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“What if the governments of the developed world turned to their electorates and explicitly said this was the deal? The pitch might go something like this: we’re

“What if the governments of the developed world turned to their electorates and explicitly said this was the deal? The pitch might go something like this: we’re living in a competitive global system, there are billions of desperately poor people in the world, and in order for their standards of living to improve, ours will have to decline in relative terms.” This is a guaranteed losing platform

dbatten 8y ago
It's also preposterous. Wealth isn't a zero-sum game. Compared to our ancestors in, say, 1000 BC, the vast majority of humanity is far, far, wealthier while the few who are arguably no better off are not worse off either. That's all wealth we've created. We can talk about whether it's a good or moral idea to transfer wealth, but let's not pretend like that's the only way to deal with poverty.
- ionised 8y ago
  > Wealth isn't a zero-sum game I keep seeing people say this but is there not a finite amount of wealth in the world at any given time? There are also the finite land and natural resources required for wealth creation.
  - fullshark 8y ago
    There's also human ingenuity, technology, and gov't stability which are multipliers on those finite land/natural resources. Skyscrapers increase real estate/land for example, courts protect property rights enabling one to invest capital in venture X.
- dragonwriter 8y ago
  > Wealth isn't a zero-sum game. It expressly refers to relative, not absolute, wealth, which necessarily is zero-sum. (There's also quite a lot of evidence that relative, not absolute, wealth is the more important driver of exoerienced utility: humans are strongly programmed to be satisfied or not based on performance relative to expectations set by social environment, not absolute material condition. For this reason relative wealth is generally more important.)
- rohit2412 8y ago
  I've never understood this argument. Sure, wealth/trade isn't a zero sum game. That means that the net wealth in the system increases. But that doesn't mean each individual participant in the game is better off. The game night have a large competition component (which is zero sum) and would mean that the participants are not better off.
bequanna 8y ago
Exactly, this is where he lost me. The pitch is incredibly naive. If the latest presidential election in the US has taught us anything it should be that middle class people with stagnating wages couldn’t care less about the troubles of the worlds poor.
- geggam 8y ago
  Pretty sure you can say that about most folks. We tend to run on the selfish side as a species.
- emodendroket 8y ago
  The argument is kind of two-pronged and would involve wealth transfers from the rich to the middle and lower class. Heard anyone railing about elites lately?
  - bequanna 8y ago
    It just won't work. The middle class doesn't see themselves as net beneficiaries in wealth transfers, so you have to completely rewire their thinking. Also, roughly 50% of the country isn't interested in any additional taxation, period. They don't care if you try to tell them how they will benefit because they see themselves as the aspiring rich. Finally, the goal is of this policy is to increase taxation of the top x%. The same people with armies of lobbyists and the majority of politicians (GOP or DFL) already in their pockets. Good luck.
    - dragonwriter 8y ago
      > (GOP or DFL) Unless you are specifically talking about Minnesota state politics, the two major parties are not the Republican Party (nickname “Grand Ole Party”, or GOP for short) and the Democratic-Farmer-Labor Party (DFL for short.)
    - emodendroket 8y ago
      > Finally, the goal is of this policy is to increase taxation of the top x%. The same people with armies of lobbyists and the majority of politicians (GOP or DFL) already in their pockets. Good luck. Well "nothing can ever get better" doesn't sound like much of a winner either.
emodendroket 8y ago
I think if you finish reading that part to the end it seems much more reasonable. Cutting him off seems unfair. To wit: > Perhaps we should accept that on moral grounds: we’ve been rich enough for long enough to be able to share some of the proceeds of prosperity with our brothers and sisters. I think I know what the answer would be. The answer would be OK, fine, but get rid of the trunk. Because if we are experiencing a relative decline why shouldn’t the rich – why shouldn’t the one per cent – be slightly worse off in the same way that we are slightly worse off?
- jandrewrogers 8y ago
  The problem is that the economic argument is nonsensical unless you significantly raise taxes on people who are not in the 1%, as the amount of potential revenue involved is a pittance. At least in the US, only 20% of the population pay net taxes (tax payments minus transfers from all sources), so even if you raised effective tax rates to 100% on the upper few percent, ignoring the immediate collapse of that tax revenue, the amount of new revenue would be underwhelming. For the US, the policy challenge is that the distribution of net tax payers is significantly more biased toward the top end of the income range than in many countries in Europe (i.e. it is more progressive, ironically). There is no practical way to sustainably raise substantial tax revenues without expanding the number of people who pay net taxes. This means substantially raising taxes in the 2nd (60-80%) quintile, who have five-figure household incomes on average, and probably the 40%-60% quintile as well. Any definition of "rich" that could generate substantial net tax revenue is going to come significantly out of the pockets of the middle class. Convincing someone earning $90k in California that they are so wealthy that they should downgrade their lifestyle would be an unenviable task for a politician.
  - mcguire 8y ago
    The economic effect is occurring. See the chart towards the end of the article. "From another perspective, the story of the last ten years has been one of huge success. At the time of the crash, 19 per cent of the world’s population were living in what the UN defines as absolute poverty, meaning on less than $1.90 a day. Today, that number is below 9 per cent. In other words, the number of people living in absolute poverty has more than halved, while rich-world living standards have flatlined or declined." The proposal is to make the effect explicit rather that political populism of trying to reverse the current trend for those at point B in the chart.
dragonwriter 8y ago
Yeah, a better expression would be: “There a billions of desperately poor people in the world, and in order for them not to have a strong interest in either immigrating into the developed world by any means necessary or smashing the international order, both of which produce adverse consequences that was have to deal with, their relative standard of living must improve, which also had costs for the developed world, but much less than continuing to deal with the consequences of the current level of structural inequality.”
- mrguyorama 8y ago
  That's a lot of words that people still don't want to hear

dbatten 8y ago

It's also preposterous. Wealth isn't a zero-sum game. Compared to our ancestors in, say, 1000 BC, the vast majority of humanity is far, far, wealthier while the few who are arguably no better off are not worse off either. That's all wealth we've created. We can talk about whether it's a good or moral idea to transfer wealth, but let's not pretend like that's the only way to deal with poverty.

