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Imagine being Jerome Powell and saying with a straight face to the cameras that the Fed monetary policy has absolutely nothing to do with inequality. Pitchforks

Imagine being Jerome Powell and saying with a straight face to the cameras that the Fed monetary policy has absolutely nothing to do with inequality. Pitchforks get ever closer. Robin Williams on the topic: https://www.youtube.com/watch?v=etQeFJ2lbbo https://www.youtube.com/watch?v=etQeFJ2lbbo

chii 6y ago
The Feds have picked the lesser of two evils. QE and various monetary policy does increase inequality (of opportunity), but it also propped up some businesses which are employers and prevent an even larger economic collapse.
hn_throwaway_99 6y ago
Agreed, I think people are underestimating the potential for societal breakdown in the US. The common refrain is that inequality is necessary but not sufficient for a revolution, but that it's also the case that the absolute level of the masses needs to be bad enough that the feeling of "I've got nothing left to lose" sets in. I think the post-covid housing crisis could be a potential trigger for that. There are going to be a flood of evictions once the moratoriums are lifted. There is already a growing belief that property ownership in the US is "rigged", and once a society has widespread disillusionment with property rights, it's usually downhill from there.
- psychometry 6y ago
  A large proportion of those masses (Republican voters) fervently support the very policies that have been driving inequality for decades. They don't really understand that, of course, but the worse things get, the more they flock to right-wing populist nonsense, accelerating their own financial ruin. I'm not sure how to fix it. It's clearly too late to educate them properly about how economies function.
  - WealthVsSurvive 6y ago
    Loss aversion among the oligarch & owner classes will always result in fascism eventually, as enemies are created within or without to satisfy the will to power, which is itself the will to live: I am that I am. All of this has happened before, and unless we end it, all of this will happen again, assuming we have the opportunity to even try again. The violence of this loss aversion turned inwards is what destroys societies and makes them vulnerable to foreign invasion through more concrete material means of productions. In short: wealth inequality is fundamentally destructive to civilizations.
  - rayiner 6y ago
    I used to believe this, but then I realized why ordinary Republicans for the most part don’t care so much about rising inequality: they don’t live in places where it’s that noticeable. In DC or New York or San Francisco inequality is always in your face. Public housing down the block from co-ops that even Facebook engineers can’t afford. But for the most part, republicans don’t live there. My Maryland county is pretty red—Clinton was the first Democrat to win it (barely) since JFK. There are some very rich people here, but you can really only tell by their boats. The waterfront houses are mostly owned by retired middle class people. (We bought ours from a young couple: a disabled vet and a nurse.) The nicer waterfront houses are as likely to be owned by a guy with a successful contracting business as a business executive. The public schools are excellent and you can buy a 3BR house zoned for the best high school in the area for 3-4 times the median income. You could make $1 million/year (and some people do) but other than on a boat there is nowhere extravagant to spend that money. There’s no restaurant in the entire county that the vast majority of people couldn’t afford to go to for at least a special occasion. And like I said, we do have some old money yacht racing types. Go a bit further out where the rich people are farmers with their wealth tied up in land, and the society is even flatter. The vast majority of Republican America is like that.
    - hn_throwaway_99 6y ago
      > The vast majority of Republican America is like that. I don't think that's really true. If you take suburbs/exurbs out of the equation (which polling shows turning quickly away from Republicans due to Trump revulsion, though not necessarily into the arms of the Democrats), many Republican strongholds are (a) places where voting patterns fall nearly entirely along racial lines (i.e. the Deep South), and (b) places that have seen a demise in opportunity, like the Rust Belt, where pretty much any young person with talent and ambition gets out as soon as they are able. You may not see a ton of inequality in some of these "hollowed out" areas, but people certainly know it exists.
    - tptacek 6y ago
      This probably doesn't describe Ohio well.
- SpicyLemonZest 6y ago
  I'm not saying it can't happen, but every urban society in history has had rich landlords and frustrated renters. It'll become a more critical problem if people start getting booted out onto the street en masse, but I think there's reason to be optimistic that can be avoided, since politicians on all sides have made it clear they don't plan to let it happen.
