If I could give away all my hn points and apply them as up-votes to this, I would.
The op explains very succinctly the problem in this quote:
> what is happening is that the ultra-wealthy are using their disposable income to buy political influence, then using that influence to get laws passed that allow them to collect rents.
My primary beef with American politics is the "solutions" are always in the form of bandaids - they focus on the effect, not the root cause. The recent healthcare laws are a prime example. How to handle the rise of ISIS is another. Both were caused, or at least compounded by misinformed short-sighted policy. The answer is rarely "more laws". Especially when more laws was what lead to most of these problems in the first place. It's like writing more code around terrible code when what is really needed is a total refactor and proper test coverage.
Ending cronyism is fairly straight-forward. But stacking on more law is only going to exacerbate the issue, because like the op explained - the well-connected are just going to buy more political influence and have the laws crafted to benefit them. Taxation is more complex. Increasing taxes is often a solution proposed. Fine, but first - the government needs to prove that they are good stewards of our money before reaching into my back pocket for more. Otherwise, that increase is going to end up as farm subsidies and in the pockets of "defense" contractors.
Interesting perspective. I wonder how much "cronyism" costs. It is a problem, but how big?
Sort of the issue is that their is a systemic change taking place globally and it moves at a compounding rate.
Most governments on a micro scale, are inefficient snd comprised of largely unaccountable people. They make (benevolent/naive view) decisions but are ill equipped with the skills to make the proper ones or (cynical) intentionally extract bwnefit. On a macro stage, we are still dumping money into infrastructure in competition with eachother. If we had all the best engineers working on space for example and collaborating, this would be good, or working to solve things collaboratively.
Luckily as PG notes there is a massive defragmentation. I would argue this is great. Agency is redestributed to people in this way and the effects of this will be evident in ~5 years when the laggard affects of technology overtake many legacy industries.
Cable is being challenged.
The monetary system is being challenged.
This election cycle will highlight apathy. It will be realized soon enough that the government will have much less power and is thus, less neccessary.
Etc.
Also, I just saw The Big Short. The L3 money supply (which is super complicated and I don't pretend to fully grasp) is basically mbs in ~2005.
cable tv is being replaced by internet service through the same provider, with the fiber optic deployments being limited by legislation lobbied for by the original cable tv providers.
>The monetary system is being challenged.
Total BTC is about 4 billion usd, much smaller than most nations currency circulation.
i would have to disagree. SpaceX and OneWeb are making strides to do LEO satellite internet[0] and the successful recapture of the F9 rocket means that launch costs are going down. Couple that with the commoditization of cellphone hardware and there will be many distributed systems in space by 2020.
Google has bid on spectrum bandwith, don't have time to cite but Chris Sacca mentions it in basically every interview, just to keep Telecom players in check. They are an ISP now and have other holdings in the space.
Facebook is trying to bring internet to india.
People are building their own networks.
NYC announced it would put wifi in where phonebooths once stood.
> BTC marketcap is 4B
It has a cap of ~6.5[1] according to coinmarket. Obviously not a lot however the upside potential is large and there are many uses for the technology. Ethereum and Stellar are pretty awesome and Patrick Collison helming stripe might be keen to expand their BTC. So if stripe increases the infrastructure and people become more receptive it will become larger. I am not saying that it will replace u.s currency next year but obviously paper money isn't the currency of the future and clearly there needs to be oversite on how money is created. So something like BTC will obv win long term.
Yeah! I'm pretty positive. We're at a pinnacle point where for a lot of big problems, technology / private industry is going to be more effective than the solutions any nation state will be able to provide. Interesting times ahead; governments will need to adapt and focus on what they're good at rather than react defensively.
> Luckily as PG notes there is a massive defragmentation
His essay is about a _re_-fragmentation, which is the opposite of a defragmentation. If this was just a typo, ignore me, but I wasn't sure if you had misunderstood the metaphor he was using.
I meant fragmentation is good, I misspoke. I agreed with a lot of PGs evidence but drew the opposite conclusion. Fragmentation in that people are less tied to companies, countries, organizations, and religion.
I hope this means that as these descriptors fade, people will relate on individual levels and cooperate. Essentially, this is how society improves and the "income inequality" will be offset by the better measuring stick quality of life. i think that fragmentation in pgs sense, from companies and old patterns, is good.
Smart people are getting wealthy and, while am edge case, Elon Musk has had an impact on earth that it could accelerate the pace of technology by decades. So it doesn't matter if income goes down, people can fix the world for a lot less than they used to be able to and things tend to approach their marginal cost.
Tl, dr
am bullish on the individual, technology and less structured institutions.
I feel pretty much the same way, and I read pg as saying basically the same thing (though with a note of caution that I share about the need to perhaps manage the transition).
"Ending cronyism is fairly straight-forward" - I don't think so. Surely you can end one kind of cronyism by replacing it by another one - but it is practically impossible to have a system where those who are better off cannot use their resources for political ends. The bandaids is all there can be done.
And by the way it is also possible that democracy was only possible because of mass conscription - the state needed the masses so the masses got some share in power.
> The reality is that for the past 40 years, Wall Street and the billionaire class has rigged the rules to redistribute wealth and income to the wealthiest and most powerful people of this country.
I am rather puzzled that this idea gets so much traction. Does anyone really believe that if only the rules weren't "rigged" local shops and businesses would be able to compete against Wal-Mart and Amazon? Do people really believe that it's only because of "rigged" rules that big employers are downsizing and shipping production overseas?
It's wishful thinking. The rules don't drive rewards to the top. It's intrinsic to the free market.
It took me years to realize that economics isn't physics - and it isn't ruled by physics-like laws. Instead, economics is governed by laws created by our society. And what we think of as "free market" is really just norms of trade which are created by our society. There is no reason why the bulk of the billions taken-in by WalMart should go to the Walton family while their employees live on food-stamps - that is just a legal arrangement. And there is no reason why the Walton family should continue to be allowed to use offshore corporations to loan themselves money to run all their WalMart stores - that is just a legal arrangement which allows them to avoid taxes and hide their billions offshore. Really, when you start to closely examine "free market", you come to realize that is it a chimera made real by those with power and money.
Zizek phrased it kind of nicely once, in a way that stuck with me. He probably borrowed from somewhere, and I'll continue to lossily reproduce whatever the sentiment was, but it goes something like this.
How is it possible that we are completely and utterly optimistic about breaking all sorts of physical barriers, like landing on Mars, and reusing rockets, and communicating worldwide via little handheld microcomputers, and reattaching body-parts, and aiming to live forever, and do all sorts of crazy biological engineering.
And yet trying to imagine a world were you don't have billionaires having lavish parties while people starve or drone in soul-sucking jobs, or where sweatshops are deemed "bad but better than the alternative", or indeed any sort of radically different social arrangement is seen as hopelessly naive or regressive.
He had better examples, something about a dude with a bifurcated tongue. But the idea stuck with me- what's up with the bounds of our imagination? How come they're limitless when it comes to facing off against gravity, and completely defeatist when it comes to erasing class distinctions?
>what's up with the bounds of our imagination? How come they're limitless when it comes to facing off against gravity, and completely defeatist when it comes to erasing class distinctions?
In my experience, that's only true in America.
People in Canada, Australia, England and Argentina and perfectly happy to discuss and debate ideas and ways to remove (or drastically reduce) class distinctions. Politicians even enact policy to do it.
I think the propaganda of "The Communists" has been drilled into the American public so solidly, it's not only un-American to suggest a change to the status quo, it's also considered utterly impossible.
The US redistributes enough money to the poor to make them richer than the UK, and likely many other wealthy nations in the world. It's not like the US is some Mad Max universe where the poor are forgotten and left without aid.
I'm guessing parent means that the poor in the US are richer than the poor in the UK. (Not sure whether that would be in an absolute sense or relative to cost of living, nor have I verified it in either case.)
Communism happened. It killed lots of people, and made radical changes in the social order unappealing to most. Now ideas don't just have to sound plausible, but you also have to prove that they won't lead to the deaths of millions.
You don't have to prove that ideas won't lead to the deaths of millions at all. Right now there are a bounty of ideas floating around, many the basis of whole civilizations and governments which very possibly could lead to the death of millions if left to finish course. And nary a peep.
What do you believe communism is and how do you believe it goes counter to human nature? It's an impossible thing to discuss without nailing down exactly what it is you are talking about as most people haver wildly diverging ideas of what it implies.
But most people seem to tend to think that communism requires some kind of pure altruism to work (and to be fair, there have been socialist and communists that also believed that), but a central aspect of Marxism is the opposite:
The working class must learn to value its own work and not buy into the subjective moralism of the capitalist classes (that tend to ascribe virtue to wealth: if you're rich, it is generally assumed to be an indicator you have worked hard, while poverty equally is suspect), but be willing to grab the proceeds of their labour. Marx spent a considerable amount of time ripping to shreds early "utopian socialism" (Fourier, Owens et. al) for failing to understand this amongst other failings.
The very insistence of revolution as the mechanism for social upheaval in Marxism is explicitly that Marx did not believe that the ruling classes would be willing to give up privileges willingly even in the face of election defeats, and so once a sufficient working class majority comes into being, sooner or later there would be conflict.
An egalitarian system according to Marx is a desirable, advanced stage of society, but it will come into being, he argues, not because it is the right thing, but because it is the only possible next step: the working classes can only overcome the power of the capitalist classes through sheer numbers, and can unite only because capitalism eventually creates a situation where carving up the pie equally becomes a net improvement for a rapidly growing majority: The rational choice for most of us to maximize our own wealth is an equal distribution the moment the majority of wealth is health by a minority of people, because most of us will otherwise be in the majority that receives less (and for this reason he was insistent that a socialist revolution would fail if attempted somewhere not advanced enough to allow redistribution to eradicate poverty - if it instead merely spread poverty out, class struggles would resume).
Have you heard of social democracy, i.e. taking those ideas and not implementing them by being a murderous crazy dictator? It's working out just fine for the countries which are consistently ranked as the best to live in in the world. As opposed to the US, which is closer to third world status when it comes to things like low median wage, little to no maternity leave, expensive and poor healthcare system, school shootings, poor literacy rates, high drug use rates, etc etc.
I like social democracy. (I was just establishing the burden of proof, not taking a position.)
