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Aren't you assuming a zero sum economy without growth? The four men in the article all created their own wealth, they didn't steal it, so this seems like a pret

by nvm0n2 3y ago

Aren't you assuming a zero sum economy without growth? The four men in the article all created their own wealth, they didn't steal it, so this seems like a pretty poor situation to try and make the argument that wealth inequality must always create "real victims".

slg 3y ago
The economy is neither zero-sum nor completely not zero-sum. The easiest way to prove that is to look at a company like Tesla. Do you think their entire market cap is newly created value? For that to be the case, everyone who purchased a Tesla wouldn't have purchased any other car if Tesla didn't exist. As soon as we acknowledge that Tesla has siphoned off customers from other companies, we acknowledge that there is at least some zero-sum nature to the economy. Then you just have to start looking for other places that this partial zero-sum situation exists such as employeer-employee relationships at Musk's companies and that brings us back to wealth inequality.
- nvm0n2 3y ago
  I don't follow. Let's presume the rational markets hypothesis for now (dubious in the case of Tesla but it's not important here). Then the value created by Tesla is not people owning cars who previously didn't, but the increased quality or value of the cars vs what they otherwise would have had. Whilst individual purchasing decisions are zero-sum in the moment i.e. if someone spends X on a Tesla they can't then spend X on anything else, that doesn't mean Tesla siphons customers from every other company in the world (why restrict to cars?). Rather, in the long term other companies get more competitive, increasing the value of all cars, and people get "richer" because now they can drive more/better/their air is cleaner/whatever, and Tesla also get richer, so wealth has been created. An individual micro-economic transaction on that day may be zero sum, but the whole economy overall isn't unless there's no growth.
  - slg 3y ago
    >An individual micro-economic transaction on that day may be zero sum, but the whole economy overall isn't unless there's no growth. As I said, the economy is neither zero-sum nor completely not zero-sum. It exists somewhere in between. If you can recognize that individual microeconomic situations can be zero-sum, you should be able to recognize that some macroeconomic situations are zero-sum. I'm not arguing that these guys didn't create any wealth. I am arguing that their wealth is not equal to the value they created. Some of their wealth is wealth they captured from other people. I think it is pretty obvious that stockholders of other automakers would have more wealth in a world without Tesla. Musk now captures that wealth for Tesla stockholders. The same situation plays out for other people in Musk's orbit. The rest of the automakers are now producing fewer cars due to the presence of Tesla, therefore they are employing fewer people. Musk is extremely anti-union while many of his competitors have a unionized workforce. This allows him to treat his employees worse off. His wealth is therefore effectively coming from workers who are now in a worse situation than they were if Tesla didn't exist and those employees were working for another automakers.
TFYS 3y ago
They didn't create that wealth, they were just in a position of power that enabled them to take a portion of the wealth created by many others. The wealth actually created by the contribution of these men doesn't have much to do with how much wealth they were rewarded with. If a king sees some unworked land and orders some servants to grow food on it, does the king create the food?
- nvm0n2 3y ago
  This is a very "ugh capitalism" take. Of course they created that wealth, what position of power did any of these guys have when they started? Comparing these guys to kings is absurd. Zuckerberg was literally a student in a dorm room. Musk was an immigrant from South Africa who taught himself programming. Andreessen was just an ordinary programmer who interned at IBM. Thiel is the maybe the closest to this, being a finance guy who went to Stanford Law and was able to casually raise a million bucks to start a VC fund from friends and family. But losing a million bucks is easy. Thiel didn't lose it, he made it back many times over. None of these guys had any power. They created the wealth mostly by writing useful hardware and software, but also by locating, recruiting and organizing other people who could also create useful software.
  - TFYS 3y ago
    No power? What do you call the ability to control what thousands of people do with their time? Ownership is power. Capital is power. Most of that wealth wouldn't exist without all the people who worked for their companies to create it. The reason they get to keep such a large portion of it is not because they create it, but because they have the power to get rid of anyone who demands a fair share. Sure, they've done a lot of hard and important work to get the companies where they are now, but that work is not worth billions. It's normal work not much different from the work employees do for these companies.

