[mattyb]

From here : BBC News - Newsnight - Wealth gap widens between super rich and rest

This is the quote that really shocked me :

This winner-take-all phenomenon has been particularly stark in the US, where, between 2002 and 2007, 65% of all income growth went to the top 1% of the population.

Now, I don't mean to get into a right/left argument, nor am I picking on the US, since this is happening in other countries. My issue is this : is this phenomenon one of the side-effects of enjoying freedom, and democracy? There are those that will say it doesn't matter, but my view is that it does matter, and I think that its a 'problem' that need to be solved. And no, just taxing the rich doesn't work, but tbh, I wouldn't have a clue how to ensure how more of this growth could be spread around.

What say ye?

[Laminar]

Originally Posted by mattyb 

I wouldn't have a clue how to ensure how more of this growth could be spread around.

Why is this important?

[Doofy]

Originally Posted by mattyb 

And no, just taxing the rich doesn't work, but tbh, I wouldn't have a clue how to ensure how more of this growth could be spread around.

What say ye?

You can do it in one of two ways.

1) Ban the poor from watching X-Factor.
or
2) Force the rich to watch X-Factor.

It's obviously really, isn't it? If group A is sitting on their sofas watching shite while group B is improving themselves, group B is going to grow their wealth/knowledge more than A.

[imitchellg5]

Capitalism relies on a gap between rich and poor to survive. That bubble continues to expand, pushing the rich upward and keeping the poor poor.

[Doofy]

Originally Posted by imitchellg5 

That bubble continues to expand, pushing the rich upward and keeping the poor poor.

You'll note in that article, if it's the same one I read earlier, that it mentions the rich forming a supra-national peer group.
This is another difference between rich and poor: The rich look after their own and work their lives in such a way as to benefit themselves. The poor... ...well, they all go mental on Internet forums when the merest hint that their country may not be all it's cracked up to be shows up.

In essence, the rich give a toss about things which will make them richer. The poor give a toss about things which are irrelevant to making them richer. Thus, it's actually the poor who keep themselves poor.

Standard sayings in the UK when someone thinks you're going to get rich:
"You'll be too good for us then, won't you?"
"Will you remember us when you're rich?"

To which the correct answers are:
"Yes"
"No, I'll be too busy looking at naked chicks on Pampelonne beach".

[Shaddim]

There really isn't a fix, unless you remove all forms of trade and go to a purely communist system. Why? Because you can redistribute wealth all you want, forcefully take it away from those who have it and give to those who don't, but it will migrate back to the same people every single time because they know how to build it and keep it. Some people are sieves and some are cups, it's an undeniable fact.

[Big Mac]

Originally Posted by imitchellg5 

Capitalism relies on a gap between rich and poor to survive. That bubble continues to expand, pushing the rich upward and keeping the poor poor.

Who exactly taught you that concept, and why do you believe it?

I really question the jealousy of the rich in society today. The richest men in the world today only have a fraction of the relative wealth that was enjoyed by the tycoons of the past like Rockefeller or Vanderbilt, but people act like amassing high amounts of wealth is a new and dangerous phenomenon.

[imitchellg5]

Nobody taught me this, it's just something I've noticed. I work with some people who have up to four jobs, yet they are all making Colorado's low minimum wage, supporting a couple of kids, etc. They'll never move in an upwards direction, yet someone has to be reaping the benefits of their work, right? So it has to be the corporate world that is able to float itself off of this kind of dedication.

[olePigeon]

I would just like to see a flat income tax on all forms of income. Not tax dodging.

[Big Mac]

Originally Posted by imitchellg5 

Nobody taught me this, it's just something I've noticed. I work with some people who have up to four jobs, yet they are all making Colorado's low minimum wage, supporting a couple of kids, etc. They'll never move in an upwards direction, yet someone has to be reaping the benefits of their work, right? So it has to be the corporate world that is able to float itself off of this kind of dedication.

Your anecdote does not prove the validity of your statement about capitalism. Your anecdote speaks more to particular adverse circumstances and poor choices made by individuals than it does economic exploitation.

