The extent of inequality in the US
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  The extent of inequality in the US
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Author Topic: The extent of inequality in the US  (Read 4725 times)
krazen1211
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« Reply #25 on: March 07, 2013, 08:41:35 PM »

The present value of social security can only be considered $0 as Social Security is under the considerable risk that Congress can defund it at any time it chooses.

Unless either you estimate the probability of Social Security being completely defunded by Congress before you get a single dollar out of it to be equal to exactly 100%, or you believe that with positive probability the Congress will start charging you for being alive past the retirement age, expected present value of Social Securtiy would have to be positive. So, which of the two above-mentioned options reflects your beliefs?

The dollars that you get out of it, in the event you get them, have to be netted out against the dollars you put into it. If you were born in 1980 or later that number is already effectively negative for many folks.

In any case, the more likely scenario is that some members of Congress seek to partially or fully defund  the program for successful responsible folks who saved money and continue cut checks to the irresponsible freeloaders.
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Link
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« Reply #26 on: March 07, 2013, 10:08:36 PM »

In any case, the more likely scenario is that some members of Congress seek to partially or fully defund  the program for successful responsible folks who saved money and continue cut checks to the irresponsible freeloaders.

You obviously have no idea how social security works.
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Gustaf
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« Reply #27 on: March 08, 2013, 05:02:50 AM »

Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.
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DC Al Fine
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« Reply #28 on: March 08, 2013, 09:11:19 AM »

Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.

There's also peoples' inability to deal with large numbers. The difference between a net work of $200 000, $500 000 and $2 000 000 doesn't necessarily lead to very different lifestyles.
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opebo
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« Reply #29 on: March 08, 2013, 09:17:20 AM »

Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.

There's also peoples' inability to deal with large numbers. The difference between a net work of $200 000, $500 000 and $2 000 000 doesn't necessarily lead to very different lifestyles.

You fellows are quite missing the point!  What matter is that wealth inequality equals power inequality - the correct way to understand it is the wealthy own (control) the poor.  That is what wealth means - control of other people.  Anything else would be meaningless.  Income is just an issue of subsistence, but wealth is a political issue - by its very nature..
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All Along The Watchtower
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« Reply #30 on: March 08, 2013, 11:08:59 AM »

Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.

lol, please.
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krazen1211
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« Reply #31 on: March 08, 2013, 12:13:13 PM »

In any case, the more likely scenario is that some members of Congress seek to partially or fully defund  the program for successful responsible folks who saved money and continue cut checks to the irresponsible freeloaders.

You obviously have no idea how social security works.


No, I do. Ida Mae Fuller got 1000x her payroll tax contribution in Social Security payments.

The left likes to pick winners and loses you see.
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Gustaf
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« Reply #32 on: March 08, 2013, 03:23:36 PM »

Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.

lol, please.

Ok, how many people younger than 25 have any wealth? Is that a societal problem? Sweden has a wealth distribution similar to the US, where about 60% of all assets are owned by the top 10%. Yet, Sweden is usually considered to be a country with fairly high equality.

The maker of the video seems pretty confused, because he keeps making implicit or explicit references to income rather than wealth.
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They put it to a vote and they just kept lying
20RP12
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« Reply #33 on: March 08, 2013, 03:44:24 PM »

The left likes to pick winners and loses you see.

And the right only picks losers.
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krazen1211
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« Reply #34 on: March 08, 2013, 05:23:53 PM »

The left likes to pick winners and loses you see.

And the right only picks losers.


No, the free market does that. 
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Antonio the Sixth
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« Reply #35 on: March 08, 2013, 05:36:14 PM »

The left likes to pick winners and loses you see.

And the right only picks losers.


No, the free market does that. 

Dude, you just got owned big time. At least have the decency to shut up.
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opebo
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« Reply #36 on: March 09, 2013, 12:01:44 PM »

The left likes to pick winners and loses you see.

And the right only picks losers.

No, the free market does that. 

The State picks the winners (the wealthy) and the losers (those the wealthy control), krazen.  The fact that you call this a 'free market' is evidence that you have no understanding and are completely duped.
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Politico
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« Reply #37 on: March 10, 2013, 05:14:59 PM »
« Edited: March 10, 2013, 05:33:33 PM by Politico »

The maker of the video seems pretty confused, because he keeps making implicit or explicit references to income rather than wealth.

