Question for people that hate the excessively rich...

[JPhillips]

Originally Posted by molson

And I've been fighting the assumption that the billionaires in the U.S. are billionaires at the expense of everyone else. That if they were never born, that wealth would have instead been used to take people out of poverty somehow. That's the implied assumption whenever these disparity stats are paraded here, but nobody ever backs it up.

I think you are making a mistake in believing that the accumulation of personal wealth is inherently good for the nation. I could certainly see instances where that is true, but I can also see instances where that is false. It's an extreme example, but Bernie Madoff was a billionaire and he certainly didn't provide a net benefit for society.

[Autumn]

Originally Posted by molson

And I've been fighting the assumption that the billionaires in the U.S. are billionaires at the expense of everyone else. That if they were never born, that wealth would have instead been used to take people out of poverty somehow. That's the implied assumption whenever these disparity stats are paraded here, but nobody ever backs it up.

I don't think that's the only possibility. There is also the possibility that they've generated wealth through their work, but also accumulated wealth that could have gone to their workers, their management, the cities and locales they work in, etc., that also played parts in creating that wealth. I would argue the suggestion that whatever wealth they managed to get is automatically wealth they've earned. We can see that in extreme places like Russia, with the oligarchs, but we have a harder time seeing it in our own culture. This is not a complete free market, as I think we can all agree, and there are many factors which determine the outcome of how much wealth a person ends up with, and where it came from.

[Autumn]

Originally Posted by Galaxy

So explain your theory.

I've been trying to make clear that I don't have a theory, I'm not an economist. I have my pet ideas, just as everyone here does. But without spending a great deal of research, none of us can come here and claim they know why income levels differ in the U.S. and other countries.

[molson]

Originally Posted by JPhillips

I think you are making a mistake in believing that the accumulation of personal wealth is inherently good for the nation. I could certainly see instances where that is true, but I can also see instances where that is false. It's an extreme example, but Bernie Madoff was a billionaire and he certainly didn't provide a net benefit for society.

Maybe that's true, but when I read that article that was posted, I still hear largely the same refrain - the rich have too much. It's about the rich. The focus is not on the middle class. If the rich had less, we'd all be happier, even if we had less too. That's just my opinion, and I think it's the part of it that speaks to envy/jealousy/greed.

[Passacaglia]

Originally Posted by DaddyTorgo

i enjoy the inherent bias in the thread title.

not sure if anyone actually HATES them.

Oh, I'm sure some people do.

[Autumn]

Originally Posted by RomaGoth

Do you have any factual evidence to back this up?

I can try to rummage up some numbers online, but it is my understanding that in general European workers earn more per hour, have better benefits and work less, while the U.S. outdoes them in income by working more hours (20% more I've seen) and working further into retirement age. As an aggregate I believe the U.S. economy outdoes them by quite a bit in pure wealth, but that measures of standard of living and personal income do not match up.

[Autumn]

Originally Posted by molson

Maybe that's true, but when I read that article that was posted, I still hear largely the same refrain - the rich have too much. It's about the rich. The focus is not on the middle class. If the rich had less, we'd all be happier, even if we had less too. That's just my opinion, and I think it's the part of it that speaks to envy/jealousy/greed.

Well that's not surprisingly, really, humans seem to have an in-built desire for fairness. There is that experiment where it's shown that people will pass up the chance to earn some money if they see the division of money as being unfair. The incredibly top heavy numbers in the American economy make clear that people are going to focus on the wealthy, especially as so many in the middle class make good incomes yet still struggle.

That said, I'm all for all of us looking at our own situation and seeing how good we have it compared to most of the world, and then seeing what we can do for others. I invite everyone to search up the Kiva thread here on FOFC and joining the group.

[JonInMiddleGA]

Originally Posted by DaddyTorgo

not sure if anyone actually HATES them.

I'm torn here.

I can't decide whether to go with "you're new around here, aren't you?" in tribute to Farrah's nice line earlier or "you don't get out much, do you?".

[SportsDino]

Hey I am doing my part to spread the hate!

I think you guys are all arguing statistical garbage. The recipe for success is not 1 parts rich dude, 11 parts other dudes, add salt and butter, stir...

What it really involves is preventing wealth concentration tactics that are harmful to the country, including:
- Golden parachutes, bonuses for failure make no sense for most corporations, they are prevalent because of the good old boy network, not because they serve a true competitive purpose.
- Low rates of taxes for capital gains/dividends, high rates of taxes on income (remember the FICA only went to 90K or so, maybe they've changed that now, I should check). This makes it harder to bridge the gap out of lower and middle classes into the upper class.
- Massive government subsidies to corporations. Most of this money is a redistribution from middle class (higher relative tax rate) to the wealthy.
- Bailouts, it saves the super wealthy who are supposedly getting such high returns for taking risks and being smart about it. Clearly they are not smart (why I hates them), and are not really taking much risk if the government covers their debts.
- Overly complicated and useless regulations which mostly are used to strangle off small businesses from becoming big businesses. Often these laws are the last resort of a big business to kill off a rising company (that they cannot buy, and usually relegated to those areas which have complicated and useless regulations which you would be surprised how many exist. Every time a seemingly dumb law is in the books you can bet some connected interest put it there to knock out a small time competitor at some point).
- Insistence that employees should bear the brunt of every companies hardships, but are usually the last to receive money during a boom. If I read one more story about people cutting their pay or hours to help a coworker during this crisis while I know their executives have just cleared multiple millions in bonuses while running the company into the dirt, I will scream!
- More and more taxes/fees on anything and everything everyone does instead of ticking up a percentage point on the multi-trillion dollar pile controlled by a few wealthy individuals and corporations. A pile that despite complete and abject stupidity and failure, is going to GROW by quite a bit this year.
- Finally, its nice to know so many people have had their savings obliterated while the usual suspects who were managing said savings are pulling in reasonable (if not all time record) numbers. Yay, 401k = safety net for the big money (crash wiped out about 0.5 to 1.0 TRILLION in net 401k dollars by my rough guesstimate, I need to data mine the FED and government reports probably to get an exact number, this is just eyeballing and guessing by way of linked stats). My concern is the stock market is going to outright gaming of the 'dumb money' in the market to make up the difference, which makes sense in a cruel cruel capitalist world, but is why I am paranoid as hell and warn people to control their own accounts with an iron fist.


