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Too Hot for TED: Income Inequality

189 points by spenrose 14y ago

vannevar 14y ago
While I wholeheartedly agree with the reasoning presented in the talk, I can see why TED chose not to distribute it. It presents a pretty conventional argument for progressive taxation, without bringing any new facts or insight to the table. Historically, there is no evidence of a significant correlation between top tax rates and economic growth. Whether you believe taxes help or hurt the economy is strictly a matter of faith---conservatives hold one opinion unsupported by the facts, liberals another. Unfortunately this talk doesn't shed any additional light on the matter.
- dalai 14y ago
  Perhaps it is not a very new or well supported argument, but this is not why TED chose not to show it. The TED curator basically admits that he doesn't agree with the idea and that he also finds it too partisan to distribute. I would be worried if it is really being cut because the curator doesn't agree with it. Now as to whether it is partisan or not, this is not the first TED talk that has that "issue", there are TED talks about creationism, atheism, global warming, contraception, etc.
  - roel_v 14y ago
    Eh, no. He agrees with the idea, and exactly because it's too partisan, doesn't want to distribute it. As he should.
- baddox 14y ago
  Not to mention that people may reasonably disagree on the definition of "strong economy," and if having a "strong economy" is even a high priority compared to, say, personal liberty or socioeconomic equality.
- gwright 14y ago
  I don't know about 'strictly a matter of faith'. There is some pretty good evidence that 100% taxation (i.e. 100% of your earnings belong to the state and not to you) doesn't work to well. I'm not suggesting that there aren't reasonable arguments about what the marginal tax rate curve should look like (flat, curved, etc.) to optimize various economic metrics--just that there are some configurations that we can rule out as unworkable without much real controversy.
lancewiggs 14y ago
It's a good argument, but expressed using political code words (job creators has been co-opted) and without numbers to back it up. I feel he blew his chance to get the message out. I also feel that most TED watchers already know this argument.
brudgers 14y ago
Niall Ferguson talking about how the wealth disparity of the "West" relative to the rest of the world is justified with his typical economic moralism. http://www.ted.com/talks/niall_ferguson_the_6_killer_apps_of_prosperity.html http://www.ted.com/talks/niall_ferguson_the_6_killer_apps_of... Wonderfully, it is part of the "Rethinking Poverty" Theme: http://www.ted.com/themes/rethinking_poverty.html http://www.ted.com/themes/rethinking_poverty.html
- theorique 14y ago
  I never get tired of Niall Ferguson.
- nooneelse 14y ago
  It seems to me that many of Ferguson's heavy-lifting abstractions/generalizations go just as under-quantified and un-backed-up as Hanauer's. And several times, when Ferguson does show numbers, the "why did he pare down the dataset?" or choose that particular measure questions go unremarked. For instance, he mentions the difference between land-ownership in North and South America, but leaves out the wealthy European countries which were explicitly part of his explanandum.
tommorris 14y ago
TED: Ideas worth spreading, so long as they don't challenge the power of the 1%.
- Gilpo 14y ago
  Ooo. I like that. "Ideas worth spreading... to the peasants."
- smsm42 14y ago
  The idea of "tax the rich" is hardly needs or worth spreading - you can't open a newspaper or turn on the TV without seeing another extremely well paid TV pundit preaching it to you. It's not new, not original, not revealing and not illuminating. It's something you can read in any speech of any left-wing politician. I'm glad TED refuses to become a platform for election-campaign speeches and resists hijacking its platform for opportunist political purposes - be it left wing or right wing or any other wing politics. There are more appropriate forums for that.
  - tommorris 14y ago
    So all the libertarian sea-steading, private space missions and transhumanist Singularity madness isn't politics but just neutral science, right?
    - smsm42 14y ago
      I have very little idea what you are talking about, because your apparent attempt of being sarcastic makes it your point a bit unclear, especially when you at the same time try to put words in my mouth and assign to me points that I never made. But if you're talking about Transhumanism described here: https://en.wikipedia.org/wiki/Transhumanism https://en.wikipedia.org/wiki/Transhumanism then indeed I can see very little connection to current politics - I don't know any prominent Transhumanist politician and any currently debated law that had any Transhumanist intentions or ideas behind it. If you know any, please feel free to point them out, it would be very interesting to consider.
JackDanger 14y ago
His point is 100% right, but his argument is inappropriate for wide distribution. He's not sharing the results of a scientific study, he's not sharing a personal growthful experience, he's stating his perspective and inviting others to agree with him. It's persuasive but that's because I already agree with him. I'd like to see it backed with real data so it could be persuasive to all. Then it would be more of an "idea worth spreading" rather than "a really good idea".
horsehead 14y ago
I hate the term "the 1%" it's just a bunch of malarkey. Whether you got your money through savvy investing or hard work, it doesn't matter. What you earn, you should KEEP. I detest handouts, especially when someone tries to give them to me. Each person should get according to their work (or their ability to work. The disabled are the only ones remotely eligible for handouts, IMO). Now I'll just watch as my karma plummets for speaking my mind on something. Oh well I guess. Edit: I do think though that TED is wise not to wade into this battle. It is a very politically charged topic, especially right now.
- tommorris 14y ago
  "Savvy investing or hard work" So, you are up for some kind of strong inheritance tax to ensure that people have to work hard or invest savvily rather than just inherit money from their family. 'Cos, you know, inherited money is neither gotten "according to their work" or "earned", but rather received purely on the basis of random genetics.
  - horsehead 14y ago
    So is the fact that you have a home as a child. I don't see that your argument holds water. The fact that you live where you live is pure genetics as well. Why don't you ship your money to starving ethiopians? If you're going to argue that, then you have to be willing to give up what you have too. If you're going to talk about the 1% in America, you have to talk about the USA as the 1%, because, let's face it -- if you live in the US, you've got a hell of a chance of being better off than most of the world.
    - SideburnsOfDoom 14y ago
      > Why don't you ship your money to starving ethiopians? We do, actually. http://www.voanews.com/content/ethiopia-is-top-uk-aid-recipient-117204413/157544.html http://www.voanews.com/content/ethiopia-is-top-uk-aid-recipi... Also, you posed a false dichotomy "Whether you got your money through savvy investing or hard work" and when you were called out on this by having other options for people's money sources pointed out, said that you "don't see" and changed the subject to something emotionally charged.
webXL 14y ago
Another rich guy trying to persuade average folk that all our problems would be solved if people like him were taxed more. Never mind that the Buffet-rule (minimum 35%) would net $31 Billion over the next 11 years versus $7 Trillion in estimated deficits. (http://www.politico.com/news/stories/0312/74232.html http://www.politico.com/news/stories/0312/74232.html) Another reason this idea is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the median American, but we don't buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, we go out to eat with friends and family only occasionally. I can't buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can't buy any new clothes or cars or enjoy any meals out. But you can invest... Your money isn't stuffed under your mattress, is it?? That's why taxing the rich to pay for investments that benefit all is a great deal for both the middle class and the rich. Are they really investments or are they just political favors that over-cost and under-deliver? (See the Department of Education, TARP, Medicare, war, etc.)
