6 ms·

I'm going to speak directly to your point, which is the claim that only absolute wealth matters, but relative wealth does not. Relative wealth buys you status,

I'm going to speak directly to your point, which is the claim that only absolute wealth matters, but relative wealth does not. Relative wealth buys you status, position, and power in society. That status protects you when things go wrong, when the system fails to measure or optimize for the things that you care about, or when the music suddenly stops and you find that you're the one left without a chair. People deeply care about not being on the bottom of the pecking order, because if you look at history, when anything goes wrong, it's always those at the bottom who get hit the hardest - whether it's famine, war, economic recession, or any of the myriad of instabilities and ills that visit our societies from time to time. Your contention that we should only care about minimum living standards requires a large amount of faith, not just in the system as it stands today, but that the system won't slowly erode those minimums over time because the poor lack the political and social power to keep their minimums. Without the power to protect your own interests, you're at the literal mercy of those who are better off than you to throw you a bone when you're most vulnerable. And the best guarantor of social and political power is to be necessary - to be a critical component of the means of production. Automation, outsourcing, and foreign competition have all been chipping away at the competitive position of the median American worker. A look at the path of inflation-adjusted minimum wage, the evisceration of unions, the opioid crisis, the recent Great Recession, the fact that standard housing, schooling, and medical care is becoming increasingly out of reach of the average wage-earners would suggest that in fact, life is not getting better for those at the bottom, despite the very large increase in absolute wealth since the 1970s.

roenxi 7y ago
> Your contention that we should only care about minimum living standards requires a large amount of faith, not just in the system as it stands today, but that the system won't slowly erode those minimums over time because the poor lack the political and social power to keep their minimums. Without the power to protect your own interests, you're at the literal mercy of those who are better off than you to throw you a bone when you're most vulnerable. Yeah, exactly. The focus should be on stuff like that rather than on wealth/income inequality; I can see we are on the same wavelength here. The natural solution to what you are talking about is to find ways to increase the standards of people who are not well off. The natural solution to inequality is to disenfranchise the wealthy, which doesn't put food on the table (literally, in the extreme China/Russia/Zimbabwe style cases). It works really badly & everyone important tries to migrate somewhere capitalist when it is tried, which is a contributing factor to why it generally isn't the done thing. If the focus is on inequality, then realising that a policy is not working will take a long time. If the focus is on living standards, feedback will be quick.
- deleted 7y ago
  [deleted]
- helen___keller 7y ago
  > The natural solution to inequality is to disenfranchise the wealthy, which doesn't put food on the table To use an example from the leftmost mainstream politicians in the United States, a current proposal is to enact a wealth tax on fortunes over $X million to fund a larger social safety net. You can argue that ideologically the focus should be on standards of living, not on inequality, but realistically a wealth tax fulfills both.
  - neilwilson 7y ago
    Why not simply accommodate the savings rather than constantly trying to confiscate them? A dynamic monetary system can do that. I don't understand this obsession on the left with behaving like Robin Hood. Wealth taxes will not alter the power position of the rich. All it does is get up the nose of the rich and require us to pay those people who want to play Robin Hood. QE labour hours however, and the power of the wealthy to deny others an income by not spending their haul is removed. They can count their coin and the poor still get to work and eat.
    - helen___keller 7y ago
      I'm not sure I understand what your proposal is but the answer to your question of "why wealth tax", the answer is pretty much because it's simple to convey and rally behind. Deficit spending (or straight up "money printing") could provide benefits to those who need it without taxation, but decades of political obsession over "how are we gonna pay for it" means that people feel better if a policy of "buy X" is followed by "while taking money from Y to pay for it" For Republicans, the Y is some nefarious unnamed government bloat or waste, but never military. Most recently it's food stamps, and as I understand it there's a lot of hungry gazes staring at social security and medicaid. For Democrats, the Y is some nefarious wealthy entity, either Big Corporations or The Rich. So, ambitious far left proposals involve taxing wealth, adding very high marginal tax rates at the top, and taxing corporations and investment vehicles. This is often silly for obvious reasons. For example, Bernie suggests taxing stock transactions, bond trades, and derivatives transactions, by a (low) percentage, which sounds insane personally. But that stocks and derivatives sounds like Evil Wall Street Bullshit to some voters so they eat it up.
iguy 7y ago
> Relative wealth buys you status, position > pecking order Some of this can't really be fixed: the top 10% of status only has room for 10% of the people, by definition. The pecking order, by definition, orders people. > and power in society. This seems like a better focus. How much extra power you gain by being on top varies a great deal between different societies (including earlier and later versions of any one country). This seems like the relevant variable. I'm not sure that this inequality of power is very well measured by monetary inequality. There is some correlation, because power can usually be turned into material comfort. But I'm not sure how much higher taxes or whatever remedy like that is proposed for moving money around, will move power around. > the best guarantor of social and political power is to be necessary I hear what you're saying, roughly about changes in the last 50 years in western countries. But it is also easy to think of large classes of absolutely necessary workers who had very little power, in many places and times. So I'm not sure that that's enough.
- ip26 7y ago
  As we've moved towards greater wealth inequality, it is also argued that we've moved towards wealth having greater access to power. (Citizens United, one dollar one vote, decline of unions, etc) You can go after wealth inequality, or you can go after the power-wealth connection. I'm not sure which is easier.
  - iguy 7y ago
    I'm not sure these connections are as clear as you seem to take them to be. I guess I should cite PG instead of re-typing... maybe we're still unwinding the world of WWII, which produces lots of correlated changes [1]. Maybe inequality is more about technology than tax laws [2]. [1] http://paulgraham.com/re.html http://paulgraham.com/re.html [2] http://paulgraham.com/ineq.html http://paulgraham.com/ineq.html
nugget 7y ago
As I watch pop culture media I can’t help but think that the desire for relative wealth/status is driven primarily by the desire to attract sexual and romantic partners. I don’t think people in their 20s and 30s are as worried about war and famine as they are about being undesirable, unpopular, rejected, and lonely. At least not in the US. I suppose sex tech and AR/VR tech could advance to the point where some of these fears are obliviated and humans begin to deprogram the desire for status within a social hierarchy. That would be quite a radical evolution.
- deleted 7y ago
  [deleted]
zozbot234 7y ago
> Relative wealth buys you status, position, and power in society. Social cohesion (including political involvement, etc.) buys these things far more effectively than money or any market mechanism. "Relative wealth" is a highly imperfect substitute for high social capital.

