[HN Gopher] Inheriting is becoming nearly as important as working
___________________________________________________________________
Inheriting is becoming nearly as important as working
Author : pseudolus
Score : 532 points
Date : 2025-02-28 23:20 UTC (23 hours ago)
(HTM) web link (www.economist.com)
(TXT) w3m dump (www.economist.com)
| pseudolus wrote:
| https://archive.ph/kAVoo
| kleton wrote:
| Becoming? This may sound like a trope and a canard, but indeed
| this very publication, The Economist is partially owned and
| controlled by the Rothschild dynasty.
| TZubiri wrote:
| Yeah wealthy families exist.
|
| But also there is a lot of upwards mobility.
|
| And they do not need to be correlated even. What if rich
| families maintain their wealth, and meanwhile other families
| create wealth and become rich. How is this incompatible?
| iamshs wrote:
| So why do rich families need to own all the media? All the
| think firms? Why do they lobby?
|
| Avenues to upward mobility are blocked by these rich people
| through various methods.
| Judgmentality wrote:
| > But also there is a lot of upwards mobility.
|
| There's increasingly less in the USA. In fact, most people
| today will end up worse off than their parents.
|
| https://www.weforum.org/stories/2020/09/social-mobility-
| upwa...
| TZubiri wrote:
| I think this is a statistics and definitions question
|
| There can be a lot of upwards mobility (say 10%), and there
| can be a lot of statics (say 90%)
|
| The datapoint I remembered is that a huge fraction of
| billionaires wer3 first generation billionaires.
|
| But that may not mean much for the greater part of the
| population.
|
| So we may be saying things that sound contradictory, but
| are congruent.
| Judgmentality wrote:
| Your evidence is that there are more billionaires when
| arguing there is upward mobility? We are talking about
| completely different things. Many of those people started
| out as multimillionaires and then became billionaires -
| almost none of them started out poor. And you're focusing
| on a tiny percent of the population and extrapolating
| that to everyone as though it's representative of
| anything meaningful.
| TZubiri wrote:
| https://youtube.com/shorts/MqA-hUeYvb0
|
| Millionaires too.
|
| The last bit is sus though. "Only inherited after making
| a million". Sounds like it would include born rich, high
| education, basic necessities covered, can work on
| startups without worrying about earning a salary, many
| such cases.
| svnt wrote:
| Because as wealthy families produce offspring who do not need
| to work or earn income in order to compete for finite
| resources with those who do, the cost of those resources
| increases, while the burden of labor and stress falls
| increasingly on the employed.
|
| Eventually the man dying while making an income and spending
| no time with his child will grow to resent the one making the
| same income through family wealth who has enough time for
| that and more.
| TZubiri wrote:
| Might you be conflating finite for static? Or more
| charitably, implying and assuming the growth rate is
| smaller or equal to consumption.
|
| I'm not saying it is or isn't, but that would need to be
| the case for your argument.
|
| Also the ratio of wealthy to non wealthy needs to be quite
| high.
|
| Also wealth needs to be transferred and maintained, and not
| spoiled or lost.
|
| I think those are the assumptions.
|
| But yeah, under those conditions, the competition for
| resources would mean in order to move upwards someone needs
| to come down.
|
| But it would need to be a zero sum economy
| svnt wrote:
| Thank you for passive-aggressively outlining the infinite
| growth mindset.
|
| Falsely equating economic growth with cost of living
| metrics, and assuming that with more money everything can
| just continue happily. It's been a very successful
| evolutionary niche for a handful of centuries.
| dingnuts wrote:
| when wealthy people have kids their wealth is diluted.
| Truly, one of the best parts of Elon Musk having so many
| fucking kids is that at least his fortune will be greatly
| divided and spread the second he dies
|
| Generational wealth rarely lasts more than a generation or
| two. Families like the Rothschilds seem to be more the
| exception than the rule.
|
| Though I am not wealthy so perhaps I truly don't know what
| it's like in the big club I'm not in
| TZubiri wrote:
| Also it's not enough in my experience to just give the
| money, also time. And not too much money, gates famously
| gave 10m "only" to each child
| icedchai wrote:
| Sure, each one of his kids will probably only inherit a
| few 10's of billions. What do you think the effective
| difference between 10 billion and 100 billion is? You're
| rich AF either way.
| gruez wrote:
| If you read the second paragraph the authors explain what they
| mean by "becoming".
|
| >People in advanced economies stand to inherit around $6trn
| this year--about 10% of GDP, up from around 5% on average in a
| selection of rich countries during the middle of the 20th
| century. As a share of output, annual inheritance flows have
| doubled in France since the 1960s, and nearly trebled in
| Germany since the 1970s. Whether a young person can afford to
| buy a house and live in relative comfort is determined by
| inherited wealth nearly as much as it is by their own success
| at work. This shift has alarming economic and social
| consequences, because it imperils not just the meritocratic
| ideal, but capitalism itself.
| andy_ppp wrote:
| People really should look at the work of Gary Stevenson here:
| https://youtu.be/TflnQb9E6lw
|
| The truth is economic growth hasn't been occurring in real terms
| for most people for a long time and the rich have been
| transferring money from the poor to themselves at a dramatic
| rate.
|
| I'm starting to think the entire system is corrupt and we are
| headed for a destroyed Europe and a civil war in the US. Maybe
| I'm very pessimistic but this moment in history feels like the
| end of the American empire, what comes after this is extremely
| uncertain but people only seem to demand a fair piece of the
| wealth after a world war.
| mandmandam wrote:
| Dude Gary Stevenson is so good, great to see him shouted out on
| these conversations.
|
| I've long wondered why so many economists get inequality so
| incredibly wrong without any hint of self-awareness whatsoever,
| and the answer (in part 3 of that series) was mind-blowing. So,
| so well put together.
|
| I won't give the spoilers here, but do watch it. It's an
| experience.
| lorenzowood wrote:
| +1 for @garyseconomics
| simonbarker87 wrote:
| Perhaps my friends and I are outliers, none of us inherited any
| wealth or were given trust funds or lump sums when hitting
| adulthood but all of us are better off than our parents at the
| same age and their parents are better off than their parents
| (with one exception).
|
| All either studied hard in school and went on to get a degree
| or left school at 18 and apprenticed in a trade or got specific
| qualifications.
|
| I read so much about declining wealth and how each generation
| is worse off that I have to assume I'm in a lucky bubble
| because it's not the case for me.
|
| None of us are rich but the system appears to be working from a
| sample of say 30 people aged 25 to 45 from different parts and
| backgrounds in the UK.
| jibbit wrote:
| did you buy a house? when?
| simonbarker87 wrote:
| Yes, 2014 with a 95% mortgage
| scarby2 wrote:
| is you're birth year 87?
|
| In which case you were able to save a deposit within 6
| years of graduating? When i was at that stage my
| outgoings (rent, food, council tax, car, insurance) were
| probably 90% of my salary.
| pertymcpert wrote:
| Where are you and how long did it take to save up for a
| downpayment?
| simonbarker87 wrote:
| First house was in the North of England, took 4 years to
| save up enough.
| thereticent wrote:
| Are you in the black as a household overall?
|
| We aren't yet. Our projection is that we will be in 5-7
| years. I'm turning forty soon.
|
| Just to give you an anchor point.
| koolba wrote:
| What does "in the black" mean at a household level? Total
| assets minus loan balances being positive?
| thereticent wrote:
| Sorry, yes. I was thinking net worth > 0.
| simonbarker87 wrote:
| Ah, I was wondering too but my reply button was gone, yes
| I would say we'll be net > 0 around the same time as you
| age wise. If we hadn't had to renovate a 60s property
| we'd possibly be there already but UK housing stock needs
| work sadly.
| scarby2 wrote:
| > None of us are rich but the system appears to be working
| from a sample of say 30 people aged 25 to 45 from different
| parts and backgrounds in the UK.
|
| I have a similar sample, all middle class in their 30's. The
| only ones who have bought houses have been given significant
| assistance from their parents, now none of them are poor by
| any stretch, but few have any significant assets.
| throwaway314155 wrote:
| > Perhaps my friends and I are outliers
|
| That's it, you're outliers.
| brundolf wrote:
| Which fields?
|
| I feel like software has been an outlier here for a decade;
| the only place where traditional economic intuitions still
| apply (semi-smart people can work hard, learn a technical
| skill, find a job in their field, pay off their loans, make
| more than their parents, afford a house, and have a
| comfortable personal life and relatively fulfilling work
| life)
|
| Everything I've heard from the rest of the economy is that
| this model is dead
| simonbarker87 wrote:
| Fair question, it's a mix: IT admin, manufacturing project
| manager, primary school teacher, tree surgeon, mortgage
| advisor, doctor, something in finance, secondary school
| teacher, plumber, software developer, power electronics
| engineer, charity sector project lead
|
| So a real mix
| Aromasin wrote:
| Okay, so a lot of ~PS40k a year salaries (outside of
| medicine and finance) to afford a PS400k house when your
| parents might have had a PS20k salary to afford an PS80k
| house? There's a real disparity when you consider what
| they did too. If your parents are anything like mine,
| they were in the pub 4 days a week, drinking and eating
| with friends. I can managed that just a few times a
| month. Wealth compared to income from my experience is
| significantly lower by .lost metrics.
| directevolve wrote:
| This paper has an excellent, readable breakdown of how
| compensation and productivity has changed since the
| 1970s.
| the_real_cher wrote:
| Maybe you have an exceptional friend group because ..
| outside of your anecdata .. the statistically average
| salaries for many of those professions over large sample
| sets is below the median in the us and they are
| definitely not seeing their purchasing power increasing
| yearly
| derektank wrote:
| >they are definitely not seeing their purchasing power
| increasing yearly
|
| In the US? Real Disposable Personal Income has been
| growing very consistently over time [1]. The rate of
| growth did stagnate between 2000 and 2013 but the trend
| has been remarkably consistent.
|
| [1] https://fred.stlouisfed.org/series/DSPIC96
| raziel2p wrote:
| the per capita version of your graph:
| https://fred.stlouisfed.org/series/A229RX0
|
| it claims that the average person has 50k usd in
| disposable yearly income - there's no way that's after
| housing and other non optional expenses have been
| accounted for.
|
| using this measurement, if wages go up 5% but rent goes
| up 50%, it would still look as if people have more money
| to spend than before.
| the_real_cher wrote:
| very minimally and not in proportion to their output.
|
| the rich are taking The Lion's share of productivity
| growth
|
| https://www.epi.org/publication/charting-wage-
| stagnation/#:~...
| giantg2 wrote:
| "the only place where traditional economic intuitions still
| apply"
|
| Which economy? In the US, healthcare, public schools in
| some states, and B2B sales come to mind as decent jobs. But
| I agree with the general sentiment - there do not seem to
| be great choices that support a nice life. Quite a few of
| my friend have to work multiple jobs or double shifts to
| make it work.
| Retric wrote:
| Most healthcare jobs don't pay particularly well. The
| inefficiency is going to pay the salaries of medical
| transcriptionists, people handling billing inside
| insurance and in healthcare facilities etc. Things that
| aren't improving outcomes are ultimately why healthcare
| is expensive in the US.
|
| Just for comparison the minimum wage nationwide in Feb 1,
| 1968 was 1.60$/hour that's ~14.61$/hour when adjusted for
| inflation. Median household income in 1968 was 8,600$ or
| ~$78,504.90 inflation adjusted and that was mostly single
| income.
|
| https://www.census.gov/library/publications/1969/demo/p60
| -66...
|
| https://www.usinflationcalculator.com/
| giantg2 wrote:
| I wasn't really talking about the billing, but more about
| doctors, nurses, medical manufacturing, etc.
| Retric wrote:
| That's the higher end of medicine, orderlies are making
| 16$/h. People on ambulances are often making 17$/h. Some
| nurses make ok money, but starting salary for a school
| nurse is 20$/h and median school nurse is making 30$/h...
|
| Granted I understand what you mean, but it's kind of like
| saying managers make good money while ignoring all the
| shift managers at fast food joints.
| numba888 wrote:
| Can we summarize it that 'easy' or 'low skilled' jobs
| aren't payed better today comparing with the past? Not
| surprising taking into account demand and population.
| More worrying is that high-skilled jobs aren't rewording.
| As for equality.. welcome to USSR, you see how it ended.
| Now only a few Arabs states have greater inequality.
| Retric wrote:
| I wouldn't call working an ambulance as easy by any
| metric.
|
| As to inequality, we've made this much worse
| intentionally via things like a tax code that massively
| favors high income earners. It's not even that this
| tradeoff has increased GDP growth or anything the country
| was growing faster with higher tax rates on corporations
| and dividends.
|
| Even just theoretically it's suboptimal because jobs
| catering to or trying to extract money from high income
| people don't lend themselves to automation. Long term
| everyone rich or poor has been worse off.
| vasco wrote:
| Why wouldn't the required skill level increase though? I
| think it's expected that as a society specializes it
| becomes more and more difficult to get ahead if you're
| producing goods or services at the lowest level of
| specialization. With education getting better and
| technology improving, it's impossible to make rote jobs
| be economically feasible for anything other than robots.
| loglog wrote:
| You have no clue about the collapse of the USSR. Its
| economy was crippled by monopolies and absurd subsidies,
| not by equality.
| kenjackson wrote:
| It also depends on who your parents are. My parents at my
| age were poor working class. We had a much smaller house
| (800 sq ft), used cheap cars, cheaper clothing, etc... My
| dad spent a lot of time fixing our cars (I don't even try),
| fixing plumbing issues, and we rarely ate out (and never
| DoorDash'ed!). I was lucky to get some quarters to go to
| the local arcade to play Pac Man.
|
| My point -- even being slightly lower middle class now
| would feel like a good jump over my parents. That's just
| pointing out that comparisons to parental income is very
| relative.
| alternatex wrote:
| 800 sq ft is a small house in some part of the world?
| porridgeraisin wrote:
| Depends on the occupancy. For a 2BHK I would say 800 is
| small. For a 1BHK, it is good.
| kjkjadksj wrote:
| Certain industries now are at a point where they are paid a
| ton. Jobs like the trades, piloting boats or planes, that
| sort of thing. Your schedule might look a bit irregular,
| but the path to say a quarter a million a year is far more
| realistic today for someone who is a pilot vs someone who
| takes a white collar job.
|
| That phenomenon was not always apparent. Growing up, I was
| told specifically to avoid those sorts of jobs and go for
| white collar, informed by a generation where those sorts of
| jobs were a lot more dangerous and less compensated. In
| some companies over the last century we went from say
| building floors of modestly paid draftsmen and a few highly
| paid white collar classes managing them to floors of
| modestly paid white collar people fiddling with excel and a
| few highly paid certified engineers doing the actual
| technical work. The dynamic has changed.
| tekla wrote:
| Yep. A good friend of mine grew up to a very poor immigrant
| family, both him and his sister got full rides to good
| schools because of grades, and at age 30 bought a house in NJ
| with a very good school with 4 kids after saving non stop and
| living with his parents and taking care of them.
|
| The system works fine if you don't need nonstop luxuries
| tmn wrote:
| It's really incredible how much people feel entitled to in
| the us. And by entitled, I mean they spend money on these
| things because it's beneath them to think they shouldn't
| have said experience or thing.
| ericjmorey wrote:
| Prior generation was buying houses at 20 with less skill.
|
| I'm happy to see that your friend made it work for himself,
| but his was a much harder path than most people saw in
| prior generations.
| fumar wrote:
| How can you compare these experiences to a greater upward
| mobility which does not exist? You don't have a baseline for
| comparison. What if you had 2x more leisure time with the
| same fiscal wealth? What if you had easier access to
| healthcare?
| dingnuts wrote:
| what if we lived forever and money grew on trees
| ericjmorey wrote:
| You didn't even try to understand what you scoffed at. Do
| better.
| thereticent wrote:
| Same here, but we are in a very similar boat in our voyage
| through socioeconomic statuses (though I'm in Ohio River
| Valley US). I may be fooled by the discourse that
| [Xennials/Oregon Trail gen/Gen Y/Elder Millennials], but we
| supposedly saved more, delayed gratification, planned more,
| and worked more than even Gen Z (who, don't get me wrong,
| have it worse because of undercompensation vs purchasing
| power and sheer hopelessness).
|
| I doubt we're typical, is my point.
| giantg2 wrote:
| "in the UK"
|
| In the US, my anecdotes seem to show that things have stayed
| neutral or declined slightly. It seems harder to get a decent
| job than our parents. It seems that fewer of us have bought
| homes, or delayed buying due to financial reasons. Seems like
| more of us are working multiple jobs too. I think the
| aggregate measures showed real income only trending up
| slightly over the past couple generations.
| swatcoder wrote:
| Yes, you and I are outliers and so are many people here.
|
| Those of us who work in tech, and many of the people we find
| ourselves bonding with and staying close to in our adulthood,
| are lucky to have taken up in a sector that happened to see
| disproportionate growth during our careers and admitted many
| people from modest backgrounds.
|
| But people who didn't stumble onto that path, or perhaps
| hoped to follow their parents into professions that were more
| flat or failing (medicine, education, academia, farming,
| manufacturing, "the trades"). In aggregate, some of those
| people are still doing okay, some are doing well, and some
| are flailing in desperation for having made the wrong bet.
|
| Of the people I grew up with in a modest blue collar
| community, I don't know anyone besides the few most ambitious
| and capable that were able to find the security that their
| parents had. And as one of those more ambitious and capable
| people who later circled with people of fancier backgrounds,
| I similarly don't know anyone who pursued things like
| academia or medicine and found what they expected there
| either.
|
| Appreciate what you have! Many don't share it.
| chefandy wrote:
| As someone in the US that's bounced in and out of tech,
| including some longish stints in blue collar jobs, it
| honestly blows my mind that the tech scene is so all-
| encompassing that many in it feel like it is representative
| of... anything else. I'm not talking about the tech
| libertarian types that think any impediment to the ultra
| rich vacuuming up everyone else's wealth is tantamount to
| dictatorship. I'm talking about the typical happy path
| developer (I shy away from saying _average_ because _all_
| us developers are _above-average_ developers) that went to
| college for comp sci right after high school pretty quickly
| secured a junior role for maybe 6x-9x the (ridiculous)
| Federal Poverty Level.
|
| To be clear: I'm not saying they're bad people or
| anything-- most people think their experiences are more
| representative than they are. But, from outside, some of
| the assumptions software folks make about the world just
| seem utterly ridiculous. Consider that on average, junior
| developers make more money than a first year medical
| resident that has a PhD in perhaps the highest demand field
| in the US and works shifts of 16-30 hours with many
| consistently logging 80 hours per week, and occasionally
| end up working much more. Ask that medical resident what a
| really bad day, and a really bad week at work looks like
| for them and ask a developer with the same amount of post-
| school experience the same question, and then consider how
| much more school it took... and then ask that same question
| to an aircraft mechanic, a chef with a culinary degree, a
| construction worker, a public defender, a commercial
| fisherman, a firefighter, a nurse... the software industry
| is more than an aberration -- it's a different planet. The
| kind of shit I've seen developers say they're going to
| "pivot to" if the software industry falls apart is,
| frankly, flabbergasting. If we see the sort of sustained
| job losses some fear in software, there are going to be a
| whole lot of people learning some extremely bitter,
| difficult truths about the world outside.
|
| I'm not saying we all didn't and don't work hard to get
| where we are -- it's just that what developers get vs
| what's expected of us and what we had to do to get there is
| very different than what it is for almost the entire rest
| of the working world. It's easy to see your own
| contributions to your success and miss the industry and
| market scaffolding you could stand on to get what you did.
| alephnerd wrote:
| > it's just that what developers get vs what's expected
| of us and what we had to do to get there is very
| different than what it is for almost the entire rest of
| the working world
|
| It's about margins. Software has the 2nd highest margins
| of any sector (highest is High Finance), so it's easy to
| pay competitively in software compared to other fields.
| chefandy wrote:
| Right. There's obviously a totally valid market-based
| reason for it, and I am absolutely not implying that
| developers should receive less of that than they do.
| However, its an external factor which gives many
| developers a very skewed understanding of how much work
| most people expend for the amount of money they receive
| and agency they get at work, and how much they're worth
| as workers outside of the software world with roughly the
| same amount of ambition and effort. Compared to most
| industries, software companies coddled developers and
| really tried to trump up the mystique of the great hacker
| genius. While particularly apparent in the restaurant
| industry, developers thinking they've 'solved' an
| unrelated business they've got no experience in using
| their genius software brain or assume they can simply
| transfer their existing skills to a new field is pretty
| common. I encountered one developer who thought they'd
| simply pivot to crime to keep their family comfortable,
| which is hilarious. The beginning of a career in crime is
| long and full of petty bullshit crimes that pay very
| little because you don't have the wisdom to not get
| caught doing more serious crimes, and you don't have the
| network to support you doing things like getting
| unregistered guns, fencing, etc. What I wouldn't pay to
| see that guy walk into a bar in a rough part of town,
| order a craft beer, and try to debate the sketchiest
| people he saw about why he'd make a trustworthy partner
| in crime.
| alephnerd wrote:
| I'm in agreement with you!
|
| I'm just saying the only reason SWEs (and IBs) get paid
| the big bucks is primarily because of market economics,
| even if plenty of other high stress roles (eg. Nursing,
| EMT, Teaching) get paid a relative pittance.
|
| I think a lot of us members of the tech industry need to
| cut down on our hubris and respect other industries and
| jobs, and understand that we are cogs inasmuch as anyone
| else.
| chefandy wrote:
| Right right. I imagine it was much the same for
| mechanical engineers during the Industrial Revolution.
| alephnerd wrote:
| Much more recently to be honest. The bottom only fell in
| MechE fields (Automotive, Aerospace, Defense) in the
| 1990s, but if global tensions continue, it might be a
| good time to be a MechE.
| hello_moto wrote:
| Plenty Tech CEOs are humbling tech workers lately by
| performing a ritual known as mass Layoffs.
| alephnerd wrote:
| I still see plenty of first person syndrome on HN crying
| about RTO or multi-month severances.
|
| I get it, because it sucks, but it's still tone deaf for
| people in the top income brackets, 401Ks, and plenty of
| disposable income.
|
| Most Americans (employed or unemployed) don't get any of
| those kinds of benefits.
| dclowd9901 wrote:
| I'm in the same position as you, but I see myself as rather
| lucky. I worked very hard but I also was taught hard work
| translates into success, many people don't see that
| relationship. And I happened to be interested in a lucrative
| career path.
| palata wrote:
| > I also was taught hard work translates into success, many
| people don't see that relationship.
|
| That's a typical confirmation bias: you worked hard and got
| successful, so you're tempted to think that it's because
| you worked hard. Some don't work hard and get successful,
| many work hard and don't get successful.
|
| The one thing that you clearly can't rule out is luck. Tell
| people in Gaza that if they work hard they will end up in a
| situation similar as yours...
| dingnuts wrote:
| some work hard and get successful; some work hard and
| fail
|
| all who don't try fail
| palata wrote:
| I fail to see how this is related to what I said.
| dasil003 wrote:
| It's related because you said "you can't rule out luck"
| which is basically casting doubt on the whole idea of
| hard work having an impact on success. Well, no
| reasonable person would say hard work guarantees success,
| or that all success is luck. The truth is luck and
| serendipity affect all outcomes, but to use that to
| question the impact of a human's agency on their own life
| outcomes is an insidiously disempowering perspective.
| palata wrote:
| Sorry, to me it looks like a lot of words that say
| nothing.
|
| _Obviously_ , if you don't do, you don't do.
|
| > to use that to question the impact of a human's agency
| on their own life outcomes
|
| I'm not doing that at all. I am not saying that the
| effort put into achieving something is worth nothing.
| What I am saying is that whenever someone is successful,
| it means that they have been incredibly lucky (and on top
| of that they worked a lot, maybe). Whenever they compare
| themselves to someone else who also worked hard but was
| not successful, the first conclusion to make is that this
| someone else was not as lucky.
|
| But the first thing that happens when someone gets
| successful is that they forget how lucky they are, and
| just start talking about merit. My point is just that
| whenever you talk about merit, just remember that you
| were not born in a poor family in a war zone, and that
| does not make you more deserving.
| Drew_ wrote:
| > Perhaps my friends and I are outliers, none of us inherited
| any wealth or were given trust funds or lump sums when
| hitting adulthood
|
| > all of us are better off than our parents at the same age
| and their parents are better off than their parents
|
| These are conflicting statements. Your group are all
| beneficiaries of generational wealth by this description.
| Maybe it isn't as overt as a trust fund, but you definitely
| inherited wealth and opportunity from your parents.
| flappyeagle wrote:
| Oh get off your high horse.
| Drew_ wrote:
| I'm not on a high horse.
| monktastic1 wrote:
| It's hard to understand what you're saying here. Being
| better off than your parents implies that you are a
| beneficiary of generational wealth? Connect the dots for
| us.
| Drew_ wrote:
| OP described a group of families that accrued wealth over
| 3 generations "without inheriting any wealth". Assuming
| they weren't orphaned at birth, each generation
| definitely benefited from the fruits of the previous
| generation. Even without an overt handout like a trust
| fund, we still inherit wealth from our ancestors (eg:
| housing, health care, education, credit, social networks,
| etc). In this case, the "handout" would have been their
| upbringing. They feel "the system is working" because of
| this, but not everyone in the system has an ancestry like
| this.
| monktastic1 wrote:
| So by your definition, anyone who isn't an orphan is a
| beneficiary of generational wealth? In fact, even orphans
| are, because they inherited genes, weren't left to die,
| etc.? I suppose that is a definition, but it doesn't seem
| like a useful one, especially in the context of this
| conversation. Or maybe I've just misunderstood you?
| laurencerowe wrote:
| I'm a little surprised by this. While I'm better off than my
| parents I went into a much more highly paying field (software
| engineer vs teacher/social worker.) If I did a similar job to
| them I would have no hope of ever affording a similar house
| to them.
|
| They were part of a generation that benefited from enormous
| house price appreciation due to a combination of falling
| interest rates went from almost 15% down to under 5% (this is
| about 3x on its own) and the fall in house building which
| drove up prices and rents generally.
|
| This effect is somewhat less pronounced outside of southern
| England.
| simonbarker87 wrote:
| You make a good point about higher paying fields in the
| younger generations. While there is a spread of occupations
| that I replied to another commenter with you may have hit
| on something. Nearly everyone has an occupation in a higher
| paying field than their parents/grandparents and everyone
| is dual income whereas, I assume, this was less so in the
| previous generations.
|
| Thinking of one (not me) it's delivery driver -> enlisted
| service -> mid level finance (not London)
|
| Hmmm, food for thought, thank you
| laurencerowe wrote:
| > Nearly everyone has an occupation in a higher paying
| field than their parents/grandparents and everyone is
| dual income whereas, I assume, this was less so in the
| previous generations.
|
| That is unarguably true of our parents' and grandparents'
| generations, but I don't think it is as true of people of
| my age or younger (born in early 1980s.)
|
| There was a huge expansion of higher skilled jobs after
| the war with large numbers of people moving into the
| middle classes. For me and everyone I know our mothers
| (born 1950s) worked. We all grew up in dual income
| families.
|
| My great-grandfather was a miner. His son, my grandfather
| enlisted in the forces during the war, seems to have been
| recognised as being technically apt and worked with
| radar, became an officer and in the early 1960s left to
| be a manager at an engineering company.
|
| His daughter, my mum, became a teacher (first in family
| to go to college) and his son did not go to college but
| became an IT manager (married a teacher). All of us
| grandchildren went to university but basically have
| similar jobs to our parents' generation.
|
| Several of my siblings and cousins own houses but they
| got help from parents or partners' parents and mostly
| bought outside the south east. Renting a flat in London
| as a fairly highly paid IT contractor I had to pay six
| months up front because my parents didn't earn enough to
| be guarantors.
| whamlastxmas wrote:
| Boomers benefited from a ton. Significantly cheaper
| housing, education, healthcare, childcare, groceries, cars,
| gas. Even when adjusted for inflation. Employment was
| significantly easier to get, especially without degrees,
| and those easier to get jobs paid relatively much more in
| terms of the ratio of income to cost of living.
| ericjmorey wrote:
| There was a lot of discrimination that benefited those
| not being discriminated against too
| hello_moto wrote:
| Falling interest rate also benefits the rich that can hoard
| assets, especially with higher leverage because they know
| how to game the systems.
| jauntywundrkind wrote:
| Sure maybe there was some inertia from the benevolent
| bettering institutions of the New Deal that have given a
| chance to Americans.
|
| I just think you'd have to be so willfully in denial as to
| miss the darkness we are descending into. To miss how
| bitterly the GOP and the wealthy are building empires of lies
| and bespoke manufactured realities to make up down and left
| right, to cover for horrible treacherous actions against the
| possibility of the individual, stacking the deck for empire
| and inherited wealth. (And Dems are frequently unwilling to
| bite the donor class that makes winning elections possible,
| after the courts have obstructed democratic funding reforms.)
| Are actively opposing the possibility of people doing good
| for themselves & the world.
|
| I strongly recommend folks go read one of the darkest periods
| of America, before enough was enough Adam Hochschild's
| _American Midnight_ (2022) tells an amazing story of a circa-
| WW1 state that had radicalized against people, that had been
| totally overrun by well monied powers. Of Hoover using the
| full power of the police state to surveil as Ralph Van Demand
| had done during the Philippines civil war, of of the postal
| service run by someone using it for information control, of
| American Defense vigilanism.
|
| Its not a tale of what happened next, how that broke, just a
| long amazing story of how dark America got, how badly the
| state was an extension of capital and power, and how deeply
| it subverted the individual, the union, any attempt for
| everyday humans to make any claim to life liberty, or pursuit
| of happiness.
|
| We face today not quite such amassed power, but a completely
| warped infosphere where these bespoke realities create
| lifestyle beliefs where people are on board with incredible
| trains of lies crafting false enemies, supporting the
| opposite of the signalling they claim. Its different than
| dark; the world today is overloaded by hell's din, by
| monsters of abuse, doing their worst to harm us for greed and
| for the possibility of undoing the good of the world.
| geodel wrote:
| Well things worked out for you and they have worked out for
| me as well. For a long time I have this arrogance expressed
| privately usually to myself or very close people that it is
| all due to hard work, diligence, thrift that I reached where
| I am today.
|
| But lately after reading and observing around quite a bit I
| come to realize due to being ended up in a fast growing
| sector at least a minimum level of success was guaranteed. I
| see same thing at my company where a lot of VPs, Sr VPs and
| above reached to that level primarily they started a decade
| or two earlier than me and growth was much faster than
| compare to when I joined in mid 2000s.
