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This article provides paragraph after paragraph of supporting data that the richest have gotten richer, but none that I can see supporting its claim that “billi

This article provides paragraph after paragraph of supporting data that the richest have gotten richer, but none that I can see supporting its claim that “billions of poorer people across the world have seen their wealth standstill or decline”.

notyourwork 9y ago
Is it possible for everyone’s wealth to increase? I think they might be assuming this is not possible and there if richest wealth increases by this much it had to come from the rest?
- kachurovskiy 9y ago
  Rich people tend to have most of their worth in stock. In theory, assuming your stock got more expensive, you get richer without anyone in particular getting poorer.
  - walterbell 9y ago
    Inflation = everyone in cash got poorer
    - pdkl95 9y ago
      Or. everyone with debt - which is usually a very large portion of the population - had their burden reduced. edit: Ability to pay grows with inflation, by definition. Unless you have a particularly unusual type of debt, the principle is constant and the interest is based on the remaining principle and is therefor a pre-inflation value. Wages grow in absolute terms (even though their purchasing power is otherwise constant), so the debt is easier to pay off.
      - walterbell 9y ago
        Along with their ability to repay their debt, so that's a wash.
        deleted 9y ago
        [deleted]
    - jcmoscon 9y ago
      Not if you have bitcoins, right?
  - jumsdogpetter 9y ago
    The theory is naive, dismissive, and wrong. Stock value increases are coming from optimizations within companies that reduce employee benefits and compensation. On the consumer side of things, profits also come from taking advantage of deregulation, lowering the quality and safety of consumer products and services. Executive leadership and investors are pocketing gains made from making everyone else's lives worse. Getting richer has a strong relationship with making others poorer.
    - newmanships 9y ago
      Are you saying stock value increases only come from reducing employee benefits and compensation or from lowering the quality and safety of products and services? Seems like that is simply not true across the board. If a company sells say software they could easily grow revenue and profits without changing their product or reducing employee benefits and compensation. Their earnings would be higher and their stock would go up.
    - ericd 9y ago
      How much of this opinion is coming from being involved in the management of companies vs news articles tuned to generate outrage so that they can generate clicks?
      - jumsdogpetter 9y ago
        How much of your denial comes from benefiting from the immiseration of the poor?
        ericd 9y ago
        I'm serious. Do you have first hand knowledge of what you speak, or are you just looking for someone to be angry at? Also, looking at your comment history, you've literally only ever commented on the misery of the proletariat and related topics, which makes me suspect this is an astroturfing account.
    - AnimalMuppet 9y ago
- gbacon 9y ago
  The notion that wealth is a fixed-size pie is central to the long-debunked economic error known as mercantilism.
- foobarian 9y ago
  In real terms this could happen if productivity increased, and was able to lead to increased standard of living for everyone. This probably did happen for some large subset of the population, by some definition of "standard of living."
- poke111 9y ago
  The central idea of capitalism is that voluntary exchange enriches both parties. So the answer to your first question is yes.
  - sametmax 9y ago
    This assumes the exchange is symmetric, and that enrichment only happens with exchanges. Neither of these are true.
    - wskinner 9y ago
      It doesn’t have to be symmetric. If there is $2 consumer and $4 producer surplus, both parties benefit. And just because enrichment, as you call it, can happen other ways than exchange, does not mean it doesn’t happen via exchange too.
      - dragonwriter 9y ago
        If it is asymmetric, the superficially apparent mutual gain may be illusory, because—while many people think for moral or aesthetic reasons that this should not be the case—there is enormous empirical evidence that the actual experience of utility related to material position is very strongly driven by relative material position, which is often far more significant than absolute material position.
        Banthum 9y ago
        Parent is saying that it's better if everyone gets richer, even if some get more richer than others. So you're saying that it would be better if everyone was poorer individually, as long as they were more equally poor?
        grasshopperpurp 9y ago
        >So you're saying that it would be better if everyone was poorer individually, as long as they were more equally poor? Why are you creating this either/or? Are you proposing that if we don't allow people like Gates and the Kochs to hoard billions of dollars that everyone will be poorer individually?
- ghostbrainalpha 9y ago