Are there factors of inequality in capitalism? Certainly. Is it anything close to a perfect system of distribution and reward based on merit? No, not even close. But free enterprise is the best economic system humanity has at its disposal, and it does more to spread prosperity than any competing economic model.

[nonhuman]

Originally Posted by imitchellg5 

Nobody taught me this, it's just something I've noticed. I work with some people who have up to four jobs, yet they are all making Colorado's low minimum wage, supporting a couple of kids, etc. They'll never move in an upwards direction, yet someone has to be reaping the benefits of their work, right? So it has to be the corporate world that is able to float itself off of this kind of dedication.

Maybe they shouldn't have chosen to have kids yet and instead used that reduced cost of living to leverage themselves into a more stable financial bracket.

[mattyb]

Originally Posted by Big Mac 

Who exactly taught you that concept, and why do you believe it?

I really question the jealousy of the rich in society today. The richest men in the world today only have a fraction of the relative wealth that was enjoyed by the tycoons of the past like Rockefeller or Vanderbilt, but people act like amassing high amounts of wealth is a new and dangerous phenomenon.

IIRC, this isn't true. I think that the comparison was between Bill Gates and Rockefeller and that in terms of a country's wealth Bill Gates had lots more than Rockefeller.

BigMac, some would say that communism does more to spread prosperity than free enterprise. Yes, one could say equal misery, but that could be said to be 'more equal'.

I've said it before in other threads, when I started working there was a matra about the customer being always right. This has now changed to something like 'what would the shareholders want'. While I'm not advocating forgetting about shareholders completely, I feel that a company that treats its customers well, doesn't have to think about its shareholders. Like Apple for example.

And I'm not persuaded that just because you are rich, it means that you and only you work hard. I know plenty of hard working people who have miserable salaries yet keep on giving their all to the company that they work for.

[mattyb]

This is what I was trying to explain in my post above.

A more meaningful way of looking at each man's wealth in the context of his times would be to have compared the personal wealth of each prospective member of the 100 with, say, the average wealth of the rest of us. Here is an alternative quick-and-dirty analysis of Rockefeller and Gates. Consider the increase of Gates' fortune just this past year: The $18 billion works out to $49.5 million a day, seven days a week, or $2.1 million per hour, 24 hours a day, $35,000 per minute, or $583 a second. These are terms that anyone will recognize as a mite larger than the numbers on one's own pay stub. Now let's calculate a new ratio: average annual income in the populace to the increase in the rich one's net worth in one year. Take Gates this past year and Rockefeller in 1892, compare each with his contemporaries, and it turns out that the gap between Mr. Wealthy and Mr. and Ms. Average is 311 times as great in the Age of Gates as it was in the Age of Rockefeller. In other words, your instincts were correct. Even in historical context, Bill Gates is the richest American who ever lived.

From here : BILL GATES: RICHEST AMERICAN EVER AND YOU THOUGHT ROCKEFELLER HAD MONEY - August 4, 1997

[turtle777]

Here's a fact: there's nothing anyone can do to make the richer "more poor".

Whatever politicians do, it can only make the richer richer, or try to change the status of the poor.

Therefore, the smart thing is to accept that the rich are and will be rich.
Focus on true measures that give the poor a chance to improve their standing.
But they need to *DO* it themselves, ultimately. Just giving them money is not making them richer, it's just making them addicted to the gubmint teet.

-t

[Big Mac]

Originally Posted by nonhuman 

Maybe they shouldn't have chosen to have kids yet and instead used that reduced cost of living to leverage themselves into a more stable financial bracket.

nonhuman elegantly states a view I was hesitant to express. I decided for myself pretty early on (in my teens) that I would not bring children into the world without being able to provide them with a certain level of economic security. Some people don't think about that issue before having kids, but then some of them turn around and complain about being overworked and underpaid. Perhaps they should have invested more in their educations and careers prior to having children.

