Topic: What's wrong with unequal wealth distribution? (Was: 2013-12-10 Bitcoin Proves.. (Read 2992 times)

Well this is easy.

You just create a huge organization and arm it, pointy guns and steely knives, then tell them to go out and take things away.  After you take a lot of stuff away from people they are all equal, having nothing or the few things that it wasn't worth hauling off.

We could say the same about you, including your binary thinking.

Greed v.s. Cooperation. Are you saying you are amusing?
Why can't greed have cooperation? It could be many people cooperating to make lots of money. Like in large companies.

Why would people stop working?

Take the US for a case study, those who have unemployment tend to only actually get a job right before it runs out. Why WOULD they start working is the real question. In order to evenly distribute the wealth, you would have to make allowances for low-skill workers or people who are unemployable because of either their attitude, intelligence or physical ability, if that were the case, those who do not have a very big drive to make something of their own (which is most people) would simply try to find a way to take some of this easy money. Once they do, they take it because they can, and often work under-the-table to make up the difference between what they get handed and what they want.

The alternative is scary.

If you want to distribute wealth and won't take excuses, you must literally enslave the populace and put them to work on your terms (or the terms of whomever is in power) they would then be coerced to farm or do factory work (this is what happened in Russia during communism to a certain degree) and while they had some triumphs, the general effect was massive poverty, a large black market, corruption in high degree and the wealth being distributed mainly in the government and police.

In short, you CAN'T distribute wealth evenly by force, and when you even attempt it, the outcomes are so bad and history is so replete with examples, you must be a madman, evil or simply too stupid to understand history to attempt it.

they are not worth discussion, they wont open their mind

If everyone gets more to reasonable point everyone ends up with more, at least the vast majority that is 99% to 99.9%.

As I said it's not zero-sum game. In the end some people earn more, but everyone earning more means that majority spends more and spending means more money earned and better quality of live for everyone.

Why would anyone stop working?

Wealth distribution is just a data or a property of a system. I think most people are not speaking about giving everyone the same amount of money (it will never happen), but a shift from a greed oriented world to a cooperation and common good oriented world.

binary people are amusing.

If no one works, then who will grow the food crops? Who will patrol your town? Who will look after the public transportation and other facilities? It is bound to fail.

This is easy,

If wealth distribution were equalized, it would sink to a lower common denominator because once people rely on a set income their drive for wealth is extremely diminished and they don't work as hard, then eventually people starve... but hey it would be equal, so that's... good?

Economy isn't zero-sum game. So more equal wealth distribution in the end means that wealth the rich have has more power and can get more goods. And other hand it's also numbers game. 1 000 people spending 10 000 000 is less than 100 000 000 spending 10 000.

Most of the development has come from specialisation and without reasonable wealth distribution this can't happen.


So it's just question of how to get the money in hands of majority...

This.

Piff's argument explains how important it is not to brush off inequality. He also explains how a culture that emphasizes community, cooperation and compassion help in reducing the adverse effects of inequality.

That's not entirely true. A poor village that earns it's money by sewing shoes and clothes by hand going up a class may be the village installing machines that do that for them, and earns more money by producing more shoes and clothing in a safer and cleaner environment.  Or poor vilagers that can only manage to live by farming their plot of dirt by hand, can move up a class by going to work in phone support for wealthier class, and earn more money to buy more and cheaper food produced by the wealthier class's automated farming machines. Both have happened in China and India.

Here's an interesting Youtube video:
Paul Piff: Does money make you mean?

Sometimes people are stuck in a way that it is very hard for them to help themselves out of that situation, if people are at such a point and another person realizes it, as well as what needs to be changed to get out of the rut, it would make a better society if that person went out of his/her way to help out to make that change possible for the ones stuck in a rut. Simply throwing money at someone is not helping them, it might even make their problems worse.