- jiggy2011 14y ago
  You invest whenever you buy something from a company. Perhaps it is better to have many millions of people making small investments in the form of purchases and therefor "voting" on what is better. Rather than having a few large investors who may likely invest in stuff they never or rarely use which could have a habit of creating a bubble.
  - anon808 14y ago
    That's 100% correct. Investing by consuming products of companies scales a lot better than invest-betting on startups and financial instruments.
- shmulkey18 14y ago
  Investment: noun. Political payoff made with other people's money.
- 14y ago
petercooper 14y ago
There’s one idea, though, that TED’s organizers recently decided was too controversial to spread: the notion that widening income inequality is a bad thing for America, and that as a result, the rich should pay more in taxes. I'd suggest it's not too controversial but too pedestrian. Or maybe I'm seeing this through European eyes; ideologically, this topic/argument is mainstream here, even if politicians fail to do much about it.
- freshhawk 14y ago
  I think you are seeing this through European eyes. This is the kind of thing that gets you yelled at, threatened and told you're the "kind of [people] ruining america" if you talk about it in the US. It's not controversial among people who are educated in the subject, but among the general amerian public it's incredibly controversial.
  - toyg 14y ago
    The problem is that the feedback loop between US and Europe ends up being very unbalanced: American thinkers are hugely influential in Europe, but European ones get disqualified in the US almost by default because they're "socialists". This is a problem for us Europeans as much as for you.
    - dmpk2k 14y ago
      I was shocked how hard it is to find any books about ordoliberalism in North America, even though it was a driver of economic thought and policy in Germany for decades. The only book I found was at a major university's library, in German. It was a "WTF" moment.
    - freshhawk 14y ago
      They aren't disqualified by any thinkers you would want to listen to, but yes, in general they are. Americans, in broadly general terms, aren't interested in non-American things. Or intellectual anything. So yeah, combine those two together and you get the worst of those two general trends.
saraid216 14y ago
He would have done so much better to shop his Gardens of Democracy book around. That at least presents some new ideas that aren't talked about enough. Like vannevar, I fully agree with Nick but the talk is completely pointless. http://www.amazon.com/The-Gardens-Democracy-Citizenship-Government/dp/1570618232 http://www.amazon.com/The-Gardens-Democracy-Citizenship-Gove...
JackFr 14y ago
It reads like an "Reader's respond" column on the op-ed page in a local newspaper. The guy makes utterly standard and conventional arguments and then rests on an appeal to his authority as an whiz-bang investor. Hardly too hot for TED, more likely to set people to snoozing.
gadders 14y ago
Inequality is a stupid measure. What matters is absolute poverty. If I have a comfortable standard of living, what do I care if Bill Gates has a million times more money than me?
- njharman 14y ago
  FYI, we couldn't tax the super rich enough to end poverty let alone give everyone a comfortable living. Income equality is not about solving all problems. It's just trying to rectify one of the most egregious ones.
- baddox 14y ago
  You may not care, and I certainly wouldn't care, but the desire for absolute socioeconomic equality is extremely common. There's a word for it: "egalitarianism." Egalitarianism is a fundamental principle behind many political systems, from socialism to modern American liberalism.
- matwood 14y ago
  If I have a comfortable standard of living, what do I care if Bill Gates has a million times more money than me? Because people by their nature are jealous. Many people even hate when their friends do better than them for some reason.
- jules 14y ago
  You'd think, but as it turns out, inequality has strong negative effects to the point that even the rich in an inequal country do worse than the more poor in a more equal country. TED talk about it: http://www.ted.com/talks/richard_wilkinson.html http://www.ted.com/talks/richard_wilkinson.html
  - meej 14y ago
    I haven't seen either talk, but I am really curious now about why TED would post Wilkinson's talk but not Hanauer's, if they both address the subject income inequality.
jakubmal 14y ago
I can't believe my eyes actually. As I was opening this comments page, I thought that majority will represent vastly different opinion here. But since that's not the case, I decided to speak up. Nick Hanauer cannot be more wrong. Taxing rich people means punishing someone for his success. There is no argument that could justify such Robin Hood's behaviour. In fact that's what was (or is) happening in the communism. So regression at it's finest. I think that someone hasn't had his history homework done. The things is that the root of the problem is somewhere else. If you think about evolution for a second. Weaker species are removed, stronger survive. It leads to creating better and better species. On the other hand, if we helped weaker species to survive as well, then not only this natural filter is effectively stopped, but also ironically, the situation is even worse for the stronger ones. That would inevitably make the whole ecosystem poor. To wrap it up, if God (or some other kind of Force) decided to help poor species, we, humans, would never exist. Why don't you just support the idea, that put you into existence?
- ender7 14y ago
  Ah, Social Darwinism. Still alive after so many years.
  - jakubmal 14y ago
    Right, don't back up. Just diss.
    - potatolicious 14y ago
      I've been just watching this discussion unfold up till now - and I've been impressed at the level of analysis coming from both sides - arguments that are at least in some minor way backed up by numbers. But your comment is offensive. Dangerously so. Your view is actually incredibly typical throughout history - its latest incarnation is Social Darwinism, where one mistakenly applies a biological and genetics principle to economics and morality. Social Darwinism has been the tool with which countless people have been oppressed, abused, and killed. The pro-slavery crowd used that argument - that colored people were genetically inferior, and that if they were meant be to free, they'd already be. This line of thinking was also popular amongst the Eugenics movement in the early 20th century, which had clear and strong ties to the Nazi party (boy this argument just Godwins itself). With its colorful history, social Darwinism is nowadays inseparable from racism and fascism. But your claim is even more specious than this lot of despicable people. At least the slavers and the Nazis made arguments that certain races deserved their lot due to "inferior" genetics, but your appeal to Darwin/evolution doesn't even involve the least bit of biology. It's just pure hand-waving by applying one completely unrelated field to another, with zero facts to even attempt to back it up. Shame on you.
mikecane 14y ago
Post the damn talk and let people make up their own minds. This is a PR disaster.
mikecane 14y ago
Post the damn talk and let people make up their own minds. This is a PR disaster.
gte910h 14y ago
Why is this on Hacker news?
- spenrose 14y ago
  Because I submitted it and it got some upvotes. I submit a fair number of hey-pay-attention-to-the-political-economy-of-our-wealth links, and this is the first (?) that's gotten traction. It may be the last, and if so that's fine. Why did I submit it? My tremendous admiration for and personal gratitude to pg and the HN community is tempered by a sense that the community, composed as it is of human beings, tends to think that it deserves the good things that happen to its members. In the case of the extraordinary wealth, the good things that happen effect what we might call the political economy of ideas in the community. I thought this incident might cause a few HNers to think about that: not Hanauer's ideas, but how deals are actually closed in the proverbial marketplace of ideas in which we are all participating.
