opinions of a big chunk of the population.

[roxolotl]

You can read about the transition from the Gilded Age to The Progressive Era in US history for potential solutions. Anti-trust and political reform is a bit part. Political opinions were controlled undemocratically during that period as well through political machines. Direct election of senators, direct primaries, women’s suffrage were enacted to help with that.

[pocksuppet]

Any political solution (as in voting, bills, laws) will have to start with getting political power. You can't do politics without political power.

[ethanwillis]

And when these things aren't possible?

[XorNot]

The US despite everything still runs a popular vote driven democracy that is clearly capable of implementing on short notice, sweeping changes to policy.

The problem remains that the US voter consistently demonstrates they don't actually care about these problems though, compared to using the state to intentionally inflict misery on subgroups they don't like.

The most radical thing the current administration proves is how unimportant taxes and cost of living actually were to its voters, given the broad support it retains despite overtly and continuously raising or making both those problems worse (read cares as: "understands" - for a group which wouldn't shut up about it, apparently significant changes aren't crippling enough to get them to change their vote in many cases).

[kasey_junk]

I think this administration truly puts paid to the idea that billionaires control the US. Trump was _broke_ now he’s making billionaires the world over kiss the ring.

This happened because he’s consistently harnessed the power of the popular vote. Just today he flexed that muscle in Indiana.

I’m distraught that my fellow Americans keep falling for his circus barking and he’s made it clear that norms don’t matter and gerrymandering may be the end of the republic. But you can’t deny the power of the regular persons vote after him.

[JuniperMesos]

Trump was never actually broke, but his popularity comes from the fact that he took a bunch of public political stances that his political opponents refused to take because they genuinely thought those stances were immoral; and then won elections based on those stances because a lot of the electorate also liked them.

There isn't actually one monolithic class of billionaires that all share the same interests and want the same things; and even though an individual billionaire can be personally influential, they simply do not have the power to unilaterally determine the political direction of a country. But regardless of what political direction a country does go in, there's probably some billionaire who is more or less aligned with that direction. So anyone who dislikes that political direction can point to the nearest-ideologically-aligned billionaire and blame them for influencing politics in that way, despite the fact that if the tables were turned and their side was winning, someone else would point to whatever billionaire aligned with them as an evil influencer.

[jbxntuehineoh]

> clearly capable of implementing on short notice, sweeping changes to policy

well, as long as the policy changes in question can be implemented by executive order. good luck doing anything that requires actual legislation.

> The problem remains that the US voter consistently demonstrates they don't actually care about these problems though, compared to using the state to intentionally inflict misery on subgroups they don't like.

what does this mean, exactly? it sounds like you're trying to say that things would have been different, if only those pesky voters hadn't voted for Trump. but they _did_ vote for someone other than Trump in 2020, and that did very little to affect the issues mentioned in the article

[pitaj]

My hot take is that wealth inequality is the least bad problem we could have, if it is even a problem at all.

What people are actually experiencing is not wealth inequality, but cost disease. Vital things (housing, healthcare, education) are more expensive - and that's mostly the fault of state action.

[BobbyJo]

Two things:

1) You have to get it out of your head that it is enough when everyone has X standard of living. It isn't. It's enough when less than a critical threshold of the population is dissatisfied, and that dissatisfaction can come no matter what the median/lowest standard of living is. This is just how societies work, uniformly.

2) Money is a ledger supported by a social contract. Spending wealth in ways that erode the social contract is bad. I think we can all agree 500M dollar yachts, empty luxury apartment buildings, and buying up shorelines in populated areas are all bad looks, and therefore, erode the social contract. The wealthy really need to step in and police each other socially here, if they want to continue being wealthy.

[suttontom]

How do you run a society based on who is dissatisfied? It seems reasonable to say that, even though there's a massive wealth gap, if the poorest are healthier, wealthier, and generally better off than they were a generation ago (that might not be true though with this current generation, who it seems may die earlier than their parents did), then changing laws because those people are "dissatisfied" seems kind of arbitrary, because dissatisfaction is kind of the human condition.

[BobbyJo]

> How do you run a society based on who is dissatisfied?

We already do. Most of what governments do is reactionary to dissatisfaction.

> then changing laws because those people are "dissatisfied" seems kind of arbitrary

It's the opposite of arbitrary. Governments generally rule via power invested in them by the populace. Doing things that alleviate dissatisfaction is a survival tactic.

> dissatisfaction is kind of the human condition.

This is why building a rational and cooperative society is important, because they are the cure for misplaced dissatisfaction. That being said, historically, governments aren't stable, and that is, in large part, due to some of your points.

[BobaFloutist]

The problem is that wealth can be used to purchase dissatisfaction, so that becomes yet another lever for the destructive rich.

[gazebo2]

But that state action is the direct result of wealth's influence over the state and how it operates

[inglor_cz]

Two of the three (housing and education) don't seem to be caused by that.

Neither restrictive zoning, nor the administrative bloat in academia that caused tuition to skyrocket, were lobbied into existence by people like Bezos and Musk. They are result of tireless lobbying of relatively unimportant people seeking their own little rent.

[FireBeyond]

> nor the administrative bloat in academia that caused tuition to skyrocket

While, let's be clear, administrative bloat in academia is a very real issue, pointing to that as the true root issue is far more nebulous. Student loans being made non-dischargeable by bankruptcy meant that universities could afford to raise tuitions because lenders would be happy/ier to fund those loans because they will get their pound of flesh, even if it takes decades longer than designed.