It almost goes without saying that most progressives are confused when it comes to anything related to economics. The reason why they have such a hard time with Romney's income being about $20 million a year is because they think he turns around and consumes $20 million worth of goods/services each year. Their lifestyle choice is to live paycheck-to-paycheck, blowing huge chunks of their income on things they really do not want let alone need, so they figure Romney does the same with his income. The reality is this:



Of course, he has a nicer house than the average Costco shopper, but it's not like he's living it up in Italy with George Clooney, or partying with Bill Maher at the Playboy Mansion. Of course, the most creative people in Hollywood are the accountants. The hypocrisy of the left is sickening...
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opebo
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« Reply #38 on: March 10, 2013, 05:24:40 PM »

The reason why they have such a hard time with Romney's income being about $20 million a year is because they think he turns around and consumes $20 million worth of goods/services each year.

No, Politico, no one cares what he does with the money.  The fact that he got it out of the hides of the poor workers he controls is what is objectionable.    It is the power of capital to which one objects, not their obscene lifestyles.
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RI
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« Reply #39 on: March 13, 2013, 10:29:29 AM »

I think this finding is more a result of people not understanding percentages and distribution functions more than anything else.
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DC Al Fine
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« Reply #40 on: March 13, 2013, 01:08:50 PM »

I think this finding is more a result of people not understanding percentages and distribution functions more than anything else.

Amen
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opebo
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« Reply #41 on: March 14, 2013, 11:33:54 AM »

I think this finding is more a result of people not understanding percentages and distribution functions more than anything else.

Amen

Thank you for pointing out the error!  The US is in fact quite egalitarian - what a relief.
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Redalgo
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« Reply #42 on: March 14, 2013, 05:43:27 PM »


I am generally more concerned about statistics concerning inequality of income than of inequality of wealth. Given my more-expansive-than-typical definition of capital I would be far more interested in seeing how the U.S. stacks up when judged by an index quantifying social, cultural, symbolic, economic, etc. assets to display more comprehensively how privileges and power are distributed across the American population.

That point of criticism being set aside however, I agree with Antonio quite completely that one of the most intriguing lessons to walk away from this video with is how incredibly influential it can be for private interests to frame debates and manipulate perceptions of reality. My opinion of how income should be distributed is quite similar to how most of the polled Americans seemed to want wealth to be allocated (which is noteworthy since I suspect most people who were polled lacked a firm understanding of what the word wealth means in economics... unless it was explained to them prior to the questions being asked?), yet their voting behavior does not seem to coincide very well with their own ideals as they pertain to political economy.


. . . The reason why so many younger people favor increased taxation and more Big Government that taxes-and-spends like crazy is because they've yet to experience THEIR tax rates going through the roof to fund Big Government. If you think the tax increase that happened in January is where it ends, that is not the case if most Democrats get their way in the midterms next year. Congressional Republicans and the few remaining conservative Democrats are the only reason why we have yet to return to out-of-control Big Government reminiscent of what we saw in the 1970s.

I am willing to pay up to half of my earnings in taxes despite being well below the poverty line in the States. A number of policies from back in the ‘70s are unappealing to me. Still, I would rather have some basic security in my finances in the unlikely event that I someday fall out of work for a few months than a 0% income tax. Smiley


The diagnosis is clear. But what can be the cure? Income tax increases might reduce the dynamics, but would leave the underlying pattern of wealth distribution untouched. Plus, you risk running into the Big Government scenario adressed by politico.

Wealth taxation and successive redistribution? We are not talking about land ownership anymore, this wealth is made up of bonds, shares, and derivatives. Highly mobile, and also so interlinked with the 'real economy' that you have to be careful to not kill the base of wealth generation altogether.
It is not as simple as the video graphics suggest - take some greenbacks from the big pile to the right and give it to the poor guys on the left. In practice, it would be more like transfering 0.0x% of Microsoft or Apple shares to each single mother. Interesting experiment, for sure, but I am unsure about the outcome. Would that really be a long-term redistribution of wealth, or just  a short-term cash-transfer, with all its consequences (stock exchange crash, inflation, better-fed children, etc.) ?

I don't have an answer yer.

I fancy some deregulation, tax code simplification, and abolition of both the corporate tax and minimum wage in concert with increased taxes in some manner based on ability to pay, strong incentives for the gradual conversion of conventional firms into for-profit workers’ coops, and regulation for ratios of compensation packages awarded to workers relative to one another in their respective firms; i.e. set up better rules affecting business procedures for pay allotment in the first place so the state need not engage in heavy redistribution to achieve a more desirable set of outcomes. I am starting to think those results are unlikely to be delivered by a comprehensive welfare regime – though I certainly still want one to exist for the sake of achieving other goals. 