  - hn_throwaway_99 6y ago
    > since politicians on all sides have made it clear they don't plan to let it happen. Really?? The only "plan" I've seen is continued moratorium on evictions, which at some point just becomes stealing from landlords to give to renters (as many have pointed out, there hasn't been a corresponding moratorium on mortgage or property tax payments), which at some point guarantees there will be less people willing to rent housing. I haven't seen any widespread plan that actually addresses the problem at a broader level.
    - SpicyLemonZest 6y ago
      I think that's the appropriate action for an economy in emergency mode. When you see a bad thing coming, you simply say "the bad thing is banned", and deal with secondary problems as they arise. The problem at a broader level is the virus, which economic policy can't directly address, and the health crisis is expected to end soon enough that our policies don't need to be sustainable indefinitely.
      - hn_throwaway_99 6y ago
        But that's the whole point. In Texas there are many (most?) areas that have eviction moratoriums until Sept 30 (already extended twice, not surprised if they are extended again). Many landlords have received no rent payments for months. IMO that makes sense, but when they do eventually lift the moratoriums, very few of these people will be able to pay their back rent. When you haven't paid rent for 6 (or 9 or 12 or whatever) months, the normal policy is to get evicted. This flood is inevitable and all I've heard from politicians are kick the can down the road type solutions.
WealthVsSurvive 6y ago
Look at what happened to the large majority of bank-owned homes from the previous crash (~17 million of them): they let them rot. Rather than affect the price of real estate, they let these homes rot, so the trade unions of finance and insurance can charge more for mortgages and fees. Now there are about to be ~10-30 million displaced peoples. This is not an ethical society and it deserves and should expect revolt, and it should be no surprise whatsoever when people begin committing property crimes. You were warned. You just didn't listen.
deleted 6y ago
[deleted]
rayiner 6y ago
I’m not sure billionaires are the problem with respect to income/wealth inequality. We’ve always had mega-rich families, but what’s driving the anger against wealth inequality now? The new phenomenon we’re seeing now is the pulling away of the upper middle class from everyone else. I think that’s the real source of anger against inequality. I don’t think most people really care that there is some billionaire out there. All billionaires combined earn just 1% of all income, so it’s not like they’re sucking up a huge part of all income. People get mad when they feel like they’re competing for real world resources, and there just aren’t enough billionaires to do that. But the Facebook engineer making $500,000/year? They’re the ones buying up the houses and driving middle class people out of neighborhoods. I’ve been listening to the new New York Times podcast “Nice White Parents”: https://www.nytimes.com/2020/07/30/podcasts/nice-white-parents-serial.html https://www.nytimes.com/2020/07/30/podcasts/nice-white-paren.... The first couple of episodes talks about the conflict between lower income Black and Hispanic parents and high income white parents in a Brooklyn neighborhood school. I think when people get mad about income inequality, for the most part they’re reacting to that sort competition for limited resources in American neighborhoods. And the “rich people” that are competing for those resources aren’t billionaires, but the upper middle class.
- flashgordon 6y ago
  """ But the Facebook engineer making $500,000/year? They’re the ones buying up the houses and driving middle class people out of neighborhoods. """ Wait this sounds like demonizing the FB engineer for making the 500k even though he would now have to pay millions for a medium size/class/type home that was previously owned by (and sold for) a crazy amount by said "middle class". I get very worried when I see this sentiment where somehow the employees of these companies are responsible for killing the previous fabric but what is driving them to these decisions is somehow sacred?
  - bhupy 6y ago
    I wouldn’t call it “demonizing”, per se, but it’s a real phenomenon. I live in Brooklyn where rent isn’t the cheapest. The rents aren’t driven up because I’m in a bidding war with Jeff Bezos; they’re driven up because I’m in a bidding war with other high earning millennial yuppies. The blue collar “middle class” worker doesn’t stand a chance in our neighborhood. In contrast, my folks live in Wisconsin, where the same blue collar “middle class” worker probably doesn’t care about rent bidding wars because they just put a down payment on a nice starter home.
a2h 6y ago
I think that was the point at which I stopped watching as it was utterly shocking how much of a disconnect there is there. Thank you for sharing the Robin Williams clip, I had not seen that before and found it hilarious and perfectly fitting.