muhfuhkuh 14y ago
So, when does one prove causation? Because by any economic metric, the times when we've been fiscally strong is when the top marginal tax rate was higher than 36% currently. When they lowered it in 2001 from 40% while going to war, it created net zero jobs during the entirety of the Bush administration (and starting leaking jobs en masse during the crisis in 2008). One could argue that Reagan's administration saw some powerful growth, adding 15 million net jobs; but, again, he maintained a >50% top marginal tax rate average through his tenure. The Clinton administration growth rate was even more powerful (arguably) than Reagan's, seeing 23 million net jobs during his tenure, and that was when top marginal rates were nearly 40%. An outlier, and a very powerful one, is when we saw the largest uplift from post-war growth phase to absolute juggernaut boomtime, was during the 50s, when top marginal tax rates were 90%. Somehow, I doubt we'll ever go back to that time (both in growth and taxation), but we can see that the times of growth was when top marginal tax rates were over 40%. Dip below, no room to grow. IMHO (with evidence), of course.
- georgieporgie 14y ago
  I've heard a number of people (Grover Norquist included) make the claim that although the top marginal tax rates were higher, there were a far greater number of tax exemptions available. I have no idea how true this is, and I'm not aware of anyone who's studied the actual income, wealth, and taxes of America's rich over the decades.
  - viggity 14y ago
    Agreed, looking at top marginal rate seems weird, why not look at effective tax rates for the Top 1, 5 and 10% instead?
    - nikcub 14y ago
      because it doesn't give you the answer you want
      - muhfuhkuh 14y ago
cullen 14y ago
The case for a progressive tax scheme is that it, may reduce one incentive for the most financially successful monkeys to plunder the less financially successful monkeys, including those monkeys who may be just as smart; but, maybe got started later. To those of you who are pretending that you've done it all on your own without nobody's help and get your hands off of mine it's all mine mine mine! You're deluding yourself. I can understand why TED don't want to touch his talk. It would be interesting to note how consistent TED are in this respect.
johndbritton 14y ago
Is it possible that by not publishing the talk they'll draw more attention to it? He should re-record and publish the talk on his own and use the "Streisand Effect" in his favor. http://en.wikipedia.org/wiki/Streisand_effect http://en.wikipedia.org/wiki/Streisand_effect
- nooneelse 14y ago
  He should also use that re-record as a chance to put in more data to support his point. And flesh out his thinking. For instance, that bit about: > "If the typical American family still got today the same share of income they earned in 1980, they would earn about 25% more and have an astounding $13,000 more a year. Where would the economy be if that were the case?" I would love to see some stabs (pessimistic, median, and optimistic) at following out the economic effects of that question. What is a reasonable ratio of the $13k which would be put toward more spending, and how would that effect the demand seen by businesses, and thus the number of jobs supported?
  - mchusma 14y ago
    I would also say any attempt to discuss causation would be great. It's very light on that, and doesn't address any of the huge macro issues to contend with.
freshhawk 14y ago
So if either political party chooses to start throwing bullshit back and forth on some ideological hot button issue then TED decides that this subject is now off limits? Don't we want the people at TED to be able to share good arguments concerning precisely the things that are most important and most misunderstood (which hot button political issues are, since people now choose an opinion based on tribalism rather than reason) So that reasoning is bullshit. I don't want democrats or republicans choosing which topics are now off limits for debate because they are now political. For fucks sake, political topics are the ones that need debate. What else does "political topic" mean other than "this is important to our society and there is disagreement". So TED talks are "Riveting talks by remarkable people on subjects that have not been deemed off limits by one of the two big political parties in the US". Nevermind the fact that this clearly has nothing to do with political controversy as described, everyone knows there are talks about evolution, climate change and cosmology. The only difference is that there are likely people at TED who might disagree with this one.
mtjl79 14y ago
I'm sorry but, higher taxes aren't going to solve anything. At the end of the day, our spending will just not stop. We are just adding fuel to the fire. We need to: • Invest in the future: We need to invent, produce, and export new renewable energy sources. We need to invest in robotic manufacturing because cheap people labor is not sustainable in any country - robotic is where it will go. • We need to heavily tax imports like many other countries in the world do. And have American made things become competitive - we have sold our souls to Asia. • Drastically cut bullshit spending. There are billions spent every year on...bullshit. • Invest further in Entrepreneurship, and start bringing smart people from other countries here. Those are big 4. The big problem is our countries expenses vs. income is too high. At the end of the day, a country is a business. And right now, we are a company that is not running well. We need to clean out the board of directors (Congress) and start fresh.
- eli_gottlieb 14y ago
  At the end of the day, a country is a business. No, it's not. It needs to manage its finances responsibly, but that is quite different from being a profit-generating business.
  - mtjl79 14y ago
    Countries are the largest companies that exist on the planet.
    - eli_gottlieb 14y ago
      Quite simply, no. The goal of a country is not to amass wealth in the government.
      - mtjl79 14y ago
        Not all companies that operate are for profit. BUT, The goal of a country is to amass wealth, is it not?
mchusma 14y ago
Does anyone have global wealth/tax numbers? I'd argue that the US is not a closed system. So the % the world governments take vs GDP. This might be helpful to see if what he is suggesting is plausible.
rdl 14y ago
I don't have a big problem with income inequality, compared to wealth inequality (averaged over a long time). Consumption taxes and "death tax" (or at least a strong social convention toward donating assets in excess of a certain level, rather than heirs inheriting them) would go a long way. Income inequality is largely due to differences in economic contribution, and encouraging people at the far right of the power curve to do more (and be more numerous) produces positive externalities. The main quick fixes to the tax code which I'd like to see are immediately taxing carry as income, getting rid of deductions for employer health insurance and mortgage interest, and a national sales tax or VAT (ie consumption tax), ideally highly progressive or exempting the first 50k/yr or something. Then, look at lowering income tax rates to something like 25% flat and setting lt capital gains and dividends at slightly less (20%) or the same as income but indexed for inflation. Get rid of the AMT, and maybe lower corporate rates to try to get firms to repatriate more and avoid abusive tax structuring like the double Irish sandwich and such. A more transparent tax code, even if revenue neutral, would boost economic activity. A more transparent tax code, taxing things with negative externalities and not discouraging positive externalities, raising more income while cutting expenditures greatly, would be even better. Not that there is much chance of any of this happening.
mikecane 14y ago
Discussions like this sometimes stagger me personally. Did Dickens write for nothing? Does everyone really wish to be Scrooge or Bounderby? Did Jack London write The People of the Abyss and waste his time? How many times must we relive that age before the lessons we learned from it at that time are permanent and inarguable?
