Comments on inequality or middle incomes_ which matters more_ _ the economist


Interesting that the Ecommunist would cite Thomas Piketty et al after so many negative reviews and criticisms have been written about his work regarding wealth and inequality. Gbp to usd exchange rate history He and his colleagues have, for the most part, either acknowledged mistakes in their methodology or have not responded to valid critiques at all. Binary editor Tim Worstall writes:

‘It’s been obvious for some time now that Thomas Piketty may well have had a best seller but also that his actual analysis was wrong. Usd to inr history His point being that there was some ever rising concentration of wealth in the economy and that this was a very bad thing.

Gold chart 1 year The problem with this thesis is that when people go looking for this concentration they just cannot find it. Pounds to us dollars converter We thus rather end up having to say that there isn’t some concentration of wealth going on so whether it’s a good or a bad thing doesn’t really apply.

On this very subject there’s an interesting Brookings paper just out. Binary multiplication Which looks at the composition of capital in the US and it simply cannot find that concentration that Piketty claims is there. Call option price formula Here’s the abstract:

In the postwar era, developed economies have experienced two substantial trends in the net capital share of aggregate income: a rise during the last several decades, which is well-known, and a fall of comparable magnitude that continued until the 1970s, which is less well-known. Usd to sgd conversion Overall, the net capital share has increased since 1948, but when disaggregated this increase comes entirely from the housing sector: the contribution to net capital income from all other sectors has been zero or slightly negative, as the fall and rise have offset each other. Usa today sudoku answers When decomposed into a return on fixed assets and a residual share of pure profits, the fall and rise of capital income outside the housing sector in the US owes mostly to the residual: it is not paralleled by fluctuations in the measured value of non-housing capital. Binary worksheet This observation—combined with the theory of factor substitution, and simulation results from a multisector model—casts doubt on explanations of changes in the net capital share that rely on changes in the value of capital. Fx rate gbp to usd There is greater support in the data for narratives that emphasize cyclical and trend variation in market power.The effect that Piketty claims we’ve got to be so worried about just isn’t there. Usd to myr exchange rate Thus it’s really very difficult indeed to get very worried about it…It’s not actually about housing, it’s about the value of land that you are allowed to put housing upon. Future stock market crash That is, zoning and or planning permission (dependent upon the country you want to talk about). Canadian dollar to usd This is more obvious in my native UK than it is for the US, for zoning really only affects pricing on the coasts. Rs to us dollar Most of Flyover Country doesn’t have enough restrictions upon what you may build and where to create a scarcity value. Gold price 2016 Amusingly, it’s two sometimes collaborators with Piketty, Saez and Zucman, who investigate this, as explained here. Cool pictures of nature In terms of financial wealth there’s been pretty much no major change other than that private pension (which do not tend to accrue to the very wealthy) savings have risen. Name in binary The rise in capital has been pretty much all to do with the rise in the value of permission to build a house on a particular piece of land. Pound usd Now it is possible that that’s a problem. Currency converter jpy to usd But it would seem to be one which would be solved by issuing more permits to build on land than by instituting a wealth tax which is what Piketty recommends. 1 usd to sgd The more we investigate the details of Piketty’s claims the more they seem to be wrong. Decimal word problems grade 6 After all, even Paul Krugman pointed out that while his theory is all very interesting there just doesn’t seem to be any evidence that it’s true.’

Politically, we can all judge for ourselves whether Americans prefer candidates that whinge on incessantly about how unfair our country is and that more redistribution of wealth is necessary, or candidates who run on a message of growth and prosperity as “the tide that lifts all boats.”

The Economist at least notes (somewhat begrudgingly) that “Polls usually suggest that Americans care less about inequality than they do about economic opportunity.” I will put it more bluntly — while progressives like Bernie Sanders and Elizabeth Warren rail on about inequality, the simple fact of the matter is that, deep down, Americans don’t really give a damn about inequality.

They never have. Stock market futures charts In America, no one really gets concerned if their neighbor suddenly gets a windfall and becomes rich. Aud to usd forecast 2015 We might be a bit envious for their lucky break, but we don’t begrudge them their new-found wealth, because we recognize that they are not making me any poorer even if the “inequality” between us is growing larger.

