Income Inequality.

[lewisnotmiller]

It's not working. Our empathy is not overcoming our fear and greed. In fact, it can be argued that as humans are able to generate more and more "stuff" we become more and more selfish, rather than empathetic. People who know what it's like to go without tend to empathize more when they see someone else going without. While people who never really had to go without just blame the victims when they see them going without.

Empathy isn't the solution, though, wisdom is.

I think at least some of this has to do with the variance over time of smaller, familial groups being replaced by ever increasing group sizes, and the matching loss of cohesion and shared responsibility this engenders.

 

[Alien826]

A brief summary.

The wealth of (say) a company is generated by everyone involved, to a greater or lesser extent. A CEO, no matter how good he is at running a company, can create nothing without the "workers" that actually build the products. The workers, left alone, would produce some stuff but it would be disorganized and of lower value without leadership, designers, salesmen and so on. Everyone contributes.

Now it gets more difficult. I hope nobody will disagree that ideally everyone should receive an equitable share. How that is based is where it gets difficult, and getting those that are the winners under the current system to agree to any change is even more difficult.

"If I ruled the World" I would institute an income, sufficient to live at a "basic" level, that everyone would receive regardless of other factors. Then we could discuss how the rest of the wealth is distributed, based on some measure of contribution to its production. (I'm talking about society in general now, not just one company). That would eliminate poverty without the problems of systems like communism.

 

[Heyo]

A brief summary.

The wealth of (say) a company is generated by everyone involved, to a greater or lesser extent. A CEO, no matter how good he is at running a company, can create nothing without the "workers" that actually build the products. The workers, left alone, would produce some stuff but it would be disorganized and of lower value without leadership, designers, salesmen and so on. Everyone contributes.

You forgot the shareholders.
They contributed in the beginning by providing the initial resources and now they only skim the profit - forever, without any further contribution.

Now it gets more difficult. I hope nobody will disagree that ideally everyone should receive an equitable share. How that is based is where it gets difficult, and getting those that are the winners under the current system to agree to any change is even more difficult.

"If I ruled the World" I would institute an income, sufficient to live at a "basic" level, that everyone would receive regardless of other factors. Then we could discuss how the rest of the wealth is distributed, based on some measure of contribution to its production. (I'm talking about society in general now, not just one company). That would eliminate poverty without the problems of systems like communism.

UBI is a pretty popular concept. Even unteachable capitalists like @Revoltingest favor it. Some countries are seriously thinking about implementing it, some have have run initial tests. We may see it in our lifetime.
And it will become necessary when the third industrial revolution hits us. This time there seem few jobs in sight those who lose their jobs to AI can take.

 

[Audie]

The discernment i soften not made amd cheaper quality gets presented as a viable ootion for making things cheaper.

So just news of the known. But
omitting mention of the role of competition
in avoiding that

 

[Revoltingest]

UBI is a pretty popular concept. Even unteachable capitalists like @Revoltingest favor it.

I ran across the idea from The Cato Institute
decades ago...before I gave up learning new
things. It's the most libertarian way to create
a useful social safety net.

 

[Shadow Wolf]

And it will become necessary when the third industrial revolution hits us. This time there seem few jobs in sight those who lose their jobs to AI can take.

That's going to require fundamental paradigm shift to adequately address. Unfortunately it'll probably come to war to abandon the old system and replace it with what we really should be starting to build today.

 

[Kfox]

Wow! I must be responding to at least a dozen people. I appreciate your responses and I will try my best to get to your all, but it might take a little while just be patient with me; thanks for the replies

 

[Kfox]

Yeah, that doesn't say anything about the income gap narrowing when the economy suffers.

It's more of a common sense thing. If I recall, during the dot com bust, the richest man in the world (Bill Gates) saw his fortune shrink from $50 to $25 billion, the poorest man in the country saw his wealth go from 0 to 0. $25 Billion is a heck of a lot closer to 0 than $50 billion.

 

[Kfox]

If the situation for the poor have improved from what it was before, then of course having the billionaires is a good thing.

So you can see a scenario where income inequality results in good?

 

[Kfox]

Yes. There’s nothing strange about what you say here, because what you are saying is that when the economy is bad, it affects everyone - including the poor.

However, in no way does that mean that inequality is good.

Humbly,
Hermit

My point is, in today's economy when income inequality is at it's greatest, things have been better for the poor.

 

[Kfox]

I would like an actual account of that with numbers and procentages and not just your word for it.

Sorry but I just don't have time to go digging up the numbers and percentages; I've got too many people to respond to. What did I say that you disagree with?