What is often the case in social democracies is that people vote for politicians who then throw money at the needy, but the people who vote for those politicians are not willing to actually do something themselves. Often they are themselves incompetent as well and would have nothing to contribute with even if they wanted to.

Hence what is needed is a more collaborative culture so that the destitute are not left in that position, but helped to overcome their shortcomings.

what will this solve? the pyramid won't change like this. for everybody going up a class, somebody has to go down.

I'm all for 'teaching people'...

But what does that mean or imply, today and tomorrow, since in a short two decades virtually all information is available to anyone on the planet with a cheap internet access device?

I am quite serious with this question, not because there are many arguments to the contrary ("but the illiterate! the children! the homeless! those in areas with no internet access!) but because of the signficant comparable, which is the basic ready access to information say picking three datum:

1970
1995
2013

And yet other countries who have tried it: Denmark, Finland, Netherlands, Norway, Sweden, Switzerland are in fact low on crime, good on healthcare and health in general, low on social tensions, etc - all while being among the wealthiest countries in the world.

But that those countries have tried wealth re-distribution, and still manage to be in the top tier of a bunch of lousy countries (i.e. the West) is irrelevant because:

I didn't mention the word re-distribution at all - I said:



If you read carefully what I posted you will see that I am in fact criticizing re-distribution when I say that:


Actually, the most obvious example of how spectacularly wealth re-distribution can fail is international aid to poor countries. This has probably caused a lot more harm than good. But as mentioned, some countries managed to do it internally while not creating too much of a mess - this however does not mean that re-distributing wealth is an effective way of reducing inequality.

But that does not mean that inequality is inconsequential.

Great point. Nations which have tried wealth re-distribution (Cuba and North Korea, and more recently Venezuela and Bolivia) have failed miserably in removing the social and economic inequality. They just ended up with ruined economies. This is a failed idea. Why we should retry it?

First, you have absolute poverty. I think it can be subdivided into two categories: (1) getting enough food and water to be able to survive another day (probably around $1-$2 a day); (2) getting varied and healthy food, access to the means to achieve that like a fridge, having electricity, having electric lighting, having time-saving devices like a washing machine, having Internet access and a basic computer and finally having a shelter for the weather.

We can all agree that people not having (1) is a big problem in and off it self, no matter if it is a symptom of something else. (2) is in my opinion about where everybody needs to be to be able to eliminate absolute poverty completely.

When it comes to relative poverty, or income inequality apart from absolute poverty, it is a whole different discussion. I definitely think there are a number of things that are wrong with society that end up causing gross wealth inequality. But sometimes the symptoms themselves can kill you, and in such cases one needs to treat the symptoms first before one can fix the root cause. I think that gross inequality causes absolute poverty, crime, loss of opportunity and a negative feedback loop. In other words, one of the causes of gross wealth inequality can be wealth inequality in itself.

So I do not reject that one should find the root problems in society and tackle them, I'm saying that we cannot ignore glaring inequality, simply because it causes too many problems.

Now on to the root problem. I think what we are talking about here is culture. People in general need to have a more cooperative culture. I'm not saying that healthy competition is bad, I'm just saying that if you play football (soccer) and while dribbling your opponent falls down, the right thing to do is to help him/her up, make sure they are okay and continue playing trying to win - kicking your opponent while down might help you win the competition, but it is not part of a culture that is beneficial in the long term.

Translating this to a real life situation, one can see that if someone is having problems, people having an ideal culture will try to help. But this is where most people (and NGOs and governments) fail badly - giving them a free lunch is just likely to make them dependent on you, you would actually not be helping them at all. What you need to do is educate them, teach them the skillsets they need to take themselves out of their hardship, thus creating a positive feedback loop for them. However, the further down someone is, the harder it is to teach someone the right skillsets - in these situations one needs employ the best teaching methods for teaching hard lessons: tricking them into realizing by themselves how to improve.

