6 ms·

To paraphrase Keyser Söze "The greatest trick the Super-Elite ever pulled was convincing the world that inequality is a desired outcome of a properly functioni

To paraphrase Keyser Söze "The greatest trick the Super-Elite ever pulled was convincing the world that inequality is a desired outcome of a properly functioning economy".

nostrademons 8y ago
I would think that the more straightforward paraphrase is even better: "The greatest trick the Super-Elite ever pulled was convincing the world that they didn't exist." I doubt you'd find many people who actually agree that inequality is a desired outcome of a properly functioning economy (even if it's true). However, the Super-Elite have been remarkably successful at disappearing into the background and making the world forget about them. Look at the headlines today: they're about ICE & undocumented immigrants, or Nazis in Charlottesville, or Russian interference, or antifa protesters. You see very few news stories about private jet vacations or the real-estate holdings of the super-wealthy.
- swframe2 8y ago
  I agree. The super wealthy prefer seclusion but it is hard to hide a 10 bedroom mansion and a superyacht. It is better to provide a strong "foxnews education" so there is no need to hide. Honestly, I wonder if a symbolic model would work better for our society. Ask the rich to set aside 20% of their wealth to provide low interest rate (~1% to 2%) loans to the poor to be used specifically on self-improvement (housing, infrastructure, education, policing, healthcare, childcare, etc). The loans start small and increase with good payment history.
  - prolikewh0a 8y ago
    >Ask the rich to set aside 20% of their wealth to provide low interest rate (~1% to 2%) loans to the poor to be used specifically on self-improvement (housing, infrastructure, education, policing, healthcare, childcare, etc). The loans start small and increase with good payment history. What you're suggesting would create more wealth for the elite. It's a loan, so they retain the same amount of money (since it's a loan, the assumption is that it's paid back), while gaining more money in interest. I am lower end of the spectrum when it comes to my wealth, and I probably can't even claim any sort of middle class "label" in the USA. I avoid debt (because I can't afford to pay it back) and wouldn't even consider something like this.
    - hakfoo 8y ago
      If the interest rate in the loan was pegged to track inflation, it should be roughly zero-practical-gain. But it's still clunky. There's no reason we can't say "people earning more than a few million dollars a year can afford to pay a 97% tax rate." We just need to have it wired together into a comprehensive plan. Hold passports if you have outstanding tax debt. Orchestrate "regime change" in Carribean tax shelters and Luxembourg instead of the Middle East for a change.
      - RhysU 8y ago
        > There's no reason we can't say "people earning more than a few million dollars a year can afford to pay a 97% tax rate." Sure there is. They won't bother creating any value if their marginal take is effectively zero. How hard would you work if someone said you couldn't take home more than $10K?
        prolikewh0a 8y ago
        Ideally there would be tax brackets so people making $150,000/year aren't taking home poverty wages, but people making $1,000,000,000/year are taking home maybe a couple tens of millions, which is still perfectly comfortable to live on for an entire lifetime.
        darawk 8y ago
        I think you're missing his point. Say your hypothetical person is making $10,000,000/year already. He has the opportunity to work 40% harder to 10x his income up to $100M/year. However, at this point, his marginal tax rate under your scheme is already 97%, which means that on that extra $90M in theoretical income, he will only take home an extra $2.7M. Now, it's not worth it for him to make that extra effort, to only increase his realized income by 27%. The next question is: Why should you, someone presumably not making $10m/year, care? We care because when someone increases their earnings from $10M to $100M, in theory, they are doing so by creating value for society. In fact the people at the highest ends of the income distribution should be the ones creating the most value. So we really do want them to be incentivized to earn more. To ensure that they are, we need a top marginal rate that strikes a balance between unnecessary super wealth, and incentivizing the value creation that drives the tremendous prosperity of the modern economy. This is a delicate balancing act, to be sure. But it is extremely important to understand that it is a balancing act.