|
| They can talk down to me just like I can talk down to more
| juniors about value of hard work, drive and so on. However,
| joining a growing sector early was best thing career wise. No
| amount of hard work will help if one is starting at a
| middling IT job in middling company in 2025 like I did in
| 2005.
| ghaff wrote:
| Well, and even the company matters. I was in IT since post-
| grad school (with a bit of engineering earlier). But with
| dot-bomb, a company that struggled through and then 2008, I
| was only in an "OK" position. It was really the period post
| 2010 that set things up a lot better.
| geodel wrote:
| Indeed. For me 2010-11 was when I got a full-time job as
| compared to contracting (small time) which was big jump
| for me in terms of job quality and money. Interesting
| enough I met many people who joined Amazon in same time
| frame and earning about 50% more than me in straight
| first job that I earned after with 8-10 years of
| experience. So yeah company part is important.
| ghaff wrote:
| I wouldn't even say it was work quality; the job I had
| for a good period really set me up for my ultimate full-
| time job and I mostly liked it. But that ultimate job was
| a public company and even if not FAANG level comp, set me
| up pretty well and provided the leverage to make
| investments that were pretty solid during that very good
| period.
| listenallyall wrote:
| > a lot of VPs, Sr VPs and above reached to that level
| primarily they started a decade or two earlier than me
|
| Not refuting your point but there is a selection bias here.
| You are in contact with people who did in fact achieve VP
| or higher levels. Lots more also joined the industry 10 or
| 20 years before you and burned out, failed, hated it, got
| fired, whatever. The people who succeeded may not be
| particularly exceptional in terms of talent, brainpower,
| innovative thinking, etc, (lots was luck, or being in the
| right place at the right time, surely) but it's also not
| true that everyone they worked with back then became a big
| success.
| drmath wrote:
| Whether or not you're really _outliers_ , it would be very
| surprising if "my friends and I" were representative of the
| general population.
| frontfor wrote:
| While I don't doubt things have worked out well for you, how
| many of you are able to afford owning real estate?
| bjourne wrote:
| You all studied so hard but never heard about
| https://en.wikipedia.org/wiki/Sampling_bias?
| cool_dude85 wrote:
| I have a very different experience. I did all the right
| things, more or less, got into a good field with a secure job
| in the broader tech industry, and indeed I make very good
| money.
|
| Despite this, I can not afford to buy the house I grew up in;
| a 3 bedroom SFH with a decent sized yard and a pool, around
| 1400 square feet, 45 minutes away from downtown without
| traffic in a hot real estate market. My father was able to
| purchase this home as a tradesman with 4 kids, being the only
| parent who worked outside the home.
| abustamam wrote:
| Same. Though my dad was also a software engineer, but he
| was just never good at negotiating raises. My wife and I
| both work and we could maybe swing the price of the house I
| grew up in, but the mortgage would be roughly the same as
| our rent now currently.
|
| Similar case for my wife. Her parents bought in 2000 with a
| combined household salary of less than mine alone. The
| mortgage would be twice our monthly rent. Fortunately we
| stand to inherit that house, which sort of proves the
| article's point.
| csomar wrote:
| Very anecdotal. You can't just look at yourself and your
| circle (which is similar to yourself) and extrapolate to the
| general population. Also most people in HN are in Tech which
| did well in the last 15-20 years comparing to other fields.
| djtango wrote:
| My dad migrated to London in the 70s and bought his first
| property in London around age 26. He didn't have a degree but
| did get a professional qualification.
|
| I ended up getting a good degree at a top uni and started my
| career at Amazon but definitely couldn't have amassed the
| necessary amount for a down payment for a place in London by
| the time I was 26.
|
| By the time my dad was 35 he had two kids and my mum was a
| full time mum.
|
| This doesn't sound remotely close to the reality of my
| numerous banking, lawyer, accountant, engineering and doctor
| friends.
|
| The only people I know who are remotely close to being able
| to own a property in London and have only one breadwinner
| work in hedge funds.
| simonbarker87 wrote:
| Of my friends only one set lives in London and I have no
| idea how they afford it, one or both of them must be on
| silly money and it's pretty clear most of the money must go
| into the mortgage. I started my career is a very cheap part
| of the UK so I sort of have to carve London out of any
| generalisations I make.
| svara wrote:
| You can't compare London from back then to London today
| though. In terms of its place among cities around the
| world, it's a different place now.
|
| There certainly would have been locations where your dad
| would not have been able to afford property, and conversely
| there certainly are places where you can afford property.
|
| Point being, things change, but this anecdote doesn't
| illustrate that you're worse off than a previous
| generation.
| scotty79 wrote:
| Some of it might be declining costs of everything apart form
| limited resources (like housing).
|
| Perhaps you generation is better off than their parents were
| in terms of everything except real estate. But their parents
| are also better off now than they used to be when they were
| their age, because everything (except housing) is much
| cheaper (relatively) than it used to be thanks to
| optimizations in production and economies of scale of last 5
| decades.
| insane_dreamer wrote:
| You're outliers. Boomers hold the bulk of the wealth in the
| US.
| NoLinkToMe wrote:
| You're not an outlier. If you look at US GDP per capita,
| adjusted for inflation, it's higher than ever. If you then
| look at the median personal income, also adjusted for
| inflation (i.e. the middle class), you see the same trend.
|
| There's a lot of doom and gloom but it doesn't seem
| consistent with the data.
|
| There's a weird tendency to zoom in on particular data points
| that paint a particularly negative story and leave out the
| rest. For example, we look at housing and will say that its
| prices outpaced inflation. And that's true, sort of. But it's
| also completely untrue. For example, if I look at my own
| situation compared to my parents: I have a 1.5% interest rate
| on my mortgage, my parents paid 15%. Homes are now about
| 50-75% bigger than my parents' generation, on average. And
| the average home is shared by 33% fewer people than my
| parents' generation. So the cost to rent the money to buy a
| certain area of home for 1 person, i.e. housing costs, has
| actually gone down, despite the average price of a house
| having gone up.
|
| In all fairness I wouldn't want to trade with the average
| person in past generations.
| hello_moto wrote:
| GDP (per capita or not) cannot show wealth inequality.
|
| Personal income does not include capital gain.
|
| Wealth grow is not included in either of these dataset.
|
| CEO unrealized gain is huge and represents a huge chunk of
| his/her eventual hidden income that becomes wealth.
| eli_gottlieb wrote:
| So you're saying that on average if you can afford to buy a
| house, it's bigger and better than it used to be, but also
| that the fraction of people who can afford to do that is
| stagnating or declining.
| borgdefenser wrote:
| Romanticizing the past while at the same time having an
| apocalyptic view of the future, while I don't know if it is
| a human thing to do, it is certainly a western thing to do.
|
| I think about how much is it worth for me to work remote vs
| working at the same factory for 40 years like my father.
| Some people pretend like this is just a given in the modern
| world and basically worthless. In reality, it is hard to
| put a price tag on because the difference is so valuable to
| me. I actually could have been the 4th generation working
| at a flour mill if I had wanted. Even if the flour mill
| paid double what it does, my life is so much more grand
| than what that would have been, it isn't even close.
| clumsysmurf wrote:
| It's like AOC'c comments to NPR the other day
|
| "Everything feels increasingly like a scam," she said. "Not
| only are grocery prices going up, but it's like everything has
| a fee and a surcharge. And I think that anger is put out at
| government."
| rufus_foreman wrote:
| AOC needs to read "The Jungle" by Upton Sinclair. There is
| nothing new under the sun.
| georgemcbay wrote:
| Is your argument really that because things were really bad
| in 1905 we shouldn't complain that after many decades of
| progress* that we are now rapidly sliding back to things
| being extremely shitty again?
|
| Because that's a really strange way to look at it.
|
| (* driven largely by increased regulation, unionization,
| etc... all the dirty words for modern conservatives)
| rufus_foreman wrote:
| >> Is your argument really that because things were
| really bad in 1905 we shouldn't complain...
|
| No that is not my argument really.
| kubb wrote:
| You're not really making an argument.
| rufus_foreman wrote:
| OK. If I'm not making an argument then we both agree that
| my argument is not that because things were really bad in
| 1905 we shouldn't complain that after many decades of
| progress.
|
| Thanks for agreeing with me, kubb.
| kubb wrote:
| No objections from me, but also no need to thank me. I
| just stated the obvious.
| cscurmudgeon wrote:
| AOC is against taxes and other countries paying their fair
| share?
|
| She realized prices are going up just now?
| toolz wrote:
| people don't demand wealth equality after a war, they just
| create massive inflation during the war and solve it by taking
| everyone's savings after the war...half the countries in europe
| post ww2 did something akin to replacing the national currency
| at exchanges rates of like 10:1 in some cases like
| germany...and germanys post-war inflation solution is hailed as
| an 'economic miracle' by many history books. Somethings tells
| me I wouldn't feel too jazzed about taking 90% of my savings,
| but I would also be resigned to do whatever because war is
| worse.
|
| I get really worried when I see people glamorize equality post-
| war...post-war times are not good times for the middle class.
| The most equal wealth humanity has ever had is during caveman
| times, but that is not the goal.
|
| war does not make things better folks, I hope that's not what
| OP was trying to say, but just in case let's be very very clear
| about how awful war is for progress and humanity.
| scarby2 wrote:
| post-war reconstruction fervor can inspire wealth creation.
| This is largely because there are no NIMBYs and eco-warriros
| sat around saying that the returning troops cant have a place
| to live and we cant have new infrastructure. If we can get
| that reconstruction fervor without a war it would solve a lot
| of our problems.
| toolz wrote:
| I just don't believe this, not because I have hard data,
| but it just doesn't make any sense. Sure, the central banks
| will do everything they can to ignite the economy and
| everyone will be generally working their hardest to recover
| from hard times, but how can an economy that gets
| completely halted to go full bore in war efforts ever hope
| to generate the wealth of an economy that isn't halted and
| has been making incremental improvements, uninterrupted?
| imtringued wrote:
| There are two reasons.
|
| War destroys existing structures and gives them a chance
| to evolve again.
|
| The economy is growth dependent and can only perform its
| basic functions under growth, even if that growth is
| fake. By basic functions I also include all functions
| that do not depend on growth.
| toolz wrote:
| > War destroys existing structures and gives them a
| chance to evolve again.
|
| are you suggesting that destroying things, results in
| improvement in the long run? I don't know that I could be
| farther from agreeing with that. If starting from scratch
| was better, why wouldn't we be doing it voluntarily at
| frequent intervals? It just seems easily dismissed as
| entirely incorrect.
|
| > The economy is growth dependent and can only perform
| its basic functions under growth, even if that growth is
| fake.
|
| I don't think this describes the economy, it just
| describes some of the metrics we use to gauge the health
| of the economy. burning down the internet and killing
| everyone that understands it might result in another
| dotcom boom, but would you say the economy is more
| healthy than some other reality where the internet
| continued to exist with no reset and only has smaller
| incremental gains?
| Cornbilly wrote:
| >The truth is economic growth hasn't been occurring in real
| terms for most people for a long time and the rich have been
| transferring money from the poor to themselves at a dramatic
| rate.
|
| The US is setting up to make this worse by cutting services for
| the average person (like the CFPB and OSHA) and continuing to
| give tax breaks to the wealthy...again.
|
| This is after the same group of people set off sky-rocketing
| inflation by injection almost a trillion dollars of new money
| into the economy by way of the PPP program, of course hurting
| the average person more than their wealthy financial backers.
| matthewdgreen wrote:
| Medicaid cuts are going to be the real nightmare fuel. People
| think Medicaid is for the poor (which some Americans are
| always happy to screw over) but Medicaid is what makes it
| possible for many working folks' parents to afford geriatric
| care. God knows what happens when the GOP succeeds in
| slashing it.
| Cornbilly wrote:
| My guess is that all of this moronic fiscal policy causes a
| significant recession by the next presidential election.
| thrance wrote:
| At this point I've fully converted to accelerationism. I
| can only hope this recession happens soon and rid us of
| this circus quickly.
| rezonant wrote:
| Medicaid is indeed for persons under the poverty line.
| _Medicare_ is for people 65 and older. Not that I think
| they 'll stop at Medicaid.
| matthewdgreen wrote:
| A huge percentage of Medicaid goes to nursing homes.
| Medicare does not fully cover the service. You either pay
| out of pocket or if you're destitute (as many elderly
| people are) you get Medicaid to cover the difference.
| matthewdgreen wrote:
| Also I want to add to this in case people don't
| understand:
|
| End of life care is a giant vacuum cleaner designed to
| move wealth out of families. It is incredibly depressing.
| Because Medicare does not fully cover nursing homes, you
| have basically two choices:
|
| 1. Give up a huge percentage of your family's assets
| (home, retirement savings etc.) so that it never gets
| handed down to kids and grandkids. 2. Gift those assets
| early (at least five years I think) so you are
| technically broke and then can qualify for Medicaid.
|
| Even if you don't gift those assets early, many people
| will still run out of money because they aren't wealthy.
| So they'll also end up on Medicaid.
|
| People have the very dangerous impression that "Medicaid
| is for the poor and Medicare is for the rich" and oh hell
| are they about to make a terrible mistake.
| insane_dreamer wrote:
| That's a misunderstanding that many people have.
|
| Medicare does _not_ cover nursing and long-term care
| facilities for the elderly. That is covered by Medicaid.
| zusammen wrote:
| You're probably right. The historical norm is that there are
| owners and there are workers. We seem to be regressing to that.
|
| The difference is that medieval peasants knew their manorial
| lords had bigger houses and ate more meat, but the visible
| local differences were small and religion could operate (for
| worse or better) as a stabilizing force. People tolerated a
| caste system because they were information poor.
|
| There's no reason today, though, for people to put up with the
| kind of inequality that is not only extreme and senseless but
| constantly being shoved in their faces via social media. The
| only way the rich stay out of the guillotines is by creating
| new, weird cultural spectacles like litter boxes in schools
| (not even a real thing) for "furry kids."
| munificent wrote:
| They were uninformed then, but people are misinformed now.
|
| I think the latter is worse, because it means those in power
| now have an information lever they can use to manipulate the
| masses. When there were no broadcast or network media
| sources, those levers didn't exist and the powerful had fewer
| tools to control people.
| rixed wrote:
| Or diverting nascent discontentment toward a manufactured
| enemy (that does the same in his own fiefdom), 1984's style.
| mandmandam wrote:
| > The historical norm
|
| By which you mean the most recent 1% or so of human history.
|
| Before that societies were a lot more egalitarian [0].
|
| 0 - https://medium.com/inside-of-elle-beau/yes-our-ancient-
| ances...
| api wrote:
| The new way to sell the lower and middle classes on
| persistent inequality and a caste system is the culture war.
| You scare them about culture war bogey men: trans people,
| immigrants, gays, etc. The deal is "let us rule over you and
| tax you and charge you rent, and we will marginalize people
| whose existence disturbs you."
|
| A closely related variation is the appeal the current
| oligarch class is making to men all over the world: let us
| rule over you and tax you and we will keep women in their
| place and set things up so you have most of the power in
| relationships. Men get to rule over women, and in exchange
| the oligarchs get to rule over men and take most of their
| productivity in rent and taxes. You're poor, but your wife
| can't leave.
| thrance wrote:
| I would hardly call that strategy "new", it was the same
| one employed by European autocrats in the 30s.
| eli_gottlieb wrote:
| > People tolerated a caste system because they were
| information poor.
|
| Well no. Peasant rebellions/uprisings happened all the time.
| People tolerated the feudal system because those rebellions
| could at best pressure for greater leniency within the
| system, while it took the later historical developments of
| urbanization and increasing labor productivity to actually
| overthrow the system.
| thrance wrote:
| Workers have been sold the lie that if they work hard and
| smart, they too can get to the top and enjoy a life of
| luxury.
|
| Relentless propaganda on social and legacy medias funded by
| billionaires succeeded in creating the most overtly pro-
| billionaire government ever.
|
| They are now giving themselves massive tax cuts, implementing
| austerity and straight up picking in the treasury, _and a lot
| of Americans are still defending them_.
| adverbly wrote:
| > rich have been transferring money from the poor to themselves
| at a dramatic rate
|
| Anyone not familiar with it needs to look up Georgism.
|
| This transfer happens primarily via housing costs and rent
| payments.
|
| The stratification of the rich happens via investment
| opportunities, but the core underlying mechanism for the
| majority of the population is via housing costs and Ricardo's
| law of rent.
| hnthrow90348765 wrote:
| Yeah, you can't have an realistic economy that will
| eventually inflate small, entry-level houses to $1mm+ and
| college costs to the $100k's but still have jobs paying
| $10-20/hr (or less). Any kid who does the math will realize
| how hopeless that economy is. Even if you scrape by, one
| emergency turns you into a debt slave.
|
| Housing needs to stop increasing in price for a number of
| generations. Surely the rich can find someplace else for
| their money.
| jarsin wrote:
| And then there's Australia.
| btilly wrote:
| For housing to stop increasing in price, a lot of it has to
| be built.
|
| The YIMBY movement is pushing in the right direction, but
| doesn't have the political power that they need.
| Particularly in California. And, as long as they don't,
| those with houses will continue to win against those who
| don't.
| adverbly wrote:
| > For housing to stop increasing in price, a lot of it
| has to be built.
|
| False.
|
| You can depress the land-based monopolistic component of
| housing via a land value tax. If speculating on land
| values stops being a good investment strategy, the price
| will drop.
|
| Many economists/nobel prize winners have been quietly
| pointing this out for over a century at this point. Here
| is a pretty good primer:
| https://www.youtube.com/watch?v=smi_iIoKybg
| btilly wrote:
| As long as there are more people needing housing than
| housing, prices will be high. California has such a
| shortage, and the people side of the equation is going up
| faster than housing is constructed. Making the problem
| worse over time.
|
| A land value tax could indeed help with housing costs -
| but that's because it encourages development. It is the
| construction that makes the really big difference here.
| adverbly wrote:
| Correct. Thank you for clarifying. Just want to point out
| that this is different from your initial claim.
|
| > housing to stop INCREASING in price
|
| Land value tax would immediately start decreasing the
| housing price. You are correct that it would stay high
| until demand and supply rebalanced, but it would start
| decreasing.
|
| In fact, you actually pointed out a second mechanism that
| could lead to decreasing prices in your comment: a
| decrease in demand. As you mentioned, that decrease in
| demand could come from a decline in population. However,
| it could also come from a decrease in that population's
| capability to match their existing level of spend. People
| can't spend more than they have so if that amount goes
| down then prices would also have to go down as a result.
|
| In fact, prices for housing are far more sensitive to
| changes in demand than for normal goods. Land supply
| supply is fixed and cannot increase. But likewise, it
| cannot decrease either and this is what makes land value
| tax so amazing! Normally, a decrease in price would lead
| to a decrease in production, but with land, supply never
| changes so you get a larger decrease in price.
|
| Economists refer to this property as having zero
| deadweight loss, and it is what makes land value tax the
| most efficient theoretical tax possible as was mentioned
| by Adam Smith over 100 years ago. Effectively, you can
| tax land up to its full theoretical rental value and
| supply will never change.
|
| Land is an economic edge case. It's like a massive glitch
| in normal economic assumptions. And that glitch is
| literally the largest asset class globally and makes up
| the majority of bank lending. It needs special attention
| that it's not currently being given.
|
| Practically speaking, land value tax advocates are not
| proposing full rental capture, but rather first replacing
| property taxes, and slowly increasing the tax rate while
| decreasing other taxes.
| btilly wrote:
| No, my initial claim is correct. Per https://en.wikipedia
| .org/wiki/California_housing_shortage, _" California
| needs to double its current rate of housing production
| (85,000 units per year) to keep up with expected
| population growth and prevent prices from further
| increasing..."_.
|
| A land value tax by itself would not suffice to
| immediately change this dynamic.
| adverbly wrote:
| I think we disagree here then. The article you linked
| assumes no land value tax so I don't think it's relevant.
|
| My claim that land value tax would decrease property
| prices does admittedly depend on the tax rate. Do you
| dispute the fact that there is some tax rate where house
| prices would decrease? For example, going above 100% tax
| rates would actually force people off land so to me this
| seems obvious because clearly nobody would want to hold
| property if it cost more to hold than they could
| afford... So obviously there is some tax rate lower than
| 100% where property prices would start to decrease even
| accounting for other growth factors. Heck, you could even
| ignore it being a land value tax. This would happen with
| a property tax as well.
|
| Does that make sense?
|
| Keep in mind that the number that you quote there in the
| article would obviously change depending on the price of
| housing. People move out of cities or countries all the
| time due to cost of living.
|
| EDIT: this seems pretty straightforward to me. It's a net
| present value calculation with an annual payment.
| Obviously there is some annual payment where net present
| value will decrease...
| btilly wrote:
| My claim isn't about housing prices. It is about the cost
| of housing. True, a land value tax transfers value from
| property owners to the government. But paying that tax
| represents a cost of housing. Either directly - you're
| paying tax on your property - or indirectly in the form
| of rent.
|
| In theory this is net neutral on costs. In practice, it
| is likely to be an increase immediately because housing
| prices tend to be "sticky". So it takes time for land
| value to drop because of the tax.
| adverbly wrote:
| Ahh that makes sense then. Yep agreed! I got confused
| because I usually hear people refer to housing prices as
| property purchase prices, and housing costs to the
| continuous component. I would have phrased this:
|
| > For housing to stop increasing in price, a lot of it
| has to be built.
|
| As
|
| "For housing costs to stop increasing, a lot of it has to
| be built."
|
| It's difficult and ambiguous either way though... Costs
| being plural and price being singular is maybe what threw
| me off as well?
|
| Thanks for clarifying!
| amscanne wrote:
| I think a common mistake (and one you're doing here) is
| implying those things are fixed measurements. The common
| definition of a "small, entry-level" house has dramatically
| inflated over the last 70 years. When people compare to
| their parents generation, it's not at all apples to apples
| -- those houses were about half the size and much, much
| shittier and cheaper.
|
| Similarly, college has become a thing that went from <40%
| of high school graduates prior to the 1950s, to 80-90%+
| today. The demand has increased enormously, so of course
| prices has gone up.
|
| Isn't the point of markets to provide feedback and change
| behaviors? Live in a smaller house, go into trades instead
| of college, etc. (like many in the last generations did, in
| reality). Instead, everyone is trying funnel into the
| patterns that had the most success in the past, leading
| those to become oversubscribed and not working as well.
| DarkNova6 wrote:
| Money is power, and power needs to be in checks.
|
| "Billionare" is not a word which should exist.
| tmn wrote:
| We are not far off from trillionaires. Saying billionaires
| shouldn't exist at this point sounds pretty radical to spin
| in positively
| cscurmudgeon wrote:
| An easier solution would be money not being power.
| munificent wrote:
| _> people only seem to demand a fair piece of the wealth after
| a world war._
|
| I think it's more that war has a tendency to literally destroy
| capital which is effectively a tax on the rich. When factories
| get bombed, factory owners lose out more than people who don't
| own factories.
|
| War is horrible but it historically has at least been somewhat
| of an economic equalizer.
|
| One of the real tragedies of the pandemic was that it turned
| that upside down. The virus didn't touch capital but destroyed
| humans, and the humans hit the worst were those in "essential"
| but low-paying jobs who couldn't socially isolate. The effect
| was that the pandemic increased economic inequality.
| ianferrel wrote:
| Are you sure it's true that the pandemic increased economic
| inequality?
|
| The humans worst hit were _by far_ the elderly, and the
| elderly tend to have more assets than the young in
| industrialized countries.
|
| Among working-age people, lower-paid "essential" workers were
| exposed to more risk, but by a significant margin, _old_
| people are the ones who died more.
| sockbot wrote:
| Individual old people may have died more, but we are
| talking about economic inequality. They had huge gains in
| their wealth due to asset inflation. Working people were by
| far the worst hit by the devaluation of their labour.
| Vegenoid wrote:
| > Are you sure it's true that the pandemic increased
| economic inequality?
|
| Yes, the wide majority of economic data suggests this.
| jgord wrote:
| Thomas Piketty lays it all out in "Capital in the 21st Century"
|
| Basically he compares two kinds of growth rates : the growth
| rate of the 'real' economy and the growth rate of wealth
| itself. You need the wealth rate to be low enough that rich
| people want to invest some of it in the real world, not leave
| it in the bank.
|
| If you do tax the rich, they do very well and you also have
| money to pay for things like education, roads, affordable
| housing, medical services, scientific research .. which benefit
| all and lubricate the general economic market.
|
| If you dont tax the rich, you end up with a gilded age of
| emperors and kings or a few robber barrons, a small rich
| coterie around them and the gawping masses of poor eeking it
| out.
|
| Postwar 70s and 80s were a unusual period of relative lower-
| inequality, in which we had money in the real economy to
| develop things.
|
| Garys Economics made an interesting point that inequality
| _itself_ is a problem - because the actual real value of the
| world remaining the same [ goods, energy available, land,
| workers, housing, technology ], when there is higher
| inequality, then the poor are losing a proportion of that real
| wealth to the rich. Extreme inequality itself starves almost
| all the population of a share of real wealth, for them to use
| their skills effectively - renovate a house, invest in stocks,
| get a masters degree, do a garage project, travel, have kids,
| install solar panels etc.
| mrjin wrote:
| Even if you try to tax the riches, they have billions of ways
| to evade it. The tax laws are so complicated for a reason.
| Here in Australia, there were cases that some individuals
| that earned just about A$1M pa., and they paid ~A$980K to
| companies registered in Virgin Islands etc. for managing tax
| affairs. Such arrangement knocked down their taxable income
| to ~A$19K, and thus they paid probably a couple of dollars
| taxes if not not even a dime. Eye-opening, right? But those
| were not those super rich ones. You can just imagine what
| those super rich people can do. So the burden of the tax
| would be on mid-income people. I would expect the same in US.
| idle_zealot wrote:
| If there were political will to tax the rich then you'd
| have to, in addition to changing tax law (obviously), fund
| IRS investigations to ensure the taxes are actually
| collected. Throwing up your arms and saying "well we can't
| tax the rich, they're too powerful and wily, and will
| easily commit tax fraud to evade those taxes, and in
| actuality you'll bring in less money" is exactly the weak
| attitude that stalls efforts to fund vital services. If you
| think people will commit tax evasion, then _put more
| resources into investigating tax evasion_. Historically,
| money spent recovering taxes has yielded more than the cost
| of said investigations.
| CrossVR wrote:
| > Throwing up your arms and saying "well we can't tax the
| rich, they're too powerful and wily, and will easily
| commit tax fraud to evade those taxes, and in actuality
| you'll bring in less money" is exactly the weak attitude
| that stalls efforts to fund vital services.
|
| It goes further than that, it is the exact argument made
| by wealthy people as to why we shouldn't tax them more
| aggressively. Parroting that argument is ludicrous unless
| you're considerably wealthy yourself.
| mrjin wrote:
| Those loopholes were by design, complicated enough to
| prevent most people like us to take advantage of it but
| will allow those who can afford to evade lots. I'm not
| sure if people is just naive or playing dumb.
| bloppe wrote:
| If only there were some way to change a tax code... Alas,
| no country has ever figured out how to do that!
| johnnyanmac wrote:
| We have a way... oh, they have spent 20 years in gridlock
| arguing over political lines. And the Rich apparently won
| given the current proposal.
| bloppe wrote:
| You heard it here first. There will be no tax reform from
| here on.
| thfuran wrote:
| Why not? The billionaires are still paying some tax.
| thfuran wrote:
| And evil if you are.
| mrjin wrote:
| My point was that Tax Laws were deliberately complicated
| to allow some people to evade taxes. If you put that into
| consideration, you will find it's a lot easier to
| understand the status quo. Again, what you think or what
| I think do not matter after all.
| johnnyanmac wrote:
| It matters completely. Congress makes and changnes tax
| codes, people vote in congress. People need to remember
| they are the ones being served and they are in control.
| Absolving themselves of their representative's choices is
| the start of the downfall of the system.
| mrjin wrote:
| It should matter, but it actually doesn't matter as much
| as you thought as there is a level of indirection.
|
| Just look back to the promises made before the election,
| how many were never fulfilled?
| hello_moto wrote:
| This is because we continuously being divided with lesser
| pressing issues: abortion, same-sex, universal toilet,
| etc.
|
| The left or right are the same side of the coins that the
| rich will support no matter what.
|
| They shun people like Bernie Sanders, Picketty, etc.
|
| In USA, social programs = socialists = commie.
|
| That's how bad the brainwashing is.
| mrjin wrote:
| There is a level of indirection as it should. But that
| indirection also adds distortions.
| benterix wrote:
| It is extremely difficult because you not only need to do
| it on a per-country level, but globally. Otherwise you
| just punish foreign companies that genuinely invest in a
| country with stricter tax laws (and most will just choose
| another country, just like it's happening in Europe). And
| ultimately, it depends on the will of the American
| administration - and they can be extremely bullish about
| imposing their laws on smaller countries, sometimes even
| using their military advantage.
| ashoeafoot wrote:
| The world is degloballuzing rapidly and yiu really can
| not anything in a dictatorship or oligarchy. Look at
| those falling out of favour in Russia .
| wood_spirit wrote:
| s/favour/windows/g
| MeteorMarc wrote:
| As long as political campaigns are funded by the rich,
| there will be no political will to tax the rich.
| photonthug wrote:
| > fund IRS investigations to ensure the taxes are
| actually collected.
|
| Even people who want to tax the rich are skeptical about
| empowering / funding the IRS because there are many
| studies showing that the IRS disproportionately audits
| the poor.
|
| If that's true, then why would more funding help new
| enforcement against the rich rather than multiplying the
| current problem? Generally cash/support fixes material
| resource issues but cannot fix policy issues
| ianburrell wrote:
| IRS enforces against the poor because it is easier and
| they have been directed that way. It is possible to
| increase enforcement, direct where that enforcement goes,
| and change the law so that it is easier to enforce
| against the rich. Another would be simplify the law for
| to make audits for poor unnecessary and leave rich fewer
| places to hide.
|
| We have gotten used to Congress being dysfunctional and
| not passing laws that we think the current laws are some
| unchangeable state.
| photonthug wrote:
| Sounds like we agree then that it's important to change
| policy first before dumping more resources on a
| malfunctioning org and hoping for the best. But parent
| mentions "funding investigations" as a cure.. my point is
| just that there's no indication that this makes things
| better, and might actually make them worse.
