Wealth and global capitalism

[Doktor]

For a while, I have been thinking that if one can implement a system where wages go up and down with company performance and putting safety net like minimum wage as a way of protecting the labor... Sounded about right.

However, that way no company will be able to hire new people without shrinking the profit margin, which will in turn lead to a serious degradation of their competitiveness.

[tbm3fan]

Capitalism may not be perfect. But what is the alternative?

I like rich people. I want to be rich one of these days. So don't tax them.

Maybe so but you don't stand a snowballs chance in hell ever being one of those 85 much less 850. The game is rigged against people like you or for that matter all of us.

[Doktor]

With more multi-naires not giving the wealth to the kids the playground becomes more leveled. One can hope at least ;)

[astralis]

doktor,

For a while, I have been thinking that if one can implement a system where wages go up and down with company performance and putting safety net like minimum wage as a way of protecting the labor... Sounded about right.

IE most waiters living on tips...:)

however, for the most part people DETEST this type of system because of the arbitrary factors (if the larger economy goes into recession, sometimes it doesn't matter HOW well the employees work, for instance). thus the economic concept of wage stickiness.

[Doktor]

Astralis,

IE most waiters living on tips...:)

They don't have safety net. Do they?

however, for the most part people DETEST this type of system because of the arbitrary factors (if the larger economy goes into recession, sometimes it doesn't matter HOW well the employees work, for instance).

Yeah, it is better to lay them all off ;)

thus the economic concept of wage stickiness.

Yep, it works that way, but the % of the turnover for salaries remains more or less the same.

As I said, my theory was utopian one.

[gunnut]

Maybe so but you don't stand a snowballs chance in hell ever being one of those 85 much less 850. The game is rigged against people like you or for that matter all of us.

Really? Explain Mark Zuckerberg, Bill Gates, Warren Buffett, Sergei Brin, Steve Jobs, or on a smaller scale, David Tran (founder of Huy Fong Foods).

I understand the it's hard to become filthy rich. I don't expect to become filthy rich. But I also don't hold a grudge against rich people. Let's just say I have never been offered a job by a poor person.

[tbm3fan]

Really? Explain Mark Zuckerberg, Bill Gates, Warren Buffett, Sergei Brin, Steve Jobs, or on a smaller scale, David Tran (founder of Huy Fong Foods).

I understand the it's hard to become filthy rich. I don't expect to become filthy rich. But I also don't hold a grudge against rich people. Let's just say I have never been offered a job by a poor person.

Easy they were very smart people in the very right place and the very right time at a very young age. In short all the planets were in alignment for them. I take it you are no longer a teenager in the right place...

[astralis]

it's really a balance. to begin with, there's a LOT of genetic lottery involved; successful entrepreneurs are usually quite intelligent, combined with drive, a certain degree of cunning, and for many, EQ skills. you have to have a disposition that laughs at the concept of a work-life balance and is willing to take risk.

if you also have the right upbringing that helps as well. note in the list of big entrepreneurs above, many of them were already middle-class or upper-middle class to begin with. then to be born in the US (although this is rapidly becoming less necessary for success).

this is not to take away from any of their achievements, but i think it's important to note that most people do not have all of these abilities, in-born or not. current-day Republican policies (note, a distinction from conservative here) look for economic growth by focusing almost exclusively on entrepreneurs, or "job creators" in that parlance. a mistake, i think, both economically or morally-- economically because it ignores the potential economic growth that can be gained by assisting a much larger group of people, and morally because frankly, if you've won the genetic lotto you're already one very huge step up from your peers.

[gunnut]

Easy they were very smart people in the very right place and the very right time at a very young age. In short all the planets were in alignment for them. I take it you are no longer a teenager in the right place...

I know I'm not smart, I'm lazy, I have no creativity, basically no talent at all. I will never be rich in this life time short of some miracle like winning the lotto or hitting jackpot in vegas.

But I am fine with that. I don't begrudge rich people. I don't hate them for having more. I don't want government to take away their money any more than I want government to take away my money.

What's so wrong about that?

[gunnut]

it's really a balance. to begin with, there's a LOT of genetic lottery involved; successful entrepreneurs are usually quite intelligent, combined with drive, a certain degree of cunning, and for many, EQ skills. you have to have a disposition that laughs at the concept of a work-life balance and is willing to take risk.

if you also have the right upbringing that helps as well. note in the list of big entrepreneurs above, many of them were already middle-class or upper-middle class to begin with. then to be born in the US (although this is rapidly becoming less necessary for success).

this is not to take away from any of their achievements, but i think it's important to note that most people do not have all of these abilities, in-born or not. current-day Republican policies (note, a distinction from conservative here) look for economic growth by focusing almost exclusively on entrepreneurs, or "job creators" in that parlance. a mistake, i think, both economically or morally-- economically because it ignores the potential economic growth that can be gained by assisting a much larger group of people, and morally because frankly, if you've won the genetic lotto you're already one very huge step up from your peers.

And we should use the power of government to "level the playing field?"

Some people are born beautiful. Most are not. Some are very athletic. Most are not. Should we do something about them too? I mean it's just not fair that Scarlett Johansson looks better than most women I know or Sidney Crosby can skate circles around me.

I don't hate them. I don't think they owe me anything. I don't think they should be forced to give up part of their success to help anyone.