I'm skeptical that America has enough social cohesion for such a thing to be fully implemented here. Literacy and median wages are fine for the white majority, so we've got most of the trappings of a social democracy for white America. Why would Americans use the state to benefit all people when Americans aren't even willing to put agents of the state on trial when they kill unarmed black people?
First thing that needs to happen to social cohesion in America is stopping focusing everything on race.
Yes, minimum wage affects different races differently. But so does everything else. And one thing I'm pretty sure about : the rich are pushing down minimum wage for reasons that have nothing whatsoever to do with race. Even if the people involved are racists, it still would have little to do with why this is happening. So race is absolutely not relevant to this discussion.
The way this works is that money is being used to make a subgroup of our society desperate enough to do whatever a number of rich folks want them to do, no questions asked. Nobody really cares who's in this subgroup, as long as it's not them and they're sufficiently desperate.
So can we please shut up about whether the amount of melanin in the upper epidermis of some subgroup of the poor is small, medium or large and start talking about the economics at work here ?
The reason I mentioned race is because so many people around here want to ignore it. To ignore it is to ignore the reality that most Americans do not relate with minority groups. Bad news in a minority group is like bad news from the other side of the planet.
If your solution to a problem requires unity, you probably need to find another solution. America is not united.
You seem to accept that the powerful elite will work to push down wages (broadly including providing healthcare and the modern social democratic benefits) but are ignoring the possibility that the quickest and easiest way for them to achieve this is to divide and conquer the poor by race, and its working beautifully for them.
US median wages aren't low compared to Western Europe. Modestly lower than the Nordic countries yes, but modestly higher than France and Germany and so forth.
There's a choose your statistic problem, but it is ~$28,000 or $29,000 (that's based on the estimated median individual wage among employed persons (which I think wage implies employment)).
After government transfers, the bottom income quintile in the US makes more than in the UK and many other wealthy nations. Looking at heart disease and cancer, the US does better, with a less healthy more diverse population than just about every other country (the top ten hospitals with the best cancer survival rates are overwhelmingly in the US), maternity leave may not be mandated, but is available to many if not most. 98% of the US has completed at least 5th grade. And how is the US so different from a social democracy? Massive transfers of wealth to the poor, strong regulations, large government influence in industry, and of course democracy, with strong protections against a "murderous crazy dictator".
The US does well on cancer, but that's because cancer is mostly a disease of old age and the US spends a lot of public money via medicaid on older people.
> The study, the most comprehensive study of literacy ever commissioned by the U.S. government, was released in April 2002 and reapplied in 2003 giving trend data. It involved lengthy interviews of over 90,700 adults statistically balanced[clarification needed] for age, gender, ethnicity, education level, and location (urban, suburban, or rural) in 12 states across the U.S. and was designed to represent the U.S. population as a whole. This government study showed that 21% to 23% of adult Americans were not "able to locate information in text", could not "make low-level inferences using printed materials", and were unable to "integrate easily identifiable pieces of information." Further, this study showed that 41% to 44% of U.S. adults in the lowest level on the literacy scale (literacy rate of 35 or below) were living in poverty.[2]
Here's the explanation for this phenomenon: the former is an example of man versus nature, whereas the latter is man versus man. We're rational animals, so we can try to use our intellect to overcome the insurmountable physical odds of living in an otherwise uncaring universe. However, when we're pitted against each other, we have no such luck.
The standard left wing complaint is that billionaires don't have enough lavish parties, but instead reinvest their wealth in new productive capacity. See, e.g., Picketty, Krugman, or anyone favoring stimulus directed at the bottom of the income distribution. Do you dispute this?
As for erasing class distinctions, consider the possibility that we already have. Imagine telling a person in 1915 about the world today; the children of rich struggling hard in school with the goal of getting a job where they can work hard in order to provide consumption for the poor (who mostly don't work). These rich people will wear the same hoodies and turtlenecks as anyone else, live in moderately larger houses than the poor (or at least in moderately nicer locations), and have virtually no goods and services that are unavailable to the poor.
Would this modern world not count as wildly imaginative?
You are missing a big point. Sure super rich can only utilize fraction of their wealth however rest of the wealth rarely gets utilized to increase productivity of the society. The majority of investments in their portfolios (as per Piketty's carefully collected data) are actually in non-productive activities such as real estate, hedge funds, HFT, derivatives, commodity manipulation and so on. These investments manipulates markets such as real estate to perpetually increase value of their investments without positive impact on society. In fact, from analysis of Piketty's data it was found that if wealthy people only invested in "productive" instruments then their wealth accumulation would dramatically deaccelerate. So the argument that wealthy provides most of their capital for economy to bloom is fairly misleading. They do provide this capital for some GDP growth but it's fairly small part of their investment portfolio. The major portion of the portfolio has singular goal of generating massive passive income perpetually for generations by activities such as artificially limiting supply side or ballooning demand side in markets such as real estate. There are no known social advantage of these kind of investments. Next time when you send that $3000 mortgage payment, put a note there: "wealth transfer for 1%" :). See other comment: https://news.ycombinator.com/edit?id=10829915
How are real estate, hedge funds or derivatives non-productive? A hedge fund or derivative investment ultimately directs productive assets towards real world uses. If the wealthy are getting high returns from this (and Picketty claim the wealthy get the highest returns), then the wealthy are better at directing real investments to their most productive use.
Could you point me to the place in Picketty where he does more than speculate about how the wealthy gain more wealth?
These investments manipulates markets such as real estate to perpetually increase value of their investments without positive impact on society.
You seem to be confusing middle class NIMBYs (the main people manipulating real estate markets) with the very rich. Middle class homeowners are the ones preventing new construction, it's the wealthy developers who are trying (and failing) to be productive.
Money invested in real estate doesn't get used to manufacture goods and services or start industry or research or education or anything good for humanity. It's "sleeping money" as far as economy is concerned. In fact, it's worse because as more and more real estate gets owned by super rich and their investment arms, it puts more pressure on middle class by having to cut higher and higher portion of their income on mortgages and lowering their lifestyle standards, savings and risk taking abilities. As per some reports, as much as 30 to 70% of super rich portfolio gets directly in to real estate investments. As they buy up premium estates in major cities around the world, supply gets constrained, more people gets priced out of home ownership and must agree to pay ever increasing rents to those investors. It should be bewildering to anyone that this situation exists even though population hasn't been increasing much in western countries. This is known as "economic rent" (look up the term in Wikipedia) where investor strives to create a setup that passively generates income ad infinity without contributing to society. It's essentially creating generational entitlement system whereby suddenly usual economics like "you get what you worked for" no longer applies. The real estate has been primary tool for centuries to add phenomenal gains in to most of the super rich wealth and Piketty's data shows that it is the primary reason why wealthy are acquiring more wealth at rate much higher than overall GDP increase. It's hard for most people to see this because many times they are home owners benefiting from this while in reality they are not and also because they don't realize that real estate is basic human necessity just like air and water. No one wants Chinese billionaires or entities like Blackrock to buy up all of the water supply, inflate its price and then ration it to people with bidding wars. So the assertion that as super rich gets more richer, they benefit society by starting industries is pretty misguided. So far the data shows that this kind of productive investment has much lower returns than non-productive investments because of higher risk factors. So if rich were doing only doing productive investments, they would not be able to acquire more wealth at current pace.
You seem to believe the rich have the ability to somehow buy up all the supply of some good (land, water) and then arbitrarily raise the price.
As they buy up premium estates in major cities around the world, supply gets constrained, more people gets priced out of home ownership and must agree to pay ever increasing rents to those investors.
You are deeply confused. Buying up housing does not reduce the supply of living space; similarly, a rich person investing in a copper mine does not reduce the supply of copper. If the rich person makes improvements (e.g., buying land and building flats on it, buying a copper mine and expanding it) then they increase the supply.
Again, where in Piketty's book do you believe he shows that the rich buy up and artificially limit the supply of a scarce resource? Please cite a page #.
When there are 100 houses and 100 buyers in market, demand and supply is met and likelihood that transactions will yield fair prices is high. When investors from China and Wall Street descend on markets, you suddenly have 200 buyers and only 100 houses in market. If you live in a major city in western world, go meet the real estate agent nearest to you. Ask them how many bidding wars happen and how many deals are all cash. Most all-cash deals are almost always investor purchase. This is the reason (along with local laws on new construction) why we have housing inflated by massive 10% a year even though population gain is all but negligible. The result is that typical family now pays huge chunk of their income in highly inflated mortgage payment which is nothing but wealth transfer from them to super rich who hogged up critical resource in the hope to increase their investment return.
You are conflating supply of housing with real estate speculation. You might as well complain that GOOG is up $750 and AMZN is $630; this is completely true, but it doesn't make searching the internet or buying stuff online cost more.
He may be doing that, but he is not alone: the government has spent the past 8 or so decades trying to conflate the two in everyone's mind, and at this point, the only way to keep that up is to make housing into a de-facto collectible by strictly limiting its supply. This means that all those terribly high housing costs in SF are mostly economic rent, which is not productive and also tends to increase inequality. But that's not a problem caused by billionaire business owners, for the most part. It's caused by upper middle class worries about their speculative investment and the schools their children would go to, and the resulting regulatory capture.
They use the same iPhone, have access to the same chemo, and watch the same movies. The only difference is they fly in private planes instead of commercial, drive high end Mercedes instead of Fords, live in mansions instead of apartments. But their HVAC cools just the same as my window unit, it's just quieter. Yeah, they have lots of things we don't. But the difference is smaller than between a rich person in 1915 and a poor person today.
I think the life of the ultra rich is fundamentally different to the average middle income person in the same way that royalty lives a different life to a commoner. Sure we all breath, eat, sleep and procreate, but the differences in the concerns of the ultra rich and the rest of us is quite large.
A poor person today is richer in many ways to the rich of 1915 thanks to technological advance, but there still is a huge gap between the opportunities of the poor today and those of the ultra rich.
More fundamentally I just don’t think it is good for the ultra rich to live a life that is so different to the rest of society. These people have an enormous amount of power and it is not good for the rest of us if they live a life detached from the worries and concerns of us common folk. You just can’t make good decisions on the basis of bad information and if this is formed from the worries and concerns of your ultra rich friends and you then you are going to end up with a warped perspective of what life for most people.
> More fundamentally I just don’t think it is good for the ultra rich to live a life that is so different to the rest of society.