| mkatx wrote:
| I do agree that changing policy is a separate, yet
| complimentary, step. But maybe the poor are
| disproportionately audited because the IRS doesn't have
| the funding to effectively target the rich and succeed?
| Maybe with better funding, they could successfully
| extract more tax dollars from the rich, incearsing the
| ROI of funding the agency?
|
| I don't think further funding the agency is a completely
| nutty idea. Although if you truly believe the agency is
| broken, and that being broken isn't related to their
| funding, then I could understand your perspective. I lean
| more towards the idea that at least some, maybe even
| most, of the issues they have might be due to a lack of
| funding. That makes more sense to me than most of the
| criticisms I've heard of the IRS, which seem to mostly be
| on partisan idealism framed as otherwise.
| smallmancontrov wrote:
| "You can't possibly defeat me, why do you even try?"
|
| Come on. You have fallen for cartoon-villain level smack
| talk. Chew it up, spit it out. We've done this before and
| we can do it again.
| jjtheblunt wrote:
| Can that class of scams be foiled with consumption tax ?
| stvltvs wrote:
| Consumption taxes are almost always regressive, hitting
| the poorest the hardest. Depends on how you structure
| them.
| jjtheblunt wrote:
| Good point
| frontfor wrote:
| Two points here:
|
| 1. Gary's arguments for taxing the rich aren't about taxing
| income. It's about taxing _wealth_.
|
| 2. By his argument, most of the wealth are immovable: the
| rich disproportionately owns actual, physical real estates,
| and stocks of actual companies. As these assets are based
| in the country, you could tax right at the source.
| tastyfreeze wrote:
| So the government takes physical assets? Didn't we fight
| a war over property rights?
|
| My neighbor is way wealthier than me. So its ok if I take
| his car. He has enough he can just buy another one.
| kiwih wrote:
| Please respond to the strongest plausible interpretation
| of what someone says, not a weaker one that's easier to
| criticize. Assume good faith.[0]
|
| [0] https://news.ycombinator.com/newsguidelines.html
|
| I think a more reasonable interpretation might be "the
| government knows about expensive cars (i.e. that they are
| registered, have numberplates etc), and so charges some
| annual tax on the owners of those cars."
| tastyfreeze wrote:
| Describing wealth tax reasoning with an absurd example of
| the same reasoning on an individual level is an attempt
| to get people to understand what wealth taxes are.
|
| The government that is supposed to work for you thinks
| you have accumulated too much stuff and is trying to make
| it legal to take a percentage of your physical wealth
| annually.
| toomuchtodo wrote:
| You only accumulated and maintain the wealth because of
| the government. Without the government and the economic
| system it cultivates, you'd never have it.
| southernplaces7 wrote:
| >You only accumulated and maintain the wealth because of
| the government
|
| This is simplistic nonsense. No, the majority of wealthy
| people didn't accumulate their wealth because high and
| mighty lord government willed it into their existence.
| They did it within a system of laws and regulations that
| government admittedly does create for fostering such
| wealth creation. However, this still often requires
| strenuous effort by these people for their own ends. If
| it were otherwise, many more people would be rich just by
| virtue of living under a government. There is a real
| place for giving people credit for the wealth and capital
| accumulate, well beyond what government offers.
|
| It's contradictory and absurd to argue that people
| accumulate wealth because of the government while at the
| same time arguing that we live in a situation in which we
| need more government control of people's earnings to
| prevent oligarchy since government doesn't do enough.
| Rumple22Stilk wrote:
| Your argument is built on a flawed premise that ignores
| the foundational role government and society play in
| enabling wealth creation in the first place. The
| counterfactual is simple: without government, without the
| legal and social structures upheld by a functioning
| society, there would be no stable mechanism for
| accumulating wealth at all.
|
| Wealth does not exist in a vacuum. It is not some
| inherent trait of individuals that manifests
| independently of the structures around them. The
| wealthiest people succeed not just because of their
| individual effort but because they operate within a
| framework that provides enforceable contracts, property
| rights, regulated markets, financial systems,
| infrastructure, security, and a workforce educated by
| public institutions. Strip all that away, and they are no
| better off than anyone else in a lawless wasteland where
| power is dictated purely by brute force.
|
| If wealth were purely a function of individual effort,
| we'd see people amassing fortunes in failed states or
| ungoverned regions where there is no government
| interference--but we don't. In fact, in those places, the
| absence of government results in instability, extreme
| poverty, and the inability to conduct large-scale
| business. Conversely, the wealthiest individuals
| overwhelmingly exist in places with strong institutions
| and legal protections--because those things are
| prerequisites for wealth accumulation.
|
| Your contradiction is actually the real contradiction.
| You claim that people become rich despite the government
| but then ignore the fact that wealth is unequally
| distributed precisely because the government does not
| intervene enough to prevent market capture by a small
| elite. A government that enables wealth creation is not
| the same as one that ensures it is fairly distributed. It
| is perfectly consistent to acknowledge that wealth
| requires government structures while also recognizing
| that unchecked capitalism leads to oligarchy.
|
| So no, this isn't simplistic nonsense. The simplistic
| nonsense is pretending that wealth creation happens in a
| vacuum when, in reality, it is entirely contingent on the
| existence of an organized society with functional
| institutions.
| goodpoint wrote:
| > strenuous effort by these people
|
| strenuous effort by their employees or are you telling me
| that the average billionaire works 50000 hours a day?
| AlexandrB wrote:
| To steelman the argument that wealth is earned, this kind
| of stuff tend to follow a power law. So a 10% increase in
| effort or talent can result in a several fold increase in
| wealth - especially when the effects of compounding
| interest are considered.
|
| This is most apparent in sports or the arts. Being just a
| _little bit_ better at baseball can be the difference
| between a million dollar contract and being stuck in the
| minor leagues.
|
| Of course the question of whether we should want success
| to follow a power law is a different matter. As is the
| role of luck. Going back to the sports example, being
| born at the right time of year can be a huge, permanent
| advantage[1].
|
| [1] https://medium.com/@connorbaldwin28/why-athletes-
| tend-to-be-...
| ToucanLoucan wrote:
| > No, the majority of wealthy people didn't accumulate
| their wealth because high and mighty lord government
| willed it into their existence. They did it within a
| system of laws and regulations that government admittedly
| does create for fostering such wealth creation.
|
| This is akin to saying you only achieved a high score in
| a video game by your own sweat and effort, and saying the
| video game developer had nothing to do with it. Without
| their work, you wouldn't have a system within which to
| accrue wealth. You may not even have the concept of
| wealth or property. Bezos wouldn't have his wealth
| regardless of himself creating amazon if there didn't
| already exist power grids to electrify his warehouses and
| data centers, roads upon which his delivery vans could
| travel, a financial sector to see him be paid for his
| goods, on and on and on.
|
| The mythmaking of the self-made-wealthy has gone
| completely off the fucking deep end at this point with a
| portion of the population, as if these CEOs fell from the
| sky, cratered in the Earth, raised their arms and from
| them spawned hyperscaler businesses and cavemen left
| their campfires, picked up Macbooks and started writing
| React code.
|
| > It's contradictory and absurd to argue that people
| accumulate wealth because of the government while at the
| same time arguing that we live in a situation in which we
| need more government control of people's earnings to
| prevent oligarchy since government doesn't do enough.
|
| This is not contradictory at all unless you boil the
| points down utterly beyond recognition.
| bad_haircut72 wrote:
| Most cancers didnt grow because some high and mighty body
| willed it into existence, they did it within a system of
| biological laws and conditions that admittedly the body
| does generate
| ok_dad wrote:
| Property taxes are a thing. If Joe Dirt has to pay
| property taxes for the home he shelters in, the wealthy
| should have to pay property taxes for the shares of a
| company that they use to secure loans for yachts and
| Ferraris.
| Clubber wrote:
| A fix would be if you use unrealized capital to secure a
| loan, that unrealized capital amount to secure the loan
| becomes taxable. Of course that would tax people trying
| to get home equity loans though.
|
| The problem is that people will always probe the tax code
| for loopholes that weren't considered. It's a cat and
| mouse game, except the cat is fat and lazy, and gets paid
| by the mouse.
| AutistiCoder wrote:
| you could create an exception: if you have <= $1M in
| unrealized capital gains, those assets are not subject to
| unrealized gains tax.
| saalweachter wrote:
| Eh, an exception for a primary home is common throughout
| the tax codes and the like. Just saying you realize
| capital gains on an asset used to secure a loan (unless
| it's a primary residence) would cover that without being
| out of step with everything else.
|
| Sure, a billionaire could then use their $143M estate as
| collateral on a loan to avoid realizing the capital
| gains, loophole, but since you can only have one primary
| home, it's a very limited loophole.
| epistasis wrote:
| The really great thing about taxing land, is that it
| can't escape where it is. Capital flight is a risk for
| taxing other forms of wealth.
|
| And land is something of finite quantity that is actually
| taken away from the rest of society. Capital is produced,
| and made, and is not finite like land.
|
| This is one thing that California got really wrong, it
| should be taxing land heavily, and income less.
| pqtyw wrote:
| > it should be taxing land heavily, and income less.
|
| Wouldn't that inflate housing prices even more? Which
| disproportionally affect those in the bottom 90% or so.
| AlexandrB wrote:
| Not an economist, but not necessarily. A heavy land tax
| would discourage buying real estate as an investment
| vehicle which might help drive prices down (or at least
| slow the rate of growth). It would also discourage
| leaving rental units empty.
| ok_dad wrote:
| I've always been in favor of a land tax like the
| Georgist's describe.
|
| I still think property taxes on stocks should be a thing.
| Americans pay income taxes from foreign sources, so why
| shouldn't the rich also pay the same for overseas
| investments? Just close the loopholes with simpler tax
| laws. That could be like saying it isn't hard to program
| some feature into software, though, so perhaps not.
|
| Example: "Thou shalt pay 0% of all income and assets up
| to 20k, 10% to 50k, ..., and 95% on up to 20mm."
| baby_souffle wrote:
| > So the government takes physical assets?
|
| Not quite. If you are ultra wealthy because you happen to
| own several large buildings, fleeing the country to avoid
| taxes is easy. Doing so with you wealth, however, isn't.
| ty6853 wrote:
| Which is why they will leave with mobile wealth before
| the act goes into effect, taking away the capital workers
| use to earn a living. Property taxes on land and fixed
| structures work well as they cant run away in a practical
| way.
| blackjack_ wrote:
| Not totally. The wealthy are incredibly heavily invested
| in our economy. Take Elon Musk for example. He's heavily
| invested in SpaceX, Tesla, and Twitter. If he walks away
| from the US, Tesla, Twitter, and SpaceX are all still
| here and can't easily "run away". Sure, they can take
| some "mobile wealth", but if you are very wealthy you
| can't just leave a whole economy (that's where your
| wealth is).
| auggierose wrote:
| Elon realised that as well. That's why he is in the oval
| office now.
| ty6853 wrote:
| Elon came here under a similar story. The party in
| significant power cheers on 'kill the boer [farmer]' (
| and 'redistribute' their capital to the poor). He escaped
| to here. It's admirable he wants to prevent America
| becoming like South Africa.
| Ray20 wrote:
| The problem with that politics is stagnation. It is hard
| to move SpaceX and Tesla out of the country, but you
| don't get new companies in this situations, there will be
| less competition and, as a consequence, Elon Musk get
| more power, and there is nothing you could do about this.
| PaulDavisThe1st wrote:
| > He's heavily invested in SpaceX, Tesla, and Twitter.
|
| You make it sound as though he put a lot of his own money
| (somehow obtained from elsewhere) into these companies.
|
| But that's not true at all. It is correct English to say
| that he is "heavily invested" in these companies in the
| sense that his wealth is paper wealth based on the
| perceived value (stock price) of these companies.
|
| But he is not invested in them the way that a typical
| person has their retirement funds invested in a company
| or mutual fund.
| ty6853 wrote:
| Elon got started with zip2 when South African socialists
| induced capital flight causing elons dad to send his
| money and Elon to the USA/Canada.
| andy_ppp wrote:
| The means of production is still here, what's left of it.
| Lower asset prices will benefit the poor. What should
| have happened during COVID is the government took a
| percentage of businesses to the cost of lockdown/furlough
| (if they were of a certain size) rather than subsidising
| the asset hoarding class at the expense of workers. Then
| you give the workers part of these businesses, spend the
| rest on re-industrialising. It would have caused the
| biggest economic boom in the UK maybe ever and with all
| these consumers available to buy things you'd get a lot
| of investment and some people would use some of this
| wealth (PS1tn in the UK alone, about PS15k for every
| adult and child in the UK) to start small businesses
| creating an even better economy.
|
| It's got to be worth a try rather than the disastrous
| economic policies that got us here.
| danenania wrote:
| The US already claims tax dominion (for its citizens)
| over the whole world. You get the foreign earned income
| exclusion, and you can also avoid double taxation in many
| countries that have a tax treaty with the US, but
| otherwise the default is that you need to report and pay
| income tax on worldwide income, no matter the source and
| no matter where you are a resident.
|
| In the same vein, if the US were to implement a wealth
| tax, the simplest way in terms of enforcement and not
| creating perverse incentives to shelter wealth outside
| the country would be to make it international in scope.
| Yes, people could give up their citizenship, but that's a
| huge sacrifice which most wealthy people would not want
| to make at any price, and there's already an exit tax in
| place for people that do this.
| ceejayoz wrote:
| > Didn't we fight a war over property rights?
|
| We just wanted to be the ones setting the rules.
|
| We were quite quick to put our own stamp on the populace.
| https://en.wikipedia.org/wiki/Whiskey_Rebellion
| mjmsmith wrote:
| I can think of two wars over property rights.
| mrjin wrote:
| Yep. Get your points. They can if they wish. The question
| is do they want to? If so, why were those loopholes there
| in the first place?
| SJC_Hacker wrote:
| Yes, the only thing that genuinely scares the rich is
| wealth taxes.
|
| It is next to impossible to hide the fact that someone
| owns something like real estate
|
| In addition to real estate I might consider other
| property such as bank accounts, at least above a certain
| threshold. Presumably that cash has to be invested
| somewhere (or should be encouraged to do so)
|
| If we could get a real wealth tax, I would do away with
| income taxes like some states have done (i.e. Texas)
| TeaBrain wrote:
| >It is next to impossible to hide the fact that someone
| owns something like real estate
|
| Real estate can already be taxed via property taxes.
| Unrealized gains in securities can't be taxed the same
| way as their value is much more volatile, with
| potentially large daily swings. Texas makes up for the
| lack of income taxes with relatively high property taxes.
|
| >In addition to real estate I might consider other
| property such as bank accounts, at least above a certain
| threshold.
|
| Interest from savings accounts is already taxed. The
| wealthy don't hoard their wealth in bank accounts though.
| danenania wrote:
| While it doesn't make sense to tax unrealized gains, they
| could be taxed if they are used as the basis for a loan.
| Loans on unrealized gains are one of the main ways the
| wealthy are able to live lavishly while paying very low
| effective tax rates.
|
| It seems fair that you shouldn't be able to have it both
| ways--if you are getting any financial benefit from an
| asset, including a loan, there's a pretty strong argument
| that you yourself are "realizing" that value.
| TeaBrain wrote:
| The property or goods purchased with a loan are subject
| to tax.
| danenania wrote:
| Sure, but everyone pays those taxes. If we are talking
| about inequality and the wealthy having ways to get out
| of (or better said, drastically reduce/defer) taxes that
| everyone else has to pay--i.e. income tax--I think loans
| on unrealized assets is probably the first thing to look
| at.
| TeaBrain wrote:
| Banks are also taxed on the interest from the loans.
| Loans backed by assets are not just free untaxed money as
| you seem to think they are. If an entity is unable make
| the payment on a bank loan, then they would be subject to
| having their collateral seized, and the bank would then
| eventually sell the assets, which would be subject to
| capital gains.
|
| I think it would be more realistic to heavily tax
| inheritance and re-evaluate trust based loopholes.
| danenania wrote:
| > Loans backed by assets are not just free untaxed money
| as you seem to think they are.
|
| I mean, you're clearly moving the goalposts here. We're
| talking about tax on unrealized gains for the wealthy,
| not sales tax, property tax, or taxes on the bank.
|
| If you're able to keep taking out new loans to pay off
| the old loans until you die, with an appreciating
| "unrealized" asset as collateral, then yes all that money
| is effectively tax free if we're talking about income tax
| and capital gains.
| paddez wrote:
| Unrealized gains can be taxed - for example, Ireland has
| a Deemed Disposal tax on ETF investments, where after 8
| years, any gains are considered to have been realized and
| tax is due (even if no sale has taken place)
| TeaBrain wrote:
| Deemed disposal subject ETFs can be taxed under an eight
| year exit tax scheme, but this can be avoided by simply
| investing in US domiciled ETFs or individual stocks.
| robocat wrote:
| > scares the rich is wealth taxes.
|
| I'm scared of 2% wealth taxes (as discussed in New
| Zealand) because I believe that will take 100% of
| retirement savings over time. And I'm no
| multimillionaire. Say portfolio returns 6% and
| drawdown(spending) is 4% then 2% takes 100% of gains.
|
| The 1% or 2% figures sound trivial to the voting majority
| but they really are not trivial. Cue discussion on
| compounding.
|
| The other issue is Forcing sale of private owned
| businesses. If you fuck with the incentives to grow a
| businesses, you will end up with a shitty economy and
| everybody suffers.
|
| Apart from the obvious 2% * decades = lots (for low
| growth investments).
|
| I could work to create new high-margin export income for
| New Zealand: I have the skills. But I don't work because
| I hate our taxation system: NZ loses.
|
| An economy needs to incentivise everyone to work
| including the wealthy: otherwise it bombs. It scares me
| to see people in the US want to introduce features to
| cripple their most successful economy. I think most
| workers poorly understand businesses or economic
| incentives.
| wingworks wrote:
| We (New Zealanders) are already getting taxed 1.4% on
| wealth effectively, if your on a tax rate of 30%+ (most
| people).
|
| Most people just don't know about it. Due to the FIF
| rules. Any international investments you have get taxed
| like this (it's not so clear cut, but more or less). The
| only exceptions are NZ investments and Aussie
| investments, maybe. There is a tool to check if an aussie
| share is except from the FIF rules. e.g. Aussie ETFs
| aren't, even if they invest in only aussie stocks...
|
| So everyone with a Kiwisaver (retirement scheme), aka
| most people, have large portion invested overseas, and
| thus are paying the 1.4% p.a.
|
| It also discourages high net worth people from moving to
| NZ, as they usually have investments outside of NZ, which
| will get taxed once they move here (after a few years
| exception).
|
| The small "win" we do get is you can (cost bases) invest
| up to $50k overseas without the 1.4% FIF rules applying,
| (though dividends are still taxed). But like no one knows
| about it, and managed funds can't take advantage of this,
| so most people don't utilize this, especially not low
| income people, who generally aren't that well educated on
| finances.
|
| Don't get me started on our lackluster retirement scheme,
| Kiwisaver, with near 0 tax incentives, and propping up
| the housing market prices.
| adrian_b wrote:
| For the really rich, I agree about the usefulness of
| taxing wealth.
|
| The problem is that such a tax must be strongly
| progressive, or it may affect the poor much more than the
| rich.
|
| For instance, I have seen cases in some countries, where
| after the discussions about the usefulness of such taxes
| for wealth, the result was the establishing of some high
| taxes on property, whose only effects were that e.g.
| someone who were jobless for some time might be forced to
| sell their house, and for a disadvantageous price, for
| not having with what to pay the property tax, thus
| becoming both jobless and homeless, or someone poor who
| inherited a house might be forced to sell it for a
| disadvantageous price, for not being able to pay the
| inheritance tax.
|
| The result of this kind of misguided tax was an even
| greater transfer of wealth from the poor to the rich.
| bjourne wrote:
| But laws shouldn't be set based on how easy they are to
| avoid. Lots of people drive too fast all the time, yet few
| argue that we should do away with speed limits. Besides,
| there is zero empirical evidence that suggests that raising
| rich people's taxes is ineffective. Yes, they are good at
| avoiding taxes, but professional tax collectors are
| probably even better at enforcing taxes. It's a question of
| political will, or lack thereof, due to not wanting to lose
| your biggest donors.
| mrjin wrote:
| You don't cut your own fingers. And that pretty much the
| whole story.
| ItsMonkk wrote:
| I understand this is a tangent but you picked a really
| bad example. We should be trying to remove every single
| speed limit that we can.
|
| If the design speed of a road does not match the speed
| limit of the road, people will drive the design speed,
| cops will learn to sit there all hours of the day waiting
| for people to mess up, and get ticketed. Instead of just
| putting up the speed limit sign, city planners should
| design for the road to be safe without need for the speed
| limits to be in place. This can mean things like reducing
| the width of a lane, could mean speed bumps, to
| purposeful non-straight sections.
| kevinventullo wrote:
| That's a horrible idea. I very much like driving on
| straight wide roads without speed bumps, even if I'm
| going 25mph.
| ItsMonkk wrote:
| If the safe speed of the road is 25mph, and the design
| speed of the road is above 25mph, you will not have
| safety no matter what the speed limit is. Vision Zero
| strategies take these factors into account to ensure
| safety.
| 9dev wrote:
| Bollocks. The only thing that gets you is young and
| reckless drivers going 200mph on the highway, endangering
| everyone around them. There are limits to increasing
| safety in road design, and limits in the reaction speed
| of humans.
| ItsMonkk wrote:
| Yes, this nuance was already included in my previous
| post. Thank you for agreeing with me.
|
| > that we can
|
| Highways are designed to be unsafe by design, so without
| a redesign they require speed limits.
| nrook wrote:
| There's a third choice, though. It's bad when speed
| limits are much lower than the natural speed of the road,
| for the reason you describe. And it's good when the
| natural speed of the road is the safe speed of the road.
| But in addition to those two, it's also possible to
| introduce fast, automated enforcement-- speed cameras.
|
| This, of course, applies just as much to the actual topic
| of the Economist article; new inheritance taxes are just
| and good, but they should be written to be enforceable,
| and then they should actually be enforced.
| ianburrell wrote:
| There will always be people who go much faster than the
| design speed. They are ignoring their and everyone else's
| safety.
|
| I live on major street where the speed limit is 25 to
| slow people down. It used to be 35, and people normally
| go 35-45. The problem is that people go much faster when
| there is no traffic because the street feels wider. I
| would love if they redesigned for a slower speed. But
| there are cars in the middle of the night that drive over
| 60. It doesn't matter if street is calmed, they will go
| super fast and only tickets with slow them down.
| merek wrote:
| Do you have a link?
|
| If the individual resides in Australia, how do they utilize
| the $980k sitting in the foreign company?
|
| The company can buy assets in AU, such as a house, and
| lease it to the individual, but I'm pretty sure the ATO
| requires they pay the company rent at market rate, which
| will likely be unaffordable on a reported income of 20K pa.
| mrjin wrote:
| I remembered I read the article from Australian Financial
| Review, although I could not find the original link, got
| a more detailed one instead.
|
| See Page #3. https://australiainstitute.org.au/wp-
| content/uploads/2020/12...
| lotsofpulp wrote:
| A land value tax would be impossible to evade. Even a
| business's assets will exist somewhere on land. In the case
| of intellectual property, reducing copyright and agents to
| 10 years should solve the problem.
| jjav wrote:
| > The tax laws are so complicated for a reason.
|
| And the reason is those same rich influence the laws to
| their benefit.
|
| It would be pretty trivial to tax the wealth if a society
| wanted to do so. But laws are made by lobbyists, who are
| paid by the rich, so what should we expect.
| Ray20 wrote:
| Mostly it is other way around. People, who influence the
| laws - become reach.
| hcknwscommenter wrote:
| Sounds illegal.
| audiodude wrote:
| I often tell my friends, we can't be wealthy, we still pay
| taxes.
| mrjin wrote:
| Lol. That's probably one of the considerations while
| designing the tax rules.
| staticautomatic wrote:
| This is such a "'No Way To Prevent This,' Says Only Nation
| Where This Regularly Happens" comment.
| WalterBright wrote:
| > they have billions of ways to evade it
|
| In Washington state, they passed a capital gains tax
| primarilly to tax Jeff Bezos. Bezos simply left the state
| just before the tax took effect. So did a lot of other
| wealthy residents.
| supernova87a wrote:
| Why have laws either? Honest people would have not needed
| them anyway, and people seeking to break the law will find
| ways around them.
| quantadev wrote:
| The only way to force everyone to pay is with a consumption
| tax. We'd tax based on consumption so those yachts,
| Rolexes, and home construction, etc. that the rich spend
| crazy amounts on gets taxed.
|
| Of course since a consumption tax hurts the poor
| disproportionately, the gov't would send a refund check to
| them, in large enough amounts to make up for it, where the
| poor are basically paying zero tax.
|
| It also fairly discourages illegal immigration because
| illegals wouldn't get that kickback check from the Gov't,
| since they're 'visitors' not 'citizens'.
| rufus_foreman wrote:
| The problems with Piketty's arguments are addressed in the
| article:
|
| "if America's rich families in 1900 had invested passively in
| the stockmarket, spent 2% of their wealth each year and had
| the usual number of children, there would be about 16,000
| old-money billionaires in America today. In fact, there are
| fewer than 1,000 billionaires and the vast majority of them
| are self-made"
|
| Yes, if rich people invested their money wisely, gave nothing
| to charity, spent small amounts, and left their wealth to one
| of their children, wealth inequality would grow unchecked.
|
| But rich people don't do that.
| matthewdgreen wrote:
| But wealth inequality has still grown quite a bit. Your
| point is not a refutation, it's just an observation that
| the infection has progressed more slowly than it could have
| if it was completely optimal.
| rufus_foreman wrote:
| >> Your point is not a refutation
|
| "there are fewer than 1,000 billionaires and the vast
| majority of them are self-made"
|
| That's a refutation, Piketty made assertions not just
| about the outcome, but about the process by which that
| outcome would happen.
| smallmancontrov wrote:
| So long as rich-get-richer mechanics play out inside of a
| single generation they are unquestionably OK? What even
| is this argument?
| danielmarkbruce wrote:
| he didn't say it's ok. He said piketty is wrong. Anyone
| who studied even econ 101 and combined it with a teaspoon
| of common sense knows piketty is an idiot and that book
| is garbage. He's a politician.
| smallmancontrov wrote:
| No, inheritance isn't the only dubious method of
| accumulation that Piketty described. Try again.
| danielmarkbruce wrote:
| Maybe actually take econ 101 so you can get the thrust of
| the book rather than getting lost in the details. His
| thesis, in that book, is that r > g and that over many
| years that difference results in very large accumulations
| of wealth. No one disputes that there are various means
| that r is achieved.
|
| It doesn't change the thesis, which is wrong. r is not
| greater than g for any reasonable amount of time for
| individuals/families because humans have an amazing
| ability to behave stupidly and reduce r below g.
| Rury wrote:
| Explain your argument because it's not at all clear to
| me. I do not see how that statement refutes the arguments
| the above poster gave.
| tesch1 wrote:
| They're saying that self-made billionaires didn't inherit
| their wealth. Which means they created it. Which means
| that it created useful economic activity. And since rich
| people dont optimally pass on their wealth, those 1000
| billionaires' spawn are likely to piss away that wealth
| while 1000 more economically active individuals create
| more healthy economic activity in pursuit of becoming
| billionaires so that they can pass on their wealth to
| their children to piss away, ad. Inf.
| Rury wrote:
| If that's the argument, then it sounds pretty flawed TBH.
| I mean how does not inheriting their wealth,
| automatically mean they created it? Is theft not also a
| possibility?
| ludicrousdispla wrote:
| The billionaires' spawn pissing their wealth away would
| likely generate a lot of economic activity.
| rufus_foreman wrote:
| Piketty's argument was not just that income inequality
| would increase, but that it would increase because the
| return on capital is greater than the growth rate of the
| economy, so, in his words, "It is almost inevitable that
| inherited wealth will dominate wealth amassed from a
| lifetime's labor by a wide margin".
|
| But inherited wealth does not dominate wealth amassed
| from a lifetime's labor. The largest fortunes today are
| dominated by people who built businesses, not by people
| who inherited their wealth. So if "there are fewer than
| 1,000 billionaires and the vast majority of them are
| self-made", that is a direct refutation of Pikkety's
| thesis.
|
| It is hard to overstate just how bad Pikkety's arguments
| are. His argument assumes single inheritance of fortunes,
| it assumes that wealthy people don't donate significant
| sums to charity, it assumes that inheritors of wealth
| will invest that wealth as wisely as the person who
| created it, along with many, many other false
| assumptions. The most egregious one in my opinion is that
| it assumes the wealthy don't spend their money.
|
| If a billionaire makes a 5% return on his billion dollars
| and spends $50 million dollars a year, does wealth
| inequality increase? No, it does not.
|
| It's a ridiculous theory, it is directly contradicted by
| the facts, and I have no idea why it is taken seriously
| by people here other than just as an opportunity to
| participate in a 2 minutes hate against rich people.
| listenallyall wrote:
| "wealth inequality" is one of the dumbest ways of
| measuring the health of an economy, or to specifically
| aim to reduce. Unfortunately, there will always be a
| baseline group of people at, or near, zero wealth. The
| goal should simply be to reduce this number and the
| overall number of people living in or near poverty.
| Whether Warren Buffett has $50, 100, or 200 billion -
| which does affect wealth inequality calculations - is of
| zero consequence to the lives of the lowest-wealth
| individuals (nor did someone like SBF losing 10s of
| billions, help them)
| istjohn wrote:
| It matters if one person can buy Twitter on a whim and
| use it to pursue his ideological goals, or if one person
| can buy The Washington Post and dictate it's editorial
| positions, or if a small handful of people can fund an
| effort to identify and groom a wide bench of lawyers to
| one day become judges who will bend the law in their
| favor. Not to mention plain old lobbying and campaign
| contributions. When wealth is power, wealth inequality is
| toxic to democracy.
| listenallyall wrote:
| Oh my, individual ownership of newspapers? Bezos bought
| it from Katharine Graham, while the Sulzberger clan has
| owned the NYT for over a century. Scripps, Hearst,
| Pulitzer... how did these names get famous? Newspapers.
| andy_ppp wrote:
| Twitter is much more effective at brainwashing stupid
| people into believing any old crap than newspapers ever
| were, there were journalistic standards in the coverage
| for one thing.
| southernplaces7 wrote:
| So you've managed to blend elitist ideas of some people
| being less or more "qualified" to disseminate certain
| opinions than others who don't share your ideological
| preferences with supposedly egalitarian ideas of reducing
| concentration of power.
