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That doesn't describe most generational wealth. A family house is generational wealth. Most people who at age 65-75 are worth over $1 million dollars didn't ge

That doesn't describe most generational wealth. A family house is generational wealth. Most people who at age 65-75 are worth over $1 million dollars didn't get there by using the power of law to stay on top or profiteering from slavery or genocide. That's insane.

anonymouskimmer 4y ago
> didn't get there by using the power of law NIMBYism is the power of law. Mortgage interest deduction is the power of law. Without either, that million dollars of wealth, much of it in the home, would be a lot less.
- ameister14 4y ago
  Even if I take that as true, it's still not "using the power of law" to follow the law. "Using the power of law" implies some degree of control over the law.
  - anonymouskimmer 4y ago
    People vote, and on some issues they vote as blocks.
  - wootland 4y ago
    I said "power law" not "power of law", meaning winner take all. https://en.wikipedia.org/wiki/Power_law https://en.wikipedia.org/wiki/Power_law
    - ameister14 4y ago
      That's not what the power law means, though. It's not a thing you 'use' to stay on top. It describes things, it doesn't influence things. Just because 20% earn 80% doesn't mean that you can use the Pareto distribution to keep in that 20%.
      - wootland 4y ago
        In capitalism it does mean that you use it to stay on top. You attract more capital, build more moats, consolidate more competitors, exploit more labor... It's why we have a winner takes all economy with record high wealth inequality.
        ameister14 4y ago
        No. You use moats, consolidation and capital to stay on top. You don't use the power law. I think there's a basic misunderstanding here. If I say that you are in the 80th percentile, that doesn't mean anything other than you are, right at this moment, in the 80th percentile. It doesn't say anything about your position in the future, and even if it says that the 80th percentile will still be there in the future you may not be in it. You can't use the fact that I have described your position to maintain your position.
        wootland 4y ago
        Incorrect. If you're in the 80th percentile, you're permanently locked out of opportunities available to those in the 99th percentile because they can build effective barriers with their capital. I'm hardly the first to say this, it's well trod territory. Here's some basics if you want to read up on it: https://www.aeaweb.org/articles?id=10.1257/jep.30.1.185 https://www.aeaweb.org/articles?id=10.1257/jep.30.1.185
        ameister14 4y ago
        That's not because of the power law, though. That's because of the circumstances that give rise to the power law. I'm saying that the power law does not cause any of this. Did you not read what you linked? It deals with the causes of power laws in economics, it does not by any means say that power laws cause stagnancy among the relevant population. It does not say this because that would make no sense. Power laws when applied to economics are an indicator that there are underlying processes (effective barriers with capital may be one) that cause the distribution to look this way. They are an illustration, not a cause.
- s1artibartfast 4y ago
  I think it's a mixed bag. Without progressive taxation regimes and property tax, I would expect those people to have much more wealth, not less.
  - anonymouskimmer 4y ago
    The very top, sure. But there are effects all down the ladder, and at some point the effects of the laws stop helping build wealth and start hurting it. Some of these taxation regimes are functionally regressive, at least at the top. https://www.forbes.com/sites/eriksherman/2023/03/26/financial-aid-to-the-wealthy-first-poor-last/?sh=3004e4884506 https://www.forbes.com/sites/eriksherman/2023/03/26/financia... > The reason most people don’t get the mortgage interest benefit is because claiming it requires itemizing tax deductions rather than using the standard deduction. But to itemize, you need enough deductions. In 2019, the Tax Foundation estimated how many people itemized after those big tax changes in 2017 that made it harder for most taxpayers to do so. It was 13.7%, or more than 17 percentage points lower than before the 2017 law. > Desmond pointed to a National Bureau of Economic Research study from 2015. Even at that point, about $195 billion of the $270 billion the federal government spent on housing was in the form of these tax code-based deductions. The remaining $75 billion is spent on the poor, or less than a third as much. > That $195 billion now is for the people who can claim it on their taxes, or less than 14% of the tax paying population.
    - s1artibartfast 4y ago
      >But there are effects all down the ladder, and at some point the effects of the laws stop helping build wealth and start hurting it. This was actually the point I was trying to make. It depends on how you look at it, but by one measure, taxes on net are slowing the wealth accumulation of everyone who pays more than the national average tax. Those who pay less than the average are typically living hand to mouth and not accumulating wealth. When you look at where tax revenue comes from, it is mostly the high earners that are paying for everything, offsetting the their wealth accumulation. Even despite factors like itemized tax deductions, your high earner will still be paying far more than your low earner. For example, the federal rate of 37% on income over 500k will still be far more than 12% on less than 41k, even with tax deductions. There are of course some factors that offset this, like maintaining the rule of law, education, and property rights which help lift all boats, rich and poor.