I could continue ranting, but the point is who cares about whether a billionaire has 1 billion or 2 billion, all I care about is the mechanisms they are using to go from 1 billion to 2 billion. If they build the next Microsoft and create thousands of jobs, yippee. If they steal a billion dollars out of grandmas life savings (I've seen stats that despite what you think about people automatically reallocating assets as they age, that the crash wiped out from 20 to 30% of wealth of people nearing retirement, not all people, as the average person is actually WORSE), it makes me want to break out the pitchforks.

I can probably game old grannies if I had a U.S. backed 'trusted' institution like Citigroup and make money too. Not a very useful skill for economies, very useful for getting filthy rich. Which is why I hate the excessively rich by default and make case by case exceptions.

[JonInMiddleGA]

Originally Posted by SportsDino

Hey I am doing my part to spread the hate!

I'll play, but only for a minute, I gots other stuff to do. Besides, we can broadly agree on at least a couple of points (bailouts & subsidies primarily).

- Golden parachutes, bonuses for failure make no sense for most corporations, they are prevalent because of the good old boy network, not because they serve a true competitive purpose.

BFD, if it's their money, it's really none of anyone else's business what they do with it. I'd sooner they spend it on strippers than the government redistribute it to another batch of crack whores.

Insistence that employees should bear the brunt of every companies hardships, but are usually the last to receive money during a boom. If I read one more story about people cutting their pay or hours to help a coworker during this crisis while I know their executives have just cleared multiple millions in bonuses while running the company into the dirt, I will scream!

Scream if it makes you feel better, but it does little to change the reality that the average employee at the average company is not only easily replaced but also damned lucky to have the job at all as often as not they could be downsized without the company noticing any real loss in productivity.

Which is why I hate the excessively rich by default and make case by case exceptions.

There's no such thing as excessively rich.

[molson]

Originally Posted by SportsDino

Hey I am doing my part to spread the hate!

I think you guys are all arguing statistical garbage. The recipe for success is not 1 parts rich dude, 11 parts other dudes, add salt and butter, stir...

What it really involves is preventing wealth concentration tactics that are harmful to the country, including:
- Golden parachutes, bonuses for failure make no sense for most corporations, they are prevalent because of the good old boy network, not because they serve a true competitive purpose.
- Low rates of taxes for capital gains/dividends, high rates of taxes on income (remember the FICA only went to 90K or so, maybe they've changed that now, I should check). This makes it harder to bridge the gap out of lower and middle classes into the upper class.
- Massive government subsidies to corporations. Most of this money is a redistribution from middle class (higher relative tax rate) to the wealthy.
- Bailouts, it saves the super wealthy who are supposedly getting such high returns for taking risks and being smart about it. Clearly they are not smart (why I hates them), and are not really taking much risk if the government covers their debts.
- Overly complicated and useless regulations which mostly are used to strangle off small businesses from becoming big businesses. Often these laws are the last resort of a big business to kill off a rising company (that they cannot buy, and usually relegated to those areas which have complicated and useless regulations which you would be surprised how many exist. Every time a seemingly dumb law is in the books you can bet some connected interest put it there to knock out a small time competitor at some point).
- Insistence that employees should bear the brunt of every companies hardships, but are usually the last to receive money during a boom. If I read one more story about people cutting their pay or hours to help a coworker during this crisis while I know their executives have just cleared multiple millions in bonuses while running the company into the dirt, I will scream!
- More and more taxes/fees on anything and everything everyone does instead of ticking up a percentage point on the multi-trillion dollar pile controlled by a few wealthy individuals and corporations. A pile that despite complete and abject stupidity and failure, is going to GROW by quite a bit this year.
- Finally, its nice to know so many people have had their savings obliterated while the usual suspects who were managing said savings are pulling in reasonable (if not all time record) numbers. Yay, 401k = safety net for the big money (crash wiped out about 0.5 to 1.0 TRILLION in net 401k dollars by my rough guesstimate, I need to data mine the FED and government reports probably to get an exact number, this is just eyeballing and guessing by way of linked stats). My concern is the stock market is going to outright gaming of the 'dumb money' in the market to make up the difference, which makes sense in a cruel cruel capitalist world, but is why I am paranoid as hell and warn people to control their own accounts with an iron fist.


I could continue ranting, but the point is who cares about whether a billionaire has 1 billion or 2 billion, all I care about is the mechanisms they are using to go from 1 billion to 2 billion. If they build the next Microsoft and create thousands of jobs, yippee. If they steal a billion dollars out of grandmas life savings (I've seen stats that despite what you think about people automatically reallocating assets as they age, that the crash wiped out from 20 to 30% of wealth of people nearing retirement, not all people, as the average person is actually WORSE), it makes me want to break out the pitchforks.

I can probably game old grannies if I had a U.S. backed 'trusted' institution like Citigroup and make money too. Not a very useful skill for economies, very useful for getting filthy rich. Which is why I hate the excessively rich by default and make case by case exceptions.