roenxi 7y ago

> Your contention that we should only care about minimum living standards requires a large amount of faith, not just in the system as it stands today, but that the system won't slowly erode those minimums over time because the poor lack the political and social power to keep their minimums. Without the power to protect your own interests, you're at the literal mercy of those who are better off than you to throw you a bone when you're most vulnerable. Yeah, exactly. The focus should be on stuff like that rather than on wealth/income inequality; I can see we are on the same wavelength here. The natural solution to what you are talking about is to find ways to increase the standards of people who are not well off. The natural solution to inequality is to disenfranchise the wealthy, which doesn't put food on the table (literally, in the extreme China/Russia/Zimbabwe style cases). It works really badly & everyone important tries to migrate somewhere capitalist when it is tried, which is a contributing factor to why it generally isn't the done thing. If the focus is on inequality, then realising that a policy is not working will take a long time. If the focus is on living standards, feedback will be quick.

deleted 7y ago
[deleted]
helen___keller 7y ago
> The natural solution to inequality is to disenfranchise the wealthy, which doesn't put food on the table To use an example from the leftmost mainstream politicians in the United States, a current proposal is to enact a wealth tax on fortunes over $X million to fund a larger social safety net. You can argue that ideologically the focus should be on standards of living, not on inequality, but realistically a wealth tax fulfills both.
- neilwilson 7y ago
  Why not simply accommodate the savings rather than constantly trying to confiscate them? A dynamic monetary system can do that. I don't understand this obsession on the left with behaving like Robin Hood. Wealth taxes will not alter the power position of the rich. All it does is get up the nose of the rich and require us to pay those people who want to play Robin Hood. QE labour hours however, and the power of the wealthy to deny others an income by not spending their haul is removed. They can count their coin and the poor still get to work and eat.
  - helen___keller 7y ago
    I'm not sure I understand what your proposal is but the answer to your question of "why wealth tax", the answer is pretty much because it's simple to convey and rally behind. Deficit spending (or straight up "money printing") could provide benefits to those who need it without taxation, but decades of political obsession over "how are we gonna pay for it" means that people feel better if a policy of "buy X" is followed by "while taking money from Y to pay for it" For Republicans, the Y is some nefarious unnamed government bloat or waste, but never military. Most recently it's food stamps, and as I understand it there's a lot of hungry gazes staring at social security and medicaid. For Democrats, the Y is some nefarious wealthy entity, either Big Corporations or The Rich. So, ambitious far left proposals involve taxing wealth, adding very high marginal tax rates at the top, and taxing corporations and investment vehicles. This is often silly for obvious reasons. For example, Bernie suggests taxing stock transactions, bond trades, and derivatives transactions, by a (low) percentage, which sounds insane personally. But that stocks and derivatives sounds like Evil Wall Street Bullshit to some voters so they eat it up.

iguy 7y ago

> Relative wealth buys you status, position > pecking order Some of this can't really be fixed: the top 10% of status only has room for 10% of the people, by definition. The pecking order, by definition, orders people. > and power in society. This seems like a better focus. How much extra power you gain by being on top varies a great deal between different societies (including earlier and later versions of any one country). This seems like the relevant variable. I'm not sure that this inequality of power is very well measured by monetary inequality. There is some correlation, because power can usually be turned into material comfort. But I'm not sure how much higher taxes or whatever remedy like that is proposed for moving money around, will move power around. > the best guarantor of social and political power is to be necessary I hear what you're saying, roughly about changes in the last 50 years in western countries. But it is also easy to think of large classes of absolutely necessary workers who had very little power, in many places and times. So I'm not sure that that's enough.

ip26 7y ago
As we've moved towards greater wealth inequality, it is also argued that we've moved towards wealth having greater access to power. (Citizens United, one dollar one vote, decline of unions, etc) You can go after wealth inequality, or you can go after the power-wealth connection. I'm not sure which is easier.
- iguy 7y ago
  I'm not sure these connections are as clear as you seem to take them to be. I guess I should cite PG instead of re-typing... maybe we're still unwinding the world of WWII, which produces lots of correlated changes [1]. Maybe inequality is more about technology than tax laws [2]. [1] http://paulgraham.com/re.html http://paulgraham.com/re.html [2] http://paulgraham.com/ineq.html http://paulgraham.com/ineq.html

nugget 7y ago

As I watch pop culture media I can’t help but think that the desire for relative wealth/status is driven primarily by the desire to attract sexual and romantic partners. I don’t think people in their 20s and 30s are as worried about war and famine as they are about being undesirable, unpopular, rejected, and lonely. At least not in the US. I suppose sex tech and AR/VR tech could advance to the point where some of these fears are obliviated and humans begin to deprogram the desire for status within a social hierarchy. That would be quite a radical evolution.

deleted 7y ago
[deleted]

zozbot234 7y ago

> Relative wealth buys you status, position, and power in society. Social cohesion (including political involvement, etc.) buys these things far more effectively than money or any market mechanism. "Relative wealth" is a highly imperfect substitute for high social capital.