- crusso 14y ago
  Why would you think that fictional stories that would be anecdotal if real should inform anyone of anything? Real economic issues require solid statistical analysis based upon proven economic models. Anything less is just a projection of emotional bias that means little to society and would never solve anything.
  - mikecane 14y ago
    OMG. Have you also algorithmically quantified love too? And tell me what a "proven economic model" is. One where the rich have to hire working class cops in their off-hours -- depriving said cops' families of their presence -- so they can feel safe in common spaces? One in which private security and private prisons are the fastest growing employers? I've got news for you, pal, and you can shove this up your algorithms: People are not machines and, as messy as you might find this fact to be, have emotional components. Someone in the lower rungs of society might not be able to explain with a PowerPoint presentation the precise manner in which he or she is being screwed, but emotionally they can show you.
    - crusso 14y ago
      > OMG. I'll leave that there to speak for itself. > Have you also algorithmically quantified love too? I can certainly see where an emotional person who doesn't know much about economics would try to turn this into an emotional issue. It's not. It's an economic issue. The whole reason why we step from one financial mess to the next is that we don't make political decisions based upon economic forces such as supply & demand. Political decisions are typically made to benefit the power of politicians. They do so by making emotional arguments to people who don't really understand much about economics but who know how to pull a voting lever. Congratulations, that means you. > People are not machines and, as messy as you might find this fact to be, have emotional components. And this has precisely what to do with the economic health of the country?
msabalau 14y ago
What is odd to me is the parocial yardstick that the TED curator is reportedly using to judge what's controversial. "We already have Melinda Gates on contraception" With whom other than the socially conservative wing of the US Republican party is birth control "controversial"? A few thousand people in Vatican City, some other religious leaders of their ilk, and a scattering of anti-colonialist thinkers. I would have thought TED would have taken a more cosmopolitan view of what counts as controversy.
andr3w321 14y ago
Here's the text and slides to the talk. I'm sure the video will come out eventually. http://www.democraticunderground.com/101628527 http://www.democraticunderground.com/101628527 I think it's pretty ridiculous TED would not post this video. They really shouldn't be censoring things like this unless someone is just completely making things up in their talk in which case they did a poor job of picking their speaker.
fiaz 14y ago
Shame on the news media for not asking meaningful questions to people who make claims on either side of the US political spectrum. I feel as though a culture of timidity to ask questions that lead to clarifying answers is turning into a culture that politicizes the truth.
ktizo 14y ago
Here's the text of the actual speech, linked to from the article. http://roundtable.nationaljournal.com/2012/05/the-inequality-speech-that-ted-wont-show-you.php http://roundtable.nationaljournal.com/2012/05/the-inequality... To be honest, it seems to be basic common sense, if this is too controversial for TED then they are seriously losing their way. As for saying they had Melinda Gates talking about contraception around the same time and thinking that it was a reasonable excuse for backtracking. Well to me, that just doesn't even start to make the slightest bit of sense as an argument.
dgreensp 14y ago
As others have said, there is not a lot of substantiation in the talk to shed new light on frequently-discussed topics. It feels intellectually shaky to assert that the economy will go back to growing, if only the middle class can go back to spending, which we can achieve by giving more money to the government. Here's a different and more TED-like viewpoint: Perhaps economic growth actually requires movers and shakers. The US has had a good share of them. These people aren't going to be your archetypal rich fat cats, nor your average Joe living paycheck to paycheck. If they are rewarded with wealth, that is a good thing. And sure, some of that wealth can go into a pot to use for the common welfare. If we want more consumer spending, let's give people better things to spend money on, things that help them in their own quest of fulfillment and creating value. If businesses are reluctant to hire, it's only because they need to make correspondingly more money to make the hire worthwhile. As we know from start-up land, many tasks can't be done better by throwing more people at them, especially creative tasks. We're still trying to solve the problem of how individuals can cooperate and merge their individual strengths towards big goals. A full-time human ought to be a very valuable asset to a company, though, and many companies can be viewed as engines that take human effort and turn it into value, creating money. Economic growth is not to be taken for granted. It requires innovation, optimism, and positive energy that comes from individuals. There are many things rich and non-rich people can do with their time and money to help, besides just giving their money to the government. Take something you're good at and provide a service, or make something and sell it. Lend a cup of sugar to your neighbor. Earn what you're worth. Invest in good businesses. Pay someone to do something for you. And on and on.
confluence 14y ago
Relevant answer I found on Quora: http://www.quora.com/Who-creates-wealth-Entrepreneurs-investors-workers-or-all-three/answers/933836 http://www.quora.com/Who-creates-wealth-Entrepreneurs-invest... The world is more complex than a lot of the arguments that people have on this issue. One side appears quite facile and naive in their hero worship of entrepreneurs/investors at seeing/creating the future (when the chances are they merely bump into it along with many others). These are almost universally young people who are nurtured/protected by their families/society or already successful people who think they are the sole cause of their success (it's usually a combination of internal AND external factors). The other side is too oppressive and cynical, stating that entrepreneurs don't create jobs, but extract wealth. These are usually unprotected people, the poor, and the unsuccessful who just don't understand why they are trodden upon and treated like vermin to be ignored. The world isn't black or white. It looks like it is extraordinary complex with many shades of gray. Hence the best way to look at this issue is thus: If you were the down trodden upon, the poor, the unlucky, the unhealthy - How would you like the tax system to treat you? Would you like them to say: No, your situation is ALL your fault - the rich matter, we shouldn't tax them and let them create jobs for little all you. OR Yes, the rich are extraordinarily lucky to have what they have, and it would be best to share that around. Because as you all know: You had a 50% chance of being born in the rest of the world, in the darkest poverty, where nothing you did, said, or who you are meant anything because of your situation. Born in America: Billionaire. Born in Afghanistan: Your dead. What you can achieve has doesn't correlate strongly with what actually happens to you - you are made by your situation. We float with the times and environment around us - not the other way around.
- nooneelse 14y ago
  Interestingly enough, the framing of the Quora question leaves out "the buyers" as part of the critical circle for wealth creation. That is the role that, I thought, Hanauer's talk was pointing out is played by the middle class. Perhaps the Quora question meant to capture them as "the workers", but that, according to my interpretation of the talk, mislabels their most critical role.
neuro 14y ago
Americans tax payers are a trampoline for globalizing these corporations through subsidizing their R&D, bailing them out and soldiering their resources abroad. These corporations have global consumers now, the health of the American consumer isn’t a priority.