Great post. This is the kind of hate for the rich I can appreciate and even get behind (almost). It's reasoned, and you make actual points.

[Autumn]

Originally Posted by SportsDino

I could continue ranting, but the point is who cares about whether a billionaire has 1 billion or 2 billion, all I care about is the mechanisms they are using to go from 1 billion to 2 billion. If they build the next Microsoft and create thousands of jobs, yippee. If they steal a billion dollars out of grandmas life savings (I've seen stats that despite what you think about people automatically reallocating assets as they age, that the crash wiped out from 20 to 30% of wealth of people nearing retirement, not all people, as the average person is actually WORSE), it makes me want to break out the pitchforks. .

Great points, they illustrate the point above, which is what I was trying to say. It doesn't matter how much money someone has, but how they came to have it. And you point out a lot of ways that the ultrarich have come to have their money that are not "earning it".

[molson]

Originally Posted by Autumn

Great points, they illustrate the point above, which is what I was trying to say. It doesn't matter how much money someone has, but how they came to have it. And you point out a lot of ways that the ultrarich have come to have their money that are not "earning it".

What if a middle class person gets money they don't "earn"? Is that a problem?

I guess the obvious answer to that, if it's a problem, is to wipe out inheritence rights. And again, that's an interesting idea, if that's actually your idea. But it seems like you're just poking holes.

I agree that generally, capitalism works better if people earn their money. That's kind of the spirt of capitalism in the first place - let's make people earn their wealth, not leave it to a corrupt government to distribute it. That requires the right regulations, and the right aggressive fraud prevention and prosecution. I don't know that it requires the kind of things that would be necessary to move our wealth disparity to European levels though.

[Autumn]

Originally Posted by molson

What if a middle class person gets money they don't "earn"? Is that a problem?

I guess the obvious answer to that, if it's a problem, is to wipe out inheritence rights. And again, that's an interesting idea, if that's actually your idea. But it seems like you're just poking holes.

I agree that generally, capitalism works better if people earn their money. That's kind of the spirt of capitalism in the first place - let's make people earn their wealth, not leave it to a corrupt government to distribute it. That requires the right regulations, and the right aggressive fraud prevention and prosecution. I don't know that it requires the kind of things that would be necessary to move our wealth disparity to European levels though.

I'm not much talking about inherited wealth. I'm talking about those regulations and fraud prevention and the many things that SportsDino mentions above. I think I can rest easy saying we're not there yet on having the "right" things. Am I the one who can figure out what the right ones are? Nope. But the symptoms seem clear to me that we're not there yet.

[Autumn]

Originally Posted by molson

What if a middle class person gets money they don't "earn"? Is that a problem?

Sure. But I think you've found the reason why you're seeing much more venom for the rich. How many middle class people are "gaming the system" and for how much money? Middle class people aren't the ones gaining those "benefits" that SportsDino mentions. When that business makes money by squeezing the pension of its workers, it's the middle class that pays for that wealth, generally.

[Farrah Whitworth-Rahn]

Originally Posted by Autumn

When that business makes money by squeezing the pension of its workers, it's the middle class that pays for that wealth, generally.

And the support you have for this assertion is...?

[Autumn]

I think it's logically clear. If the company saves money by reducing workers' pensions, the workers lose money, the company gains money.

[RomaGoth]

Originally Posted by molson

I agree that generally, capitalism works better if people earn their money. That's kind of the spirt of capitalism in the first place - let's make people earn their wealth, not leave it to a corrupt government to distribute it. That requires the right regulations, and the right aggressive fraud prevention and prosecution.

See, and this is where the problem of human nature kicks in. While we may want things to be fair and balanced, I would wager that the majority of us, when faced with a dump truck of money, would rather keep it than give it away to those less fortunate (yes, there is always someone less fortunate than you, it just depends how you define fortunate).

You are correct, capitalism does indeed work better if people earn their money. Unfortunately, this is not how it always happens. Back to my point of human nature though. The more money we get, the more we want. Those that we deem as rich, obviously do not want to share with those less fortunate (there is that word again). This means that they will do whatever is in their best interest to improve their situation, or at the very least to keep it as is. I believe this is where a lot of the perceived hatred for the rich comes into play. Throughout history, we have seen that those with money have tried (usually with success) to keep those without money down.

The ones with money have the power, and this is where the problem really lies.

[Farrah Whitworth-Rahn]

Originally Posted by Autumn

I think it's logically clear. If the company saves money by reducing workers' pensions, the workers lose money, the company gains money.

It is not logically clear that workers are middle class. You just assume they are. That's a big bit of stereotyping there.

[Autumn]

Originally Posted by Farrah Whitworth-Rahn

It is not logically clear that workers are middle class. You just assume they are. That's a big bit of stereotyping there.

I wasn't really creating some test scenario, I was just pointing out a very general example. In my example the workers were middle class, with pensions. Nowadays I suppose it would be hard to find a lower class person who had a pension.

Clearly the rich have tools to concentrate wealth that the middle and lower classes don't have, that's what i was saying. And that goes part way of explaining to Molson why people are concentrating on the rich and not the middle class. There's not much the rest of us can do that affects the concentration of wealth one way or the other, except affect policy somehow I suppose.

[Cringer]

If I ever meet an ultra-rich person I will let you know if I hate them after the fact.

[SportsDino]

My issue with Golden Parachutes is that it is not the exec's money, it is shareholders (yes that group has some overlap). In my opinion the shareholder oversight part of the corporate world is broken, they are overpaying what I consider to be replacement level executive talent. You can argue the execs are the majority shareholders, but maybe that is why they suck so much at their jobs since they have no accountability (my opinion).