  Yes it is possible for everyone's wealth to increase. In the year 1900 Global GDP was 1 Trillion. Today it is 77 Trillion. https://en.wikipedia.org/wiki/Gross_world_product https://en.wikipedia.org/wiki/Gross_world_product In Layman's the Global Pie is growing. The number of people living in extreme poverty has fallen DRASTICALLY over the last 25 years. https://twitter.com/humanprogress/status/913901718823489538 https://twitter.com/humanprogress/status/913901718823489538 So the people with the smallest piece of the pie are slowly getting a larger piece, but the people who already have the biggest piece of pie are getting even bigger pieces faster. But because the pie is growing, it doesn't mean that their larger piece is making someone else get a smaller piece. The only people who have a proportionally smaller piece than they used to are in the middle class. Which is what happens when first world work more closely with developing nations. Taking more people out of extreme poverty but putting slight downward pressure on the middle class.
  - mtgx 9y ago
    Even if it did increase, most of that increase is just inflation anyway. And it's usually the wealthy that benefit from inflation (at least more than regular people do).
    - JumpCrisscross 9y ago
      > it's usually the wealthy that benefit from inflation Inflation is a regressive feature of modern currencies. It transfers wealth from lenders to borrowers and away from investors. The degree to which it does so is a function of the amount of wealth one has.
    - ghostbrainalpha 9y ago
      Compare the "regular" person of today to the "regular" person of 50 years ago. Is it easier or harder to afford basic foodstuffs? Do they eat out (luxury) more or less? If they own a home, is it larger or the same size? Who travels more? Who has better healthcare? Who spends more on entertainment? How much do they spend on the family pet? Who spent more time furthering their education? All of these are measures of wealth, and the modern "regular" person would be wealthier in every one of these categories. And that's not even factoring in advances in technology that make the quality of life of a person better even if there share of societal wealth goes down.
- olalonde 9y ago
  Yes, it is definitely possible and expected. Your line of reasoning is a pretty common one and is sometimes referred to as the "zero-sum fallacy" or "fixed pie fallacy"[0]. [0] http://www.aei.org/publication/the-fixed-pie-fallacy/ http://www.aei.org/publication/the-fixed-pie-fallacy/
- obastani 9y ago
  As many other commenters have pointed out, it is possible for net global wealth to increase (e.g., the increase in total real GDP). As far as I understand, the main reason this is possible is the development of new "technology" -- in the very general, economic sense of the word technology [0], which includes anything that increases the productivity of a single worker; this can include everything from new technology in the traditional sense to new processes (e.g., agile vs. waterfall for software development, or more optimal supply chains) and investment in infrastructure (e.g., better road networks). For example, a single farmer today can not only produce many times more crop compared to a farmer 100 years ago, but also safely and efficiently distribute this produce to consumers across the globe. In general, assuming everyone in the economy works equally hard, the total production (i.e., the global net wealth) can increase as long as technology is increasing. [0] https://en.wikipedia.org/wiki/Production_function https://en.wikipedia.org/wiki/Production_function
- ericd 9y ago
  If I fix your bike, and in exchange, you fix my bike, we're both richer in material terms than we were before.
- eeZah7Ux 9y ago
  > Is it possible for everyone’s wealth to increase? Numerically, yes. Psychologically and socially it's completely different. As inequality rises, people whose wealth increases more slowly are effectively poorer in relative terms.
eximius 9y ago
While a technically valid criticism, is it really that controversial? Costs are increasing faster than wages at low income levels - which is easy when wages are largely stagnant or declining due to increased competition driven by labor surplus and automation.
- ptaipale 9y ago
  It's not even controversial, it's wrong. Poverty, particularly extreme poverty, has been decreasing rapidly over the past 25 years. Of course, this doesn't mean that everyone is better; there are always winners and some losers, and there are setbacks here and there, but the big picture is one of great progress. For more, one should read the Human Development Reports: http://hdr.undp.org/sites/default/files/2016_human_development_report.pdf http://hdr.undp.org/sites/default/files/2016_human_developme...
  - aalleavitch 9y ago
    This is true for worldwide poverty. This is not true for US poverty.
    - oreo81 9y ago
      In the US "poverty" now includes access to netflix. Poverty has absolutely gotten better in the US over the years.
      - ABCLAW 9y ago
        Poverty also includes having your neighborhood torn apart by junkies on opioids. But I guess actually looking at the econometric data to compare apples to apples isn't worthwhile because you can stay indoors while your tires are stolen and watch Jessica Jones, so things are better than they used to be, right?
        oreo81 9y ago
        Yes things are better than they used to be. People living in bad neighborhoods spending time and money on entertainment need to prioritize better.
rstoj 9y ago
Good point - I wonder where that comes from, can anyone find a reference? In any case, their wealth is increasing at a much higher rate of 23% compared with the world GDP increase of 2.4% and US' GDP increase of 1.5% (https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2016&start=1961&view=chart https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2...).
