The Distribution of Wealth in the US

[OmCheeto]

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.

Hi DH,

Glad to see I didn't pop your blood vessel in that other thread.

Anyways, "Fair", is my new "F" word.

Randa Duncan Williams inherited 9 billion dollars a while back. Tax free. According to the latest letter from the social security admin, she made 12,000 times more during her fathers last breath, than I did(gross! WORKING! FULL FAIRING TIME!) over the last 36 years.

Fair the flat tax.

 

[edward]

Propaganda, not science.

He asserts that class is the major factor here. It's not - you can see from census and BLS reports that what matters most is age. The wealthiest people are those who have either just retired or are just about to retire. Ignoring that is just bad science.

Perhaps his conclusion is right, but his argument is lousy.

There are a lot of younger very rich people. Being Rich isn't just for grandpa anymore.

http://video.cnbc.com/gallery/?video=1157133460

 

[John Creighto]

Trillion dude. Not billion. Now try again.

hopefully fixed now.

 

[Vanadium 50]

Well, we should be able to easily test your claim .

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.

 

[arildno]

Why, Ms Hilton needs a good reason to get off her pretty ***, and Mr Bugger could be helped with equal opportunities (which includes a safe environment, good housing, and the time to invest in itself.) And Mr Jobs never needed a good incentive to keep working, would end up massively wealthy in any case, and the worst Joe Sixpack is going to do is stimulate the beer industry.

Why should Mr. Bugger be helped by anyone?

His equal worth is a legal term, meaning for example:
1) His vote weighs the same as anyone else's in elections.
2) His testimony in court is not to be given different weight from other weights due to factors like income, religious belief, race.
3) Offenses against him shall not be judged differently by the mentioned parameters.
4) Similarly with punishment of him for offenses done by him.He has no "equal deserving" of as good a life as Ms. Hilton has.

 

[D H]

Did the man justly earn the money or did the man inherit the money.

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

Did the man earn the money on his own labor or expropriate it on the surplus labor of the worker?

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.

Did the man obtain the money by playing within the rules or was the money obtained by defrauding the people?

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?

 

[Dale]

Why, Ms Hilton needs a good reason to get off her pretty ***, and Mr Bugger could be helped with equal opportunities (which includes a safe environment, good housing, and the time to invest in itself.) And Mr Jobs never needed a good incentive to keep working, would end up massively wealthy in any case, and the worst Joe Sixpack is going to do is stimulate the beer industry.

None of this seems relevant to the topic of fairness or justice. I think it is clear that Ms Hilton needs to get off her ***. I do not doubt that Mr Bugger could be helped. But how does that imply that taking her money and giving it to Mr Bugger is just?

Similarly, Mr Jobs did indeed have a good work ethic, and Mr Sixpack is harmless. But how does that imply that taking money from one is fair?

You are very good at positing interesting premises, but not very good at logically connecting them to your conclusions. It is probably not your fault, people are not generally well instructed in reasoning about moral and ethical questions. It is not fundamentally different from deductive reasoning in other fields. You start with a set of axioms, the code of ethics that defines things like justice or fairness, and a set of premises, the situation, and you apply the axioms to the premises in a logical manner to derive the conclusion.

Here you have suggested one axiom: people are born equal (I don't think it is a good axiom, but for the sake of understanding let's go with it). You have several premises (Hilton's ***, Bugger's help, Jobs' work ethic, Sixpack's harmlessness). You have a conclusion (taking money from Hilton and Jobs by force and giving it to Bugger and Sixpack is just and fair). What you lack is the logical connection from the premis to the conclusion via the axioms.

 

[russ_watters]

Because Paris Hilton and some poor bugger in a suburb were born equally?

Ugh. I just explained what the quote from the Declaration meant and you post this?!? C'mon. Please try harder.

That Paris Hilton was born into wealth and none of the rest of us were is unfair. Sure. That Michael Vick was born with unbelievable athletic talent and I wasn't is unfair. That some people get cancer and others don't is unfair.

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.

I read a short story about this thread 30 years ago. It went like this: A government was created to enforce complete equality. In order to correct for physical differences such as intelligence and physical strength, everyone took aptitude tests and corrections were made: Each person was assigned a set of handicaps:

-A mask to obscure good looks.
-A weight belt to inhibit excessive physical strength.
-A headset with a noisemaker that made a loud beep at a set volume and interval to cut off an above baseline thought proces.

It sounds extreme and inhumane, but in today's world and in this thread, we're doing something similar: instead of inhibiting the inborn qualities, we're confiscating the results.

