11 ms·

The Pitchforks Are Coming For Us Plutocrats (2014)

108 points by yotamoron 6y ago

roenxi 6y ago
> But the problem isn’t that we have inequality. Some inequality is intrinsic to any high-functioning capitalist economy. The problem is that inequality is at historically high levels and getting worse every day. As long as people keep getting this so badly wrong the problem, whatever it is, is never going to be fixed. Really I just call on people to stop using the wrong language and try to articulate detectable problems. If you look out the window of your car (or house) and see homeless people (or mobs) - that isn't inequality. If all the homeless people had houses or all the mobers a comfortable life, the amount of inequality would be about the same as it is now. Inequality as measured is all but undetectable in the real world. I have no idea how unequal I am to the people who I see every day - and none of my readers on HN do either unless they've spent a few hours poring over some very dry statistical compendiums. The problem is much more likely that the link between productive work and reward has been completely severed for more than 40 years [0]. If being productive reliably led to being rewarded there would be many less problems. The people being rewarded aren't the people who are producing results. Go look at the late 60s and early 70s to figure out what changed. [0] https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/
- deleted 6y ago
  [deleted]
- tehjoker 6y ago
  Try hanging out in the non-rich areas of town and you will immediately understand how the wealthy have been attacking society.
- didibus 6y ago
  Effort to reward I think sometimes is measured as upward mobility. I agree that this is an important aspect, which needs to be measured. I think they call this equality of opportunity and education. So not everyone gets equal outcome, but all should have equal footing at making it up the ladder. That said, I think some of the issues are just that we're not even meeting the fundamental human rights. If you read over the UN declaration of human rights here: https://www.un.org/en/universal-declaration-human-rights/ https://www.un.org/en/universal-declaration-human-rights/ you can see we don't even meet them all.
- onion2k 6y ago
  I have no idea how unequal I am to the people who I see every day When someone drives past me in a car that I know costs the equivalent of 30 years of my salary I do have some idea of how unequal we are. It's a pretty big clue.
  - jtr1 6y ago
    Yes. I wish we would frame these conversations about value more in terms of time. It's even starker when you address it directly: >When someone drives past me in a car that I know costs the equivalent of 30 years of my life... Even as a comfortably paid software developer, someone with a billion dollars owns the equivalent of ten thousand years of my life.
  - roenxi 6y ago
    Fair enough. So what if I gave you the same car and he doubled his wealth. Now inequality has increased much more significantly. And you can't tell. You haven't found a measure of inequality, you have identified that you can't afford an expensive car. Insofar as they are problems, the solutions to inequality and material lack are different from each other. EDIT And furthermore, if inequality is the major problem, you're arguing you'd rather be in Scenario Now (no car) rather than Scenario Hypothetical (very expensive car). I don't like telling people their opinion, but I'd be shocked if inequality is going to be a factor in your decision making with that one.
    - bottled_poe 6y ago
      That’s not how markets work. If you gave everyone a Lamborghini, the value of a Lamborghini would plummet, so the wealth measure doesn’t move. Also, resources have to come from somewhere, and that has a cost. The theoretical you’ve proposed doesn’t hold up to much scrutiny and doesn’t seem like a useful model.
      - roenxi 6y ago
        > ... If you gave everyone a Lamborghini, the value of a Lamborghini would plummet ... If your argument is that the person with a Lamborghini isn't materially better off in a real sense and that wealth inequality is therefore a social construction then I am profoundly confused if you are also aligned with the article's thesis that pitchforks are going to be involved due to wealth inequality. The logical conclusion of that line of thought is to destroy the Lamborghini to promote wealth equality, which is stupid.
- waldfee 6y ago
  if you look at the graph, it all begins after 1971. that was the year the gold standard was finally abandoned for real. i am not an expert and don't know all the important puzzle pieces, or even understand them. but looking at our financial systems, i think a big part of the reasons for the problems of our current form of capitalism is the unlinking of fiat currency from any form of backing.
  - taneq 6y ago
    I'm just trying to get my head around this too. I think the basic mechanics of it are: 1) Abolish gold standard, enabling government to print money 2) Government prints money which is captured by large corporations 3) 90% of the population still owns the same amount of money but it's now worth far less because the rest of the pie is having cash pumped into it. We're seeing a current example of 2/3 with the Coronavirus government stimulus, which went directly into plutocrat pockets while the masses were handwaved away with a token gesture.
    - cryptica 6y ago
      >> We're seeing a current example of 2/3 with the Coronavirus government stimulus, which went directly into plutocrat pockets while the masses were handwaved away with a token gesture. This helps to maintain an illusion of scarcity. It keeps the productive working class desperate for fiat money. The realist is that there is no scarcity of fiat at the top echelons; this is made clear by the high valuation of cryptocurrency projects. The top 1% has so much free money coming in that they can toss it away some cryptocurrency projects with no effect at all on their lifestyles... And in doing so they also hedge their personal risk against the reality of an unsustainable fiat system of which they are currently beneficiaries.
    - Super_Jambo 6y ago
