5 ms·

Growing income inequality is driving public mistrust

46 points by moose_man 3y ago

ericra 3y ago
https://archive.is/EEyv9 https://archive.is/EEyv9
deleted 3y ago
[deleted]
joshcsimmons 3y ago
Glad to see this getting some more mainstream traction. I'm hopeful something will change. After this past year of layoffs it seems as though CEOs despite being paid 344x the average worker aren't actually taking 344x the risk.
- dheera 3y ago
  Aren't average workers taking more risk (of getting laid without warning, of losing healthcare suddenly, etc.)?
losvedir 3y ago
I can't read the article so I'm just going by the headline... I was thinking about this over Christmas break. My wife and I live in Hammond, IN, a poor town near Gary and we were visiting my in-laws in Boca Raton, FL. Until then, I had thought of income inequality in terms of billionaires and outliers. But as I walked the beautiful sidewalks along the pristine manicured landscapes between the gorgeous library I was working out of to the nearby Starbucks and Jamba Juice as BMWs, Teslas, and even a couple Ferraris passed, I realized there's definitely a lower level inequality as well. Where everyone in the town is just a bit richer than everyone in my town. We don't have spectacular libraries and great walking paths. It was just kind of weird where everyone is "rich", even if no one is a billionaire. (There very well could be billionaires, too, but I don't think they would change much of what I was thinking. Billionaire inequality issues are like having too much power, that sort of thing.)
- ryandrake 3y ago
  The billionaires really, really want you to perceive this distinction as a real inequality problem. When people making $30K are resenting/fighting people making $300K, the people making $300M are sitting back and laughing. There's really not much of a difference between the lifestyles of Hammond, IN vs. Boca Raton, FL. I mean, there's a difference, but the difference is tiny compared to the difference between them and the people whose next 5 generations can buy anything they want, have any lifestyle they want, and never have to work a day in their lives. The Hammond and Boca people both have to work for a living, they both haven't saved enough for retirement, they are both leveraged uncomfortably, they both are worried about the future for their kids. None of that is true for the billionaires. Just because one has Jamba Juice doesn't mean they're very different.
  - nwiswell 3y ago
    > The billionaires really, really want you to perceive this distinction as a real inequality problem. When people making $30K are resenting/fighting people making $300K, the people making $300M are sitting back and laughing. But that is inequality, too. Just as a thought experiment, if you were to take the global GDP and spread it perfectly evenly over every person on the planet, you'd have less than $13k per capita. That's around half of the income per capita in Hammond. I think there's a perception that there's this massive hoard of wealth at the very top, and if only we could distribute it more fairly, we could solve a bevy of social ills. It's not that simple. It's absolutely true that there are some unbelievably wealthy people, but they are also small in number. If you were to magically disgorge, say, every American with $50M+ of 90% of their wealth, you'd be lucky to be able to use the proceeds to raise all the Hammonds to the living standards of all the Boca Ratons, which as far as you're concerned here, does not really change their lifestyles. Honestly I'm much more disgusted that billionaires exist while there are infants dying of malnutrition than I am disgusted that billionaires exist while there's people worried about their kids and their retirement. Those sorts of things are really unavoidable as long as we're grappling with scarcity.
    - bix6 3y ago
gumballindie 3y ago
Major problem in the UK, which unfortunately wants to solve the issue by making everyone poorer.
ericra 3y ago
Curious to not see inheritance/estate taxes listed among the possible solutions here, but I guess that a "wealth tax" could indirectly address this by whittling away at large fortunes over time while people are still alive. This may help avoid the issue of people using trusts to sidestep estate taxes (although I'm sure they would find a way!). More generally, I highly recommend any of Thomas Piketty's books for detailed discussion about the history, causes, and consequences of inequality. They are exceptionally well-researched. And while you may not agree with all proposed solutions, they are well-written (and well-translated into English) and provide a great historical overview.
- pmichaud 3y ago
  I'm not an expert here but my understanding is that most generational wealth is gone by the third generation anyway. Even if you outlawed inheritance entirely it seems like it wouldn't make a huge marginal difference?
  - jauntywundrkind 3y ago
    I don't think there's been 3 generations to test this across, since the post-war boom. Sure there's data from before, but society hasn't been "at scale" for very long. It sure seems like the recently emerged mega-economies have a few star powers, ever consolidating their hold. Squeezing out other wealthy families isn't helping the total distribution, if that is the case. Companies keep getting bigger and bigger & the ultra rich get ultra-richer. Families could keep falling like flies, but wealth could still be ever more owned by ultra-wealthy.
  - vlovich123 3y ago
    Historically true but definitely not once rich people figured it out. They created all sorts of financial and societal instruments to solidify this (various trusts and non profits as examples). There are many many families that are much older than 3 generations at this point.
  - gumby 3y ago
    Today's rich families in Florence, Italy, were rich 700 years ago: https://www.vox.com/2016/5/18/11691818/barone-mocetti-florence https://www.vox.com/2016/5/18/11691818/barone-mocetti-floren... Inheritance in a republic is disgraceful.
tagh 3y ago
There's something ironic about charging $75/month for this article.
- nadermx 3y ago
  $75 a month seems ludacris
mortenjorck 3y ago
Just the first sentence is a bit of an eye-opener: > This year’s World Economic Forum at Davos is focused on the theme of “rebuilding trust”. That this would be the theme chosen for Davos in 2024 speaks volumes about the state of institutions post-2020.
- paul_n 3y ago
  What exactly is eye opening for you with that statement? I’m not connecting your dots..
akira2501 3y ago
No.. it's not the people meeting at Davos who are largely responsible for creating the social conditions that drive income inequality. It's income inequality _itself_. Well, notify Interpol and get a warrant! :|
wilshiredetroit 3y ago
Chamath Palihapitiya had some interesting comments about this topic that I think you guys might enjoy: Narrative violation for the "progressive" left: The American Dream is alive and well. 12% of American Families are now Millionaires "Perhaps most noteworthy, there really are a lot of true millionaires. About 16 million American families—just over 12%—have wealth exceeding $1 million, up from 9.8 million families in 2019. Nearly eight million families are multimillionaires, i.e., their wealth exceeds $2 million, up from 4.7 million." Who are mini-millionaires? "They generally earn between $150,000 and $250,000 a year. Rather than being left behind as all the gains in the economy accrue to billionaires, they have in fact seen bigger wealth gains over the past three years than the top 10% of families." Who saw the biggest gains in wealth? "Indeed, the biggest wealth gains between 2019 and 2022 were among the approximately 13 million families in the 80th to 90th percentile of the income distribution. Their median wealth jumped 69% from 2019, adjusted for inflation, to $747,000 in 2022." https://twitter.com/chamath/status/1718016818118553622 https://twitter.com/chamath/status/1718016818118553622 here is a snippet from the allinpodcast thats related.. https://www.instagram.com/reel/C1VXuOAyBqz/ https://www.instagram.com/reel/C1VXuOAyBqz/ definitely worth the 2 mins
- orwin 3y ago
  Not interested enough to check the veracity of those claims, but my grandfather somehow had 2/3rd or more of his wealth in non-public traded companies from different countries, and that part seems to be a pain to evaluate (it has been 5 years and my family is nowhere close, because at least 3 of them are wankers who want to avoid paying their fair share of taxes, and there seems to be contractual issues with disclosure). The wealth you see in Forbes or Fortune is only a part of the existing wealth.