I don't want the money redistributed to the government, I think that is half the problem. I want it put towards making more money, whether it is factories, jobs, or positive executive incentives like targets based bonuses (i.e. I'd rather give out a 50 million dollar bonus if they hit a X% growth or something target, than ten 5 million golden parachutes). Golden parachutes are for the most part a failure bonus, suck enough and we pay you to leave... wrong direction in my mind.

-----

I understand labor is easily substituted for, my concern is that what I consider the unproductive individuals in a firm are being increasingly compensated and sheltered in a hands-off, don't wanna hurt the 'talent' sort of way. Even worst now that the government has gotten into the business with bailing out some of the critically incompetent top dogs. These are people who sat on their hands while their market share drops 5, 10, 20 percent... instead of adapting like they are paid millions to do. When they failed to save that billion dollars of revenue, they are still paid, but then they pull out the threats on the productive people (though substitutable) to chop a billion out of the company.

Do they have the power, yes, but are they using it responsibly, or more importantly, profitably? In my opinion no. I also object to the factor where the villain is rewarded excessively while everyone else is feeling the pain. I have lots of respect for the executives that cut their pay when productive jobs were in peril. Productive meaning that the job contributes to revenue, I'm a ruthless advocate of cutting any job that has less benefit than cost, but its not all pure waste being cut. A lot of job cuts come down to 'you generate X revenue, but we have Y short term expense target, sorry'.

I consider if you are going to cut down expenses, you start with the most expensive mistakes first, then work your way down, thats all. The reason it doesn't happen is because of all the inbreeding that happens at the top of these organizations, are you going to fire Cousin Billy Bob even if he is getting a 3 million dollar bonus, and despite the fact that he botched 3 out of the last 5 decisions you asked him to make (and the other two were probably routine)? Maybe, but if he is tied to your network designed to keep your CEO position at all costs? Hell no.

The assumption that corporate leadership is trying to maximize shareholder value is assuming too much (a pretty intricate debate, but it comes down to individual risk of person's power weighed against net gain of the company, there is almost always some efficiency loss because of this, because it logically makes sense you are seeking to maintain your CEO position). The game is much too complicated, and once that assumption fails completely most of the jargon thrown out by politicians/business/pundits starts to unravel. If companies do not maximize wealth, a tax cut may not lead to increased investment (it can even decrease it). A subsidy might be pocketed. An executive might sell off corporate assets for a dime on the dollar. An insurance giant may post a monumental multi-billion dollar loss, on purpose! (Someone should really write a book on the true game of the AIG explosion)

The idea that the private sphere is inherintly rational or efficienct is incorrect, in fact I argue as it increasingly resembles government we are getting in deeper trouble.

All this to say that I am still offended by exec bonuses while the ranks are expected to sacrifice. And while those ranks are easily substituted (although it has expenses and it would be interesting if people started to call the bluff), I argue that not only are these same execs replaceable, but in many instances for the sake of sanity and getting filthy rich, many of these executives should be replaced.

[Galaxy]

Are we painting the rich as people who don't "earn" (such as lying, fraud) their wealth ratherly broadly? We do have scumbags like the Madoffs and Ken Lewises. However, the percentage of those people in the wealthy group can't be that big.

Also, are we confusing the rich with corporations/companies in terms of public CEOs?

[molson]

Originally Posted by Galaxy

Are we painting the rich as people who don't "earn" (such as lying, fraud) their wealth ratherly broadly? We do have scumbags like the Madoffs and Ken Lewises. However, the percentage of those people in the wealthy group can't be that big.

Also, are we confusing the rich with corporations/companies in terms of public CEOs?

Ya, it seems like the appropriate response to the super-rich that don't "earn" their money is to more aggressively investigate, prosecute, and punish them when they commit crimes. Or even expanding the definition of criminal conduct in some contexts. So why isn't THAT the target, why is the group as a whole considered the problem? The honest achievers are still counted in those wealth disparity tabels.

[Autumn]

I think there are those who have committed fraud, etc. But then there are complaints about the system which has produced their wealth. These aren't questions of fraud and lies, it's just a question of what do we want the priorities of *our* regulatory system to be? Wealth is produced not just by people's work but by how the society chooses to handle it legally and financially.

[molson]

Originally Posted by Autumn

Wealth is produced not just by people's work but by how the society chooses to handle it legally and financially.

It's that choice just, "I want money, he has it"?

So the ones with the money become the bad guys, kind of by default of human nature.

Edit: Farrah said it better. If someone ELSE has money, more than me - there MUST be something wrong with the system!!!

Since the rich are "someone else", from the perspective of most, they're money holding is by default, wrong.

But again, we're all rich in America. It's just the rich complaining about the richer.

That being said, of course, the poor and middle class can do what they can to try get the money from the rich, either through democracy, civil unrest, or their own achievment. I just don't think there's an inherent evilness at play in the equation.

[Farrah Whitworth-Rahn]

Originally Posted by Autumn

Wealth is produced not just by people's work but by how the society chooses to handle it legally and financially.

FALSE.

Wealth is PRODUCED by work. You produce nothing, there is no wealth created. Regulatory framework produces nothing, and in fact retards the production of wealth.

[SportsDino]

My point is that it doesn't even matter whether the person earned the billion dollars. I'm not all that offended by an inheritance in the billions. I assert that if we want a functional economy we must make all reasonable effort to prevent theft and exploitation. This means enforcing somewhat hard things to enforce like front running, insider sales (or worst manipulation), or an investment bank using its general pool (say mutuals, grannies funds, creatively-backed assets) to offset losses to its hedge fund clients.

