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On a global level, the rich have gotten richer, but the poor have gotten a LOT richer. Three decades ago, as a kid in Eastern Europe, I could taste oranges once
by credit_guy 8y ago
On a global level, the rich have gotten richer, but the poor have gotten a LOT richer. Three decades ago, as a kid in Eastern Europe, I could taste oranges once a year, at Christmas time, with some skipped years here and there. Now everybody can eat as much as they can, and obesity is a growing problem. Maybe you don’t care that much about the world outside the US or Western Europe, but literally billions of people have seen their living standards rise from the subsistence level to a decent level.
- ejstronge 8y agoI think there are a couple of intertwined ideas in your comment. I wonder if your observations could be explained by decreases in the cost of food / increased food distribution. Secondly, it's not clear whether wealth has improved for poor people (something I should take a look at...).
- achompas 8y agoIt's well known that folks in the lower 70% of global income have seen significant growth. There's even a name for the plot - "the elephant chart." https://avc.com/2016/08/elephant-chart/ https://avc.com/2016/08/elephant-chart/ The chart, as I understand it (in limited reading), tracks three phenomenon: 1. Increasing wealth formation by more disadvantaged groups in non-first world countries (the "body" of the elephant). 2. Wealth stagnation for middle classes in first-world countries (the "dip" in the elephant's trunk). 3. Increasing returns to capital held by upper classes in first-world countries (the "trunk" of the elephant).
- mikk14 8y agoI think that the elephant chart can be misleading. A 100% growth of very little is still very little. I found this version [1] showing that, in absolute terms, the gaps are actually increasing. [1] https://patternsofmeaning.files.wordpress.com/2018/05/elephant-graph-from-skitch.jpg?w=863 https://patternsofmeaning.files.wordpress.com/2018/05/elepha...
- aoeusnth1 8y agoIs a that very useful way of understanding growth? Without any change in the income distribution, everyone getting 1% richer would increase the absolute gap by 1%.
- xg15 8y agoThat seems about right. "Getting 1% richer" would imply something completely different for a billionaire than for a worker, so I don't see why it would be a useful measure.
- aoeusnth1 8y agoBecause economies growing or shrinking generally affects people proportional to their wealth (including human capital). To me, Gini curves seem far more effective for understanding the dynamics of inequality than looking at absolute differences, which largely change due to economic growth.
- xg15 8y agoYes, that's true when talking about causes of a wealth gap, but this thread was about effects. A growing absolute wealth gap can still lead to reduced quality of life for lower-wealth groups - e.g. because prices rise faster than their incomes and so they effectively lose access to certain goods. It will also increase inequality and makes other economic measures (that rely on the mean) less reliable. Just because an effect is always present, doesn't mean you can ignore it, especially if doing so would flip the conclusion. Posting the elephant graph as an argument that all is going well would do exactly that.
- mikk14 8y agoI'm not sure I understand this rebuttal, do you want to expand a bit? Everyone getting 1% richer would not affect the Gini nor the absolute gap, or at least not as much as you imply. So I must be missing something. In any case, you are not necessarily addressing my rebuttal of the elephant graph. What I'm saying is that the elephant graph is an interesting conversation starter, but, by itself, it does not convey enough information to make a conclusion about fairness. To make an extreme example, if I have literally $0 last year and I have $1 now, my growth rate in the elephant graph is infinitely higher than the richer 1%. I'm still going to starve to death, though. Absolutes matter.
- RyanZAG 8y agoIn terms of poverty, is there a difference between getting more wealth vs everything becoming cheaper? I don't think there is - your life has improved just the same either way. Fixating on silly numbers that ultimately mean nothing doesn't seem like a good way to make the world better. We should look at concrete things - and how often you can eat an orange is the kind of concrete thing that really matters.
- BrainInAJar 8y ago> In terms of poverty, is there a difference between getting more wealth vs everything becoming cheaper? Yes. The delta between the richest and poorest indicates a lot of things about a society.
- RyanZAG 8y agoWhat does it indicate? You can go to a place like Mauritius where the delta is enormous, but everyone is pretty happy and the rich and poor mingle freely. Or you can have a place like France where the delta is far smaller, but the rich and poor detest each other and very rarely mingle.