- lhkdfsakhljd 9y ago
  Yeah, but paper tigers like Zuckerberg are on that list. The top 1500 richest includes the twiddly twins and their bitcoin empire. They're all one tech bubble bursting from loosing most of their wealth.
  - sametmax 9y ago
    The same kind of rich people has existed for ever. It's fair to always take them in consideration.
coliveira 9y ago
The issue is simple to understand: as population grows and technology grows even faster, there should be a steady stream of wealth increase. This has been observed as is obvious to everyone. However, if we allow the bulk of this wealth to be controlled by a tiny part of the population, we are creating a huge problem to current and to future generations. A hereditary oligarchy can be terrible to our civilization, and this is what we see forming nowadays. I am not against people participating in the creation of wealth and reaping the rewards, but these differences in wealth need to be leveled over time. Unfortunately, short-sighted politics of the US and other countries are giving more and more power to wealthy people so that they can amass more money without visible contributions to society.
- charlesdm 9y ago
  Maybe. I don't want this to come off bad, but maybe the work a lot of people do just isn't that important and thus doesn't warrant increases in salary? If a company needs someone to do X, and 5 viable candidates can be found for $Y -- there really is no reason to increase wages. Anyone with some capital could've invested in Netflix, Facebook or Google several years ago and would have achieved a good return on their money. Even if some sort of global wealth tax would be introduced (that's a big IF) to fix the accumulation of extreme wealth, would people be better off? The amounts collected, spread out over the entire population, would be relatively small. And most of this new wealth is mostly paper wealth -- the headline next year could very well be: "World's richest lost $3tn of their wealth".
  - nofilter 9y ago
    How well does that argument hold up tho'? I mean, there is always _someone_ who does it cheaper. Always. In fact I know of a web developer, who actually does quite decent work and is available for as little as $5 per hour. Does that mean everyone in that skill level should get paid so little?
    - charlesdm 9y ago
      Cheaper yes, but perhaps not better. I'd be happy to demand a few million a year for high quality development work from an employer, but the laws of supply and demand do apply.
jondubois 9y ago
You don't need any data to support that fact, any regular person can see for themselves that this is true just by looking at their own situation and that of their family members, friends, neighbors and acquaintances.
krona 9y ago
The richest have gotten richer To be exact, it seems to be saying that the richest 500 are x% richer at the end of the year, not that the 500 richest at the beginning of the year are %x richer at the end of it. These are two different things because they are two different sets of people. In decades past the richest and the poorest people don't remain in that part of the income distribution very long; this is especially true in the US.
- bitwize 9y ago
  Actually, it's especially false in the US, because social mobility is so poor for such a "free" state.
  - krona 9y ago
    From 2001 to 2007 (just 6 years), the proportion of US households that left their income quintile were (starting at the lowest quintile) 44%, 61%, 58%, 55%, and 34%. Even by global standards that's quite high income mobility.
    - addicted 9y ago
      The choices of year bounds are interesting to say the least.
      - ChrisLomont 9y ago
        Those changes are about the same for any window of the same time length for all of recent US history. St. Louis FRED has data and papers on this. One of the best studies on intergenerational mobility in the US, using all IRS records (not sure how hard they had to work to get those) shows that mobility in the US has been fairly constant for 50+ years. [1] http://www.equality-of-opportunity.org/assets/documents/mobility_trends.pdf http://www.equality-of-opportunity.org/assets/documents/mobi...
- pg314 9y ago
  > These are two different things because they are two different sets of people. The sets mostly overlap. The top 10 of the richest people was the same in 2016 and 2017 [1]. These 10 people saw their net worth increase by $107 billion. [1] https://en.wikipedia.org/wiki/The_World%27s_Billionaires#2017 https://en.wikipedia.org/wiki/The_World%27s_Billionaires#201...
aalleavitch 9y ago
Wages have stagnated and the poor are not seeing an equivalent increase in their wealth. Moreover, while the jobs numbers are very high 94% of all jobs added in the last decade have been temp/contract work/self-employment. https://hbr.org/2017/10/why-wages-arent-growing-in-america https://hbr.org/2017/10/why-wages-arent-growing-in-america https://www.vox.com/policy-and-politics/2017/8/8/16112368/piketty-saez-zucman-income-growth-inequality-stagnation-chart https://www.vox.com/policy-and-politics/2017/8/8/16112368/pi... https://qz.com/851066/almost-all-the-10-million-jobs-created-since-2005-are-temporary/ https://qz.com/851066/almost-all-the-10-million-jobs-created...
- closeparen 9y ago
  We set up an incentive scheme to vigorously punish employers for offering full time work by loading it down with obligations over the worker’s long term well being, and didn’t do anything similar for temp/contract work. What were you expecting? If we attached proportional responsibility to part time work, or just provided benefits out of the public purse instead of labor law, part time work wouldn’t be such an obviously superior choice to employers.