      This doesn't really stand up to the facts. Governments went off the gold standard far before 1971. By this logic the New Deal and WW2 government spending should've caused huge inequality through inflation. It seems far more about the success of neoliberal policy allowing economic & political power to concentrate. The various ways that concentrated power then kept capturing more and more of the pie can't be reduced to a single simple narrative. You have for example: * Tax cuts * Unregulated Monopolies * IP law * Owned Media * Unlimited Campaign donations And on and on.
- hackissimo123 6y ago
  > If you look out the window of your car (or house) and see homeless people (or mobs) - that isn't inequality. I don't understand your reasoning. If some people are homeless while others have houses, how is that not inequality? I've lived in São Paulo, where homeless people can be found on literally every street, while millionaires fly from skyscraper to skyscraper in their private helicopters to avoid the impassable traffic. No-one needs to pore over dry statistics to know that Brazil (to take just one example) has enormous levels of inequality.
  - goliatone 6y ago
    I had the impression that the main reason wealthier people in São Paulo use helicopters is to keep their ears in place[1], avoiding traffic jams sure might be a nice plus. [1] https://www.nytimes.com/2002/02/13/world/sao-paulo-becomes-the-kidnapping-capital-of-brazil.html https://www.nytimes.com/2002/02/13/world/sao-paulo-becomes-t...
    - hackissimo123 6y ago
      That too. And it illustrates another reason why extreme inequality is bad: even if you're a total psychopath with no concern for anyone except yourself, it's not in your interest to live in a society with extreme inequality - unless you like the idea of being surrounded by people who have so little compared to you that they're desperate for what you have, and are willing to use violence to get it.
  - roenxi 6y ago
    If you go out and measure 'inequality', it isn't a measure of homeless vs middle class, it is a measure of homeless vs mega-wealthy. That is a stupid comparison IMO - the gap between the poor and mega-wealthy doesn't matter as much as the actual conditions of the poor. The homeless vs middle class inequality could easily be much the same as it always has been. The middle class are getting increasingly tenuous in their wealth.
    - jessaustin 6y ago
- therealcamino 6y ago
  > The problem is much more likely that the link between productive work and reward has been completely severed for more than 40 years [0]. If being productive reliably led to being rewarded there would be many less problems. You spent paragraphs arguing against the existence of income inequality, then you finally get around to this statement, which is what people are actually talking about when they say "income inequality", and you agree with it. People are unequally rewarded for their productivity. The description of the first resource in your link even begins "Rising wage inequality..."
- cryptica 6y ago
  >> The problem is much more likely that the link between productive work and reward has been completely severed for more than 40 years [0]. If being productive reliably led to being rewarded there would be many less problems. The people being rewarded aren't the people who are producing results. Go look at the late 60s and early 70s to figure out what changed. I think this is a very good point. I always felt that this was the case when I compared my own generation with my parents' and grandparents' generations. That's not to say that things were always perfectly fair (especially during my grandparents' time). They never were completely fair, but at least the path to financial rewards was much more clear. The social contracts around wealth accumulation were always challenging to meet (especially for certain groups of people) but they were somewhat reliable in the sense that if you could meet certain skill requirements, or saved a certain portion of your income, your odds of being rewarded were high. Today, the social contracts which relate to skill and productivity are totally unclear - The only real social contract which is clear is that if you have capital then you can get more capital. Saving-up for something doesn't work anymore because of insanely inflationary monetary policy, you can't buy a house anymore (prices are also inflated) and the investment options which deliver returns tend to be both speculative and unethical (monopolistic). The number of intelligent, highly educated people who are poor and whose careers are uncertain today is unfathomable. The ratio of poor-productive people to rich-productive people is massive and growing. I don't think this was ever the case before. The number of rich-unproductive people is constantly growing because they are being selected based on attributes that are not related to their productive abilities. They are parasites on the system. They are enriching themselves by shrinking down the economy through increasing wealth concentration for themselves and their friends. They're earning money not by adding value, but by making it harder for productive people to earn money - This makes them more desperate for money, more vulnerable and more exploitable. The more rich-unproductive people there are, the less the social contracts make sense and the more people are going to want a reset. There is no limit to mediocrity. There is a point where people will accept an economic reset in whatever form is offered to them (dictatorship, communism, fascism...)
- base698 6y ago
  I live in LA in a house I rent. My morning walks take me by houses that cost up to $5 million, a short drive less than 5 miles I can see homes that are $20 million. In addition to the houses and the cars discussed--I'm a pilot. I see private airplanes routinely that are capable of taking their owners to Paris non-stop and cost $12 to $60 million. The trappings of wealth are merely a drop in the bucket.
pydry 6y ago
