News The Distribution of Wealth in the US

[turbo]

These are the unfairnesses of life. These things happen with or without a government's intervention. What you, Ivan, turbo, etc. are suggesting is that government should correct these inequities.

You paint with a very broad brush, Russ! I made the comment that a basic level of access to health care would decrease health-care costs to all of us, and you conflate that with socialism/social engineering.

We spend more on health care than any other advanced nation with arguably poorer results than most. You don't want to tax rich people to pay for health care for poor people, but we middle-class people pay higher premiums year in and year out to pay for the health-care of the uninsured. That is an unavoidable tax on the middle-class, and it really strains your argument.

The effect of the cost-shifting to the wealthy by the uninsured is miniscule. It's a "flat tax" that affects the wealthy to no measurable extent and affects the middle class significantly.

 

[Dale]

Everything is done by force in society. ... Force is no argument.

I recognize that society often operates by the use of force and that the use of force can be morally justified in certain circumstances. You have asserted that this is one of them, so make your case.

 

[Dale]

If you start an argument with hard working rich and lazy poor, you start off with a fork.

I already addressed this point. I did not present such a dichotomy as the only possibility (which is the crux of Mortons fork), I explicitly and deliberately allowed for other scenarios.

There are hard working people both among the rich and the poor. There are lazy people both among the rich and the poor. If you believe that it is just and fair to forcibly take money from the lazy rich to give to the hard working poor, then make that case. If you believe that it is just and fair to forcibly take money from the hard working rich to give to the lazy poor, then make that case.

I am only asking you to argue your point, and I am giving you a lot of latitude in picking the code of ethics as well as the premises. All you have to do is make a case, which you have yet to even seriously attempt.

 

[John Creighto]

. What are the rules of justice and fairness by which it becomes morally necessary to forcibly take money earned by one man and give it to another man who has not earned it?.

Here is my argument again keeping the parts I hope are acceptable here:

Did the man justly earn the money or did the man inherit the money.
Did the man earn the money on his own labor or expropriate it on the surplus labor of the worker?
Did the man obtain the money by playing within the rules or was the money obtained by defrauding the people?
Were the scarcities real or artificial created to extract greater rents for profits and services?
Were the rules set up to favor efficient markets or protect the wealth and earnings of those with interest and power.
Was there equal opportunity to obtain success through hard work or did the rules favor those well connected and with resources?

Morality aside, the apparent wealth extolled via the advantage of the wealthy cannot be supported without sufficient demand from the people to justify the market value of the capital. When the worth of the capital capital owned by the wealthy depends on the buying power of the people, it must be recognized that there is a upper limit to the value of that wealth and any attempts to inflate the value of this wealth beyond that point must come to an end.

Historically relevant supporting quotes have been removed supposedly based on the links I gave which contains the original works.

I feel somewhat handicapped in that I seem to be not allowed to give my argument in full because I don't have a "suitable link" to reference my sources.

 

[Dale]

John, you are repeating yourself. I already replied to this:
https://www.physicsforums.com/showpost.php?p=3549082&postcount=45

 

[John Creighto]

John, you are repeating yourself. I already replied to this:
https://www.physicsforums.com/showpost.php?p=3549082&postcount=45

Well, I'm sorry. I didn't get to reading the whole thread until now and only saw my post was taken down and replied on that basis. I don't believe it is proper practice to censor the writings of major historical figures. Therefore unless it can shown that what I posted inaccuracy reflects the original work I don't believe the content should have been taken down.

 

[Dale]

Ah, I didn't notice the deletion at first. In any case I didn't respond to the part with the historical reference. So, my question remains. Under what conditions, if any, do you assert the justice and fairness of the redistribution of wealth? If so, then justify your assertion.

 

[Evo]

Well, I'm sorry. I didn't get to reading the whole thread until now and only saw my post was taken down and replied on that basis. I don't believe it is proper practice to censor the writings of major historical figures. Therefore unless it can shown that what I posted inaccuracy reflects the original work I don't believe the content should have been taken down.

Let's stay on the topic of what is happening in the US now and not wander off into history, there is a history subforum for that if you want to get into a lengthy diatribe.

 

[russ_watters]

Talking about "fairness" when it comes to taxation leads to all kinds of disingenuous debates in which one side talks past the other. What constitutes "fairness" is very much in the eye of the beholder.

To one extreme, the only fair tax is a true flat tax: Billionaires and paupers alike should pay the same amount in taxes (not the same rate, the same amount). The end result of this kind of thinking: Everyone is poor. The infrastructure that advanced governments build and the technicala investments that advanced governments make simply could not be sustained with this kind of "fairness". To another extreme, the only fair tax is one that makes everyone exactly the same. The end result of this kind of thinking: Everyone is poor. Modern society implicitly depends on some people being hungry for power, wealth, fame. Squelch these desires and everyone suffers.

In between these extremes you will see some who claim that a fair tax is one that taxes everyone at the same rate, while others will claim that a tax is fair only if it is progressive. A huge problem with talking about "fairness" is that what constitutes "fairness" is inexorably tied up with politics. Different people have very different concepts of fairness. You can see this conceptual disconnect in action right here in this thread.

