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The standard left wing complaint is that billionaires don't have enough lavish parties, but instead reinvest their wealth in new productive capacity. See, e.g.,

The standard left wing complaint is that billionaires don't have enough lavish parties, but instead reinvest their wealth in new productive capacity. See, e.g., Picketty, Krugman, or anyone favoring stimulus directed at the bottom of the income distribution. Do you dispute this? As for erasing class distinctions, consider the possibility that we already have. Imagine telling a person in 1915 about the world today; the children of rich struggling hard in school with the goal of getting a job where they can work hard in order to provide consumption for the poor (who mostly don't work). These rich people will wear the same hoodies and turtlenecks as anyone else, live in moderately larger houses than the poor (or at least in moderately nicer locations), and have virtually no goods and services that are unavailable to the poor. Would this modern world not count as wildly imaginative?

danieltillett 11y ago
I think you are describing the upper middle income rich. The ultra rich are nothing like us in the main.
- merpnderp 11y ago
  They use the same iPhone, have access to the same chemo, and watch the same movies. The only difference is they fly in private planes instead of commercial, drive high end Mercedes instead of Fords, live in mansions instead of apartments. But their HVAC cools just the same as my window unit, it's just quieter. Yeah, they have lots of things we don't. But the difference is smaller than between a rich person in 1915 and a poor person today.
  - danieltillett 11y ago
    I think the life of the ultra rich is fundamentally different to the average middle income person in the same way that royalty lives a different life to a commoner. Sure we all breath, eat, sleep and procreate, but the differences in the concerns of the ultra rich and the rest of us is quite large. A poor person today is richer in many ways to the rich of 1915 thanks to technological advance, but there still is a huge gap between the opportunities of the poor today and those of the ultra rich. More fundamentally I just don’t think it is good for the ultra rich to live a life that is so different to the rest of society. These people have an enormous amount of power and it is not good for the rest of us if they live a life detached from the worries and concerns of us common folk. You just can’t make good decisions on the basis of bad information and if this is formed from the worries and concerns of your ultra rich friends and you then you are going to end up with a warped perspective of what life for most people.
    - yummyfajitas 11y ago
      In what way is it different? You keep asserting this without making any concrete claims.
      - danieltillett 11y ago
        As a non-member of the ultra rich all I can do is look in on the peeks they give us via the media. I am willing to admit that it is possible that they are exactly like you and me, but they certainly don't appear to be. In regards concrete claims the ultra rich appear to far more to the economic right than the average person. I am sure you are aware of this.
        tempestn 11y ago
        > In regards concrete claims the ultra rich appear to far more to the economic right than the average person. Are you sure that's true? It may be, but there are certainly plenty of counter-examples. Gates and Buffett immediately come to mind, as well as presumably many of the people on this page: http://givingpledge.org/ http://givingpledge.org/
        danieltillett 11y ago
        I am not to sure how to the left Gates and Buffett actually are, but they are really good examples of ultra rich with the perspective of the upper middle classes. Unlike the hereditary ultra rich, they are self-made men who grew up in upper middle class families. The fact that they want to give away their wealth rather than pass it on to their children is a sign they recognise the morally corrosive nature of inherited wealth. If I were asked I would be keen to lower taxes on incomes and raise taxes on inheritances. We really don’t need a self-perpetuating parasitic overclass.
        yummyfajitas 11y ago
        Lots of groups are far to the economic right of the average person. For example, this is probably true of people who subscribe to Scott Sumner's blog. Is it therefore reasonable to say "I think the lives of people who read Scott Sumner's blog are fundamentally different to the average middle income person in the same way that royalty lives a different life to a commoner"? If not, why not?
Apocryphon 11y ago
It's not enough, just as going to the Moon was not enough.
sytelus 11y ago
You are missing a big point. Sure super rich can only utilize fraction of their wealth however rest of the wealth rarely gets utilized to increase productivity of the society. The majority of investments in their portfolios (as per Piketty's carefully collected data) are actually in non-productive activities such as real estate, hedge funds, HFT, derivatives, commodity manipulation and so on. These investments manipulates markets such as real estate to perpetually increase value of their investments without positive impact on society. In fact, from analysis of Piketty's data it was found that if wealthy people only invested in "productive" instruments then their wealth accumulation would dramatically deaccelerate. So the argument that wealthy provides most of their capital for economy to bloom is fairly misleading. They do provide this capital for some GDP growth but it's fairly small part of their investment portfolio. The major portion of the portfolio has singular goal of generating massive passive income perpetually for generations by activities such as artificially limiting supply side or ballooning demand side in markets such as real estate. There are no known social advantage of these kind of investments. Next time when you send that $3000 mortgage payment, put a note there: "wealth transfer for 1%" :). See other comment: https://news.ycombinator.com/edit?id=10829915 https://news.ycombinator.com/edit?id=10829915
- yummyfajitas 11y ago
  How are real estate, hedge funds or derivatives non-productive? A hedge fund or derivative investment ultimately directs productive assets towards real world uses. If the wealthy are getting high returns from this (and Picketty claim the wealthy get the highest returns), then the wealthy are better at directing real investments to their most productive use. Could you point me to the place in Picketty where he does more than speculate about how the wealthy gain more wealth? These investments manipulates markets such as real estate to perpetually increase value of their investments without positive impact on society. You seem to be confusing middle class NIMBYs (the main people manipulating real estate markets) with the very rich. Middle class homeowners are the ones preventing new construction, it's the wealthy developers who are trying (and failing) to be productive.
  - sytelus 11y ago

danieltillett 11y ago

I think you are describing the upper middle income rich. The ultra rich are nothing like us in the main.