|
| Also, journalistic standards, historically, were little
| or not at all better than anything you see online today.
| Yellow journalism was a major part of media since long
| before the internet and newspapers pandering to very
| specific, dishonest biases was also pervasive, but with
| few genuinely unfiltered alternative viewpoints being
| available. The difference today is that a real plurality
| of opinions is finally possible and can be globally made
| visible. The media gatekeepers hate this and thus create
| contrived arguments about an imaginary golden standard of
| media integrity and mass misinformation.
| southernplaces7 wrote:
| >It matters if one person can buy Twitter on a whim and
| use it to pursue his ideological goals, or if one person
| can buy The Washington Post and dictate it's editorial
| positions,
|
| Oh no, now it's important to stop this because some
| people are able to do these things while having political
| viewpoints that you don't like. Were you previously
| making the same argument against say, the New York Times,
| due to it's being owned by one family and following that
| family's specific ideological viewpoints?
|
| Wealth inequality is an innate part of human society, and
| by itself has little bearing on democracy or even overall
| standards of living. There are also many countries with
| low wealth inequality in which democracy doesn't exist in
| any sense.
| TFYS wrote:
| I'm not the person you're responding to, but I'll answer
| that yes, it has always been a problem that so much
| influence is concentrated in so few hands. It's been said
| that a dictatorship would be the best form of governance
| if you could ensure the dictator would always be the best
| one possible. But you can't. When you allow such
| concentrations of power, at some point someone who is
| willing to abuse that power, or someone who is simply
| incompetent, will come along and it's a disaster for
| everybody.
|
| Wealth inequality is not innate; there have been plenty
| of civilizations with far less of it. It's only an
| inherent part of free-market capitalism.
| pqtyw wrote:
| > is of zero consequence to the lives of the lowest-
| wealth individuals
|
| That wouldn't be the case if those at the top were taxed
| and more of their wealth transferred to those at the
| bottom.
| akvadrako wrote:
| Wealth inequality hasn't grown since 1900.
|
| https://wid.world/news-article/inequality-
| across-700-years/
| matthewdgreen wrote:
| Why do people post stuff like this. If your ideology
| depends on misleading people about bad things that are
| obviously happening, just get a better ideology!
| pqtyw wrote:
| No. It decreased massively and then went up again so now
| we're back at where it was back in 1900.
|
| This significantly challenges the "if America's rich
| families in 1900 had invested passively in the
| stockmarket"
|
| e.g. the equivalent of S&P 500 if adjusted by inflation
| was in 1982 was well below it's 1929 peak. Almost all
| growth happened after that.
| Ray20 wrote:
| >But wealth inequality has still grown quite a bit.
|
| This is called stability. The more stable the system -
| the more value have investments.
| snapplebobapple wrote:
| Rich peoples descendants dont do that...
| rufus_foreman wrote:
| Thanks for that correction.
| andy_ppp wrote:
| Yeah brilliant "businessmen" are born into rich families
| and destroy their wealth pretending to be real estate
| developers and managing to be so incompetent you bankrupt a
| casino where the house should _always_ win!
| pqtyw wrote:
| > 1900 had invested passively in the stockmarket, spent 2%
| of their wealth
|
| How is that possible, though?
|
| e.g. according to
|
| https://ofdollarsanddata.com/sp500-calculator/
|
| adjusted by inflation the stock market only grew by 34.10%
| between 1900 and 1982 when adjusted and even if dividends
| were reinvested. And that's total growth, annualized was
| barely 0.36%
|
| Their wealth wouldn't have increase at all during that
| period, especially if they wanted to spend 2% each year.
|
| Of course it accelerated massively in the 80s (1900-2024
| was 2.48% annualized) but using the average would make no
| sense.
|
| If you were still very rich in 1982 you would have made a
| massive amount of money since then. e.g. somebody like
| Trump invested all of his inherited wealth (and everything
| his dad gave him before) into the stock market instead of
| pretending that he was a very "successful" businessman he
| would have been much, much richer than he was in 2016 and
| wouldn't have had to be so ashamed about realising his tax
| returns.
| smallmancontrov wrote:
| > the growth rate of wealth itself
|
| The fundamental theorem of capitalism: rich people get paid
| for being rich in proportion to how rich they are.
|
| This is why your savings account looks like an exponential.
| The thing to understand is the difference in lived experience
| depending on where it starts. If you are poor, the returns
| are a joke, you tend to ignore them. If you are middle class,
| the returns fund your retirement, and it seems roughly fair:
| you work hard and at some point you earn the right to not
| work any more. Only if you are rich do you see the fountain
| of free money (homework: calculate yearly returns for the
| typical 10%er, 1%er, .1%er, and centabillionaire), and of
| course being the beneficiary you rationalize away the
| possibility that this could be a problem at all. It's a tidy
| system.
|
| "That's an unfair characterization of capitalism!"
|
| So is the one you get in economics which bends over backwards
| to hide the "fundamental theorem" as I have stated it inside
| a choice of units: "under conditions of market equilibrium
| every financial asset has an equivalent risk-adjusted rate of
| return from the perspective of its marginal buyer." Did you
| miss the class warfare? It was all hidden inside the word
| "rate." Very clever.
| LudwigNagasena wrote:
| How does economics bend over backwards to hide the
| "fundamental theorem"?
|
| Every intro to macroeconomics basically starts with a
| simplified conceptualisation of production as a function of
| labour and capital. Then it describes returns to labor and
| capital and so on. People who own capital get paid for that
| capital. It's quite literally Economics 101.
| danielmarkbruce wrote:
| Piketty is a hack. Most billionaires don't spend anything
| even close to their net worth. In effect, they have a bunch
| of IOUs from other people and never cash them in.
| imtringued wrote:
| So you're saying they have ever increasing influence and
| are keeping the rest of society in debt to them.
| danielmarkbruce wrote:
| "ever increasing" - no. People die, billionaires tend to
| stay that way for a few decades then die. In the grand
| scheme they are nothing, zero. Death aside, look at all
| the billionaires currently running to kiss the ring of
| Trump - a populist elected by the people of the US
| against the will of the so called elite. No one is in
| control, no one has very much power. It's a story book
| idea.
| pqtyw wrote:
| How exactly do your subsequent claims prove:
|
| > Piketty is a hack.
|
| Generally those IOUs are real as a ton of gold bars or
| dollar bills somebody might be hoarding in their vault.
| danielmarkbruce wrote:
| Inequality is generally accepted as differences in
| material possessions acquired/consumed or access to
| services (eg health, travel, whatever). It's fair to
| aggregate it into "consumption".
|
| Jeff Bezos is literally never cashing in the vast
| majority of the IOUs he has. The actual difference in his
| life isn't anything close to that suggested by the
| difference in net worth between he and I.
|
| Net worth differences aren't a good proxy for actual
| lived differences. It's off by orders of magnitude. This
| isn't a groundbreaking idea, Piketty is aware. He
| discusses it briefly in his book, with handwavy, abstract
| notions about "power" and "influence", as if that's what
| most people care about. But, it doesn't sell the same way
| his nonsense does. So he pedals his nonsense.
| pqtyw wrote:
| Perhaps. Then you can use something else instead of Gini.
| e.g. comparing wealth 10th, 50th, 90th, 99th percentiles.
| That would exclude Bezos & co.
|
| e.g.
|
| https://upload.wikimedia.org/wikipedia/commons/thumb/1/1e
| /19...
|
| I agree that this is probably a better metric. Easier to
| visualize and interpret than Gini.
|
| > his nonsense
|
| You could actually try making some coherent arguments
| before coming out with such conclusions?
| danielmarkbruce wrote:
| This is nonsensical. The response to "net worth is a bad
| proxy for consumption" isn't to show various ways of
| slicing and dicing net worth. A person with net worth
| $30m doesn't consume 10x that of someone with $3m, or
| anything like it. Piketty's own assumption is that most
| of the money is used for investment capital.
|
| The argument is clear - net worth is a bad proxy for
| consumption and lived experience. You just can't read.
| Piketty can, he just doesn't like that it makes his
| argument significantly less potent so he tries to paper
| over it with "power" and "influence" as if 99% of the
| world could care less about those things.
| pqtyw wrote:
| > net worth is a bad proxy for consumption and lived
| experience
|
| Because it's simply not. It's a very good proxy. I
| understand what you said and only think you are somewhat
| right if talking about people who are at the very tail of
| the distribution (yes, when it comes to "consumption and
| lived experience" it hardly matters if you have 100
| millions, 500 or even a billion).
|
| For those in the the 99.X% it's certainly (and obviously
| backed by all kinds of data) good indicator.
|
| Talking about the "lived" part. Here is another indicator
| http://www.equality-of-opportunity.org/health/. Of course
| now you'll claim that living for significantly longer
| does not say much about the "experience" part or some
| other nonsense.
|
| > You just can't read.
|
| Or have a low tolerance of ideologically driven
| demagoguery.
|
| >doesn't like that it makes his argument significantly
| less potent
|
| I'm still waiting for you to elaborate on that besides
| just claiming it as fact or "proving" that it doesn't
| apply if you're in the 0.1% (which is hardly relevant).
| danielmarkbruce wrote:
| The top 1% make ~800k pa. The bottom 1% make ~15k. Thats
| over 50x difference.
|
| The difference in life expectancy is 15%. That's 1.15x.
| And that's including that steepest part right at the
| front.
|
| You've been bamboozled by the y axis not starting at 0.
| Someone making 10x more than someone else gets a few %
| extra life expectancy. Significantly less than just
| taking a 30 min run a few times a week.
| pqtyw wrote:
| > The difference in life expectancy is 15%.
|
| Which is huge. Life expectancy in the US increased by
| ~15% between 1955 and now. Surely you would be entirely
| content with receiving the same level of care as was
| available back then and inhaling some lead now and then?
|
| > You've been bamboozled by the y axis not starting at 0
|
| It must be fun being so absurdly obtuse. The whole line
| of reasoning in your comment is so silly that it's hardly
| worth commenting on.
|
| There is a massive difference between dying before you
| reach 72 vs living for another 15 years.
|
| The difference in avg. life expectancy between Germany
| and Ethiopia is less than that.
|
| Again, surely there is no measurable difference between
| living in either place when you are making median income?
| danielmarkbruce wrote:
| The difference is less than those who exercise v not,
| slightly larger than that between men and women. For 50x
| chance in income. Money simply isn't as big a
| differentiator in life as you desperately want it to be.
| And that's the tiny bit of common sense required.
| adrianN wrote:
| Rich people generally don't keep the majority of their money
| as cash in a vault. When money lies in the bank, the bank
| invests it in the real world. Or more directly, when money
| lies in stocks and bonds, it is invested in the real world.
| mqus wrote:
| > when money lies in stocks and bonds, it is invested in
| the real world.
|
| Is it though? How much did Nvidia invest more, after their
| stock hikes? How about Tesla, Microsoft, Apple? No. They
| cut their staff or maybe stayed at their current investment
| levels.
| yorwba wrote:
| You have the ordering of events inverted. Companies do
| not automatically have more money to invest after their
| stock price rises, because the stock is traded between
| unrelated third parties. Rather, the stock price rises
| _after_ the company made investments that paid off,
| increasing the company 's expected future profit. This
| then retroactively provides the incentive for people to
| give money directly to companies to invest in exchange
| for partial ownership.
|
| So the question you should be asking is: How much did
| Nvidia invest before their stock hikes? And which
| companies will the original investors fund next after
| selling their shares at a profit?
| xivzgrev wrote:
| Small surprise: top marginal tax rates used to be 70-90% from
| the 40s to the 70s.
|
| https://taxpolicycenter.org/statistics/historical-highest-
| ma...
| SJC_Hacker wrote:
| There were so many deductions and ways of hiding things the
| effective rate was maybe 20%
| hcknwscommenter wrote:
| source?
| SJC_Hacker wrote:
| Tax revenue as a percentage of GDP historically has
| floated around 18%
|
| https://www.ceicdata.com/en/indicator/united-states/tax-
| reve...
|
| Here's the income percentage held by the top 1% 1950-2010
|
| http://piketty.pse.ens.fr/files/capital21c/en/Piketty2014
| Fig...
|
| While its true that its higher now than it was the
| 1950s-1980s, its an increase of about 15%.
|
| It if was the case that the very high marginal rates were
| actually being paid, you would expect the percentage of
| income held by the top 1% to be much higher.
|
| Here's another source with more direct comparison - how
| much their income they actually paid in tax
|
| https://taxfoundation.org/data/all/federal/taxes-on-the-
| rich...
| PopAlongKid wrote:
| Indirectly, we can point to the creation of Alternative
| Minimum Tax (AMT) in the 1960s to ensure that higher
| income taxpayers paid at least some minimum despite the
| plentiful deductions. Some of the things not allowed
| under AMT are state and local tax deductions, interest on
| mortgage equity debt (not acquistion debt), personal and
| dependent exemption deductions, deferring tax on
| compensation due to Incentive Stock Options (ISO), some
| kinds of accelerated depreciation, and so on.
| rayiner wrote:
| That's not a meaningful number because the taxable income
| was calculated differently:
| https://taxpolicycenter.org/taxvox/effective-income-tax-
| rate...
|
| The effective tax rate on the top 1% has been quite stable
| in the post war era.
| monocularvision wrote:
| The title of this piece is "Effective Income Tax Rates
| Have Fallen for The Top One Percent Since World War II"
| which seems to directly contradict your statement they
| have been stable?
| rayiner wrote:
| Right--they fell sharply from 1945 to 1955 (it looks the
| data points are sampled every 10 years) but have been
| pretty stable in the post-war era, as I said. Note that
| OP stated the top tax rate was lowered starting in the
| 1970s.
| monocularvision wrote:
| Got it. Thank you. I guess saying "they have been stable
| after 1955 would have made more sense time than "post-
| war" but maybe just being pedantic.
| TheSpiceIsLife wrote:
| Even though this comment is inaccurate because it just
| takes a a single figure figure and generalises it to all-
| of-time, I still feel compelled by to say something like:
|
| Giving money to politicians is like giving whiskey and car
| keys to teenage boys.
|
| The very to extremely wealthy run nations, why would giving
| them control of more money, someone else's money, be a
| reasonable idea.
|
| I suppose the argument is tax the rich more, and the poor
| less.
|
| Nah, there's got to be a better way, like maybe tax
| everyone less.
| ashoeafoot wrote:
| The period of true fear that communism could be a superior
| system .
| scotty79 wrote:
| > rich people want to invest some of it in the real world,
| not leave it in the bank
|
| Honestly, I have no idea why would anyone need that. Money is
| not value. Money is just a way of keeping track who is owed
| by future society how much value. It's a way of keeping tabs
| who gets to consume in the future.
|
| When rich people hoard their money it's not a problem, you
| can just print more money to replace what they sucked up and
| hoarded. It's exactly when they try to spend it where the
| problems start to show up. Because they are doing it stupidly
| causing at least some inflationary pressures but more often
| than not societal and environmental harm.
|
| Countries should make every effort to make spending their
| money as hard as possible for the rich people. Disincentivize
| them with high (and highly progressive) luxury, investment
| and real estate taxes. If that causes them to hide their
| money to avoid tax, even better. Every dollar of rich money
| hidden is a dollar of value not wasted by society on
| servicing the rich and their whims and gambling.
| SoftTalker wrote:
| People who make their money producing luxury goods or
| developing real-estate may disagree. As might all the
| people who work in the supply chains for those activities.
| ericjmorey wrote:
| Or just transfer their wealth to the rest of society. What
| they think is theirs is only true if the rest of us agree.
| pb7 wrote:
| Please go build your communist utopia elsewhere.
| MichaelDickens wrote:
| Economists mostly disagree with Piketty's thesis:
| https://www.kentclarkcenter.org/surveys/piketty-on-
| inequalit...
| Aromasin wrote:
| Of course they do. They've built entire careers around the
| concept that the whole economy can be models on N=1.
| Inequality doesn't fit into their models, so they dismiss
| it out of hand because otherwise the 20+ years of their
| life they've spent devoting to their craft proves to be no
| more useful than a horoscope.
| lazzlazzlazz wrote:
| Inequality is very simply to include in these models, and
| they do. The problem is that the models often show that
| the median quality of life improves faster when there's
| somewhat more inequality in the system, which flies in
| the face of every socialist intuition. It's a lot easier
| to pretend we need state-enforced equality.
| kevinventullo wrote:
| Do their models show that the median quality of life in
| the US has increased in the last 20 years? Honest
| question.
| smallmancontrov wrote:
| It's simple to include, but there's no denying that the
| 101-level economics models steer you away from thinking
| about inequality harder than Vin Diesel in a car chase.
|
| Carefully omitting the fact that the economic notion of
| value is wealth-weighted (and you can march enough
| elephants through this loophole to wage a class war),
| drawing attention away from "rich people getting paid for
| being rich" dynamics by dividing out wealth wherever
| possible, inviting you to use averages where "rich get
| richer" hides "poor get poorer" -- it's a masterclass in
| propaganda. I have literally never in my life seen a more
| artful tapestry of deception than Econ 101.
| thfuran wrote:
| 101-level models in every field elide important details.
| That's pretty much their whole point. And it doesn't make
| them propaganda, it makes them a perfunctory
| introduction.
| smallmancontrov wrote:
| No, you don't omit the leading term by accident. Not five
| times in a row from three different angles.
|
| In any case, this is also matter of historical record:
| the purge of left-wing thought from economics and
| politics at the end of the New Deal Era was loud and
| vicious. It didn't stop at ensuring capitalist principles
| got top billing, it scorched the earth until even the
| most earnest self-examination of capitalism's largest
| weakness was cause for cancellation. You bury it, or you
| wear the scarlet letter. Most chose to bury it, and here
| we are.
| theGnuMe wrote:
| This is an awesome take.
| roughly wrote:
| I cannot think of another subject whose "101" level
| magical thinking has affected the real world as much as
| economics, though. At some point the purpose of a system
| is what it does, and economics 101 affects the political
| discourse in a way I struggle to find adequate
| comparisons for.
| hn_throwaway_99 wrote:
| Inequality exists on a spectrum and there is something in
| between Gini coefficients of zero and one.
|
| If anything, I think economists have grossly
| underestimated how large increasing levels of inequality
| have had such a corrosive effect on our social cohesion
| and political systems, and that obviously does have a
| huge impact on eventual economic outcomes. This
| societal/political breakdown is not something that
| economists usually model well.
| theGnuMe wrote:
| Is the MAGA movement really about the economy? I'm trying
| to understand it.
| Spivak wrote:
| I don't know if anyone is really arguing for state
| enforced equality. Just that in a capitalist system money
| naturally accumulates at the top and slowly regresses
| into a socialist like centrally planned economy as fewer
| and fewer people have meaningful wealth to allocate. A
| little inequality is good because there's a reward
| mechanism for allocating resources better but a lot of
| inequality locks up the economy. And the only thing to
| really do is tax it and recirculate it back to the
| bottom.
| theGnuMe wrote:
| 2045 - the America dividend!
| pmarreck wrote:
| Are you saying that economists aren't interested in
| sustainable economies?
|
| IANAE, but this sounds about as implausible as claiming
| that developers aren't interested in building sustainable
| codebases
| gentleman11 wrote:
| Depends on the developer and on their organization they
| work for. Ideally, most do, but the pressures of work and
| the styles of project management sometimes sideline that,
| or the team ends up in survival mode where they merely
| try to stave off the inevitable spaghetti apocalypse
| theGnuMe wrote:
| "Not invented here." syndrome
| Der_Einzige wrote:
| Just for the record, no one in AI (the space where
| increasingly all of code is moving to) cares about
| building "sustainable codebases".
|
| Worst code quality: AI devs
|
| Best code quality: Game devs
| harimau777 wrote:
| The VAST majority of developers I've encountered aren't
| interested in building sustainable codebases. Mainly
| that's because that's not what their bosses want so it's
| in their best interest not to care about it. I could see
| the same happening if the economist's bosses don't care
| about sustainable economies.
| hello_moto wrote:
| Economists, the one with Master and PhD, built their
| understanding and thesis from those fundamental models
| where inequality was not in the picture (to simplify the
| model).
|
| To agree with the opposite views mean to disprove their
| thesis and career.
| julianeon wrote:
| We should be careful when we say "economists disagree."
|
| Economists disagree with Piketty about the causes of this
| inequality: that is true.
|
| Economists agree with Piketty however about the extent of
| inequality, by and large. That is, no one is arguing
| "inequality isn't real" or even "inequality is decreasing."
|
| So there is disagreement about what's causing the
| inequality, yes. But on what (to me) is the bigger question
| - is inequality real and increasing? - there is a consensus
| that it is.
|
| It's all there in the historical record, and as a trend,
| it's huge.
| bloppe wrote:
| Inequality can increase while the poorest are still
| getting richer in real terms (inflation-adjusted income).
| That's been the case for a decades now:
| https://archive.is/HcRsU
|
| "It is the mechanic and teaching assistant in the middle
| who have the best claim to having missed the party:
| median real income rose by 57% from 1990 to 2019. But
| that is still a healthy 1.6% per year--a far cry from the
| stagnation in median earnings that is sometimes alleged".
|
| For the record, I think inheritance tax should be way
| higher, and allowing the value of money to outstrip the
| value of labor is a travesty, but it's important to keep
| in mind that people across the income spectrum are
| getting richer in real terms. It's better to be poor in
| America than median income in most countries.
| Erikun wrote:
| Is 1.6% a healthy median rise in income? According to
| Statista the inflation rate has been equal or more than
| that with the exception of four years during that time
| frame.
| https://www.statista.com/statistics/191077/inflation-
| rate-in...
| timerol wrote:
| It's already adjusted for inflation, like most economic
| statistics posted by non-cranks. "Real" means inflation
| adjusted, "nominal" means not adjusted
| opo wrote:
| >According to Statista the inflation rate has been equal
| or more than that with the exception of four years during
| that time frame.
|
| The 57% growth is after inflation:
|
| >>...median real income rose by 57% from 1990 to 2019.
|
| ('real' income means after inflation, 'nominal' income
| means before inflation.)
| BurningFrog wrote:
| An annual rise of 1.6% means income doubles ever 44
| years.
|
| Again: These number are already adjusted for inflation.
| pqtyw wrote:
| > poorest are still getting richer in real terms
|
| Perhaps. So what? Their wealth/incomes were increasing
| much slower than worker productivity. Technological
| progress compensates for the massively increasing
| inequality to some extent.
|
| Also other figures show that median and bottom 10th
| percentile incomes were almost completely stagnant
| between 1967 and 2014.
|
| https://www.census.gov/library/visualizations/2015/demo/r
| eal...
|
| Of course real median income increased massively
| (compared to previous decades) in the last 10 years but
| it's not clear yet how sustainable is that
| saltcured wrote:
| "...allowing the value of money to outstrip the value of
| labor is a travesty..."
|
| I am NOT an economist, and wonder what you mean here? It
| feels contradictory to me, given a system that makes
| labor fungible with money.
|
| I've armchair puzzled over this aspect of capitalism and
| human nature. It seems to me that we, as individuals in
| this system, most fundamentally want to be able to use
| capital to time-shift the fruits of our labor, i.e. for
| rainy days, retirement, and unforeseen events. We need to
| be able to convert labor to capital, hold it, then
| convert it back to gain benefits of someone else's labor
| later.
|
| But it seems inherent that this ability to make labor and
| capital fungible will enable some to amass and wield much
| more capital than others. In a population with differing
| wages, lifestyles, life events, and appetites for risk,
| it seems inevitable that the integral of these net
| savings effects will be divergent.
|
| If you introduce a "reset" or leveling function, it seems
| like it will contradict this stored labor feature. It
| pushes us back on the continuum towards living hand-to-
| mouth, since our stored efforts are diminished in the
| future. And, I think human nature is such that we will
| "optimize" to stop trying to store effort that we can't
| expect to get back...
|
| Is this an inherent feature of economics (or of society)?
| Do we need a fiction of security and potential future
| wealth to motivate our contributions, yet eventually need
| discontinuity to terminate the outcomes of this fiction?
| jrussino wrote:
| > We need to be able to convert labor to capital, hold
| it, then convert it back to gain benefits of someone
| else's labor later.
|
| That part seems fine to me. The thing that feels
| intuitively "wrong" is that it's possible to amass
| money/capital way out of proportion to the amount of
| labor input.
|
| The example of the "four hour work week" concept comes to
| mind, where the goal is explicitly to minimize the ratio
| of input labor to output capital. Why should 4 hours of
| my work now entitle me to, say, 40 (or 400, or 4000...)
| hours of someone else's work later?
|
| I am also not an economist, so perhaps someone else can
| explain what other mechanism is working alongside your
| "labor is fungible with capital" that leads to this
| result, and whether it's a feature or a buy of the
| economic machine...
| jrussino wrote:
| To partly answer my own question - clearly there is work
| we can do that is net-positive. I can spend my time
| turning a crank to charge a battery, and sometime later
| get back a subset of the energy I put in. Or, I can spend
| that amount of time digging up coal, or building a solar
| panel, and then sometime later have access to many
| multiples of the amount of energy that I put in.
| dragonwriter wrote:
| > How can people not see that Trump is weakening USA?
|
| Yes, but once income inceeases beyond starvation levels,
| relative deprivation predicts misery more than absolute
| deprivation, so in a relatively developed country, that's
| still a bad thing.
| harimau777 wrote:
| How does that work with so many people being worse off?
| I.e. most of my friends can't afford a home, avoid going
| to the doctor, can barely make ends meet in dead end
| jobs, etc. Maybe, the measurements they are using for
| inflation aren't measuring the right things?
| AnimalMuppet wrote:
| OK, but Piketty's thesis _is_ about the cause of
| inequality, not just that it exists and is growing. So,
| economists agree that inequality is growing, and disagree
| with Piketty 's thesis.
| insane_dreamer wrote:
| _Some_ economists disagree. That's partly because
| inequality doesn't fit into their models. Gary Stevenson
| explains this quite well[0]
|
| [0] https://www.youtube.com/watch?v=CivlU8hJVwc
|
| Also, what those polled disagree with is this particular
| statement:
|
| > The most powerful force pushing towards greater wealth
| inequality in the US since the 1970s is the gap between the
| after-tax return on capital and the economic growth rate.
|
| This doesn't mean they disagree that r>g is a contributing
| factor to a greater portion of wealth being transferred to
| those with investment capital (which ultimately can have
| dire consequences for society). It's not difficult to
| demonstrate that those with a higher rate of return than
| the pace at which new wealth is being created (one
| definition of economic growth) will be capturing a greater
| share of that new wealth.
| kristofferg wrote:
| (1) "American economists" only. (2)Also I am sure looking
| at the political/institutional affiliations of the
| responders would be interesting. (3) The responders
| comments show very different reasoning for disagreement.
| Some focus on stat derivatives, some on model
| incompatibility and some on more anecdotal evidence. (4)
| Some answers are bat-shit crazy like "not sure wealth
| inequality has risen in the US".
| dreghgh wrote:
| > Basically he compares two kinds of growth rates : the
| growth rate of the 'real' economy and the growth rate of
| wealth itself. You need the wealth rate to be low enough that
| rich people want to invest some of it in the real world, not
| leave it in the bank.
|
| I think your second sentence, and thus your explanation of
| Piketty's thesis, is wrong. Piketty's point was that if
| wealth grows faster than the economy, the total share of all
| assets held by the wealthy will grow and grow. I don't think
| he was concerned about the choice to invest 'in the real
| world'. In any case it's not clear what 'not investing in the
| real world' means or if it's meaningful. Any return on
| capital either comes from direct investment or from lending
| to someone else who will invest directly. There is a
| fundamental accounting equation which proves that all net
| saving is net investment.
| AlexandrB wrote:
| > Any return on capital either comes from direct investment
| or from lending to someone else who will invest directly.
|
| Is this true? I'm not saying it's a huge portion of all
| saving, but holding wealth in things like precious metals
| or greater fool investments like Bitcoin doesn't seem like
| "investing" in anything productive.
| eftychis wrote:
| If you bury gold bars that you mined yourself in your
| backyard, or you bury your salary in cash there straight
| from your paycheck, then you remove money from the system
| and thus not invest it. And effectively damage the
| economy, mainly via lack of liquidity.
|
| It's hard making your capital inaccessible to the
| economy, but it's easy to not get the benefits of that
| working capital.
|
| For instance, any time you park your money in a regular
| bank account or lend it at a suboptimal rate, you don't
| get some of the benefits.
| TheSpiceIsLife wrote:
| This comment was down voted, but is a reasonable
| response.
|
| Further to the parent comment, if you park your money in
| gold or crypto, you've given that money to someone else,
| and so on and so forth.
|
| But there's a balance to be bad, if no one actually
| spends anything other than acquiring investments, they
| starve, and the economy suffers.
| hgomersall wrote:
| No it isn't true. Holding money as money in a bank
| account is also not investing unless you think that
| providing liquidity to a bank is a useful investment
| (liquidity they can trivially access from the central
| bank, albeit at a slightly less desirable rate). A bank
| deposit is a liability to the bank, not something that
| can be invested.
| WalterBright wrote:
| > the actual real value of the world remaining the same
|
| If I take raw materials, and create something with them, I
| have increased the real value of the world.
| ok_dad wrote:
| Those 2025 new years glasses are going to be so valuable.
| lo_zamoyski wrote:
| > invest some of it in the real world, not leave it in the
| bank.
|
| The richer you get, the more likely you are to engage in
| wealth management. This necessarily means investment. No one
| who's rich has that much liquidity or money just laying
| around. This is as stupid as hiding cash in your mattress.
|
| The question is which are genuine investments or scams. And
| this _cannot_ be emphasized enough: either money is made from
| value-generating labor, or you are in the business of theft.
| There is no middle ground or third option.
|
| This is why I think _one_ key element of restoring sanity to
| economies is the _categorical_ criminalization of usury.
| Compound interest is theft, and it boggles the mind how
| easily people are intimidated into going along with the
| rationalizations purporting to explain that it is not (all
| that nonsense about opportunity cost, as if that is the
| borrower 's problem or responsibility). Banks are important,
| but they are not productive per se. The only ways a bank can
| legitimately make money is through service fees and
| investments (and real investments, where there is a kind of
| partnership and proportionate skin in the game, not magic
| bailout money or some kind of weird accounting magic).
|
| Once we destroy the superstitious idea that money can be
| bred, stop using euphemisms for theft, and acknowledge labor
| as the basis of all economic value, we will see a healthy
| economic shift and more distributive justice. Housing markets
| will improve, too. The change is deep cutting.
