Billionaires, making the world a better place (for them)

[OldGimletEye]

Just now, SeanF said:

My impression (on this side of the Atlantic) is that for most people, the standard of living in the USA is well above what it is here, but for the bottom 20%, it's better here than in the USA.

That maybe or may not be true. But, the point is that economic growth hasn't really improved with so called supply side policies. 

In fact, over the 20th century, Democratic Presidents seemingly were better at than Republican ones.

And of course, talking solely about economic growth, which is how conservatives frame the discussion typically, biases things in the conservative direction. Now even though they talk about it a lot, but really suck at it, here in the US at least, really what is of interest isn't growth per se, but economic welfare. People have tried to argue for aggregate measures besides GDP growth to measure welfare. And well they are right. Not that growth isn't important, but it isn't the whole story.

[Jo498]

18 hours ago, Rippounet said:

This does tie in with something that's been nagging me for a while about the way we perceive wealth and money. There's this insidious idea on the right that everything earned is "yours" and that taxes and wealth redistribution are some kind of theft.

This was addressed by that great American socialist Ben Franklin; in very general terms that don't presuppose any Marxist (or similar) notions of exploitation etc. (I added the italics)

"The Remissness of our People in Paying Taxes is highly blameable; the Unwillingness to pay them is still more so. I see, in some Resolutions of Town Meetings, a Remonstrance against giving Congress a Power to take, as they call it, the People's Money out of their Pockets, tho' only to pay the Interest and Principal of Debts duly contracted. They seem to mistake the Point. Money, justly due from the People, is their Creditors' Money, and no longer the Money of the People, who, if they withold it, should be compell'd to pay by some Law.

All Property, indeed, except the Savage's temporary Cabin, his Bow, his Matchcoat, and other little Acquisitions, absolutely necessary for his Subsistence, seems to me to be the Creature of public Convention. Hence the Public has the Right of Regulating Descents, and all other Conveyances of Property, and even of limiting the Quantity and the Uses of it. All the Property that is necessary to a Man, for the Conservation of the Individual and the Propagation of the Species, is his natural Right, which none can justly deprive him of: But all Property superfluous to such purposes is the Property of the Publick, who, by their Laws, have created it, and who may therefore by other Laws dispose of it, whenever the Welfare of the Publick shall demand such Disposition. He that does not like civil Society on these Terms, let him retire and live among Savages. He can have no right to the benefits of Society, who will not pay his Club towards the Support of it."

http://press-pubs.uchicago.edu/founders/documents/v1ch16s12.html

Now Libertarians like Nozick like examples of a sports star like Messi or someone like JK Rowling who don't obviously profit from capitalist-worker power differentials etc. but people voluntarily and gladly pay them money for being able to watch Messi play football or read the newest Harry Potter. So why should their millions be taxed away?

In the vein of Franklin I would reply that Messi has not created football neither the technological and societal structures that make it possible to leverage his skill so that it is worth man millions. It's a lucky break that an ability that would have been almost worthless in 400 BC Athens or 1780 Boston and barely made a living for a few years even as late as the 1950s, can earn him millions in the world of 2010-19 and he has not created the circumstances that made this possible and sustain the society that worships sport etc. So the Publick has in some sense created Messi's wealth and therefore it is just to tax away considerable amounts of that wealth. (The actual rates are a different question, of course.)

[Isalie]

Great post yo! (Jo)

[Kalbear]

When JK Rowling and Messi are the most rich people on the planet, I'll be cool with that argument. They aren't billionaires, so I don't care. 

[Serious Callers Only]

That millionaires, much less billionaires (or the probable trillionaire that willl happen in a unleashed mafia oligarchy government -  Russia being the most obvious candidate, but fascist america being good candidates too, with mr 100 billions Jeff Bezos) even exist is a affront to liberty of course. That is the truth behind the 'conservatives'. They're employees of capital and just like in the gilded age, will take and take until they're stopped.

And ofc, there is peak oil, generalization of automation to ruin all unskilled jobs, climate warming, nazis with 'economical anxiety' and christian and muslim fascists and corrupt insiders waiting as reactionary and violent forces against the necessary wealth redistribution. It's a choice between genocide, and serfdom or directed economy at this stage, and i'm pretty sure the mafia oligarchies will go full neo-colonialist, oppression and even coup against rational socialist responses in both local and foreign governments. Why else have both private prisons, drones and facial recognition databases and private armies of mercenaries? Why else sabotage education and healthcare? If you're poor or brown, or atheist or (even) Democrat, they want you to die and will not be satisfied with it happening slowly.