Big as this problem is, there is an even bigger problem regarding discussing whether a tax is fair. Taxation, while absolutely essential to society, is also the ultimate in unfair activities. How can one talk about "fairness" when failure to comply means armed people will come and forcibly take your money from you? With the full force of the law behind them?

"Fairness" in taxation is IMHO a silly concept unless we work very hard to define what "fairness" means.

Good point/well put. However, you do somewhat gloss over the position being forwarded here. It isn't just about "the infrastructure that advanced governments build..." My position is based on the idea that unfair taxation is acceptable for the purpose of making the government run because, as you said, there is no other way. That's an indirect wealth transfer as the money goes to government functions. But what has been happening since the New Deal goes beyond that: direct wealth transfers from one group to another. Rather than supporting the functioning of the government, what is being advocated here is that we simply take wealth from one group and give it to another.

So to put it more succinctly: the compromise I'm willing to make is that I will accept a widly uneven taxation scheme as long as the money is going toward the functioning of the government, instead of just being handed to other citizens.

 

[John Creighto]

Most of them earned it, at least in the US (the topic of this thread).

That certainly is the premise of many peoples arguments. We certainly don't get equal pay for equal effort. Therefore we must ask, how "just", are the rules which decides how much we each earn? The secondary arguments is that people should be paid based on what they are worth and that this is efficiently determined by the market. The vary fact that bubbles exist demonstrate that the market is not efficient and these inefficiencies would extend to how we value the worth of an individuals labour. The resume building experience is essentially based on accumulating social status. Well, this status acts somewhat as a proxy for rating peoples skill it is largely based on the opportunities people had which also depends in a large part on luck and connections.

You have a very skewed and very distorted view of the rich. While one can get rich by exploiting those who work for them in an underdeveloped nation, this thread is not about underdeveloped nations. This simply is not the case a modern society such as the US. Steve Jobs, Bill Gates, and Larry Page made the people who work for them very, very wealthy.

When you say the people who work for Steven Jobs, I presume you are not talking about the people in the third world building his products. Additional regardless of the value he creates any share these people take in the market displaces the share someone else takes. Apple charges gigantic rents for artists that sell through i-tunes which essentially subsidizes apples products on the backs of music artists and ap developers.

[/quote]Most obtained their money by playing within the rules. Yes, a few broke the rules. Most of them went to jail. What is your point?[/QUOTE]

This certainly isn't the perception many people have. The fact that there were a huge amount of credit default swaps sold without the necessary real capital to insure these products is essentially fraud.

 

[John Creighto]

Show me where I claimed that everyone in the top 1% was at retirement age? You're putting words in my mouth, which is a very cheap form of debate.

Age can have the largest effect without it being the only effect.

You said the wealthiest people were those who just retired. I thought your implication that the primary wealth inequalities were simply due to people's retirement savings.

 

[russ_watters]

You paint with a very broad brush, Russ! I made the comment that a basic level of access to health care would decrease health-care costs to all of us, and you conflate that with socialism/social engineering.

Just healthcare and because of cost? Perhaps you should go back and reread your own post or just stop being disingenuous about your own beliefs! Your first post said nothing at all about cost, just "...minimum outcome in the case of access to quality healthcare, college education, etc?"

It is tough to have a discussion when you aren't even following your own posts!

 

[John Creighto]

Feel free to posit whatever scenario you are interested in. If you believe that it is just and fair to forcibly take money from someone only under certain circumstances then state those circumstances and argue why you think it is just and fair in those circumstances. If you think it is just and fair in all circumstances then the questions above are not relevant, and you need to prove your point from more general premises.

If you don't care about justice and fairness and just want wealth redistribution regardless of ethical considerations then own up to that fact, and don't paint your arguments with a veneer of morality.

I think a negative income tax and Laissez-faire capitalism is the best way to organize the economy. To obtain this the size of government has to be reduced (albeit slowly) as well as the rules which favor large corporations over small businesses.

As for what I believe in terms of wealth distribution, people should pay based on what they can contribute and clearly wealthy people can pay more. The point of providing scenarios to show that not all accumulation of wealth is just is to counter-balance the claim that all forms of redistribution are unjust.

 

[russ_watters]

I have an idea about the expansion of socialism in democratic countries:

Freedom is a double-edged sword. It carries with it the possibility of great success and spectacular failure. Traditionally, the failure was death. This freedom has enabled the US to grow its economy rapidly, from scratch to become the world's most powerful nation in about 100 years.

But, it is reasonable once a certain level of development is reached, to trade some of the freedom that created economic growth for financial security. We can afford it. It doesn't hurt much to do it. So today, people who otherwise would so fail that they'd starve to death in a ditch are cared for. This is largely a positive thing.

But, in sports, there is a concept called a "prevent defense". It means that when your team gets ahead, you change your strategy to favor defense, and in such a way as to allow small gains, but protect against big ones. The downside of course is that a bunch of small gains can add up to a big gain and often it fails.

The point of the sports analogy is that you should not abandon the strategy that got you ahead in the first place. Make small adjustments. Continue to grow your lead. The human condition in western countries has gotten so rapidly better in the past 100 years, that it defies defintion. Yes, we can afford to give some back. But there is danger in completely changing the strategy that enabled the growth. We could end up (and I think we are) sabbotaging our own success.