|
| The whole discussion about inequality or taxing the rich or
| inheritance is confused and frankly a distraction from real
| problems, and I suspect at times a purposeful distraction,
| because it preserves perverse economic norms (making the tax
| simply the cost of doing business) instead of correcting
| them, which is the real threat.
| ninetyninenine wrote:
| Gary is great laying it out for the layman but he talks as if
| he "thought" it all up. It's really Thomas Piketty who
| pointed out the issue way before Gary.
| keybored wrote:
| I don't understand why you need rich people in the first
| place. You don't need human beings that hoard wealth that
| they didn't make. It's superfluous.
| bigstrat2003 wrote:
| You don't "need" rich people, but they are an inevitable
| consequence of the ideas Western civilization is built on.
| We generally believe that someone is entitled to keep what
| they have earned and do what they wish with it (property
| rights). So, let's say you burn down society and start over
| with everyone working at subsistence level. The first
| generation, everyone will be basically equal. By the end of
| the generation, some will have done better than others
| (through luck, or through hard work and intelligence). They
| will want to pass it on to their children. Now in the next
| generation, some people will be starting at an advantage.
| Some of those will take it easy, but some will use their
| leg up to get even further ahead. The ones who get even
| further ahead will want to pass that on to _their_
| children, and so on.
|
| Repeat this cycle enough times and you will wind up with
| rich people and poor people, even if you started with a
| perfectly level playing field. It's an inescapable outcome.
| Some people will always do better than others, even
| starting from nothing, and as that advantage accretes
| through generations it will mean you wind up with the haves
| and have-nots. The only way to prevent it is to enforce
| limits on what people can do with the fruits of their labor
| - and that is something most are not willing to do. People
| believe in property rights and aren't generally willing to
| violate them. So, you will inevitably have rich people in
| society.
| mrjin wrote:
| Nothing lasts forever. The rich get most of the economic growth
| is inevitable. It's the Matthew effect. In general, the more
| assets you have, the more passive income you have, which in
| turn frees people up from worries about making breads for the
| family, and thus can spend more time on think and do things
| more important in the long run. Again, that would reinforce
| their financial status. In the meantime, the poor would have to
| worry about next meal, and mostly don't have the reserve for
| investments. Thus, they will most likely struggle to save
| something, and even if they do manage to save some, an
| unexpected event can easily wipe it out before it reaches the
| threshold.
|
| If the riches were conscious enough, they would return a fair
| share to the poor and the eventual crash will be deferred much
| longer. But you know, everyone wants more money, no exception
| for the riches. It looks the only thing we learn from the
| history is that we learn nothing from history. So here we are:
| the same drama of empires' rise and fall, the only differences
| are the locations and the actors.
| thrance wrote:
| Yes, historically the rich lose their heads when they forget
| that their taxes are used to buy social peace...
| abeppu wrote:
| > we are headed for a destroyed Europe and a civil war in the
| US
|
| "Capital in the 21st Century" by Piketty does a good job
| arguing that the historical normal condition is for wealth to
| concentrate bc the returns on capital are greater than overall
| economic growth. It's depressing, but creating the kind of
| world that a lot of us and our parents enjoyed takes special
| conditions (and political will?) ... but the flip side of this
| view is that intense inequality can endure for long periods of
| time and doesn't necessarily lead to political instability.
| lr4444lr wrote:
| A Civil War in the USA? Where would the battle lines even be
| drawn? There is no consensus, and there are hardly even blue or
| red states anymore beyond 60/40 splits. Even racially we are
| seeing a lot less polarization.
| chasd00 wrote:
| I live in Texas and back when the idea of succession was
| being thrown around I asked my friends if they'd go toe to
| toe with the US Marines while bombers and drones loitered
| above their heads. They got very quiet.
|
| I don't think a civil war in the us is possible but I think
| advertisers taking advantage of the divisiveness to see chaos
| is likely (and already happening).
|
| Edit: I meant "adversaries" instead of "advertisers" but I
| think advertisers works equally well so left it in.
| chaostheory wrote:
| If it were to happen, it would also be very skewed towards
| one side, since only the right believes in arming themselves.
| alexilliamson wrote:
| Most likely is that the side with the army and guns turns
| the blue areas into an occupied police state, and sells it
| to the constituency as a "civil war", despite it being
| completely one-sided.
| imgabe wrote:
| By definition, the poor don't have money. How are you
| transferring wealth away from people who don't have any?
| calmworm wrote:
| Is this a serious reply? The poor may not have much, but
| every dime they do have is spent on necessities... rent,
| food, healthcare. So where does that money go? Who are the
| actual recipients of those dimes?
| imgabe wrote:
| Are you defining the rich as "every single person who sells
| any good or service"?
|
| Where did the poor get their dimes in the first place?
| calmworm wrote:
| I didn't attempt to define the rich.
|
| Are you attempting to make a "they provide jobs"
| argument? Because they wouldn't if they didn't have to.
| Jobs are an unwanted byproduct of a successful business.
| imgabe wrote:
| Seems like you should just start a successful business
| then. The business owner provides no value and just gets
| tons of money for free. Sounds like an amazing deal. Why
| don't you take it?
| kubb wrote:
| I think you would agree that success often depends on
| access to resources and support system - not everyone
| starts at the same point. Many who are celebrated as
| self-made often benefit from inherited advantages, which
| complicates the meritocracy narrative.
| imgabe wrote:
| Lots of people have access to resources. Very few of them
| start successful businesses. Zuckerberg's parents were
| dentists. They were well off, sure, but there are
| hundreds of thousands of dentists in the US, if not
| millions. Why don't all of their kids start companies
| like Facebook?
| kubb wrote:
| There aren't _millions_ of dentists :)
|
| I think you know at least some of the reasons Gabe. There
| is a series of filters: intelligence, early skill
| development, a supportive environment, elite networking,
| risk tolerance, strong vision, perfect market timing, and
| a business model benefiting from network effects in a
| market that can only sustain a few winners.
|
| This list might be incomplete. Would you like to
| supplement it, or do you prefer to continue with the
| socratic method? I'd like if you did the former, because
| the latter comes across as arrogant and condescending.
| imgabe wrote:
| I said hundreds of thousands, if not millions. It turns
| out there are around 200,00.
|
| Success depends on some combination of hard work / talent
| / luck. You can have an extreme amount of all three and
| get an extreme outcome like being a billionaire, you can
| have moderate amounts of 2 / 3 and still be quite well
| off. You can have extreme amounts of one and be
| successful from very little.
|
| Access to resources helps, obviously, but it is neither
| necessary nor sufficient.
| jltsiren wrote:
| I don't think it's that simple.
|
| Things that can be produced with machines rather than labor
| have become more affordable over time. Electronics, travel,
| clothes, and even food are cheaper than they used to be
| relative to wages. Then there are fields like education,
| childcare, and construction, which have not seen substantial
| productivity gains. The prices of their outputs can be expected
| to rise at the same rate as wages. (And then there is
| healthcare, which is complicated.)
|
| But what has actually happened that increased housing costs
| have eaten the productivity gains for many people. Largely
| because of deliberate policy. Desirable areas often discourage
| new construction. When new construction is allowed, they
| prioritize single-family homes. And if really pressed, rental
| complexes.
|
| As a rule of thumb, if you can afford to rent, you can afford
| to buy. If you expect to stay longer than a couple of years,
| you should buy. But in many places, if you can't afford a large
| home, you have to rent a small apartment. Because there is a
| shortage of small condos to buy. If the units available for
| purchase grow larger while the price per square foot grows at
| the same rate as wages, housing becomes less affordable.
| mjevans wrote:
| In many of the denser population areas of the US
| _generations_ 30, 50, maybe more YEARS worth of insufficient
| building has left a completely broken situation of stagnation
| relative to population.
| cscurmudgeon wrote:
| The same Gary Stevenson whose memoir claims Financial Times
| debunked?
|
| https://archive.is/DguLm
| cmcaleer wrote:
| His whole narrative he crafted was really unbelievable. I
| watched a video of him explaining his story, expecting to
| hear some story of finding consistent signals that stayed
| alive for a long time or finding crafty wording in bond
| contracts, but the whole story was that he took a punt on the
| GFC being worse than the market expected, and he made low 8
| figures. And somehow, because of this, by some measure, he
| was the best trader in the world.
|
| I too was the best trader in the world when I got some
| skittles from my friend in the playground for free and sold
| them to another kid for a dollar making an infinity percent
| profit, but I didn't feel the need to make a YouTube career
| out of it.
| blitzar wrote:
| Grifters gunna grift. He is just another lippy barrow boy
| that claims to be the "best trader in the world" - actually
| surprisingly common in London bank dealing rooms.
|
| The oddity is that it has taken so long for them to find
| YouTube.
| wnolens wrote:
| I too was intrigued to find him but it took 10mins of
| watching a few videos to be left feeling duped.
|
| Felt like he's working out his problems on YouTube rather
| than therapy (after first trying to in a trading career). I
| really dislike his (and most progressive's) narrative that
| others are distinctly out to get you. It shrouds the real
| complex machinery, and papers it over with intent. Which
| impedes meaningful progress i think.
| evidencetamper wrote:
| He has found something of an audience in the social media
| oriented audiences, who are educated enough to grasp the
| general idea, but not specialized enough to verify his
| claims.
|
| I've only heard of him because of this sort of Hacker News
| comments, and my general impression is that he is usually so
| off the mark that it is hard to have relevant conversations.
|
| He makes money selling books and having an Youtube channel.
| wnolens wrote:
| Right, he's just moved from taking people's money to
| stealing their attention. Grifter til the end.
| _factor wrote:
| I think we're seeing his spilt economic system coming into play
| with computer hardware. Less and less B2C sales over time. It's
| just not as profitable to sell to poor people.
| UltraSane wrote:
| In 1995 my parents, both factory workers, bought me a $2500
| Packard Bell PC with 100MHz Pentium, 8MB of RAM, and a 1GB
| hard drive. Adjusted for inflation that would be a $5,283.95
| computer today.
| chasd00 wrote:
| I remember that exact model. Computers use to be very
| expensive. You can pick up a brand new powerful laptop to
| build a career on for $300 at Target. (I'm in the US I know
| many commenters here are not)
| sdsd wrote:
| Before the election, everyone on HN was telling me that we live
| in the best economy ever and we're in a "vibes recession" where
| ignorant Americans can't understand how impossibly good things
| are. Now that it's less politically salient, everyone can just
| say true things. I wish every subject were like this all the
| time.
| heresie-dabord wrote:
| > the entire system is corrupt
|
| The universal dismay of humanity is that we _actually built and
| held onto_ Democracy for a time.
|
| Not perfectly, but better than suffering any dictatorship by
| "royalty" and oligarchs.
|
| The transnational petroleum business was never going to go
| quietly into energy decline. Its component interests are
| flexing their influence.
| jgalt212 wrote:
| > The truth is economic growth hasn't been occurring in real
| terms for most people for a long time and the rich have been
| transferring money from the poor to themselves at a dramatic
| rate.
|
| It blows my mind why pension funds continue to invest any money
| at all in PE and Hedge Funds. It's a straight up wealth
| transfer from the working class to the investor class. States
| should pass max fee laws for their own pension fund
| allocations.
| rayrey wrote:
| Darn pensioners are living too long driving the search for
| alpha
| westurner wrote:
| From https://news.ycombinator.com/item?id=43140675 :
|
| > _Gini Index:https://en.wikipedia.org/wiki/Gini_coefficient _
|
| Find 1980 on this chart of wealth inequality in the US:
|
| > _GINI Index for the United
| States:https://fred.stlouisfed.org/series/SIPOVGINIUSA _
|
| Are there additional measures of wealth inequality?
| westurner wrote:
| Income distribution:
| https://en.wikipedia.org/wiki/Income_distribution
|
| World Inequality Database:
| https://en.wikipedia.org/wiki/World_Inequality_Database
|
| USA!: https://wid.world/country/usa/
|
| Economic inequality:
| https://en.wikipedia.org/wiki/Economic_inequality :
|
| > _Economic inequality is an umbrella term for a) income
| inequality or distribution of income (how the total sum of
| money paid to people is distributed among them), b) wealth
| inequality or distribution of wealth (how the total sum of
| wealth owned by people is distributed among the owners), and
| c) consumption inequality (how the total sum of money spent
| by people is distributed among the spenders)._
| gchamonlive wrote:
| We need a way to both have the benefits of modern social
| organization without supressing the means to fall back to
| simpler but more resilient and decentralised societies which
| would come together to maintain the form of nations in times of
| crisis, which inevitably come again and again.
|
| What we have is a social crisis that billionaire class used to
| exploit the nation for classist gains, with the collateral
| effect of damaging the nations memory, identity and values.
| wslh wrote:
| While we cannot predict the future, I found the movie Civil War
| (2024) really great and original.
| onlyrealcuzzo wrote:
| > the rich have been transferring money from the poor to
| themselves at a dramatic rate.
|
| By definition, the poor have almost no money to transfer.
|
| Wouldn't you have to transfer from the middle class - which is
| shrinking in relative terms?
|
| The poor have never had anything and still largely have
| nothing. It is literally in the definition.
|
| I don't see how it's possible to enrich yourself (when the
| amount you need to grow by even small percentages is enormous)
| from a class with nothing to take.
| atomicnumber3 wrote:
| The poor have no money individually, but in aggregate they
| have _some_. $1 from a million poor people makes one
| millionaire.
|
| IMO the main thing they extract from the working poor is time
| - what they're stealing is the excess value between their
| labor and the value is creates, and technology has made it
| easy to do this at a massive scale. So it's less $1 from each
| person, it's 8 hours per day from a million people makes 1
| person a billionaire.
| onlyrealcuzzo wrote:
| You don't get $400B by stealing pennies from poor people.
|
| For one, there aren't 100m poor people in the US. Not even
| close.
| Supermancho wrote:
| Somewhere around 45m in poverty in the US (2023), already
| counting around 1m homeless.
| mtrovo wrote:
| What about family-owned property? Lots of poor people live in
| multigenerational homes that might be the last step before
| not owning anything. Also, the fact that the housing market
| is this bad just means a large portion of the population will
| be stuck in rental accommodation for the foreseeable future,
| and that should be accounted for as a form of money transfer
| somehow.
|
| And for those who will say, "Then the government should just
| build more houses", let me point out that we might run out of
| space before the appetite for real estate investment dies
| out.
| onlyrealcuzzo wrote:
| By definition, you're not poor if you own a
| multigenerational million dollar house in Los Angeles.
|
| The people who are ACTUALLY poor, don't have such things.
| discodonkey wrote:
| >economic growth hasn't been occurring in real terms for most
| people for a long time
|
| This is just not true.
|
| At least in the U.S., people of all income tiers have seen
| their incomes grow[0] while their working hours shrunk[1].
|
| Inequality is a problem in itself, but equating unequal gains
| with "transferring money from the poor" seems like bad faith.
|
| [0] - https://www.pewresearch.org/race-and-
| ethnicity/2024/05/31/th...
|
| [1] - https://ourworldindata.org/grapher/annual-working-hours-
| per-...
| dleeftink wrote:
| Two things can be true at once; growing income per working
| hour has not resulted in less income inequality.[0]
|
| [0]: https://ourworldindata.org/explorers/inequality?tab=char
| t&Da...
| discodonkey wrote:
| True. Income inequality increased.
|
| The person I responded to suggested that only the rich saw
| income growth, and that they were achieving this by taking
| from the poor, which is wrong.
| PaulDavisThe1st wrote:
| This was true until quite recently (within the last 5-6
| years).
|
| Income growth in real dollars had been stagnant since the
| late 1970s for most deciles.
| renewiltord wrote:
| There's no recipe for happiness that primarily involves
| looking in the other guy's bowl. Even if you have
| everything to eat, you will still need unhappy if he has
| more.
|
| No wonder you guys constantly post about unhappiness. You
| are obsessed with keeping up with the Joneses.
|
| Much more joy if you instead care only about absolute
| living standards. My life has improved a lot and if Jeff
| Bezos appears before me and will make me 10x as wealthy if
| he is 100x I will gladly choose that.
|
| We live as long as kings, with greater variety of food and
| drink, greater variety of entertainment, and big
| comfortable houses. I'd take this trade 10/10 times.
| PaulDavisThe1st wrote:
| Given that I worked with Jeff Bezos at the beginning of
| amzn, and made roughly $1M before I was 33 as a result,
| I'm hardly in the "obsessed about keeping up with the
| Joneses" group: I _was_ the Joneses.
|
| That doesn't stop me from saying that the distribution of
| wealth within the US economy is immoral, and detrimental
| to our politics, our health, our environment and more.
| And it doesn't stop other people from saying so either:
|
| https://www.responsiblewealth.org/
|
| Those folks are hardly obsessed with keeping up with
| anyone.
|
| I'm glad that your life has "improved a lot". But that's
| not a reason to give up on fairness, decency and even
| just plain old self-interest. It's a better society for
| everyone if there's less inequality, even those at the
| top.
| Apocryphon wrote:
| > We live as long as kings, with greater variety of food
| and drink, greater variety of entertainment, and big
| comfortable houses.
|
| https://www.aei.org/carpe-diem/chart-of-the-day-or-
| century-8...
|
| > During the most recent 22.5-year period from January
| 2000 to June 2022, the CPI for All Items increased by
| 74.4% and the chart displays the relative price increases
| over that time period for 14 selected consumer goods and
| services, and for average hourly wages. Seven of those
| goods and services have increased more than the average
| inflation rate of 74.4%, led by huge increases in
| hospital services (+220%), college tuition (+178%), and
| college textbooks (+162%), followed by increases in
| medical care services (+130%), child care (+115%), food
| and beverages (82%) and housing (80%). Average hourly
| earnings have also increased more than average inflation
| since January 2000 -- by nearly 100% -- indicating that
| hourly wages have increased 25% more over the last two
| decades that the average increase in consumer prices.
|
| > The other seven price series have been flat or have
| declined since January 2000, led by TVs (-97%), toys
| (-72%), computer software (-70.5%), and cell phone
| service (-41%). The CPI series for new cars, household
| furnishings (furniture, appliances, window coverings,
| lamps, dishes, etc.), and clothing have remained
| relatively flat for the last 22 years while average
| consumer prices increased by 74.4% and wages by 99.6%,
| although all three series (TVs, toys, and software) have
| WarOnPrivacy wrote:
| > Even if you have everything to eat, you will still need
| unhappy if he has more.
|
| Yes if the demands on our personal resources (inc hours,
| energy, cognition) far outstrip our quality of life
| gains.
|
| Me (gen x) vs my parents (silent gen): Parenting time
| went from a few hours per week to 24/7 adulting while
| kids growth resources (free range+adult free) was nearly
| eradicated.
|
| My parents had tons of leisure time. I had none.
|
| Mundane activities are unimaginably complicated now -
| needs that once had a couple of factors to consider now
| has dozens of compounding factors, each with their own
| subgroups to work through.
|
| Consumer choices are flooded with bad options; long
| research is needed to avoid the never-ending line of
| traps.
|
| > We live as long as kings, with greater variety of food
| and drink, greater variety of entertainment, and big
| comfortable houses.
|
| What's left out of the "Live Better Than Kings" spiel is
| that gains turn into mandates (electricity, internet).
| They're required to meet basic needs like housing and not
| having kids taken away.
|
| > I'd take this trade 10/10 times.
|
| Draw up the entire list of factors that a poor American
| has to work through. Drop a king into that life for a
| month and have them report back.
| keybored wrote:
| > There's no recipe for happiness that primarily involves
| looking in the other guy's bowl. Even if you have
| everything to eat, you will still need unhappy if he has
| more.
|
| What kind of happiness demands billions of dollars? These
| things go both ways.
|
| > No wonder you guys constantly post about unhappiness.
| You are obsessed with keeping up with the Joneses.
|
| As opposed to the ultrarich who have actively pursued
| this inequality? Curious, it consistently only goes one
| way in your mind.
|
| > Much more joy if you instead care only about absolute
| living standards. My life has improved a lot and if Jeff
| Bezos appears before me and will make me 10x as wealthy
| if he is 100x I will gladly choose that.
|
| Who said that Bezos could do that? Who said that wealth
| is created by the ultrarich? No one, but your mind seems
| to think so for some reason. Well, I'm sure you could
| find supposed evidence of it on X and the _Washington
| Post_ , for whatever reason that might be.
|
| > We live as long as kings, with greater variety of food
| and drink, greater variety of entertainment, and big
| comfortable houses. I'd take this trade 10/10 times.
|
| So? This is a forum visited by high-earning US software
| engineers (that's not me but a lot are). Not the kinds of
| people that the last four decades have hurt (the most).
| Which is why you get these surprise comments in these
| threads. "Woah guys, I've been reading these numbers
| lately and people are actually poor out there."
|
| No, I don't think that it's the Microsoft staff engineers
| that are personally mad about the state of things.
| dleeftink wrote:
| Quite the opposite, I've never yearned for more or even
| had a stable income. Yet I'm very happy.
|
| Flat out concluding that everyone can make their own
| happiness by just being open to a system that constrains
| many others along the way, feels like regressing not
| progressing.
| oblio wrote:
| 1. What are the growth rates per quartile?
|
| 2. How have living expenses grown?
| PaulRobinson wrote:
| Consider how big the difference is between each segment
| identified here. Realise that the upper income bracket itself
| could be broken down into three segments that would show an
| ever starker difference.
|
| Unequal gains is _the problem_ , and your intuition can help
| inform why: the 2023 dollar index used is based on what rate
| of inflation? CPI? RPI? Something else? Why is it that in
| 1970 a median income household could buy a home on a single
| income and raise a family (including sending kids to
| college), on a 2023-dollar income of $66k, but that's mostly
| not possible on $106k in actual 2023 for most households.
|
| When you adjust for real buying power using a less favourable
| means of assessing inflation and taking into account housing
| costs more fully, I sense you'll find that the bottom two
| brackets are behind their 1970-adjusted counterparts, and the
| upper income bracket is significantly better off, especially
| if you then break that upper segment up a little into more
| categories.
|
| And, without something happening to adjust this, the effect
| is going to just get worse and worse, and everyone knows it.
| renewiltord wrote:
| Well, housing is obvious. It's because most Americans are
| eager to have community (by which they mean suburban homes)
| and a short commute and a separation between commercial and
| residential spaces. This is a process that clearly yields
| outcomes that are not time-invariant. In the same sense
| that asking "why did people back then get to put a house
| down near Golden Gate Park and I don't?" is meaningless.
| Because eventually all the places near GGP have houses.
|
| As Adam Driver points out in _Ferrari_ , "two objects
| cannot occupy the same place at the same time". A view some
| might find counterintuitive.
| discodonkey wrote:
| It seems to be using the CPI. The basket of goods &
| services the CPI is referencing is determined by the
| extensive Consumer Expenditure Survey, and reflects to a
| fair degree the actual spending habits of Americans.
|
| Obviously, if you give more weight to housing, you're going
| to get different results. But it would distort the actual
| change in expenditure.
| xracy wrote:
| Why wouldn't you include housing? It's often people's
| largest expense?
| Eric_WVGG wrote:
| That first link is not adjusted for inflation.
|
| $1 in 1970 == $7.54 in 2022
|
| That 1970 middle-classer would be making around $450k in 2022
| dollars, which sounds insane, but I also know my parents had
| normal jobs and were able to buy a house shortly after
| getting out of college.
|
| https://www.bls.gov/data/inflation_calculator.htm
|
| (yes we all have more luxuries than back then, toys got
| cheaper, necessities exploded in cost)
| collingreen wrote:
| We've had terrible times without completely failing before but
| I agree with some of your sentiment. That isn't much solace at
| all but maybe it won't be the end of the entire experiment?
|
| The extreme wealth gap and corruption paired with the loss of
| virtue (integrity seems to hold very little social value these
| days) seems like a bad mix to me if you like stability, let
| alone shared prosperity. Moreover, the response to the United
| healthcare assassination showed us that a bunch of folks don't
| think there is justice left in the system. The reactions to
| covid were a stark example of how a huge swath of people not
| only won't lift a finger to help their fellow citizens but will
| actively oppose it and be offended by the suggestion itself.
| This year the purges of non-straights or non-whites from all
| positions (and even from some records!) began and we don't yet
| know where that will end. Politically we've spent this year
| alienating our allies and generally acting like bullies.
|
| I'm worried we'll be in a war in 3.5 years (real or
| manufactured) and "need" to delay the next election for a
| while, "in the name of national security".
| pmarreck wrote:
| > a fair piece
|
| Who defines what is "fair"? If it's people, people are
| imperfect AF and centralized planning economies tend to fail
| spectacularly.
|
| I would agree that a system can be unfair, but what changes to
| the system are sustainable while still incentivizing risk-
| taking and achievement?
| eddd-ddde wrote:
| Raise taxes to 80% after making more than a million a year?
| That's more than enough of a ceiling to keep incentives for
| 99% of the population. And any taxed income comes back to the
| masses anyway. Of course this depends on having good
| government programs so that the money is not wasted or
| stolen.
| arp242 wrote:
| No one mentioned centralised planning until you brought it up
| yourself. This is just boring red-baiting.
| WalterBright wrote:
| > the rich have been transferring money from the poor to
| themselves at a dramatic rate.
|
| 1. The poor don't have money to be transferred to the rich
|
| 2. The top 1% pay 40% of the Federal income taxes
|
| 3. Medicare, Medicaid, Education and Social Security are wealth
| transfers to the poor
|
| The wealthy businessmen created their wealth, it was not
| transferred to them.
| ProllyInfamous wrote:
| Where is all this productivity [0] going, then, if not to
| wages? Is it just "disappearing" [unlikely, IMHO]?
|
| [0] researchgate.net/figure/US-Productivity-and-Hourly-
| Compensation-Source-Bureau-of-Labor-Statistics_fig1_270640833
| deadbabe wrote:
| I think there's another possibility: people eventually accept
| inequality and lower their expectations and ambitions for life.
| A lot of energy is wasted on trying to make everyone equal when
| the scales have become too tipped. At some point they're simply
| isn't enough activation energy left to right the ship.
|
| In the past (centuries ago), it seems like people simply
| accepted other classes were better and they could never be
| their equals. That's how you end up with royal families, etc.
|
| So in the future, people will simply work to the bone, find
| whatever pleasures they can when possible, and maybe just not
| wake up ever again on some morning before their shift starts.
| They will live in small simple residential units mostly for
| sleep, eating, bathing and watching some content on a screen.
|
| The rich will segregate themselves away to enjoy a finer life
| somewhere that they can be shielded from the plight of the
| poor.
| theGnuMe wrote:
| Or we could idk tax billionaires.
| stego-tech wrote:
| Cassandra here.
|
| This is what I've been struggling to articulate more succinctly
| since my college days, when I started really getting into
| macro-level systems analysis and long-term planning. Much of
| the Western world ceded pieces of its sovereignty to external
| entities without regard to the long-term consequences of said
| actions. Stuff like outsourcing domestic labor abroad, to
| countries like China (refining, manufacturing) or India
| (knowledge work) means those countries now have an outsized
| influence on domestic affairs that aren't easily clawed back.
| Ceding sovereignty of infrastructure (be it data centers,
| roads, hospitals, schools, etc) to private enterprise means
| those entities have dictatorial say over how those pieces of
| infrastructure are operated, maintained, and replaced.
|
| In essence, the limited sovereignty the West retained was
| broadly centered around consumption and wealth, opposing ends
| of a larger economic system that are now grossly out of
| balance. It's at the point where there is no singular "silver
| bullet" to fix it, either. Taxing the wealthy will _help_ , but
| absent meaningful reshoring of industry and jobs domestically,
| it won't actually right the economic ship. It's _also_ not
| merely an American problem, but one largely affecting the
| neoliberal West that spent decades outsourcing, offshoring,
| contracting-out, and generally doing everything possible to
| min-max cost vs returns, quarter after quarter. I think the
| only country _not_ substantially affected _might_ be Germany,
| but there 's still talk of automakers shuttering factories
| there in favor of using Chinese labor and shipping the vehicles
| back to save on costs.
|
| We have created a global economy but without global regulation,
| which in turn has resulted in artificially depressed
| consumption prices (relative to actual local costs) and
| artificially increased wealth extraction through rampant
| exploitation. Absent a singular global currency and standard of
| living (which, let's be real is _centuries_ away at the
| earliest), the only practical solution is a domestic rebuild of
| labor markets, supply chains, and industries, with a goal of
| refocusing national exports on what a country uniquely excels
| at rather than simply offshoring to whichever country has the
| optimal labor pool and exchange rate relative to your specific
| industry.
|
| It's a hot mess to be sure, but not unsolvable. Reshoring
| industry gives us an opportunity to re-evaluate supply chains
| and resource management with a focus on closed-loops and
| renewables. Reshoring work will boost wages and living
| standards, which in turn will boost birth rates and economic
| growth. Diversifying the economy back into regions and
| localities will promote specialization and innovation, rather
| than the fad-copying of today. There's a _lot_ of good to be
| had in facing the problem head-on rather than giving into
| fascist ideology and demagogues promoting "one easy trick" to
| fixing things, but all of it involves _hard, honest work_ ,
| which some folks will naturally be hostile toward.
|
| Either way, we'll all find out together, I guess.
| nickpsecurity wrote:
| Corrupt and fair are key points. I believe it comes from a
| change in worldview.
|
| The fundamentals used to be closer to the Bible's. They shifted
| to subjectivity, nationalism, authoritarianism (unchecked), and
| capitalism. Then, new groups around 1900 shifted to more
| subjectivity and atheism. Add pleasure-driven culture from the
| sequel revolution onward. Then, evolution, intersectionality,
| and feelings over facts.
|
| As I look at these, I see a dangerous combo of not seeing
| individuals with inherent worth, thinking people are like
| animals, believe/do whatever without long term consequences,
| and do what maximizes selfish gain, money or pleasure. Our
| problems are inevitable under that mindset.
|
| Let's look at specific examples in your post. The rich should
| take more wealth for themselves since that's maximizing selfish
| gain. The poor (or scheming) should also try to take their
| wealth by theft or welfare. If people get hurt, it's an
| unavoidable problem in a workd of conflict where the fittest
| survive. No objective morals even exist.
|
| Fortunately, we're seeing a growing rejection of those values
| leading to life transformations. That's a huge part of Trump
| getting elected since his policies are appealing to such
| people. The Spirit of Christ is also causing revivals across
| the country with thousands to tens of thousands gathered trying
| to change at the core. Inner change leads to outward effects.