Just as an FYI, the video is very misleading and based on a poor understanding of economics. Wealth distribution is naturally very unequal and it's not much of a social problem either. It's income distribution which is relevant and that's probably also what people were thinking of when saying what distribution they want.

At this time I cannot think of any advanced, affluent countries in the world that have low levels of inequality in regards to wealth, and was going to use Sweden as an example in support of your point until I found that you did so just awhile later. Whether disparities along these lines are really natural or just particular to certain economic systems remains unclear to me, but for the time being it is certainly tempting for me to express agreement with your posts thus far in this thread.
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King
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« Reply #43 on: March 15, 2013, 10:56:48 PM »

The reason why they have such a hard time with Romney's income being about $20 million a year is because they think he turns around and consumes $20 million worth of goods/services each year.

The reason people have a hard time believing Romney has an income of $20 million a year is because Romney is a definitively unproductive person who has done no work in nearly six years, even referring to himself as unemployed, and is continually rewarded by the invisible hand of the free market for his non-efforts.
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Hatman 🍁
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« Reply #44 on: March 16, 2013, 12:06:32 AM »

If Romney was spending all of his income, that would be great! He would be returning the money into the economy, which is how capitalism is supposed to work. What he and most rich people to is sit on the money, which doesn't circulate it, causing inflation and inequality.
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opebo
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« Reply #45 on: March 16, 2013, 06:05:49 AM »

The reason why they have such a hard time with Romney's income being about $20 million a year is because they think he turns around and consumes $20 million worth of goods/services each year.

The reason people have a hard time believing Romney has an income of $20 million a year is because Romney is a definitively unproductive person who has done no work in nearly six years, even referring to himself as unemployed, and is continually rewarded by the invisible hand of the free market State-imposed power-hierarchy for his non-efforts.
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DC Al Fine
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« Reply #46 on: March 16, 2013, 08:12:25 AM »

If Romney was spending all of his income, that would be great! He would be returning the money into the economy, which is how capitalism is supposed to work. What he and most rich people to is sit on the money, which doesn't circulate it, causing inflation and inequality.

Hatman, do you think he built a giant swimming pool for his millions? No, the money is invested and companies make purchases with his capital. Obviously a degree of equality is desirable for social cohesion, but making blatantly false assertions about what happens to rich people's money is just silly.
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Hatman 🍁
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« Reply #47 on: March 16, 2013, 09:05:36 AM »

If Romney was spending all of his income, that would be great! He would be returning the money into the economy, which is how capitalism is supposed to work. What he and most rich people to is sit on the money, which doesn't circulate it, causing inflation and inequality.

Hatman, do you think he built a giant swimming pool for his millions? No, the money is invested and companies make purchases with his capital. Obviously a degree of equality is desirable for social cohesion, but making blatantly false assertions about what happens to rich people's money is just silly.

So, all of his money is "invested" then? I doubt every last cent is.
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DC Al Fine
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« Reply #48 on: March 16, 2013, 09:27:54 AM »

If Romney was spending all of his income, that would be great! He would be returning the money into the economy, which is how capitalism is supposed to work. What he and most rich people to is sit on the money, which doesn't circulate it, causing inflation and inequality.

Hatman, do you think he built a giant swimming pool for his millions? No, the money is invested and companies make purchases with his capital. Obviously a degree of equality is desirable for social cohesion, but making blatantly false assertions about what happens to rich people's money is just silly.

So, all of his money is "invested" then? I doubt every last cent is.

Hatman, if he's not spending it, and he's not investing it, where do you think his money is? Even if it's in a savings account, the bank can loan out the money for mortgages etc.
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Hatman 🍁
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« Reply #49 on: March 16, 2013, 09:34:45 AM »

If Romney was spending all of his income, that would be great! He would be returning the money into the economy, which is how capitalism is supposed to work. What he and most rich people to is sit on the money, which doesn't circulate it, causing inflation and inequality.

Hatman, do you think he built a giant swimming pool for his millions? No, the money is invested and companies make purchases with his capital. Obviously a degree of equality is desirable for social cohesion, but making blatantly false assertions about what happens to rich people's money is just silly.

So, all of his money is "invested" then? I doubt every last cent is.

Hatman, if he's not spending it, and he's not investing it, where do you think his money is? Even if it's in a savings account, the bank can loan out the money for mortgages etc.

So, his money is getting "borrowed". That's not really using his money, because he still gets to keep that money, as the borrowers will be indebted to the bank. I'm talking about using his money by having it spent. That's how you get the economy going. Borrowing just puts people into debt, which leads to the problems we have had the last few years. 
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