189 points by spenrose 14y ago

While I wholeheartedly agree with the reasoning presented in the talk, I can see why TED chose not to distribute it. It presents a pretty conventional argument for progressive taxation, without bringing any new facts or insight to the table. Historically, there is no evidence of a significant correlation between top tax rates and economic growth. Whether you believe taxes help or hurt the economy is strictly a matter of faith---conservatives hold one opinion unsupported by the facts, liberals another. Unfortunately this talk doesn't shed any additional light on the matter.

dalai 14y ago
Perhaps it is not a very new or well supported argument, but this is not why TED chose not to show it. The TED curator basically admits that he doesn't agree with the idea and that he also finds it too partisan to distribute. I would be worried if it is really being cut because the curator doesn't agree with it. Now as to whether it is partisan or not, this is not the first TED talk that has that "issue", there are TED talks about creationism, atheism, global warming, contraception, etc.
- roel_v 14y ago
  Eh, no. He agrees with the idea, and exactly because it's too partisan, doesn't want to distribute it. As he should.
baddox 14y ago
Not to mention that people may reasonably disagree on the definition of "strong economy," and if having a "strong economy" is even a high priority compared to, say, personal liberty or socioeconomic equality.
gwright 14y ago
I don't know about 'strictly a matter of faith'. There is some pretty good evidence that 100% taxation (i.e. 100% of your earnings belong to the state and not to you) doesn't work to well. I'm not suggesting that there aren't reasonable arguments about what the marginal tax rate curve should look like (flat, curved, etc.) to optimize various economic metrics--just that there are some configurations that we can rule out as unworkable without much real controversy.

lancewiggs 14y ago

It's a good argument, but expressed using political code words (job creators has been co-opted) and without numbers to back it up. I feel he blew his chance to get the message out. I also feel that most TED watchers already know this argument.

brudgers 14y ago

Niall Ferguson talking about how the wealth disparity of the "West" relative to the rest of the world is justified with his typical economic moralism. http://www.ted.com/talks/niall_ferguson_the_6_killer_apps_of_prosperity.html http://www.ted.com/talks/niall_ferguson_the_6_killer_apps_of... Wonderfully, it is part of the "Rethinking Poverty" Theme: http://www.ted.com/themes/rethinking_poverty.html http://www.ted.com/themes/rethinking_poverty.html

theorique 14y ago
I never get tired of Niall Ferguson.
nooneelse 14y ago
It seems to me that many of Ferguson's heavy-lifting abstractions/generalizations go just as under-quantified and un-backed-up as Hanauer's. And several times, when Ferguson does show numbers, the "why did he pare down the dataset?" or choose that particular measure questions go unremarked. For instance, he mentions the difference between land-ownership in North and South America, but leaves out the wealthy European countries which were explicitly part of his explanandum.

tommorris 14y ago

TED: Ideas worth spreading, so long as they don't challenge the power of the 1%.

Gilpo 14y ago
Ooo. I like that. "Ideas worth spreading... to the peasants."
smsm42 14y ago
The idea of "tax the rich" is hardly needs or worth spreading - you can't open a newspaper or turn on the TV without seeing another extremely well paid TV pundit preaching it to you. It's not new, not original, not revealing and not illuminating. It's something you can read in any speech of any left-wing politician. I'm glad TED refuses to become a platform for election-campaign speeches and resists hijacking its platform for opportunist political purposes - be it left wing or right wing or any other wing politics. There are more appropriate forums for that.
- tommorris 14y ago
  So all the libertarian sea-steading, private space missions and transhumanist Singularity madness isn't politics but just neutral science, right?
  - smsm42 14y ago
    I have very little idea what you are talking about, because your apparent attempt of being sarcastic makes it your point a bit unclear, especially when you at the same time try to put words in my mouth and assign to me points that I never made. But if you're talking about Transhumanism described here: https://en.wikipedia.org/wiki/Transhumanism https://en.wikipedia.org/wiki/Transhumanism then indeed I can see very little connection to current politics - I don't know any prominent Transhumanist politician and any currently debated law that had any Transhumanist intentions or ideas behind it. If you know any, please feel free to point them out, it would be very interesting to consider.

JackDanger 14y ago

His point is 100% right, but his argument is inappropriate for wide distribution. He's not sharing the results of a scientific study, he's not sharing a personal growthful experience, he's stating his perspective and inviting others to agree with him. It's persuasive but that's because I already agree with him. I'd like to see it backed with real data so it could be persuasive to all. Then it would be more of an "idea worth spreading" rather than "a really good idea".

horsehead 14y ago

I hate the term "the 1%" it's just a bunch of malarkey. Whether you got your money through savvy investing or hard work, it doesn't matter. What you earn, you should KEEP. I detest handouts, especially when someone tries to give them to me. Each person should get according to their work (or their ability to work. The disabled are the only ones remotely eligible for handouts, IMO). Now I'll just watch as my karma plummets for speaking my mind on something. Oh well I guess. Edit: I do think though that TED is wise not to wade into this battle. It is a very politically charged topic, especially right now.

tommorris 14y ago
"Savvy investing or hard work" So, you are up for some kind of strong inheritance tax to ensure that people have to work hard or invest savvily rather than just inherit money from their family. 'Cos, you know, inherited money is neither gotten "according to their work" or "earned", but rather received purely on the basis of random genetics.
- horsehead 14y ago
  So is the fact that you have a home as a child. I don't see that your argument holds water. The fact that you live where you live is pure genetics as well. Why don't you ship your money to starving ethiopians? If you're going to argue that, then you have to be willing to give up what you have too. If you're going to talk about the 1% in America, you have to talk about the USA as the 1%, because, let's face it -- if you live in the US, you've got a hell of a chance of being better off than most of the world.
  - SideburnsOfDoom 14y ago
    > Why don't you ship your money to starving ethiopians? We do, actually. http://www.voanews.com/content/ethiopia-is-top-uk-aid-recipient-117204413/157544.html http://www.voanews.com/content/ethiopia-is-top-uk-aid-recipi... Also, you posed a false dichotomy "Whether you got your money through savvy investing or hard work" and when you were called out on this by having other options for people's money sources pointed out, said that you "don't see" and changed the subject to something emotionally charged.

webXL 14y ago

Another rich guy trying to persuade average folk that all our problems would be solved if people like him were taxed more. Never mind that the Buffet-rule (minimum 35%) would net $31 Billion over the next 11 years versus $7 Trillion in estimated deficits. (http://www.politico.com/news/stories/0312/74232.html http://www.politico.com/news/stories/0312/74232.html) Another reason this idea is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the median American, but we don't buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, we go out to eat with friends and family only occasionally. I can't buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can't buy any new clothes or cars or enjoy any meals out. But you can invest... Your money isn't stuffed under your mattress, is it?? That's why taxing the rich to pay for investments that benefit all is a great deal for both the middle class and the rich. Are they really investments or are they just political favors that over-cost and under-deliver? (See the Department of Education, TARP, Medicare, war, etc.)