Why not? So Jay Leno has a 10,000 sqft garage and 500 cars, what do I care? Tom Cruise doesn't affect my daily life. Politicians do, and most of them are rich but not ultra rich.
People will always have a warped perspective of others, that's just how the human brain works. In fact we discuss that on HN frequently, how Silicon Valley can seem so clueless solving "white first-world problems".
The reason why I mention in the next sentence - the ultra rich have a lot of power. I want the powerful to understand how us commoners live.
The ultra rich have a very large influence over politicians. This is why they are important. If they just spent their time flying around in private jets and talking to each other then it wouldn't matter - once they start to have a very large influence over public policy it matters what they think.
As a non-member of the ultra rich all I can do is look in on the peeks they give us via the media. I am willing to admit that it is possible that they are exactly like you and me, but they certainly don't appear to be.
In regards concrete claims the ultra rich appear to far more to the economic right than the average person. I am sure you are aware of this.
Lots of groups are far to the economic right of the average person. For example, this is probably true of people who subscribe to Scott Sumner's blog.
Is it therefore reasonable to say "I think the lives of people who read Scott Sumner's blog are fundamentally different to the average middle income person in the same way that royalty lives a different life to a commoner"? If not, why not?
> In regards concrete claims the ultra rich appear to far more to the economic right than the average person.
Are you sure that's true? It may be, but there are certainly plenty of counter-examples. Gates and Buffett immediately come to mind, as well as presumably many of the people on this page: http://givingpledge.org/
I am not to sure how to the left Gates and Buffett actually are, but they are really good examples of ultra rich with the perspective of the upper middle classes. Unlike the hereditary ultra rich, they are self-made men who grew up in upper middle class families. The fact that they want to give away their wealth rather than pass it on to their children is a sign they recognise the morally corrosive nature of inherited wealth.
If I were asked I would be keen to lower taxes on incomes and raise taxes on inheritances. We really don’t need a self-perpetuating parasitic overclass.
How come they're limitless when it comes to facing off against gravity, and completely defeatist when it comes to erasing class distinctions?
The key distinction in this problem is between overcoming fixed barriers of nature and overcoming the dynamic, highly adaptable nature of human beings. Personally, I don't believe we're ever going to come up with a fixed set of laws that could constrain the infinite range of human behaviour to the realm of fairness and make cheating impossible. At least not without eliminating all freedom for everyone.
I was under the impression that Keynesian economics is/was said limitless facing off against gravity. However as was already mentioned, when these sort of experiments go wrong (e.g. Communism), they tend to go terribly wrong. It would be nice if we could actually perform these experiments on a local, entirely voluntary scale however the Fed seems to have captured that market already.
If "free market" has any coherent and muscular meaning, it is as an alternative to those in political power assigning the equivalent of royal patents to pursue markets.
So any rents-ey looking use of the political process is not free market no matter the wealth of those practicing it. This is what need work.
Wal-Mart in specific originally hired women in rural areas at a wage appropriate as a second income. Their husbands worked at an industrial or agricultural job.
Then they went through an explosion, but as the South Park says, the soul of every Wal-Mart is a mirror. The ag. or industrial job isn't there any more but by sheer momentum, that's the deal.
Wal-Mart is also not exactly a sentence of eternal penury - people who stay a few years, just by self-selection can move up the food chain. I'm not current, but a department manager made enough to raise a family very frugally. A store manager made pretty decent money.
The reason it's Wal-Mart and not Sears is decades of hard work at the logistics end - Wards and Sears shipped by train, even in the '60s. Wal-Mart just overran them with trucks.
But in a way, what's waiting for the end of Wal-Mart seems worse - Amazon. The labor component of production of goods is still disappearing.
The problem for economics as it's become very mathematical
and technical is that the intrinsic beauty and rigor and appeal
of the models themselves have become an attractor - something
that research gravitates towards. [...] There is a great attraction
in these types of models; they create a world of equilibrium,
a world of stability almost by accident - they are just a consequence
of the model, and it's a beautiful and seductive world.
Not the OP, but I think a lot more people nowadays should read (or re-read) Locke's "Two Treatises of Government". That book is famous mostly for the second part, where Locke actually intellectually imposes private property as a thing in the Western world, but I found the first part equally interesting, where Locke fights against a guy called Filmer, who was of the opinion (prevalent until then) that all property was rightfully owned by the King, transferred to him from generations past since Adam.
The thing I'm trying to say is that yes, private property is just a social construct, there's no divine nor moral thing about it, the concept came alive (so to speak) only because some guys in England didn't like that their possessions were in danger of being confiscated by the King's men.
In the end private property is indeed theft, more exactly the imposition of someone's moral values over the other's by intrinsic force (if you "steal" you might go to prison or worst). The sooner we realize this the better, there's no second-guessing about it.
Locke also wrote that "For this "labour" being the unquestionable property of the labourer, no man but he can have a right to what that is once joined to, at least where there is enough, and as good left in common for others."
Which, I think, is the central issue regarding property rights and inequality. We should question all rent generating property rights, just as Locke did, and try to find a system of propert rights where rent doesn't create inequality.
Taxation seems to be he popular approach, but why not try to redefine the rights all together? What if such property rights were time limited, and came with a fee equal to the rent potential?
There are two components of private property. 1)the raw materials (or land) 2)the labor (or improvements).
I agree with your stance on component 1. The raw materials, the land, they do in fact manifestly belong to everyone.
On component 2, the labor or improvements, I don't think those do belong to everyone. They belong exclusively to the creator who can transfer title. In fact, society has no moral claim on this component at all in my estimation.
Here is my idea. Stop funding society by taxing labor. It's counterproductive. It's morally wrong. Tax material and land use. This is what society truly has a claim on and how society should fund itself.
> In the end private property is indeed theft, more exactly the imposition of someone's moral values over the other's by intrinsic force (if you "steal" you might go to prison or worst).
What you're pointing out is a monopoly called "The Legal System": a single dispute resolution system everyone must adhere to without choice (Government/Mafia). This monopoly is often based on geolocation. Property will be inherently aggressive if one is forced to use a specific dispute resolution system.
Everyone withholds stuff from others: it is 100% universal. In this way, the notion of "property is theft" can not hold because everyone (even animals) do it: consciously or subconsciously.
There is then the system of dispute resolution. This defines if a particular act of withholding was an act of "theft".
The combination of withholding + dispute resolution results in what we call property.
Competing dispute resolution systems is really that free-market people hope for. Dispute resolution systems do not have to be based on geolocation. In fact, people form millions of these unique systems every day, freely, without resorting to monopolies or the lowest of low dispute resolution: killing one another.
> The sooner we realize this the better, there's no second-guessing about it.
So ya. Property in and of itself is not theft. Forcing others to use a specific dispute resolution could be viewed as the theft.
> In the end private property is indeed theft, more exactly the imposition of someone's moral values over the other's by intrinsic force.
I'm curious how that follows? Many actions require force but are not theft (depriving someone of rightful resources). If your 'moral' values deprive someone of their own rightful resources you probably deserve to have some intrinsic force applied. In that way private property would seem to me to be close to a moral good.
Private property can't be "theft" if there is no private property.
If you don't believe in private property, you're sort of poisoning the well of any economic conversation, since it's the foundation of basically all of peaceful civilization.
Without private property there is only tribalism and, "might makes right."
I'm not sure this is much of a counterpoint. The Inca didn't have a centralized currency, but we really don't know whether they had private property or not, how disputes were handled, or so on. They also seem to have had civil wars, child sacrifice, and other violent traditions.
That being said, many things are possible in groups with smaller populations, I've heard stories of large communes being fairly successful with up to several thousand people. However, at some point they tend to become too disorganized and break down, in one way or another.
In contrast, the concepts of private property and trade have enabled our human family to grow to 7 Billion, and population growth is barely even slowing down yet. Civilization allows things to work on an entirely different scale by providing a somewhat standardized framework for our territorial disputes.
This is also the most non-violent time in history by far, according to researchers, presumably due to the end of tribalism.
So, for me personally, there would have to be extremely compelling arguments to even begin to argue against the utility of private property as a social and economic system.
You can absolutely avoid it. Inequality was so much less in the 1950s/1960s and we still had police and property.
The disconnect here is that property rights are "more guidelines than actual rules", they are quite literally "made up". It used to be that keeping a black person out of your store was a "property right", until we decided it wasn't, and then we got rid of that one. It used to be that preventing airplanes from flying over your farm was a "property right" until it wasn't, and then we got rid of that one. You can only do that if "property rights" are artificial.
I mean just look around you. We live in a world where Smartflash has a "property right" to your in-app purchases, Apple has a "property right" to your iPad, JSTOR has a "property right" to publicly-funded research, etc. etc. That's because we made it that way; let's unmake it, and do it differently!
Not sure about whole planet but I do realize that previous generation in USA had much higher savings rate, lower student loan, much lower mortgage to income ratio and much higher probability of retirement in 50s/60s. I have never heard people from that generation believing that they were less better off financially than we do, although we do benefit from natural evolution in technology and science.
It seems like we probably benefit from an arrangement where we control the things in our immediate surroundings that we need in order to maintain reasonably stable and predictable lives. For instance it makes sense for me to control access to things like my glasses, bike, pajamas, etc. Property rights work pretty well for defining that arrangement.
At the other extreme, we have situations where property rights can be overridden, such as taxation and eminent domain, and entities whose value depends on a stable money system provided by the government -- I see no a priori reason why the workable way to manage those things is not through a system of limited property rights. In broad terms, one such limitation is an agreement that taxation is not a violation of a fundamental human right.
The more abstract and artificial "property" gets, the more reasonable that property rights are balanced against other things, such as redistribution.
This is the core of our system. And that system will always generate inequality.
Sure, and to the extent that it works, it's OK. When it doesn't work, then it seems reasonable to manage it in order to make it work better. Some broad-brush ideas are for the government to provide a functioning money system, and a way to redistribute wealth against the tide of inequality.
As a useful legal fiction subject to the same limitations as others of its genus, sure.
As a natural moral right? Not in the slightest, because there ain't no such thing. The history of "ownership" of any given thing today is basically a history of force, fraud and the occasional lucky break. Who should own a piece of land? What moral claim do they have to it? The very best that can be said today is that they can trace a chain of transfers back to the person who most recently was able to stay on that land without being forcibly put underneath it by someone else. What kind of grounding for a supposed moral good is that?
