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Economic growth and the resulting distribution of wealth / capital is not a zero sum game. So the fact that the top 1% owns more than the rest, is not a problem

by wjnc 12y ago

Economic growth and the resulting distribution of wealth / capital is not a zero sum game. So the fact that the top 1% owns more than the rest, is not a problem per sé. Who cares what 'they' own, if I / we can live happily, in wealth and in health. An opinion on the distribution of wealth (Piketty) is more political than economical. But even on the more libertarian axis of the spectrum (for the US: conservative, for the rest of the world: liberal), it might be troubling. 'We' are working hard to eradicate poverty in all those countries attached to the 'global economy'. That is such a big plus in the lives of billions. But for the already developed world it might be different. One of (my) principles to hold dear is the chance of improving oneself by studying, working hard, etc. The demise of the middle class in many developed countries, is an example. It seems to be getting harder for the many to work hard, own a house and save enough for retirement. The rents paid to the winners in, say, the financial sector or modern internet are so disproportionate that they feel more like luck than skill. I don't have an answer of policy, because if you target that glut of wealth but end op hurting innovation, you hurt the billions as well. But if (very big if) things like quantitative easing are stimulating the glut of cash flowing towards finance and venture capital, we might not be creating a very stable future where hard work and effort get rewarded with any notion of certainty. And that ís a problem for the world.

mikeash 12y ago
The problem as I see it is not wealth per se, but the fact that wealth confers power. Concentrated wealth means concentrated power, and that means the concentration of both will accelerate. A rising tide lifts all boats, but who says the elite will remain content with a rising tide? Once they accumulate enough wealth and power, they may start to find it advantageous to add to their own wealth by impoverishing the rest. It's often said that economics is not a zero sum game, and that for one person to win, another does not have to lose. That is, of course, completely true! But it doesn't mean that it's impossible for one person to win by causing another to lose. This, of course, is nothing new. One of the best ways to accumulate power and wealth throughout history has been to conquer and enslave. One of the best things about the modern world is that we've managed to structure it such that conquest and enslavement are no longer good ways to obtain power and wealth, and you do much better by figuring out a better way to give people what they want. But there's nothing that says it couldn't go back to the way it was, perhaps with more clever and subtle techniques than simply leading a bunch of rough men on horses into the villages of your enemies.

by wjnc 12y ago

mikeash 12y ago

The problem as I see it is not wealth per se, but the fact that wealth confers power. Concentrated wealth means concentrated power, and that means the concentration of both will accelerate. A rising tide lifts all boats, but who says the elite will remain content with a rising tide? Once they accumulate enough wealth and power, they may start to find it advantageous to add to their own wealth by impoverishing the rest. It's often said that economics is not a zero sum game, and that for one person to win, another does not have to lose. That is, of course, completely true! But it doesn't mean that it's impossible for one person to win by causing another to lose. This, of course, is nothing new. One of the best ways to accumulate power and wealth throughout history has been to conquer and enslave. One of the best things about the modern world is that we've managed to structure it such that conquest and enslavement are no longer good ways to obtain power and wealth, and you do much better by figuring out a better way to give people what they want. But there's nothing that says it couldn't go back to the way it was, perhaps with more clever and subtle techniques than simply leading a bunch of rough men on horses into the villages of your enemies.