The ford story is a myth. A fairy tale told by investors to their children whom they want to grow up to become successful venture capitalists. He raised wages to: * Deal with worker turnover (Jeff Bezos did this too) * Gain more social control over his workers (he had a thing for good/clean/christian/nuclear family living and he wanted a remuneration policy that would let him enforce that). * To poke some of his shareholders in the eye (whom he'd had fallings out with). * Pour cold water over incipient unionization (Jeff Bezos also did this one recently). The oft repeated idea that our media likes to promulgate that it was a grand, magnanimous gesture done for selfless reasons (by a virulent antisemite no less) is not only untrue, it's the exact opposite of true - there had to be four really solid reasons to jack up wages before Henry Ford had his arm twisted into doing it.
- cpcallen 6y ago
  > Pour cold water over incipient unionization I'm generally pro-union, but I have absolutely no problem with an employer deterring its employees from unionising by paying them well and treating them right.
  - empath75 6y ago
    Wegmans also famously pays more than union grocery stores and treats their employees better.
  - tehjoker 6y ago
    If that's what they'll pay with no union, think about what they'd pay with one.
  - pydry 6y ago
    So... you don't disagree with the correction I made... but you'd just like to emphasize how much you agree with Henry Ford? Ok.
- throwawayffffas 6y ago
  The entire articles point is that raising wages is not a grand magnanimous gesture done for selfless reasons, but instead a very selfish act that leads to increased wealth and dramatically reduced chance of pitchfork related complications for the 0.01%.
jkingsbery 6y ago
This article is certainly an interesting read, but it seems like the only idea proposed is a higher minimum wage, the results of which seem to be mixed (https://grow.acorns.com/how-seattles-minimum-wage-has-changed-the-city/ https://grow.acorns.com/how-seattles-minimum-wage-has-change..., https://www.vox.com/the-highlight/2019/7/13/20690266/seattle-minimum-wage-15-dollars https://www.vox.com/the-highlight/2019/7/13/20690266/seattle..., https://publicpolicy.wharton.upenn.edu/live/news/2303-effects-of-the-15-minimum-wage-in-seattle https://publicpolicy.wharton.upenn.edu/live/news/2303-effect...). From what I've read, the academic study that paints the best possible picture says that for a 10% increase in the minimum wage, Seattle saw a 1% increase in wages (one would presumably expect a 10% increase in total wages, unless there was a decrease in total hours worked). There are partisan arguments for and against raising the minimum wage (which the author does a good job of summarizing), but from reading those studies it seems not obvious what raising the minimum wage will do at the macro level.
- vonmoltke 6y ago
  > Seattle saw a 1% increase in wages (one would presumably expect a 10% increase in total wages, unless there was a decrease in total hours worked). How's that? Why would a minimum wage increase raise the wages of everyone already making more than the new minimum wage by the same amount?
  - JohnClark1337 6y ago
    To be fair to those who worked their way out of minimum wage.
  - devonkim 6y ago
    The implication I’ve seen is that the bosses of minimum wage workers would need to see a pay increase if their pay is also only a little higher than minimum wage already. So pay would get crunched higher in those situations and mostly at the lower levels. The data for increasing minimum wage is curious. While job losses don’t occur for the most part when increased there does appear to be suppression of new jobs, some churn in rural areas, and for small businesses starting up. However, the stats I saw don’t really show anything about the wage distribution of new jobs but currently most new jobs are temp and gig workers that are usually higher than MW anyway. I’m generally in favor of market based approaches because they’re less susceptible to political issues but improving baseline wages at the bottom with a market would mean we need to drastically create more employers needing unskilled labor, remove a ton of unskilled labor from the pool, or increase unionization to increase bargaining. These are all a lot harder to accomplish and take a lot longer than just making MW higher by regulations but the political capital spent here to pass the increase in today’s America would be worse IMO than focusing more on affordable housing and healthcare that are easier with legislation and public funds.
baybal2 6y ago
503 anyone?
blickentwapft 6y ago
There’s no problem with capitalism. The problem is rich people aren’t willing to share the wealth with less fortunate. Socialism is a dirty word in the USA but it’s really just about taking care of everyone. Rich people - to generalize - aren’t ok with people getting free or minimal cost health care education housing and a financial safety net. But in general terms the rich fight against this. People get mad when you .... the rich... can have houses and cars and holidays and all the good things, but no one fights to ensure the less fortunate can own houses, that they aren’t bankrupted when they get sick, that they don’t have to work till they’re 78 even assuming they can get work. That’s why the pitchforks will one day come. Because the rich want all for us, none for you.
OctaviusCrassus 6y ago
Eliminate minimum wage like Sweden, Denmark, Switzerland, and Norway. Then you will see the roads paved in gold my friends.
OctaviusGaeus 6y ago
Eliminate minimum wage like Norway, Sweden, Denmark, and Switzerland. Then you will see the streets paved in gold my friends.
- akiselev 6y ago
  The lowest union participation rate out of those five countries is Norway with 51%. The other four have a union participation rate of over 2/3s of workers. Oh and they implement minimum wage at the provincial/city level. Strengthen unions (not the police union, ofcourse) and local governments. Then you will see the streets paved in gold my friend.
thanatos519 6y ago
When my dad read this, he bought a pitchfork and mounted it on the front of the house.
- deleted 6y ago
  [deleted]
notbezos 6y ago
from an AMZN early investor. the company that pays the lowest wages and creates the greatest wage disparities ever seen. great example of why the pitchforks are overdue. Even the rich who can see the writing on the wall are too greedy to do anything other than virtue signaling.
- fastball 6y ago