So I believe in Thomas Hobbes' conception of the state of nature -- namely, that there are no rights, no virtues, no morals, nothing but all-out war for resources, where what is "yours" is what you can take and keep by violence -- and in his conception of government as what we introduce when we get tired of that, and that this arrangement is better than the "war of all against all" even though it comes at the expense of sometimes having the government decide that "my" property could be put to a better use.
Could you post your address? I'll bet you have a lot of stuff that other people could use, and since you don't believe in property, you surely won't have any objections to them taking it.
Hobbes's thesis is ridiculous, and has been refuted at great length by many over the centuries. I see no need to go over well-trodden ground yet again, but here are a couple of points:
If you accept his arguments, you're basically advocating a dictatorship (or his era's equivalent, a king ruling by "divine right").
For another, his notion that humans are motivated purely by ego and self-aggrandizement is demonstrably wrong.
Posit a "desert island" scenario in which an adult is marooned with a small child. Assume that rescue is impossible (or at least wildly unlikely). No legal repercussions to worry about.
The child has collected some fruit, clams, or whatnot.
The adult is hungry.
In this situation, a Hobbes person would simply take the food from the child.
While there certainly are some real people who would do that, most of us would not. They would prefer to collect their own fruit and clams rather than take them from the child by force.
Even if there weren't enough food to go around, many would give the food to the child and choose to go without themselves.
As with many political theories, the Hobbes model says rather more about its originator than it does about people in general.
Remember that Hobbes was writing at a time when philosophers liked to consider a "state of nature" -- the behavior of people before organized society, government, etc., come into being.
Many of these philosophers, including John Locke (who Jefferson cribbed heavily from when writing the US Declaration of Independence), wrote as if the morals of Enlightenment-era westerners would magically naturally exist in people living in such a "state of nature", and simply took them for granted.
Hobbes pointed out that this was balderdash. Our entire conception of propriety, of right and wrong, of what is or isn't acceptable, comes not from some natural moral law engraved into our hearts or deduced in an ideal pre-society state of pure reason, but rather is inculcated into us by the culture in which we live. So Hobbes dismissed the idea that people would be respectful and helpful in the "state of nature" and pointed out that, since that stuff only comes into being later with organized society, none of it would exist at that point. Hence the war of all against all.
Which is where your desert-island analogy, and most other attempts to tear down Hobbes' state of nature, fall apart: your stranded people come in with experience of an organized culture which taught a particular set of morals and norms. One of those norms is that the adult should go hungry to let the child eat, but there is no guarantee that some natural moral law written in the adult's heart would have produced the same outcome absent years of indoctrination in a particular culture's moral system (and in fact, in actual nature we can find examples of animal species where adults will kill and even eat young of their own species).
There are different kinds of property rights. We have intellectual property - the use of state force to impose the idea that information is scarce when it is naturally not - we have real estate, where an arbitrary box of space relative to planet Earth is assigned to you - and we have traditional goods, where you can have an apple and claim it is yours.
The first two are complicated, because they are extremely political. To own geographic space is entirely divisive from owning just the dirt under a house, or the physical material that composes it. To own an idea, a trademark or a patent, is to assign exclusivity to thoughts. Its much easier to say "we have scarce goods, so those that create them can sell them, and the buyer owns it". Its why I think goods property is a good thing, but our attempts to strong arm real estate and IP into the same formula is a cause of constant economic tension because they aren't a good fit.
Just in this context for reference, I'm an IP abolitionist and think we should adopt homesteading of property again. Both forms of state granted monopoly to space and idea are being rampantly exploited by market forces and were conceived of in an age when technology did not enable the information exchange we have today. It would have been much more complicated to verify usage of a plot of land a hundred years ago than it would now, to know who previously owned it and for how long it has been unused before you could claim it as your own.
Clearly the parent does not believe in property rights when they believe unskilled non-differentiated labor should be rewarded with above market rates by force and at the expense of Walmart's shareholders.
That individuals believe government should be directed at investors who risk their property to create wealth in order to take by force that property to redistribute it is perhaps the most offensive sentiment.
> There is no reason why the bulk of the billions taken-in by WalMart should go to the Walton family while their employees live on food-stamps - that is just a legal arrangement. And there is no reason why the Walton family should continue to be allowed to use offshore corporations to loan themselves money to run all their WalMart stores - that is just a legal arrangement which allows them to avoid taxes and hide their billions offshore
I can think of about a million sentiments more offensive than the idea that people who invest should be taxed and that we should have a social safety net.
Ha, there aren't a million other sentiments in the grandparent comment.
No one is arguing the value of the social safety net. The comment goes above and beyond the safety net suggesting it shouldn't be needed and the remedy is redistribution. A safety net is one thing but arbitrarily inflating wages is another.
I don't believe the suggested remedy would be proposed by someone who believes in property rights. Further, as a person who believes in property rights I do find the sentiment of theft of property for redistribution offensive.
I am opposed to social wealth re-distribution or the idea that one should not be able to filthy rich. However we need to make sure that balance of level playing field is maintained (for example, education and healthcare remains affordable for all), political power doesn't get bought up by few and necessities such as real estate doesn't become investment tool to artificially constraint supply and inflate prices.
Not quite the same sentiment and you have mis-attributed the quote.
If a violent revolution comes, I'd be thinking more about those pervasive comments touting a belief that theft of private property is somehow justified. I'd suspect those making such comments would be a little more regretful to see their rhetoric fulfilled.
If you truely believe in property rights, you will get in big trouble from philosophical point of view. For example, if you live in US then very likely you will need to surrender your property to last know Native Amarican owner :). In Saudi Arabia, the ancestors of Saud family declared entire country as their private property. The result was that when oil was found there in 1930s, about 2/3 of the income was used by Royal family as their private income to build legions of palaces with elaborate gardens while millions of poor people went without food. Even today Saud family has about 5000 Royal princes, each one with their giant share of country's fortunate based on ancestral claims. This is ofcourse not new to Saudi Arabia. Most of the Monarchs all over the world believes entire country was their private property and people living there was just happened to bestowed the permission to stay there. How does property ownership philosophy sound now when you take it extreme?
But you choose to ignore the other extreme. I mean that of 100% abolition of property rights, i.e., a recipe for anarchy. Of course you can truly believe in property rights when they are set according to an evolved legal constitution. That's how human beings work to form a better society. There is no such thing as 'trouble from a philosophical point of view' unless one thinks that the space between ALL and NOTHING is blank.
I'm not against property right at all. I was just making logical argument to poke holes to show that something is at miss in asserting in its puritanical form. The property rights are generational because of ability to transfer those rights. This immediately establishes generational lock down if resources are limited while keeping less fortunate out. This applies to resources such as real estate and political power however not to resources that are unlimited such as creativity and innovation. A large number of people currently live in poverty because there is simply no way for them to acquire education, nourishment or healthcare because they couldn't chose their parents correctly. This doesn't necessarily imply re-distribution of wealth or socialization programs or welfare state or guaranteed basic income or even charities as the solution. In fact, they are almost certainly not the solution. I think we do not yet have correct model for economic rights and rewards established for modern human society. It is also likely that purely economic solution does not even exist given the innate human nature. In that case, the technology might be our only savior where by one day we can have virtually unlimited energy source and robotic savants to create age of abundance.
That's absolutely true. But while physical laws just exist, "economic laws" are a complicated combination of biology, psychology, social norms, the legal system, etc.
You can tweak the rules, but you can't run calculations that predict the results. Some of those legal arrangements might be unjust, but their results might be net-good all the same. We can, and should, keep evolving the social bargain, but upending it completely is very dangerous.
It's interesting that you faced this issue and came away with the exactly wrong conclusion. Economics is, at root, a physics problem. There's no way to get around that. Every aspect of the field comes down to asking questions about physical resources and their uses.
People can attempt to ignore the fact that economics is a special application of physics, but they can't escape the consequences of ignoring reality forever. The belief that it's all just conventions and cultural agreements is exactly like believing that the Moon is just a bedtime story.
> Every aspect of the field comes down to asking questions about physical resources and their uses.
Nope. Moving 200 million in rock or 200 million in a paper check (or even a promise-based conversation). The extractable amount/usage of Labor and Resources outstrip the human ability to account for it. This has less to do with physics and more to do with "accounting". Without accounting you cannot have negative wealth, for example. This is not tied to physics. This is based on social contracts...all the way down to the currency.
I am a little interested in this physics-based economy you speak of.
What you are referring to is more the traditional distinction between the materialists (i.e. Marx) and those that believe in market forces (i.e. Smith).
I don't understand the hate against Walmart. It only has a profit margin of 3.12% [1] and return on assets of 7.69%. Now I suppose you could argue that all the profits are hidden away somewhere, but that sounds like an unfalsifiable statement. It certainly would be illegal to hide assets from shareholders.
You're talking to someone who has spent most of his life in the Fortune 50 - working with executives who routinely hide the bulk of their wealth from any accounting. These techniques have been widely discussed in the press (if you look). So I must assume that you have, for philosophical reasons, chosen to disbelieve that the rich hide their wealth.
Edit: Not sure why I was downvoted. But I was in the room as we reassigned profits to offshore entities for accounting purposes. And I was in meetings with our senior executives who were arranging to pay themselves in undervalued offshore stocks "off the books". Those offshores provided inflated services and inflated goods to the corporation and avoided taxation while making the executives rich. The value of those offshore stocks was "reinflated" with a phone call. And that is just one company - the Big 3 accounting firms provide these services routinely for both the corporation and its executives. (And when we reassigned profits that had the effect of lowering profits - and even making income disappear. I've seen these techniques used at more than one company.)
There is IRS accounting and GAAP accounting. You try to reduce profit for the former and maximize for the former.
Off shoring subsidiary profit shaving is a fairly common practice for IRS accounting. But all the profit stays on the corporate parents books in one way or another (they own the subsidiary). The point isn't to make the executives rich, but to make the shareholders richer by avoiding taxes.
Paying people in undervalued stock is common, but "off the books" sounds illegal. I don't know what that means.
Also most companies would never sell shares of it's subsidiaries. They like having total control of the subsidiary.
Big 4 firms wouldn't fuck over shareholders to get executives rich. Executives are small fish compared to the sorts of institutional investors who own F50 companies.