[SeanF]

9 minutes ago, Serious Callers Only said:

That millionaires, much less billionaires (or the probable trillionaire that willl happen in a unleashed mafia oligarchy government -  Russia being the most obvious candidate, but fascist america being good candidates too, with mr 100 billions Jeff Bezos) even exist is a affront to liberty of course. That is the truth behind the 'conservatives'. They're employees of capital and just like in the gilded age, will take and take until they're stopped.

And ofc, there is peak oil, generalization of automation to ruin all unskilled jobs, climate warming, nazis with 'economical anxiety' and christian and muslim fascists and corrupt insiders waiting as reactionary and violent forces against the necessary wealth redistribution. It's a choice between genocide, and serfdom or directed economy at this stage, and i'm pretty sure the mafia oligarchies will go full neo-colonialist, oppression and even coup against rational socialist responses in both local and foreign governments.

 

I'd expect a society without millionaires to be a horribly oppressive place in which to live.  Owning a decent house in London is enough to be a millionaire in this day and age.

[Ormond]

29 minutes ago, Kalbear said:

When JK Rowling and Messi are the most rich people on the planet, I'll be cool with that argument. They aren't billionaires, so I don't care. 

Well, although Rowling's net worth may have dropped below a billion dollars for a few years after 2012 due to her own charitable giving, most recent estimates put her over a billion again.

Of course the "billion dollars" figure is arbitrary and I'm sure there are many billionaires worth a lot more than she is. 

[Serious Callers Only]

11 minutes ago, SeanF said:

I'd expect a society without millionaires to be a horribly oppressive place in which to live.  Owning a decent house in London is enough to be a millionaire in this day and age.

Because 'houses in downtown london' are a fucking money laundering operation. Precisely because of the corruption that millionaires enable. Britain (at least) would be immeasurably improved by detonating* these empty houses in NY and London, since most of them are just tax avoidance and money changing hands with the corrupt, not without 'side effects' either. Such as the generalized price increase because there are some oligarchs playing patsy cake, 'i pay triple the market price with my blood money' with flats (though of course, the middle class greed with flat flipping shouldn't be underestimated).

 

*this is sarcasm but still serious, though of course, reusing them for useful things or residents or building new price controlled ones would be better than destruction.

[Conflicting Thought]

Just now, SeanF said:

I'd expect a society without millionaires to be a horribly oppressive place in which to live.  Owning a decent house in London is enough to be a millionaire in this day and age.

I would like to understand this point, could you expand on why you expect a horribly oppressive place without millionaires? 

[OldGimletEye]

6 hours ago, SeanF said:

I'd expect a society without millionaires to be a horribly oppressive place in which to live.  Owning a decent house in London is enough to be a millionaire in this day and age.

I personally I don't have a problem with some with wealth inequality.

But, the problem here in the US in particular is there is a lot of self serving nonsense that comes from the United State's elite. You have people like Bernie Marcus running around telling us how corporate tax cuts will get us to the promised land. Well we just had them, and there is hardly any evidence that it boosted investment one iota. 

And don't even get me started on people like Jamie Dimon, who has been basically wrong about everything, but is thoroughly convinced of his own awesomeness. In particular, his complaining about equity capital requirements is nonsense.

And then they warn us about the grave dangers of things like minimum wage laws and unions. Except nobody in their right mind would apply the competitive and partial equilibrium model to the labor market. There are too many informational problems to think it applies.

And the whole problem is made worse by the United States Supreme Court's refusal to back off from its mindless proposition that the giving of money is tantamount to free speech. It would be nice, if perhaps, they would take a look at the things free speech is supposed to foster before sticking with that position.

[SeanF]

7 minutes ago, Serious Callers Only said:

Because 'houses in downtown london' are a fucking money laundering operation. Precisely because of the corruption that millionaires enable. Britain (at least) would be immeasurably improved by detonating* these empty houses in NY and London, since most of them are just tax avoidance and money changing hands with the corrupt, not without 'side effects' either. Such as the generalized price increase because there are some oligarchs playing patsy cake, 'i pay triple the market price with my blood money' with flats.

 

*this is sarcasm but still serious, though of course, reusing them for useful things or residents would be better than destruction.

Most house owners in London are owner occupiers.  

3 minutes ago, Conflicting Thought said:

I would like to understand this point, could you expand on why you expect a horribly oppressive place without millionaires? 

In the UK, you don't have to super-rich to have a million pounds in assets.  About one in seven adults do.  That's several million people who are having their assets confiscated if you want a society without millionaires.   A government which stops people from owning nice houses, holding private pensions, investing in shares etc. is an oppressive government.

[SeanF]

3 minutes ago, OldGimletEye said:

I personally I don't have a problem with some with wealth inequality.