anonymouskimmer 4y ago

> didn't get there by using the power of law NIMBYism is the power of law. Mortgage interest deduction is the power of law. Without either, that million dollars of wealth, much of it in the home, would be a lot less.

ameister14 4y ago
Even if I take that as true, it's still not "using the power of law" to follow the law. "Using the power of law" implies some degree of control over the law.
- anonymouskimmer 4y ago
  People vote, and on some issues they vote as blocks.
- wootland 4y ago
  I said "power law" not "power of law", meaning winner take all. https://en.wikipedia.org/wiki/Power_law https://en.wikipedia.org/wiki/Power_law
  - ameister14 4y ago
    That's not what the power law means, though. It's not a thing you 'use' to stay on top. It describes things, it doesn't influence things. Just because 20% earn 80% doesn't mean that you can use the Pareto distribution to keep in that 20%.
    - wootland 4y ago
      In capitalism it does mean that you use it to stay on top. You attract more capital, build more moats, consolidate more competitors, exploit more labor... It's why we have a winner takes all economy with record high wealth inequality.
      - ameister14 4y ago
        No. You use moats, consolidation and capital to stay on top. You don't use the power law. I think there's a basic misunderstanding here. If I say that you are in the 80th percentile, that doesn't mean anything other than you are, right at this moment, in the 80th percentile. It doesn't say anything about your position in the future, and even if it says that the 80th percentile will still be there in the future you may not be in it. You can't use the fact that I have described your position to maintain your position.
        wootland 4y ago
        Incorrect. If you're in the 80th percentile, you're permanently locked out of opportunities available to those in the 99th percentile because they can build effective barriers with their capital. I'm hardly the first to say this, it's well trod territory. Here's some basics if you want to read up on it: https://www.aeaweb.org/articles?id=10.1257/jep.30.1.185 https://www.aeaweb.org/articles?id=10.1257/jep.30.1.185
        ameister14 4y ago
        That's not because of the power law, though. That's because of the circumstances that give rise to the power law. I'm saying that the power law does not cause any of this. Did you not read what you linked? It deals with the causes of power laws in economics, it does not by any means say that power laws cause stagnancy among the relevant population. It does not say this because that would make no sense. Power laws when applied to economics are an indicator that there are underlying processes (effective barriers with capital may be one) that cause the distribution to look this way. They are an illustration, not a cause.
s1artibartfast 4y ago
I think it's a mixed bag. Without progressive taxation regimes and property tax, I would expect those people to have much more wealth, not less.
- anonymouskimmer 4y ago
  The very top, sure. But there are effects all down the ladder, and at some point the effects of the laws stop helping build wealth and start hurting it. Some of these taxation regimes are functionally regressive, at least at the top. https://www.forbes.com/sites/eriksherman/2023/03/26/financial-aid-to-the-wealthy-first-poor-last/?sh=3004e4884506 https://www.forbes.com/sites/eriksherman/2023/03/26/financia... > The reason most people don’t get the mortgage interest benefit is because claiming it requires itemizing tax deductions rather than using the standard deduction. But to itemize, you need enough deductions. In 2019, the Tax Foundation estimated how many people itemized after those big tax changes in 2017 that made it harder for most taxpayers to do so. It was 13.7%, or more than 17 percentage points lower than before the 2017 law. > Desmond pointed to a National Bureau of Economic Research study from 2015. Even at that point, about $195 billion of the $270 billion the federal government spent on housing was in the form of these tax code-based deductions. The remaining $75 billion is spent on the poor, or less than a third as much. > That $195 billion now is for the people who can claim it on their taxes, or less than 14% of the tax paying population.
  - s1artibartfast 4y ago
    >But there are effects all down the ladder, and at some point the effects of the laws stop helping build wealth and start hurting it. This was actually the point I was trying to make. It depends on how you look at it, but by one measure, taxes on net are slowing the wealth accumulation of everyone who pays more than the national average tax. Those who pay less than the average are typically living hand to mouth and not accumulating wealth. When you look at where tax revenue comes from, it is mostly the high earners that are paying for everything, offsetting the their wealth accumulation. Even despite factors like itemized tax deductions, your high earner will still be paying far more than your low earner. For example, the federal rate of 37% on income over 500k will still be far more than 12% on less than 41k, even with tax deductions. There are of course some factors that offset this, like maintaining the rule of law, education, and property rights which help lift all boats, rich and poor.