It's the Big 4 instead of the Big 5 because Arther Anderson got caught cooking Enron's books. It destroyed the firm. They aren't going to risk their entire business for some Walmart execs worth a couple million dollars.
F50 executives aren't the people who actually own the world. They are people who work for the people who own the world. If the executives are stealing, it's not something that is accepted. If found they'd be totally fucked.
Through tiny portions of the stock. For mature public companies, executives own very little of the company unless they are founders or heirs of founders.
He's not saying the rich don't hide their wealth: he's arguing that corporations do not report artificially lower profits and then proceed to deny returns to their wealthy owners.
Whenever I have a chance to learn some of these legal means of avoiding excessive taxation, I do in earnest. I see very wealthy people and it only drives me to emulate their business and investment strategies more. There are more than enough legal means of structuring your businesses, transactions and investments in ways that drastically reduce taxation. I made it about 4 years without paying any state or federal income tax. True it took a lot of work and planning, but the income retained was more than worth the effort.
I think people are uncomfortable with the fact that despite of razor thin margins, multiple members of Walton family are in top 20 most wealthiest people on planet while majority of their workers lives on conditions that borderlines poverty. So somehow mass accumulation of wealth was possible at all but the top. Logically, this argument is weak because even if you redistribute all wealth from top, each employee would gain barely a one time payment of $10,000 just due to massive size of Walmart and would not significantly improve their condition over long term. So wealth re-distribution is not the cause of poverty of Walmart condition.
Perhaps you should read up on it's labor practices. Two cases in point: They encourage their employees to sign up for food stamps, which results in a $6.2B government subsidy[1]. Also, the workers are intentionally paid so little (via only part-time employment) the company asks customers to donate food to their employees.
I know this was a week ago you wrote this but I only today came across this essay by Georg Henrik von Wright called "Humanism and the Humanities" that I think is apt.
In §13 he says (and I'm going to quote the thing in full),
<blockquote>I shall now advance a thesis which I am sure many will find controversial but which I think is true and, moreover, crucial for understanding the methodological status of the humanities and the relation of the humanities to the sciences of nature. The thesis goes as follows:
Just as natural, i.e. non-intentional phenomena are 'governed' by natural laws, i.e. principles which tell us either what will invariably or in statistical average be the case under in principle recurrent and repeatable circumstances, in an analogous manner intentional phenomena are 'governed' by normative rules which tell us what people under given circumstances are (or were) expected or allowed or practically necessitated to do. I am, in other words, pleading for what might be called a 'methodological parallelism' between natural laws on the one hand and laws and other societal rules on the other hand. I am inviting you to see the difference between the humanities and the natural sciences in the light of the difference between the factual and the normative, between rules which state how things in fact go and rules which ordain how they should go according to the conceptions of those who instituted the rules.</blockquote>
Oh come on. I've started a manufacturing business with my smarts, a hammer, a tape measure, and a saw. In 5 years I will sell it for several million dollars.
When a convicted felon can do that, the argument that we don't live in a Free Market doesn't hold any weight, imho. A person can find a need, build a business around it, and become powerful and have money.
Yes, exactly this. We choose the rules, so we can push to have rules that don't have those people on food stamps. Unfortunately when you bring this up, most people can't countenance it.
> Does anyone really believe that if only the rules weren't "rigged" local shops and businesses would be able to compete against Wal-Mart and Amazon?
There's at least one.
Mom and pop can easily compete with Wal-Mart and Amazon if there was a level playing field. You just don't understand how twisted the playing field is because you have zero experience with retail and logistics.
The big boys get tax subsidies when they move in, they get concessions from local governments, they get favorable treatment at the border with customs, etc. and that's just on the surface. They get huge discounts from UPS for infrastructure build-outs, but then UPS again gets subsidized through the roof in the same ways Amazon is directly. So on and so forth.
Mom and pop can get the same prices out of China, it has nothing to do with scale. After you're ordering a container worth of stuff, you're not going to reduce the price of whatever you're selling by buying more. That's why Amazon doesn't manufacture much and relies on the Mom and Pop to do that sort of thing, while still kicking Wal-Mart's ass.
As far as Mom and Pop vs Amazon ... Amazon wouldn't allow them to sell on their platform if they weren't a threat. But they do and they are. There's a reason eBay is a multi-billion dollar company and has been for a while.
>Does anyone really believe that if only the rules weren't "rigged" local shops and businesses would be able to compete against Wal-Mart and Amazon?
What would happen is that Wal-Mart and Amazon, et al. would pay their fair share of taxes, and the owners (or share holders) would not be multi-billionaires, only single-digit millionaires at most. The effect would be that every single person in the United States would have Heath Care, Tertiary Education paid for, excellent unemployment benefits, etc. etc.
There would no longer be desperate people struggling to survive while others have orders of magnitude more money than can be spent in 10 lifetimes.
> the owners (or share holders) would not be multi-billionaires, only single-digit millionaires at most.
Mmmm, I don't think your numbers add up...
There are 500 people in the US who have more than a billion dollars. If we made them all "single digit millionaires", we'd be looking at a one time wealth transfer of less than a $1T dollars, or about 25% of the US Federal Budget for one year. Sure, that would make for a good year, but then it's spent and we're back where we started...
I think you're dramatically overestimating how much private wealth there is in the hands of the upper echelon compared to how much the sorts of programs you want would cost.
I liked how you undermined your own argument. If we truly are back where we started then we just do it again, and continue with the money being given to people who then spend it.
> It's wishful thinking. The rules don't drive rewards to the top. It's intrinsic to the free market.
No it isn't, we make the rules of the market, and we could just as easily change those rules to force companies to give more of their earnings to their employees rather than filtering it all up to the top. The market is what we make it, it has no intrinsic nature. The rules are rigged, by and for the wealthy, that is a fact.
The companies themselves don't really have any capacity to enforce these "rules", they have to petition the government to do so. The end result is regulatory capture. How do you expect to "force companies to give more of their earnings to their employees rather than filtering it all up to the top"? More government, I guess? We've seen how this goes.
You could always dissolve the legal concept of the publicly owned corporation and only allow employee owned corporations. Thats actually less government, because right now we have a government that has to write and enforce laws for both forms of business.
Exactly, simple rule changes like that could radically alter society. Not that I agree or disagree, but that example does support the main point, the rules matter and can be changed.
Oh its almost certainly a terrible idea (at least if done that drastically) if for no other reason that massive upheavals of the status quo tend to harm the poor the most. It is just yes an example of the sort of "fundamental" of our economy that's actually just the result of some rules we made ourselves, not something inherent in capitalism or free markets.
Less drastically you could make employee/consumer owned businesses dramatically more tax advantaged giving them an economic edge and then just seeing what happens. Might turn out awful but its certainly possible.
As just one example, tax reform[1], punish companies with high gaps between their highest and lowest paid workers. It's quite easy to force companies to do things, you just change the rules. When a company does better, the benefits of that productivity should not all go to the top; the employees should share in the wealth they created. Companies who share their wealth with their employees would get more favorable tax rates. Incentives matter.
Yes, and these incentives are likely to cause companies to use subsidiaries and contract workers, so that their employee count is lower and the median wage of those employees higher.
It's not clear to me that's a win for anyone other than consulting companies, tax prep and CPA firms.
> Yes, and these incentives are likely to cause companies to use subsidiaries and contract workers
Only if the proposed change in rules contains such glaringly obvious loopholes; but I doubt that'll be the case, as the people trying to solve the problem have thought about it for more than 5 minutes.
Let's agree to disagree. While the current system, at least in the USA, is not perfect, it is still better than other systems tried in other countries. Things that I would fix is decrease corruption as much as possible. What you are advocating is communism.
If you really believe in your system start a company and employ your ideals. I'm sure you will have no lack of talented individuals wanting to work for you for a greater piece of the pie. In no time you should be able to destroy that evil Walmart corporation that practically enslaves its employees. Please try it and prove us all wrong
I don't want to sound harsh but there really are people that deserve what's coming to them. In my high school too many kids wasted their time while trying their best for me to also waste my time. They had all these incredible opportunities to better themselves and still ended up as loosers destined to work minimum wage. And now you are saying that that is unfair and they deserve more. I think not. They deserve what they work for.
The USA will give you rent assistance, medicaid, food coupons, financial aid, student loans and if you still cannot drag yourself to college then it is on you. I know because I come from all the way in the bottom. The only thing that stopped all my friends from following was: nothing.
> While the current system, at least in the USA, is not perfect, it is still better than other systems tried in other countries.
No one said it wasn't.
> Things that I would fix is decrease corruption as much as possible.
As would I.
> What you are advocating is communism.
No it isn't, tax reform is not communism, I suggest you bone up on what communism actually is before continuing this conversation, nothing I said is in any way communist.
> I don't want to sound harsh but there really are people that deserve what's coming to them. In my high school too many kids wasted their time while trying their best for me to also waste my time. They had all these incredible opportunities to better themselves and still ended up as losers destined to work minimum wage. And now you are saying that that is unfair and they deserve more. I think not. They deserve what they work for.
>Does anyone really believe that if only the rules weren't "rigged" local shops and businesses would be able to compete against Wal-Mart and Amazon?
To look at just one example, how long did it take to force Amazon to collect the kind of sales tax that mom and pop shops had to collect from the start?
> Does anyone really believe that if only the rules weren't "rigged" local shops and businesses would be able to compete against Wal-Mart and Amazon?
We're talking about corruption and you're listing companies best known for getting where they are through aggressive free market competition. Can't we come up with some better examples than that?
AT&T, Goldman Sachs, Bank of America, AIG, Monsanto, Elsevier, Microsoft, Sony, Pfizer, Halliburton, Exxon, Lockheed Martin.
And it isn't that some startup would otherwise show up and dethrone Exxon as the largest oil company in America, it's that Exxon lobbies to make sure it gets a fat stack of cash from Uncle Sam for oil exploration while fighting against tax credits for electric cars. It's that Elsevier lobbies to have taxpayer-funded research behind a paywall.
These things put money in the pockets of the companies doing the lobbying at the expense of all the rest of us.
I'm curious in what ways Monsanto is corrupt. Forgive me if this sounds like an obvious point, but I've seen too much GMOphobic noise around this to know where the signal is.
The problem with the GMO debate is hysterical people keep making unscientific objections to the general concept of gene modifications instead of specific objections to actual problems.