I'm not even asking for an arms race, or loophole wars. I want to go a different direction, make everything for public companies... public! Encourage public investment only in full disclosure companies, and anyone who doesn't want to play doesn't get invited to the party. A natural ecosystem will spring up to process and distribute that information, and the ironic side effect is despite all the crybaby behavior you will see up front by the schemers, the net effect more closely aligns with pure capitalism, and you will see massive success stories and efficiency increases as people adapt to the new bandwidth (think invention of the internet magnitude effect on the economy). Once we have a more vicious and true analysis based financial world instead of the country club elitism, a person will be able to truly invest instead of just gamble.

No opaque balance sheets and other annual/quarter reports are not full disclosure, I run crazy amounts of custom made software to try and reverse engineer the internals of a company from their public information (notice its always subject to later modification and time shifting of cash flows makes it a computationally impossible problem against a company truly dedicated to cooking the books).

Anyway, you prevent abuse and you align the incentives of wealth back towards creating it through productivity and goods. Then it doesn't matter whether I leave my billions of dollars to my kids, charity, the government, or strippers... the economy will function. Not everyone will have champagne and caviar, but you will see a natural deconcentration of wealth, but more importantly, it is because it is merely accompanying a massive increase in the net total wealth available in the country (only possible through technology, goods, standard of living, and population growth... wealth is not a zero sum game unless you only look at ratios which are mostly useless).

That is the best possible case for decreasing inequity gap, often the fastest growing times in terms of wealth creation (real dollars) is accompanied by increased wealth spread, because most of the growth comes from increase standard of living from a 'middle class' (and with it the accompanying net spending increase that boosts the already wealthy to super wealth). This is why I inevitable digress towards my old argument that the best game for the super rich is to grow the pie and pay for more people to get to work. More workers generally equals more shoppers, and while you can screw it up (paying too much for no benefit = waste), it is generally the story of America's ascendancy.

[Farrah Whitworth-Rahn]

Originally Posted by SportsDino

My point is that it doesn't even matter whether the person earned the billion dollars. I'm not all that offended by an inheritance in the billions. I assert that if we want a functional economy we must make all reasonable effort to prevent theft and exploitation. This means enforcing somewhat hard things to enforce like front running, insider sales (or worst manipulation), or an investment bank using its general pool (say mutuals, grannies funds, creatively-backed assets) to offset losses to its hedge fund clients.

I'm not even asking for an arms race, or loophole wars. I want to go a different direction, make everything for public companies... public! Encourage public investment only in full disclosure companies, and anyone who doesn't want to play doesn't get invited to the party. A natural ecosystem will spring up to process and distribute that information, and the ironic side effect is despite all the crybaby behavior you will see up front by the schemers, the net effect more closely aligns with pure capitalism, and you will see massive success stories and efficiency increases as people adapt to the new bandwidth (think invention of the internet magnitude effect on the economy). Once we have a more vicious and true analysis based financial world instead of the country club elitism, a person will be able to truly invest instead of just gamble.

No opaque balance sheets and other annual/quarter reports are not full disclosure, I run crazy amounts of custom made software to try and reverse engineer the internals of a company from their public information (notice its always subject to later modification and time shifting of cash flows makes it a computationally impossible problem against a company truly dedicated to cooking the books).

Anyway, you prevent abuse and you align the incentives of wealth back towards creating it through productivity and goods. Then it doesn't matter whether I leave my billions of dollars to my kids, charity, the government, or strippers... the economy will function. Not everyone will have champagne and caviar, but you will see a natural deconcentration of wealth, but more importantly, it is because it is merely accompanying a massive increase in the net total wealth available in the country (only possible through technology, goods, standard of living, and population growth... wealth is not a zero sum game unless you only look at ratios which are mostly useless).

That is the best possible case for decreasing inequity gap, often the fastest growing times in terms of wealth creation (real dollars) is accompanied by increased wealth spread, because most of the growth comes from increase standard of living from a 'middle class' (and with it the accompanying net spending increase that boosts the already wealthy to super wealth). This is why I inevitable digress towards my old argument that the best game for the super rich is to grow the pie and pay for more people to get to work. More workers generally equals more shoppers, and while you can screw it up (paying too much for no benefit = waste), it is generally the story of America's ascendancy.

I find it amazing that people in this country actually think wealth is some finite amount and too much of it is being hoarded.

This is America. In this country, if you work hard and make smart choices you will be wealthy. Sure you may have to make sacrifices, your choices may be between the lesser of two evils but everyone here is given the same opportunity to make something of their lives. No one is born into bondage in this country anymore. If you want to run a huge Fortune 100 company, you can...if you have the courage to work for it.

It disappoints and saddens me that people would rather take from those who do have the courage under some misguided sense of "fairness" and "protection those from being exploited", rather than encourage people to work hard and make smart choices.

I guess it's just easier to take.

[SportsDino]

Farrah is pretty much hit it with "Wealth is PRODUCED by work."

Finance does not create wealth except when it finances investment that leads to something being produced that makes someone's life better. This is why I generally have railed against the unbridled growth of derivatives, which are all based on zero sum wealth redistribution, and only have value when they are appropriately set against risks in the production economy. I.e. the classic derivative of an oil future, simplifying the price and distribution of oil which is subject to numerous physical sources of disruption (supply breakdowns, hurricanes destroying refineries, more buyers than sellers on a specific day, etc).