46 points by moose_man 3y ago

ericra 3y ago

https://archive.is/EEyv9 https://archive.is/EEyv9

deleted 3y ago

[deleted]

joshcsimmons 3y ago

Glad to see this getting some more mainstream traction. I'm hopeful something will change. After this past year of layoffs it seems as though CEOs despite being paid 344x the average worker aren't actually taking 344x the risk.

dheera 3y ago
Aren't average workers taking more risk (of getting laid without warning, of losing healthcare suddenly, etc.)?

losvedir 3y ago

I can't read the article so I'm just going by the headline... I was thinking about this over Christmas break. My wife and I live in Hammond, IN, a poor town near Gary and we were visiting my in-laws in Boca Raton, FL. Until then, I had thought of income inequality in terms of billionaires and outliers. But as I walked the beautiful sidewalks along the pristine manicured landscapes between the gorgeous library I was working out of to the nearby Starbucks and Jamba Juice as BMWs, Teslas, and even a couple Ferraris passed, I realized there's definitely a lower level inequality as well. Where everyone in the town is just a bit richer than everyone in my town. We don't have spectacular libraries and great walking paths. It was just kind of weird where everyone is "rich", even if no one is a billionaire. (There very well could be billionaires, too, but I don't think they would change much of what I was thinking. Billionaire inequality issues are like having too much power, that sort of thing.)

ryandrake 3y ago
The billionaires really, really want you to perceive this distinction as a real inequality problem. When people making $30K are resenting/fighting people making $300K, the people making $300M are sitting back and laughing. There's really not much of a difference between the lifestyles of Hammond, IN vs. Boca Raton, FL. I mean, there's a difference, but the difference is tiny compared to the difference between them and the people whose next 5 generations can buy anything they want, have any lifestyle they want, and never have to work a day in their lives. The Hammond and Boca people both have to work for a living, they both haven't saved enough for retirement, they are both leveraged uncomfortably, they both are worried about the future for their kids. None of that is true for the billionaires. Just because one has Jamba Juice doesn't mean they're very different.
- nwiswell 3y ago
  > The billionaires really, really want you to perceive this distinction as a real inequality problem. When people making $30K are resenting/fighting people making $300K, the people making $300M are sitting back and laughing. But that is inequality, too. Just as a thought experiment, if you were to take the global GDP and spread it perfectly evenly over every person on the planet, you'd have less than $13k per capita. That's around half of the income per capita in Hammond. I think there's a perception that there's this massive hoard of wealth at the very top, and if only we could distribute it more fairly, we could solve a bevy of social ills. It's not that simple. It's absolutely true that there are some unbelievably wealthy people, but they are also small in number. If you were to magically disgorge, say, every American with $50M+ of 90% of their wealth, you'd be lucky to be able to use the proceeds to raise all the Hammonds to the living standards of all the Boca Ratons, which as far as you're concerned here, does not really change their lifestyles. Honestly I'm much more disgusted that billionaires exist while there are infants dying of malnutrition than I am disgusted that billionaires exist while there's people worried about their kids and their retirement. Those sorts of things are really unavoidable as long as we're grappling with scarcity.
  - bix6 3y ago