 

[Dale]

I think a negative income tax and Laissez-faire capitalism is the best way to organize the economy. To obtain this the size of government has to be reduced (albeit slowly) as well as the rules which favor large corporations over small businesses.

As for what I believe in terms of wealth distribution, people should pay based on what they can contribute and clearly wealthy people can pay more.

Your comments about "best" and "should", are those moral judgements or practical ones? I.e. should they pay more because it is just and fair, or because it is practical and effective despite the injustice and unfairness?

The point of providing scenarios to show that not all accumulation of wealth is just is to counter-balance the claim that all forms of redistribution are unjust.

Nobody made that claim in this thread. (at least not that I noticed)

 

[lisab]

I have an idea about the expansion of socialism in democratic countries:

Freedom is a double-edged sword. It carries with it the possibility of great success and spectacular failure. Traditionally, the failure was death. This freedom has enabled the US to grow its economy rapidly, from scratch to become the world's most powerful nation in about 100 years.

But, it is reasonable once a certain level of development is reached, to trade some of the freedom that created economic growth for financial security. We can afford it. It doesn't hurt much to do it. So today, people who otherwise would so fail that they'd starve to death in a ditch are cared for. This is largely a positive thing.

But, in sports, there is a concept called a "prevent defense". It means that when your team gets ahead, you change your strategy to favor defense, and in such a way as to allow small gains, but protect against big ones. The downside of course is that a bunch of small gains can add up to a big gain and often it fails.

The point of the sports analogy is that you should not abandon the strategy that got you ahead in the first place. Make small adjustments. Continue to grow your lead. The human condition in western countries has gotten so rapidly better in the past 100 years, that it defies defintion. Yes, we can afford to give some back. But there is danger in completely changing the strategy that enabled the growth. We could end up (and I think we are) sabbotaging our own success.

I think you have an interesting point, but is it really true that "often" it fails? Simply by applying market forces to sports tells me that's not so.

 

[TurtleMeister]

I have an idea about the expansion of socialism in democratic countries:

Freedom is a double-edged sword. It carries with it the possibility of great success and spectacular failure. Traditionally, the failure was death. This freedom has enabled the US to grow its economy rapidly, from scratch to become the world's most powerful nation in about 100 years.

But, it is reasonable once a certain level of development is reached, to trade some of the freedom that created economic growth for financial security. We can afford it. It doesn't hurt much to do it. So today, people who otherwise would so fail that they'd starve to death in a ditch are cared for. This is largely a positive thing.

But, in sports, there is a concept called a "prevent defense". It means that when your team gets ahead, you change your strategy to favor defense, and in such a way as to allow small gains, but protect against big ones. The downside of course is that a bunch of small gains can add up to a big gain and often it fails.

The point of the sports analogy is that you should not abandon the strategy that got you ahead in the first place. Make small adjustments. Continue to grow your lead. The human condition in western countries has gotten so rapidly better in the past 100 years, that it defies defintion. Yes, we can afford to give some back. But there is danger in completely changing the strategy that enabled the growth. We could end up (and I think we are) sabbotaging our own success.

I've been trying to think of a way to say what I want to say in this thread. But I will give up now because I cannot possibly do better than this post. I will simply add that I am old enough to have seen a lot of changes in this country and the current trend worries me.

 

[ThomasT]

What is a reasonable distribution of wealth?

This might seem like an unanswerable question. But it also seems that certain criteria (not involving the nebulous idea of fairness) might be posited to evaluate certain taxation and redistribution schemes.

From my point of view, if what we see today is what our system is intended to produce, or if this is the best we can do under our system, then I reject our system.

I don't think the US was founded with the intention of fostering corruption (even though it seems to be as corrupt as any other 'system'), nor with the intention of producing anything even remotely approximating an equal distribution of wealth. There's a lot of corruption and manipulation at the top, and this is what the recent Wall Street protests are about. There are some things that can be done about that corruption, but since the government is also largely corrupt, imo, and primarily concerned with protecting the interests of the wealthy, it isn't likely that any significant changes in the status quo will be forthcoming.

I expect more. I expect a system that leans towards justice and fairness.

These might be unrealistic expectations. It seems that the US's 'founding fathers' were most interested in 1) getting out from under the yoke of England because of the taxes they had to pay, and 2) protecting their property. Characterizing the concepts of justice and fairness (equality of opportunity) as 'inalienable rights' elevated their cause, at least rhetorically. But imo the US wasn't really about that then, and it isn't about that now.

I think most Americans want a system that is fundamentally fair - one that doesn't give an unreasonable advantage to the uber rich.

I think that most Americans, like any people, want more for themselves.

Of course the uber rich have an advantage wrt most everything, but there's nothing unreasonable about that. They have most of the money.

The question, or at least one question, might be: are the uber rich doing things that perpetuate and increase the wealth disparity in the US? The answer, imo, is that of course they are. And this presents certain problems wrt the functioning of the general economy. That is, it's pretty hard to sell things to people who don't have enough money to buy them.

Currently, things are pretty good for virtually all Americans (compared to the general populations in most other countries). But it isn't written in stone that the standard of living that Americans have enjoyed for the past, say, 60 years or so has to continue. Offshoring and outsourcing, immigration both legal and illegal, the expansion of the financial sector, the relative decrease in US manufacturing as a percentage of the economy, and increasingly pervasive influence of multinational corporations on public policy contribute, imo, to the erosion of the 'American Dream'.