Similarly a regulation can not create wealth, by fiat the government may print money, but in so doing it merely increases the theoretical amount of dollars per good by an equal amount. Now there is some information gap theory involved here, if you give everyone a newly printed $100 bill they certainly feel richer, and don't truly notice the inflationary impact psychologically, but the impression of creating wealth does not really create wealth. And pursued to excess you end up with Wiemar Germany.

However, regulation of criminal activity can prevent behaviors that retard the growth of wealth. For instance, allowing a company to assinate the CEO of a new rising company is clearly bad for overall economic growth. All Bill Gates would need to do in such a world was to have strangled Steve Jobs when it was convenient. So clearly, we don't allow killing business rivals. Similarly we shouldn't allow other behaviors that are wrong, even if they involve subtle economic analysis to understand just how bad they can be.

In my opinion, we could do with some regulation. But those laws should be of the form of 'thou shall not do extravagant manipulation A that results in embezzling funds from your own corporation' and not of the form of 'thou shall not make more than 1 billion a year as CEO of your company if you take government funds'. The latter is at best a bandaid, and in reality a bullshit tactic to look like you are doing something while you help said CEO loot the company for all its worth (see GM stock redistribution after about 5-10 years and I guarantee you will see a scandal that no one will ever mention).

The argument that government is always bad is wrong, although I must say that most specific arguments about why government is bad are usually right. I learned as a kid the government does not promise equal outcomes, it should and needs to do a better job of, promising equal rights and protections.

[Farrah Whitworth-Rahn]

Originally Posted by SteveBollea

So, do you think those in the top 1% work 100 times harder now or are those in the middle class 100 times more lazy than they were forty years ago?

C) Both. How many in that top 1% ever really stop working? The various CEOs and high net worth individuals I've worked with and for are working every waking moment. They are on call 24/7, and are never on vacation. How much of the middle class works like that? If they are, and are still middle class...well that goes back to my statement about making good choices. If you're working 24/7 and you're still middle class, are you really making good choices?

I also think the nation as a whole, not just "middle class", has gotten more lazy in the pasty 40 yeas. People expect things to be given to them more now than ever before. The healthcare debate going on in this country is a perfect example.

Originally Posted by SteveBollea

As far as taking goes, it you want to call making a nation that nobody has go into debt $50,000 to finish college or that no one ever goes bankrupt because they get sick again via taxation so that somebody making 20 million only is able to put say, 8 million in the bank, so be it.

I'm not sure what you're saying here.

You can go to college and not rack up $50k in debt to do so. You may not get to go to Harvard, but that's the choice you have to make, yes? Why should I pay, via someone taking the money I work very hard for in the form of my taxes... so that you don't have to make the same choice and sacrifices that I did?

Now, if you'd like to give me the power to make your choices for you, then I'd be happy to write a check to the government.

[JediKooter]

Originally Posted by Farrah Whitworth-Rahn

I find it amazing that people in this country actually think wealth is some finite amount and too much of it is being hoarded.

This is America. In this country, if you work hard and make smart choices you will be wealthy. Sure you may have to make sacrifices, your choices may be between the lesser of two evils but everyone here is given the same opportunity to make something of their lives. No one is born into bondage in this country anymore. If you want to run a huge Fortune 100 company, you can...if you have the courage to work for it.

It disappoints and saddens me that people would rather take from those who do have the courage under some misguided sense of "fairness" and "protection those from being exploited", rather than encourage people to work hard and make smart choices.

I guess it's just easier to take.

I have to agree with Farrah here on this.

There is no one holding anyone back from attaining the 'wealth' that you want other than yourself. Sure, being born into a well to do family helps, but, if you're an idiot and blow all of the money, what good does that do? One of my dads best friends started out as the janitor for a company over 30 years ago...he retired as the president of the company and now is very very well off. Yeah, it took a few years, but, he earned it. It can be done, but, it isn't something that's going to happen over night.

I think there is too much of a 'I want it now' attitude or 'how come they get to but I don't?' whining in this country. "Everybody" wants to be rich, but, not "everybody" wants to put the blood, sweat and tears to get it and they just want it handed to them instead. Nope, instead, they want to penalize the people who are rich (in the monetary sense) because of really, no more of an argument than, "It's not fair." The whaambulance is on its way to pick you up.

That's my opinion and I'm sticking to it.

[SportsDino]

I don't think the 20 million dollar guy needs any help either. But I don't think you can 'tax away' the problem. If anything willy nilly government spending among other interference has done its part to contribute to increased education and health care pricing.

More college graduates unfortunately won't create jobs anyway. As Jon said, most employees can be replaced, all we are doing is pumping the supply and crashing the market. Hell, you bring up 20 million dollar guy, that is a heck of a lot closer to me than to your Madoff's or your average Forbes lister. If you take me from 14 million after taxes to 8 you are doubling the tax rate (that is 40% already by the way), and since my goal is building a giant ass company to give you a job (and statistically I'd be more likely to do so than your average Forbes member).. you just doubled my timeline before I could even get started.

So this is a prime example of 'everyone richer than me' is the enemy thinking. We shouldn't be thinking about wealth lines and tax rate games to make things 'fair', because your line and your suggested rate just kills half the economic growth in this country, and probably 90% of the growth most likely to give your $50K college debt a job!

Where the tax wars lie to me is when states make a new sales tax of say 5% to cover their budget, which could be settled by a .25% tax on the billionaires. Rationally that is unfair, you litterally are making poorer people share a larger ratio of the pain when they are the least capable of adapting to it... so I would of course say go with the 0.25% despite it hurting me since it really makes sense for public policy. This is why we have progressive tax systems. But anything to excess is stupidity, we should focus on making the fundamental nature of our economy work. That doesn't mean standing aside and let the banks run amuck either (they have done enough damage), but it sure as hell does not involve relying on tax distribution to solve a problem that requires actual thinking.