  Amazon certainly does not pay the lowest wages. And wage disparities are only bad where they don't make sense. But at AMZN, they do. AMZN has both some of the least skilled workers in the world, and also some of the most skilled workers in the world, which unsurprisingly demand vastly different rates. The requirements to be a warehouse worker at AMZN are basically: 1. Know how to read 2. Be physically fit. ...which is a pretty low bar. You don't even need to be clever with your hands or anything, so sweatshops in Bangladesh require more skill. Meanwhile, the people building infra at AMZN are some of the most intelligent, highest skilled people on earth. And I'm sorry, but until we live in a post-scarcity economy, the former group is always going to get paid very little, and the latter group is going to get paid a lot. Nothing else is tenable. You can ignore supply/demand with Communism, but Communism clearly doesn't work in practice as long as there is scarcity. Personally, I think UBI is a great solution to this problem. But the idea that AMZN is perpetrating an injustice by not paying unskilled, easily replaceable workers at anywhere close to the rate they pay highly-skilled, hard-to-replace workers is just silly.
  - jboog 6y ago
    The low skilled workers are going to get paid very little because we choose to pay them very little. We as a society have decided that rather than increase the wealth of the very poor at the bottom of society, instead we want to increase the wealth of the ultra wealthy. Why does a person need tens of billions of dollars? Because they worked very hard or had a great idea? Why isn't $500 million enough instead of $50 billion when we have kids in this country and around the world who don't know where their next meal is coming from? Much of Western Europe decided on a much different route than the US took and they have much more egalitarian societies. The problem is that in the US we decided that the ultra wealthy are our betters and deserve as much capital as they can accumulate and the parasites at the bottom are inferior and deserve to toil for Bezos' pocket lint.
mschuster91 6y ago
> One day, somebody sets himself on fire, then thousands of people are in the streets, and before you know it, the country is burning. Almost prophetic to today's events. It's gonna be a real rough ride once the masses that are currently focused on the murder of George Floyd and countless other PoC expand their view and take aim on the systemic issues that plague many Western societies. > These idiotic trickle-down policies are destroying my customer base. And yours too. Yup. I'm German, our car manufacturers have had the problem for years now that the only place they can grow and sell cars is China or some other export target. But well, that's the result of having: - about the biggest low-wage sector in whole Europe - 2/3rds of the population with either no meaningful savings at all or in debts (https://www.boeckler.de/de/boeckler-impuls-vermoegen-nur-jeder-dritte-hat-reserven-6400.htm https://www.boeckler.de/de/boeckler-impuls-vermoegen-nur-jed...) - and cars that cost tens of thousands of dollars in new How is the German economy supposed to "pull itself out of the recession on the bootstraps" when the majority of the population does not have bootstraps?
- noobermin 6y ago
  The analogy isn't quite correct. The current movement started with BLM and is turning into a referendum on policing, it isn't directly related to economic inequality (although under the hood, it's exactly that).
- jahaja 6y ago
  The usual stopgap is a vast expansion of consumer credit. But I guess that phase has already passed in Germany as well.
  - mschuster91 6y ago
    That doesn't work too much here for two reasons: 1. German consumers are notoriously averse to debt ("Schwäbische Hausfrau"). Most transactions pre-covid were in hard cash or using debit cards, credit cards are rare and American-style revolving credit cards even rarer (the debt incurred on a standard German CC will be fully deducted on the third workday of the month, no partial payments or payment targets). Consumer debt is mostly real estate, cars and financing for big-ticket purchases such as furniture or expensive computers). 1a. Additionally, German consumers and companies are even more averse to risk. Going bankrupt with a company (or personally) is seen as deeply shameful and something that is only reserved for the lower classes of society (which also explains, next to a lack of venture capital, the lack of successful global scale start-ups from Europe), and many shy away from stock markets and capital investment... it wasn't widespread even before the dot-com burst, but that essentially killed everything involving stocks as an investment methods to this day, so rather than to invest in ETFs people prefer to "safely lose money" in zero-interest "saving plans". And as 2/3rds of Germans don't have anything left over to save after making rent and food and Germany being a "renter market" instead of an "owner market" in real estate, they also cannot build up equity over the decades and generations. 2. Credit requirements: the European "Basel 2" requirements on credit are enormously restrictive. It's extremely hard to get approved for loans and to make it worse, it doesn't make any difference if you have done business with the bank as a known customer even for decades, the decision to grant a loan or not must be purely statistic/math based. This royally screwed e.g. farmers who suddenly had to put up their farm / equipment as collateral for loans for seeds, but also prevents lower classes from using (consumer) credit to invest in either outright consumption or into furthering their position in society (e.g. by starting their own company).
andrewl 6y ago
He and his team at Civic Ventures have a podcast called Pitchfork Economics which is worth listening to: https://pitchforkeconomics.com/episodes/ https://pitchforkeconomics.com/episodes/
Priem19 6y ago
It's too bad that articles as good as these don't say on the front page for more than a day.
GoodJokes 6y ago
This guy calls himself the father of the $15 minimum wage, which tells you all you need to know of what level of knowledge he is working with. There are much better sources for left wing economics than this rich band wagoner.