You know something that I've noticed lately about many very successful people in the media? Many of them have young children while they themselves are relatively older. Perhaps it isn't indicative of an overall trend, but I noticed, as one example, that Adam Sandler at the age of 44 has two young daughters. He got married in 2003. That fact makes me feel a bit better about still being single in my late 20s while many of my age cohort friends are settling down.

[imitchellg5]

Originally Posted by Big Mac 

Your anecdote does not prove the validity of your statement about capitalism. Your anecdote speaks more to particular adverse circumstances and poor choices made by individuals than it does economic exploitation.

Originally Posted by nonhuman 

Maybe they shouldn't have chosen to have kids yet and instead used that reduced cost of living to leverage themselves into a more stable financial bracket.

It doesn't seem unreasonable to me that an adult (I'm by far the youngest there, my coworkers are from 35-65 years of age) can have a child. Nontheless, having a kid has nothing to do with it. Society will always knock down certain people that it sees as unfit and prohibit them from what that society sees as success, here in Colorado Springs, they won't be able to succeed because they haven't gone to college and they have a Mexican background. Keep in mind that these folks aren't exactly living on the streets, they can afford to rent decent homes and put food on the table. They'll just never ever be able to do anything more than that.

[Big Mac]

Interesting. Perhaps things are very different in your neck of the woods, but here in California Spanish fluency is a job requirement in many postings. I don't see evidence of institutional discrimination against American citizens of Mexican descent around here at all.

Now the issue of employers discriminating on the basis of having or not having a college degree is a separate matter. I can also tell you from experience that having a Bachelors degree doesn't necessarily guarantee much in the way of employment, especially in the economic climate of recent years. The job market is poor all around, due substantially to the fact that corporations learned to be as productive or more productive with fewer workers during the downturn and now have less incentive to expand their payrolls coming out of the recession.

[BadKosh]

You have to have several things going for you to be successful. You must have a clear idea of how you are going to make money. You must have the guts to take that chance and risk everything. You must have the smarts and business sense to get through the details. It also requires timing. Those not willing to take a chance work for others who do. It requires resources. Some people just aren't ambitious or focused enough to make it. Sometimes it has to do with who you've hired to assist. You become successful if you can get past the BS and your idea/product is in demand. What you do with your profit also has to do with how rich you become. paying yourself a big salary in the beginning is usually a stupid move. Networking with others in businesses who use your products/services and increase the number of entities you trade with or who can be of help in your business by providing leads is important too. This takes lots of time and you will have to give up fun to become rich.

[olePigeon]

Originally Posted by BadKosh 

You have to have several things going for you to be successful. You must have a clear idea of how you are going to make money. You must have the guts to take that chance and risk everything. You must have the smarts and business sense to get through the details. It also requires timing. Those not willing to take a chance work for others who do. It requires resources. Some people just aren't ambitious or focused enough to make it. Sometimes it has to do with who you've hired to assist. You become successful if you can get past the BS and your idea/product is in demand. What you do with your profit also has to do with how rich you become. paying yourself a big salary in the beginning is usually a stupid move. Networking with others in businesses who use your products/services and increase the number of entities you trade with or who can be of help in your business by providing leads is important too. This takes lots of time and you will have to give up fun to become rich.

What about people who are sick, disabled, have sick or disabled dependents, inherited debt from a deceased family member, or are discriminated against because of your race, religion, etc?

Paraplegics are just lazy, I guess. Flailing their useless limbs. Why don't they just try harder?

[Big Mac]

As BadKosh said, "those not willing to take a chance work for others who do." His post is remarkably insightful. Only a certain percentage of the population has the ability to command top dollar salaries or strike it rich as entrepreneurs. If it were so easy to be successful everyone would be rich.

[imitchellg5]

But there are also people who don't do an ounce of work to become rich and never take chances.

[olePigeon]

Originally Posted by Big Mac 

As BadKosh said, "those not willing to take a chance work for others who do." His post is remarkably insightful.

Perhaps to his ignorance of the world around him. He's assuming that everyone has the same opportunities. That just isn't true.