by nvm0n2 3y ago

slg 3y ago

The economy is neither zero-sum nor completely not zero-sum. The easiest way to prove that is to look at a company like Tesla. Do you think their entire market cap is newly created value? For that to be the case, everyone who purchased a Tesla wouldn't have purchased any other car if Tesla didn't exist. As soon as we acknowledge that Tesla has siphoned off customers from other companies, we acknowledge that there is at least some zero-sum nature to the economy. Then you just have to start looking for other places that this partial zero-sum situation exists such as employeer-employee relationships at Musk's companies and that brings us back to wealth inequality.

nvm0n2 3y ago
I don't follow. Let's presume the rational markets hypothesis for now (dubious in the case of Tesla but it's not important here). Then the value created by Tesla is not people owning cars who previously didn't, but the increased quality or value of the cars vs what they otherwise would have had. Whilst individual purchasing decisions are zero-sum in the moment i.e. if someone spends X on a Tesla they can't then spend X on anything else, that doesn't mean Tesla siphons customers from every other company in the world (why restrict to cars?). Rather, in the long term other companies get more competitive, increasing the value of all cars, and people get "richer" because now they can drive more/better/their air is cleaner/whatever, and Tesla also get richer, so wealth has been created. An individual micro-economic transaction on that day may be zero sum, but the whole economy overall isn't unless there's no growth.
- slg 3y ago
  >An individual micro-economic transaction on that day may be zero sum, but the whole economy overall isn't unless there's no growth. As I said, the economy is neither zero-sum nor completely not zero-sum. It exists somewhere in between. If you can recognize that individual microeconomic situations can be zero-sum, you should be able to recognize that some macroeconomic situations are zero-sum. I'm not arguing that these guys didn't create any wealth. I am arguing that their wealth is not equal to the value they created. Some of their wealth is wealth they captured from other people. I think it is pretty obvious that stockholders of other automakers would have more wealth in a world without Tesla. Musk now captures that wealth for Tesla stockholders. The same situation plays out for other people in Musk's orbit. The rest of the automakers are now producing fewer cars due to the presence of Tesla, therefore they are employing fewer people. Musk is extremely anti-union while many of his competitors have a unionized workforce. This allows him to treat his employees worse off. His wealth is therefore effectively coming from workers who are now in a worse situation than they were if Tesla didn't exist and those employees were working for another automakers.

TFYS 3y ago

They didn't create that wealth, they were just in a position of power that enabled them to take a portion of the wealth created by many others. The wealth actually created by the contribution of these men doesn't have much to do with how much wealth they were rewarded with. If a king sees some unworked land and orders some servants to grow food on it, does the king create the food?

nvm0n2 3y ago
This is a very "ugh capitalism" take. Of course they created that wealth, what position of power did any of these guys have when they started? Comparing these guys to kings is absurd. Zuckerberg was literally a student in a dorm room. Musk was an immigrant from South Africa who taught himself programming. Andreessen was just an ordinary programmer who interned at IBM. Thiel is the maybe the closest to this, being a finance guy who went to Stanford Law and was able to casually raise a million bucks to start a VC fund from friends and family. But losing a million bucks is easy. Thiel didn't lose it, he made it back many times over. None of these guys had any power. They created the wealth mostly by writing useful hardware and software, but also by locating, recruiting and organizing other people who could also create useful software.
- TFYS 3y ago
  No power? What do you call the ability to control what thousands of people do with their time? Ownership is power. Capital is power. Most of that wealth wouldn't exist without all the people who worked for their companies to create it. The reason they get to keep such a large portion of it is not because they create it, but because they have the power to get rid of anyone who demands a fair share. Sure, they've done a lot of hard and important work to get the companies where they are now, but that work is not worth billions. It's normal work not much different from the work employees do for these companies.