chii 6y ago

The Feds have picked the lesser of two evils. QE and various monetary policy does increase inequality (of opportunity), but it also propped up some businesses which are employers and prevent an even larger economic collapse.

hn_throwaway_99 6y ago

Agreed, I think people are underestimating the potential for societal breakdown in the US. The common refrain is that inequality is necessary but not sufficient for a revolution, but that it's also the case that the absolute level of the masses needs to be bad enough that the feeling of "I've got nothing left to lose" sets in. I think the post-covid housing crisis could be a potential trigger for that. There are going to be a flood of evictions once the moratoriums are lifted. There is already a growing belief that property ownership in the US is "rigged", and once a society has widespread disillusionment with property rights, it's usually downhill from there.

psychometry 6y ago
A large proportion of those masses (Republican voters) fervently support the very policies that have been driving inequality for decades. They don't really understand that, of course, but the worse things get, the more they flock to right-wing populist nonsense, accelerating their own financial ruin. I'm not sure how to fix it. It's clearly too late to educate them properly about how economies function.
- WealthVsSurvive 6y ago
  Loss aversion among the oligarch & owner classes will always result in fascism eventually, as enemies are created within or without to satisfy the will to power, which is itself the will to live: I am that I am. All of this has happened before, and unless we end it, all of this will happen again, assuming we have the opportunity to even try again. The violence of this loss aversion turned inwards is what destroys societies and makes them vulnerable to foreign invasion through more concrete material means of productions. In short: wealth inequality is fundamentally destructive to civilizations.
- rayiner 6y ago
  I used to believe this, but then I realized why ordinary Republicans for the most part don’t care so much about rising inequality: they don’t live in places where it’s that noticeable. In DC or New York or San Francisco inequality is always in your face. Public housing down the block from co-ops that even Facebook engineers can’t afford. But for the most part, republicans don’t live there. My Maryland county is pretty red—Clinton was the first Democrat to win it (barely) since JFK. There are some very rich people here, but you can really only tell by their boats. The waterfront houses are mostly owned by retired middle class people. (We bought ours from a young couple: a disabled vet and a nurse.) The nicer waterfront houses are as likely to be owned by a guy with a successful contracting business as a business executive. The public schools are excellent and you can buy a 3BR house zoned for the best high school in the area for 3-4 times the median income. You could make $1 million/year (and some people do) but other than on a boat there is nowhere extravagant to spend that money. There’s no restaurant in the entire county that the vast majority of people couldn’t afford to go to for at least a special occasion. And like I said, we do have some old money yacht racing types. Go a bit further out where the rich people are farmers with their wealth tied up in land, and the society is even flatter. The vast majority of Republican America is like that.
  - hn_throwaway_99 6y ago
    > The vast majority of Republican America is like that. I don't think that's really true. If you take suburbs/exurbs out of the equation (which polling shows turning quickly away from Republicans due to Trump revulsion, though not necessarily into the arms of the Democrats), many Republican strongholds are (a) places where voting patterns fall nearly entirely along racial lines (i.e. the Deep South), and (b) places that have seen a demise in opportunity, like the Rust Belt, where pretty much any young person with talent and ambition gets out as soon as they are able. You may not see a ton of inequality in some of these "hollowed out" areas, but people certainly know it exists.
  - tptacek 6y ago
    This probably doesn't describe Ohio well.
SpicyLemonZest 6y ago
I'm not saying it can't happen, but every urban society in history has had rich landlords and frustrated renters. It'll become a more critical problem if people start getting booted out onto the street en masse, but I think there's reason to be optimistic that can be avoided, since politicians on all sides have made it clear they don't plan to let it happen.
- hn_throwaway_99 6y ago
  > since politicians on all sides have made it clear they don't plan to let it happen. Really?? The only "plan" I've seen is continued moratorium on evictions, which at some point just becomes stealing from landlords to give to renters (as many have pointed out, there hasn't been a corresponding moratorium on mortgage or property tax payments), which at some point guarantees there will be less people willing to rent housing. I haven't seen any widespread plan that actually addresses the problem at a broader level.
  - SpicyLemonZest 6y ago
    I think that's the appropriate action for an economy in emergency mode. When you see a bad thing coming, you simply say "the bad thing is banned", and deal with secondary problems as they arise. The problem at a broader level is the virus, which economic policy can't directly address, and the health crisis is expected to end soon enough that our policies don't need to be sustainable indefinitely.
    - hn_throwaway_99 6y ago
      But that's the whole point. In Texas there are many (most?) areas that have eviction moratoriums until Sept 30 (already extended twice, not surprised if they are extended again). Many landlords have received no rent payments for months. IMO that makes sense, but when they do eventually lift the moratoriums, very few of these people will be able to pay their back rent. When you haven't paid rent for 6 (or 9 or 12 or whatever) months, the normal policy is to get evicted. This flood is inevitable and all I've heard from politicians are kick the can down the road type solutions.