ionised 8y ago
> Wealth isn't a zero-sum game I keep seeing people say this but is there not a finite amount of wealth in the world at any given time? There are also the finite land and natural resources required for wealth creation.
- fullshark 8y ago
  There's also human ingenuity, technology, and gov't stability which are multipliers on those finite land/natural resources. Skyscrapers increase real estate/land for example, courts protect property rights enabling one to invest capital in venture X.
dragonwriter 8y ago
> Wealth isn't a zero-sum game. It expressly refers to relative, not absolute, wealth, which necessarily is zero-sum. (There's also quite a lot of evidence that relative, not absolute, wealth is the more important driver of exoerienced utility: humans are strongly programmed to be satisfied or not based on performance relative to expectations set by social environment, not absolute material condition. For this reason relative wealth is generally more important.)
rohit2412 8y ago
I've never understood this argument. Sure, wealth/trade isn't a zero sum game. That means that the net wealth in the system increases. But that doesn't mean each individual participant in the game is better off. The game night have a large competition component (which is zero sum) and would mean that the participants are not better off.

bequanna 8y ago

Exactly, this is where he lost me. The pitch is incredibly naive. If the latest presidential election in the US has taught us anything it should be that middle class people with stagnating wages couldn’t care less about the troubles of the worlds poor.

geggam 8y ago
Pretty sure you can say that about most folks. We tend to run on the selfish side as a species.
emodendroket 8y ago
The argument is kind of two-pronged and would involve wealth transfers from the rich to the middle and lower class. Heard anyone railing about elites lately?
- bequanna 8y ago
  It just won't work. The middle class doesn't see themselves as net beneficiaries in wealth transfers, so you have to completely rewire their thinking. Also, roughly 50% of the country isn't interested in any additional taxation, period. They don't care if you try to tell them how they will benefit because they see themselves as the aspiring rich. Finally, the goal is of this policy is to increase taxation of the top x%. The same people with armies of lobbyists and the majority of politicians (GOP or DFL) already in their pockets. Good luck.
  - dragonwriter 8y ago
    > (GOP or DFL) Unless you are specifically talking about Minnesota state politics, the two major parties are not the Republican Party (nickname “Grand Ole Party”, or GOP for short) and the Democratic-Farmer-Labor Party (DFL for short.)
  - emodendroket 8y ago
    > Finally, the goal is of this policy is to increase taxation of the top x%. The same people with armies of lobbyists and the majority of politicians (GOP or DFL) already in their pockets. Good luck. Well "nothing can ever get better" doesn't sound like much of a winner either.

emodendroket 8y ago

I think if you finish reading that part to the end it seems much more reasonable. Cutting him off seems unfair. To wit: > Perhaps we should accept that on moral grounds: we’ve been rich enough for long enough to be able to share some of the proceeds of prosperity with our brothers and sisters. I think I know what the answer would be. The answer would be OK, fine, but get rid of the trunk. Because if we are experiencing a relative decline why shouldn’t the rich – why shouldn’t the one per cent – be slightly worse off in the same way that we are slightly worse off?

jandrewrogers 8y ago
The problem is that the economic argument is nonsensical unless you significantly raise taxes on people who are not in the 1%, as the amount of potential revenue involved is a pittance. At least in the US, only 20% of the population pay net taxes (tax payments minus transfers from all sources), so even if you raised effective tax rates to 100% on the upper few percent, ignoring the immediate collapse of that tax revenue, the amount of new revenue would be underwhelming. For the US, the policy challenge is that the distribution of net tax payers is significantly more biased toward the top end of the income range than in many countries in Europe (i.e. it is more progressive, ironically). There is no practical way to sustainably raise substantial tax revenues without expanding the number of people who pay net taxes. This means substantially raising taxes in the 2nd (60-80%) quintile, who have five-figure household incomes on average, and probably the 40%-60% quintile as well. Any definition of "rich" that could generate substantial net tax revenue is going to come significantly out of the pockets of the middle class. Convincing someone earning $90k in California that they are so wealthy that they should downgrade their lifestyle would be an unenviable task for a politician.
- mcguire 8y ago
  The economic effect is occurring. See the chart towards the end of the article. "From another perspective, the story of the last ten years has been one of huge success. At the time of the crash, 19 per cent of the world’s population were living in what the UN defines as absolute poverty, meaning on less than $1.90 a day. Today, that number is below 9 per cent. In other words, the number of people living in absolute poverty has more than halved, while rich-world living standards have flatlined or declined." The proposal is to make the effect explicit rather that political populism of trying to reverse the current trend for those at point B in the chart.

dragonwriter 8y ago

Yeah, a better expression would be: “There a billions of desperately poor people in the world, and in order for them not to have a strong interest in either immigrating into the developed world by any means necessary or smashing the international order, both of which produce adverse consequences that was have to deal with, their relative standard of living must improve, which also had costs for the developed world, but much less than continuing to deal with the consequences of the current level of structural inequality.”

mrguyorama 8y ago
That's a lot of words that people still don't want to hear