  - xg15 8y ago
    > Ask the rich to set aside 20% of their wealth to provide low interest rate (~1% to 2%) loans... Instead of or in addition to taxes?
- edanm 8y ago
  > I doubt you'd find many people who actually agree that inequality is a desired outcome of a properly functioning economy (even if it's true). I don't agree (with your statement). I mean, I don't think most people actively begrudge people having a better situation than them - just like they don't sit around getting angry that Rachmaninoff is a better composer than them, or that Michael Jordan is a better basketball player. I think people do sometimes instinctively feel that one person having more wealth is somehow depriving them - but that's not universal, and only comes up in certain situations. > "The greatest trick the Super-Elite ever pulled was convincing the world that they didn't exist." > You see very few news stories about private jet vacations or the real-estate holdings of the super-wealthy. Like, I don't think you're actually claiming that there's any conspiracy here of the super-elite, despite the wording. But I don't get your point. You think it takes active work to make it so that there are no news stories about the super elite? I mean, I don't expect the newspapers in poorer countries to be filled with stories about how much better everyone in America has it. I don't think it's because Americans did anything special - it just doesn't really interest people. And again, I don't think everyone in Africa feels that the fact that most Americans are better off than them is necessarily so terrible. I think this sentiment tends to come up in certain situations (especially when explicitly talking about economic inequality), but not in general.
patkai 8y ago
Good one! Let me try another angle: the greatest trick is to cover up the simple fact that the redistribution of wealth is arbitrary. We could agree that the owners of German Shepherd dogs do not pay VAT on Thursdays if they have a green hat on. Royals and the like were convincing people for who knows how many millennia that their status and power is from god. In a way we have the same with current tax laws, we all think they come from "somewhere", whether it's a necessity or logic, experience or a textbook. The search space is much larger than what we make use of.
- maxxxxx 8y ago
  That's what I am telling people all the time. The "economy" is not a natural law but it's completely man made and can be adjusted to whatever goals a society wants to achieve. Obviously there are some constraints but there are a lot of parameters that can be tweaked. The owner class has convinced us that shareholders and property rights are the most important players but there is no reason why this can't be balanced with other things like workers rights, health care or retirement systems for all.
- Terr_ 8y ago
  Also, it's not just the "redistribution" of wealth that has some "clear former owner", but also how people divide "new" value that is created on-the-fly. Consider a company that mines for gold -- how much of that new value is split between the people who own the land, the people who dig the ore, the people who process the ore, the people who lent some money long ago, etc.
barrkel 8y ago
Inequality of outcomes is a requirement for incentives to improve. Correlated variance in income in return for variance in production is just. Generally, prices provide information about where more production is required, though at the cost of obscuring how that production was obtained. What we quibble about is (a) the distribution of the income function relative to the individual's production, and (b) how much income gets distributed on the basis of mere ownership, rather than production. The super-elite benefit much more from (b) than from (a). Mobility of capital means (b) is generally under-taxed.
- Karrot_Kream 8y ago
  Agreed that we need variance on the overall distribution of incomes to produce incentives to more efficiently produce goods, but not necessarily the bimodal distribution that's forming now. Not really disagreeing with you: I agree that we do not tax ownership-based income enough.
- windows_tips 8y ago
  >Inequality of outcomes is a requirement for incentives to improve. What proof do you use?
  - deleted 8y ago
    [deleted]
  - RhysU 8y ago
    I claim this is self-evident. What counterproof do you propose?
    - ajtulloch 8y ago
      Are you unironically claiming that having an inequality of economic outcomes is the only way to motivate/incentivise human behaviour?
      - RhysU 8y ago