Monsanto makes Roundup (glyphosate)-resistant crops. As far as anybody can tell the gene modifications have no inherently harmful effect on the resulting food. But then all the crops get sprayed with glyphosate and the food is contaminated with glyphosate.
Monsanto is also very aggressive about asserting ownership of the seeds that grow from the plants that grow from their seeds. If the neighboring farm plants Monsanto crops and the seeds blow into your farm, lawyers follow. It's basically an intimidation tactic; buy seeds from Monsanto or you may end up with them anyway, and then you're going to get sued.
So farmers buy the seeds, to such an extent that it's become a biodiversity problem. Their crops are becoming a monoculture. Think systemic risk like the housing crisis, but this time it's the food supply.
In other words, there are legitimate reasons to object, even if they aren't the ones most popularly aired. So people may want to know when they're buying GMO crops and potentially contributing to these problems. Even if some people start avoiding the GMO crops for other reasons with no rational basis, that still helps with the biodiversity problem. But whenever a bill comes around to label them, guess who shows up to lobby against it.
Roundup doesn't contaminate plant products, because it's applied when the plant is still tiny. It does, however, contaminate rivers.
Farmers don't get sued by Monsanto because they accidentially get seed blown on their fields - that's practically legally impossible, given that Monsanto enforces its policies using licencing laws, not patent laws. If you disagree, please provide an example of such a lawsuit.
Monoculture is popular even without GMOs.
There are many things wrong with GMOs and surrounding industry, but what you list above are not problems, but lies.
Can you explain why they would bother to do that if it doesn't end up in food?
> It does, however, contaminate rivers.
It does also contaminate rivers.
> Farmers don't get sued by Monsanto because they accidentially get seed blown on their fields - that's practically legally impossible, given that Monsanto enforces its policies using licencing laws, not patent laws. If you disagree, please provide an example of such a lawsuit.
I see you're not familiar with the modern process of aggressive legal trolling.
It goes something like this: Some people sneak or lie their way onto your farm to check if your crops are an infringing variety and if they are (regardless of why or how) you get a settlement demand letter. If you pay the money and sign the NDA then it all goes away but nobody ever finds out because you can't talk about it.
If you don't then they file a lawsuit, which will end up costing you a huge pile of money to defend from even if you win, and all the pretrial legal processes get rolling and you start incurring big legal fees.
After they've stuck you with a big pile of legal fees and looked at all the discovery, if you haven't settled yet, then they decide whether their case actually has any merit. If it doesn't then they make the settlement offer very attractive so that you pay almost nothing but sign the NDA to make the legal fees stop accumulating. If you refuse that then they drag it out as long as they can and keep burying you in pretrial legal process hoping you'll change your mind, but if you don't then they ultimately drop the case before trial.
So the only cases anyone can point to of someone going to trial are the ones where Monsanto actually has a case. For example, there was a famous case in Canada where the farmer took it all the way to the Supreme Court and lost. In that case Monsanto had originally claimed patent infringement (note: not a licensing dispute) for the crops from seeds the farmer claimed had blown in from the neighbor's farm, but come to find out that after that the farmer harvested the seeds from those plants (allegedly on purpose) and planted the next year's crop with them. So by the time it went to trial Monsanto had dropped the claim for the original year's crops, even though they had made it during settlement negotiations, and the trial was only about the farmer purposely replanting the patented seeds.
> Monoculture is popular even without GMOs.
I'm trying to imagine what point you think you're making. Something is a problem, so making it worse is OK?
Monoculture occurs when one strain of a thing dominates the market, generally by out-competing all the others under currently prevailing market conditions. GMO crops are obviously specifically designed to do that. It's the same with intentional crossbreeding, but they're better at it so it's worse. Monsanto also claims the rights to seeds bred from their seeds, so farmers who plant Monsanto seeds have little incentive to experiment with creating new derivative varities because Monsanto will claim all of the profits from your work, so why bother?
Now suppose we label GMO crops. That won't actually remove them from the market because they still have the advantages the modified genes provide, but more people will refuse to buy them, increasing demand for non-GMO crops and inhibiting GMO crops from becoming a large supermajority.
The biodiversity within the non-GMO segment of the market will then tend to be larger than it is within the GMO segment because there will be different seed lines with different advantages and disadvantages, and you can't grab exactly the gene you want out of each of them to make seeds that have both advantages at the same time as easily as you can with GMO crops, so more different seeds will be able to carve out a market niche.
Thanks for the reply. I'm glad I have more arguments against Monstanto now.
Reading the Monsanto vs Schmeiser case, however, it seems pretty clear that Schmeiser infringed the patent (he intentionally used it without having the legal right to do so); we can argue (and probably agree) whether patenting of genes should be allowed or not, but assuming the patent is valid, Monstanto had morally won the case.
> assuming the patent is valid, Monstanto had morally won the case.
That was my point. The process is designed so that any case where that is not the predictable outcome will be settled and put under NDA so nobody can know about it. The process that results in that consequence is the despicable act, and is what causes the intimidation, because it allows them to claim having won every case etc.
I don't think that the rigged rules lead to consolidation of wealth per se, but I do think people would be much less upset about consolidation of wealth if the rules weren't rigged.
I think the intent here is political rule rigging such as capital gains taxes which leads to situation where middle class has higher tax rate than super rich. There is plenty of political purchasing goes on every day by big shots as Donnald Trump often reminds us (he obtained several permits with phone calls to politicians). Personally I don't think mom and pops shops died because of rigged rules. They simply can't compete with economies of scale and selection. That's just evolution and survival of the fittest.
Maybe "rigged" is the wrong word but googling: "The 1976 top federal tax rate on regular income was 70% while the rate on capital gains was 39.9%"
Had they left things like that, present inequality would be much less. We don't live in a world of unregulated capitalism. We live in a world of regulated and taxed capitalism and the wealthy have modified those regulations and taxes in their favour.
> But the prescribed fix is to "raise taxes on corporations and the ultra-wealthy".
Yes, as a first step. Then you use the proceeds to subsidize college tuition and health care to help level the playing field for young people, so they can get into the workplace with an education but without crippling debt. And then as a side-effect, the ultra wealthy will no longer have as much disposable income that they can use to influence politics, so maybe we can get enough non-corrupt legislators in office to roll back some of the unfair laws that were passed that allow, for example, Wall Street bankers to commit massive fraud with impunity.
If you're going to criticize and idea you should at least criticize the whole idea, not just a little piece of it. You can make any proposal look stupid if you ignore 80% of it.
The tax code and it's loop holes designed for corporations and ultra-wealthy = bad rules. You "bait-and-switch" too.. pretending to care about fixing rules and making society better when you only care about billion dollar corporations that pay less taxes than the window cleaners working there.
There is a lot of talk here about income inequality being a fairness problem, but not as much about it being an economic problem. But if people don't have money they can't buy anything. If those poor people had more money they would just go back to Walmart and give it back to the Waltons, which is a good thing to have that economic activity.
Wealth gains are not a zero sum game. It is about how much we produce. If the economy is not operating at peak productivity (for example with a lot of people out of work), then not as much wealth is created. And this will happen when there a lot of people who can't buy much, making demand low. It is a vicious cycle.
In the US the wealthy have lobbied to push down their taxes, and this is an example of what people mean when they say the system is rigged. This can help those rich people on an individual level and in the short term. But it also effectively takes that money out of the economy, since the rich typically don't go and spend that money but save it instead. If that money went to taxes it would have stayed circulating in the economy, whether it is used to pay for college tuition or used on some pork barrel project.
This is the argument made by some for economic inequality hurting the economy.
It's not about big business vs small business. It's about wages. Big businesses are not inherently bad, but so long as they are beholden to shareholders because capital gains are more valuable than production, the more they are going to screw over workers to reward investors.
There is a very common tendency to focus on consumption, in terms of where rich people's money flows. This argument that the rich spend most of their money on ostentatious goods (e.g. fancy cars) or, in the case of this posting, donations to political or even charitable causes. While there is of course some truth to this, it ignores the elephant in the room which is that the rich DON'T spend most of their money. The vast majority of wealth (individual, corporate, and sovereign) is tied up in investments and other liquid or illiquid assets. One of the biggest symptoms of the current malaise in terms of inequality are the abnormally high asset prices globally (and thus lower yields), and most essential, very low inflation. There are huge sums of money in the economy that have been pumped in since 2008, but inflation has not shown up in 7 years largely because velocity of money is down. The concentration of wealth, and possible talk about technological deflation, are both closely tied up in this. The lower classes which tend to spend all their money - and sometimes money they don't even have - contribute disproportionately to velocity, now likely don't collectively have enough money to really drive economic and monetary trends anymore. Especially, if they are burdened by debt repayments which many in this day are.
I think one of the biggest problems that we have today is that intelligent, hard-working people are the poorest they've ever been.
In the past, if you studied and worked really hard, you would usually achieve something. Today you can study and work very hard for a very long time and still end up with nothing.
Being smart or trying hard has very little value, it's all about who you know and what assets you own. Today, most people are just living off of their assets. Assets which they received as a result of a lot of luck and perhaps a bit of hard work.
Instead of the government stepping in to protect the people - The government is facilitating this inequality by allowing corporations to carry-out mutually-beneficial deals with one another at the expense of regular people.
People are being enslaved; not just less-educated people, but also highly educated people (who can actually see/understand what is happening).
I think we have a new economic class in our society, the 'highly educated lower class'.
>> The reality is that for the past 40 years, Wall Street and the billionaire class has rigged the rules to redistribute wealth and income to the wealthiest and most powerful people of this country.
> This is the problem.
That is a very good way to put it. I agree with that.
> So why doesn't Graham recognize and advocate this?
He doesn't advocate because it won't help his cause. As I posted in the comment of the original article (which got downvoted, nobody likes pg being accused of manufacturing pr? https://news.ycombinator.com/item?id=10827175, hey! it's a submarine ;-).
He created a strawman and a narative around how to interpret and think about income inequality to give his followers and those involved in startups a framework. He understands he is part of what can create inequality, and that's bothersome to him and those around the startup culture. Startup environment needs myths to operate. These are promises to investors, promises to early employees, these are things founders are supposed to be telling others ("I want to make the world a better place") and perhaps themselves as well. There has to be a myth created that addressed income inequality, because it is talked about in the media.