But, the problem here in the US in particular is there is a lot of self serving nonsense that comes from the United State's elite. You have people like Bernie Marcus running around telling us how corporate tax cuts will get us to the promised land. Well we just had them, and their is hardly any evidence that it boosted investment one iota. 

And don't even get me started on people like Jamie Dimon, who has been basically wrong about everything, but is thoroughly convinced of his own awesomeness. In particular, his complaining about equity capital requirements is nonsense.

And then they warn us about the grave dangers of things like minimum wage laws and unions. Except nobody in their right mind would apply the competitive and partial equilibrium model to the labor market. There are too many informational problems to think it applies.

And the whole problem is made worse by the United States Supreme Court's refusal to back off from its mindless proposition that the giving of money is tantamount to free speech. It would be nice, if perhaps, they would take a look at the things free speech is supposed to foster before sticking with that position.

I wouldn't disagree with a lot of that either.

[SeanF]

2 hours ago, Jo498 said:

This was addressed by that great American socialist Ben Franklin; in very general terms that don't presuppose any Marxist (or similar) notions of exploitation etc. (I added the italics)

"The Remissness of our People in Paying Taxes is highly blameable; the Unwillingness to pay them is still more so. I see, in some Resolutions of Town Meetings, a Remonstrance against giving Congress a Power to take, as they call it, the People's Money out of their Pockets, tho' only to pay the Interest and Principal of Debts duly contracted. They seem to mistake the Point. Money, justly due from the People, is their Creditors' Money, and no longer the Money of the People, who, if they withold it, should be compell'd to pay by some Law.

All Property, indeed, except the Savage's temporary Cabin, his Bow, his Matchcoat, and other little Acquisitions, absolutely necessary for his Subsistence, seems to me to be the Creature of public Convention. Hence the Public has the Right of Regulating Descents, and all other Conveyances of Property, and even of limiting the Quantity and the Uses of it. All the Property that is necessary to a Man, for the Conservation of the Individual and the Propagation of the Species, is his natural Right, which none can justly deprive him of: But all Property superfluous to such purposes is the Property of the Publick, who, by their Laws, have created it, and who may therefore by other Laws dispose of it, whenever the Welfare of the Publick shall demand such Disposition. He that does not like civil Society on these Terms, let him retire and live among Savages. He can have no right to the benefits of Society, who will not pay his Club towards the Support of it."

http://press-pubs.uchicago.edu/founders/documents/v1ch16s12.html

Now Libertarians like Nozick like examples of a sports star like Messi or someone like JK Rowling who don't obviously profit from capitalist-worker power differentials etc. but people voluntarily and gladly pay them money for being able to watch Messi play football or read the newest Harry Potter. So why should their millions be taxed away?

In the vein of Franklin I would reply that Messi has not created football neither the technological and societal structures that make it possible to leverage his skill so that it is worth man millions. It's a lucky break that an ability that would have been almost worthless in 400 BC Athens or 1780 Boston and barely made a living for a few years even as late as the 1950s, can earn him millions in the world of 2010-19 and he has not created the circumstances that made this possible and sustain the society that worships sport etc. So the Publick has in some sense created Messi's wealth and therefore it is just to tax away considerable amounts of that wealth. (The actual rates are a different question, of course.)

I would take the view that the work of great artists/writers/musicians was in the past, seriously undervalued.  If they came from the upper classes, they were seen as gifted amateurs;  if they came from the lower classes, they were viewed as skilled artisans.  I'm glad that they can make fortunes these days.

[OldGimletEye]

1 hour ago, SeanF said:

I would take the view that the work of great artists/writers/musicians was in the past, seriously undervalued.

Well by the logic of the market they weren't undervalued. At one time, before the invention of the printing press, the marginal cost of making a book was quite high. That means the supply of books was restricted. And then because around the same time, because most people weren't literate there wasn't a particularly large demand for them. The upshot is you probably weren't going to get very rich by writing books.

If you were born around 1000 AD, you could have been the greatest literary mind ever in all of human history, but you'd probably need to keep your day job of shoveling shit for half a pence an hour.

Your birth had some real bad timing. Too bad, you hadn't been born a 1000 years later.

Libertarians like Nozick believe taxes are immoral because it robs people of their just desserts, evidently. But if your wealth or lack thereof is to a significant extent a matter of the timing you came into the world, it's hard to follow Nozick's logic exactly.

[Clueless Northman]

Any system that allows a person to become a billionaire is inherently broken. I would say it needs fixing, but the sad truth is, when it's gone this far, it's probably too broken to actually be fixed.

 

And to be blunt, I wouldn't have a problem if the inequality in earnings was in a reasonable margin, say 1 to 4 between the poorest worker and the guy who earned the most in the society. But I consider it highly difficult if not impossible to justify a bigger gap than that.