[Shaddim]

Originally Posted by imitchellg5 

But there are also people who don't do an ounce of work to become rich and never take chances.

The people who inherit and don't work? They're pretty damned leaky where finances are concerned. They'll just burn through what they get, dumping it into the system and probably destroy their life in the process. Example: Paris Hilton.

[SpaceMonkey]

I think we have a pretty good balance of entrepreneurship and social safety nets as is. We're fighting about marginal changes.

[Big Mac]

Originally Posted by imitchellg5 

But there are also people who don't do an ounce of work to become rich and never take chances.

True, there are some instances like that, although they are rare. People in that category either made a lot of money early on and then just lived off that fortune, won the lottery, married rich or inherited from a rich relative. It happens, and in a free society where people have the opportunity to profit, they also have the opportunity to do with that profit as they please - to spend it, save it, donate it, pass it along to family, etc.

At times it seems unfair that some people have really easy paths to wealth that in certain cases they don't seem to deserve, but what's the alternative? The only one I can think of is government confiscation of wealth through various kinds of oppressive taxes (like high death taxes). I don't think it's at all proper to punish success like that just because the public resents how some of that wealth is distributed and enjoyed.

Originally Posted by olePigeon 

Perhaps to his ignorance of the world around him. He's assuming that everyone has the same opportunities. That just isn't true.

It seems to me that you're putting words in BadKosh's mouth. He never claimed that everyone has equal opportunities.

[lpkmckenna]

NYTimes: the Haves and Have-nots.

Interesting chart too:

[Doofy]

Originally Posted by BadKosh 

you will have to give up fun to become rich.

This is no fun at all.

[Doofy]

Originally Posted by olePigeon 

Paraplegics are just lazy, I guess. Flailing their useless limbs. Why don't they just try harder?

Something stopping a paraplegic from writing Harry Potter, was there? (given a few cheap voice gadgets, obviously)

[Shaddim]

Originally Posted by Doofy 

This is no fun at all.

I'm trying to figure out when I "gave up fun" to become rich, can't recall that ever happening.

[The Final Dakar]

Originally Posted by Laminar 

Why is this important?

Same reason we don't like power to be concentrated into too few hands, I imagine.

[BadKosh]

Originally Posted by olePigeon 

Perhaps to his ignorance of the world around him. He's assuming that everyone has the same opportunities. That just isn't true.

You MAKE your opportunities if you have the insight, and see the opportunity. You just seem to have a loser mentality. I saw an opportunity back in the mid-1970's and became a Disco DJ for hire. I paid my way through college and acquired some great audio equipment and over 4000 LPs. I saw an opportunity in the late 1990's and produced several HO scale model railroad kits which allowed me to keep my house.

[Doofy]

Originally Posted by Shaddim 

I'm trying to figure out when I "gave up fun" to become rich, can't recall that ever happening.

Me neither. But then, some people may be (unbeknownst to us) having a really, really super fun time at the local crack house.
Look at all the misery... ...all the tortured grimaces on the faces of the poor souls forced to endure not having a super fun time... I'd sure like to be getting out of that kind of thing and having as much fun as the poor do.

[Shaddim]

Originally Posted by Doofy 

Me neither. But then, some people may be (unbeknownst to us) having a really, really super fun time at the local crack house.
Look at all the misery... ...all the tortured grimaces on the faces of the poor souls forced to endure not having a super fun time... I'd sure like to be getting out of that kind of thing and having as much fun as the poor do.

I know! So sad, reminds me of the hell we experienced in Bermuda last year, and what we'll probably have to endure in Savona in the (very) near future. Yeah, yeah, it'll be colder, but I want to see Carnevale.

[imitchellg5]

What a sad existence. What's your Paypal, I'll send you a fiver.

[Uncle Skeleton]

Originally Posted by Big Mac 

Only a certain percentage of the population has the ability to command top dollar salaries or strike it rich as entrepreneurs. If it were so easy to be successful everyone would be rich.