- cornholio 9y ago
  On the other hand, the wages of 700 million Chinese workers has trebled in the last decade.
  - oblio 9y ago
    And humanity, as a whole, will probably reap a ton of long term benefits from it. I doubt there's much solace in this thought for someone being fired because of it, though. (Personally I don't mind a bit of hardship if it helps everyone, but I understand not everyone can be frugal or that some people can be just plain unlucky)
    - aalleavitch 9y ago
      It's also a lot harder to swallow when you're hungry and someone out there is making enough to feed 100 of you.
11thEarlOfMar 9y ago
Indeed, according to World Bank, the number of people living in poverty is decreasing. % from 1820 - 2015: https://ourworldindata.org/slides/world-poverty/#/declining-world-poverty-1820-2015-step2 https://ourworldindata.org/slides/world-poverty/#/declining-... Distribution 1988: https://ourworldindata.org/slides/world-poverty/#/Global-Income-Distribution-1988 https://ourworldindata.org/slides/world-poverty/#/Global-Inc... Distribution 2011: https://ourworldindata.org/slides/world-poverty/#/Global-Income-Distribution-2011 https://ourworldindata.org/slides/world-poverty/#/Global-Inc...
dclowd9901 9y ago
If you're burying your head in the sand, you're missing the headlies that wages have been stagnant for decades.
- umeshunni 9y ago
  Nearly a billion people have been pulled out of poverty in India and China over the last 25 years. Their wages have at least tripled on average in real terms in the last 20 years. So, it's you who's burying your head in the "America first" sand. The middle class in the US had enjoyed the fruits of global inequality resulting from colonialism and WW2 during the second half of the 20th century. As the gap in skills and education between the average American and the rest of the world have disappeared, the former US middle class will see their income gap with the rest of the world also disappear. A teacher, factory worker or a store clerk in the US isn't 20x more productive than a teacher, factory worker or a store clerk in India or China and there's not reason for that wage gap to exist any more.
  - oblio 9y ago
    Yeah, but things might not go swimmingly. We will see violence, protectionism, plain old isolationism rise. The developed countries are still developed and their citizens will fight back.
  - dclowd9901 9y ago
    Are you really sitting here and telling me that people merely being brought out of destitution is progress? We have far different views on progress.
    - ptaipale 9y ago
      I am not entirely sure if you are trolling. People being brought out of destitution is progress, absolutely. It's the very first and most important step of progress. If people don't have enough to eat, even their brain won't develop properly. The lower layers of Maslow hierarchy are absolutely essential. After that, more progress is needed, but having food, essential health and physical security is definitely the fundamental thing for any other types of progress, such as education.
Mikeb85 9y ago
As the wealth gets more concentrated at the top, the wealth 'share' of poorer people declines even if their wealth nominally rises.
dbingham 9y ago
It's a pretty well understood and accepted fact at this point. It's been a major talking point in economic and political circles for the past 5 - 10 years. The sources below are from a quick Google search. They mostly reference income stagnation and are about the US. But income stagnation leads to wealth stagnation and there are similar trends world wide. Thomas Picketty's Capital in the 21st Century is largely about this issue, as is Robert Reich's documentary Inequality for All. There are those who challenge the conclusions drawn in both, but few seriously contest the data they point to. [1] http://www.epi.org/publication/charting-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/ [2] https://www.npr.org/sections/money/2014/10/02/349863761/40-years-of-income-inequality-in-america-in-graphs https://www.npr.org/sections/money/2014/10/02/349863761/40-y... [3] https://www.economist.com/blogs/freeexchange/2013/09/incomes https://www.economist.com/blogs/freeexchange/2013/09/incomes [4] http://www.nytimes.com/2013/01/13/sunday-review/americas-productivity-climbs-but-wages-stagnate.html http://www.nytimes.com/2013/01/13/sunday-review/americas-pro...
rayiner 9y ago
That claim is not only unsupported, it's almost certainly false. The last few decades haven't been great for the middle class in wealthy countries, but it's been fantastic for "poorer people across the world." U.S. GDP per capita is up 60% since 2000. Bangladesh's is up 235%. India is up 288%. Thailand is up 195%. Poorer countries that have been able to cobble together enough rule of law to participate in capitalism have benefited tremendously from it.
- andai 9y ago
  GOAL 1: ERADICATE EXTREME POVERTY & HUNGER Target 1.A: Halve, between 1990 and 2015, the proportion of people whose income is less than $1.25 a day The target of reducing extreme poverty rates by half was met five years ahead of the 2015 deadline. More than 1 billion people have been lifted out of extreme poverty since 1990. In 1990, nearly half of the population in the developing regions lived on less than $1.25 a day. This rate dropped to 14 per cent in 2015. http://www.un.org/millenniumgoals/poverty.shtml http://www.un.org/millenniumgoals/poverty.shtml