[felice]

8 hours ago, Free Northman Reborn said:

Why should your wealth be linked only to the labour you deliver? Should you not be rewarded for taking risk as well?

If a billionaire invests a million dollars in a business, they're risking ending up with only a paltry $999 million to their name. How incredibly, 'credibly brave! They most certainly deserve massive rewards for that! Of course, if they invest in hundreds of different businesses, the net risk is effectively zero, and they're practically guaranteed millions in rewards every year, but that's just a minor technicality, right?

While if someone earning ten dollars an hour invests ten dollars, they're probably missing a meal, and might get a couple of dollars a year in reward. I dunno, that seems like a slight imbalance in risk/reward ratio between the billionaire and the worker?

8 hours ago, OldGimletEye said:

I wouldn't try to get rid of all billionares per se. But, here in the United States, we probably have more than we need.

Why on Earth would you need any billionaires?

1 hour ago, SeanF said:

In the UK, you don't have to super-rich to have a million pounds in assets.  About one in seven adults do.  That's several million people who are having their assets confiscated if you want a society without millionaires.   A government which stops people from owning nice houses, holding private pensions, investing in shares etc. is an oppressive government.

In a millionaire-less world, nobody could afford a million-dollar house, so the value of residential real estate would plummet. Most of those millions of people would cease to be nominal millionaires without losing anything. Personally, I think it's more important to ensure everyone has access to decent housing than allowing a minority to own exceptionally nice houses. And who actually wants to invest in shares etc just for the sake of it? What people actually want is either financial security (which can be provided without requiring them to invest privately) or to get rich off other people's labour (I don't think that desire trumps people's right to not be exploited).

[Bennis of the Brown Shield]

26 minutes ago, Clueless Northman said:

Any system that allows a person to become a billionaire is inherently broken. I would say it needs fixing, but the sad truth is, when it's gone this far, it's probably too broken to actually be fixed.

 

And to be blunt, I wouldn't have a problem if the inequality in earnings was in a reasonable margin, say 1 to 4 between the poorest worker and the guy who earned the most in the society. But I consider it highly difficult if not impossible to justify a bigger gap than that.

I think your post represents this discussion quite well, in that one side is arguing from a moral perspective and the other one from a pragmatic one. 

I think it is justified to have a certain degree of inequality in society if it means everyone gets better off in the end, whereas others think that it is more important that the system is morally fair rather than that it is effective. Like when medieval Christians banned interest on loans because it was "immoral to make money from money", thus preventing the formation of a functioning financial system and hence also much in the way of entrepreneurship, innovation, or economic growth. 

[OldGimletEye]

7 minutes ago, felice said:

Why on Earth would you need any billionaires?

Supposing we set taxes, anti-trust regulation, minimum wage laws, intellectual property laws, etc at optimal levels and there are still some billionaires? Am I going to worry about that a lot? No not really. If we changed these policies, there would probably be a lot fewer. And we probably would have lot less wealth inequality. But, if there a few, I'm not going to sweat it too much.

[SeanF]

20 minutes ago, felice said:

 

In a millionaire-less world, nobody could afford a million-dollar house, so the value of residential real estate would plummet. Most of those millions of people would cease to be nominal millionaires without losing anything. Personally, I think it's more important to ensure everyone has access to decent housing than allowing a minority to own exceptionally nice houses. And who actually wants to invest in shares etc just for the sake of it? What people actually want is either financial security (which can be provided without requiring them to invest privately) or to get rich off other people's labour (I don't think that desire trumps people's right to not be exploited).

Plummeting property prices would leave people with mortgages in a lot of trouble, as they would be worth more than the houses they were secured on.  The supply of credit would shrink, placing property ownership out of reach for most people.

Nor do I think that very nice houses for a minority mean people in general can't be well-housed.   People in Western countries are mostly better-housed than any previous generation have been, despite the fact that some of them live in much nicer houses than others.  And that's because a gradually rising standard of living enables them to buy the houses they live in, and makes it profitable for developers to build properties for sale.

 

[SeanF]

8 minutes ago, OldGimletEye said:

Supposing we set taxes, anti-trust regulation, minimum wage laws, intellectual property laws, etc at optimal levels and there are still some billionaires? Am I going to worry about that a lot? No not really. If we changed these policies, there would probably be a lot fewer. And we probably would have lot less wealth inequality. But, if there a few, I'm not going to sweat it too much.

I think one needs a system in which some people can become billionaires, if one wants society to prosper.  Even social democratic Western societies have billionaires, even if they're more heavily taxed than billionaires in the USA.