WealthVsSurvive 6y ago

Look at what happened to the large majority of bank-owned homes from the previous crash (~17 million of them): they let them rot. Rather than affect the price of real estate, they let these homes rot, so the trade unions of finance and insurance can charge more for mortgages and fees. Now there are about to be ~10-30 million displaced peoples. This is not an ethical society and it deserves and should expect revolt, and it should be no surprise whatsoever when people begin committing property crimes. You were warned. You just didn't listen.

deleted 6y ago

[deleted]

rayiner 6y ago

I’m not sure billionaires are the problem with respect to income/wealth inequality. We’ve always had mega-rich families, but what’s driving the anger against wealth inequality now? The new phenomenon we’re seeing now is the pulling away of the upper middle class from everyone else. I think that’s the real source of anger against inequality. I don’t think most people really care that there is some billionaire out there. All billionaires combined earn just 1% of all income, so it’s not like they’re sucking up a huge part of all income. People get mad when they feel like they’re competing for real world resources, and there just aren’t enough billionaires to do that. But the Facebook engineer making $500,000/year? They’re the ones buying up the houses and driving middle class people out of neighborhoods. I’ve been listening to the new New York Times podcast “Nice White Parents”: https://www.nytimes.com/2020/07/30/podcasts/nice-white-parents-serial.html https://www.nytimes.com/2020/07/30/podcasts/nice-white-paren.... The first couple of episodes talks about the conflict between lower income Black and Hispanic parents and high income white parents in a Brooklyn neighborhood school. I think when people get mad about income inequality, for the most part they’re reacting to that sort competition for limited resources in American neighborhoods. And the “rich people” that are competing for those resources aren’t billionaires, but the upper middle class.

flashgordon 6y ago
""" But the Facebook engineer making $500,000/year? They’re the ones buying up the houses and driving middle class people out of neighborhoods. """ Wait this sounds like demonizing the FB engineer for making the 500k even though he would now have to pay millions for a medium size/class/type home that was previously owned by (and sold for) a crazy amount by said "middle class". I get very worried when I see this sentiment where somehow the employees of these companies are responsible for killing the previous fabric but what is driving them to these decisions is somehow sacred?
- bhupy 6y ago
  I wouldn’t call it “demonizing”, per se, but it’s a real phenomenon. I live in Brooklyn where rent isn’t the cheapest. The rents aren’t driven up because I’m in a bidding war with Jeff Bezos; they’re driven up because I’m in a bidding war with other high earning millennial yuppies. The blue collar “middle class” worker doesn’t stand a chance in our neighborhood. In contrast, my folks live in Wisconsin, where the same blue collar “middle class” worker probably doesn’t care about rent bidding wars because they just put a down payment on a nice starter home.

a2h 6y ago

I think that was the point at which I stopped watching as it was utterly shocking how much of a disconnect there is there. Thank you for sharing the Robin Williams clip, I had not seen that before and found it hilarious and perfectly fitting.