merpnderp 11y ago
They use the same iPhone, have access to the same chemo, and watch the same movies. The only difference is they fly in private planes instead of commercial, drive high end Mercedes instead of Fords, live in mansions instead of apartments. But their HVAC cools just the same as my window unit, it's just quieter. Yeah, they have lots of things we don't. But the difference is smaller than between a rich person in 1915 and a poor person today.
- danieltillett 11y ago
  I think the life of the ultra rich is fundamentally different to the average middle income person in the same way that royalty lives a different life to a commoner. Sure we all breath, eat, sleep and procreate, but the differences in the concerns of the ultra rich and the rest of us is quite large. A poor person today is richer in many ways to the rich of 1915 thanks to technological advance, but there still is a huge gap between the opportunities of the poor today and those of the ultra rich. More fundamentally I just don’t think it is good for the ultra rich to live a life that is so different to the rest of society. These people have an enormous amount of power and it is not good for the rest of us if they live a life detached from the worries and concerns of us common folk. You just can’t make good decisions on the basis of bad information and if this is formed from the worries and concerns of your ultra rich friends and you then you are going to end up with a warped perspective of what life for most people.
  - yummyfajitas 11y ago
    In what way is it different? You keep asserting this without making any concrete claims.
    - danieltillett 11y ago
      As a non-member of the ultra rich all I can do is look in on the peeks they give us via the media. I am willing to admit that it is possible that they are exactly like you and me, but they certainly don't appear to be. In regards concrete claims the ultra rich appear to far more to the economic right than the average person. I am sure you are aware of this.
      - tempestn 11y ago
        > In regards concrete claims the ultra rich appear to far more to the economic right than the average person. Are you sure that's true? It may be, but there are certainly plenty of counter-examples. Gates and Buffett immediately come to mind, as well as presumably many of the people on this page: http://givingpledge.org/ http://givingpledge.org/
        danieltillett 11y ago
        I am not to sure how to the left Gates and Buffett actually are, but they are really good examples of ultra rich with the perspective of the upper middle classes. Unlike the hereditary ultra rich, they are self-made men who grew up in upper middle class families. The fact that they want to give away their wealth rather than pass it on to their children is a sign they recognise the morally corrosive nature of inherited wealth. If I were asked I would be keen to lower taxes on incomes and raise taxes on inheritances. We really don’t need a self-perpetuating parasitic overclass.
      - yummyfajitas 11y ago
        Lots of groups are far to the economic right of the average person. For example, this is probably true of people who subscribe to Scott Sumner's blog. Is it therefore reasonable to say "I think the lives of people who read Scott Sumner's blog are fundamentally different to the average middle income person in the same way that royalty lives a different life to a commoner"? If not, why not?

Apocryphon 11y ago

It's not enough, just as going to the Moon was not enough.

sytelus 11y ago

You are missing a big point. Sure super rich can only utilize fraction of their wealth however rest of the wealth rarely gets utilized to increase productivity of the society. The majority of investments in their portfolios (as per Piketty's carefully collected data) are actually in non-productive activities such as real estate, hedge funds, HFT, derivatives, commodity manipulation and so on. These investments manipulates markets such as real estate to perpetually increase value of their investments without positive impact on society. In fact, from analysis of Piketty's data it was found that if wealthy people only invested in "productive" instruments then their wealth accumulation would dramatically deaccelerate. So the argument that wealthy provides most of their capital for economy to bloom is fairly misleading. They do provide this capital for some GDP growth but it's fairly small part of their investment portfolio. The major portion of the portfolio has singular goal of generating massive passive income perpetually for generations by activities such as artificially limiting supply side or ballooning demand side in markets such as real estate. There are no known social advantage of these kind of investments. Next time when you send that $3000 mortgage payment, put a note there: "wealth transfer for 1%" :). See other comment: https://news.ycombinator.com/edit?id=10829915 https://news.ycombinator.com/edit?id=10829915

yummyfajitas 11y ago
How are real estate, hedge funds or derivatives non-productive? A hedge fund or derivative investment ultimately directs productive assets towards real world uses. If the wealthy are getting high returns from this (and Picketty claim the wealthy get the highest returns), then the wealthy are better at directing real investments to their most productive use. Could you point me to the place in Picketty where he does more than speculate about how the wealthy gain more wealth? These investments manipulates markets such as real estate to perpetually increase value of their investments without positive impact on society. You seem to be confusing middle class NIMBYs (the main people manipulating real estate markets) with the very rich. Middle class homeowners are the ones preventing new construction, it's the wealthy developers who are trying (and failing) to be productive.
- sytelus 11y ago