 

[ADigitalArtist]

It's more of a common sense thing. If I recall, during the dot com bust, the richest man in the world (Bill Gates) saw his fortune shrink from $50 to $25 billion, the poorest man in the country saw his wealth go from 0 to 0. $25 Billion is a heck of a lot closer to 0 than $50 billion.

Bill Gates was in an industry directly involved in the dot com bubble bursting but wealthy often get more wealthy during economic downturns, not less, with many seeing record profits during the housing crisis and covid.

Also you act as if the only change that happens to poor people is going from zero to zero. It most certainly isn't. As the few remedies in social programs the poor have access to get choked as the vanishing middle class becomes poor. What really happens is some rich lose some money and a lot of poor people die.

 

[Kfox]

You asked:

My post was a direct answer to your question. What didn't you understand? My answer or your question?

If you go back and look at the claim I was responding to, you will see I asked a question, then answered my own question in a way that refuted his claim

What are the conditions that would make it fair that a sales person gets more money (in some cases thousands of times more) than the inventor and the producing workers?

In the examples I gave, the sales person purchased the rights to the product/patten from the inventor for an agreed upon price, then introduced the product to the public in a way the inventor was unable to do, allowing him to create wealth in a way the inventor was unable or unwilling to do.

It seems you not only have no clue about economics but you also lack basic economic thinking skills. (Or you are just flailing because you are not for equality of opportunity and won't admit it.)
Who says that the government has to liquidate the stock asap? Stocks generate money. The government could keep the stock for a time and cash in the dividends. (As Lower Saxony does with VW and France does with their automotive industries.) That way they could also influence the salaries of upper management and the policies of the company.
Now, you'll say "that's socialism!" and you would be right. Socialism is a direct consequence of equality of opportunity.

If the Government takes over your business the minute you retire, you have less incentive to do what it takes to start a business; resulting in far less wealth being created.

Do you think mansions and yachts get paid with wealth? No, the supper rich have hordes of money, not all their wealth can be directly converted in to money, that's true, but the money (dividends) that the wealth creates gives them a nice allowance.

No. You said 700 people in the US have enough MONEY to give everybody in the country $13,000 a piece. The allowance created by their dividends are not enough to give everybody $13,000 each.

 

[Kfox]

What happens to nearby villages when dragons hoard all the treasure, resources and currency?

Never happened. Dragons are not real.

\This is a moving of the goalposts. You've gone from saying we credit inventors according to their inventions' value,

We do.

which we absolutely do not, to trying to frame salesman as being more essential (by pay) than inventors.

The examples I provided, the salesmen purchased the rights to the product from the inventors and made more money.
Nowhere did I say ONLY the inventor makes money off the product he produces; we can come up with scenarios where lots of people make money off of somebody else’s inventions.

 

[Kfox]

But it is. So I do.

I suspect in cases where it wasn't, you would still say it is.

 

[Kfox]

What skills did those jobs actually teach you?

The main skill I learned that got me outta the fast-food industry and lead to a much higher paying union job was learning inventory and basic warehouse skills.

 

[Kfox]

Depends

Can you provide a real life example where if the rich had less wealth, the poor would have more?

How did you reach the conclusion that only the rich create the wealth?

I didn’t say ONLY the rich create wealth; I said the wealth they create, they usually keep the lions share of it.

 

[Kfox]

Is that why many of my coworkers took huge paycuts? Must be those choses amd stuff you talked about. After all, I chose to be borm at such a time that I was in a spot to have nothing to lose but much to gain as conpanies reshuffled their decks and I walked out of the Recession wealtheir than when it started amd with home ownership.
I guess all those rich people and everybody else just made bad choices.

In a Recession, more people lose money than make money, and during an economic boom, more people make money than lose money. But in both cases you will always have outliners who make money when everyone else loses, and lose money when most others make it.

 

[Koldo]

Can you provide a real life example where if the rich had less wealth, the poor would have more?

Any time they increase the wages of the poor working for them.

I didn’t say ONLY the rich create wealth; I said the wealth they create, they usually keep the lions share of it.

The way you phrased it was odd then. But Ok.

 

[Kfox]

Not according to this chart (Gap Between Rich and Poor Growing in U.S.):

View attachment 78841

As indicated here, the gap was lowest during the time of the greatest economic boom and period of growth we've ever seen (post WW2), but we can see the gap widening coinciding with America's long-term economic decline since the Reagan era.

The places where the gap is widest are third-world countries with weak economies and low standards of living, whereas the sign of a robust and strong economy is when the gap between rich and poor is narrow.

I was talking about in today's economy. After WW-2 Europe and Asia was destroyed, but the USA remained untouched; so we were the only country open for business, and it took Europe and Asia 30 years to rebuild and start providing us competition again.