What will be done to alter the trend toward increased unemployment, a poorer general population, and a greater disparity in wealth distribution? My guess is not much -- anyway, not enough to significantly alter the trend.

 

[John Creighto]

"Originally Posted by John Creighto
I think a negative income tax and Laissez-faire capitalism is the best way to organize the economy. To obtain this the size of government has to be reduced (albeit slowly) as well as the rules which favor large corporations over small businesses.

As for what I believe in terms of wealth distribution, people should pay based on what they can contribute and clearly wealthy people can pay more."

Your comments about "best" and "should", are those moral judgements or practical ones? I.e. should they pay more because it is just and fair, or because it is practical and effective despite the injustice and unfairness?

In my view people who have more resources have a moral imperative to help those less fortunate and people with more resources clearly can contribute more with less personal pain to those less fortunate.

From a practice standpoint it is much more practical to ask those with more wealth to contribute a large amount of wealth.

"The point of providing scenarios to show that not all accumulation of wealth is just is to counter-balance the claim that all forms of redistribution are unjust.

Nobody made that claim in this thread. (at least not that I noticed)

Then I must either conclude that you think in some circumstances wealth redistribution is just or you are unsure if there are any circumstances where it is just.

The point of the sports analogy is that you should not abandon the strategy that got you ahead in the first place. Make small adjustments. Continue to grow your lead. The human condition in western countries has gotten so rapidly better in the past 100 years, that it defies defintion. Yes, we can afford to give some back. But there is danger in completely changing the strategy that enabled the growth. We could end up (and I think we are) sabbotaging our own success.

I'll agree with you on this point when it is practical to do so but this can be difficult when fundamental change is required. The rate at which we steer a nation towards our desired goals should be balanced against the need for stability.

 

[russ_watters]

I think you have an interesting point, but is it really true that "often" it fails?

I'm not sure there are actually any stats on it - it is mostly anecdotal, but widely believed. But...

Simply by applying market forces to sports tells me that's not so.

Do you mean if it failed more often than it succeeded, "market forces" would make people stop doing it? That's not necessarily true in sports or in economics. In sports, coaches can get blamed more for giving up a big play than a lot of small ones. There is a high school football coach I've heard about somewhere who never punts because he says that statistics show it isn't the "right" thing to do. But he's a rarity: others have said essentially 'I don't care if he's right, I'm still not doing it' (I think I read that in SI...). Similarly, there was a resistance to the economic type analysis of baseball in "Moneyball", and that's a sport where, because of the long season, statistical analysis should be the most accepted.

And, of course, like sports, people sometimes make economic choices more based on ideology than statistics or logic.

And, and, of course, of course, the topic of this thread is an ideology designed to contradict market forces with government intervention. Worse, it is talking about [continuing to] abandoning the most successful economic system the world has ever seen.

 

[MarcoD]

This might seem like an unanswerable question. But it also seems that certain criteria (not involving the nebulous idea of fairness) might be posited to evaluate certain taxation and redistribution schemes.

Currently, things are pretty good for virtually all Americans (compared to the general populations in most other countries). But it isn't written in stone that the standard of living that Americans have enjoyed for the past, say, 60 years or so has to continue. Offshoring and outsourcing, immigration both legal and illegal, the expansion of the financial sector, the relative decrease in US manufacturing as a percentage of the economy, and increasingly pervasive influence of multinational corporations on public policy contribute, imo, to the erosion of the 'American Dream'.

What will be done to alter the trend toward increased unemployment, a poorer general population, and a greater disparity in wealth distribution? My guess is not much -- anyway, not enough to significantly alter the trend.

That's my point. There is an imminent believe in the free-market in the US, in short neoliberalism. Let's look at it:

Neoliberalism promised the disparity between the poor and the rich would diminish. It didn't, I bet the gap never has been so large. It eats away at your economy by making everybody poorer, from the poorest to -now- the middle class.

Neoliberalism stated around the years 2000-2005 that economic bubbles wouldn't occur anymore. The market is always right, and would be too smart to hand out loans to those who can't pay. We ended up with a financial crisis.

Neoliberalism promises more jobs for everyone. In the end, jobs must return from China since the money goes there. What is happening? China provides cheap goods now, an illusion of wealth for the US, but China is on a mercantile route: Every dollar given to them goes directly towards buying resources in the Middle East, Asia, Africa and South-America. Don't kid yourself, not a penny will go to the US until they own the developing and resource producing continents, and then it will be too late.

The free market for the last decade has shown but one thing: that it will briefly provide the illusion of wealth by cashing in on jobs moved to other continents, by cashing in on parts of the population, and by cashing in on the future. It does everything except for solving problems, it pushes human problems away in all directions.

Do you think the system works? The US will continue to cash in on everything, and go bust. There's no doubt in my mind it will happen.

 

[Dale]

In my view people who have more resources have a moral imperative to help those less fortunate

Ok, so you clearly believe that the rich have a presonal moral obligation to provide charity. That seems to indicate that they should voluntarily donate to charitable causes they choose at the times and in the amounts that they see fit to contribute. I think the morality of personal private charity is undisputed.