As a joke, someone wrote (and I forgot who) how the wealthy and powerful in this country are devout Marxist followers. They internalize the rules and assumptions of the class struggle. Except they don't identify with the working class, they identify with the bourgeoisie. They understand there are the two classes and what class they belong to. They will actively try to control and supress the lower classes.
>So why doesn't Graham recognize and advocate this? Perhaps it's because two of his biggest golden geese — Uber and AirBnB — are actually relying on exactly the kind of political influence I'm calling out here in order to survive and prosper.
Whether this is true or not, we need to realize PG has motives. He doesn't write essays just for his health.
Having read PG's essays since 2002, I suspect his motive is that he wants to have good ideas. The kind that will be remembered after his death. He even said as much in one of his essays [1]. He's writing for legacy, not for profit.
YC itself was one of those ideas - it started out as an experiment [2], derived from a talk at Harvard Computer Society [3]. The easiest way to test if an idea is a good one is to go do it, so he did, and it turned out it was, and that led to profit.
I don't think it's fair to attribute Machiavellian scheming to PG. There are some other people in Silicon Valley that will take a position and then influence public opinion to make that position come true, but it's pretty rare, and I don't think it's the case here. Rather, it's the same reason all VCs talk their book: they start with a hypothesis about how the world is, then invest their book according to the hypothesis, and then tell everyone what the hypothesis is. The worldview comes first, the investments come second.
From half a world away I wouldn't say his motives are "Machiavellian", but his style and the subjects he wrote about definitely changed just after reddit and especially YC became important, mostly for the worst/not-interesting.
I think I started reading his essays in 2004 or so, and he was a cool guy, not as cool as jwz, for example, but pretty interesting nevertheless because of his story of actually making some good money out of having used LISP (which back then was like a Nirvana-reaching thing, I mean, making big money out of LISP) and for being a programmer who was actually showing interest for other things outside programming, like Renaissance painting (Christopher Alexander and his Turkish rugs' patterns was also a thing back then among programmers).
But then reddit launched, YC was founded, somehow they started making money, and things like Arc and trying to make LISP a world-dominating language became things of the past. That's when his writings became a lot less interesting for guys like me, i.e. for average programmers who just wanted to read what other guys smarter than them had to say.
Coming also from half a world away from Silicon Valley (Europe), I also think there is a large discrepancy in PG's essays before and after YC became successful. Before YC was successful, I felt that his essays were written by a very smart guy who thought a lot about various topics, and his advice made lots of sense (don't go for prestigious fields for prestige's sake, find what you really love, etc.), while now it feels that he's thinking that everything converge to make startup the only path to success (I'm exaggerating a bit, but not that much). I don't think he does that to bring more and more people to apply to YC, but I can feel the influence on spending lots of time with VCs and startups.
It's closer to "for health" than you'd think. If you talked to PG about this I'm sure you'd come away with the same sense. My impression is that he writes essays as a way of thinking and because it makes him happy.
Edit: these are representative of talking to him about it:
I bet he writes as a way of thinking and it makes him happy. I bet he has biases, leanings, and motives too. Some of them are private or even subconscious.
Uber hired lobbyists because they had no choice. Traditional companies have captured the regulatory system so bad you have idoitic laws designed to protect them.
In London one law was proposed for a minmium wait time of 5 minutes. It was directly aimed at uber.
>The Baumol Effect, in case you didn't know, is the tendency of wage increases that come from increases in productivity to "spill over" into jobs where there have been no productivity increases. In other words, it's trickle-down economics under a fancier name.
Mr. Garret gets the definition of the Baumol Effect more or less right, but then mislabels it as trickle down economics and proceeds to attack that. Here is an example of the Baumol Effect:
As improving technology makes computer scientists more productive they will receive higher salaries in the business world. Meanwhile, computer scientist teachers in academia may not see similar productive gains (they still can only teach X number of students a semester). Nonetheless, universities must increase computer scientist teacher pay to prevent them from leaving academia for the business world.
In the context of PG's essay, he is saying that high pay for entrepreneurs forces companies to pay competitive salaries:
>anyone who could get rich by creating wealth on their own account will have to be paid enough to prevent them from doing it.
If Mr. Garret, or others, disagree with this assertion they should attack it directly. Personally, the logic and direct incentives at work seem self evident to me.
> It is possible to address this problem without killing the golden goose. How? By rolling back some of the legislation that was put in place by undue political influence.
Using the political system to reduce the influence of money in politics is prohibitively difficult because the system is already captured by money. We should try, but we need other options when that fails.
When government stops responding to the wishes of the people, revolution is the typical answer. Luckily, we don't have to do that. We can end the influence of wealth on our politics without needing the government to do it for us.
Instead of trying to get the government to stop excess political spending, we should eliminate the incentive to accept excess political spending. People accept money to influence our democracy because they can use that money to get whatever they want from almost anyone, including you. You can't opt out because economic power is invisible. But we can make it visible, and give every individual the freedom to reject economic power that they feel is misused.
@pg is basically arguing that fragmentation is leading to the end of oligarchy and this author is arguing we are headed toward it.
Who's right? The comments I've read today on a few of these posts today are so divisive that I'm not certain they come from the same universe.
FTA: On the other hand, I also want an effective, democratic government to provide infrastructure, protect people from extreme economic contingencies (like war and hurricanes), prevent people from profiting from economic externalities (like pollution) and provide oversight for well-regulated, free and transparent markets. And that's not the direction we're heading. We're heading towards political power being concentrated irreversibly in the hands of a small minority. We're heading towards oligarchy.
> If the differences in income and wealth were entirely reflective of people's productivity and contributions to society there would be no problem. But they aren't. Instead what is happening is that the ultra-wealthy are using their disposable income to buy political influence, then using that influence to get laws passed that allow them to collect rents.
If you're arguing the problem is the ability of the political class to pick winners and losers instead of creating rules that are beneficial to society generally and applied to all equally - amen.
It's a symptom but not as claimed of the ultra-wealthy buying influence. That matters too but it's not the number one reason. If that was the case, other countries with much less ability to affect the political process (like the scandinavian countries) wouldn't be experiencing the same problems (although at a different scale)
No. Wealth is a symptom of a system where the winner takes all and the winner is increasingly technologically based companies.
Wealth allow you to increasingly affect the political process but only as a function of you being rich to begin with. No one starts with the political system to gain wealth at least they wont' be wealthy for very long if thats how they came to their wealth.
Income inequality is increasingly a symptom of systems with little friction to become the first or second in a field but a lot of friction to challenge them.
I don't think Uber is a YC investment. It's certainly not listed as such under CrunchBase, nor have I seen any public article mentioning them as an investment.
Access to resources & social attention are key concerns.
Some harmful effects of inequality when people do not have access to:
* needs (i.e. Maslow Hierarchy); particularly autonomy
* ability to express perspective
* ability to have perspective considered, paid heed to, & respected
* ability to influence local systems
* protection from those who are abstracted away from local systems; those who will not feel immediate consequences of their actions
If we can create systems where these concerns are prioritized, then inequality of wealth may not matter.
Some people are good at playing the game of gaining wealth. Some are good at other games. In the end, we all benefit from respecting and having compassing & empathy for all life & natural systems.
It looks to me like Garret and Graham are actually in violent agreement. :-) Garret wants to keep people from getting rich through political influence rather than creating wealth; Graham wants to make sure people can still get rich through creating wealth, even if they can't get rich through political influence.
Wealth inequality and income inequality are often touted as the incentive for people to do actual useful work.
However, if you think about it for a second, it's clear that having more money in a bank or on a payslip doesn't make you work harder.
What makes you work harder is the possibility of improving your status, getting richer.
So, one would imagine that a society with drastically reduced inequality (both wealth and income) but with extra high social mobility could work perfectly well.
Um, am I the only one here confused at why this guy is arguing with PG? From what I can tell they are in full agreement.
Ron here is saying we shouldn't kill startups (what PG calls "creating wealth"), we should instead fight against practices that actually take money from the poor and give to the rich (what PG calls "zero-sum games"). After reading PG's article, I got the impression that he wants the exact same thing as Ron does. What's there to argue?
PG even has a paragraph in his essay that is almost equivalent to the title of the article:
> There are lots of things wrong with the US that have economic inequality as a symptom. We should fix those things. In the process we may decrease economic inequality. But we can't start from the symptom and hope to fix the underlying causes.
This is a great discussion on the single most important issue of our day. I like Paul Graham's perspective on this but I would like him to elaborate on how he would curb corruption. In the past, he said that "transparency" was key but they are doing this in the open and they direct the media to put a spin on it which the non-critical thinking masses can't detect. Politics/economics is an imperfect entity. I think the "pragmatic" solution may lie somewhere between Graham's Libertarian view and Sander's Democratic/Socialist view.
"At the very least, we should strive for a non-regressive tax system, which is what we have now."
I'm super pro regressive taxes. Regressive taxes are fantastic for the poor. They get more than they put in AND the elite are less able to avoid paying them. The socialized promised lands of Scandinavia are highly regressive.
Your link's graph shows that nordic countries have highest social transfers and highest consumption taxes. This means that they are countering the regressive effects of consumption taxes with other income transfers. What the graph doesn't show is that income tax (and many other fees/taxes) are also quite progressive in these countries. So the graph supports Krugman's claim of high consumption taxes in these countries, but not your claim of on "highly regressive" taxation.
Krugman's other reference has a broken link but his text does not sound like your claim either.
But in the big picture, income transfers do seem to be more favoured in strong welfare states than progression in the tax system. The US has a mongrel system with EITC because you get a "negative income tax" by social criteria (basis of which are quite 1950's...) - it's more like a social transfer in many respects than a tax progression.
Regressive taxes do not correct the use of money as a tool of political empowerment, though. They cause the problem. Its not about having social safety nets, its about nobody having the wealth to be powerful enough to own government.
Sure they would. Just imagine we had a 100% VAT on all goods and services (except essentials such as food). Now imagine you're running ZannyPAC with a fund of $100 million dedicated to the campaign of Joe Sixpack for US president. By law right now you can't just give Joe Sixpack all that money; you have to spend it on his behalf through advertising, venues, promotional materials, etc. Well guess what? For all of those things you'd be stuck paying the 100% VAT; that means $50 million of your fund would be taxed and used to pay for services to help people: health care, child care, parental leave, housing.
Hmm, I always thought that forming an AB would allow you pay less tax. Instead of drawing a salary, you'd just take dividends once a year.