Why is that wrong?

[Nightowl]

And we should use the power of government to "level the playing field?"

Some people are born beautiful. Most are not. Some are very athletic. Most are not. Should we do something about them too? I mean it's just not fair that Scarlett Johansson looks better than most women I know or Sidney Crosby can skate circles around me.

I don't hate them. I don't think they owe me anything. I don't think they should be forced to give up part of their success to help anyone.

Why is that wrong?

"You didn't build that". And it's unfair when the rich employ loopholes to end up paying -less- tax than the middle and lower class. The roads that your company's trucks do their deliveries on contribute to your success, pay your share.

You can have all the success in the world without problem, but if others are starving, yes, we're gonna ask you to contribute a bit more.

Or are you seriously trying to argue that people who lost out on the genetic lottery just deserve to be miserable? To suffer?

[astralis]

gunnut,

I don't hate them. I don't think they owe me anything. I don't think they should be forced to give up part of their success to help anyone.

on the contrary, the rich pay significantly less as a percentage of their wealth than we, the middle-class, do.

it's not just loopholes; it's simple reliance on capital gains taxation instead. it's access to off-shoring and financial instruments and global markets and private funds that no one else can access.

as i've said this entire thread, the wealthy have a far higher capacity, and a far easier time, of making money. wealth-earning becomes exponential and not linear. indeed, after a certain point, personal ability and money-making capacity no longer need to correlate. i do not begrudge this, in fact, i encourage it. but taxation-wise, treating them the -same-, or even giving them advantages, vs money-grubbing wage earners is foolishness. as f scott fitzgerald said: "Let me tell you about the very rich. They are different from you and me."

[Red Team]

6 Things Rich People Need to Stop Saying | Cracked.com

I think I did post this sometime ago but it seems relevant again so I dug it up. It's more a humorous piece than anything, but this quote especially summarizes the role rich people need to take on:

In the adult world, we get asked to do things because shit needs to get done. It has nothing to do with fairness, it has nothing to do with judging you. It has nothing to do with you at all. There's a whole world out there, with people who need helping and projects that need accomplishing.

You're only being asked to pitch in because you have the resources. You're not a tall person who us dwarfs are jealously trying to cut down to size. You're a tall person being asked to get something down from a very tall shelf because nobody else can fucking reach it.

[snapper]

I have not had much time to discuss or follow the wider ecomic issues lately due to other matters but I would make this interpretation from the two claims made in the thread:

1. The 85 Richest People In The World Have As Much Wealth As The 3.5 Billion Poorest
2. "We are experiencing the greatest increase in standards of living, for the most people, at any time in all of human history."

Yea, because there is more debt, both Government and private, than ever before. We are stuck in an ever growing debt cycle and of course Governments and those with some capital (and political leverage quite often) get to borrow more than the poorest so therefore their capital asset value accumulates while the poorest, who cannot borrow so easily, lose out. I did point out that QE would benefit the richest and be detrimental for the poorest some time ago but none of the self proclaimed 'progressives' would believe it. Q1 'bad weather' caused - 2.3% 'growth' in the US yet the S&P went up... Less people are working in the US than in 1979 yet the markets go higher as the debt grows. The rich borrow more and hype up asset prices while the poor have been left behind by insane immigration policies driving wages down and grossly distorted real asset and cost of living inflation statistics.

[tantalus]

I work in the field of Emergency Preparedness and I know firsthand that society is often unwilling to invest even relatively modest amounts of resources into preparedness for events that we know will occur at some point in the future. Yet when the inevitable event takes place, massive amounts of resources have to be committed to “fixing” the problem when it could have been prevented altogether for a relative bargain.

A major problem in our economic system and one the market can not solve. This is where the state is required, the same goes for matters such as pollution and the maintenance of ecosystem services in nature, their loss would be colossal economically, their relatively free as long as we manage them and the state is required to insure their protection at a relatively cheap cost, utilizing hindsight provided by scientific expertise, so the economy can continue to reap the benefits in the long run.

Flooding downstream from massive deforestation of floodplains upstream is a nice example which is directly decoupled from the proximate cause of a flood, and the economic benefits accrued from the economic activity that benefited from the deforestation in the first place, something more than the market is required to manage these situations, via the state and the taxes they require to do so.

Something else to consider is that many of the societal changes you have attributed to capitalism can be explained better by the advent of the “green revolution”. In 1870, about 75% of the U.S. population was employed in agriculture. Today less than 2% of the population works in agriculture and manages to keep society very well fed. Any society that undergoes a shift that frees up 73% of their populace to do something other than growing food will experience explosive economic growth and a sharp rise in the standard of living.

That's a good point, but it can be a bit of a chicken/egg argument as capitalism partially facilitates the use of technology to improve efficiency.

The biggest economic change I would like to see in the United States and elsewhere is to have capital gains from investments taxed at the same rate as income from an employer. One of the biggest reasons the very wealthy continue to scoop up disproportionate shares of the total wealth is that they don’t work for a living, instead they make all of their money from investments. When investments are taxed at less than half the rate of income, it is not so surprising that the very rich continue to increase their total share of wealth.

Gotcha. Does anyone have a run down on the disparity, roughly, between the two?

Capitalism may not be perfect. But what is the alternative?

Just to be clear, I am certainly not looking for an alternative, just the best way of managing it.