"It’s Time for Major Wealth Redistribution — Yes, I Mean It."

[Loren Pechtel]

The presence of one poor person in a society of wealth and plenty is a poor reflection on that society and values. Where, from a position of plenty, they cannot seem bring themselves to help lift someone left behind.

It depends on why they have been left behind.

Help them, yes, but if they can walk you don't carry them.

 

[Loren Pechtel]

You like visualization aids? Here's one:

Interesting graph, but without links to specific date, it's almost useless. It appears to be cherry-picked. A graph showing hunger might be more useful than cherry-picking a particular dollar figure. The presentation tells us nothing of wealth and income inequality, which is the topic of this debate.

When comparisons are made between 1800 and the present, it must be remembered that productivity has increased by a factor of about 15 or 20 times in the U.K. over that interval. (No, I didn't "cherry-pick" U.K. — it's just a country where data is readily available.) All else equal this would imply inflation-adjusted $2 changing into $30 or $40; yet your graph considered only $2 throughout.

Income inequality proves nothing about whether someone is in poverty.

You have a group of millionaires, if Warren Buffet walks into the room are they suddenly in poverty??

As for that graph--note that it's in adjusted dollars, it's a legitimate increase.

It's the result of jobs being outsourced to the developing world and the communist nutcases getting their act together and letting their economy grow.

 

[Loren Pechtel]

People don't necessarily make poor or self destructive choices because they know their choices are poor or self destructive. Something may be wrong mentally, socially, poor education, inability to reason clearly, etc, etc.

Does society just say "fuck them, they made their bed, let them lie in it" or does it try to remedy the problem? What kind of a society do we want?

So you want an absolute dictatorship where we force everyone to behave in the accepted manner?

You can't have freedom without the freedom to make bad choices.

 

[DBT]

People don't necessarily make poor or self destructive choices because they know their choices are poor or self destructive. Something may be wrong mentally, socially, poor education, inability to reason clearly, etc, etc.

Does society just say "fuck them, they made their bed, let them lie in it" or does it try to remedy the problem? What kind of a society do we want?

So you want an absolute dictatorship where we force everyone to behave in the accepted manner?

You can't have freedom without the freedom to make bad choices.

That's not what I said or implied. Social security networks and available aid are not the signs of Dictatorship, just a decent society. The children of the very rich offer a safety net in the form of family wealth and presumably care. Should society at large not do the same for its struggling members?

Do you consider the super rich to be radicals, communists or something because they take care of their own when needed, endowments, trust funds, etc?

 

[Toni]

The presence of one poor person in a society of wealth and plenty is a poor reflection on that society and values. Where, from a position of plenty, they cannot seem bring themselves to help lift someone left behind.

I don't entirely agree with you.

Some people really are in poverty because they make poor, self destructive choices. IMO, any decent society allows for its people to have free will to make poor, even horrible, self destructive choices. An alcoholic CEO who refuses to get help and eventually loses his/her position, family, home, etc. should be free to make such horrible decisions---and to suffer the consequences of those terrible decisions. AND also should be provided the help they need in order to regain their sobriety and hopefully work their way out of poverty if that's their desire. For one example. I think we will always have addicts, thieves and other criminals. I think we need to treat them all as though they can make better choices, conquer their addictions and live a more stable life, including more economically stable life. I do not think that society should enable addicts to continue their self destructive and destructive behavior (It's rare that an addict's addiction only directly harms the addict.)

Some people are in poverty because of positive choices they make to live simply, without much in the way of possessions or income.

What I believe is incumbent upon any decent society is that the legal rights of those who are in poverty are not less than the legal rights of those of more means, including those with extreme wealth. Laws should apply equally to billionaires and the homeless.

I also believe that any decent society should provide for all the best possible health care, access to decent and affordable housing (even if affordable means at no cost to the resident) and food, access to the best possible education, clean air and water, basic safety from crime and protection/help in the case of natural disasters or other events that cause people to tumble from stability into precarious positions.

We've got a long ways to go.

People don't necessarily make poor or self destructive choices because they know their choices are poor or self destructive. Something may be wrong mentally, socially, poor education, inability to reason clearly, etc, etc.

Does society just say "fuck them, they made their bed, let them lie in it" or does it try to remedy the problem? What kind of a society do we want?