108 points by yotamoron 6y ago

> But the problem isn’t that we have inequality. Some inequality is intrinsic to any high-functioning capitalist economy. The problem is that inequality is at historically high levels and getting worse every day. As long as people keep getting this so badly wrong the problem, whatever it is, is never going to be fixed. Really I just call on people to stop using the wrong language and try to articulate detectable problems. If you look out the window of your car (or house) and see homeless people (or mobs) - that isn't inequality. If all the homeless people had houses or all the mobers a comfortable life, the amount of inequality would be about the same as it is now. Inequality as measured is all but undetectable in the real world. I have no idea how unequal I am to the people who I see every day - and none of my readers on HN do either unless they've spent a few hours poring over some very dry statistical compendiums. The problem is much more likely that the link between productive work and reward has been completely severed for more than 40 years [0]. If being productive reliably led to being rewarded there would be many less problems. The people being rewarded aren't the people who are producing results. Go look at the late 60s and early 70s to figure out what changed. [0] https://www.epi.org/productivity-pay-gap/ https://www.epi.org/productivity-pay-gap/

deleted 6y ago
[deleted]
tehjoker 6y ago
Try hanging out in the non-rich areas of town and you will immediately understand how the wealthy have been attacking society.
didibus 6y ago
Effort to reward I think sometimes is measured as upward mobility. I agree that this is an important aspect, which needs to be measured. I think they call this equality of opportunity and education. So not everyone gets equal outcome, but all should have equal footing at making it up the ladder. That said, I think some of the issues are just that we're not even meeting the fundamental human rights. If you read over the UN declaration of human rights here: https://www.un.org/en/universal-declaration-human-rights/ https://www.un.org/en/universal-declaration-human-rights/ you can see we don't even meet them all.
onion2k 6y ago
I have no idea how unequal I am to the people who I see every day When someone drives past me in a car that I know costs the equivalent of 30 years of my salary I do have some idea of how unequal we are. It's a pretty big clue.
- jtr1 6y ago
  Yes. I wish we would frame these conversations about value more in terms of time. It's even starker when you address it directly: >When someone drives past me in a car that I know costs the equivalent of 30 years of my life... Even as a comfortably paid software developer, someone with a billion dollars owns the equivalent of ten thousand years of my life.
- roenxi 6y ago
  Fair enough. So what if I gave you the same car and he doubled his wealth. Now inequality has increased much more significantly. And you can't tell. You haven't found a measure of inequality, you have identified that you can't afford an expensive car. Insofar as they are problems, the solutions to inequality and material lack are different from each other. EDIT And furthermore, if inequality is the major problem, you're arguing you'd rather be in Scenario Now (no car) rather than Scenario Hypothetical (very expensive car). I don't like telling people their opinion, but I'd be shocked if inequality is going to be a factor in your decision making with that one.
  - bottled_poe 6y ago
    That’s not how markets work. If you gave everyone a Lamborghini, the value of a Lamborghini would plummet, so the wealth measure doesn’t move. Also, resources have to come from somewhere, and that has a cost. The theoretical you’ve proposed doesn’t hold up to much scrutiny and doesn’t seem like a useful model.
    - roenxi 6y ago
      > ... If you gave everyone a Lamborghini, the value of a Lamborghini would plummet ... If your argument is that the person with a Lamborghini isn't materially better off in a real sense and that wealth inequality is therefore a social construction then I am profoundly confused if you are also aligned with the article's thesis that pitchforks are going to be involved due to wealth inequality. The logical conclusion of that line of thought is to destroy the Lamborghini to promote wealth equality, which is stupid.
waldfee 6y ago
if you look at the graph, it all begins after 1971. that was the year the gold standard was finally abandoned for real. i am not an expert and don't know all the important puzzle pieces, or even understand them. but looking at our financial systems, i think a big part of the reasons for the problems of our current form of capitalism is the unlinking of fiat currency from any form of backing.
- taneq 6y ago
  I'm just trying to get my head around this too. I think the basic mechanics of it are: 1) Abolish gold standard, enabling government to print money 2) Government prints money which is captured by large corporations 3) 90% of the population still owns the same amount of money but it's now worth far less because the rest of the pie is having cash pumped into it. We're seeing a current example of 2/3 with the Coronavirus government stimulus, which went directly into plutocrat pockets while the masses were handwaved away with a token gesture.
  - cryptica 6y ago
    >> We're seeing a current example of 2/3 with the Coronavirus government stimulus, which went directly into plutocrat pockets while the masses were handwaved away with a token gesture. This helps to maintain an illusion of scarcity. It keeps the productive working class desperate for fiat money. The realist is that there is no scarcity of fiat at the top echelons; this is made clear by the high valuation of cryptocurrency projects. The top 1% has so much free money coming in that they can toss it away some cryptocurrency projects with no effect at all on their lifestyles... And in doing so they also hedge their personal risk against the reality of an unsustainable fiat system of which they are currently beneficiaries.
  - Super_Jambo 6y ago
    This doesn't really stand up to the facts. Governments went off the gold standard far before 1971. By this logic the New Deal and WW2 government spending should've caused huge inequality through inflation. It seems far more about the success of neoliberal policy allowing economic & political power to concentrate. The various ways that concentrated power then kept capturing more and more of the pie can't be reduced to a single simple narrative. You have for example: * Tax cuts * Unregulated Monopolies * IP law * Owned Media * Unlimited Campaign donations And on and on.