notyourwork 9y ago

Is it possible for everyone’s wealth to increase? I think they might be assuming this is not possible and there if richest wealth increases by this much it had to come from the rest?

kachurovskiy 9y ago
Rich people tend to have most of their worth in stock. In theory, assuming your stock got more expensive, you get richer without anyone in particular getting poorer.
- walterbell 9y ago
  Inflation = everyone in cash got poorer
  - pdkl95 9y ago
    Or. everyone with debt - which is usually a very large portion of the population - had their burden reduced. edit: Ability to pay grows with inflation, by definition. Unless you have a particularly unusual type of debt, the principle is constant and the interest is based on the remaining principle and is therefor a pre-inflation value. Wages grow in absolute terms (even though their purchasing power is otherwise constant), so the debt is easier to pay off.
    - walterbell 9y ago
      Along with their ability to repay their debt, so that's a wash.
      - deleted 9y ago
        [deleted]
  - jcmoscon 9y ago
    Not if you have bitcoins, right?
- jumsdogpetter 9y ago
  The theory is naive, dismissive, and wrong. Stock value increases are coming from optimizations within companies that reduce employee benefits and compensation. On the consumer side of things, profits also come from taking advantage of deregulation, lowering the quality and safety of consumer products and services. Executive leadership and investors are pocketing gains made from making everyone else's lives worse. Getting richer has a strong relationship with making others poorer.
  - newmanships 9y ago
    Are you saying stock value increases only come from reducing employee benefits and compensation or from lowering the quality and safety of products and services? Seems like that is simply not true across the board. If a company sells say software they could easily grow revenue and profits without changing their product or reducing employee benefits and compensation. Their earnings would be higher and their stock would go up.
  - ericd 9y ago
    How much of this opinion is coming from being involved in the management of companies vs news articles tuned to generate outrage so that they can generate clicks?
    - jumsdogpetter 9y ago
      How much of your denial comes from benefiting from the immiseration of the poor?
      - ericd 9y ago
        I'm serious. Do you have first hand knowledge of what you speak, or are you just looking for someone to be angry at? Also, looking at your comment history, you've literally only ever commented on the misery of the proletariat and related topics, which makes me suspect this is an astroturfing account.
  - AnimalMuppet 9y ago
gbacon 9y ago
The notion that wealth is a fixed-size pie is central to the long-debunked economic error known as mercantilism.
foobarian 9y ago
In real terms this could happen if productivity increased, and was able to lead to increased standard of living for everyone. This probably did happen for some large subset of the population, by some definition of "standard of living."
poke111 9y ago
The central idea of capitalism is that voluntary exchange enriches both parties. So the answer to your first question is yes.
- sametmax 9y ago
  This assumes the exchange is symmetric, and that enrichment only happens with exchanges. Neither of these are true.
  - wskinner 9y ago
    It doesn’t have to be symmetric. If there is $2 consumer and $4 producer surplus, both parties benefit. And just because enrichment, as you call it, can happen other ways than exchange, does not mean it doesn’t happen via exchange too.
    - dragonwriter 9y ago
      If it is asymmetric, the superficially apparent mutual gain may be illusory, because—while many people think for moral or aesthetic reasons that this should not be the case—there is enormous empirical evidence that the actual experience of utility related to material position is very strongly driven by relative material position, which is often far more significant than absolute material position.
      - Banthum 9y ago
        Parent is saying that it's better if everyone gets richer, even if some get more richer than others. So you're saying that it would be better if everyone was poorer individually, as long as they were more equally poor?
        grasshopperpurp 9y ago
        >So you're saying that it would be better if everyone was poorer individually, as long as they were more equally poor? Why are you creating this either/or? Are you proposing that if we don't allow people like Gates and the Kochs to hoard billions of dollars that everyone will be poorer individually?
ghostbrainalpha 9y ago
Yes it is possible for everyone's wealth to increase. In the year 1900 Global GDP was 1 Trillion. Today it is 77 Trillion. https://en.wikipedia.org/wiki/Gross_world_product https://en.wikipedia.org/wiki/Gross_world_product In Layman's the Global Pie is growing. The number of people living in extreme poverty has fallen DRASTICALLY over the last 25 years. https://twitter.com/humanprogress/status/913901718823489538 https://twitter.com/humanprogress/status/913901718823489538 So the people with the smallest piece of the pie are slowly getting a larger piece, but the people who already have the biggest piece of pie are getting even bigger pieces faster. But because the pie is growing, it doesn't mean that their larger piece is making someone else get a smaller piece. The only people who have a proportionally smaller piece than they used to are in the middle class. Which is what happens when first world work more closely with developing nations. Taking more people out of extreme poverty but putting slight downward pressure on the middle class.
- mtgx 9y ago
  Even if it did increase, most of that increase is just inflation anyway. And it's usually the wealthy that benefit from inflation (at least more than regular people do).
  - JumpCrisscross 9y ago
    > it's usually the wealthy that benefit from inflation Inflation is a regressive feature of modern currencies. It transfers wealth from lenders to borrowers and away from investors. The degree to which it does so is a function of the amount of wealth one has.
  - ghostbrainalpha 9y ago
    Compare the "regular" person of today to the "regular" person of 50 years ago. Is it easier or harder to afford basic foodstuffs? Do they eat out (luxury) more or less? If they own a home, is it larger or the same size? Who travels more? Who has better healthcare? Who spends more on entertainment? How much do they spend on the family pet? Who spent more time furthering their education? All of these are measures of wealth, and the modern "regular" person would be wealthier in every one of these categories. And that's not even factoring in advances in technology that make the quality of life of a person better even if there share of societal wealth goes down.
olalonde 9y ago
Yes, it is definitely possible and expected. Your line of reasoning is a pretty common one and is sometimes referred to as the "zero-sum fallacy" or "fixed pie fallacy"[0]. [0] http://www.aei.org/publication/the-fixed-pie-fallacy/ http://www.aei.org/publication/the-fixed-pie-fallacy/
obastani 9y ago
As many other commenters have pointed out, it is possible for net global wealth to increase (e.g., the increase in total real GDP). As far as I understand, the main reason this is possible is the development of new "technology" -- in the very general, economic sense of the word technology [0], which includes anything that increases the productivity of a single worker; this can include everything from new technology in the traditional sense to new processes (e.g., agile vs. waterfall for software development, or more optimal supply chains) and investment in infrastructure (e.g., better road networks). For example, a single farmer today can not only produce many times more crop compared to a farmer 100 years ago, but also safely and efficiently distribute this produce to consumers across the globe. In general, assuming everyone in the economy works equally hard, the total production (i.e., the global net wealth) can increase as long as technology is increasing. [0] https://en.wikipedia.org/wiki/Production_function https://en.wikipedia.org/wiki/Production_function
ericd 9y ago
If I fix your bike, and in exchange, you fix my bike, we're both richer in material terms than we were before.
eeZah7Ux 9y ago
> Is it possible for everyone’s wealth to increase? Numerically, yes. Psychologically and socially it's completely different. As inequality rises, people whose wealth increases more slowly are effectively poorer in relative terms.