I wish more people would consider the possibility that everyone actually is quite rich, especially in places like the US and England. It's only compared to the even richer that we don't feel rich.

Originally Posted by SpaceMonkey 

I think we have a pretty good balance of entrepreneurship and social safety nets as is. We're fighting about marginal changes.

I agree 111%

[Shaddim]

Originally Posted by imitchellg5 

What a sad existence. What's your Paypal, I'll send you a fiver.

sure it's br549@feedtherich.org

thanks!

[SpaceMonkey]

[Doofy]

Originally Posted by Shaddim 

I know! So sad, reminds me of the hell we experienced in Bermuda last year, and what we'll probably have to endure in Savona in the (very) near future.

I feel your pain.
Never mind, one has to stay positive... ...maybe one day you'll be able to go have a super fun time in Lake Havasu or Blackpool. Or, if you're really lucky, Dnipropetrovsk.

[Big Mac]

Originally Posted by Uncle Skeleton 

I wish more people would consider the possibility that everyone actually is quite rich, especially in places like the US and England. It's only compared to the even richer that we don't feel rich.

Yeah, I don't know about that, unless by "everyone actually is quite rich" you're talking in a figurative sense. Some percentage of the population still struggles even in the richest countries. And right now unemployment and underemployment are still serious problems in the US. We thankfully haven't seen riots over it like there have been in poorer countries, but just because in the aggregate America is the richest country in GDP terms doesn't mean all Americans are rich. Too many are just scraping by, if that. But I don't blame rich people or capitalism for that fact at all.

[Laminar]

Originally Posted by Big Mac 

Too many are just scraping by.

With cable TV, air conditioning, a couple cars, and an unlimited supply of PBR to drown the sorrows of "poverty."

[Big Mac]

Originally Posted by Laminar 

With cable TV, air conditioning, a couple cars, and an unlimited supply of PBR to drown the sorrows of "poverty."

If you think that's the standard of living the unemployed and underemployed are enjoying on average, then either Iowa is an economic oasis with prosperity for all, or you have a really warped view of what those Americans are going through.

[mattyb]

Wonder how many people here earn more than $500,000 per year.

[Uncle Skeleton]

Originally Posted by Big Mac 

Yeah, I don't know about that, unless by "everyone actually is quite rich" you're talking in a figurative sense. Some percentage of the population still struggles even in the richest countries.

Struggles for what, exactly? To put food on the table or to keep up with the Jones's? Considering obesity is a larger problem than hunger, especially in the poorer populations, I'm having a hard time believing it's the former.

Now there certainly are a large number of homeless people struggling with sanity, but this is purely a medical problem, it has nothing to do with economics.

[Shaddim]

Originally Posted by mattyb 

Wonder how many people here earn more than $500,000 per year.

And if they did admit it, would people just take shots at them? Likely.

[Doofy]

Originally Posted by mattyb 

Wonder how many people here earn more than $500,000 per year.

Everybody.
..in ZWL.

[mattyb]

Originally Posted by Shaddim 

And if they did admit it, would people just take shots at them? Likely.

If you make $500,000 a year from renting out eastern european children then I'll take a shot at you.

If you make artificial limbs and employ people then I won't.

I should know better than to post in the PWL.

[Laminar]

Originally Posted by Big Mac 

If you think that's the standard of living the unemployed and underemployed are enjoying on average, then either Iowa is an economic oasis with prosperity for all, or you have a really warped view of what those Americans are going through.

Enlighten me. How many TVs, cars, and cans of beer does the average person living below the poverty line (that's a fair, unbiased line to use in a discussion about economic prosperity, no?) own?

[mduell]

On a related note, the 5% of Americans who became unemployed in the last couple years produced no marginal value, since sales have fully recovered but the jobs haven't.

Originally Posted by Tyler Cowen

Before the financial crash, there were lots of not-so-useful workers holding not-so-useful jobs. Employers didn't so much bother to figure out who they were. Demand was high and revenue was booming, so rooting out the less productive workers would have involved a lot of time and trouble -- plus it would have involved some morale costs with the more productive workers, who don't like being measured and spied on. So firms simply let the problem lie.