- adamsea 8y agoIn 2014 The Gini coefficient for Mauritas was 30 and for France it was 40. The top 1% in France has about 20% of the total income as of 2014. For Mauritas no suitable data was found for wealth inequality or dispersion of earnings. The lack of good data for Mauritas makes a comparison between the two questionable. Plus even after looking at the numbers for these countries I would want to check out money laundering - if I recall, based on the Panama papers, a nontrivial amount of the 1% (probably more like the 0.1%s) wealth is laundered/hidden/dark. I don’t know if the studies here attempt to account for that or not. I would imagine money laundering is prevalent in France (or any major economy for that matter), possibly in Mauritas https://www.chartbookofeconomicinequality.com/inequality-by-country/mauritius/ https://www.chartbookofeconomicinequality.com/inequality-by-... https://www.chartbookofeconomicinequality.com/inequality-by-country/france/ https://www.chartbookofeconomicinequality.com/inequality-by-... Information on data sources here - https://www.chartbookofeconomicinequality.com/about/ https://www.chartbookofeconomicinequality.com/about/ As of 2018 the population of Mauritas is 1.26 million (via google search). The 2018 population of France is 65.23 million (via google search). The 2014 population probably was not radically different. I wonder if the size of the society in question matters here - is comparing a country to one 65 times larger than it useful? I did not look for data to validate the hypothesis that everyone is pretty happy in Mauritas as opposed to France.
- MasterPI 8y agoI think this had more to do with the Iron Curtain than poverty.
- untog 8y ago> Maybe you don’t care that much about the world outside the US or Western Europe I don't think that's a fair reaction. It's possible to care about the rest of the world and recognise context. Workers looking for greater bargaining power in the US shouldn't accept "but things are much better in Eastern Europe these days" as a reason for them to not organise - the two are entirely separate issues, and can happen independent of each other.
- andy_ppp 8y agoYes. Clearly my comment relates to the article which I believe is talking about pay and conditions in the West.
- bzbarsky 8y agoThey're not entirely separate issues. One of the big reasons for rising living standards in the rest of the world has been the offshoring of work from the US and Western Europe, which is also one of the things reducing worker bargaining power.
- s2g 8y agoBut it's got nothing to do with the decimation of unions and the rise of more and more worker hostile policies in general.
- bzbarsky 8y agoIt's not entirely unrelated. It's easier to get away with worker hostile policies for an employer when the employer's option if workers object is not "no workers" but "I guess I have ti shift production to China". You're right that it's not directly related to the decimation of unions. That has other things going on, and different things in different sectors.
- ishjoh 8y agoI think they are related. If a factory is in the US, and unions drive cost of employment higher, then the factory owners look to move the factory overseas to be more competitive. Now it's important that we also recognize that the factory owners also have to be competitive in a global landscape and against new entrants into the market, new entrants that can spring up from countries where the cost of employment is much less, so they have a strong incentive to move factories when costs rise. Now at its disposal, a government can implement tariffs and protectionism to level the playing field, but those can have disastrous long term effects (see the history of India's protectionism). So, an excellent way for wages to rise is to make employees extremely efficient, and to increase the demand in labor. Make no mistake though, the gains in other countries have effected US and European workers.
- intended 8y agoI think this is a red herring. I’m from one of those places where things have gotten much MUCH better - not an American. The absolute improvement is great. The accelerated concentration of Wealth is not. The term economists have now settled on and are considering is the very mundane “lack of social mobility” It’s a problem.
- enraged_camel 8y ago>>The absolute improvement is great. The accelerated concentration of Wealth is not. Yes, exactly. The reason actually is very simple: wealth inequality results in inequality in political (not to mention legal) representation, as the wealthy always carry more influence in society and use that influence to stack the odds in their own favor.
- travmatt 8y agoI definitely agree that it’s a red herring - the majority of people are going to judge their position relative to the world around them, not to some time 30-40 years ago. It’s pretty much the same line parents use on their children - I don’t think it works for them, much less adults.
- myth_drannon 8y agoThat's more to do with a better food distribution network. The fact that you ate mostly locally grown food and not imported from far away places didn't make you poor. You had to really try to be poor and hungry in USSR. The collapse of communism and diminished threat of proletariat revolution in western countries is what driving the inequality in the past 30 years ("the rich are getting bolder").
- simula67 8y agoWhat in God's name are you talking about ? USSR saw a massive famine in 1932-1933 [1] believed to be caused directly by communist policies [1] https://en.m.wikipedia.org/wiki/Soviet_famine_of_1932–33 https://en.m.wikipedia.org/wiki/Soviet_famine_of_1932–33
- watwut 8y agoHe talks about later stages of communism. There was no famine in 1970 or 1980.