eximius 9y ago

While a technically valid criticism, is it really that controversial? Costs are increasing faster than wages at low income levels - which is easy when wages are largely stagnant or declining due to increased competition driven by labor surplus and automation.

ptaipale 9y ago
It's not even controversial, it's wrong. Poverty, particularly extreme poverty, has been decreasing rapidly over the past 25 years. Of course, this doesn't mean that everyone is better; there are always winners and some losers, and there are setbacks here and there, but the big picture is one of great progress. For more, one should read the Human Development Reports: http://hdr.undp.org/sites/default/files/2016_human_development_report.pdf http://hdr.undp.org/sites/default/files/2016_human_developme...
- aalleavitch 9y ago
  This is true for worldwide poverty. This is not true for US poverty.
  - oreo81 9y ago
    In the US "poverty" now includes access to netflix. Poverty has absolutely gotten better in the US over the years.
    - ABCLAW 9y ago
      Poverty also includes having your neighborhood torn apart by junkies on opioids. But I guess actually looking at the econometric data to compare apples to apples isn't worthwhile because you can stay indoors while your tires are stolen and watch Jessica Jones, so things are better than they used to be, right?
      - oreo81 9y ago
        Yes things are better than they used to be. People living in bad neighborhoods spending time and money on entertainment need to prioritize better.

rstoj 9y ago

Good point - I wonder where that comes from, can anyone find a reference? In any case, their wealth is increasing at a much higher rate of 23% compared with the world GDP increase of 2.4% and US' GDP increase of 1.5% (https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2016&start=1961&view=chart https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?end=2...).

lhkdfsakhljd 9y ago
Yeah, but paper tigers like Zuckerberg are on that list. The top 1500 richest includes the twiddly twins and their bitcoin empire. They're all one tech bubble bursting from loosing most of their wealth.
- sametmax 9y ago
  The same kind of rich people has existed for ever. It's fair to always take them in consideration.