Though probably missing something here, but that would let you get away with a lot of money. Or you know, just base in Switzerland.
So "the elite are" are certainly avoiding it. Unless by elite you mean the average employee.
I might be wrong here, I hope someone will correct it.
I am also pro-regressive taxes, but they need to work. Not sure if they can with the mobility or definition of "the elites".
Pg's main point is that the major source of wealth inequality comes from wealth creators as opposed to wealth exploiters. The wealth creators are typical startups and people creating new industries while wealth exploiters are the one playing high frequency trading, lobbing congress, buying up real estate, creating monopolies, investing with insider info and so on. My gut feeling is that wealth creation part is in reality less than 20%. This intuition is based on simple fact that wealthy people have managed to far more disproportionately increase their wealth than what comes from increase in GDP or other measures of productivity. There is plenty of analysis available in Capital book that clearly suggests that wealthy people mainly invests in non-productive investment instruments such as real estate that has nothing to do with increasing productivity of the society. It just constraints the supply side, inflating prices and thus increasing value of the investment. These investment tools enables them to transform themselves to become passive wealth exploiters with a setup that generates massive multi-generational income and wealth increase without proportional need for positive contribution to society. There was a very well written article with data analysis on HN that proved that most increase in wealth for top 1% came from these non-productive investment tools such as real estate. This is like wealthy people grouping up to buy loads of the fresh water and inflating prices so average people now must pay majority of income in buying water. So wealth transfer from common people to rich occurs through inflated water prices. Of course, if wealthy people really did this for water, they will be in trouble and revolutions will break out. However doing this for real state raises no eye brows even though real estate is essential need for humans.
A fun fact: Despite of giving billions and without starting any new blockbuster companies, Bill Gates has managed to increase his wealth by more than 50% since he officially retired. He has sure helped few startups but it would be too funny as well as cruel to think that most of his wealth gain comes via helping startups or causing productivity gains in society. Last I checked his billions are managed by hedge fund like setup who typically have goal to maximize returns through non-productive instruments such as real estate, HFT, commodity market games, derivatives etc and they rarely devote more than 20% of portfolio to truely productive activities such as startups.
It is also marvelous how some of the wealthiest have outright bought the laws for themselves, for example, middle class in US universally pays almost twice the tax rates than top 1%. This would be unthinkable in previous generation. The entire capital tax gimmic is put in to law with a full knowledge that it does not benefit majority of citizens who have little or no savings, let alone investments for short term trading. It is purely designed to benefit top 1% who derives large chunk of income as capital gains. The most depressing thing is that the field is becoming less and less level playing, for example wealthy can buy out admissions in best universities while average citizens are getting priced out from same institutions. The significant increase in mortgage and student debt load combined with long term stagnant wages now eliminates possibility of savings or investments and therefore risk taking. I suppose this wasn't exactly like this in 70s when many more people had decent savings, had ability for some risk taking and lot of them even actually were able to retire. In our generation most people don't even think of retirement anymore except in tech industry which is probably less than 5% of population. We in tech field are perhaps not so much impacted and so world looks little different from our glasses, especially if you had been college dropout or without family. However for a common citizen with a family, mortgage, healthcare bills, no savings, retirement funds uncertainty and student loans it is much more difficult to cross the chasm than it used to be in 70s.
Define "communist", and we can have a meaningful debate.
This is the point: The US right tries to label anything they perceive as to the left of it socialist or communist and by extension to equate all of these ideologies with Soviet or Chinese inspired socialism with total disregard for the fact that while it also includes related ideologies, this spectrum also encompasses ideologies that are further apart than Republicanism and Stalinism.
It just becomes comical when e.g. European style social democrats gets lumped in with Stalinists, ignoring that Stalin himself ordered all Komintern member parties to treat the social-democrats as fascists (more precisely they were deemed to be "social fascists") and to oppose them with the same urgency as they opposed Hitler, effectively destroying any chance of a united opposition to Hitler, and draining both.
And it just becomes ridiculous when libertarian and moderate socialists who fought the Bolsheviks authoritarian tendencies tooth and nail and often lost their lives also gets lumped in with them: Millions of socialists and communists and anarchists were amongst the 10 million dead during the Russian Civil War - fighting alongside the White's to oppose Lenin. Thousands died in the Kronstadt rebellion, demanding reinstatement of free speech. Rebellion after rebellion against the Bolsheviks were arranged by SR, Left SR, the Mensheviks and other left wing groups, leading to executions after executions, and starting in 1922 a concerted campaign of political show-trials. Tens of thousands of them were murdered after the Moscow Processes by Stalin in the 30's - at that point Stalin was even purging opposition inside the Bolshevik party.
Many, many more perished in labour camps or had been wiped out together with other political opponents in the years before for standing up for democracy.
So, if you define what you consider socialism and communism, we can nail down which of these groups you are including, and how many of them were actually actively opposing the mass murders you are referring to and/or were victims of them.
While I agree with you about questioning number of deaths by capitalism, your first link is laughable. Maoist Rebel News, really?
Deaths are counted multiple times, cigarette related deaths worldwide are capitalism fault, children killed by hunger are capitalism fault (especially in North Korea), famine of 1932-33 is capitalism fault (this one is really fucked up, because it is exactly the opposite).
The comment you're answering to cited "Canada, Australia, England and Argentina". None of these nations has anything to do with communism. What the propaganda has created is the idea that anything that isn't Reaganomics means Socialism which mean Communism which means murdering millions of people.
Incidentally, and I've mentioned this before, the complete tone deafness of the US right in this question is pretty much directly responsible for making it possible to have productive debates with Americans about socialism again.
When even Obama - a conservative not much left of Reagan, that not that many years ago could have fit into the Republican party politically - was repeatedly accused of being a socialist there was a watershed.
More and more the response was a "well, I kinda agree with Obama, so if he's a socialist, why do they say it's bad?" curiosity.
The only reason it didn't backfire far worse was that there was no strong social democrat or socialist political organization ready to benefit. But I strongly believe that the only reason Bernie Sanders is getting any kind of hearing this election campaign is that the right laid the groundwork by making the term "socialist" socially acceptable again amongst large groups of the US public
They overplayed their hand massively, and legitimated discussions of socialism by making the category so ridiculously over-broad that they defined people into it and forced those people to re-evaluate socialism rather than re-evaluate their own viewpoints. It's a truly classic failure to understand the psychology of propaganda that deserves treatment in university courses on psychology:
You don't win a propaganda war by saying "these viewpoints you agree with makes this guy you're considering to vote for a [insert label believed to be offensive here]". You win propaganda wars by disassociating your opponent from the views of his base and presenting yourself as the protector of the same views.
The right way to have fought Obama was not to label him a socialist, but to upstage him and paint him as unwilling to go far enough, and twisting the mechanism to fit whatever they'd wanted afterwards. It's not like this is a new strategy: Specifically within the context of welfare and healthcare, it was first used by Bismark in the 1880's, leading to the first welfare state, but at the same time both shoring up the German state by undermining support for revolutionary socialism, and establishing an insurance system that persists to this day that avoided a nationalisation of the entire system.
Instead they walked right into what may turn out to be one of the largest political own goals for decades.
Religion has killed a lot of people as well. In fact, for that matter so has capitalism. But I don't necessarily blame the ideas of religion or capitalism for the deaths.
In truth, the point is a bit worn out and overused and doesn't say much about the underlying ideology.
The 100 million civilians murdered by communist/socialist governments is well documented. What are the numbers for capitalist governments murdering their civilians without even the semblance of a fair legal system?
It's a trap. He's gotten you to apportion numbers.
The point is that it is irrelevant in the first place because the people he wants to lump in with mass murderers like Stalin or Mao or Khmer Rouge largely have never supported them or policies anything like theirs.
The discussion of numbers is pointless without first getting him to narrow down exactly what ideologies he is referring to by nature of actual policies implemented rather than by massive overloaded names.
The debating technique is equivalent to trying to argue that democracy is bad because the Democratic Peoples Republic of Korea is oppressive and tricking us into trying to turn it into a comparison of relative authoritarianism based on flawed, self-selected labels.
Instead it is the premise of what is included in the label you must challenge. It unravels quickly.
It can all be reduced to the problem of man-made law. It is wide open to abuse. So, yes, the ultra-rich abuse man-made law to make more money. But then again, machine guns easily overrule money. That is why there are now islamic insurgencies, in 30+ countries, of which the primary purpose is to get rid of man-made law (and to establish their favoured alternative). The problem goes way beyond the distribution of income. At some point, everybody who believes in the legitimacy of man-made law will have to prove that he is willing to risk his life and die for what he believes in.
Scriptural law, for example. Each religion enforces its own law. This solution may not be ideal in every possible respect, but to the extent that it puts a halt to the invention of new man-made laws, it will certainly mitigate the problem. Every man-made law represents a reduction in your freedom with the purpose of serving the interests of someone else. Therefore, I am in favour of any alternative solution that will put a halt to people inventing new laws.
A consistent set of traffic rules is a mathematical problem. Mathematics emerges from the laws of nature. Traffic rules are a prime example of what would go totally wrong if you tried to solve it with typical man-made laws. Instead of giving priority to traffic coming from the right, we would end up giving priority to traffic of the members of the elite instead. In fact, that is what happens in many countries. Furthermore, in case of a traffic accident they always find man-made "legal" reasons why the elite is right and everybody else is wrong.
The op explains very succinctly the problem in this quote:
> what is happening is that the ultra-wealthy are using their disposable income to buy political influence, then using that influence to get laws passed that allow them to collect rents.
My primary beef with American politics is the "solutions" are always in the form of bandaids - they focus on the effect, not the root cause. The recent healthcare laws are a prime example. How to handle the rise of ISIS is another. Both were caused, or at least compounded by misinformed short-sighted policy. The answer is rarely "more laws". Especially when more laws was what lead to most of these problems in the first place. It's like writing more code around terrible code when what is really needed is a total refactor and proper test coverage.
Ending cronyism is fairly straight-forward. But stacking on more law is only going to exacerbate the issue, because like the op explained - the well-connected are just going to buy more political influence and have the laws crafted to benefit them. Taxation is more complex. Increasing taxes is often a solution proposed. Fine, but first - the government needs to prove that they are good stewards of our money before reaching into my back pocket for more. Otherwise, that increase is going to end up as farm subsidies and in the pockets of "defense" contractors.