[JediKooter]

Just throwing this out there: More jobs = larger tax base...

[molson]

Originally Posted by JediKooter

Just throwing this out there: More jobs = larger tax base...

Also, more billionaires = larger tax base.

[Farrah Whitworth-Rahn]

Originally Posted by SportsDino

More college graduates unfortunately won't create jobs anyway. As Jon said, most employees can be replaced, all we are doing is pumping the supply and crashing the market.

There was an article in the paper the other day about Arizona spending "stimulus" money on job training programs for the unemployed. Throughout the article all I could think was "training for what jobs? I thought there weren't any?". The article didn't say either.

Originally Posted by SportsDino

Where the tax wars lie to me is when states make a new sales tax of say 5% to cover their budget, which could be settled by a .25% tax on the billionaires. Rationally that is unfair, you litterally are making poorer people share a larger ratio of the pain when they are the least capable of adapting to it... so I would of course say go with the 0.25% despite it hurting me since it really makes sense for public policy.

I think this is bad policy, as the tax base is narrow and the state would be relying on the fortunes of one or two people to cure its ills. Imagine the state that assessed that tax on John McAfee. They'd be screwed right now.

[JediKooter]

Originally Posted by molson

Also, more billionaires = larger tax base.

Ah yes, that too. Good point.

[Arles]

Originally Posted by SteveBollea

So, do you think those in the top 1% work 100 times harder now or are those in the middle class 100 times more lazy than they were forty years ago?

I think sports are the best analogy here. Take Albert Pujols and Craig Counsell. Almost everyone who has played with Craig (Florida, Arizona, Milwaukee and others) say he has a fantastic work ethic. He has had a solid career and makes an average MLB salary (maybe a little higher). Pujols makes a lot more money, but doesn't necessarily work any harder. He is simply more talented (or better suited) to have success in baseball. But, since he has gained so much more than other hardworking players, does that mean we need to give him an "anti-coordination" drug so that he hits .260 next season? After all, it isn't "fair" that he makes so much more than Counsell despite the fact that he doesn't work any harder.

I doubt many on this board (outside of Cubs fans) would want to take the above approach to Pujols, but that's exactly what many want to do to the "super rich".

In this world, there are some hard-working, honest and smart people who will not make a ton of money. Just like there are some complete douchebags who will make millions. But the fact remains that if you work hard, have passion and aptitude for what you do and are willing to make certain sacrifices, you have a much better chance at wealth/success than someone who doesn't. It's no guarantee, but it's about the best we can hope for and certainly something our government should support. So, I don't see the reason to group "the rich" as an enemy anymore than grouping "engineers" or "text sim developers" (most of which certainly aren't rich ).

[Farrah Whitworth-Rahn]

Originally Posted by Arles

I think sports are the best analogy here. Take Albert Pujols and Craig Counsell. Almost everyone who has played with Craig (Florida, Arizona, Milwaukee and others) say he has a fantastic work ethic. He has had a solid career and makes an average MLB salary (maybe a little higher). Pujols makes a lot more money, but doesn't necessarily work any harder. He is simply more talented (or better suited) to have success in baseball. But, since he has gained so much more than other hardworking players, does that mean we need to give him an "anti-coordination" drug so that he hits .260 next season? After all, it isn't "fair" that he makes so much more than Counsell despite the fact that he doesn't work any harder.

I doubt many on this board (outside of Cubs fans) would want to take the above approach to Pujols, but that's exactly what many want to do to the "super rich".

In this world, there are some hard-working, honest and smart people who will not make a ton of money. Just like there are some complete douchebags who will make millions. But the fact remains that if you work hard, have passion and aptitude for what you do and are willing to make certain sacrifices, you have a much better chance at wealth/success than someone who doesn't. It's no guarantee, but it's about the best we can hope for and I don't see the reason to group "the rich" as an enemy anymore than grouping "engineers" or "text sim developers" (most of which certainly aren't rich ).

Don't you have a game to get out? GBTW!

[Galaxy]

Originally Posted by SportsDino

Where the tax wars lie to me is when states make a new sales tax of say 5% to cover their budget, which could be settled by a .25% tax on the billionaires. Rationally that is unfair, you litterally are making poorer people share a larger ratio of the pain when they are the least capable of adapting to it... so I would of course say go with the 0.25% despite it hurting me since it really makes sense for public policy. This is why we have progressive tax systems. But anything to excess is stupidity, we should focus on making the fundamental nature of our economy work. That doesn't mean standing aside and let the banks run amuck either (they have done enough damage), but it sure as hell does not involve relying on tax distribution to solve a problem that requires actual thinking.

Would that be a wealth tax or an additional income tax on whatever they earn that year?

[Galaxy]

Originally Posted by Farrah Whitworth-Rahn

Don't you have a game to get out? GBTW!

He's checking out the hotties on Ashley Madison.

[Autumn]

Originally Posted by Farrah Whitworth-Rahn

FALSE.

Wealth is PRODUCED by work. You produce nothing, there is no wealth created. Regulatory framework produces nothing, and in fact retards the production of wealth.

I think that's oversimplifying it. Yes, on a societal scale wealth is provided by work. But the amount of wealth that a person ends up possessing goes through many, many layers of abstraction, financial arrangements, regulations and laws. I clearly have not been able to make this point clearly during this whole discussion, so I'll just bow out unless I think of a great way of describing it. But suggesting that Bill Gates's billions are directly correlated to the amount of wealth he has produced is simplifying it to the point of uselessness. If the value of the dollar changes, has the amount of wealth he's produced changed? No, but that's just one of the myriad things that goes into the calculation of how much wealth an individual has.