What Americans care about is having a fair shot at getting their own windfall. Usd law school ranking They want to know that if they bust their tails, and perhaps get a little lucky, they can grow their own wealth and be better off tomorrow than they were yesterday. Famous quotes about life It doesn’t have to grow as fast or as large as other peoples’ wealth, so long as it grows enough to help satisfy all of their needs and at least a few of their wants.

In contrast, progressives view the world as a win-lose proposition: if someone else is growing their wealth, it must be at your expense, and you should therefore be resentful. Exchange rate pounds to us dollars This viewpoint incorrectly assumes that global wealth is a zero-sum game, and that if someone else is earning wealth, someone must be getting deprived of that wealth elsewhere. Binary code generator This is a fallacy rooted in a politics of resentment and jealousy, where the success of others is viewed as a failure.

It reminds me of the old Russian story of the farmer that finds a genie in a bottle. Dow futures trading hours The genie tells the farmer that he will grant the farmer one wish, but whatever he wishes for, his neighbor will be given double. Uk to us conversion The Russian farmer thinks about it for a while, and then tells the genie “I wish for one of my eyes to be plucked out”.

No one should care about what their neighbor is getting. Usd inr rate They should be focused on what they are getting, and if they are growing their own wealth and paying their bills and moving up in the world, they shouldn’t be comparing themselves to others or trying to “keep up with the Joneses”.

Inequality is a red herring, and Americans intuitively know this regardless of whether they can articulate it correctly. Equity finance investment They want opportunity, and as long as they view themselves as getting a fair chance on their own merit, they don’t ask that all the outcomes have to be equal.

This is clearly incorrect, there is very good polling and research showing Americans do care about high inequality because they recognise it stifles people’s potential, and limits opportunities. British pound historical exchange rate Increasingly I imagine it is a result of them knowing the wealth of evidence on the pernicious effects of very high inequality on society and, it seems potentially, the economy.

It is not progressives who see the world as a zero-sum game, it is those obsessed with competition rather than collaboration. Xau usd forecast today Smart progressives recognise both are important components of a functioning economy, which means they recognise that government has an important role to play, for example. Binary form music They also have a more nuanced understanding of power it seems than conservatives and libertarians.

Progressives understand that today’s huge inequality of outcome is tomorrow’s inequality of opportunity, and that measures, whether market based or government led, are important to counter this and provide a more level playing field.

Perhaps none of us should care what our neighbours earn, unfortunately that is human nature, we are interested in others and their status. Pln usd exchange rate The problem with very high inequality is that it exacerbates concerns over our own status compared to others. Stock outperform definition If society is more equal, falling down a rung on the ladder is less worrying, and the desperation to climb up a rung is less all consuming. 1 trillion zimbabwe dollars to usd That doesn’t detract from necessary competition either, ask Sweden, who have a far higher number of entrepreneurs than the US.

Inequality is anything but a red herring. Usd bookstore hours I’d agree most people will talk about jobs and earning more before they worry about inequality, but the effects are pernicious and the ultimate outcome of letting inequality spiral is usually not pretty.

I totally agree with you on this. Usd aud chart And you articulated it 100% correctly, in my view, in so far as I have personally come to learn about America and Americans in the shoes of a naturalized citizen from another country.

EXCEPT I had thought all along that the term “Progressive”, which you used throughout your post, refers to the folks who are NOT jealous of other people’s (and this includes other countries’) successes, whether on measures of wealth, academic achievement, occupational achievement, general knowledge of the world and degree of sophistication on matters of language and culture. Decimal worksheets Same folks as those who do NOT believe, to quote your EXACT words, “global wealth is a zero-sum game”, and “a neighbor’s doing better means they are doing poorer”.

Rather, it was a group of sundry white Americans consisting of bigots and profound underachievers who call all people who are not white but in a better station in life than they the Progressive, the Elite, the Useless Intellectuals, the Pseudo Scientists (not that these bigots know the first thing about what science is).

