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"Graham's point is that if one person makes more than another because they're more productive, you don't want to "fix" that, because it's not a problem, it's wh

by jshen 11y ago

"Graham's point is that if one person makes more than another because they're more productive, you don't want to "fix" that, because it's not a problem, it's what fuels economic growth." I do not believe he said this, and it's a non sequitur

pdonis 11y ago
> I do not believe he said this How many of his essays have you read? It's a fairly common theme in them. > it's a non sequitur The argument is pretty simple: people who are more productive are capable of creating more wealth; the best and most straightforward way (and the only one that's been shown to work consistently) to motivate them to exercise that capability is to allow them to get richer by creating more wealth; wealth creation is economic growth.
- jshen 11y ago
  Please show me a quote where PG makes this argument. I doubt Steve Jobs would have created more wealth if he were allowed to pay 10% lower taxes. Do you?
  - pdonis 11y ago
    > Please show me a quote where PG makes this argument. Once again, how many of PG's essays have you read? This is like asking someone in your English literature class to show you an example of Shakespeare making a joke in one of his plays. But ok, I'll play along. In the subject essay, PG describes himself as a "manufacturer of economic inequality". How is he manufacturing it? By teaching people how to get rich by creating wealth: "Not just by helping the 2400 founders YC has funded. I've also written essays encouraging people to increase economic inequality and giving them detailed instructions showing how." So PG obviously is arguing that allowing people to get rich by creating wealth will increase economic inequality. How? By amplifying the variation in productivity between people. And there's no way to get rid of that without getting rid of wealth creation: "Variation in productivity is far from the only source of economic inequality, but it is the irreducible core of it, in the sense that you'll have that left when you eliminate all other sources." As for the part where wealth creation is what fuels economic growth, do you really need a quote for that? I would have thought it was blindingly obvious. (In fact, I would say wealth creation is economic growth.) > I doubt Steve Jobs would have created more wealth if he were allowed to pay 10% lower taxes. I doubt Steve Jobs would have bothered to create much wealth at all if he hadn't thought he could get rich from it. Which is much more to the point.
    - Futurebot 11y ago
      This thread has gotten a bit muddled, but I don't think the thrust of the argument is that Jobs didn't want to get rich (did someone upthread actually argue that?); instead, its "if he had to get somewhat less rich, would he have done what he did?", to which I think it's far to ask "yes, but how much less would he have been OK with before he said 'no way'?" The discussion is about marginal tax rates without stating it as such. He might not have been OK with a 95% MTR, but would he have done it with a 45? a 50? People could opine on what he would have or would not have done given that, but I think it's reasonable to say that many people would, and do (given that successful innovators and businesses exist in higher tax countries.) Higher marginal tax rates don't mean you don't get rich; they mean you don't get quite as rich, which is what much of the proposals are about.
      - pdonis 11y ago
        > The discussion is about marginal tax rates No, it isn't. The discussion is about Graham's claim (which I agree with) that income inequality due to variations in productivity--i.e., allowing people to get rich in proportion to how much wealth they create--is an unavoidable consequence of economic growth, which means you can't get rid of it without getting rid of economic growth. Graham makes a separate claim about tax rates, which is that the marginal tax rate has basically no effect at all on tax receipts as a percentage of GDP. This argument is based on nothing more than looking at the actual statistics since World War II, which do indeed show what he claims. But in itself, it says nothing about what, if any, effect marginal tax rates have on wealth creation.

by jshen 11y ago

pdonis 11y ago

> I do not believe he said this How many of his essays have you read? It's a fairly common theme in them. > it's a non sequitur The argument is pretty simple: people who are more productive are capable of creating more wealth; the best and most straightforward way (and the only one that's been shown to work consistently) to motivate them to exercise that capability is to allow them to get richer by creating more wealth; wealth creation is economic growth.

jshen 11y ago
Please show me a quote where PG makes this argument. I doubt Steve Jobs would have created more wealth if he were allowed to pay 10% lower taxes. Do you?
- pdonis 11y ago
  > Please show me a quote where PG makes this argument. Once again, how many of PG's essays have you read? This is like asking someone in your English literature class to show you an example of Shakespeare making a joke in one of his plays. But ok, I'll play along. In the subject essay, PG describes himself as a "manufacturer of economic inequality". How is he manufacturing it? By teaching people how to get rich by creating wealth: "Not just by helping the 2400 founders YC has funded. I've also written essays encouraging people to increase economic inequality and giving them detailed instructions showing how." So PG obviously is arguing that allowing people to get rich by creating wealth will increase economic inequality. How? By amplifying the variation in productivity between people. And there's no way to get rid of that without getting rid of wealth creation: "Variation in productivity is far from the only source of economic inequality, but it is the irreducible core of it, in the sense that you'll have that left when you eliminate all other sources." As for the part where wealth creation is what fuels economic growth, do you really need a quote for that? I would have thought it was blindingly obvious. (In fact, I would say wealth creation is economic growth.) > I doubt Steve Jobs would have created more wealth if he were allowed to pay 10% lower taxes. I doubt Steve Jobs would have bothered to create much wealth at all if he hadn't thought he could get rich from it. Which is much more to the point.
  - Futurebot 11y ago
    This thread has gotten a bit muddled, but I don't think the thrust of the argument is that Jobs didn't want to get rich (did someone upthread actually argue that?); instead, its "if he had to get somewhat less rich, would he have done what he did?", to which I think it's far to ask "yes, but how much less would he have been OK with before he said 'no way'?" The discussion is about marginal tax rates without stating it as such. He might not have been OK with a 95% MTR, but would he have done it with a 45? a 50? People could opine on what he would have or would not have done given that, but I think it's reasonable to say that many people would, and do (given that successful innovators and businesses exist in higher tax countries.) Higher marginal tax rates don't mean you don't get rich; they mean you don't get quite as rich, which is what much of the proposals are about.
    - pdonis 11y ago
      > The discussion is about marginal tax rates No, it isn't. The discussion is about Graham's claim (which I agree with) that income inequality due to variations in productivity--i.e., allowing people to get rich in proportion to how much wealth they create--is an unavoidable consequence of economic growth, which means you can't get rid of it without getting rid of economic growth. Graham makes a separate claim about tax rates, which is that the marginal tax rate has basically no effect at all on tax receipts as a percentage of GDP. This argument is based on nothing more than looking at the actual statistics since World War II, which do indeed show what he claims. But in itself, it says nothing about what, if any, effect marginal tax rates have on wealth creation.