jiggy2011 14y ago
You invest whenever you buy something from a company. Perhaps it is better to have many millions of people making small investments in the form of purchases and therefor "voting" on what is better. Rather than having a few large investors who may likely invest in stuff they never or rarely use which could have a habit of creating a bubble.
- anon808 14y ago
  That's 100% correct. Investing by consuming products of companies scales a lot better than invest-betting on startups and financial instruments.
shmulkey18 14y ago
Investment: noun. Political payoff made with other people's money.
14y ago

petercooper 14y ago

There’s one idea, though, that TED’s organizers recently decided was too controversial to spread: the notion that widening income inequality is a bad thing for America, and that as a result, the rich should pay more in taxes. I'd suggest it's not too controversial but too pedestrian. Or maybe I'm seeing this through European eyes; ideologically, this topic/argument is mainstream here, even if politicians fail to do much about it.

freshhawk 14y ago
I think you are seeing this through European eyes. This is the kind of thing that gets you yelled at, threatened and told you're the "kind of [people] ruining america" if you talk about it in the US. It's not controversial among people who are educated in the subject, but among the general amerian public it's incredibly controversial.
- toyg 14y ago
  The problem is that the feedback loop between US and Europe ends up being very unbalanced: American thinkers are hugely influential in Europe, but European ones get disqualified in the US almost by default because they're "socialists". This is a problem for us Europeans as much as for you.
  - dmpk2k 14y ago
    I was shocked how hard it is to find any books about ordoliberalism in North America, even though it was a driver of economic thought and policy in Germany for decades. The only book I found was at a major university's library, in German. It was a "WTF" moment.
  - freshhawk 14y ago
    They aren't disqualified by any thinkers you would want to listen to, but yes, in general they are. Americans, in broadly general terms, aren't interested in non-American things. Or intellectual anything. So yeah, combine those two together and you get the worst of those two general trends.

saraid216 14y ago

He would have done so much better to shop his Gardens of Democracy book around. That at least presents some new ideas that aren't talked about enough. Like vannevar, I fully agree with Nick but the talk is completely pointless. http://www.amazon.com/The-Gardens-Democracy-Citizenship-Government/dp/1570618232 http://www.amazon.com/The-Gardens-Democracy-Citizenship-Gove...

JackFr 14y ago

It reads like an "Reader's respond" column on the op-ed page in a local newspaper. The guy makes utterly standard and conventional arguments and then rests on an appeal to his authority as an whiz-bang investor. Hardly too hot for TED, more likely to set people to snoozing.

gadders 14y ago

Inequality is a stupid measure. What matters is absolute poverty. If I have a comfortable standard of living, what do I care if Bill Gates has a million times more money than me?

njharman 14y ago
FYI, we couldn't tax the super rich enough to end poverty let alone give everyone a comfortable living. Income equality is not about solving all problems. It's just trying to rectify one of the most egregious ones.
baddox 14y ago
You may not care, and I certainly wouldn't care, but the desire for absolute socioeconomic equality is extremely common. There's a word for it: "egalitarianism." Egalitarianism is a fundamental principle behind many political systems, from socialism to modern American liberalism.
matwood 14y ago
If I have a comfortable standard of living, what do I care if Bill Gates has a million times more money than me? Because people by their nature are jealous. Many people even hate when their friends do better than them for some reason.
jules 14y ago
You'd think, but as it turns out, inequality has strong negative effects to the point that even the rich in an inequal country do worse than the more poor in a more equal country. TED talk about it: http://www.ted.com/talks/richard_wilkinson.html http://www.ted.com/talks/richard_wilkinson.html
- meej 14y ago
  I haven't seen either talk, but I am really curious now about why TED would post Wilkinson's talk but not Hanauer's, if they both address the subject income inequality.

jakubmal 14y ago

I can't believe my eyes actually. As I was opening this comments page, I thought that majority will represent vastly different opinion here. But since that's not the case, I decided to speak up. Nick Hanauer cannot be more wrong. Taxing rich people means punishing someone for his success. There is no argument that could justify such Robin Hood's behaviour. In fact that's what was (or is) happening in the communism. So regression at it's finest. I think that someone hasn't had his history homework done. The things is that the root of the problem is somewhere else. If you think about evolution for a second. Weaker species are removed, stronger survive. It leads to creating better and better species. On the other hand, if we helped weaker species to survive as well, then not only this natural filter is effectively stopped, but also ironically, the situation is even worse for the stronger ones. That would inevitably make the whole ecosystem poor. To wrap it up, if God (or some other kind of Force) decided to help poor species, we, humans, would never exist. Why don't you just support the idea, that put you into existence?

ender7 14y ago
Ah, Social Darwinism. Still alive after so many years.
- jakubmal 14y ago
  Right, don't back up. Just diss.
  - potatolicious 14y ago
    I've been just watching this discussion unfold up till now - and I've been impressed at the level of analysis coming from both sides - arguments that are at least in some minor way backed up by numbers. But your comment is offensive. Dangerously so. Your view is actually incredibly typical throughout history - its latest incarnation is Social Darwinism, where one mistakenly applies a biological and genetics principle to economics and morality. Social Darwinism has been the tool with which countless people have been oppressed, abused, and killed. The pro-slavery crowd used that argument - that colored people were genetically inferior, and that if they were meant be to free, they'd already be. This line of thinking was also popular amongst the Eugenics movement in the early 20th century, which had clear and strong ties to the Nazi party (boy this argument just Godwins itself). With its colorful history, social Darwinism is nowadays inseparable from racism and fascism. But your claim is even more specious than this lot of despicable people. At least the slavers and the Nazis made arguments that certain races deserved their lot due to "inferior" genetics, but your appeal to Darwin/evolution doesn't even involve the least bit of biology. It's just pure hand-waving by applying one completely unrelated field to another, with zero facts to even attempt to back it up. Shame on you.

mikecane 14y ago

Post the damn talk and let people make up their own minds. This is a PR disaster.

mikecane 14y ago

Post the damn talk and let people make up their own minds. This is a PR disaster.

gte910h 14y ago

Why is this on Hacker news?