This group of folks present the general impression they comprise the Have-Nots. Binary hex converter In general they are the poorly educated and the poor. Gbp usd bloomberg These are folks who are not very informed and not very intelligent. 1 usd to inr yesterday They can’t tell a fact from an opinion and an opinion from a myth. Put and call option agreement Some do not even know the history and laws of their own country, starting from the Constitution and Amendments to the Constitution I (1791) thru XXVII (1992). The box store Let alone the history and cultures of other countries in the world. Practice problems Worse, they have no inclination to learn. Rub usd chart These are the same folks who ARE jealous of other people’s legitimate and hard-earned successes (particularly when the success is had by people who are not white and who are not male). Dollar pak rupee exchange rate These are the folks who are constantly, at least for the last 10 years, griping about how all welfare recipients are “colored people” (anything from black to brown and even yellow), how anyone who enjoy the successes they don’t have do it by stealing, robbing, and cheating, including the manner legal immigration is obtained.

All these folks I just described, I had thought, comprised a strangest group of Americans or folks who call themselves Americans who are in perpetual hostility toward anyone they call a “progressive”. Convert usd to kwd It is they who frame all issues – regardless whether the issue is political, social, or cultural – in terms of “Either you die or I die”, and “No one is allowed to succeed if I don’t or haven’t”.

Your answer is very important to me. Usd rub exchange rate I was, in the year I became an American by naturalization, a Republican. Aud to usd history Thereafter, having gotten a closer look at what being a Republican means in Amercica, I ran the hell and became a Democrat – in my mind, the lesser of the evils. Msn news usa homepage I note Bill Gates and Warren Buffet are both Democrats. British pound to usd exchange rate Both would be considered well-educated, not poor, read with high level of comprehension and able to add and subtract big numbers.

Exactly how does inequality stifle potential and limit opportunities? If your neighbor suddenly makes double what you do in income, how does that impact your potential and opportunities? The short answer is, it doesn’t.

Your potential and opportunities remain the same regardless of what someone else down the street happens to be earning. Sprint troubleshooting Your premise only makes sense if you believe that the world contains a finite amount of wealth, and that therefore if someone else is depleting that storehouse of wealth, there is less of it available for you. Currency converter usd to pounds However, this is patently false, as the world does not have finite amount of wealth — wealth is continuously being generated, with no inherent outer limits.

“So the company ceos and shareholders getting larger ROI while their ex employees working Walmart and two other jobs part time for no benefits has nothing to do with it?”

If a CEO gets a million dollar bonus, or a shareholder gets an extra dividend, that has no bearing on whether you get more wealth or less wealth. Silver chart If you are a worker in that particular company, then presumably the shareholders are getting extra dividends because the company was more profitable, and if the company was more profitable, the employees would be getting their incentive bonuses or wage increases (additionally, a company might actually be hiring more workers to keep up with increased demand).

You seem to think of the economy as a closed system, in which every dollar given to someone else is a dollar less for you. Silver chart kitco It is not a closed system. Dollar exchange rate history Someone could get 10 dollars extra for every 1 dollar extra given to you, and there is a lot of inequality associated with that distribution, but their increased wealth does not mean your wealth is somehow decreasing.

You also seem to think that if there are 11 extra dollars lying around, that should go to everyone more equally, instead of on a 10 to 1 ratio. Gold price chart I have yet to see any rational argument as to why that has to be the case, or why that makes someone worse off. Convert cny to usd All 11 of those dollars is extra wealth you didn’t have before, so whether you get 1 or 10, it is still an increase in your wealth.

Finally, perhaps you have in mind the caricature of the investment capitalist that buys a company, lays off a thousand workers, then pockets the saved wages, chuckling all the way to the bank. Futures market cnbc However dramatic that rather cartoonish view may be, it is largely fictional — most companies that get bought and downsized (or “rightsized” depending on your point of view) were in dire straights to begin with, and at risk of having EVERYONE lose their jobs. Binary search tree visualization When a company can jettison a thousand jobs to save another thousand jobs, improve efficiency, become profitable again, then the economy is benefitted and the remaining workers, shareholders, and executives can (and should) enjoy the profits of their successful turnaround. Gender identity issues Those that have been downsized may rightfully feel left out, but that is not an issue of inequality — that is an issue of economic efficiency and productivity. Uk to us currency If a factory entirely automates, leaving former workers left out, and others are enjoying the benefits of the improved factory, that is not an issue of inequality — that is an issue of technological advancement and training/skills.

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