hackissimo123 6y ago
> If you look out the window of your car (or house) and see homeless people (or mobs) - that isn't inequality. I don't understand your reasoning. If some people are homeless while others have houses, how is that not inequality? I've lived in São Paulo, where homeless people can be found on literally every street, while millionaires fly from skyscraper to skyscraper in their private helicopters to avoid the impassable traffic. No-one needs to pore over dry statistics to know that Brazil (to take just one example) has enormous levels of inequality.
- goliatone 6y ago
  I had the impression that the main reason wealthier people in São Paulo use helicopters is to keep their ears in place[1], avoiding traffic jams sure might be a nice plus. [1] https://www.nytimes.com/2002/02/13/world/sao-paulo-becomes-the-kidnapping-capital-of-brazil.html https://www.nytimes.com/2002/02/13/world/sao-paulo-becomes-t...
  - hackissimo123 6y ago
    That too. And it illustrates another reason why extreme inequality is bad: even if you're a total psychopath with no concern for anyone except yourself, it's not in your interest to live in a society with extreme inequality - unless you like the idea of being surrounded by people who have so little compared to you that they're desperate for what you have, and are willing to use violence to get it.
- roenxi 6y ago
  If you go out and measure 'inequality', it isn't a measure of homeless vs middle class, it is a measure of homeless vs mega-wealthy. That is a stupid comparison IMO - the gap between the poor and mega-wealthy doesn't matter as much as the actual conditions of the poor. The homeless vs middle class inequality could easily be much the same as it always has been. The middle class are getting increasingly tenuous in their wealth.
  - jessaustin 6y ago
therealcamino 6y ago
> The problem is much more likely that the link between productive work and reward has been completely severed for more than 40 years [0]. If being productive reliably led to being rewarded there would be many less problems. You spent paragraphs arguing against the existence of income inequality, then you finally get around to this statement, which is what people are actually talking about when they say "income inequality", and you agree with it. People are unequally rewarded for their productivity. The description of the first resource in your link even begins "Rising wage inequality..."
cryptica 6y ago
>> The problem is much more likely that the link between productive work and reward has been completely severed for more than 40 years [0]. If being productive reliably led to being rewarded there would be many less problems. The people being rewarded aren't the people who are producing results. Go look at the late 60s and early 70s to figure out what changed. I think this is a very good point. I always felt that this was the case when I compared my own generation with my parents' and grandparents' generations. That's not to say that things were always perfectly fair (especially during my grandparents' time). They never were completely fair, but at least the path to financial rewards was much more clear. The social contracts around wealth accumulation were always challenging to meet (especially for certain groups of people) but they were somewhat reliable in the sense that if you could meet certain skill requirements, or saved a certain portion of your income, your odds of being rewarded were high. Today, the social contracts which relate to skill and productivity are totally unclear - The only real social contract which is clear is that if you have capital then you can get more capital. Saving-up for something doesn't work anymore because of insanely inflationary monetary policy, you can't buy a house anymore (prices are also inflated) and the investment options which deliver returns tend to be both speculative and unethical (monopolistic). The number of intelligent, highly educated people who are poor and whose careers are uncertain today is unfathomable. The ratio of poor-productive people to rich-productive people is massive and growing. I don't think this was ever the case before. The number of rich-unproductive people is constantly growing because they are being selected based on attributes that are not related to their productive abilities. They are parasites on the system. They are enriching themselves by shrinking down the economy through increasing wealth concentration for themselves and their friends. They're earning money not by adding value, but by making it harder for productive people to earn money - This makes them more desperate for money, more vulnerable and more exploitable. The more rich-unproductive people there are, the less the social contracts make sense and the more people are going to want a reset. There is no limit to mediocrity. There is a point where people will accept an economic reset in whatever form is offered to them (dictatorship, communism, fascism...)
base698 6y ago
I live in LA in a house I rent. My morning walks take me by houses that cost up to $5 million, a short drive less than 5 miles I can see homes that are $20 million. In addition to the houses and the cars discussed--I'm a pilot. I see private airplanes routinely that are capable of taking their owners to Paris non-stop and cost $12 to $60 million. The trappings of wealth are merely a drop in the bucket.

pydry 6y ago

The ford story is a myth. A fairy tale told by investors to their children whom they want to grow up to become successful venture capitalists. He raised wages to: * Deal with worker turnover (Jeff Bezos did this too) * Gain more social control over his workers (he had a thing for good/clean/christian/nuclear family living and he wanted a remuneration policy that would let him enforce that). * To poke some of his shareholders in the eye (whom he'd had fallings out with). * Pour cold water over incipient unionization (Jeff Bezos also did this one recently). The oft repeated idea that our media likes to promulgate that it was a grand, magnanimous gesture done for selfless reasons (by a virulent antisemite no less) is not only untrue, it's the exact opposite of true - there had to be four really solid reasons to jack up wages before Henry Ford had his arm twisted into doing it.

