5 ms·

This is a side show. Whether or not the statistics show rising or falling income inequality is irrelevant. There is massive income inequality. Its trajectory i

This is a side show. Whether or not the statistics show rising or falling income inequality is irrelevant. There is massive income inequality. Its trajectory isn't nearly as large of an issue as the status quo, which is pretty dismal. Until that gini coefficient is much better, and we have no one living below the poverty line, we still have a ton of work to do. This article seems to be making a shallow point only to encourage inaction on the core problem. The trajectory of income inequality is a red herring trying to distract us from the harsh reality of our present wealth, opportunity, and income inequality. The right thing to do is to keep working to solve the core problem. Restore the US to a progressive tax system instead of regressive. Pass living wage laws. Improve the social safety net. Maybe even consider doing what Switzerland is considering, and give everyone (rich and poor) a reasonable guaranteed income as an alternative to expensive and sometimes ineffective welfare programs. At the small scale, volunteer locally, especially anything having to do children and improving their education. Unfortunately, along the way we will be fed a constant stream of garbage articles like this, held up with straight faces by a chorus of onlookers telling us there is no problem to fix. Look outside. There are poor and hard working people out there who aren't being rewarded for their hard work and are severely struggling. No amount of fancy statistics bending will justify inaction.

ctdonath 13y ago
Institutionalized theft isn't an acceptable solution. Such class jealousy does not, historically, end well.
- splawn 13y ago
  "Institutionalized theft" could be used to describe both sides of the gap issue.
- examancer 13y ago
  Calling progressive tax systems institutionalized theft is incredibly clever, and incredibly false. No one who has wealth created it by themselves. You don't print your own money, you don't extract wealth from a vaccum. Wealth is built by extracting that wealth from a shared economy. Asking those who were able to extract the most wealth to help the most in paying to protect this shared system, and help those who were exploited by it, is not theft. You are being intellectually dishonest. I would not be surprised if deliberately so.
  - guscost 13y ago
    > Wealth is built by extracting that wealth from a shared economy. This is a very old argument, but the economy is not a zero-sum game.
    - holograham 13y ago
      > Wealth is built by extracting that wealth from a shared economy. This is wrong. First wealth is not extracted from people...it is created from a voluntary exchange. Think about why people handed over money to the "wealthy" in the first place. It was in exchange for a good or service that made that person wealthy where wealth is defined by being better off than they were before. Money is just a unit of exchange that we use to move wealth around. Following this logic the wealthy have already paid their dues so to speak by making other people more wealthy. Again they do not EXTRACT wealth, they GENERATE wealth for their customers. People with a ton of money should be applauded for delivering so much wealth to society not vilified as if they stole it from them.
      - guscost 13y ago
        For the most part I agree with this explanation, but it does not apply to certain cases such as inheritance. Unfortunately the tendency to portray all wealthy people as entitled heirs has been around since the days of explicit aristocracy.
        holograham 13y ago
        how does it not apply for inheritances? That money that was inherited came from delivering a good or service in a voluntary exchange. Just because the money was passed down a generation doesnt mean that money was acquired any different way. I think you may be trying to point out that the inheritance isnt deserved because the receiver didnt create the wealth. I see inheritances as how the rich choose to spend their money. Some give it to charity, some give it to their kids (which could be a form of charity), some spend it frivolously. Doenst change the fact that the money was generated by creating wealth in the first place.
- mjn 13y ago
  Class antagonism around here has ended pretty well historically. The 19th-century working class agitated against the aristocracy and landlord classes, and after a rocky start, the workers' parties successfully gained power in the 20th century. From around the 1920s/30s to about the 1970s most of the Nordic countries were led by nearly unchallenged social-democratic governments, which used their power to create the modern prosperous society. They did grow increasingly moderate as time went on, the system stabilized, and people lost appetite for more sweeping changes (the 1920s social democrats were solidly part of the socialist movement and much more radical in their ultimate aims, while nowadays they're more like the left wing of the liberal movement, and no longer have much association with Marxism). The Nordic countries of the 19th century looked much different, and much worse. Huge income inequality, entrenched aristocracy, terrible living conditions for the urban working class, etc.
  - rpenguin13 13y ago
    Scandinavian countries have some of the highest external debt per Capita, good job spending money you don't really own.
    - mjn 13y ago
      Did you check net external debt? One side of the debt equation (which is what the "external debt" figures show) is not a particularly interesting figure. If you owe people $75 billion, and they owe you $100 billion, you are "$75 billion in debt" by the external-debt statistic, but "$25 billion in the black" by the definition of indebtedness most people use. There are specific technical uses for external debt, but it does not equate to "spending money you don't really own". The figure that nets these out is the "net international investment position", which subtracts liabilities from assets. The Scandinavian countries have very good positions here. Denmark's NIIP is +27% of GDP, versus the U.S.'s -17%. The Scandinavian countries have high debt positions basically because they are advanced (i.e. highly financialized) economies with good credit ratings, so make a lot of use of cheap bonds. Same reason Apple issued a bunch of bonds last year despite their huge cash pile. Due to some quirks at the moment Denmark is actually making money on their bonds, as they are issued at negative interest rates— there has been an influx of EUR into DKK due to fears over the EUR, and to discourage that influx (to protect its pegged exchange rate) Denmark is offering negative rates...
- Retric 13y ago
  Such class jealousy does not, historically, end well for the rich. Overall the Magna Carta was a boon for the English economy and the french revolution was surprisingly helpful for there economy in fact most of Europe prospered after similar disruptions. People with wealth and or power want to keep it, but concentrated power does not lead to efficient resource allocation.