To paraphrase Keyser Söze "The greatest trick the Super-Elite ever pulled was convincing the world that inequality is a desired outcome of a properly functioning economy".

nostrademons 8y ago

I would think that the more straightforward paraphrase is even better: "The greatest trick the Super-Elite ever pulled was convincing the world that they didn't exist." I doubt you'd find many people who actually agree that inequality is a desired outcome of a properly functioning economy (even if it's true). However, the Super-Elite have been remarkably successful at disappearing into the background and making the world forget about them. Look at the headlines today: they're about ICE & undocumented immigrants, or Nazis in Charlottesville, or Russian interference, or antifa protesters. You see very few news stories about private jet vacations or the real-estate holdings of the super-wealthy.

swframe2 8y ago
I agree. The super wealthy prefer seclusion but it is hard to hide a 10 bedroom mansion and a superyacht. It is better to provide a strong "foxnews education" so there is no need to hide. Honestly, I wonder if a symbolic model would work better for our society. Ask the rich to set aside 20% of their wealth to provide low interest rate (~1% to 2%) loans to the poor to be used specifically on self-improvement (housing, infrastructure, education, policing, healthcare, childcare, etc). The loans start small and increase with good payment history.
- prolikewh0a 8y ago
  >Ask the rich to set aside 20% of their wealth to provide low interest rate (~1% to 2%) loans to the poor to be used specifically on self-improvement (housing, infrastructure, education, policing, healthcare, childcare, etc). The loans start small and increase with good payment history. What you're suggesting would create more wealth for the elite. It's a loan, so they retain the same amount of money (since it's a loan, the assumption is that it's paid back), while gaining more money in interest. I am lower end of the spectrum when it comes to my wealth, and I probably can't even claim any sort of middle class "label" in the USA. I avoid debt (because I can't afford to pay it back) and wouldn't even consider something like this.
  - hakfoo 8y ago
    If the interest rate in the loan was pegged to track inflation, it should be roughly zero-practical-gain. But it's still clunky. There's no reason we can't say "people earning more than a few million dollars a year can afford to pay a 97% tax rate." We just need to have it wired together into a comprehensive plan. Hold passports if you have outstanding tax debt. Orchestrate "regime change" in Carribean tax shelters and Luxembourg instead of the Middle East for a change.
    - RhysU 8y ago
      > There's no reason we can't say "people earning more than a few million dollars a year can afford to pay a 97% tax rate." Sure there is. They won't bother creating any value if their marginal take is effectively zero. How hard would you work if someone said you couldn't take home more than $10K?
      - prolikewh0a 8y ago
        Ideally there would be tax brackets so people making $150,000/year aren't taking home poverty wages, but people making $1,000,000,000/year are taking home maybe a couple tens of millions, which is still perfectly comfortable to live on for an entire lifetime.
        darawk 8y ago
        I think you're missing his point. Say your hypothetical person is making $10,000,000/year already. He has the opportunity to work 40% harder to 10x his income up to $100M/year. However, at this point, his marginal tax rate under your scheme is already 97%, which means that on that extra $90M in theoretical income, he will only take home an extra $2.7M. Now, it's not worth it for him to make that extra effort, to only increase his realized income by 27%. The next question is: Why should you, someone presumably not making $10m/year, care? We care because when someone increases their earnings from $10M to $100M, in theory, they are doing so by creating value for society. In fact the people at the highest ends of the income distribution should be the ones creating the most value. So we really do want them to be incentivized to earn more. To ensure that they are, we need a top marginal rate that strikes a balance between unnecessary super wealth, and incentivizing the value creation that drives the tremendous prosperity of the modern economy. This is a delicate balancing act, to be sure. But it is extremely important to understand that it is a balancing act.
- xg15 8y ago
  > Ask the rich to set aside 20% of their wealth to provide low interest rate (~1% to 2%) loans... Instead of or in addition to taxes?
edanm 8y ago
> I doubt you'd find many people who actually agree that inequality is a desired outcome of a properly functioning economy (even if it's true). I don't agree (with your statement). I mean, I don't think most people actively begrudge people having a better situation than them - just like they don't sit around getting angry that Rachmaninoff is a better composer than them, or that Michael Jordan is a better basketball player. I think people do sometimes instinctively feel that one person having more wealth is somehow depriving them - but that's not universal, and only comes up in certain situations. > "The greatest trick the Super-Elite ever pulled was convincing the world that they didn't exist." > You see very few news stories about private jet vacations or the real-estate holdings of the super-wealthy. Like, I don't think you're actually claiming that there's any conspiracy here of the super-elite, despite the wording. But I don't get your point. You think it takes active work to make it so that there are no news stories about the super elite? I mean, I don't expect the newspapers in poorer countries to be filled with stories about how much better everyone in America has it. I don't think it's because Americans did anything special - it just doesn't really interest people. And again, I don't think everyone in Africa feels that the fact that most Americans are better off than them is necessarily so terrible. I think this sentiment tends to come up in certain situations (especially when explicitly talking about economic inequality), but not in general.

patkai 8y ago

Good one! Let me try another angle: the greatest trick is to cover up the simple fact that the redistribution of wealth is arbitrary. We could agree that the owners of German Shepherd dogs do not pay VAT on Thursdays if they have a green hat on. Royals and the like were convincing people for who knows how many millennia that their status and power is from god. In a way we have the same with current tax laws, we all think they come from "somewhere", whether it's a necessity or logic, experience or a textbook. The search space is much larger than what we make use of.

maxxxxx 8y ago
That's what I am telling people all the time. The "economy" is not a natural law but it's completely man made and can be adjusted to whatever goals a society wants to achieve. Obviously there are some constraints but there are a lot of parameters that can be tweaked. The owner class has convinced us that shareholders and property rights are the most important players but there is no reason why this can't be balanced with other things like workers rights, health care or retirement systems for all.
Terr_ 8y ago
Also, it's not just the "redistribution" of wealth that has some "clear former owner", but also how people divide "new" value that is created on-the-fly. Consider a company that mines for gold -- how much of that new value is split between the people who own the land, the people who dig the ore, the people who process the ore, the people who lent some money long ago, etc.

barrkel 8y ago

Inequality of outcomes is a requirement for incentives to improve. Correlated variance in income in return for variance in production is just. Generally, prices provide information about where more production is required, though at the cost of obscuring how that production was obtained. What we quibble about is (a) the distribution of the income function relative to the individual's production, and (b) how much income gets distributed on the basis of mere ownership, rather than production. The super-elite benefit much more from (b) than from (a). Mobility of capital means (b) is generally under-taxed.

Karrot_Kream 8y ago
Agreed that we need variance on the overall distribution of incomes to produce incentives to more efficiently produce goods, but not necessarily the bimodal distribution that's forming now. Not really disagreeing with you: I agree that we do not tax ownership-based income enough.
windows_tips 8y ago
>Inequality of outcomes is a requirement for incentives to improve. What proof do you use?
- deleted 8y ago
  [deleted]
- RhysU 8y ago
  I claim this is self-evident. What counterproof do you propose?
  - ajtulloch 8y ago
    Are you unironically claiming that having an inequality of economic outcomes is the only way to motivate/incentivise human behaviour?
    - RhysU 8y ago