Clearly people sometimes, perhaps often make poor choices because they struggle with mental illness, addiction, sometimes lack of education, sometimes disability. But--take the example of addicts. Addiction is not a choice but continuing to use is a choice and it's a choice that does not just affect the addict but also has profound negative consequences for all who are involved with the addict. And overcoming the compulsion to abuse (whichever) is something that the addict must choose to do for themselves. Society and friends/family(assuming they have not been driven away) can support but one cannot compel an addict to clean their act up and to remain clean. Indeed, many/most addicts relapse multiple times before it 'sticks.' If it ever does. Typically, such people will be poor, will lack reliable housing, reliable transportation, jobs, income, etc. Yes, addiction is an illness but there is a choice to be made or not- to get treatment and get your life under control.

There are people who have a variety of illnesses and/or disabilities which dramatically impair their ability to earn a decent living. Some can, with appropriate support, education, training, perhaps be able to become self supporting but some cannot and will never be able to be. They will be poor and dependent upon friends, family, society to fulfill their needs.

Some people are quite happy or at least content to never have much: no permanent address, not much in the way of possessions or cash. I don't think society can or should compel them to live a different way in order that we might claim that 'we have irradicated poverty.'

I believe that everyone in society deserves a fair shot--multiple fair shots--at a decent life. I believe that even the biggest fuck up amongst us deserves to be treated fairly under the law and under the law should have the same rights and protections as a billionaire.

 

[Swammerdami]

... inflation-adjusted $2 ...

It says right in the middle of the graph that it's inflation adjusted.

??? ???
Try reading for comprehension.

I even spelled out "inflation-adjusted" in the post you quoted, hoping it would jog unwary readers. I guess I should have spelled things out in 3rd-grade-level detail.

Adjusting for inflation is NOT the same as adjusting for population, and certainly is NOT the same as adjusting for productivity.
Start a new thread if you're unfamiliar with economic concepts as basic as productivity.

 

[Loren Pechtel]

People don't necessarily make poor or self destructive choices because they know their choices are poor or self destructive. Something may be wrong mentally, socially, poor education, inability to reason clearly, etc, etc.

Does society just say "fuck them, they made their bed, let them lie in it" or does it try to remedy the problem? What kind of a society do we want?

So you want an absolute dictatorship where we force everyone to behave in the accepted manner?

You can't have freedom without the freedom to make bad choices.

That's not what I said or implied. Social security networks and available aid are not the signs of Dictatorship, just a decent society. The children of the very rich offer a safety net in the form of family wealth and presumably care. Should society at large not do the same for its struggling members?

Do you consider the super rich to be radicals, communists or something because they take care of their own when needed, endowments, trust funds, etc?

The problem with your approach is you assume everyone wants to succeed, not merely be a bum on whatever welfare system exists.

 

[Loren Pechtel]

... inflation-adjusted $2 ...

It says right in the middle of the graph that it's inflation adjusted.

??? ???
Try reading for comprehension.

I even spelled out "inflation-adjusted" in the post you quoted, hoping it would jog unwary readers. I guess I should have spelled things out in 3rd-grade-level detail.

Adjusting for inflation is NOT the same as adjusting for population, and certainly is NOT the same as adjusting for productivity.
Start a new thread if you're unfamiliar with economic concepts as basic as productivity.

Adjusting for productivity is only relevant if you care about inequality rather than poverty. If you care about poverty it's the absolute number that matters.

 

[DBT]

That's not what I said or implied. Social security networks and available aid are not the signs of Dictatorship, just a decent society. The children of the very rich offer a safety net in the form of family wealth and presumably care. Should society at large not do the same for its struggling members?

Do you consider the super rich to be radicals, communists or something because they take care of their own when needed, endowments, trust funds, etc?

The problem with your approach is you assume everyone wants to succeed, not merely be a bum on whatever welfare system exists.

Do you believe that people choose to be poor? That they deliberately choose to be 'bums?' What percentage do you think? Most of the poor? Half the poor? Quarter?

And what about the working poor, those who work hard, work long hours for little pay? Are they bums?

 

[steve_bank]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

 

[DBT]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

I think it's a convenient fiction that the rich and their defenders like to trot out in defence of their own excessive wealth or the aspirations of wannabes.....a rationale.

 

[Toni]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

I did not enjoy being poor. I was fortunate---truly fortunate--that I was able to change my status.

I've known a lot of people who have been far less fortunate. The stress of being poor, the expense(!) of being poor is overwhelming. Small, small errors in judgment, often driven by desperation of trying to satisfy competing needs can lead to disaster that traps people forever. I've seen it happen with intelligent, hardworking and well educated people, not just people with little education or access to education.