cpcallen 6y ago
> Pour cold water over incipient unionization I'm generally pro-union, but I have absolutely no problem with an employer deterring its employees from unionising by paying them well and treating them right.
- empath75 6y ago
  Wegmans also famously pays more than union grocery stores and treats their employees better.
- tehjoker 6y ago
  If that's what they'll pay with no union, think about what they'd pay with one.
- pydry 6y ago
  So... you don't disagree with the correction I made... but you'd just like to emphasize how much you agree with Henry Ford? Ok.
throwawayffffas 6y ago
The entire articles point is that raising wages is not a grand magnanimous gesture done for selfless reasons, but instead a very selfish act that leads to increased wealth and dramatically reduced chance of pitchfork related complications for the 0.01%.

jkingsbery 6y ago

This article is certainly an interesting read, but it seems like the only idea proposed is a higher minimum wage, the results of which seem to be mixed (https://grow.acorns.com/how-seattles-minimum-wage-has-changed-the-city/ https://grow.acorns.com/how-seattles-minimum-wage-has-change..., https://www.vox.com/the-highlight/2019/7/13/20690266/seattle-minimum-wage-15-dollars https://www.vox.com/the-highlight/2019/7/13/20690266/seattle..., https://publicpolicy.wharton.upenn.edu/live/news/2303-effects-of-the-15-minimum-wage-in-seattle https://publicpolicy.wharton.upenn.edu/live/news/2303-effect...). From what I've read, the academic study that paints the best possible picture says that for a 10% increase in the minimum wage, Seattle saw a 1% increase in wages (one would presumably expect a 10% increase in total wages, unless there was a decrease in total hours worked). There are partisan arguments for and against raising the minimum wage (which the author does a good job of summarizing), but from reading those studies it seems not obvious what raising the minimum wage will do at the macro level.

vonmoltke 6y ago
> Seattle saw a 1% increase in wages (one would presumably expect a 10% increase in total wages, unless there was a decrease in total hours worked). How's that? Why would a minimum wage increase raise the wages of everyone already making more than the new minimum wage by the same amount?
- JohnClark1337 6y ago
  To be fair to those who worked their way out of minimum wage.
- devonkim 6y ago
  The implication I’ve seen is that the bosses of minimum wage workers would need to see a pay increase if their pay is also only a little higher than minimum wage already. So pay would get crunched higher in those situations and mostly at the lower levels. The data for increasing minimum wage is curious. While job losses don’t occur for the most part when increased there does appear to be suppression of new jobs, some churn in rural areas, and for small businesses starting up. However, the stats I saw don’t really show anything about the wage distribution of new jobs but currently most new jobs are temp and gig workers that are usually higher than MW anyway. I’m generally in favor of market based approaches because they’re less susceptible to political issues but improving baseline wages at the bottom with a market would mean we need to drastically create more employers needing unskilled labor, remove a ton of unskilled labor from the pool, or increase unionization to increase bargaining. These are all a lot harder to accomplish and take a lot longer than just making MW higher by regulations but the political capital spent here to pass the increase in today’s America would be worse IMO than focusing more on affordable housing and healthcare that are easier with legislation and public funds.

baybal2 6y ago

503 anyone?

blickentwapft 6y ago

There’s no problem with capitalism. The problem is rich people aren’t willing to share the wealth with less fortunate. Socialism is a dirty word in the USA but it’s really just about taking care of everyone. Rich people - to generalize - aren’t ok with people getting free or minimal cost health care education housing and a financial safety net. But in general terms the rich fight against this. People get mad when you .... the rich... can have houses and cars and holidays and all the good things, but no one fights to ensure the less fortunate can own houses, that they aren’t bankrupted when they get sick, that they don’t have to work till they’re 78 even assuming they can get work. That’s why the pitchforks will one day come. Because the rich want all for us, none for you.

OctaviusCrassus 6y ago

Eliminate minimum wage like Sweden, Denmark, Switzerland, and Norway. Then you will see the roads paved in gold my friends.

OctaviusGaeus 6y ago

Eliminate minimum wage like Norway, Sweden, Denmark, and Switzerland. Then you will see the streets paved in gold my friends.

akiselev 6y ago
The lowest union participation rate out of those five countries is Norway with 51%. The other four have a union participation rate of over 2/3s of workers. Oh and they implement minimum wage at the provincial/city level. Strengthen unions (not the police union, ofcourse) and local governments. Then you will see the streets paved in gold my friend.

thanatos519 6y ago

When my dad read this, he bought a pitchfork and mounted it on the front of the house.

deleted 6y ago
[deleted]

notbezos 6y ago

from an AMZN early investor. the company that pays the lowest wages and creates the greatest wage disparities ever seen. great example of why the pitchforks are overdue. Even the rich who can see the writing on the wall are too greedy to do anything other than virtue signaling.