|
| Right now, our college students are taught conflict theory,
| favoring specific geoups, subjectivism, work against our
| natural design no matter the losses, and
| pleasure/money/intellect are god.
|
| What will happen when college students instead are taught
| objective truth, doing what's right above all, building on our
| natural design, loving others with sacrifices made, helping
| those in need onto their feet, unity despite our differences,
| and building companies that are profitable within those
| virtues?
|
| I think the results will be beautiful. I've already seen places
| like that on a small scale. For big ones, Chic-fil-A and Hobby
| Lobby are pretty close. Part of God's design is some people
| will be rich and eventually generous. So, that won't change in
| most places.
| TheSpiceIsLife wrote:
| > the rich have been transferring money from the poor to
| themselves at a dramatic rate.
|
| How does this work? Where do the poor get wealth, on a
| continual basis, for the rich to take? If the poor have so
| little, and have had their fraction of the wealth taken by the
| rich for three decades, assuming things have got worse for the
| poor since the end of the eighties, where's all this wealth
| coming from?
|
| I'm not singling out here, this is a question for the general
| audience.
| m3kw9 wrote:
| Is not that they are seeking a transfer, but the incentives and
| system work is that it eventually converges to "poor get poorer
| and the money is transferred to the rich" as the most efficient
| way big biz makes money.
|
| What I like about NFL, NBA, MLB etc is that they will tweek the
| rules to make things competitive so the rich don't get too rich
| and win it all too much. We should have a "DOGE" system for
| rule tweeting to even things out once in a while
| rhynlee wrote:
| Seconding the Gary Stevenson rec, he frames in a very
| digestible way the flow of income from people working day to
| day being spent on modern day lifestyle (and necessities) to
| the people who own the assets modern lifestyles are dependent
| on and how this formulation of an economy may end up becoming
| increasingly unsustainable.
| gunian wrote:
| it's always hilarious to see people in the west wake up to the
| oligarchy
|
| no amount of graffiti and stickers will change what the numbers
| have always said since the days of theocracy and the deluge
|
| luigi sadly is not a revolutionary but a substitute for the car
| crash in Oklahoma :)
| henning wrote:
| The purpose of a system is what it does. The system is working as
| intended. This is not a problem for capitalism, this has always
| been the goal.
| the_gipsy wrote:
| Inheriting is the root cause of all corruption. We can never,
| ever, have a just society based on the principle of giving our
| children wealth that they did not earn nor deserve.
| polishdude20 wrote:
| It's almost a self fulfilling prophecy. Many people who have
| owned a house for the last 20 years got in at a lower price
| compared to their salaries. The only way younger people can get
| a house now is to inherit their parents wealth.
|
| Even if I work my ass off, I won't be able to afford a house
| the same as my parents did. My only hope is that I inherit
| their house when they pass.
| James_K wrote:
| What most people have yet to realise is that home ownership
| is a quite negative phenomenon. The dual of owning a home is
| the ability to deny others access to housing. People who are
| particularly attached to the capitalist system will suggest
| crazy solutions like a limit on the number of houses per
| person, but the real solution has always been government
| ownership of all land. There is no advantage to privately
| owned land except the ability to horde it and create waste,
| or rent it out and create inefficiency.
| dgfitz wrote:
| > The dual of owning a home is the ability to deny others
| access to housing.
|
| How do you figure? Are we out of land? I would argue we are
| not, at all.
| James_K wrote:
| What is owning a home? It is having the power to legally
| demand other people leave it. Hence owning a home
| requires the ability to rent out a home, and to to rent
| out many homes and drive up the price. Likewise we have
| much land, but it has not been developed because people
| own it. In a system of government ownership, they would
| eventually be outbid on the lease for their land and it
| would be developed into a larger amount of affordable and
| higher density housing. Instead people own that land and
| are able to keep it underdeveloped at the cost to
| everyone else, then use this leverage to enrich
| themselves through the increase in house prices. There is
| no positive argument for the private ownership of land
| over public ownership.
| dgfitz wrote:
| > What is owning a home? It is having the power to
| legally demand other people leave it.
|
| A home is where people feel safe and secure with their
| family, or by themselves.
|
| I reject the premise of your re-definition of owning a
| home.
| James_K wrote:
| Well as nice as the sentimental definition you gave is,
| the legal definition of home ownership revolves around a
| set of rights granted to you by the government over a
| plot of land. I could feel safe and secure with my family
| a t Pizza Hut, but I don't own Pizza Hut.
| donavanm wrote:
| Just say "ownership is theft" if thats what your argument
| reduces to. That said, I think the concepts around
| georgism and dynamic value based taxes are a bit more
| interesting and address the "land banking" concerns you
| inserted.
| James_K wrote:
| > dynamic value based taxes
|
| I hate having to explain this to people, but a tax based
| on the value of something is called rent. Georgism is a
| system where the government owns all land and leases it
| out, but then the call the rent a "tax" to make it more
| palatable to people who are afraid of public ownership.
| donavanm wrote:
| Thats a pretty reductive world view. I suppose "the
| monopoly of force and law implies control, and quote-
| unquote ownership, by the state."?
|
| So, mission accomplished? The state already compels me to
| pay annual taxes based on the value of my titled real
| estate, my car, my income, my foreign assets, etc... I
| guess Im just renting it all from the state?
|
| Mind you Im no John Birch-man here. I actually pay 42% of
| my income in taxes, and think real property _should_ be
| taxed more effectively here in AU. But jumping all the
| way to "ownership is theft, and taxes are double secret
| ownership" doesnt seem particularly useful.
| James_K wrote:
| > Ownership is theft
|
| You are trying so desperately to put those words in my
| mouth, but I will not say them as I don't know what they
| mean.
|
| > taxes are double secret ownership
|
| I'm not making an ideological point here, simply pointing
| out that the proposed systems are isomorphic in their
| objectives and execution. They both aim to increase the
| productive use of land by charging a periodic fee to the
| occupants of said land based on the market value of the
| land. There are two differences: the first is one of
| language (rent vs. tax), and the second on how the rate
| of this fee is determined. Under socialised land, the
| market price of land is the same as the fee charged.
| Under Georgism, the fee is charged by a bunch of
| politicians looking at the market price of land and
| trying to figure it out based on that.
|
| Given that the two systems are essentially identical, but
| the second brings in undue political meddling, I see no
| reason to prefer it to the first solution outside of the
| practical situation that many people are afraid of public
| ownership and therefore would be more likely to vote for
| the worse option. Do you have any real argument for
| Georgism over public ownership?
| donavanm wrote:
| Honestly, he argument you make is quite confusing as it
| seems to conflate ideas/terms[1], redefine language[2],
| and draw distinctions[3] at will. It's a bit hard to
| reason about something when it mixes interpretations of
| 'what is' with 'what could be'.
|
| You're conveniently glossing over issues like price
| discovery (auctions?), periodicity (annual?), and what I
| suspect are some pretty large inefficiencies implied by
| requiring continual re-bid/repurchase of existing real
| property vs a small proportional tax. Im an amateur, no
| graduate degree in economics here, but I would wager
| there's a reasonable amount of literature around the
| benefits of surety of title and depth of markets for
| efficient discovery to support a distributed, private,
| ownership & transaction model.
|
| WRT "scary" ownership, as I said I live in Australia. I
| understand what crown land is, title, registry, and how
| we've transitioned through those ~3 times in 200 years.
| That's actually another example where some
| proclamations[4] don't quite hold up; Land ownership in
| Australia _is_ owned by the crown already. I merely hold
| (indefinite) title, so maybe 'government ownership' isn't
| quite the panacea? I do find our current real property
| and capital rate mechanisms deficient, and would
| appreciate something a lot closer to an annual LVT.
|
| When you say "... the real solution has always been
| government ownership of all land. There is no advantage
| to privately owned land ..." don't act surprised if you
| get lumped in with those who argue against private
| ownership of real property.
|
| [1] "The dual of owning a home is the ability to deny
| others access to housing" [2] "a tax based on the value
| of something is called rent" [3] "Given that the two
| systems are essentially identical, but the second brings
| in undue political meddling" [4] "...the real solution
| has always been government ownership of all land."
| James_K wrote:
| > I suspect are some pretty large inefficiencies implied
| by requiring continual re-bid/repurchase of existing real
| property
|
| You are incorrect to suspect that. The price must still
| be discovered in the Geogist system through market means,
| and the additional burden of rediscovering it to issue
| the tax means doing that work twice. You are on a
| software forum so I assume you understand computers well
| enough to appreciate that the effort required for this in
| practice is essentially zero. A system sufficient to
| serve an entire nation of people could be programmed by
| perhaps ten engineers.
|
| > I would wager there's a reasonable amount of literature
| around the benefits of surety
|
| You can't just assume someone else has made your point
| for you and expect me to buy that. The system of
| government ownership can provide any degree of surety
| depending on how its implemented, but in general the
| objective of both systems is to force people to sell land
| instead of hording it, i.e. to reduce the surety people
| have over their ability to occupy land indefinitely.
|
| > a tax based on the value of something is called rent
|
| This is not a redefinition of language, but a simple
| observation that the two things are identical in
| practice.
|
| > don't act surprised if you get lumped in with those who
| argue against private ownership of real property.
|
| I don't care how justified you feel in mischaracterising
| my views.
|
| > so maybe 'government ownership' isn't quite the
| panacea?
|
| Yes, clearly if you read my argument made thusfar it
| dictates that government ownership is only effective when
| it is leased back to people in a market fashion. "The
| government owns it but you have an indefinite lease with
| no charge" is another example of changing the language of
| something without changing the practice of it. In
| practice, you own that land.
|
| Finally, I am going to ask that you no longer attempt to
| find differences between Gerogism and social ownership.
| When you look at the actual implementation of both
| systems, they are the same. Any policy in Georgism has a
| one-to-one equivalent policy under government ownership.
| In fact Georgism is equivalent to a government ownership
| system with the following setup:
|
| 1) Leases are indefinite.
|
| 2) A substantial upfront cost is levied against people
| who wish to acquire a lease, determined by the highest
| bidder.
|
| 3) The charge on a lease is determined by some fraction
| of the upfront cost on surrounding leases of buildings.
|
| Having observed this, we can see that it could be
| improved by removing the upfront cost, and instead have
| the lease determined by the leases on surrounding
| buildings when those buildings are vacated and the lease
| is put back up for auction. Forced renewal of leases is
| not necessary under a government ownership system as the
| increase in lease prices should be enough to naturally
| remove under-performing businesses. However the
| opportunity to renew a lease gives you a positive
| advantage over a Georgist one: if you feel your rent is
| too high, you can subject it to market scrutiny by
| voluntarily ending the lease on the property and offering
| the highest bid in the resultant auction.
| janalsncm wrote:
| One difference is that the government can choose not to
| renew a lease on land it owns. Eminent domain exists but
| it is a lot more messy.
| James_K wrote:
| Nope. The government could own all land and have the same
| system for withdrawing leases as is currently employed
| for eminent domain. You might say the government could
| change that system, but it can also change eminent
| domain. This is not an inherent difference of the two
| systems. One could even envision a system where the
| government has no ability at all to withdraw a lease and
| thus occupants are more safe than they would be under
| eminent domain. On a practical level, the Georgist system
| might even be more likely to turf people out than a
| social land system, because presumably the land tax would
| increase to price people out at the market rate, where a
| lease agreement is more likely to have controlled
| increases.
| IncreasePosts wrote:
| > It is having the power to legally demand other people
| leave it
|
| Renting gives you that power too
| Etheryte wrote:
| I'll bite, why do you think a limit on how many homes a
| person can own is a bad thing? Let's clearly separate homes
| and other real estate here, so shop floors, factories,
| warehouses, etc are out of the equation. Since you mention
| inefficiency, how many homes can one person realistically
| reasonably use?
| James_K wrote:
| I think it is better than the current situation but worse
| than the optimal situation, that is government ownership.
| What's more, ignoring commercial land ignores that many
| commercial enterprises would benefit from the proposed
| solution in the same way people living in houses would,
| yet there is no mechanism by which you could limit one
| company to a single building of operation.
|
| > how many homes can one person realistically reasonably
| use?
|
| This question is why I consider the solution of a limit
| on ownership stupid. A person can reasonably use however
| many houses which they can afford to rent. It isn't up to
| me to decide what counts as reasonable use. It is simply
| a question of whether other people would be willing to
| pay more for some other purpose. Suppose someone wishes
| to purchase an entire abandoned town and can do so at a
| relatively low rate due to it being abandoned, I see no
| reason to deny them them this, yet a limit on home
| ownership would do precisely that.
|
| One should also note that a land tax is another inferior
| solution to the problem. It is effectively a government
| lease on land which doesn't allow the rent charged to be
| determined by market forces. What makes total government
| ownership of land the most practical solution is that it
| most closely follows market principals. Usage of land is
| contingent on productive revenue from that land in excess
| of the revenue generated from alternative usages. Any
| other solution will fall short of the optimal allocation
| of resources which the market provides.
| gruez wrote:
| >but the real solution has always been government ownership
| of all land.
|
| They have that in China. How's that working out for them?
| defrost wrote:
| Sounds made up .. how do you explain nail houses in
| China?
|
| https://www.theguardian.com/cities/gallery/2014/apr/15/ch
| ina...
|
| Maybe take the BS elsewhere?
| gruez wrote:
| Please do some research before accusing people of "BS".
|
| >In general, rural collectives own agricultural land and
| the state owns urban land. However, Article 70 of The
| Property Law allows for ownership of exclusive parts
| within an apartment building, which endorses the
| individual ownership of apartments.
|
| https://en.wikipedia.org/wiki/Property_law_in_China
|
| >Individuals cannot privately own land in China but may
| obtain transferrable land-use rights for a number of
| years for a fee.
|
| https://maint.loc.gov/law/help/real-property-law/china-
| real-...
| defrost wrote:
| Rural collectives own agricultural land is _not_
| "government ownership of all land" which _you_ asserted
| to be true.
|
| Moreover, the devil's in the details: (
| In China, your maint.loc.gov ) According to the 2007
| Property Rights Law, when the term for the right to use
| land for residential purposes expires, the term will be
| automatically renewed
|
| Which means that residential land use rights persist, as
| they do in the US, and while mineral rights remain with
| the state it's _not_ the case that all land ownership in
| the US comes with mineral rights, these may have been
| signed awy by prior owners or retained by the State or
| Federal Government whe first transferred.
|
| Both countries are more complicated than you sweepingly
| make things out to be.
| donavanm wrote:
| This is pretty basic knowledge, there is only State and
| Collective owned land in the PRC. Individuals can only
| obtain _leases_ of State owned land. Property rights of
| _buildings_ are distinct, but will generally follow land
| title/lease.
|
| https://english.www.gov.cn/services/investment/2014/08/23
| /co...
| defrost wrote:
| Collective ownership isn't State or Government Ownershaip
| (negating the "all land" part) and in China "State
| Ownership" is an underlying ownership that doesn't carry
| the weight of immediate direct ownership, hence nail
| houses where individual lease holding rights that are
| automatically renewed trump the underlying state
| ownership.
|
| Point being, it's not as simple as it's made out to be
| and it's not dissimilar to many other countries that have
| a notion of underlying ownership, seperation of surface
| and mineral rights, cave outs for eminant domain, etc.
|
| In this _specific_ context it 's not especially clear
| what the GP's "how's that working out for them" is meant
| to convey.
| EVa5I7bHFq9mnYK wrote:
| Problem is, homes have two functions: a place to live and a
| wealth preservation vehicle. As a result, many homes are
| owned by those who have no need to live in that particular
| place. Bitcoin can substitute some wealth preservation
| functionality, because it has the same scarcity property as
| the land, thus improving the housing situation.
| mandmandam wrote:
| > Inheriting is the root cause of all corruption.
|
| The way the ultra-wealthy manage to make it entirely taxless;
| super evil for sure. Even so, it's not really _the_ root -
| maybe a very large branch of it.
| TZubiri wrote:
| What about gifts? Does it follow that gifts are a form of
| corruption, that exchanges need to be equivalent? Or how would
| you, for both practical law application as well as moral
| purposes, distinguish an inheritance, from a gift before death,
| from a gift in life, from providing shelter in youth and from
| giving a the gift of life through a part of oneself?
| treis wrote:
| A gift is one person giving something to another. An
| inheritance is ultimately someone else's kids giving your kid
| something.
| donavanm wrote:
| This isnt abstract, modulo reasonable thresholds Gifts are
| taxed as income by value in most countries. Inheritance (in
| the US) _is_ the weird wealth transfer exception.
| TZubiri wrote:
| Interesting.
|
| Just checked and in argentina there is no federal tax gift,
| and in some provinces it's just much lower. We also have a
| wealth tax so that may address the gen wealth issue in
| another manner.
|
| Tax is like that different in every country and hard to
| compare apples to apples.
| donavanm wrote:
| Entirely fair point, and it always makes internet
| discussions more complicated without innumerable caveats.
| ConspiracyFact wrote:
| Nonsense. In order to focus on the supposed injustice of
| _inheritance itself_ , suppose that someone becomes wealthy
| through ethical means. If they then turn out to have a mutation
| that causes them to be immortal, at what point does it become
| just to simply take their wealth away from them? If your answer
| is "never", why is it any different if they gift their wealth
| to their descendants? Why is gifting wealth wrong?
| the_gipsy wrote:
| > suppose that someone becomes wealthy through ethical means
|
| If you dig deeper and deeper at this point, your argument
| will eventually come to a halt, before even getting at crazy
| theoretical mutations.
| Eridrus wrote:
| The reason to let rich people keep their money is twofold:
| ethical economic activity is positive sum and rich people
| have shown an ability to generate these positive spillovers,
| and letting them keep it gives them an incentive to engage in
| this economic activity in the first place.
|
| The former does not apply to heirs, and the latter only
| weakly applies.
| alexey-salmin wrote:
| The desire to help your offspring is a very deep part of the
| human nature. Any way to prevent that is inherently inhumane. I
| don't think such system can last long (and coincidentally they
| never did).
| FirmwareBurner wrote:
| Until the children of the have nots outnumber the children of
| the haves and kill them and take their stuff by force. That
| was also human nature in the past.
|
| That's why we have wealth taxes to even the playing field and
| encourage children of the have-nots to putting their effort
| in work and contributing in the system instead of on way to
| murdering the children of the haves for their stuff.
|
| It's sort of protection tax the wealthy have to pay to live
| in a safe society that benefits them since their wealth comes
| from the work of the poor.
| alexey-salmin wrote:
| I actually agree with that, even though it's not certain
| wherever the "revolt of have nots" could be held off
| forever or it's inevitable.
|
| However my point is that there's a huge difference between
| demanding a wealth tax and the "inheriting is the root
| cause of all corruption" approach. Former is a measure to
| preserve status quo, latter is a dangerous utopia.
| globular-toast wrote:
| Yep, and the poor majority who don't benefit from it will
| fight to protect their right to do it.
| bgun wrote:
| The idea that an average person, working hard, can eventually own
| part of a nation's land and resources, setting up their family
| with generational wealth, is derived from the pioneer days when
| land was plentiful.
|
| This was never going to be able to last forever as long as the
| population keeps increasing. This is why settlers left Europe etc
| in the first place to seek fortune overseas. And since there is
| no un-owned land remaining, the market price for land will match
| or exceed regional population growth worldwide forever, unless a
| whole lot of people start dying.
|
| Working hard is necessary in its own right for many reasons, but
| promising everyone that if they "work" hard enough, they too can
| set up their heirs, is pure marketing. So is shaming anyone who
| fails to achieve it as "lazy", when it was never going to be
| possible for more than a fraction.
| sc68cal wrote:
| > the pioneer days when land was plentiful.
|
| I think you mean to say "When we could steal land from the
| people who were originally on that land"
| echelon wrote:
| > "When we could steal land from the people who were
| originally on that land"
|
| That's every single society ever. This has been the
| civilizational algorithm. It predates our species.
|
| That same tactic is alive and well today.
| milicat wrote:
| A gross oversimplification of anthropology.
| James_K wrote:
| I don't think so. How many genocides can you think of on
| the scale of the Native American genocide? Such events seem
| rare to me.
| echelon wrote:
| Apart from the Sentinelese, I can't think of one
| civilization that hasn't warred and taken over land and
| resources from others. And we really don't have proof the
| Sentinelese didn't do this at some point themselves.
|
| History was full of violence.
| James_K wrote:
| You can think of many examples of war and conquest, but
| what happened in America is more than just war. Genocide
| is more than just war. Framing the atrocities upon which
| the US was founded as merely "historically normal" is a
| deeply revisionist view of history. Technological
| development at that time allowed for many great evils
| which were simply not possible before.
| ConspiracyFact wrote:
| How do you know that what happened to the natives was so
| much worse than the hundreds if not thousands of similar
| fates that must have befallen other cultures over the
| last several tens of thousands of years?
| James_K wrote:
| Because the things you're referring to didn't happen.
| That's why you say they "must have happened" instead of
| "actually did happen". I can think of some examples of
| similar treatment, for example the British in Scotland,
| Wales, and Ireland around that time, but even then we see
| that there are many living natives in those lands today.
| America is unique in that the overwhelming majority (97%)
| of the population is non-native and has no native
| ancestry.
| WorkerBee28474 wrote:
| Rare in absolute numbers, but not rare on a percentage
| basis.
|
| That was, what, a 95% extermination? Native Americans
| probably committed 100% exterminations e.g.
| https://en.wikipedia.org/wiki/Dorset_culture
| yulker wrote:
| European colonization of the world is a unique enough
| phenomenon to not hand wave it away as business as usual.
| Further, the industrial intensification and
| financialization of this colonization through the 18th-20th
| centuries alone is singular on its impact on human
| civilization with no precedent.
| 01HNNWZ0MV43FF wrote:
| > It predates our species
|
| People will really say this and then still be mad when I
| want to marry just a couple of my cousins
| dpc050505 wrote:
| Most first nations at first contact had 0 conception of
| ownership, rather seeing it as some sort of stewardship (or
| if you put it in modern terms you could use the marxist
| notion of personal property where it's 'use it or lose it')
| as well as low enough populations that they figured there was
| enough to go around to share the land with settlers.
| watwut wrote:
| Except it was not shared, it was almost a genocide.
| scarby2 wrote:
| genocide is an intentional act. Smallpox did 90% of the
| work and nobody lifted a finger, at the time nobody could
| have forseen the effect of smallpox on the native
| population.
|
| After smallpox when the population of the Americas had
| been reduced by something like 90% they most certainly
| didn't need all the land.
| fc417fc802 wrote:
| > at the time nobody could have forseen the effect of
| smallpox on the native population
|
| Are you really unaware that the colonials intentionally
| spread smallpox to the natives? This is not some obscure
| detail - it's in approximately all of the history
| textbooks in a fair bit of detail.
| IncreasePosts wrote:
| Sure, some tried, but smallpox and other diseases were
| doing a great job on their own. It didn't need a few
| blankets to make it a real pandemic.
| Aloisius wrote:
| The few references to potentially intentionally spreading
| disease, all well after they were spreading in the
| Americas, are unlikely to be the cause of more than a
| tiny sliver of deaths due to disease. The timelines
| simply do not match.
| jfengel wrote:
| And yet we took 100% of it, and forcibly relocated the
| survivors.
| ConspiracyFact wrote:
| If the settlers had done what the first thousand or so
| invading cultures did and just exterminated the natives,
| they would have been able to cast them in whatever light
| they chose. Instead they gave them rather a lot of
| autonomous territory relative to their population, along
| with legal monopolies designed to prevent them from being
| forced into wage slavery.
|
| Oops!
| watwut wrote:
| It was an intentional act. They wrote about it being an
| intentional act. The violence was not an accidental nor
| rare event either, it was an intentional act too.
|
| The east expansion took a lot of time, involved quite a
| few massacres and invonluntary relocations.
| stanleykm wrote:
| Nothing almost about it. This and the smallpox thing the
| sibling brought up are what we tell ourselves to feel
| better about what the truth is.
| FireBeyond wrote:
| And if there happened to be people on the land they
| "wanted" well then there's guns and smallpox blankets to
| take care of those pesky details.
|
| "The people there didn't have the concept of ownership" but
| some pioneers sure as hell made sure to enlighten them by
| laying claim to that same land and then threatening anyone
| for encroaching on it.
| James_K wrote:
| Even if the land was "shared", settlers still stole it for
| themselves.
| giantg2 wrote:
| Source?
|
| Some of the nations were large, such as the Aztec. And at
| least a few of them understood right by conquest. They also
| had extensive trade routes across the continent, seeming to
| disprove the lack of ownership.
| int_19h wrote:
| You seem to be confusing the concept of "ownership" with
| that of "private property" (on immovables, especially). The
| "Marxist notion" of personal property still requires the
| concept of ownership.
| lurk2 wrote:
| If the land had been the basis of North American prosperity
| there would have been civilizations there capable of
| resisting European colonialism.
| James_K wrote:
| The Americas had no horses before Europeans brought them.
| TylerE wrote:
| Long since debunked
|
| https://www.smithsonianmag.com/smart-news/native-
| americans-s...
| dddddaviddddd wrote:
| > The Americas had no horses before Europeans brought
| them.
|
| > Long since debunked
|
| I mean, the linked article says horses were introduced in
| the 1600s (brought by Europeans), and then spread
| throughout the Americas without requiring further
| European distribution.
| TylerE wrote:
| The article says the horses were in the Americas millions
| of years ago.
| rezonant wrote:
| And then died out, before Cortes brought them back to the
| continent in 1519. Native Americans then discovered the
| horses before they ran into the Europeans and began
| spreading them across the country.
|
| > Horses evolved in the Americas around four million
| years ago, but by about 10,000 years ago, they had mostly
| disappeared from the fossil record, per the Conversation.
| Spanish settlers likely first brought horses back to the
| Americas in 1519, when Hernan Cortes arrived on the
| continent in Mexico. Per the new paper, Indigenous
| peoples then transported horses north along trade
| networks.
|
| Don't forget to read the whole article!
| a2tech wrote:
| Horses in North America are a weird one. I believe the
| current thinking is that horses started in North America,
| migrated to Asia, then the population died off after the
| continents split. So there were horses in the Americas
| prior to the Europeans, but also potentially before
| humans.
| James_K wrote:
| Humans and horses probably did that thing where you're
| looking for someone and you go to where they are then
| they go to where you are and you both miss eachother.
| James_K wrote:
| > Spanish settlers likely first brought horses back to
| the Americas in 1519
|
| This seems very compatible with what I just said.
| giantg2 wrote:
| This article is saying the native Americans spread the
| horses faster than the Europeans spread. They still
| sourced the original horses from Europeans in the 1600s.
| dgfitz wrote:
| Others disagree.
|
| https://www.smithsonianmag.com/smart-news/native-
| americans-s...
| James_K wrote:
| > Spanish settlers likely first brought horses back to
| the Americas in 1519
|
| No they don't.
| dgfitz wrote:
| I uh, source?
| James_K wrote:
| https://www.smithsonianmag.com/smart-news/native-
| americans-s...
| selimthegrim wrote:
| I think the issue was whether they were hunted to
| extinction or not
| andrepd wrote:
| Yes they did, even if they were present in the continent
| before humans, they died out at least 10ky ago.
| andrepd wrote:
| Also no sheep, no dogs, no cows, no chicken.
| lurk2 wrote:
| Native Americans did have dogs. They didn't have sheep,
| but the Incans did have access to wool-bearing animals in
| the form of the alpaca (though the Incan Empire was
| geographically isolated so these animals never reached
| North America). Guinea pigs were also domesticated in
| this region. There were neither cows nor chickens, but
| there were other forms of poultry such as turkeys and
| ducks.
| stanleykm wrote:
| what
| casey2 wrote:
| The truth has always been and will always be that the people
| who are most technologically advanced will end up with the
| land, weather by force or purchase.
|
| Simply due to the fact that it's more valuable in their
| hands. Driving out some campers to build a town is the rule,
| not an exception.
| pfannkuchen wrote:
| More valuable? More valuable... to whom?
|
| In human affairs there is no such thing as absolute value.
|
| The reason is simply that it is inevitable as much as
| gravity is inevitable.
|
| Making a moral law against gravity isn't going to get you
| very far.
| giantg2 wrote:
| Define "orginally". You might be interested to research how
| the Native Americans interacted, especially the Lakota.
| Rights by conquest was not a new idea.
| andrepd wrote:
| Well the obvious response is then "can _I_ conquer your
| land by force too? ". No. Because there is a construction
| of "lawful property rights" that starts with the
| appropriation of land by force but protects the new owner
| from the same.
| pcthrowaway wrote:
| Well technically the land can still be appropriated by
| force, only you have to apply it against the entire
| system which enforces "lawful property rights"
| whamlastxmas wrote:
| The most human thing ASI could do would be to have its
| own Manifest Destiny
| flutas wrote:
| or just use the system which enforces "lawful property
| rights"
|
| see: Adverse Possession
| 01HNNWZ0MV43FF wrote:
| I mean murder's not a new idea either but it's broadly
| condemned in most moral vibes
|
| "Right by conquest" is sort of a cope, like "You might have
| a green light and the right of way, but Isaac Newton always
| favors the semi truck"
| asdf6969 wrote:
| There were a few hundred thousand of them across the entire
| continent. In the best case scenario, most of them still
| would have died to disease. Unless you believe a few hundred
| thousand people own should own an entire continent as their
| blood and soil birthright the land was always going to end up
| like this
|
| There's still a lot of land out there. The only problem today
| is nobody wants to start over with no plumbing, electricity,
| or other modern conveniences.
| codingdave wrote:
| The numbers you mention don't match what I see here: https:
| //en.wikipedia.org/wiki/Population_history_of_the_Indi...
| asdf6969 wrote:
| You're right, I mistook the Canadian numbers for all of
| North America. I know south and Central America had a
| much higher population but that's not what this thread is
| about. It looks like a more accurate number is in the low
| millions so my point still stands.
| 01HNNWZ0MV43FF wrote:
| I'm gonna go conquer Georgia, then. Genocide some country
| folks, burn every Confederate flag I see, end some
| bloodlines forever. There's not many people living there,
| right by conquest, etc., plus Reconstruction wasn't
| finished properly anyway.
| asdf6969 wrote:
| Hell yea brother. Blood and soil. Georgia is for the
| Georgians and nobody else should be allowed to settle
| there
| IncreasePosts wrote:
| If you steal something from someone who stole something, I'm
| not going to cry for the original thief.
| 01HNNWZ0MV43FF wrote:
| Most of us were born into land that was colonized in
| written memory.