- cryoshon 13y ago
  It's not theft so much as performing your fundamental human directive to be your brother's keeper. In modern society, we have many brothers who we've never met, but that doesn't mean that we shouldn't be helping them prosper.
- anigbrowl 13y ago
  Neither is ignoring the fact of negative externalities. One could view income redistribution as a crude method for quantifying the latter.
- sharemywin 13y ago
  The government giveth and the government can taketh away. Property rights, money, laws are all government constructions without them you can only keep what you can forcibly defend. so, "theft" has no meaning without a government to back it up.
- rayiner 13y ago
  It's a mistake to call progressive tax systems "institutionalized theft," one predicated on misunderstanding the nature of the benefit the rich derive from civil society. The very title "Atlas Shrugged" exemplifies the mistake. Your typical "Atlas" in modern society does not look like this: http://static2.wikia.nocookie.net/__cb20131015180238/monster/images/3/32/Atlas.jpg http://static2.wikia.nocookie.net/__cb20131015180238/monster.... He looks like this: http://techrights.org/wp-content/uploads/2011/01/Lloyd-Blankfein.jpg http://techrights.org/wp-content/uploads/2011/01/Lloyd-Blank.... The rich do not pay taxes to keep the masses from using violence upon them. They do it so the masses will suppress the "men of war" that would otherwise dominate them. In reality, John Galt is not in charge once he shrugs off the yoke of society. Instead, men skilled in violence and war take advantage of that power vacuum and subjugate him, and he works to serve them. This state of affairs is not unprecedented. You only have to look back to Europe during feudal times to see it in operation. The technologists of that time didn't run the world. Barons and Earls and other military men ran the world. The technologists served the military class.
- coldtea 13y ago
  >Institutionalized theft isn't an acceptable solution. Such class jealousy does not, historically, end well. Historical precedents are not, historically, very useful. Lots of things that worked at some point in time for some country (e.g a revolution) failed at other points in time for some other country and vice versa. Each era has unique factors -- from technology to culture. You cannot make assumptions based on what happenned in this or that case 50 or 1000 years ago. Plus, the notion of "institutionalized theft" is politically charged itself. Whole lotta assumptions there ("those who have lots of wealth deserve it", "they got it all by themselves", "society is better off if they don't be made to share it", etc). How about inequality being "institutionalized theft" and redistribution being "justice"?
  - rpenguin13 13y ago
    Institutionalized by whom? In a society of voluntary contracts, those who have lots of wealth DO deserve it, and if they're clear under law then they DID get it all themselves, and "Society" is a mythical being: it has no right to forcibly steal from some more wealthy individuals. "Oh, so you built this house from LEGO blocks during break hour while the other kids where playing around?" "Yes" "It'd be better off for all of you if we could take that house and give it to stupid kids who can't build it."
    - coldtea 13y ago
      >Institutionalized by whom? By those in power, now and in the past. >In a society of voluntary contracts, those who have lots of wealth DO deserve it For one, the form and reach of those "voluntary contracts" were made with no direct involvement from the population. Were you consulted when you grew up on how they'd be, apart from voting every 4 years or so? Do the grandchildren of an industrial robber barron, "DO deserve" the money they inherited? How about all the families that got rich by exploiting slaves? Do their descendants deserve their higher status in society they enjoy? How about people with large real estate? How exactly Native American territories become the property of some real estate tycoons back in the day (and are passed forward now)? Just because the law accepts a transition from then to now, doesn't mean the "deserve" question is settled. >"Society" is a mythical being: it has no right to forcibly steal from some more wealthy individuals. Well, society is the people. Nothing mythical about it. It's the origins of property that are mythical, as land and resources start off as free for all. Rather, it's a social contract that allows the wealthy individuals to be wealthy. There's no "right" in that (except if you believe in God given rights), just what is deemed acceptable. That's something that can be reversed at any time, as the kings in France found out.
- baldfat 13y ago
  It is Institutionalized Theft! The Rich believe it is them who is being stolen from. When it is them who are stealing. If we did a flat 15% tax who would be paying more in taxes?????
mchusma 13y ago
I'm not sure you read the article, because you make some of the same points I do. "There is massive income inequality. Its trajectory isn't nearly as large of an issue as the status quo, which is pretty dismal." The point of the article is that inequality is itself isn't a good metric. "The right thing to do is to keep working to solve the core problem....Maybe even consider doing what Switzerland is considering, and give everyone (rich and poor) a reasonable guaranteed income as an alternative to expensive and sometimes ineffective welfare program" -I suggest this briefly as my preferred solution.
- examancer 13y ago
  I read the article and recognize your closing arguments are much more nuanced than the thesis of the article suggests. I apologize for not making that clear in my post. I still feel the overall point attacking the statistics of income inequality is much more likely to be used as a gavel to silence those working to improve the status quo. Articles like this are often cited when people try to take action to correct income inequality, regardless of what the article ultimately advocates. That said, I do think its important to get the statistics correct. I don't think you said anything wrong (except maybe with your definition of gini, as others have noted). Your headline is a bit salacious, but ultimately my concern is how this article might be used by others.
  - mchusma 13y ago
    Thanks again. I did fix the Gini issue, which was my fault in trying to get something posted without sufficient editing. I was surprised by how confusing the statistics were about the trend of income disparity. How the numbers varied widely by source, and how much definitions mattered. I think we both agree that the trend of this is not important. I'm not sure if we agree or disagree on whether relative status is important or not. I would argue it is not important, except to the extent someone else pointed out that it provides political influence (which I do think I have a solution for). I prefer to look at absolute measures of improving the standard of living (life expectancy, health, food, entertainment, etc).