[nullocator]

Aren't most of the housing issues in this country NIMBYism and zoning? NIMBYism lead by vocal, wealthy property owners? Zoning controlled by governments lead and captured by wealthy and corporate interests?

[BrenBarn]

Many of the NIMBY property owners are not nearly wealthy enough to be affected by most wealth tax proposals (e.g., the "few tens of millions" suggested in the article).

[JuniperMesos]

Many NIMBYs are basically ordinary middle-class people who are old enough that they were able to buy the house they live in decades ago before the price of properties in their area got bid up; so most of their wealth is locked up in the same house they are currently living in.

Taxing the extremely wealthy basically does nothing to decrease the property values of this class of people en masse, and decreasing their property values en masse is precisely what it would mean to make housing more affordable for more people.

[inglor_cz]

I don't live in the US, but NIMBYism is rampant here as well and all the practical instances I have witnessed were initiated and carried by dyspeptic pensioners with sincere hatred towards any change.

"But CHILDREN will SCREAM here!" shouted one such lady at me when I dared express my opposition against her petition, which demanded a stop to a "megalomaniac" plan to build approximately fifteen apartments half a kilometer away.

"You were a child once, too," I said.

"Sure, but I was A GOOD BEHAVED ONE, NOT LIKE TODAY'S BRATS!" at that time, she was positively screaming as well.

M'kay.

The situation in the US may be different, but the few YIMBY blogs and articles I have read mostly described their efforts as an uphill battle against progressive politicians who were certain that development leads to gentrification and gentrification is bad. Given that the YIMBY movement originated in California, this may just be an aftereffect of Californian politics. But in general, it is blue cities and regions that are known for very restrictive zoning policies.

[goatlover]

Politically wealth inequality is a problem as the wealthy have more means available to them to influence votes, candidates and appointments. So you have a society that's partly democratic but with a lot of unequal influence at the top.

[rconti]

I'm not well-versed in "cost disease", but yes, standards go up. Cars have to have airbags and backup cameras and infernal electronic nannies. So an (alleged) increase in safety has been mandated, and the costs are obligatory. IOW, your risk of dying in a car goes down, but it doesn't come for free.

Medical care is getting better, insurance is required to pay for more and more things, but that drives up insurance costs.

In my county, fire sprinklers are required in all new houses.

Costs go up, but at least, in theory, you're getting something in return.

You're welcome to blame the state. Without those actions, things would be somewhat more affordable. But it seems pretty clear from the data on inequality that inequality is a much bigger factor in bidding up living costs than the fact that I need to install sprinklers in my house, even if sprinklers are a very large cost relative to my income.

[UncleMeat]

More than one million people die of TB annually, a disease that has an inexpensive treatment.

That’s not cost disease. That is wealth inequality killing people.

[lovich]

> if it is even a problem at all.

One of the pillars of capitalism is that the entire economy is more efficient when decision making power is dispersed as close as possible to the people making economic decisions aka what they buy.

When we have ended up in a situation where a handful of people are making all the economic decisions because they have all the money, there is no functional difference between that situation and a command economy.

If you’re a believer in capitalism as a tool to eliminate scarcity you should view the existence of billionaires(adjust for inflation) over the longer term as policy failures that are eroding capitalisms ability to create more and more.

[slibhb]

Inequality isn't a big problem. Those who claim it is seem to think that the existence of really rich people causes the existence of really poor people. That is not the case.

It's natural that things are less equal now that we're not farmers or hunter-gatherers. Economies of scale will massively enrich those who take build them.

Sometimes it is claimed that inequality is a problem because the rich will control politics. But populism is surging and the rich seem to have a harder time controlling politics than ever, largely due to the disintegration of the print/tv media.

[stavros]

I don't think anyone says that really poor people are caused by the existence of really rich people. The argument, as I understand it, is that spreading the wealth of billionaires around would mean fewer really poor people.

[ponector]

If all wealth of top 10 will be distributed equally it will add 5-10k per person. Will it make any difference in amount of pure people?

[piva00]

The distribution will go into services that compound the 5k-10k across society, not to individuals.

Education returns the investment to a nation at around 9%/year. Transportation infrastructure (especially if it's not only for roads in dense urban centres) also has a decent ROI. Investment in science, fundamental research that most private entities don't have the risk appetite for, has a massive ROI for a nation over time.

Providing public services and safety nets for a society also free up humans to take risks such as starting businesses, if you know you will be able to survive with dignity even if it all crashes and burns you are more inclined to try out that business idea instead of being stuck at a bad job. It makes bad jobs also more unattractive, requiring better salaries which reduces the gap between the haves and have-nots, this lowers crime, increases social cohesion, etc.

What exactly is the benefit for society of not taxing wealthy people out of 2% of their wealth? They mostly don't use that wealth to invest in risky ventures, they rely on banks for that.

[stavros]

Yes, 5k will make a difference. How about the top 1000?

[ponector]

Average household debt is 154k. Average household credit card debt is 11k.

How 5k will make a difference?

[stavros]

Because a household typically has more than one person in it, which immediately means no credit card debt.

[suttontom]

How about the top 10,000? How about any wealth you personally have? At what point does it stop being OK for you to take people's wealth? When someone becomes a billionaire?

This reminds me of when Bernie Sanders was asked why it's OK for him to be a millionaire and he said something akin to "If you write a popular book like I did, you can be a millionaire too." Well maybe if you reinvent electric cars and space travel or build a company that ships you almost anything you can think of within 2 days then you can be a billionaire.

[stavros]

We can decide the point collectively. After you have enough to live a comfortable, fulfilling life, you don't need more money.