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This ignores the fundamental insight of economics that people can cooperate motivated entirely by self interest. Poor person needs food and housing to survive,

This ignores the fundamental insight of economics that people can cooperate motivated entirely by self interest. Poor person needs food and housing to survive, so they cooperate by working for someone. Rich person needs people to work their factories, so they cooperate by hiring poor people. From this traditional perspective the "common good" is a result of insufficient property rights: if everything is owned by something, then by everyone looking after their private good, everything will be looked after (because all "common good" is somebody's "private good"). It also ignores that redistribution results in less "private good" (GDP) for everyone, because by definition it's taking wealth from people who on average have demonstrated more ability to grow wealth and giving it to people who have demonstrated less ability to grow wealth. Imagine two otherwise identical people, one who's capable of generating 5% returns on his wealth and the other who's capable of generating 2% returns. If they both start with the same endowment, after 100 years the total amount of wealth they've generated will be much greater if they're allowed to keep their own wealth than if the 5% guy's is continuously redistributed to the 2% guy (because every dollar redistributed will earn only 2% return instead of 5%, meaning it's been used to produce less value for society). More practical example: imagine if after Paypal, Elon Musk's entire wealth had been redistributed to all Americans. Assume generously he had 50 billion (pretty sure he had less than that). 50 billion / 300 million is around $166 per person. So now every person in America is $166 richer, and the world has no Tesla or SpaceX.

Neeek 7y ago
That is assuming that the person that owns the wealth is the sole driver for growth of that wealth. Can we stop pretending that being wealthy is empirical evidence that you know how to grow an investment?
- logicchains 7y ago
  It doesn't matter what the driver is, if A over time has continuously demonstrated the ability to achieve higher returns on their wealth than B has, absent other evidence (ceteris parabis) it's reasonable to assume this trend will continue in future. Yes there are some people who got wealthy only through inheritance, but the money they inherited still had to be originally created by someone capable of generating wealth.
  - Neeek 7y ago
    This completely ignores the fact that below a certain line, B no longer gets to participate as freely as A in the space. A gets to demonstrate higher returns as well as higher losses and still be considered a better option even though in absolute terms they have contributed greater losses than B. "Reasonable to assume, follow the trend" is just so braindead, and basically no better than flipping a coin; if you're are absent of any other evidence, then maybe you shouldn't be using that to segregate the population in to the poors and those-who-know-better.
  - raducu 7y ago
    "it's reasonable to assume this trend will continue in future." -- except its not, that's why we had the 2008 crisis -- I can generate 20% returns 9/10 years, but on the 10th year I tank the whole world economy with my risky subprime bets.
elfexec 7y ago
> This ignores the fundamental insight of economics that people can cooperate motivated entirely by self interest. How is that a fundamental insight of economics. It's the insight of the smallest group all the way to cities and civilization. Self interest, by definition, motivates cooperation. > From this traditional perspective the "common good" is a result of insufficient property rights: if everything is owned by something, then by everyone looking after their private good, everything will be looked after (because all "common good" is somebody's "private good"). What you are describing isn't "insufficient property rights", you are describing "insufficient property". > It also ignores that redistribution results in less "private good" (GDP) for everyone, because by definition it's taking wealth from people who on average have demonstrated more ability to grow wealth and giving it to people who have demonstrated less ability to grow wealth. Wealth is always "stolen". Behind every great wealth is a great crime. Wealth is generate by theft of assets ( land, oil, resources ) or theft of labor. Bill Gates didn't generate his wealth. His workers generated the wealth, he and the shareholders just siphoned the largest part of it. Look at the fundamental wealth of the US - the land and resources that provides unimaginable amount of wealth. All stolen from the natives. Wealth = clever robbing the less clever with the protection of the law which they created. And it isn't necessarily a bad thing. > If they both start with the same endowment What an ideal world you must live in. > More practical example: imagine if after Paypal, Elon Musk's entire wealth had been redistributed to all Americans. Who is even advocating for taking all of anyone's wealth? > and the world has no Tesla or SpaceX. Why not? Using your argument, PayPal couldn't exist since Musk didn't have that PayPal money to fund his business. You have an agenda and you are using obvious extremes and lies to push your agenda. The other side does the same. Instead of being driven by agenda, try to think objectively. Look at the problem from afar. Extremes in either direction is bad for the individual and society.
- logicchains 7y ago
  >Wealth is always "stolen". Behind every great wealth is a great crime. Wealth is generate by theft of assets ( land, oil, resources ) or theft of labor. You're making misleading use of language so it's hard to believe you're arguing sincerely. Offering someone compensation for doing something for you is not what most people would consider "theft". You can't just take a word meaning one thing, change its meaning, then assume all the judgements about the old meaning also apply to the new meaning.