However, that is not what I am interested in here, I am interested in the morality of forcibly seizing their wealth to donate to causes not of their choosing at times and in amounts that they did not see fit to contribute. Do you claim that it is just and fair? If so, defend the claim, if not, then admit that it is not about justice and fairness.

 

[Lapidus]

I think this is an interesting question, and I have a follow-up question of my own: What are the rules of justice and fairness by which it becomes morally necessary to forcibly take money earned by one man and give it to another man who has not earned it?

For example, in what way is it just or fair to take money from someone who is hard working and rich and give it to someone who is lazy and poor? Or, in what way is it just or fair to take money from someone who is hard working in a economically valuable role (like Steve Jobs) and give it to someone who is hard working in a less economically valuable role (like a mediocre poet)?

What principle of justice and fairness requires the same outcome for different efforts?

If A works hard and creates wealth, and B works less hard and creates less wealth than A, but B has more income than A.

Also, some people are born richer, are more intelligent, have more talents, are healthier or had simply more luck in their lifes than others.

Or, let's imagine everybody would work equally hard and were equally clever, but the work available in the economy and the incomes it generates would be very different.

And last but not least picture a economy where lots of income does not come from work but from capital...

All morally arguments for taxing differnt incomes differently and helping the capitalist market economy, which is great at production and allocation, but often not so good in distribution, to be more fair.

Of course, the much stronger arguments are economic arguments, which has been addressed already somewhat in the thread.

 

[ThomasT]

@ MarcoD,

The OP's main point was:

I think most Americans want a system that is fundamentally fair - one that doesn't give an unreasonable advantage to the uber rich.

I'm not even sure what "fundamentally fair" might mean. I can envision a system that's fundamentally fair (in the sense that I think Ivan means it) in many, maybe even most, ways, but that still gives an inordinate advantage to the rich. What seems more or less certain to me is that the uber rich have a great advantage in any system -- and that that advantage isn't unreasonable (although it might be deemed largely unfair depending on the extent to which the uber rich use their wealth to manipulate things in their favor).

The US seems to me to be a pretty 'fair' place to live. But there isn't enough buying power in the general population to support the scale of small business creation or big business expansion that might increase that buying power, and that buying power is decreasing slowly but steadily, defining a trend of unforseeable duration.

You've brought up a number of debatable points regarding neoliberalism. You might open a new thread (or threads) to discuss some of those points, as they seem a bit off topic for this thread. Wikipedia has an article on neoliberalism that can be referred to for definitions, etc.

 

[MarcoD]

@ MarcoD,

The OP's main point was:

I'm not even sure what "fundamentally fair" might mean. I can envision a system that's fundamentally fair (in the sense that I think Ivan means it) in many, maybe even most, ways, but that still gives an inordinate advantage to the rich. What seems more or less certain to me is that the uber rich have a great advantage in any system -- and that that advantage isn't unreasonable (although it might be deemed largely unfair depending on the extent to which the uber rich use their wealth to manipulate things in their favor).

The US seems to me to be a pretty 'fair' place to live. But there isn't enough buying power in the general population to support the scale of small business creation or big business expansion that might increase that buying power, and that buying power is decreasing slowly but steadily, defining a trend of unforseeable duration.

You've brought up a number of debatable points regarding neoliberalism. You might open a new thread (or threads) to discuss some of those points, as they seem a bit off topic for this thread. Wikipedia has an article on neoliberalism that can be referred to for definitions, etc.

I agree with you. To me fundamentally fair would imply some system where the wealth of the rich is eroded in about three to four generations. (You want people to be able to work hard and amass wealth, and give it to their children, but not at infinitum.)

But as Russ stated, that is a belief that people are born equally, and therefor the playing field from the point they are born should be equal. If you don't share that belief, the discussion ends.

 

[Dale]

If A works hard and creates wealth, and B works less hard and creates less wealth than A, but B has more income than A.

You have an "if" statement with no "then".

Also, some people are born richer, are more intelligent, have more talents, are healthier or had simply more luck in their lifes than others.

OK, so you reject the premise that all men are born equal.

Or, let's imagine everybody would work equally hard and were equally clever, but the work available in the economy and the incomes it generates would be very different.

And last but not least picture a economy where lots of income does not come from work but from capital...

OK, you are postulating some specific premises.

All morally arguments for taxing differnt incomes differently

None of them are even arguments, let alone moral arguments. I recommend that you read the Tutorial on Argument and Fallacy so that you can understand what constitutes an argument:
https://www.physicsforums.com/showthread.php?t=154924

 

[ThomasT]

I agree with you. To me fundamentally fair would imply some system where the wealth of the rich is eroded in about three to four generations. (You want people to be able to work hard and amass wealth, and give it to their children, but not at infinitum.)

I don't think I agree with this. Even in a fundamentally fair system great wealth is going to confer great advantage. I don't see any necessity for the erosion of wealth. It's just that a fundamentally fair system would block the wealthy from unduly exploiting the system detrimentally -- so that the trend is that everybody gets a little bit wealthier (which is the way it was in the US for a while), rather than a small percentage getting a lot wealthier while the vast majority get poorer.

But as Russ stated, that is a belief that people are born equally, and therefor the playing field from the point they are born should be equal. If you don't share that belief, the discussion ends.