 

[Loren Pechtel]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

No. It's that they are looking at a short time horizon--they won't put in the effort now for future reward.

 

[DBT]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

No. It's that they are looking at a short time horizon--they won't put in the effort now for future reward.

Oh, come on, do you really believe it's so simple?

 

[bilby]

That's not what I said or implied. Social security networks and available aid are not the signs of Dictatorship, just a decent society. The children of the very rich offer a safety net in the form of family wealth and presumably care. Should society at large not do the same for its struggling members?

Do you consider the super rich to be radicals, communists or something because they take care of their own when needed, endowments, trust funds, etc?

The problem with your approach is you assume everyone wants to succeed, not merely be a bum on whatever welfare system exists.

The problem with your approach is that you assume that people being a bum on whatever welfare system exists is a bad thing - but only for a very specific type of 'bum'.

The reality is that in the developed world the vast majority of people at any given time are NOT engaged in paid employment. So you are worried about adding a trivial number of additional unproductive people to a society that already supports huge numbers of such people.

Most people, given (for example) $600/wk free, gratis and for nothing (that's equal to 40 hours at a proposed $15 minimum wage), would NOT decide that this was heaven on Earth, and simply stop bothering to do anything that might generate any further income.

Sure, a handful might; And good luck to them if they want to live at that level, and have no aspirations to anything more.

But realistically, most people would not.

Would you? Seriously?

So providing that amount for nothing would have very little impact on the number of people looking for a job. It would, however, have a massive impact on employers who treat their employees like shit, if those employees could say "I quit", without risking starvation and homelessness. That's not a bad thing. At all.

 

[Swammerdami]

Adjusting for productivity is only relevant if you care about inequality rather than poverty. If you care about poverty it's the absolute number that matters.

This is much MUCH too simplistic. Rich people in medieval Europe lacked access to simple luxuries like hot water and flush toilets, let alone penicillin. Do you think one of these Dukes or Earls would be happy to trade places with one of today's poor in America? Or, to reverse the question, do you think a poor person today who can't afford a prescription for antibiotics should be told "Relax! You're no worse off than the rich a century ago: they couldn't buy antibiotics either."?

To divert discussion of "inequality" to "absolute poverty" is a right-wing trick. Income is a strong predictor of contentment but the correlation is far from perfect; and, understandably, inequality is inversely correlated with contentment. The World Value Survey shows the percentage of self-reporting "happy" people to be much higher in Brazil than in eastern Germany (despite the huge income boost there in recent decades). There is no easy equation for contentment, contrary to the glib right-wing meme that all people need is a full belly. BTW, the U.S. ranks below Costa Rica in the U.N. "World Happiness Report."

In an encounter with police it is probably much better to be a middle-class person in a poor country than a lower-class person in the U.S., even though the latter may be better off measured strictly by dollars.

And of course the U.S., which once prided itself on income-class mobility, now ranks below other developed countries by that measure.

 

[laughing dog]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

No. It's that they are looking at a short time horizon--they won't put in the effort now for future reward.

Oh, come on, do you really believe it's so simple?

Sadly, there are plenty of people who think it is that simple.

There is evidence suggesting that a UBI has, at worst, a small negative effect on labor supply and, at best, a small positive effect on labor supply. This paper https://basicincome.stanford.edu/research/papers/what-we-know-about-universal-basic-income/ - reviews the observed outcomes from UBI experiments.

 

[bilby]

Oh, come on, do you really believe it's so simple?

Sadly, there are plenty of people who think it is that simple.

There is evidence suggesting that a UBI has, at worst, a small negative effect on labor supply and, at best, a small positive effect on labor supply. This paper https://basicincome.stanford.edu/research/papers/what-we-know-about-universal-basic-income/ - reviews the observed outcomes from UBI experiments.

If you gave me a small basic income, I would certainly still want to go to work to earn more and improve my lifestyle.

Everyone I know would feel the same way.

Even the opponents of UBI would do this. But those opponents believe, against all evidence and reason, that there's a large "they" of lazy people who would be completely content to just watch TV all day in their trailers, subsisting on ramen noodles, and that this "they" is big enough and productive enough right now that the withdrawal of their labour would crash the economy.

This is directly analogous to the religious argument that, without a god, people would have nothing constraining them from becoming rapists and murderers, leading to the collapse of society. The only difference is that it's not physically impossible for a UBI ever to exist.

 

[Elixir]

It is an old stereotype I have heard in the past.