Then came the 2008 recession, and it was no longer possible to keep so many people on payroll. A lot of businesses were then forced to face the music: Bosses had to make tough calls about who could be let go and who was worth saving. (Note that unemployment is low for workers with a college degree, only 5 percent compared with 16 percent for less educated workers with no high school degree. This is consistent with the reality that less-productive individuals, who tend to have less education, have been laid off.)

In essence, we have seen the rise of a large class of "zero marginal product workers," to coin a term. Their productivity may not be literally zero, but it is lower than the cost of training, employing, and insuring them. That is why labor is hurting but capital is doing fine; dumping these employees is tough for the workers themselves -- and arguably bad for society at large -- but it simply doesn't damage profits much. It's a cold, hard reality, and one that we will have to deal with, one way or another.

emphasis mine

[Big Mac]

Originally Posted by Laminar 

Enlighten me. How many TVs, cars, and cans of beer does the average person living below the poverty line (that's a fair, unbiased line to use in a discussion about economic prosperity, no?) own?

Originally Posted by Uncle Skeleton 

Struggles for what, exactly? To put food on the table or to keep up with the Jones's? Considering obesity is a larger problem than hunger, especially in the poorer populations, I'm having a hard time believing it's the former.

I'll give you guys some anecdotal examples. A close friend of mine has been struggling with outside employment since graduating college in 2006. He has a small business that is just now starting to break even, although he's only been in the black for a short period of time. He worked for two years as a paid administrator at a small non-profit, but given the economy they can barely afford to stay open and are almost all volunteer based now. Other than that, all he has been able to find is temp work, and if you talk to other temporary workers you'll hear similar stories. Luckily, my friend has a great mother and (younger) brother who assist him, and he has a sizable inheritance (although he can only get small amounts of it for now because of the way it was structured). If not for those factors he'd be on the streets.

My cousin, whom I've written about in the past, is one of the hardest workers I've ever known. He comes from a semi-broken home. He works at In-and-Out. He drives a real beater of a car that goes out on him constantly. He had to take a semester off of community college because his mother needed him to drive her to court mandated counseling (she's a drug abuser who was convicted of some kind of domestic abuse). He got stuck with a $1,000 credit card bill when someone racked up charges on his account, and apparently the sub-prime card he has is very poor about fraud protection. He had to get away from his mother and sister for a while because they were abusing drugs together; the sister subsequently overdosed and died. I could go on and on about his problems. Oh yeah, he's apparently now helping his step-father who just got his house foreclosed on. His living situation is very precarious. Yet he has one of the most cheerful, optimistic attitudes about life and the future.

My best friend from high school changed over to a science major a couple of years into college. He seems to be very knowledgeable, yet neither he nor his girlfriend in the same field could find work when I saw them months ago. They told me that other scientists with much more experience were competing for the low-end jobs. I think I'll give him a call and see how he's doing.

Here's another one: Another cousin of mine is married to a computer engineer who experienced a lay-off about a year ago. He used to manage the I/T department of the NY headquaters of a European bank. Even though he's really qualified with years of experience, he can't find a stable position.

I think these kinds of stories are symptomatic of what the underemployed, unemployed and chronically unemployed are going through. Certainly most of the country is doing well enough, but there is suffering out there. And it's not just relative poverty, it's actual poverty, among hard working people.

Anyway, I'm kind of shocked that in a forum full of liberals you've got me, an arch-conservative who wants to radically cut the welfare state, as one of the only voices arguing for the economically challenged in America. Strange situation you guys have me in. I can't be the only one who sees these types of problems, right?

[besson3c]

Originally Posted by Shaddim 

The people who inherit and don't work? They're pretty damned leaky where finances are concerned. They'll just burn through what they get, dumping it into the system and probably destroy their life in the process. Example: Paris Hilton.

Paris Hilton is not burning through what she has, but she was able to do what she does because of her inheritance, I'm sure.