Why would the discussion then end? It seems pretty evident to me that people aren't born equally, and aren't equal either in terms of their personal physical/mental capabilities or in terms of being financially able to maximize those capabilities.

So the federal government has historically stepped into help less advantaged people augment their situations and maximize their potential, along with minimizing the negative effects resulting from the greed of corporations. A big part of the problem contributing to the downward trend of the US, imo, is that the federal government isn't doing enough wrt the latter.

 

[Dale]

To me fundamentally fair would imply some system where the wealth of the rich is eroded in about three to four generations.

Wow! That is a very specific claim. Can you show how "fundamentally fair" logically implies "wealth of the rich is eroded in about three to four generations"?

 

[D H]

Also, some people are born richer, are more intelligent, have more talents, are healthier or had simply more luck in their lifes than others.

OK, so you reject the premise that all men are born equal.

DO NOT put words in other people's mouths, Dale. This thread is on shaky enough ground as is.

A big problem with this thread, and with others like it, is that people bandy about emotionally laden terms such as equality, fairness, and justice without any definition of those terms. These kinds of discussions are hard enough when the terms are well defined. The discussions become little more than emotional rants when these key terms are loosely defined or are not defined at all. Shoot, one might as well try to nail jello to a tree.

 

[WhoWee]

We had another thread addressing this issue and it was locked due to some problem with one source linked. What is a reasonable distribution of wealth? From my point of view, if what we see today is what our system is intended to produce, or if this is the best we can do under our system, then I reject our system. I expect more. I expect a system that leans towards justice and fairness. But I don't think the results are the ideal that we strive to achieve. I think most Americans want a system that is fundamentally fair - one that doesn't give an unreasonable advantage to the uber rich. http://sociology.ucsc.edu/whorulesamerica/power/wealth.html

Well done Ivan - 4 pages and 79 responses to your single post - you are the Master!

Perhaps it would be helpful to put a face on the "uber-rich"?

Warren Buffet?
Bill Gates?

How about (after mourning him last week) Steve Jobs (it was reported Apple has more cash than the US)?

What do we want to DO to these people - in the context of creating "a system that leans towards justice and fairness"? What do these people owe the people marching through the streets of America demanding change?

http://www.forbes.com/forbes-400/list/
These are the faces of the uber-rich - the first hedgefund person (George Soros) is in position number 7 and the second is in position 17 and Carl Icahn is number 25 - the rest of the top 25 are entrepreneurs or their families.

 

[arildno]

But as Russ stated, that is a belief that people are born equally, and therefor the playing field from the point they are born should be equal.

Equal in what sense?

I certainly support that the murder of a week old infant of a desperately poor family should be as strongly punished as the murder of the week old infant of a super rich family.

Thus, SOME compensatory redistribution MUST be accepted, namely such level of redistribution that ensures that poor families DARE, and can afford, to bring complaint of rights violations to the authorities.

 

[MarcoD]

Equal in what sense?

Well, a great deal more equal than what you propose. Equality of opportunity, freedom, outcome, everything. Not to the point that that becomes oppression, but that's about it.

 

[arildno]

Well, a great deal more equal than what you propose. Equality of opportunity, freedom, outcome, everything. Not to the point that that becomes oppression, but that's about it.

Why do people have a right for "equality to everything"?

 

[MarcoD]

Why do people have a right for "equality to everything"?

Because they do. What else? [ I already told you we're discussing beliefs. There is no why. ]

 

[daveb]

Talking about "fairness" when it comes to taxation leads to all kinds of disingenuous debates in which one side talks past the other. What constitutes "fairness" is very much in the eye of the beholder.

To one extreme, the only fair tax is a true flat tax: Billionaires and paupers alike should pay the same amount in taxes (not the same rate, the same amount). The end result of this kind of thinking: Everyone is poor. The infrastructure that advanced governments build and the technicala investments that advanced governments make simply could not be sustained with this kind of "fairness". To another extreme, the only fair tax is one that makes everyone exactly the same. The end result of this kind of thinking: Everyone is poor. Modern society implicitly depends on some people being hungry for power, wealth, fame. Squelch these desires and everyone suffers.

In between these extremes you will see some who claim that a fair tax is one that taxes everyone at the same rate, while others will claim that a tax is fair only if it is progressive. A huge problem with talking about "fairness" is that what constitutes "fairness" is inexorably tied up with politics. Different people have very different concepts of fairness. You can see this conceptual disconnect in action right here in this thread.

Big as this problem is, there is an even bigger problem regarding discussing whether a tax is fair. Taxation, while absolutely essential to society, is also the ultimate in unfair activities. How can one talk about "fairness" when failure to comply means armed people will come and forcibly take your money from you? With the full force of the law behind them?

"Fairness" in taxation is IMHO a silly concept unless we work very hard to define what "fairness" means.

OUTSTANDING assessment! That's why I've decided to simply stay out of most of these types of discussions in the future, other than to "throw in my two cents" as it were.

 

[russ_watters]

In my view people who have more resources have a moral imperative to help those less fortunate and people with more resources clearly can contribute more with less personal pain to those less fortunate.

From a practice standpoint it is much more practical to ask those with more wealth to contribute a large amount of wealth.


Then I must either conclude that you think in some circumstances wealth redistribution is just or you are unsure if there are any circumstances where it is just.