|
| I would definitely cry for the death of the innocent
| grandchildren of thieves.
| araes wrote:
| We can still steal land from people who were originally on
| that land, happens all the time in America.
|
| - Land Appropriation for "Public Need" with Direct Transfer
| to Wealthy: https://fastercapital.com/content/Land-
| appropriation--The-In...
|
| - Heirs property, property tax sales, and Torrens Acts
| (article focuses on black people, yet works equally well on
| all skin colors): https://inequality.org/article/black-land-
| theft-racial-wealt...
|
| - Wealth City / Suburb secession to leave poor areas to pay
| bills, and then buy them in destitution: https://www.bloomber
| g.com/news/features/2022-02-11/atlanta-s...
|
| - Rezone areas to make new cities, take all the businesses
| and good land, and leave the remaining "city" with the bills
| (another Atlanta idea): https://www.google.com/maps/place/Uni
| on+City,+GA/@33.6158433...
|
| - Sell vacant land out from under land owners with false
| listings: https://www.fbi.gov/contact-us/field-
| offices/newark/news/fra...
|
| - Purposely Induced Foreclosure, Bankruptcy or surprise tax
| assessments to cause a forced sale:
| https://www.businessethicsnetwork.org/forced-sale-
| implicatio...
| TZubiri wrote:
| " This is why settlers left Europe etc in the first place to
| seek fortune overseas."
|
| And why you guys are looking at Mars now.
|
| Here in latam we haven't filled the land at all, you guys have
| been hard working and filled with riches. But our laziness
| might give us more longevity, we are playing the long game with
| the amazon
| hnthrow90348765 wrote:
| LATAM will get a lot of remote work if the wages stay lower
| than the US since they're in better-for-US-company-timezones
| than India or others overseas. That's what my company is
| outsourcing to.
| TZubiri wrote:
| Yeah, looks like the go to strategy, but I may have to pass
| on the gold mine and go for the higher payoff of a decent
| living but a more spiritually fulfilling trade diplomacy
|
| In international trade there's complementary/productive
| trade, you have gold, we have silver, let's trade. And you
| also have redundant/substitutive trade, you have soy, we
| have cheaper soy, buy our soy.
|
| I don't believe from the bottom of my heart in substitutive
| trade for similar reasons I don't believe in (most)
| inmigration. We've conquered the americas, now we have to
| populate it, god won't reward desertors who revert their
| ancestor's decision by running back to the old continent,
| and the excuse of "I was born in the wrong hemisphere" is
| also quite petty, we rolled the dice and this is what we
| got.
|
| Substitutive trade isn't far from immigration, the poor
| want to go to the rich countries, and the rich buy the
| cheap labour. Where is the pride in that? In both sides.
| Leave your country for another with a different religion,
| leave your mother your brethren, and serve. Leave a war
| instead of fighting? Take a 1 hour bus to a fancy
| neighbourhood to serve coffee and wash dishes. Conversely,
| you can wash your own dishes, you can use a bottle of water
| and fill that up before you leave, we don't need a migrant
| washing our dishes, and we don't need to migrate to wash
| dishes.
|
| So I'm trying to focus on trade that is not replaceable
| with local labour, hopefully countries start nailing down
| remote work and we start locking those behind visas.
|
| And unfortunately india and philipinnes get that productive
| trade, they can cover night shifts.
|
| We'll find stuff to export. There's not much, as Trump said
| "they need us more than we need them".
|
| Local entertainment, sports and games will always be there,
| it's like cybertourism.
|
| there might be an argument for redundant trade as a
| counterweight to an unbalanced productive export. But I
| don't think that works long term.
|
| There's also localization services, in language and legal,
| but those are just costs of exporting really.
|
| Lithium is probably the lesser evil, super extractive, but
| we gotta pay somehow.
|
| Sorry about the super rant. Lately I've been more using
| forums as a way to write things that I already had drafted
| in my mind.
| dumbledoren wrote:
| Doubtful. Digital nomads, short-term rental tourism, real
| estate investors (prompted by the former two) are
| increasing housing costs and CoL in all the popular
| destinations. Costs in some regions like Barcelona almost
| got equalized with costs in major US tech hubs. The same is
| happening in places like Buenos Aires. So its unlikely that
| the trend in LATAM will continue as it is.
|
| Also, this is very bad for not only the locals as they get
| gentrified from living in their own city/urban centers (and
| in some cases even rural zones), but also the local
| companies: The US and other rich Western companies dump
| their healthcare and housing costs onto the locals through
| arbitration while making it harder for local companies to
| keep up with the CoL increase through wages, therefore
| increasing their expenses and reducing their
| competitiveness. And the reduced taxes that the nomads etc
| pay doesn't help it. (that is, the ones who actually pay).
| lurk2 wrote:
| > The US and other rich Western companies dump their
| healthcare and housing costs onto the locals [...] And
| the reduced taxes that the nomads etc pay doesn't help
| it. (that is, the ones who actually pay).
|
| Most nomads are going to be getting private health
| insurance. It's true that a lot of them are not paying
| their taxes, but if you're talking about Latin America
| that's true for a large portion of the domestic
| population as well. I looked into relocating to a country
| in South America a few years ago and had a lawyer tell me
| to not even worry about filling out the relevant visas
| because he had clients from China who had been living
| there for decades with no papers (I opted not to retain
| his services). The key here is that even if they aren't
| paying taxes, they are bringing money into the economy
| and are generally not competing with local laborers. This
| attitude has started to shift in places like Mexico City
| because a lot of the expats are not digital nomads but
| instead run-of-the-mill immigrants competing with the
| working population for jobs.
| umanwizard wrote:
| Rent in Barcelona is still way cheaper than NYC.
| foolfoolz wrote:
| land is still plentiful in the u. s. just maybe not where you
| want to be, similar to what a pioneer town might look like
| Gothmog69 wrote:
| I wonder about the economics of places with declining
| population like Japan and South Korea. I always read that
| declining population is bad for the economy but feels like
| those countries will have more opportunities for the young in
| the future.
| adverbly wrote:
| Land value tax would solve this.
| yapyap wrote:
| of course this was never going to last forever, we have more
| than 8 billion people in the world, if even 0.00001% of people
| wanted to do what you proposed, eventually own a part of a
| nation's land, thats 80 thousand people.
|
| that's just not happening
| lurk2 wrote:
| America isn't overpopulated. The pyramid scheme you're
| describing is not a Malthusian constraint but the product of
| bad monetary policy privileging non-productive investments in
| real estate. There's still no better place on earth for normal
| people to build wealth, unless you're playing the digital nomad
| game.
| thelamest wrote:
| It does not come about magically from monetary or even fiscal
| policy. The demand for housing (and other construction) was
| and is real. People find use for, and like having much space,
| while being close together. What was and is lacking is
| supply.
| lurk2 wrote:
| It was never implied that this mechanism was magical.
|
| If you reread the original post, the claim being made is:
|
| > The idea that an average person, working hard, can
| eventually own part of a nation's land and resources, [...]
| was never going to be able to last forever as long as the
| population keeps increasing.
|
| This is manifestly not the case. My response was that,
| insofar as a pyramid scheme exists, it has nothing to do
| with some fundamental Malthusian limit on how many people
| can fit in a given space; this limit exists, but is not the
| reason that the rich are getting richer, which instead has
| to do with monetary policy.
|
| You make cheap money available to those with good credit.
| These people take out loans and use the money to buy real
| property with the expectation that they will be able to
| rent it out for more than the carrying cost of the loan.
| This causes the price of real estate to rise artificially
| beyond what it would if the cheap credit had not been made
| available. The key issue here is that this credit isn't
| being made available to everyone at once - you have to
| qualify for the loan first.
| fc417fc802 wrote:
| > bad monetary policy
|
| Bad zoning policy, more like.
| yulker wrote:
| America has enough room to build many new cities in useful
| locations, yet it doesn't. Why is that?
| lurk2 wrote:
| I would contest the idea that this construction isn't
| happening - it's largely just resulting in sprawl at the
| periphery of existing cities. America has a lot of space
| available and a lot of space actively _being_ developed.
|
| As to why new cities aren't being built in completely empty
| areas, I would have to know where you're talking about to
| make a guess as to why they aren't being developed. Off the
| top of my head:
|
| 1) Environmental concerns 2) Expropriation concerns making
| projects politically untenable 3) The concerns of
| aboriginals 4) Cost of infrastructure development 5) Lack
| of market demand
|
| To elaborate on the fifth point, I would posit that people
| don't tend to populate such greenfield cities unless there
| is a compelling reason to do so; either by being pulled
| (e.g. by resource extraction opportunities, a growing
| economy, educational opportunities, etc.) or by being
| pushed (e.g. fleeing a war, the effects of climate change,
| or political persecution). China is the example to look at
| here. They spent most of the 2010s buying up an enormous
| amount of resources to build cities that ended up just
| sitting empty before eventually being demolished. A lot of
| this was just fraud (the buildings weren't constructed to
| be habitable to begin with), but at least some proportion
| of it had to do with the factors I mentioned above. The
| cost of physically moving to a new city, as well as the
| loss of social capital resulting from such a move make
| relocating to a new city both undesirable and prohibitively
| expensive for most people.
|
| Do you have another theory?
| alephnerd wrote:
| > Do you have another theory
|
| I do (becuase I've heard it from a buddy of mine who's an
| MD at a Bulge Bank) - there is no capital to invest in
| consumer real estate anymore.
|
| Large portions of that industry died out in 2008-12, and
| capital for large real estate projects like a housing
| community tend to be allocated 2-3 years before ground
| breaking, and then an additional 1-2 years to build.
|
| So to build a brand new community by 2020, you should
| have done all the leg work in 2014-16. And to build a new
| one today, it should have been done in 2019-20.
|
| Any pipeline that even existed is now dead, because
| manufacturing construction was the asset class of choice
| in the 2022-24 period along with high interest rates
| (making projects much more expensive) and tariffs on
| Canadian lumber, so the housing shortage is about to get
| even worse.
| Aurornis wrote:
| A big part of the problem is that too many people want and/or
| have to live in very tiny portions of the country: major
| cities.
|
| There is a lot of cheap land and even a lot of cheap houses for
| those willing to live in a different place. Even many of my
| friends in Seattle, for example, have discovered that if they
| move 30-60 minutes away their housing costs plummet
| dramatically. This has opened the door to many of them moving
| even farther away, unlocking an entire new world of
| affordability.
|
| There was a brief moment where all of this looked like it was a
| very real possibility for many of us, but the rubber band is
| snapping back with remote work and now many are being required
| to move back to those few cities again to find the best jobs.
|
| > but promising everyone that if they "work" hard enough, they
| too can set up their heirs, is pure marketing.
|
| I don't think most people believe that you can just work hard
| and then have generational wealth for your heirs. That feels
| like a strawman argument. Generational wealth has always been a
| difficult feat for the few, not something we promised everyone
| could achieve.
|
| However, people also underestimate the power of compounding for
| retirement savings. Obviously not helpful to someone working at
| McDonalds and trying to pay rent in a big city, but people
| working average mid-life jobs at average salaries who
| consistently save $100/month or more can amass significant
| retirement wealth over 30-40 years. Not "generational wealth"
| or "setting up your heirs", but enough to make big
| contributions to education, helping kids with emergencies,
| possibly leaving some non-trivial inheritance. This happens all
| the time and continues to happen with millenials, as it will
| happen with Gen Z. Again, not _literally everyone_ but to
| suggest that it 's out of reach is really out of alignment with
| the reality of what we see people earning and saving.
| koolba wrote:
| > but people working average mid-life jobs at average
| salaries who consistently save $100/month or more can amass
| significant retirement wealth over 30-40 years.
|
| You're off by _at least_ a factor of ten.
|
| 40 years of $100/month savings at a generous 5% compounding
| is $148,242. And that's in future dollars. Drop it to 4% and
| you're down $116,606.
|
| The real formula to consider is what percentage of your
| monthly spending you are savings. If it's 100%, then every
| month worked is one month of retirement. If it's 50% then two
| months of working is one month of retirement. If you live
| frugally and save 400% of your spend, each month counts as
| four retired months.
|
| It's a simple fraction with the numerator as your net savings
| and the denominator your total spending. And lowering the
| denominator scales things much faster.
| WorkerBee28474 wrote:
| 5% is not generous. 5% is conservative. 10% is historical
| for the S&P 500. 12% is generous.
| scoofy wrote:
| 7% is historical for S&P500, but that's with 3% average
| inflation. His point is that 5% _real_ returns are, in
| fact, generous.
| whamlastxmas wrote:
| Especially generous if you account for official inflation
| numbers doing a terrible job at representing income to
| cost of living ratio
| NoLinkToMe wrote:
| No he said 5% 'is in future dollars', i.e. not inflation
| adjusted to a present value... When in reality the
| nominal S&P500 returns are 10% leading to the same
| 'future dollars'. That is conservative.
|
| Plus if 7% real returns (after a 3% inflation) is the
| historical average, how is 5% real returns generous?
| That's still conservative even if he meant to claim a 5%
| real return.
| zusammen wrote:
| _And since there is no un-owned land remaining, the market
| price for land will match or exceed regional population growth
| worldwide forever, unless a whole lot of people start dying._
|
| Land use is a complex topic, but you're basically right.
| Everything good--not just land but social opportunities--is
| spoken-for and what we're seeing in South Korea and Japan is
| probably the best solution: peaceful natural attrition and non-
| replacement of capital's reserve army that is unwanted labor.
| 6stringmerc wrote:
| The Puritans became settlers in the New World because they were
| hated and thrown out of Europe / England so they set up shop
| and managed to derange society to this day in the US.
| giantg2 wrote:
| "is derived from the pioneer days when land was plentiful."
|
| Land is still generally plentiful. The need to all live in one
| spot is more social/artificial and really accelerated in the
| late 19th and early 20th centuries due to rapid urbanization.
| methou wrote:
| It does not have to be the "pioneer days", just saying this
| from Japan...
| nullc wrote:
| In the US you can buy land at quantity for, say, ~$1k/acre in
| places where there aren't people/infrastructure/etc...
|
| There is no shortage of land in the US. There is a shortage of
| land in a few high density areas. But increasing their density
| makes them more attractive.
|
| I don't think it's reasonable to make the pioneer comparison--
| if you want to do what pioneers did and build something from
| almost nothing in the middle of nowhere with great effort then
| there is still an analogous route open to you.
| EVa5I7bHFq9mnYK wrote:
| There is a lot of land for $100/acre. The main problem with
| that land is there is no water.
| wcfrobert wrote:
| Land is not scarce in the US. My road trip through Nevada to
| Salt Lake City convinced me of that much. What is scarce is
| land people actually want to live in - with safe neighborhoods,
| good schools, restaurants, shops, etc. Restrictive zoning and
| NIMBYism is definitely making this worse.
|
| I don't think the amount of "unexplored" or "undeveloped" land
| is a good metric for social mobility. Economic growth is. New
| "frontiers" are created all the time. They do not have to be in
| the physical world (e.g. computers, the web, biotech, the App
| store, social media influencer, crypto, and now AI). Even in
| the physical world, frontiers can sometimes expand. Desirable
| land can be created in the middle of a desert (e.g. Las Vegas),
| we just don't want to anymore.
|
| Despite its many flaws, I think the US is still better than
| pretty much anywhere else in the world.
| pfannkuchen wrote:
| Doesn't BLM control chunks of land that are desirable but not
| allowed for settlement?
| scoofy wrote:
| The point is San Francisco has tons of land (with houses
| already built on it) that _is desirable_ but not allow for
| redevelopment.
| Analemma_ wrote:
| Not really, no. The land the BLM owns is mostly scrubland
| suitable for cattle grazing and basically nothing else. I
| suspect whoever told you that has an ideological bone to
| pick with the BLM and is bullshitting you to try and make
| you equally mad at them.
| skybrian wrote:
| In much of the American West, water is the limiting factor.
| To build another Las Vegas, the water rights would need to be
| bought somehow.
|
| Cities can outbid agriculture, but the water rights market is
| complicated.
|
| A better example might be the California Forever project
| which seemingly had this figured out, but was blocked because
| they couldn't get permission.
| fireflash38 wrote:
| There's tons of land on the east coast too, just far away
| from people and amenities. See: rural WV, PA, VA, etc.
| skybrian wrote:
| Yes, and rust belt cities have lots of infrastructure
| that could be reused. Jobs are probably a limiting
| factor. Less so with working remotely.
| kjkjadksj wrote:
| Most of that rust belt infrastructure from mid century
| population highs is actually at end of life. Some cities
| are having a crisis with things like their sewer systems
| right now. Its underreported because no one cares about
| the intricacies of stormwater and sewage movements, much
| less in a smaller midwestern city.
| robotnikman wrote:
| This is one of the reasons I wish companies embraced
| remote work more, and which I wish the government
| encouraged more. Plenty of locations could be rebuilt and
| revitalized simply by moving working families there, and
| plenty of people would be happy to buy up the cheaper
| housing and contribute to the local economy if their
| places of work allowed for such flexibility.
|
| Its a real shame that both state and federal governments
| do not see the advantages of this...
| wwarner wrote:
| I want to agree with you but I don't see the difference between
| land and any other kind of asset ownership.
| nitwit005 wrote:
| The homestead act only ended in the 1970s. We were happily
| handing out land for free if people were willing to live there
| and work it quite recently.
|
| If there had still been a big demand for it, the program would
| probably still be running. They granted an extension to Alaska
| for that reason.
| andrepd wrote:
| Look at Georgism, and LVT. A 100% "tax" on the value of
| unimproved land would ensure the forces of market itself would
| push away from the situation you describe.
| ndsipa_pomu wrote:
| It always strikes me as bizarre that people can "own" land. It
| existed before you and will exist after you, so how can a
| short-lived being really "own" it?
|
| It would make so much more sense if land "ownership" was
| related to whether you live on or work that particular piece of
| land rather than relying on arbitrary pieces of paper that were
| mainly decided before any of us were even born.
| newsclues wrote:
| https://en.m.wikipedia.org/wiki/Title_(property)
|
| It's paying tax for owning something that is weird to me.
| ndsipa_pomu wrote:
| Isn't the tax paying towards a society that will respect
| your "ownership" so that you can have access to legal
| redress if someone prevents you using it?
| rsynnott wrote:
| This is a fairly simplistic/wrong view. If this were the case,
| say, you'd expect housing costs to be fairly reliably lower in
| low density European countries than high density ones. Spoiler:
| nope.
|
| In practice housing costs are driven by shortages of _housing_,
| not land. And these are quite different.
| TZubiri wrote:
| I think we need to shift from seeing inheritance as something we
| benefit from.
|
| Every positive comes with a negative, nothing is created nothing
| is destroyed.
|
| Chemistry found it to be so in the physical domain, confucians in
| the spiritual domain, and accountants in the wealth domain.
|
| I won't deny that you CAN ignore the responsibilities that come
| from inheriting wealth, yes you can sell your father's company
| and life mission, but you destroy your legacy, and your children
| will destroy yours.
|
| Wealth comes with its own set of problems if taken. Sure we may
| argue about which problems are worst, but must we? Each is born
| into a place, each is born into a class. And the principle of
| balance shall bring equity in the form of responsibility (to
| paraphrase Spiderman's uncle).
|
| I just feel it's a more appropriate response to tell your parent
| "I will take care of it" rather than "thank you" and selling it
| to go on trips and snort cocaine. I'm not saying I'm free of sin
| and don't indulge in the pleasures of hedon, be it in a coffee
| (brought to me by a less attractive waiter of a distinct race
| from other commensals serving a publicly traded company, and made
| with beans grown and brought under a veil I can assume hides even
| more injustices) or in the wasting of my intellectual and
| physical talents on the pursuit and satisfaction of short term
| audiovisual novelty, but I will do so in guilt damnit!
| soared wrote:
| Are you trying to say it's harder to inherit wealth than it is
| to be born low income, grind a construction job, and come home
| to the house your parents bought 40 years ago that homes your
| grandparents, parents, and your family?
| gruez wrote:
| >Every positive comes with a negative, nothing is created
| nothing is destroyed.
|
| >Chemistry found it to be so in the physical domain, confucians
| in the spiritual domain, and accountants in the wealth domain.
|
| This is a platitude that has no bearing on reality.
| Technological advance in the past 2 centuries has increase our
| wealth and standards of living by orders of magnitude. You can
| come up with token objections about how each advancement had
| some downsides (indoor plumbing is bad because... copper mines
| pollute the environment?), but it's certainly not the case that
| "nothing is created nothing is destroyed". Technological
| advancement has created untold wealth.
| jimbohn wrote:
| If skills and knowledge matter less and less because technology
| and automation grow over time, what matters if not already
| existing wealth? Might be an hyperbole dictated by the current
| times, who knows.
| nemo44x wrote:
| When you look around at how expensive homes are in certain areas
| and continue to lose the auction because everyone else had a cash
| bid, realize a lot of people are getting a lot of money from
| their aging and dying boomer parents. Where I live nearly
| everyone had a lot of help from mom & dad.
| jarsin wrote:
| Money flowing out from the real estate sales on the coasts are
| also a big contributor.
|
| Californians have been flooding Idaho, Nevada, Utah etc. They
| buy their homes and 2 new cars then have money left over to
| invest in the markets.
| nemo44x wrote:
| Indeed. I don't think people outside the coasts realize how
| much more the large set of top earners make.
| tehjoker wrote:
| In other words the rich are an increasingly large parasite that
| is increasingly impairing the functions of real society and
| subverting it to their ends. Two oligarchs are running the
| country right now in their own interest.
| scotty79 wrote:
| I'd be more worried about a swarm of smaller, less flashy
| oligarchs that have a choke-hold over large groups of American
| population through various for-profit schemes across myriad of
| industries who influenced lawmaking for over half a century or
| more.
| BenFranklin100 wrote:
| A dirty little secret is that that over a third of Gen Z and
| Millennials get down payment help from their home-owning parents.
| In expensive cities, the percentage is even higher. When you add
| the number of parents who co-sign in order to secure the
| mortgage, the number could reach 2/3rds in expensive metros.
|
| It's the new feudalism.
|
| https://investors.redfin.com/news-events/press-releases/deta...
| betaby wrote:
| > It's the new feudalism.
|
| In a sense that basic housing now is luxury - yes.
| asdf6969 wrote:
| In the sense that there's a growing class of landed gentry
| and nobody else can buy anything. People with houses today
| will be the aristocracy in a few decades
| betaby wrote:
| > People with houses today will be the aristocracy in a few
| decades
|
| Not really. Peasants were mostly owning their houses, that
| did't make them aristocracy.
|
| I genuinely do not see how owning a 1970s-built bungalow
| translates me into the aristocracy in a few decades.
| asdf6969 wrote:
| Because you own land. It will make more money than most
| people make through employment. This is true in many
| parts of Canada over the last decade and the trend will
| probably spread
| betaby wrote:
| > Because you own land. It will make more money than most
| people make through employment.
|
| I genuinely don't follow. Yes, the bungalow sits on land
| ( enough for BBQ for 5-6 people ) and I sit inside the
| bungalow. Neither of the them make me any money. I can't
| sold them and live in the stratosphere. I either have to
| buy something else or rent.
| asdf6969 wrote:
| You're just not living in a HCOL area yet. Eventually we
| all will. After that it will make sense
| mattigames wrote:
| I like how they always forget to mention the elephant in the
| room, 8 billion in absurd amount of any living organism, by many
| estimates we already surpassed the number of rats in the world,
| but the responses about doing anything at all to reduce that
| number in the long-term are all emotionally charged and empty of
| any rational thought.
|
| In the context of capitalism as we known scarcity increases
| value, such thing is true for number of employees available, the
| less employable people around the higher the wages and therefore
| the quality of life of the living.
| scotty79 wrote:
| Human population will decrease thanks to miracles of education
| and contraception. Give it a few centuries.
| mattigames wrote:
| I'm a afraid it will be a bit too late.
| femto wrote:
| As predicted in Piketty's book "Capital in the Twenty-First
| Century". He posited that wealth trumps labour and the post-war
| period was an anomaly. His proposed solution is a wealth tax. I
| can't see those with wealth/power implementing a wealth tax, so
| the alternative is to invest to accumulate wealth and know that
| your children, who are not in a position to invest, will probably
| be relying on that wealth.
| adverbly wrote:
| I'd prefer a land value tax personally.
|
| Capital flight is a thing. Land isn't going anywhere.
|
| Economists including multiple Nobel laureates on both the left
| and right have been screaming for land value tax for almost a
| century for this and many other reasons.
| steezeburger wrote:
| Same. I've been somewhat Georgist pilled lately.
| zemvpferreira wrote:
| Likewise. It's effectively like a wealth tax with better
| incentives.
| MarcelOlsz wrote:
| Is it basically saying to tax land that has productive
| assets? Like if you have land that has a factory, you're
| paying taxes, but if you have land with a house, you're
| not?
| Waterluvian wrote:
| I believe LVT is the opposite. Tax land ignoring what's
| on it. If you own land with tremendous potential but
| don't improve it, that's your loss.
|
| Otherwise by taxing land based on what's on it, it
| negatively incentivizes improving it. The nicer my home
| gets, the more my taxes go up.
| MarcelOlsz wrote:
| I was thinking it makes sense to tax land with productive
| assets and don't tax those without. Housing is not a
| productive asset so it shouldn't matter how much you fix
| it up. If you tax productive land there shouldn't be an
| incentive to not do anything as there would be nowhere to
| "escape" to that has a greener financial pasture. The
| problem I see with this route is the tax payers with
| productive land will start making a case for them being
| the only ones who should vote.
| mercutio2 wrote:
| The tricky thing is it's taxing land on what your
| _neighbors_ built in their land.
|
| If you build something that makes my land valuable, I get
| taxed more.
|
| I like the incentive structure, but I think part of the
| incentives are towards collectivization so you and I
| become one unit, which may or may not be a good thing.
| Waterluvian wrote:
| I think it's probably good but I definitely agree that
| it's not an obvious one and is worthy of debate.
| mcmoor wrote:
| Yeah one problem I still haven't seen solved is that when
| you build improvements on both neighbouring land, taxes
| on both of those lands will increase. It seems unfair for
| big developers who essentially built their own cities.
| I've heard something about rent system where the tax is
| frozen for 99 years, but this seems like an obvious rule
| patch that'll make LVT loses what makes it unique and
| relevant.
| AutistiCoder wrote:
| except that capital flight usually takes place in the form of
| exchanging one asset for another (stocks for crypto or money,
| for example), an event that is subject to taxation (in the US
| at least) if a profit is realized.
| TeaBrain wrote:
| >except that capital flight usually takes place in the form
| of exchanging one asset for another (stocks for crypto or
| money, for example)
|
| What led you to this bizarre idea that capital flight
| entails a person selling or exchanging all of their
| securities?
| danielmarkbruce wrote:
| The big problem with a land tax is that you'd have
| billionaires paying little tax. One may reasonably counter
| that that's fine if they aren't actually consuming much and
| it's probably correct. The majority of society won't go for
| it though.
| mercutio2 wrote:
| What is this obsession people have with the taxation of
| billionaires?
|
| There aren't many billionaires. Expropriating all their
| wealth wouldn't move the needle for any of our budgetary
| problems.
|
| I'm all for closing the step up in basis on death, which is
| what allows billionaires (and of course only moderately
| rich folks) to avoid paying much tax over their full life
| cycle.
|
| But LVT is a good idea, regardless of whether billionaires
| get some extra punishment for having the temerity to create
| successful businesses.
| danielmarkbruce wrote:
| I'm with you. But that means little. Society has a warped
| view of "fair" an always has. Any tax idea that you want
| to put in practice has to account for it. Else you may as
| well be counting horse teeth.
| eli_gottlieb wrote:
| > The big problem with a land tax is that you'd have
| billionaires paying little tax.
|
| I don't think so. Billionaires consume quite a lot of real-
| estate, even if indirectly through their business
| enterprises. Consider the Google campus in Mountain View or
| the Microsoft one in Redmond.
| danielmarkbruce wrote:
| Take the average person and how much they have tied up
| (either income or net worth wise) in their house. It's
| not even close.
| mcmoor wrote:
| I've seen some calculations that claim that LVT makes
| most people's property tax _lowers_.
| stoneman24 wrote:
| I also enjoyed the comic book version of " Capital and
| Ideology" by Picketty, Claire Alet and Benjamin Adam which
| follows the fortunes of a French family through the
| generations.
| janalsncm wrote:
| I haven't read Piketty, but another book pointing in the same
| direction is _The Meritocracy Trap_ , essentially explaining
| how non-meritocratic a lot of the economy is despite the common
| belief that it is. Wealthy parents spend a ton of resources
| developing the human capital of their children. It has
| basically eroded the middle class as a result. The author calls
| for an inheritance tax among other things.
| fumeux_fume wrote:
| Most of my friends who bought a house in Seattle in their 20s or
| 30s used inherited funds. When I worked in mortgage lending it
| was basically universal that anyone younger than 30 was getting a
| lot of help from parents. There's a massive advantage to owning a
| house when you're young, especially pre-rate hike.
| kristianp wrote:
| Just getting into a home loan pre-rate rises is the biggest
| advantage, due to the fixed-rate nature of home loans in the
| US.
|
| This article is another restating of the fact that wealth
| inequality is the greatest its ever been.
| JimmyBuckets wrote:
| https://archive.is/RKUl4
| rqtwteye wrote:
| We are building a new aristocracy where people are better than
| others just by virtue of being born into the right family. And if
| we don't limit the ability to inherit this process will just
| accelerate.
| Supermancho wrote:
| Same as it always was.
| fragmede wrote:
| Shit, I would have chosen richer parents if you'd just told me
| before I was born.
| lanthissa wrote:
| In a stable society where you dont tax wealth, this is the
| inevitable outcome.
| betaby wrote:
| We do tax wealth of course. We wealth is defined as primary
| residence. No need to remind me about 'services'. Countries tax
| plebs by constantly changing the definitions of income, wealth.
| raminf wrote:
| Relevant Calvin and Hobbes:
| https://www.gocomics.com/calvinandhobbes/1991/11/29
| drivebyhooting wrote:
| What value can most US educated bring to the economy? I count
| myself included.
|
| They're not hardcore enough to do meaningful research.
|
| They're too expensive to work in factories. (And not going to
| compete with Chinese slave labor)
|
| What's left? Hard to automate or offshore labor: service, or
| menial labor.
|
| Surely you can't become wealthy that way? I just happened to
| blunder my way into tech despite subpar education.