ctdonath 13y ago

Institutionalized theft isn't an acceptable solution. Such class jealousy does not, historically, end well.

splawn 13y ago
"Institutionalized theft" could be used to describe both sides of the gap issue.
examancer 13y ago
Calling progressive tax systems institutionalized theft is incredibly clever, and incredibly false. No one who has wealth created it by themselves. You don't print your own money, you don't extract wealth from a vaccum. Wealth is built by extracting that wealth from a shared economy. Asking those who were able to extract the most wealth to help the most in paying to protect this shared system, and help those who were exploited by it, is not theft. You are being intellectually dishonest. I would not be surprised if deliberately so.
- guscost 13y ago
  > Wealth is built by extracting that wealth from a shared economy. This is a very old argument, but the economy is not a zero-sum game.
  - holograham 13y ago
    > Wealth is built by extracting that wealth from a shared economy. This is wrong. First wealth is not extracted from people...it is created from a voluntary exchange. Think about why people handed over money to the "wealthy" in the first place. It was in exchange for a good or service that made that person wealthy where wealth is defined by being better off than they were before. Money is just a unit of exchange that we use to move wealth around. Following this logic the wealthy have already paid their dues so to speak by making other people more wealthy. Again they do not EXTRACT wealth, they GENERATE wealth for their customers. People with a ton of money should be applauded for delivering so much wealth to society not vilified as if they stole it from them.
    - guscost 13y ago
      For the most part I agree with this explanation, but it does not apply to certain cases such as inheritance. Unfortunately the tendency to portray all wealthy people as entitled heirs has been around since the days of explicit aristocracy.
      - holograham 13y ago
        how does it not apply for inheritances? That money that was inherited came from delivering a good or service in a voluntary exchange. Just because the money was passed down a generation doesnt mean that money was acquired any different way. I think you may be trying to point out that the inheritance isnt deserved because the receiver didnt create the wealth. I see inheritances as how the rich choose to spend their money. Some give it to charity, some give it to their kids (which could be a form of charity), some spend it frivolously. Doenst change the fact that the money was generated by creating wealth in the first place.
mjn 13y ago
Class antagonism around here has ended pretty well historically. The 19th-century working class agitated against the aristocracy and landlord classes, and after a rocky start, the workers' parties successfully gained power in the 20th century. From around the 1920s/30s to about the 1970s most of the Nordic countries were led by nearly unchallenged social-democratic governments, which used their power to create the modern prosperous society. They did grow increasingly moderate as time went on, the system stabilized, and people lost appetite for more sweeping changes (the 1920s social democrats were solidly part of the socialist movement and much more radical in their ultimate aims, while nowadays they're more like the left wing of the liberal movement, and no longer have much association with Marxism). The Nordic countries of the 19th century looked much different, and much worse. Huge income inequality, entrenched aristocracy, terrible living conditions for the urban working class, etc.
- rpenguin13 13y ago
  Scandinavian countries have some of the highest external debt per Capita, good job spending money you don't really own.
  - mjn 13y ago
    Did you check net external debt? One side of the debt equation (which is what the "external debt" figures show) is not a particularly interesting figure. If you owe people $75 billion, and they owe you $100 billion, you are "$75 billion in debt" by the external-debt statistic, but "$25 billion in the black" by the definition of indebtedness most people use. There are specific technical uses for external debt, but it does not equate to "spending money you don't really own". The figure that nets these out is the "net international investment position", which subtracts liabilities from assets. The Scandinavian countries have very good positions here. Denmark's NIIP is +27% of GDP, versus the U.S.'s -17%. The Scandinavian countries have high debt positions basically because they are advanced (i.e. highly financialized) economies with good credit ratings, so make a lot of use of cheap bonds. Same reason Apple issued a bunch of bonds last year despite their huge cash pile. Due to some quirks at the moment Denmark is actually making money on their bonds, as they are issued at negative interest rates— there has been an influx of EUR into DKK due to fears over the EUR, and to discourage that influx (to protect its pegged exchange rate) Denmark is offering negative rates...
Retric 13y ago