spenrose 14y ago
Because I submitted it and it got some upvotes. I submit a fair number of hey-pay-attention-to-the-political-economy-of-our-wealth links, and this is the first (?) that's gotten traction. It may be the last, and if so that's fine. Why did I submit it? My tremendous admiration for and personal gratitude to pg and the HN community is tempered by a sense that the community, composed as it is of human beings, tends to think that it deserves the good things that happen to its members. In the case of the extraordinary wealth, the good things that happen effect what we might call the political economy of ideas in the community. I thought this incident might cause a few HNers to think about that: not Hanauer's ideas, but how deals are actually closed in the proverbial marketplace of ideas in which we are all participating.

muhfuhkuh 14y ago

So, when does one prove causation? Because by any economic metric, the times when we've been fiscally strong is when the top marginal tax rate was higher than 36% currently. When they lowered it in 2001 from 40% while going to war, it created net zero jobs during the entirety of the Bush administration (and starting leaking jobs en masse during the crisis in 2008). One could argue that Reagan's administration saw some powerful growth, adding 15 million net jobs; but, again, he maintained a >50% top marginal tax rate average through his tenure. The Clinton administration growth rate was even more powerful (arguably) than Reagan's, seeing 23 million net jobs during his tenure, and that was when top marginal rates were nearly 40%. An outlier, and a very powerful one, is when we saw the largest uplift from post-war growth phase to absolute juggernaut boomtime, was during the 50s, when top marginal tax rates were 90%. Somehow, I doubt we'll ever go back to that time (both in growth and taxation), but we can see that the times of growth was when top marginal tax rates were over 40%. Dip below, no room to grow. IMHO (with evidence), of course.

georgieporgie 14y ago
I've heard a number of people (Grover Norquist included) make the claim that although the top marginal tax rates were higher, there were a far greater number of tax exemptions available. I have no idea how true this is, and I'm not aware of anyone who's studied the actual income, wealth, and taxes of America's rich over the decades.
- viggity 14y ago
  Agreed, looking at top marginal rate seems weird, why not look at effective tax rates for the Top 1, 5 and 10% instead?
  - nikcub 14y ago
    because it doesn't give you the answer you want
    - muhfuhkuh 14y ago

cullen 14y ago

The case for a progressive tax scheme is that it, may reduce one incentive for the most financially successful monkeys to plunder the less financially successful monkeys, including those monkeys who may be just as smart; but, maybe got started later. To those of you who are pretending that you've done it all on your own without nobody's help and get your hands off of mine it's all mine mine mine! You're deluding yourself. I can understand why TED don't want to touch his talk. It would be interesting to note how consistent TED are in this respect.

johndbritton 14y ago

Is it possible that by not publishing the talk they'll draw more attention to it? He should re-record and publish the talk on his own and use the "Streisand Effect" in his favor. http://en.wikipedia.org/wiki/Streisand_effect http://en.wikipedia.org/wiki/Streisand_effect

nooneelse 14y ago
He should also use that re-record as a chance to put in more data to support his point. And flesh out his thinking. For instance, that bit about: > "If the typical American family still got today the same share of income they earned in 1980, they would earn about 25% more and have an astounding $13,000 more a year. Where would the economy be if that were the case?" I would love to see some stabs (pessimistic, median, and optimistic) at following out the economic effects of that question. What is a reasonable ratio of the $13k which would be put toward more spending, and how would that effect the demand seen by businesses, and thus the number of jobs supported?
- mchusma 14y ago
  I would also say any attempt to discuss causation would be great. It's very light on that, and doesn't address any of the huge macro issues to contend with.

freshhawk 14y ago

So if either political party chooses to start throwing bullshit back and forth on some ideological hot button issue then TED decides that this subject is now off limits? Don't we want the people at TED to be able to share good arguments concerning precisely the things that are most important and most misunderstood (which hot button political issues are, since people now choose an opinion based on tribalism rather than reason) So that reasoning is bullshit. I don't want democrats or republicans choosing which topics are now off limits for debate because they are now political. For fucks sake, political topics are the ones that need debate. What else does "political topic" mean other than "this is important to our society and there is disagreement". So TED talks are "Riveting talks by remarkable people on subjects that have not been deemed off limits by one of the two big political parties in the US". Nevermind the fact that this clearly has nothing to do with political controversy as described, everyone knows there are talks about evolution, climate change and cosmology. The only difference is that there are likely people at TED who might disagree with this one.

mtjl79 14y ago

I'm sorry but, higher taxes aren't going to solve anything. At the end of the day, our spending will just not stop. We are just adding fuel to the fire. We need to: • Invest in the future: We need to invent, produce, and export new renewable energy sources. We need to invest in robotic manufacturing because cheap people labor is not sustainable in any country - robotic is where it will go. • We need to heavily tax imports like many other countries in the world do. And have American made things become competitive - we have sold our souls to Asia. • Drastically cut bullshit spending. There are billions spent every year on...bullshit. • Invest further in Entrepreneurship, and start bringing smart people from other countries here. Those are big 4. The big problem is our countries expenses vs. income is too high. At the end of the day, a country is a business. And right now, we are a company that is not running well. We need to clean out the board of directors (Congress) and start fresh.

eli_gottlieb 14y ago
At the end of the day, a country is a business. No, it's not. It needs to manage its finances responsibly, but that is quite different from being a profit-generating business.
- mtjl79 14y ago
  Countries are the largest companies that exist on the planet.
  - eli_gottlieb 14y ago
    Quite simply, no. The goal of a country is not to amass wealth in the government.
    - mtjl79 14y ago
      Not all companies that operate are for profit. BUT, The goal of a country is to amass wealth, is it not?

mchusma 14y ago

Does anyone have global wealth/tax numbers? I'd argue that the US is not a closed system. So the % the world governments take vs GDP. This might be helpful to see if what he is suggesting is plausible.

rdl 14y ago

I don't have a big problem with income inequality, compared to wealth inequality (averaged over a long time). Consumption taxes and "death tax" (or at least a strong social convention toward donating assets in excess of a certain level, rather than heirs inheriting them) would go a long way. Income inequality is largely due to differences in economic contribution, and encouraging people at the far right of the power curve to do more (and be more numerous) produces positive externalities. The main quick fixes to the tax code which I'd like to see are immediately taxing carry as income, getting rid of deductions for employer health insurance and mortgage interest, and a national sales tax or VAT (ie consumption tax), ideally highly progressive or exempting the first 50k/yr or something. Then, look at lowering income tax rates to something like 25% flat and setting lt capital gains and dividends at slightly less (20%) or the same as income but indexed for inflation. Get rid of the AMT, and maybe lower corporate rates to try to get firms to repatriate more and avoid abusive tax structuring like the double Irish sandwich and such. A more transparent tax code, even if revenue neutral, would boost economic activity. A more transparent tax code, taxing things with negative externalities and not discouraging positive externalities, raising more income while cutting expenditures greatly, would be even better. Not that there is much chance of any of this happening.