| jpalawaga wrote:
| America is not hardcore enough to do meaningful research? huh?
| drivebyhooting wrote:
| Did you go to American high school? Most kids barely pass
| algebra 2. Even the "smart kids" can't really compete in
| college. With standard American route there's a sub 1% chance
| you can make it as a researcher in a hard science.
| asdf6969 wrote:
| That's better than a system where future janitors are still
| expected to grind math problems instead of having a
| childhood
| firstplacelast wrote:
| What? I went to an American public high school, there
| were/are plenty of kids who are very smart. 8% of my
| graduating class were in the uber-advanced honors math
| track. This is in a flyover state outside a small city.
|
| I also used to work in science, the reason there's so few
| chances to make it as a top researcher is that there is
| little opportunity. Look at jobs for a lot of life science
| majors after a BS, you will find a ton that is washing
| glassware in a lab, a complete waste of anyone with half a
| brain.
|
| There's reasons why there is little opportunity that's not
| worth exploring here, but suffice to say there are a ton of
| very smart kids in America that choose other paths. Outside
| tech and specialized physicians, nerd careers are not
| lucrative on average. With little opportunity, smart people
| end up doing banal work. Why do banal work and have a
| mediocre salary predicated on jumping through higher than
| average academic hoops? Doesn't add up for most people.
| drivebyhooting wrote:
| What's uber advanced here? I was in the calculus BC class
| and double majored in math and physics in college.
|
| My performance in the Putnam (I got a 2...) and in grad
| school are all the proof I need that I couldn't compete.
|
| BTW I was the best student in my flyover state public
| school.
| im3w1l wrote:
| I'd say the reason there is so little opportunity in
| science is that science as an instiution is terrible at
| capturing the value it creates. Thus it instead relies on
| charity of which there isn't enough.
| janalsncm wrote:
| The original question was about what value _educated_
| people can bring to the economy. You are asking about most
| people.
|
| And I reject your characterization of the capabilities of
| American students. There are plenty of incredibly bright
| ones.
| acdha wrote:
| Yes, and what you're describing is inaccurate. This is a
| meme promulgated by the for-profit education industry but
| it's based on people not comparing like cohorts. The
| American education system is huge and includes everyone, so
| if you compare averages it appears to produce worse results
| than systems which track poor/lower-performing kids out
| into vocational education, exclude kids with special needs
| or limited English proficiency, etc. but if you compare
| matching cohorts based on socio-economic status, etc. the
| results aren't bad. The trick is realizing that research
| over the last century has shown that the most accurate
| predictor for educational outcomes is the socio-economic
| stability of their parents at birth, and the United States
| has both a lot of poor people and done less to help them
| than many of our peer countries.
|
| Regarding science, there are plenty of American scientists
| who graduated from public high schools. The problem there
| is that even highly-qualified students probably aren't
| going to have a research career because the funding isn't
| there to support it - even if you look at people who
| completed graduate school that was like 1/10 even before
| the Republicans' savage cuts.
| janalsncm wrote:
| You are onto something but I would suggest a slightly different
| conclusion: that the best and brightest STEM students are
| attracted to the shiniest jobs, which right now involve
| programming computers to trade money (HFT) and teaching
| computers to do advertising (ML-backed ads). Neither of those
| are fundamentally useful.
| drivebyhooting wrote:
| Ads are waning. Due to ATT and centralization.
| chasing wrote:
| There's plenty of work for educated people. And my
| understanding is that each dollar in education spending adds
| many dollars to the overall economy, an indicator of its
| importance.
|
| What we need is wealth that's spread out more evenly so more of
| our educated (and just simply smart) people have the resources
| to apply that education in valuable ways. If you have a
| valuable education but the only way to make a living is to work
| for some tech company selling ads or writing increasingly
| sophisticated AI software then, yeah, you're being wasted.
|
| Or if the entire economy is aligned to whatever whim Elon Musk
| or Donald Trump in their most gracious overlordship feels like
| funding. The a lot of valuable people will be wasted.
| drivebyhooting wrote:
| So my point stands? Nowhere in the American economy where to
| add value?
| chasing wrote:
| I don't think there's "nowhere," but the wealth disparity
| is making it much harder than it should be.
| georgeburdell wrote:
| This is why I believe the Financial Independence movement is too
| rearward looking, if you have children. Parents now need to plan
| for the college (and graduate school) tuition and the house
| downpayments of their children, because the cost of both have
| increased by an order of magnitude in the last 50 years.
| fullshark wrote:
| I reached the same conclusion. Ultimately I do not believe my
| children will own a house unless I give them down payments.
| Ensuring your children don't start life saddled with education
| loans + ensuring they can own a house are the two biggest legs
| up you can give them going forward.
|
| The alternative is indentured servitude and variable housing
| costs keeping them impoverished forever.
| jarsin wrote:
| _A groundbreaking 20-year study conducted by wealth consultancy,
| The Williams Group, involved over 3,200 families and found that
| seven in 10 families tend to lose their fortune by the second
| generation, while nine in 10 lose it by the third generation._
|
| This study matches my anecdotal experiences. Second and third
| generations of wealth don't respect money and this manifest in
| all kinds of bad behavior that leads to wealth destruction.
| Etheryte wrote:
| This is an interesting concept that in its abstract form
| applies to far more than inheritance. For example, it's a
| pretty thoroughly studied phenomenon that if a part of an
| immigration population becomes radicalized, it's usually the
| third generation. The reasoning if I recall correctly off the
| top of my head is similar to your reasoning.
| scotty79 wrote:
| Seems like people saying "kids are dumb" for millennia, were
| actually right every time. Who knew?
| cle wrote:
| We're increasingly protecting rich folks from the consequences
| of bad investments, I wonder how much this moral hazard impacts
| mobility?
| focusgroup0 wrote:
| part of the reason marriage was invented as a social technology
| was intergenerational transfer of wealth. so, inheritance has
| been 'nearly as important' as working for millennia.
| starioIC wrote:
| What is opposing theory to this? I.e., idea that inequality bad
|
| Maybe I'm in a bubble that I seem to hear this and while I do
| agree I would still like to know what the opposing idea is here.
| bombcar wrote:
| I suppose it's something like inequality is inevitable so you
| can't remove it; instead you can try to make it comfortable for
| everyone and that due diligence can help.
|
| Perhaps a well-run military would be an example; unequal by
| definition but without all the parts working well it falls
| apart.
| UncleOxidant wrote:
| https://archive.is/M5kId
| asdf6969 wrote:
| Almost everyone I know got several hundred thousand dollars
| gifted for a down payment and most of these people are from
| typical middle or upper middle class backgrounds. I have a top 2%
| income (by Canadian standards) but the best I can do is a 2
| bedroom condo or a bottom of the market townhouse with a long
| commute
|
| I don't know a single neighborhood in this city where the average
| household in that neighborhood makes enough to live there with
| current prices.
|
| I genuinely don't know why I even work anymore. I don't have any
| achievable financial goals except save as much as I can until I
| move away to live off my savings in a cheap area
| TriangleEdge wrote:
| I moved to the USA and got 2.5x my salary in CAD. Canada is
| fucked and I'm glad I left. I've lived in tiny apartments there
| and now I just bought my first house in an expensive city with
| 0 help from my parents. Am also starting a family here which is
| something I could have never dreamed of in Canada.
|
| I suggest you look at historical trends for USD to CAD and
| trends for home prices vs income in Canada.
| asdf6969 wrote:
| working on it :)
|
| I like it here but I have no future and it's seriously
| impacting my mental health
| MarcelOlsz wrote:
| I bought a house here on ridiculous terms (believed in my
| job at the time). Then I got let go and I've been paying
| $4k/mo ever since hahahaha. I cannot wait to sell and get
| out.
| chasely wrote:
| I see this a lot as someone that came from a solidly middle-
| class background (parents were a teacher and secretary) and
| went to a "highly-ranked" university with plenty of upper-
| middle or upper class students.
|
| I work in the same jobs as my peers, but there is a clear
| wealth difference in how our lives are spent.
|
| We have a nice house in a good neighborhood, but our peers have
| very nice houses is some of the best neighborhoods due in large
| part to down payment gifts, gifts for remodeling, etc. We can
| both afford the mortgage payment, but the down payment would
| take us probably a decade to save for.
|
| On vacations, we'll drive a couple hours away with the kids,
| while our peers will fly to Europe and spend two weeks since
| they pay for the flights and their parents pay for lodging and
| food.
|
| And then there is family support. Some of my peers have parents
| who bought second (or third) homes to be closer to their
| grandchildren, or will pay for the very nice private school,
| etc.
|
| It's taken me a lot to not very bitter about this -- and I'm
| clearly still a little bitter -- but I also know that we will
| likely be in a position to offer some of this support to our
| kids in 20+ years.
| Taylor_OD wrote:
| I've got one friend who was gifted a house when he graduated
| from college. He works a similar type of job and makes a
| similar salary to the other members of our friend group, but
| the gift of the house, given from his wealthy parents, makes
| his financial situation drastically different from the rest of
| us.
|
| I'm glad for him. But it's incredible how different one's life
| can be from their peers just based on their parent's wealth.
| leptons wrote:
| I don't have any wealthy relatives, so I'll never be so lucky
| as a lot of my friends. It's a struggle to even save up a down
| payment _to buy a car_ , as our car is pretty old now - and I
| make 200k a year. Renting a house is really the only realistic
| way I'll ever get to live in a house, at least in the expensive
| city I've lived in most of my life.
| talkingtab wrote:
| In United vs FEC, corporations were granted to the ability to be
| treated as persons - with all the rights - when it was good for
| them. And to enjoy the protections of being a corporation when
| that was good for them. This was a unilateral decision by the US
| Supreme Court.
|
| The result is that corporations now choose who candidates are in
| the US and who gets elected. Once a candidate is elected they
| serve the master who got them elected. Not, We the people. Any
| even casual evaluation of the laws passed confirms this.
| Affordable medical care, which the People want and need? No.
| Obscene profits from corporations overcharging people for medical
| care? Great!
|
| Regular people push addictive drugs? Jail. The Sackler Family,
| probably the biggest cause of drug overdoes deaths ever? Are they
| in jail? And what about the millions of stock owners who made a
| tidy sum? Did they lose their money, are they in jail? Nope.
|
| We are not a democracy, we are a corpocracy. Because of a US
| Supreme Court decision. We need to fix this. And hint: is the
| word corporation in the US Constitution. Hint #2 does the 14th
| amendment prohibit unequal protection under the law.
|
| In a democracy the representatives represent the will of the
| people. In a corpocracy they represent the will of the wealthy
| corpocrats and corporations. We have two corpocratic parties to
| choose from. Democrats and Republicans.
|
| We need to fix this.
| boelboel wrote:
| Housing is the obvious problem, only way to fix this is by making
| it easier to build houses and some kinda land value tax (higher
| property taxes would work but not as well). Problem is most
| western countries are gerontocracies and property taxes are the
| most hated tax. If you didn't get lucky you might as well give up
| on ever owning a house.
| fsckboy wrote:
| > _People in advanced economies stand to inherit around $6trn
| this year--about 10% of GDP_
|
| this is mixing apples and oranges. Let's say the stock market
| yields 10% annual returns on average (it doesn't, but it's a
| round number in the ballpark). Let's say you inherit a million
| dollars. That million dollars invested in the stock market would
| return $100,000 to you as annual income. THAT number is
| comparable to GDP which is a measure of _income_. So, in other
| words, "people in advanced economies stand to earn annually from
| their inheritances less than 1% of GDP (yawn) not 10%"
|
| other nits, the baby boomers were an unusually large population
| group in an unusually prosperous and healthy period of history:
| we've known they would die for quite some time and we've known
| they would leave a lot of money. It's not "a trend" and it's not
| "news". It's a well known anomoly, a blip/bulge passing through
| the system. It's interesting but it's not alarming.
| gruez wrote:
| >this is mixing apples and oranges. Let's say the stock market
| yields 10% annual returns on average (it doesn't, but it's a
| round number in the ballpark). Let's say you inherit a million
| dollars. That million dollars invested in the stock market
| would return $100,000 to you as annual income. THAT number is
| comparable to GDP which is a measure of income. So, in other
| words, "people in advanced economies stand to earn annually
| from their inheritances less than 1% of GDP (yawn) not 10%"
|
| I get where you're trying to go with this (ie. "you can't
| compare stock vs flows!"), but you've patterned matched too
| aggressively. There's nothing wrong with using GDP of a country
| as a benchmark. Sure, it's comparing stock vs flows, but GDP of
| a country is nonetheless a valuable yardstick when comparing
| sums, for instance comparing debt to GDP levels. As long as
| they're not directly comparing the figures (eg. implying that
| the whole country is going to be inherited in 10 years time or
| whatever), it's fine.
| encoderer wrote:
| As long as most millionaires are self-made, we are ok.
|
| My dad worked at a gas station and I run a tech company.
| guywithahat wrote:
| This doesn't hold up logically. To inherit money means the
| generation before you saved it, but for it to be generational
| wealth you must then pass on more than you inherited. Further it
| doesn't serve as a major investment, because your parents only
| die ~25 years before you do, meaning it can't be used to start a
| business or something similar.
|
| For inheriting wealth to be important to your success, it would
| either have to come much sooner or you would have to have no kids
| of your own
| gruez wrote:
| >but for it to be generational wealth you must then pass on
| more than you inherited. Further it doesn't serve as a major
| investment, because your parents only die ~25 years before you
| do, meaning it can't be used to start a business or something
| similar.
|
| At least in theory that's not hard to pull off. From the
| article:
|
| >By one calculation, if America's rich families in 1900 had
| invested passively in the stockmarket, spent 2% of their wealth
| each year and had the usual number of children, there would be
| about 16,000 old-money billionaires in America today. In fact,
| there are fewer than 1,000 billionaires and the vast majority
| of them are self-made.
|
| The average inheritor might be too spendthrift to stick to the
| plan, it's not exactly impossible as you suggest.
| DrNosferatu wrote:
| The Economist agreeing with Piketty???
|
| The world has truly gone mad!
| DrNosferatu wrote:
| So wealth wasn't all merit then?
|
| Who would say...
| cco wrote:
| If I've said it once I've said it a thousand times, there is no
| cogent and respectable argument for why income from labor is
| taxed at a higher rate than income from capital.
|
| I hope we start there, a very simple and straightforward action
| to take.
| xdavidliu wrote:
| my guess is because capital has more options than labor, and
| the decision makers since time immemorial are more afraid of
| capital leaving than labor leaving
| myflash13 wrote:
| Why should income from labor be taxed at all? Income taxes
| strike me as fundamentally wrong.
| digdugdirk wrote:
| What is your preferred alternative to fund basic common
| services required for a modern society?
|
| And what are the pros/cons and outcomes of your preferred
| alternative?
| myflash13 wrote:
| Do you know what happens to your income tax when you pay it
| to the government? They destroy it (if it's cash), or
| simplify nullify electronic values. The government
| literally prints money, it doesn't need your taxes to
| "make" money. Income taxes were invented before the
| creation of fiat (non-gold backed) currency.
|
| Lots of countries in the world operate without income
| taxes.
| trial3 wrote:
| > Lots of countries in the world operate without income
| taxes.
|
| Okay, but "lots" feels untrue and saying "operate" is
| borderline deceptive - there are 21 that I can find from
| a random infographic [0]. Human rights superstars like
| the UAE, NK, Brunei, and Saudi Arabia; above-board
| corporate havens like the Cayman Islands; and places I
| can't come up with a quippy joke about like Monaco or
| Vatican City.
|
| I'm no geopolitics expert, but it looks like one thing
| that "functional sovereign states meaningfully
| participating in the world stage without oil money or
| some clear outside source of capital" all have in common
| is income taxes.
|
| [0] https://www.visualcapitalist.com/charted-a-handy-
| list-of-cou...
| KolmogorovComp wrote:
| > Lots of countries in the world operate without income
| taxes.
|
| Can you give some examples? Do you think you live better
| in those countries than those with taxes?
| myflash13 wrote:
| Monaco is one of the nicest places on earth. Lots of
| wealthy people go there to retire or just live.
| gabesullice wrote:
| The government of Florida operates with no income tax.
| Its GDP is comparable to Spain and its population sits
| between Chile and Australia.
|
| Less than one fifth of its revenue comes from federal
| sources. If its residents weren't paying federal income
| taxes, Florida could probably afford to increase its
| taxes to cover the difference.
|
| In the US, local taxes--not federal taxes--pay for the
| majority of surface street maintenance, schools,
| emergency services, licensing regimes, health and safety
| inspections, unemployment insurance, etc. I.e., most of
| what one considers to be staples of the social contract
| in a well-administered society.
|
| It seems as though you're implying income taxes are a
| prerequisite to some standard of living comparable to the
| US, but that presupposes that income taxes in the US
| actually pay for the things that make a place worth
| living in.
|
| If all of those staples are paid for by local
| governments, then what _do_ federal income taxes pay for?
| Retirees and military procurement, for the most part.
|
| Can you imagine other ways to raise those funds?
| freddie_mercury wrote:
| > Less than one fifth of its revenue comes from federal
| sources
|
| Over one-quarter (26%) comes from Federal sources
| according to the Census Bureau's Annual Survey of State
| and Local Government Finances.
|
| Having 26% of your government funded by (Federal) income
| taxes sure sounds like Florida can't operate without
| income taxes. They simply outsource collection to another
| jurisdiction.
| meowkit wrote:
| A Land Value Tax
|
| https://www.google.com/search?q=is%20land%20a%20big%20deal&
| i...
| pulkitsh1234 wrote:
| just tax the bussiness's income, don't tax a human's
| income?
| eli_gottlieb wrote:
| Labor is a near-universal ingredient for economic activity.
| If you refuse to tax anything with a labor component, you run
| out of things to tax at all.
| adammarples wrote:
| Land value. Inheritance. Rental income. Dividend income.
| Capital gains. Sales. Resource extraction. Etc
| eli_gottlieb wrote:
| The noncogent and unrespectable argument is that labor is less
| liquid and more difficult to move around for tax-dodging
| purposes than capital. States have been reduced to opportunists
| in the realm of taxation and tax enforcement.
| adammarples wrote:
| The very often stated argument is that labour is risk free,
| while putting your own capital up to start a business is risky.
| apwell23 wrote:
| I suddenly became the poor person in my peer group that all went
| to same school and did similar jobs. Why? because they all got
| 'help' buying a home and now have a fancy homes. I live in a
| rental apartment. I am still the most judicious about spending
| money but its hard to hang out with a ppl who can afford to be
| more careless.
|
| It all happened so fast in 2022.
| pjdemers wrote:
| From the article: "Building enough houses in the right place is
| the single biggest action governments can take to restore the
| link between work and wealth" No greater truth can can be spoken
| about what's wrong with the economy in rich countries today.
| hn_throwaway_99 wrote:
| I think Austin, TX is just a great proof point for this over
| the past 5 or so years. We built a _ton_ of housing over the
| past 5 years, and last I read rents have fallen 22% and house
| prices have also gone down considerably (though they were so
| insane during the pandemic I still think they 've got a way to
| go).
|
| I may consider myself liberal, but general housing policy by
| most liberal leaders has been a total disaster and should be
| recognized as such.
| pinkmuffinere wrote:
| Looking at the Case-Shiller index for Austin[1], Dallas[2],
| NYC[3], SF[4], and LA[5], it doesn't seem like Austin's
| prices have grown any less in the last five years. They've
| basically all nearly doubled in that time. If there is any
| improvement it's too small for my eyes to see. In fact, SF
| seems to have had the lowest price growth (perhaps due to
| fears about crime?).
|
| [1] https://fred.stlouisfed.org/series/ATNHPIUS12420Q
|
| [2] https://fred.stlouisfed.org/series/DAXRNSA
|
| [3] https://fred.stlouisfed.org/series/NYXRSA
|
| [4] https://fred.stlouisfed.org/series/SFXRSA
|
| [5] https://fred.stlouisfed.org/series/LXXRSA
| kjkjadksj wrote:
| I'd wager sf had the lowest price growth due to having the
| lowest job growth in that time more than anything.
| Nimitz14 wrote:
| NYC keeps going up while Austin has clearly reversed the
| upward trend. It seems you may have not looked at the
| graphs you linked.
| pinkmuffinere wrote:
| You're reading a lot into the wobbles in the plot, when
| you probably want to be looking at the total change over
| the last 5 years. Here's the change by city, Q4 2019 - Q4
| 2024:
|
| Austin: 346 -> 510. 510/346 = 1.47
|
| Dallas: 192-> 295. 295/192= 1.53
|
| NYC: 203-> 318. 510/346 = 1.56
|
| SF: 271-> 361. 510/346 = 1.33
|
| LA: 291-> 443. 510/346 = 1.52
|
| These numbers are all pretty close imo, clustered around
| 50% growth in the last 5 years. Austin in particular grew
| 47% over the last 5 years, for a annualized growth rate
| of ~8% -- that is some _crazy_ growth for real estate,
| when the long term average in the US is about 3%
| annualized. IMO SF is the only remarkable datapoint, with
| 33% growth -> ~6% annualized growth. Even that is still
| high though.
|
| It would be easier to visualize if we can plot them all
| on top of each other, but I didn't find an easy way to do
| that.
| Nimitz14 wrote:
| You're looking at the start and the end of the plots and
| totally ignoring what happens in between. If Austin had
| followed the linear trendline from Q4 2019 to Q2 2022
| (increase of 22.7/Q) then it would have been at 800 in Q4
| 2024.
|
| 800/346=2.3
|
| 2.3 >> 1.47
|
| That's not a wobble in the plot.
| em500 wrote:
| The problem with such calculations is that they're very
| sensitive to the chosen starting point: compare the
| growths in the most recent 3 instead of 5 years:
|
| Austin: 502-> 510 growth: 1.6%
|
| Dallas: 263-> 295 growth: 12.2%
|
| NYC: 255-> 318 growth: 24.7%
|
| SF: 349-> 361 growth: 3.4%
|
| LA: 384-> 443 growth: 15.4%
| pinkmuffinere wrote:
| If we're looking for a trend that follows a specific city
| instead of specific year and city, then I agree. For that
| purpose I think I'd like to run this same calculation for
| the 5 year interval 2019-2024, and 2018-2023, and
| 2017-2022, etc, to see if there is a trend that is unique
| to the cities, as opposed to the cities in a certain
| year.
|
| However, my interpretation of the original claim about
| Austin is "Austin house prices have grown less in the
| last 5 years than other places". That claim is pretty
| specific, and can be examined by looking at just the
| start and end points. Looking at the end points, it seems
| incorrect.
| pinkmuffinere wrote:
| I can't edit this comment, so instead I'm replying.
|
| >They've basically all nearly doubled in that time
|
| This statement is incorrect. In another comment I did the
| math, and most of them had about 50% growth in the last 5
| years, with SF being the outlier with 33% growth. Sorry for
| the mistake, my eyeballs are not as good as my math.
| kjkjadksj wrote:
| I don't understand how rents actually go down in a market. My
| landlord has raised rent every year save for when covid laws
| prevented that. It is their incentive to always raise rent
| even when articles about my city claim "rents went down 5%"
| or whatever this past year. Whose rent? Expensive commercial
| landlord new construction rents where they try and hide the
| price anyhow with two months free on the first year? The rent
| that therefore only matters for the bank to put a valuation
| on that property because people move in year 2 at these sort
| of properties to avoid paying that full rent? Maybe that is
| what they are referring to. No one I know has ever had a call
| from their landlord telling them to pay less money next month
| due to the declining value of their asset.
| erikerikson wrote:
| We reduced rent during COVID both for a present tenant and
| for the following tenant. Generally those statistics are
| across all units while individual experiences can be wildly
| different.
|
| [Edit] FWIW that was based on the rental market rather than
| anything related to asset value.
| iknowSFR wrote:
| SFR had no decreases during those years in the US.
| Markets like the Southeast had 7-14% increases every
| year. SFR companies were doing "cash for keys" because
| rates were increasing so quickly that it was better
| business to buyout a lease from the current tenant and
| bring in a new one at a 14% increase.
| erikerikson wrote:
| It's not clear what you're trying to say. The GP said
| they weren't sure how rents went down. As an at-the-time-
| I-referenced landlord we reduced rents. Or tenants may
| have been privileged people who didn't need it but it
| seemed like the right thing at the time. Mostly because
| the impartial rent statistics source we repeatedly used
| indicated rents had gone down for the market local to the
| unit we offered. Maybe this is why we got out, because we
| weren't practicing exuberant total maximization of what
| we could extract. We got in because my partner was
| sentimental about the unit and felt we could hold aside a
| small part of the market to be a little kinder and more
| human. What triggered us getting out, in fact, was
| hostile policy enacted by Seattle that frequently
| poisoned the relationships with our tenants. That is,
| with the same behaviors we began being treated very
| poorly. I'm off the opinion that Sawant was in the pocket
| of large corporate holders given what I understand of the
| effectiveness with which she had consolidated the Seattle
| rental markets into a smaller set of hands.
| freddie_mercury wrote:
| The landlord reduces the rent when a tenant moves out and
| they can't find a new tenant at the previous rate quickly
| enough.
|
| This happens all the time.
|
| Rents aren't based on the value of the asset. They are
| based on supply and demand in the rental market.
| seanmcdirmid wrote:
| > We built a ton of housing over the past 5 years, and last I
| read rents have fallen 22% and house prices have also gone
| down considerably
|
| You mean 22% in the last year? Definitely not 22% compared to
| 5 years ago.
| ForTheKidz wrote:
| > I may consider myself liberal, but general housing policy
| by most liberal leaders has been a total disaster and should
| be recognized as such.
|
| ? Private development is the heart of liberalism. We haven't
| had anyone but liberal leadership since, like, LBJ I think?
| And he was also a liberal acting out of character. Any
| alternative would surely imply public investment in housing.
| No, re-zoning is not going to make a dent in homelessness.
|
| I'm aware that you're referring to liberal in the sense of
| "loyalist democrat" or whatever, but the reality is that both
| parties have virtually the same policy when it comes to
| housing: blame the market, act as though the market will
| still answer our problems even though it hasn't in the past,
| and feign helplessness that the government can directly
| influence housing in the first place outside of zoning. I.e.,
| liberalism.
| BurningFrog wrote:
| It's simpler than that. Government just has to _legalize_
| building housing, and the people will make it happen.
| dragonwriter wrote:
| "The people" (local voters in the places that have the lomits
| in place) are the ones who want rules against building
| housing, not some external-to-the-people government.
| kjkjadksj wrote:
| This is what the internet urbanists don't get. Government
| is a mirror on its electorate. You want urbanist principles
| it starts by educating this electorate directly, not
| waiting for the government to do something to get itself
| unseated by that angry electorate the next cycle.
| dragonwriter wrote:
| Well, or you change the level of government you target to
| one whose constituency is less invested in the policies
| causing the problem and more concerned with solving the
| problem, e.g., over the last several years the California
| State government restricting the practical ability of
| local governments to restrict housing.
| BurningFrog wrote:
| Is that meant as a counter argument?
|
| Even if a majority would vote for a construction ban, many
| people would build new housing if it was legal. Both people
| who would vote against and for a ban.
| sambull wrote:
| Always has been.. that's why churches have old ladies and
| community to poach lonely old peoples stuff. Also Psychics love
| your dead husbands boat.
| aczerepinski wrote:
| Taxing estates over 1B at 100% would move the needle a good
| amount. Rich people will insist that if you remove their
| incentive to earn more than a billion they'll stop working and
| I'm ok with that. There will always be plenty of non billionaires
| left to pick uo the slack.
| jfengel wrote:
| Make it 99%. Then they will increase their wealth by $.01 for
| every dollar earned, which is better than $.00 for doing
| nothing. Logically they must continue using their special
| billionaire-skills because they are earning money for it.
| Probably at a faster rate than 99% of us.
|
| Plain economics. Surely they will make the rational choice.
| BJones12 wrote:
| The rational choice would then be to move their economic
| activity and the jobs involved to another country with lower
| taxes.
| thfuran wrote:
| The US taxes non-resident citizens.
| erikerikson wrote:
| And citizens can abandon their citizenship if they feel
| it is worth it.
| jfengel wrote:
| If they think that they can be as economically productive
| in a different country without American citizenship, then
| they should indeed do that.
| luckylion wrote:
| That would already be the rational choice, if it was. There
| are countries with lower taxes, yet the economic activity
| isn't flocking to them.
| SvenL wrote:
| I think it would better to let them renovate/build public goods
| like schools/libraries/streets etc. If they pay taxes I don't
| think it would help society. It would require politicians which
| don't use tax money to improve their wealth on their own (I
| know they would be taxed too but then the money is just moving
| on paper and not really used).
| seydor wrote:
| There is a weapon that younger generations have virtually
| forgotten, but we re likely to see it making a big comeback in
| the short term: strikes.
| chasing wrote:
| People don't seem to realize that the alternative to a
| democratic, egalitarian society is a violent one. For rich and
| poor alike.
|
| People will strive to make their lives better. If that effort can
| be funneled into productive actions that provide benefits to
| society as a whole, then that's what people will do. If that
| effort requires stealing from and killing hoarders of wealth
| because there's no other way to get resources, then that's what
| people will do.
|
| The hyper-wealthy seem oblivious to the fact that you can't both
| be a trillionaire that's causing societal economic desperation
| _and_ live in a society where people politely do their business
| and leave you in peace.
| Vegenoid wrote:
| We have lived in a stable system long enough for people to
| forget the horrors of instability. It is a certainty that a
| reminder is coming - what is uncertain is how far away it is.
| hnthrowaway0315 wrote:
| If working is still a little more important than inheritance, it
| marks the advancement of the human civilization.
|
| In the country where I was born, inheritance was way more
| important than working 100 years ago.
| quantadev wrote:
| The American economy can be explained very simply: We went broke
| in 1970, and so we went off the Gold Standard, got the world to
| agree to use USD as reserve currency, and then just started
| printing money on an as-needed basis to fund gov't spending, and
| also for banks to hand out [basically] freely to investors, which
| pumped up the stock market (and all other assets) USD valuation
| to crazy insane levels.
|
| All this free money also caused inflation and so everyone holding
| assets saw those USD valuations rise accordingly. Basically the
| baby boomers indebted the nation by stealing $36T from all future
| generations, and every one of them will all be long dead before
| one nickle of this debt is paid down, if it ever is, and no one
| even thinks it ever will be.
| neycoda wrote:
| I can't wait until the rich start inbreeding so much they get
| deformed.
___________________________________________________________________
(page generated 2025-03-01 23:01 UTC)