gumballindie 3y ago

Major problem in the UK, which unfortunately wants to solve the issue by making everyone poorer.

ericra 3y ago

Curious to not see inheritance/estate taxes listed among the possible solutions here, but I guess that a "wealth tax" could indirectly address this by whittling away at large fortunes over time while people are still alive. This may help avoid the issue of people using trusts to sidestep estate taxes (although I'm sure they would find a way!). More generally, I highly recommend any of Thomas Piketty's books for detailed discussion about the history, causes, and consequences of inequality. They are exceptionally well-researched. And while you may not agree with all proposed solutions, they are well-written (and well-translated into English) and provide a great historical overview.

pmichaud 3y ago
I'm not an expert here but my understanding is that most generational wealth is gone by the third generation anyway. Even if you outlawed inheritance entirely it seems like it wouldn't make a huge marginal difference?
- jauntywundrkind 3y ago
  I don't think there's been 3 generations to test this across, since the post-war boom. Sure there's data from before, but society hasn't been "at scale" for very long. It sure seems like the recently emerged mega-economies have a few star powers, ever consolidating their hold. Squeezing out other wealthy families isn't helping the total distribution, if that is the case. Companies keep getting bigger and bigger & the ultra rich get ultra-richer. Families could keep falling like flies, but wealth could still be ever more owned by ultra-wealthy.
- vlovich123 3y ago
  Historically true but definitely not once rich people figured it out. They created all sorts of financial and societal instruments to solidify this (various trusts and non profits as examples). There are many many families that are much older than 3 generations at this point.
- gumby 3y ago
  Today's rich families in Florence, Italy, were rich 700 years ago: https://www.vox.com/2016/5/18/11691818/barone-mocetti-florence https://www.vox.com/2016/5/18/11691818/barone-mocetti-floren... Inheritance in a republic is disgraceful.

tagh 3y ago

There's something ironic about charging $75/month for this article.

nadermx 3y ago
$75 a month seems ludacris

mortenjorck 3y ago

Just the first sentence is a bit of an eye-opener: > This year’s World Economic Forum at Davos is focused on the theme of “rebuilding trust”. That this would be the theme chosen for Davos in 2024 speaks volumes about the state of institutions post-2020.

paul_n 3y ago
What exactly is eye opening for you with that statement? I’m not connecting your dots..

akira2501 3y ago

No.. it's not the people meeting at Davos who are largely responsible for creating the social conditions that drive income inequality. It's income inequality _itself_. Well, notify Interpol and get a warrant! :|

wilshiredetroit 3y ago

Chamath Palihapitiya had some interesting comments about this topic that I think you guys might enjoy: Narrative violation for the "progressive" left: The American Dream is alive and well. 12% of American Families are now Millionaires "Perhaps most noteworthy, there really are a lot of true millionaires. About 16 million American families—just over 12%—have wealth exceeding $1 million, up from 9.8 million families in 2019. Nearly eight million families are multimillionaires, i.e., their wealth exceeds $2 million, up from 4.7 million." Who are mini-millionaires? "They generally earn between $150,000 and $250,000 a year. Rather than being left behind as all the gains in the economy accrue to billionaires, they have in fact seen bigger wealth gains over the past three years than the top 10% of families." Who saw the biggest gains in wealth? "Indeed, the biggest wealth gains between 2019 and 2022 were among the approximately 13 million families in the 80th to 90th percentile of the income distribution. Their median wealth jumped 69% from 2019, adjusted for inflation, to $747,000 in 2022." https://twitter.com/chamath/status/1718016818118553622 https://twitter.com/chamath/status/1718016818118553622 here is a snippet from the allinpodcast thats related.. https://www.instagram.com/reel/C1VXuOAyBqz/ https://www.instagram.com/reel/C1VXuOAyBqz/ definitely worth the 2 mins

orwin 3y ago
Not interested enough to check the veracity of those claims, but my grandfather somehow had 2/3rd or more of his wealth in non-public traded companies from different countries, and that part seems to be a pain to evaluate (it has been 5 years and my family is nowhere close, because at least 3 of them are wankers who want to avoid paying their fair share of taxes, and there seems to be contractual issues with disclosure). The wealth you see in Forbes or Fortune is only a part of the existing wealth.