mikecane 14y ago

Discussions like this sometimes stagger me personally. Did Dickens write for nothing? Does everyone really wish to be Scrooge or Bounderby? Did Jack London write The People of the Abyss and waste his time? How many times must we relive that age before the lessons we learned from it at that time are permanent and inarguable?

crusso 14y ago
Why would you think that fictional stories that would be anecdotal if real should inform anyone of anything? Real economic issues require solid statistical analysis based upon proven economic models. Anything less is just a projection of emotional bias that means little to society and would never solve anything.
- mikecane 14y ago
  OMG. Have you also algorithmically quantified love too? And tell me what a "proven economic model" is. One where the rich have to hire working class cops in their off-hours -- depriving said cops' families of their presence -- so they can feel safe in common spaces? One in which private security and private prisons are the fastest growing employers? I've got news for you, pal, and you can shove this up your algorithms: People are not machines and, as messy as you might find this fact to be, have emotional components. Someone in the lower rungs of society might not be able to explain with a PowerPoint presentation the precise manner in which he or she is being screwed, but emotionally they can show you.
  - crusso 14y ago
    > OMG. I'll leave that there to speak for itself. > Have you also algorithmically quantified love too? I can certainly see where an emotional person who doesn't know much about economics would try to turn this into an emotional issue. It's not. It's an economic issue. The whole reason why we step from one financial mess to the next is that we don't make political decisions based upon economic forces such as supply & demand. Political decisions are typically made to benefit the power of politicians. They do so by making emotional arguments to people who don't really understand much about economics but who know how to pull a voting lever. Congratulations, that means you. > People are not machines and, as messy as you might find this fact to be, have emotional components. And this has precisely what to do with the economic health of the country?

msabalau 14y ago

What is odd to me is the parocial yardstick that the TED curator is reportedly using to judge what's controversial. "We already have Melinda Gates on contraception" With whom other than the socially conservative wing of the US Republican party is birth control "controversial"? A few thousand people in Vatican City, some other religious leaders of their ilk, and a scattering of anti-colonialist thinkers. I would have thought TED would have taken a more cosmopolitan view of what counts as controversy.

andr3w321 14y ago

Here's the text and slides to the talk. I'm sure the video will come out eventually. http://www.democraticunderground.com/101628527 http://www.democraticunderground.com/101628527 I think it's pretty ridiculous TED would not post this video. They really shouldn't be censoring things like this unless someone is just completely making things up in their talk in which case they did a poor job of picking their speaker.

fiaz 14y ago

Shame on the news media for not asking meaningful questions to people who make claims on either side of the US political spectrum. I feel as though a culture of timidity to ask questions that lead to clarifying answers is turning into a culture that politicizes the truth.

ktizo 14y ago

Here's the text of the actual speech, linked to from the article. http://roundtable.nationaljournal.com/2012/05/the-inequality-speech-that-ted-wont-show-you.php http://roundtable.nationaljournal.com/2012/05/the-inequality... To be honest, it seems to be basic common sense, if this is too controversial for TED then they are seriously losing their way. As for saying they had Melinda Gates talking about contraception around the same time and thinking that it was a reasonable excuse for backtracking. Well to me, that just doesn't even start to make the slightest bit of sense as an argument.

dgreensp 14y ago

As others have said, there is not a lot of substantiation in the talk to shed new light on frequently-discussed topics. It feels intellectually shaky to assert that the economy will go back to growing, if only the middle class can go back to spending, which we can achieve by giving more money to the government. Here's a different and more TED-like viewpoint: Perhaps economic growth actually requires movers and shakers. The US has had a good share of them. These people aren't going to be your archetypal rich fat cats, nor your average Joe living paycheck to paycheck. If they are rewarded with wealth, that is a good thing. And sure, some of that wealth can go into a pot to use for the common welfare. If we want more consumer spending, let's give people better things to spend money on, things that help them in their own quest of fulfillment and creating value. If businesses are reluctant to hire, it's only because they need to make correspondingly more money to make the hire worthwhile. As we know from start-up land, many tasks can't be done better by throwing more people at them, especially creative tasks. We're still trying to solve the problem of how individuals can cooperate and merge their individual strengths towards big goals. A full-time human ought to be a very valuable asset to a company, though, and many companies can be viewed as engines that take human effort and turn it into value, creating money. Economic growth is not to be taken for granted. It requires innovation, optimism, and positive energy that comes from individuals. There are many things rich and non-rich people can do with their time and money to help, besides just giving their money to the government. Take something you're good at and provide a service, or make something and sell it. Lend a cup of sugar to your neighbor. Earn what you're worth. Invest in good businesses. Pay someone to do something for you. And on and on.

confluence 14y ago

Relevant answer I found on Quora: http://www.quora.com/Who-creates-wealth-Entrepreneurs-investors-workers-or-all-three/answers/933836 http://www.quora.com/Who-creates-wealth-Entrepreneurs-invest... The world is more complex than a lot of the arguments that people have on this issue. One side appears quite facile and naive in their hero worship of entrepreneurs/investors at seeing/creating the future (when the chances are they merely bump into it along with many others). These are almost universally young people who are nurtured/protected by their families/society or already successful people who think they are the sole cause of their success (it's usually a combination of internal AND external factors). The other side is too oppressive and cynical, stating that entrepreneurs don't create jobs, but extract wealth. These are usually unprotected people, the poor, and the unsuccessful who just don't understand why they are trodden upon and treated like vermin to be ignored. The world isn't black or white. It looks like it is extraordinary complex with many shades of gray. Hence the best way to look at this issue is thus: If you were the down trodden upon, the poor, the unlucky, the unhealthy - How would you like the tax system to treat you? Would you like them to say: No, your situation is ALL your fault - the rich matter, we shouldn't tax them and let them create jobs for little all you. OR Yes, the rich are extraordinarily lucky to have what they have, and it would be best to share that around. Because as you all know: You had a 50% chance of being born in the rest of the world, in the darkest poverty, where nothing you did, said, or who you are meant anything because of your situation. Born in America: Billionaire. Born in Afghanistan: Your dead. What you can achieve has doesn't correlate strongly with what actually happens to you - you are made by your situation. We float with the times and environment around us - not the other way around.

nooneelse 14y ago
Interestingly enough, the framing of the Quora question leaves out "the buyers" as part of the critical circle for wealth creation. That is the role that, I thought, Hanauer's talk was pointing out is played by the middle class. Perhaps the Quora question meant to capture them as "the workers", but that, according to my interpretation of the talk, mislabels their most critical role.

neuro 14y ago

Americans tax payers are a trampoline for globalizing these corporations through subsidizing their R&D, bailing them out and soldiering their resources abroad. These corporations have global consumers now, the health of the American consumer isn’t a priority.