People are poor because they want to be. They are happy being poor.

I'm sure you are not saying you ascribe to that view. But personally I find some truth to it. It does depend on how poor "poor" is though. Basic needs met (food, shelter, clothing), owning anything beyond what is required to meet those needs is a burden. Some things might seem to the owner to represent a negligible burden weighed against their yield in pleasure or happiness, but as things accumulate so does the burden. In fact, the burden is proportioned to that yield; those are the things we care about, or would be really unhappy if we lost. That's true of things with monetary value, things of sentimental value, things we just happen to like..

I'm thinking of the pang of loss I felt a few months ago when I was looking for a particular rock that I liked, among a collection of rocks on the rail of our deck. I remarked about it and Mrs Elixir told me she had thrown it ... such a little thing, such a little pain.

There is a reason for the camel/eye of a needle thing in the bible, other than (like everything else in the bible) to perpetuate a political power structure.

 

[Bomb#20]

I assumed you meant what you said, and that you weren't expecting me to read your mind about any assumptions you didn't bother to mention. Apparently that was a mistake.

The words "pay them just compensation for taking their private property for public use" was a reference to a provision of the U.S. Constitution that's so well-known I took for granted I could depend on readers to recognize it; but of course there are quite a few of you funny furriners here. Sorry, my bad.

That's another reason. It may be the reason you are thinking about. But it's not THE reason, to the exclusion of any other.

Metaphysics. It's THE reason in the sense that the other reasons you list were in operation all along and were neither necessary nor sufficient to make income tax legal; but when the 16th Amendment legalized income tax it made it legal.

A 100% income tax would certainly lead to a (presumably gradual) reduction in their wealth, assuming that they cannot live free, gratis and for nothing. Is there a provision in US law that prevents the enacting of a tax bracket of greater than 100%?

Good question. The SCOTUS might well hold that you can't take more than 100% of anything so if a guy with a $10 million income is taxed $12 million then you obviously took something other than his income. But I don't know of directly pertinent case law. A state tax law with that effect was overturned, but it was on the grounds that Maryland screwed with interstate commerce.

A 120% tax on income in excess of a million dollars would presumably have a significant impact on the wealth of billionaires

Probably not much more than a 100% tax -- people would respond by simply stopping their income streams.

It should also be noted that much of the 6 trillion dollars of wealth isn't dollars, but stock. Stock is worth what it's worth primarily because it's ownership of a fraction of the future revenue stream of ongoing productive operations. Those productive operations rely on the continuing operations of a government that takes private property rights seriously. If the government ever tries to legalize mass confiscations of existing wealth, this will indicate that it no longer takes private property rights seriously. The stock market will crash and much of the 6 trillion dollars of wealth will promptly vanish in a puff of illogic.)

Taxation is legal. A steady erosion of wealth through taxation is unremarkable, and needn't imply "mass confiscations" of anything. Though I concur that there would be a significant reduction in stock values once stocks ceased to be a guaranteed way to turn too much money into far too much money.

Um, you do know there are no guarantees that stocks will rise, don't you?

As governments don't need revenue in order to spend, it's really not important whether the money disappears from the economy as taxes, or as the result of a stock market crash. The spending can occur without risking runaway inflation in either case.

You're talking as though all that's wiped out in a stock market crash is currency. The currency is wiped out because the expected future revenue stream is wiped out because the expected future production is wiped out. If the government tries to spend that $6 trillion without $6 trillion worth of goods and services backing it up, then yes, they'll be risking runaway inflation.

That it would not be easy to change the law is completely beside the point. The law could be changed to introduce a wealth tax and/or a 100% income tax with the goal of eliminating billionaires.

Well, any one country could do that. The billionaires would move to saner countries. It's hard to picture a scenario where every country tries to eliminate billionaires, when whichever countries went first would so obviously be injuring themselves while the countries taking in billionaires fleeing from other countries would so obviously be benefitting. I guess if you first set up a world government you could legally eliminate them.

In any event, eliminating billionaires would destroy more wealth than it would redistribute, and very little of whatever wealth it did succeed in collecting would be applied to world hunger or climate change.

And doing so would neither be illegal, nor lead inevitably to the taxing out of existence of people at lower levels of wealth.

The motivation for eliminating billionaires is pathological anti-rich bigotry, primarily caused by zero-sum-game idiocy. It's a deeply irrational emotional impulse. So what's your scenario for making your new bonfire of the vanities stop when it gets to $1 billion?