coliveira 9y ago

The issue is simple to understand: as population grows and technology grows even faster, there should be a steady stream of wealth increase. This has been observed as is obvious to everyone. However, if we allow the bulk of this wealth to be controlled by a tiny part of the population, we are creating a huge problem to current and to future generations. A hereditary oligarchy can be terrible to our civilization, and this is what we see forming nowadays. I am not against people participating in the creation of wealth and reaping the rewards, but these differences in wealth need to be leveled over time. Unfortunately, short-sighted politics of the US and other countries are giving more and more power to wealthy people so that they can amass more money without visible contributions to society.

charlesdm 9y ago
Maybe. I don't want this to come off bad, but maybe the work a lot of people do just isn't that important and thus doesn't warrant increases in salary? If a company needs someone to do X, and 5 viable candidates can be found for $Y -- there really is no reason to increase wages. Anyone with some capital could've invested in Netflix, Facebook or Google several years ago and would have achieved a good return on their money. Even if some sort of global wealth tax would be introduced (that's a big IF) to fix the accumulation of extreme wealth, would people be better off? The amounts collected, spread out over the entire population, would be relatively small. And most of this new wealth is mostly paper wealth -- the headline next year could very well be: "World's richest lost $3tn of their wealth".
- nofilter 9y ago
  How well does that argument hold up tho'? I mean, there is always _someone_ who does it cheaper. Always. In fact I know of a web developer, who actually does quite decent work and is available for as little as $5 per hour. Does that mean everyone in that skill level should get paid so little?
  - charlesdm 9y ago
    Cheaper yes, but perhaps not better. I'd be happy to demand a few million a year for high quality development work from an employer, but the laws of supply and demand do apply.

jondubois 9y ago

You don't need any data to support that fact, any regular person can see for themselves that this is true just by looking at their own situation and that of their family members, friends, neighbors and acquaintances.

krona 9y ago

The richest have gotten richer To be exact, it seems to be saying that the richest 500 are x% richer at the end of the year, not that the 500 richest at the beginning of the year are %x richer at the end of it. These are two different things because they are two different sets of people. In decades past the richest and the poorest people don't remain in that part of the income distribution very long; this is especially true in the US.

bitwize 9y ago
Actually, it's especially false in the US, because social mobility is so poor for such a "free" state.
- krona 9y ago
  From 2001 to 2007 (just 6 years), the proportion of US households that left their income quintile were (starting at the lowest quintile) 44%, 61%, 58%, 55%, and 34%. Even by global standards that's quite high income mobility.
  - addicted 9y ago
    The choices of year bounds are interesting to say the least.
    - ChrisLomont 9y ago
      Those changes are about the same for any window of the same time length for all of recent US history. St. Louis FRED has data and papers on this. One of the best studies on intergenerational mobility in the US, using all IRS records (not sure how hard they had to work to get those) shows that mobility in the US has been fairly constant for 50+ years. [1] http://www.equality-of-opportunity.org/assets/documents/mobility_trends.pdf http://www.equality-of-opportunity.org/assets/documents/mobi...
pg314 9y ago
> These are two different things because they are two different sets of people. The sets mostly overlap. The top 10 of the richest people was the same in 2016 and 2017 [1]. These 10 people saw their net worth increase by $107 billion. [1] https://en.wikipedia.org/wiki/The_World%27s_Billionaires#2017 https://en.wikipedia.org/wiki/The_World%27s_Billionaires#201...

aalleavitch 9y ago

Wages have stagnated and the poor are not seeing an equivalent increase in their wealth. Moreover, while the jobs numbers are very high 94% of all jobs added in the last decade have been temp/contract work/self-employment. https://hbr.org/2017/10/why-wages-arent-growing-in-america https://hbr.org/2017/10/why-wages-arent-growing-in-america https://www.vox.com/policy-and-politics/2017/8/8/16112368/piketty-saez-zucman-income-growth-inequality-stagnation-chart https://www.vox.com/policy-and-politics/2017/8/8/16112368/pi... https://qz.com/851066/almost-all-the-10-million-jobs-created-since-2005-are-temporary/ https://qz.com/851066/almost-all-the-10-million-jobs-created...

closeparen 9y ago
We set up an incentive scheme to vigorously punish employers for offering full time work by loading it down with obligations over the worker’s long term well being, and didn’t do anything similar for temp/contract work. What were you expecting? If we attached proportional responsibility to part time work, or just provided benefits out of the public purse instead of labor law, part time work wouldn’t be such an obviously superior choice to employers.
cornholio 9y ago
On the other hand, the wages of 700 million Chinese workers has trebled in the last decade.
- oblio 9y ago
  And humanity, as a whole, will probably reap a ton of long term benefits from it. I doubt there's much solace in this thought for someone being fired because of it, though. (Personally I don't mind a bit of hardship if it helps everyone, but I understand not everyone can be frugal or that some people can be just plain unlucky)
  - aalleavitch 9y ago
    It's also a lot harder to swallow when you're hungry and someone out there is making enough to feed 100 of you.