[Autumn]

Originally Posted by molson

It's that choice just, "I want money, he has it"?

So the ones with the money become the bad guys, kind of by default of human nature.

Edit: Farrah said it better. If someone ELSE has money, more than me - there MUST be something wrong with the system!!!

Since the rich are "someone else", from the perspective of most, they're money holding is by default, wrong.

But again, we're all rich in America. It's just the rich complaining about the richer.

That being said, of course, the poor and middle class can do what they can to try get the money from the rich, either through democracy, civil unrest, or their own achievment. I just don't think there's an inherent evilness at play in the equation.

I see that you really want to push this point, that people think people with more money than them are bad. But it really has nothing to do with what I'm saying, so please find someone else's comments to pin it on.

I do not think that it is wrong for someone to have more money than me. Can I put it any plainer than that? I don't want as much money as they have, but they're welcome to it. We have a society and a government which creates and defines the system of corporations, a tax structure, regulatory systems for business and labor and safety. I am a citizen of that country, so I have a stake in what that system is. That's my pony in this race.

We don't live in some Ayn Rand free market where people are just making money from the sweat of their brow. We live in a complex society and economy where we're all entangled. The way the system works affects me, and the billionaires and everyone else. And it's just that, a system. It's something we created and continue to create. I'm not talking about "tampering with the natural order of things" in order to deal with my dollar envy. I'm talking about taking part in making wise decisions about the maintenance of a system that exists, that is our creation and our responsibility.

[JonInMiddleGA]

Originally Posted by Autumn

I am a citizen of that country that's clearly envious of those who have been more successful so I want to use the system to fuck them over to make me feel better about myself.

Fixed that for you.

[Farrah Whitworth-Rahn]

Originally Posted by Autumn

We don't live in some Ayn Rand free market where people are just making money from the sweat of their brow. We live in a complex society and economy where we're all entangled. The way the system works affects me, and the billionaires and everyone else. And it's just that, a system. It's something we created and continue to create. I'm not talking about "tampering with the natural order of things" in order to deal with my dollar envy. I'm talking about taking part in making wise decisions about the maintenance of a system that exists, that is our creation and our responsibility.

It is truly unfortunate we don't live in an Ayn Rand free market, for in that market it is truly equality of opportunity and not equality of results. It's my version of a wet dream I guess.

In any event....I wholeheartedly agree with most of this statement. I like the system that exists and I think it should be maintained. I also agree those who participate in it should make wise and well reasoned decisions. The devil is in the details of course.

More regulations....How many more regulations would have prevented the Madoff fraud when the SEC was tipped off about the Ponzi scheme on multiple occasions going back as far as 1999? Not to mention the sophistication at which his fraud operation was structured....how would more regulations have caught that?

If more regulation is what you seek, better pay attention to Chuck Schumer and the move towards the EU style accounting standards known as IFRS and away from American financial accounting standards of GAAP. The regulations surrounding IFRS are about an inch thick. The regulations surrounding GAAP fill volumes.

[Autumn]

Originally Posted by JonInMiddleGA

Fixed that for you.

I gotta tell you, I'm fucking tired of these remarks. Just because I'm the one here discussing this with you guys doesn't mean I'm that bogeyman you're chasing who's envious of the rich.

I could have spent this entire thread simply making quips like that, but I tried having an actual conversation. And I thought I made pretty fucking clear that I don't give a shit who has money and who doesn't. If I was interested in being rich I'd be working a lot more than i am right now, instead of working part time and struggling to get by so I can be with my kids instead.

Stop painting me with your one color brush and actually listen, or leave me alone.

[Autumn]

Originally Posted by Farrah Whitworth-Rahn

It is truly unfortunate we don't live in an Ayn Rand free market, for in that market it is truly equality of opportunity and not equality of results. It's my version of a wet dream I guess.

In any event....I wholeheartedly agree with most of this statement. I like the system that exists and I think it should be maintained. I also agree those who participate in it should make wise and well reasoned decisions. The devil is in the details of course.

More regulations....How many more regulations would have prevented the Madoff fraud when the SEC was tipped off about the Ponzi scheme on multiple occasions going back as far as 1999? Not to mention the sophistication at which his fraud operation was structured....how would more regulations have caught that?

If more regulation is what you seek, better pay attention to Chuck Schumer and the move towards the EU style accounting standards known as IFRS and away from American financial accounting standards of GAAP. The regulations surrounding IFRS are about an inch thick. The regulations surrounding GAAP fill volumes.

I know a lot of you would like a more ideal free market. I'm not sure it's the best, but it's clearly not what we have. I think it's therefore misleading to act like everything that happens is due to market forces, that's all.

And no I dont really want "More" regulation. I'm talking about "different" regulation, if we actually wanted to change the way things are. obviously many don't, but I think it's clear that the regulation we have (and I use the term regulation loosely) contributes to the way things are.

[CamEdwards]

Originally Posted by Farrah Whitworth-Rahn

It is truly unfortunate we don't live in an Ayn Rand free market, for in that market it is truly equality of opportunity and not equality of results. It's my version of a wet dream I guess.

We really need to bring back QOTM.

[Farrah Whitworth-Rahn]

Originally Posted by Autumn

If I was interested in being rich I'd be working a lot more than i am right now, instead of working part time and struggling to get by so I can be with my kids instead.

There are ways to define rich that don't involve currency or balance sheets or fair market values....

[Autumn]

Not in this thread there aren't ;-)