Neeek 7y ago

That is assuming that the person that owns the wealth is the sole driver for growth of that wealth. Can we stop pretending that being wealthy is empirical evidence that you know how to grow an investment?

logicchains 7y ago
It doesn't matter what the driver is, if A over time has continuously demonstrated the ability to achieve higher returns on their wealth than B has, absent other evidence (ceteris parabis) it's reasonable to assume this trend will continue in future. Yes there are some people who got wealthy only through inheritance, but the money they inherited still had to be originally created by someone capable of generating wealth.
- Neeek 7y ago
  This completely ignores the fact that below a certain line, B no longer gets to participate as freely as A in the space. A gets to demonstrate higher returns as well as higher losses and still be considered a better option even though in absolute terms they have contributed greater losses than B. "Reasonable to assume, follow the trend" is just so braindead, and basically no better than flipping a coin; if you're are absent of any other evidence, then maybe you shouldn't be using that to segregate the population in to the poors and those-who-know-better.
- raducu 7y ago
  "it's reasonable to assume this trend will continue in future." -- except its not, that's why we had the 2008 crisis -- I can generate 20% returns 9/10 years, but on the 10th year I tank the whole world economy with my risky subprime bets.

elfexec 7y ago

> This ignores the fundamental insight of economics that people can cooperate motivated entirely by self interest. How is that a fundamental insight of economics. It's the insight of the smallest group all the way to cities and civilization. Self interest, by definition, motivates cooperation. > From this traditional perspective the "common good" is a result of insufficient property rights: if everything is owned by something, then by everyone looking after their private good, everything will be looked after (because all "common good" is somebody's "private good"). What you are describing isn't "insufficient property rights", you are describing "insufficient property". > It also ignores that redistribution results in less "private good" (GDP) for everyone, because by definition it's taking wealth from people who on average have demonstrated more ability to grow wealth and giving it to people who have demonstrated less ability to grow wealth. Wealth is always "stolen". Behind every great wealth is a great crime. Wealth is generate by theft of assets ( land, oil, resources ) or theft of labor. Bill Gates didn't generate his wealth. His workers generated the wealth, he and the shareholders just siphoned the largest part of it. Look at the fundamental wealth of the US - the land and resources that provides unimaginable amount of wealth. All stolen from the natives. Wealth = clever robbing the less clever with the protection of the law which they created. And it isn't necessarily a bad thing. > If they both start with the same endowment What an ideal world you must live in. > More practical example: imagine if after Paypal, Elon Musk's entire wealth had been redistributed to all Americans. Who is even advocating for taking all of anyone's wealth? > and the world has no Tesla or SpaceX. Why not? Using your argument, PayPal couldn't exist since Musk didn't have that PayPal money to fund his business. You have an agenda and you are using obvious extremes and lies to push your agenda. The other side does the same. Instead of being driven by agenda, try to think objectively. Look at the problem from afar. Extremes in either direction is bad for the individual and society.

logicchains 7y ago
>Wealth is always "stolen". Behind every great wealth is a great crime. Wealth is generate by theft of assets ( land, oil, resources ) or theft of labor. You're making misleading use of language so it's hard to believe you're arguing sincerely. Offering someone compensation for doing something for you is not what most people would consider "theft". You can't just take a word meaning one thing, change its meaning, then assume all the judgements about the old meaning also apply to the new meaning.