- myth_drannon 8y agoThat's controversial who caused what, the wikipedia link actually discusses it. It's like saying the Wall Street bankers caused the famine in USA in 30's. Too much propaganda and subversion on this topic.
- simula67 8y agoThe discussion points to Soviet policy. You are invoking fallacy of the gray [1] with your comparison to the dust bowl [1] https://wiki.lesswrong.com/wiki/Fallacy_of_gray https://wiki.lesswrong.com/wiki/Fallacy_of_gray
- adamsea 8y agoThere does not appear to be much data supporting the hypothesis that a significant number of people died of malnutrition (ie a famine) in the US during the Great Depression: https://history.stackexchange.com/questions/12297/how-many-people-in-the-us-starved-to-death-during-the-great-depression https://history.stackexchange.com/questions/12297/how-many-p... The millions of deaths (irrespective of the famines ultimate cause) in the USSR and especially in the Ukraine in 1932 / 1933 are well documented (2-4 million deaths estimated): https://en.m.wikipedia.org/wiki/Soviet_famine_of_1932%E2%80%9333 https://en.m.wikipedia.org/wiki/Soviet_famine_of_1932%E2%80%... There was also a Russian famine in 1922 where an estimated 5 million people died: https://en.m.wikipedia.org/wiki/Russian_famine_of_1921%E2%80%9322 https://en.m.wikipedia.org/wiki/Russian_famine_of_1921%E2%80... There is a Wikipedia article on “hunger in the United States”, but a google search for “United States Great Depression famine” did not return any Wikipedia articles documenting a famine in the US at that time, only the above Stack Exchange discussion (which appears to reject the hypothesis). FYI: https://en.m.wikipedia.org/wiki/Hunger_in_the_United_States https://en.m.wikipedia.org/wiki/Hunger_in_the_United_States Without data to back up the claim of a famine killing millions in the US during the Great Depression the comparison used here is nonsense, although there may be other evidence for the point the author was attempting to support.
- eurticket 8y agoObesity is growing because the cheap food is loaded with sugar while the healthier stuff is more expensive...
- tudelo 8y agoI can't agree that healthy food is necessarily expensive from the perspective of someone in the US. Chicken breast is regularly 1.99 a pound and thighs even cheaper. Canned food is ridiculously cheap, and frozen vegetables don't go bad and are no worse than fresh ones.
- scarface74 8y agoCanned food is usually higher in sodium.
- gowld 8y agoSodium is only unhealthy if you happen to have hypertsenion.
- scarface74 8y agoToo much sodium can cause hypertension. https://www.webmd.com/hypertension-high-blood-pressure/news/20150313/salt-may-be-bad-for-more-than-your-blood-pressure https://www.webmd.com/hypertension-high-blood-pressure/news/...
- sedachv 8y ago> Chicken breast is regularly 1.99 a pound and thighs even cheaper. Why are people trotting out chicken as an example of healthy food? It is anything but: https://www.huffingtonpost.com/2014/09/15/poultry-farms-antibiotics-chickens_n_5822438.html https://www.huffingtonpost.com/2014/09/15/poultry-farms-anti... https://www.youtube.com/watch?v=7rNY7xKyGCQ https://www.youtube.com/watch?v=7rNY7xKyGCQ
- ForRealsies 8y ago
- throwaway1982x 8y agoBy my understanding, global income inequality is improving but global wealth inequality is worsening: The conclusion that I draw is that while people broadly in this position might accurately perceive that they are now in a more comfortable short-term position than they were, they are at high risk in the medium-term and long-term.
- Terr_ 8y agoSounds like a case of https://en.wikipedia.org/wiki/Simpson%27s_paradox https://en.wikipedia.org/wiki/Simpson%27s_paradox
- s73v3r_ 8y ago"Now everybody can eat as much as they can" Not everywhere. "Maybe you don’t care that much about the world outside the US or Western Europe, but literally billions of people have seen their living standards rise from the subsistence level to a decent level." That's very uncivil of you. There is lots of poverty in the US, and despite popular opinion, there is lots of hunger here too.
- s2g 8y agoThat's nice for them. Doesn't do a single thing to address the point made.
- sizzle 8y agoCan this be attributed to advances in genetically modified plants yielding more fruit in less favorable conditions along with advances in logistics to get the fruit shipped from all over the world. I'm eating mangoes grown in Peru that I got off the shelf at my local grocery store.