11thEarlOfMar 9y ago

Indeed, according to World Bank, the number of people living in poverty is decreasing. % from 1820 - 2015: https://ourworldindata.org/slides/world-poverty/#/declining-world-poverty-1820-2015-step2 https://ourworldindata.org/slides/world-poverty/#/declining-... Distribution 1988: https://ourworldindata.org/slides/world-poverty/#/Global-Income-Distribution-1988 https://ourworldindata.org/slides/world-poverty/#/Global-Inc... Distribution 2011: https://ourworldindata.org/slides/world-poverty/#/Global-Income-Distribution-2011 https://ourworldindata.org/slides/world-poverty/#/Global-Inc...

dclowd9901 9y ago

If you're burying your head in the sand, you're missing the headlies that wages have been stagnant for decades.

umeshunni 9y ago
Nearly a billion people have been pulled out of poverty in India and China over the last 25 years. Their wages have at least tripled on average in real terms in the last 20 years. So, it's you who's burying your head in the "America first" sand. The middle class in the US had enjoyed the fruits of global inequality resulting from colonialism and WW2 during the second half of the 20th century. As the gap in skills and education between the average American and the rest of the world have disappeared, the former US middle class will see their income gap with the rest of the world also disappear. A teacher, factory worker or a store clerk in the US isn't 20x more productive than a teacher, factory worker or a store clerk in India or China and there's not reason for that wage gap to exist any more.
- oblio 9y ago
  Yeah, but things might not go swimmingly. We will see violence, protectionism, plain old isolationism rise. The developed countries are still developed and their citizens will fight back.
- dclowd9901 9y ago
  Are you really sitting here and telling me that people merely being brought out of destitution is progress? We have far different views on progress.
  - ptaipale 9y ago
    I am not entirely sure if you are trolling. People being brought out of destitution is progress, absolutely. It's the very first and most important step of progress. If people don't have enough to eat, even their brain won't develop properly. The lower layers of Maslow hierarchy are absolutely essential. After that, more progress is needed, but having food, essential health and physical security is definitely the fundamental thing for any other types of progress, such as education.

Mikeb85 9y ago

As the wealth gets more concentrated at the top, the wealth 'share' of poorer people declines even if their wealth nominally rises.

dbingham 9y ago

It's a pretty well understood and accepted fact at this point. It's been a major talking point in economic and political circles for the past 5 - 10 years. The sources below are from a quick Google search. They mostly reference income stagnation and are about the US. But income stagnation leads to wealth stagnation and there are similar trends world wide. Thomas Picketty's Capital in the 21st Century is largely about this issue, as is Robert Reich's documentary Inequality for All. There are those who challenge the conclusions drawn in both, but few seriously contest the data they point to. [1] http://www.epi.org/publication/charting-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/ [2] https://www.npr.org/sections/money/2014/10/02/349863761/40-years-of-income-inequality-in-america-in-graphs https://www.npr.org/sections/money/2014/10/02/349863761/40-y... [3] https://www.economist.com/blogs/freeexchange/2013/09/incomes https://www.economist.com/blogs/freeexchange/2013/09/incomes [4] http://www.nytimes.com/2013/01/13/sunday-review/americas-productivity-climbs-but-wages-stagnate.html http://www.nytimes.com/2013/01/13/sunday-review/americas-pro...

rayiner 9y ago

That claim is not only unsupported, it's almost certainly false. The last few decades haven't been great for the middle class in wealthy countries, but it's been fantastic for "poorer people across the world." U.S. GDP per capita is up 60% since 2000. Bangladesh's is up 235%. India is up 288%. Thailand is up 195%. Poorer countries that have been able to cobble together enough rule of law to participate in capitalism have benefited tremendously from it.

andai 9y ago
GOAL 1: ERADICATE EXTREME POVERTY & HUNGER Target 1.A: Halve, between 1990 and 2015, the proportion of people whose income is less than $1.25 a day The target of reducing extreme poverty rates by half was met five years ahead of the 2015 deadline. More than 1 billion people have been lifted out of extreme poverty since 1990. In 1990, nearly half of the population in the developing regions lived on less than $1.25 a day. This rate dropped to 14 per cent in 2015. http://www.un.org/millenniumgoals/poverty.shtml http://www.un.org/millenniumgoals/poverty.shtml