I'll agree with you on this point when it is practical to do so but this can be difficult when fundamental change is required. The rate at which we steer a nation towards our desired goals should be balanced against the need for stability.

Well thanks, but you didn't really agree with that much of what I said: I was arguing specifically against both the need and wisdom of "fundamental change".

When economic downturns happen, some people will have the knee-jerk reaction that it means the system requires "fundamental change". It doesn't. The economy is cylical and downturns happen. Some are worse than others, and this one is pretty bad. And while it has some specific causes, most do and those particular causes (credit default swaps, unreasonably low interest rates, poorly-conceived lending rules) can be fixed without dynamiting the entire system. People just need to relax a little and focus on the real problems.

Now while I argued that a sufficiently advanced economy can afford to take a little off the top to help those at the bottom, the middle of a downturn is precisely the WORST time for such change, as the economy is less able to withstand a reduction in growth in bad times than in good times. Unfortunately, though, major changes require political capital and political capital is at its greatest during hard times. This is why hard times are dangerous, and we've seen examples throughout history of countries failing because when times got tough they made ill-conceived, fundamental changes.

At the same time, this thread is focused on one particular symptom as evidence that the system needs "fundamental change", when the symptom isn't even relevant to the supposed disease. None of what ails us now as a result of the recession is caused by an uneven wealth distribution. In fact, the OP's link shows that the wealth of the uber-rich grew substantially in the early to mid-90s, then crashed in 2000 with the stock market, then started back up again a couple of years later. The 90's, being the liberal heyday, this shows clearly that liberals are interpreting the data backwards: The vast growth in upper level incomes in the 90's, due to stock market growth and the internet boom caused spectatularly low unemployment and budget surplusses due to more capital gains income from the upper level earners and less welfare/unemployment payouts to the lower level earners.

That is -- if income inequality is the symptom and not the disease. Liberals fall victim (partially due to politicians pounding it into them) to the idea that wealth is a zero sum game and 'the rich get richer while the poor get poorer', so wealth inequality is a measure of poverty. That's false. Income inequality certainly has risen in the past 20 or 30 years, but poverty? Nope. So the income inequality issue really is either a misunderstanding of what inequality means or is jealousy over how much faster the rich are getting richer than the poor: The rich are too rich, so we must take their wealth. Sorry, but that's no way to run an economy. Certainly no reason to scuttle the system we have.

 

[russ_watters]

I said in an earlier post that poverty in the west, defies definition. Let me expand: We have it so good that the scaricity of needs the rest of the world uses to define poverty -- food, shelter, water, sanitation, electricity, clothing, primary eductation -- simply don't exist in the west. We're at the point where - with a straight face - we define "poor" as window air conditioning instead of central air, a mediocre computer, lack of HDTV and one car per family instead of two or three. It's a joke. I drive through the poorest city in my state on the way to work. I drive past rows and rows of run-down townhouses and see satellite dishes. Lots of them. This is a level of "poverty" worthy of blowing up our system? C'mon - that's not evidence of failure, that's evidence of spectacular success!

 

[D H]

Because they do. What else? [ I already told you we're discussing beliefs. There is no why. ]

While you are entitled to your own beliefs, you are not entitled to your own facts.

The fact is that such a belief system has never worked except in one regard. It arguably did succeed in creating the most brutal, most inhumane form of government ever created by mankind. In all other regards this belief system is one of the worst mistakes of the 20th century. All that this belief system accomplished economically was to make everyone equally poor. "I pretend to work and they pretend to pay me" was a sad joke that characterized this horrendous form of government. The countries that used to employ this silly belief system have all abandoned it to one degree or another, and when they did so those countries started seeing an improved quality of life for everyone.

 

[russ_watters]

Because they do. What else? [ I already told you we're discussing beliefs. There is no why. ]

Well, I do appreciate the honesty, but I believe these issues are too important to trust to belief. History is littered with failed ideas, where belief was followed instead of logic.

 

[Dale]

DO NOT put words in other people's mouths, Dale.

Sorry about that Lapidus and D H. I had not intended to misrepresent Lapidus' position. Instead of asserting his position on a related premise I should have restricted myself to pointing out that Lapidus was stating a premise, not an argument.

 

[arildno]

Because they do. What else? [ I already told you we're discussing beliefs. There is no why. ]

The goal of equality should be restricted to some subset of those areas where it could rationally be expected to be successfully implemented.

 

[Dale]

Because they do. What else? [ I already told you we're discussing beliefs. There is no why. ]

Such beliefs (beliefs without a "why") are known as irrational beliefs. An irrational belief is not a particularly compelling basis for accepting a conclusion.

 

[D H]

Also, some people are born richer, are more intelligent, have more talents, are healthier or had simply more luck in their lifes than others.

That's the way of the world. "All men are created equal" does not mean that everyone is the same; obviously we are not. I cannot throw a baseball 99 mph, so I can't negotiate a contract that pays me several thousand dollars per pitch. What "all men are created equal" means is that we all must be treated equally before the law. It does not mean that we men must all be made equal, by force if needed. That is the way to the world of Harrison Bergeron, the short story by Kurt Vonnegut that russ watters referenced in post #43.

Or, let's imagine everybody would work equally hard and were equally clever ...

And how are you going to achieve this outcome?