 

[MarcoD]

You have a very skewed view of the rich. Instead of focusing on the Paris Hiltons, I suggest you look to the Steve Jobs of the world.

Paris Hilton got her minute of fame into this argument since we started off with a Morton's Fork. Steve Job got another minute of fame since he, by any normal means of counting wealth, can't be said to be any bit less wealthy if you would reduce his belongings by an order.

Sure Jobs made people rich. The question is whether your country would be richer, the individuals don't count.

 

[Dale]

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?

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.

 

[MarcoD]

Ugh. I just explained what the quote from the Declaration meant and you post this?!? C'mon. Please try harder.

That Paris Hilton was born into wealth and none of the rest of us were is unfair. Sure. That Michael Vick was born with unbelievable athletic talent and I wasn't is unfair. That some people get cancer and others don't is unfair.

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.

I read a short story about this thread 30 years ago. It went like this: A government was created to enforce complete equality. In order to correct for physical differences such as intelligence and physical strength, everyone took aptitude tests and corrections were made: Each person was assigned a set of handicaps:

-A mask to obscure good looks.
-A weight belt to inhibit excessive physical strength.
-A headset with a noisemaker that made a loud beep at a set volume and interval to cut off an above baseline thought proces.

It sounds extreme and inhumane, but in today's world and in this thread, we're doing something similar: instead of inhibiting the inborn qualities, we're confiscating the results.

Wow, and yet another fork. Did I ever claim that one should strive for complete equality? Of course not.

And the reduction of unfairness to a natural order is another falsity. Nature has no ethics; by definition, everything happening is an expression of nature, and is natural. Therefore, communism is natural too, it's just a thing happening. I can argue anything by nature: Women should still be at home and gay men should just be hung from a tree. Nature is a non-argument.

 

[gravenewworld]

http://www.theatlantic.com/magazine/archive/2011/09/can-the-middle-class-be-saved/8600/

IN OCTOBER 2005, three Citigroup analysts released a report describing the pattern of growth in the U.S. economy. To really understand the future of the economy and the stock market, they wrote, you first needed to recognize that there was “no such animal as the U.S. consumer,” and that concepts such as “average” consumer debt and “average” consumer spending were highly misleading.

In fact, they said, America was composed of two distinct groups: the rich and the rest. And for the purposes of investment decisions, the second group didn’t matter; tracking its spending habits or worrying over its savings rate was a waste of time. All the action in the American economy was at the top: the richest 1 percent of households earned as much each year as the bottom 60 percent put together; they possessed as much wealth as the bottom 90 percent; and with each passing year, a greater share of the nation’s treasure was flowing through their hands and into their pockets. It was this segment of the population, almost exclusively, that held the key to future growth and future returns. The analysts, Ajay Kapur, Niall Macleod, and Narendra Singh, had coined a term for this state of affairs: plutonomy.

If you think that the income gap in this country isn't a problem, think again. History is littered with revolution after revolution when the poor rise up against a plutocracy and demand a more level playing field. We are on the verge of it happening again.

 

[MarcoD]

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.

So you don't pay taxes at the moment? Everything is done by force in society. You need to pay in a shop, you need to abide to the law, you even need to dress appropriately. If you don't do any of these things, people ultimately will show up with guns.

If you don't accept the force of society, you need to go and live under a rock. Force is no argument.

 

[D H]

Paris Hilton got her minute of fame into this argument since we started off with a Morton's Fork.

Baloney. There was no Morton's Fork in DaleSpam's post. He merely challenged you to justify the forcible taking that is inherent in taxation. It isn't hard to do so, and there is no need for an unwarranted charge of using a fallacy in making the case for taxation.

Steve Job got another minute of fame since he, by any normal means of counting wealth, can't be said to be any bit less wealthy if you would reduce his belongings by an order.

Now that is a logical fallacy. It is in fact a bald assertion. Make your case.

 

[MarcoD]

Baloney. There was no Morton's Fork in DaleSpam's post. He merely challenged you to justify the forcible taking that is inherent in taxation. It isn't hard to do so, and there is no need for an unwarranted charge of using a fallacy in making the case for taxation.

If you start an argument with hard working rich and lazy poor, you start off with a fork. No question about it.

Now that is a logical fallacy. It is in fact a bald assertion. Make your case.

There is no fallacy. It is belief that above a point of wealth, one can't make a human dignified distinction anymore. Twice infinity is infinity.

 

[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.