Such class jealousy does not, historically, end well for the rich. Overall the Magna Carta was a boon for the English economy and the french revolution was surprisingly helpful for there economy in fact most of Europe prospered after similar disruptions. People with wealth and or power want to keep it, but concentrated power does not lead to efficient resource allocation.
cryoshon 13y ago
It's not theft so much as performing your fundamental human directive to be your brother's keeper. In modern society, we have many brothers who we've never met, but that doesn't mean that we shouldn't be helping them prosper.
anigbrowl 13y ago
Neither is ignoring the fact of negative externalities. One could view income redistribution as a crude method for quantifying the latter.
sharemywin 13y ago
The government giveth and the government can taketh away. Property rights, money, laws are all government constructions without them you can only keep what you can forcibly defend. so, "theft" has no meaning without a government to back it up.
rayiner 13y ago
It's a mistake to call progressive tax systems "institutionalized theft," one predicated on misunderstanding the nature of the benefit the rich derive from civil society. The very title "Atlas Shrugged" exemplifies the mistake. Your typical "Atlas" in modern society does not look like this: http://static2.wikia.nocookie.net/__cb20131015180238/monster/images/3/32/Atlas.jpg http://static2.wikia.nocookie.net/__cb20131015180238/monster.... He looks like this: http://techrights.org/wp-content/uploads/2011/01/Lloyd-Blankfein.jpg http://techrights.org/wp-content/uploads/2011/01/Lloyd-Blank.... The rich do not pay taxes to keep the masses from using violence upon them. They do it so the masses will suppress the "men of war" that would otherwise dominate them. In reality, John Galt is not in charge once he shrugs off the yoke of society. Instead, men skilled in violence and war take advantage of that power vacuum and subjugate him, and he works to serve them. This state of affairs is not unprecedented. You only have to look back to Europe during feudal times to see it in operation. The technologists of that time didn't run the world. Barons and Earls and other military men ran the world. The technologists served the military class.
coldtea 13y ago
>Institutionalized theft isn't an acceptable solution. Such class jealousy does not, historically, end well. Historical precedents are not, historically, very useful. Lots of things that worked at some point in time for some country (e.g a revolution) failed at other points in time for some other country and vice versa. Each era has unique factors -- from technology to culture. You cannot make assumptions based on what happenned in this or that case 50 or 1000 years ago. Plus, the notion of "institutionalized theft" is politically charged itself. Whole lotta assumptions there ("those who have lots of wealth deserve it", "they got it all by themselves", "society is better off if they don't be made to share it", etc). How about inequality being "institutionalized theft" and redistribution being "justice"?
- rpenguin13 13y ago
  Institutionalized by whom? In a society of voluntary contracts, those who have lots of wealth DO deserve it, and if they're clear under law then they DID get it all themselves, and "Society" is a mythical being: it has no right to forcibly steal from some more wealthy individuals. "Oh, so you built this house from LEGO blocks during break hour while the other kids where playing around?" "Yes" "It'd be better off for all of you if we could take that house and give it to stupid kids who can't build it."
  - coldtea 13y ago
    >Institutionalized by whom? By those in power, now and in the past. >In a society of voluntary contracts, those who have lots of wealth DO deserve it For one, the form and reach of those "voluntary contracts" were made with no direct involvement from the population. Were you consulted when you grew up on how they'd be, apart from voting every 4 years or so? Do the grandchildren of an industrial robber barron, "DO deserve" the money they inherited? How about all the families that got rich by exploiting slaves? Do their descendants deserve their higher status in society they enjoy? How about people with large real estate? How exactly Native American territories become the property of some real estate tycoons back in the day (and are passed forward now)? Just because the law accepts a transition from then to now, doesn't mean the "deserve" question is settled. >"Society" is a mythical being: it has no right to forcibly steal from some more wealthy individuals. Well, society is the people. Nothing mythical about it. It's the origins of property that are mythical, as land and resources start off as free for all. Rather, it's a social contract that allows the wealthy individuals to be wealthy. There's no "right" in that (except if you believe in God given rights), just what is deemed acceptable. That's something that can be reversed at any time, as the kings in France found out.
baldfat 13y ago
It is Institutionalized Theft! The Rich believe it is them who is being stolen from. When it is them who are stealing. If we did a flat 15% tax who would be paying more in taxes?????