Some people are workaholics; they just aren't happy if they put in less than a 50 hour week. Others work 40 hours but manage to always produce what others take 60 hours to accomplish. Yet others put in a 40 hour week because they have to, but the employer is lucky if to get 20 hours of work out of such people. How are you going to address these disparities?

Some people are more clever than others, stronger than others, more coordinated than others, better with people than others. Sans a Harrison Bergeron type solution, how are you going to remedy these inequalities?

How are you going to deal with the perpetually lucky? Should I get to the airport 15 minutes before the flight the response will be "Harrumph. We just gave your seat to someone else; you'll have to wait for the next flight." My perpetually lucky son does that and the response is "Hmmm. We just gave your seat to someone else; we'll have to give you a seat in first class."

 

[FlexGunship]

I said in an earlier post that poverty in the west, defies definition. Let me expand: We have it so good that scaricity of needs the rest of the world uses to define poverty -- food, shelter, water, sanitation, electricity, clothing, primary eductation -- simply don't exist in the west. We're at the point where - with a straight face - we define "poor" as window air conditioning instead of central air, a mediocre computer, lack of HDTV and one car per family instead of two or three. It's a joke. I drive through the poorest city in my state on the way to work. I drive past rows and rows of run-down townhouses and see satellite dishes. Lots of them. This is a level of "poverty" worthy of blowing up our system? C'mon - that's not evidence of failure, that's evidence of spectacular success!

That's the way of the world. "All men are created equal" does not mean that everyone is the same; obviously we are not. I cannot throw a baseball 99 mph, so I can't negotiate a contract that pays me several thousand dollars per pitch. What "all men are created equal" means is that we all must be treated equally before the law. It does not mean that we men must all be made equal, by force if needed. That is the way to the world of Harrison Bergeron, the short story by Kurt Vonnegut that russ watters referenced in post #43.

Just pausing a moment to cheer you on!

 

[Dale]

This is a level of "poverty" worthy of blowing up our system? C'mon - that's not evidence of failure, that's evidence of spectacular success!

Another indication of the fantastic economic success of our system is the fact that the number 1 health concern of our "poor" is obesity. At no other point in history has a society been so wealthy that even the "poor" were still able to acquire enough food to become obese.

 

[D H]

Another indication of the fantastic economic success of our system is the fact that the number 1 health concern of our "poor" is obesity. At no other point in history has a society been so wealthy that even the "poor" were still able to acquire enough food to become obese.

That is a bit disingenuous. Just because the developed world has pretty much eliminating starvation does not mean that the developed worlds have solved the food problem. One key reason that the poor in developed nations have a much higher tendency to obesity is because a low-quality, fat-inducing diet is much cheaper than is a high quality diet. The poor in the US can eat, but not well. Eating well is a luxury that the poor cannot afford.

 

[FlexGunship]

That is a bit disingenuous. Just because the developed world has pretty much eliminating starvation does not mean that the developed worlds have solved the food problem. One key reason that the poor in developed nations have a much higher tendency to obesity is because a low-quality, fat-inducing diet is much cheaper than is a high quality diet. The poor in the US can eat, but not well. Eating well is a luxury that the poor cannot afford.

I'm not sure about every demographic, but in my neighborhood feeding a family on frozen spinach ($1.19), fresh corn ($0.33 per ear), a can of beans ($1.69), and some boneless chicken ($1.99/lb) is STILL cheaper than trying to feed a family from McDonald's.

Blaming obesity on the cost of food seems disingenuous. Perhaps you could argue that it's more difficult to get and and takes longer to prepare but that's really just blaming the obese for their obesity (something you are trying to avoid).

Besides, I don't know of any research that says that weight gain is linked to anything other than excessive calorie intake. There are lots of fancy diets and nutritional plans, but if you eat fewer calories than you use, you will lose weight.

 

[Dale]

That is a bit disingenuous. Just because the developed world has pretty much eliminating starvation does not mean that the developed worlds have solved the food problem. One key reason that the poor in developed nations have a much higher tendency to obesity is because a low-quality, fat-inducing diet is much cheaper than is a high quality diet. The poor in the US can eat, but not well. Eating well is a luxury that the poor cannot afford.

It is not disingenuous at all. The poor can eat. In earlier times the chief health concern of the poor was starvation. That is an economic success!

 

[arildno]

That is a bit disingenuous. Just because the developed world has pretty much eliminating starvation does not mean that the developed worlds have solved the food problem. One key reason that the poor in developed nations have a much higher tendency to obesity is because a low-quality, fat-inducing diet is much cheaper than is a high quality diet. The poor in the US can eat, but not well. Eating well is a luxury that the poor cannot afford.

This is SO untrue!

Buying raw materials for bread, for example, baking it for yourself, and similarly for lots of other food stuffs are STILL much less expensive than going to McDonald's.

The critical factor is that the food at McDonald's is READY-MADE, and is abundantly cheaper than other types of ready-made food deliverers.

 

[mheslep]

... If all US citizens get access to decent preventive health care, costs for all of us insured people should drop, and the incidence of emergency-room use should drop as well - the most expensive medical care in the system.

Turns out that no it doesn't. While guaranteed preventative health care would reduce instances of catastrophic illness, the cost of the X additional preventative treatments is still greater than the cost of the Y fewer treatments of catastrophic illness.