fastball 6y ago
Amazon certainly does not pay the lowest wages. And wage disparities are only bad where they don't make sense. But at AMZN, they do. AMZN has both some of the least skilled workers in the world, and also some of the most skilled workers in the world, which unsurprisingly demand vastly different rates. The requirements to be a warehouse worker at AMZN are basically: 1. Know how to read 2. Be physically fit. ...which is a pretty low bar. You don't even need to be clever with your hands or anything, so sweatshops in Bangladesh require more skill. Meanwhile, the people building infra at AMZN are some of the most intelligent, highest skilled people on earth. And I'm sorry, but until we live in a post-scarcity economy, the former group is always going to get paid very little, and the latter group is going to get paid a lot. Nothing else is tenable. You can ignore supply/demand with Communism, but Communism clearly doesn't work in practice as long as there is scarcity. Personally, I think UBI is a great solution to this problem. But the idea that AMZN is perpetrating an injustice by not paying unskilled, easily replaceable workers at anywhere close to the rate they pay highly-skilled, hard-to-replace workers is just silly.
- jboog 6y ago
  The low skilled workers are going to get paid very little because we choose to pay them very little. We as a society have decided that rather than increase the wealth of the very poor at the bottom of society, instead we want to increase the wealth of the ultra wealthy. Why does a person need tens of billions of dollars? Because they worked very hard or had a great idea? Why isn't $500 million enough instead of $50 billion when we have kids in this country and around the world who don't know where their next meal is coming from? Much of Western Europe decided on a much different route than the US took and they have much more egalitarian societies. The problem is that in the US we decided that the ultra wealthy are our betters and deserve as much capital as they can accumulate and the parasites at the bottom are inferior and deserve to toil for Bezos' pocket lint.

mschuster91 6y ago

> One day, somebody sets himself on fire, then thousands of people are in the streets, and before you know it, the country is burning. Almost prophetic to today's events. It's gonna be a real rough ride once the masses that are currently focused on the murder of George Floyd and countless other PoC expand their view and take aim on the systemic issues that plague many Western societies. > These idiotic trickle-down policies are destroying my customer base. And yours too. Yup. I'm German, our car manufacturers have had the problem for years now that the only place they can grow and sell cars is China or some other export target. But well, that's the result of having: - about the biggest low-wage sector in whole Europe - 2/3rds of the population with either no meaningful savings at all or in debts (https://www.boeckler.de/de/boeckler-impuls-vermoegen-nur-jeder-dritte-hat-reserven-6400.htm https://www.boeckler.de/de/boeckler-impuls-vermoegen-nur-jed...) - and cars that cost tens of thousands of dollars in new How is the German economy supposed to "pull itself out of the recession on the bootstraps" when the majority of the population does not have bootstraps?

noobermin 6y ago
The analogy isn't quite correct. The current movement started with BLM and is turning into a referendum on policing, it isn't directly related to economic inequality (although under the hood, it's exactly that).
jahaja 6y ago
The usual stopgap is a vast expansion of consumer credit. But I guess that phase has already passed in Germany as well.
- mschuster91 6y ago
  That doesn't work too much here for two reasons: 1. German consumers are notoriously averse to debt ("Schwäbische Hausfrau"). Most transactions pre-covid were in hard cash or using debit cards, credit cards are rare and American-style revolving credit cards even rarer (the debt incurred on a standard German CC will be fully deducted on the third workday of the month, no partial payments or payment targets). Consumer debt is mostly real estate, cars and financing for big-ticket purchases such as furniture or expensive computers). 1a. Additionally, German consumers and companies are even more averse to risk. Going bankrupt with a company (or personally) is seen as deeply shameful and something that is only reserved for the lower classes of society (which also explains, next to a lack of venture capital, the lack of successful global scale start-ups from Europe), and many shy away from stock markets and capital investment... it wasn't widespread even before the dot-com burst, but that essentially killed everything involving stocks as an investment methods to this day, so rather than to invest in ETFs people prefer to "safely lose money" in zero-interest "saving plans". And as 2/3rds of Germans don't have anything left over to save after making rent and food and Germany being a "renter market" instead of an "owner market" in real estate, they also cannot build up equity over the decades and generations. 2. Credit requirements: the European "Basel 2" requirements on credit are enormously restrictive. It's extremely hard to get approved for loans and to make it worse, it doesn't make any difference if you have done business with the bank as a known customer even for decades, the decision to grant a loan or not must be purely statistic/math based. This royally screwed e.g. farmers who suddenly had to put up their farm / equipment as collateral for loans for seeds, but also prevents lower classes from using (consumer) credit to invest in either outright consumption or into furthering their position in society (e.g. by starting their own company).

andrewl 6y ago

He and his team at Civic Ventures have a podcast called Pitchfork Economics which is worth listening to: https://pitchforkeconomics.com/episodes/ https://pitchforkeconomics.com/episodes/

Priem19 6y ago

It's too bad that articles as good as these don't say on the front page for more than a day.

GoodJokes 6y ago

This guy calls himself the father of the $15 minimum wage, which tells you all you need to know of what level of knowledge he is working with. There are much better sources for left wing economics than this rich band wagoner.