mchusma 13y ago

I'm not sure you read the article, because you make some of the same points I do. "There is massive income inequality. Its trajectory isn't nearly as large of an issue as the status quo, which is pretty dismal." The point of the article is that inequality is itself isn't a good metric. "The right thing to do is to keep working to solve the core problem....Maybe even consider doing what Switzerland is considering, and give everyone (rich and poor) a reasonable guaranteed income as an alternative to expensive and sometimes ineffective welfare program" -I suggest this briefly as my preferred solution.

examancer 13y ago
I read the article and recognize your closing arguments are much more nuanced than the thesis of the article suggests. I apologize for not making that clear in my post. I still feel the overall point attacking the statistics of income inequality is much more likely to be used as a gavel to silence those working to improve the status quo. Articles like this are often cited when people try to take action to correct income inequality, regardless of what the article ultimately advocates. That said, I do think its important to get the statistics correct. I don't think you said anything wrong (except maybe with your definition of gini, as others have noted). Your headline is a bit salacious, but ultimately my concern is how this article might be used by others.
- mchusma 13y ago
  Thanks again. I did fix the Gini issue, which was my fault in trying to get something posted without sufficient editing. I was surprised by how confusing the statistics were about the trend of income disparity. How the numbers varied widely by source, and how much definitions mattered. I think we both agree that the trend of this is not important. I'm not sure if we agree or disagree on whether relative status is important or not. I would argue it is not important, except to the extent someone else pointed out that it provides political influence (which I do think I have a solution for). I prefer to look at absolute measures of improving the standard of living (life expectancy, health, food, entertainment, etc).