My point is that if one really wants to tackle the evils of the world, starting by teaching people how to resolve their misery and better their life as a means of reducing inequality is a great way to do it.

perhaps because it's the first time they are getting consciousness that they don't have to accept the value of "gold" (wich is BTC in that case)? i'm asking, because i don't know; i'm still thinking about all this. all i know is that you can't compare virtual currencies to fiat neither gold. why has gold value for everyone? because everybody told them it has, their whole life. now with Bitcoin everybody gets the chance to "think" for the first time. and this time we have the internet.
i'm still brainstorming about all this

I would not be surprised that 5% owns 95% of all gold bars. Probably of all gold in existence. This 5% mostly uses it as store of value, and to trade amongst themselves. Does this mean that 95% do not want to have gold, too? Would you not want receive any gold as payment? Since you know this 5% accepts this currency, and they also likely own many of the biggest businesses, why would workers not take it, if they know they can use it to buy anything they want from 5%? There is higher chance the 5% will not take some currency that 95% make, than 95% not taking currency that 5% have. Richard Branson is now taking bitcoin, and many rich still have gold, but no rich person takes Fureai Kippu or Ithaca Hours.

here is where the revolution is, they are not forced to use "their" currency anymore




ok, if only the 5% that own 95% of the coins accept them as value, they wont be able to pay their workers with it, they wont be able to buy any product of "the other 95%"

I did not understand because I did not understand your english. Who is it that you call "they" and "them", and why is slaves and bread involved? Please to be more specific.

Also, it would be pretty bad if you did not understand what you yourself have said. So I am glad that you understand what it is that you said that we did not understand. Hopefully you can explain it to us too.

40% of the USD is owned by 1% of the population. So has the remaining 99% abandoned it in favor of a new currency? No. Will the same doomsday scenario happen to BTC? My answer is NO.

You don't even understand Bitcoin.

even worse that i understand that(why) you guys don't understand

You're not alone

I do not understand.

'cause they can't pay them "slaves" nor "bread"

If rich value them and use them to trade, why would they be useless? Can you trade 1 kilogram bars of gold? No. But I bet you wish you could.

cryptasm is the man

i wanted to respond the topic but someone on facebook fed me with new thoughts, so my quickresponse to that question: " What's wrong with unequal wealth distribution?" is: If you ask that you have to study: history (focus on colinalism), sociology and ethics



so here is my new food for thoughts:

once BTC is dominant currency, and 95% of BTCs are in the hand of 5% of world population. why would those 95% who got the rest stay with Bitcoin? they will abandon it and simply adopt another coin, wouldn't they? BTC will have only value between the richs, which would make them useless.
(just beginning to think about this, a guy on facebook gave me that "food" 10min ago; sharing this "food" with you guys)

Yes in most cases I think that's true. It doesn't matter if you're the CEO of Dow Chemical who poisoned thousands of people in Bhopal or the multi-millionaire CEO of some charity, there is no need to accumulate such ridiculous amounts of wealth. People should be rewarded for hard work, if that were the case, all of the slaves working 60 hours a week @ $2 a day to make our clothes/consumer goods/food etc would be relatively wealthy. US Macdonald's employees work ~50/60 hours a week, their wages are so low that they still have to claim foodstamps to feed their families yet they're still vilified by the media/society as scroungers. Guaranteed the CEO of MacDonalds has never flipped a burger in his/her life and probably smarmed and backstabbed his way to the top of the corporation, that motherfucker enforces policies that fire workers who try to unionise/ask for higher wages etc.

Corporations dictate what salaries their workers get paid, I don't care whether their workforce is outsourced to some corrupt third-party, they are still the people who decide, not oppressive regimes. No doubt there are some nasty countries who exploit their workers more than the West, but we're supposed to lead by example in the 'developed' world. Working conditions in the factories that make Apple/Mac goods etc are so bad that they've put nets under all the windows to stop their workforce from commiting suicide, juxtapose that with the happy/glossy family adverts you see on TV for Apple products. How is it right that there are people who earn more than a hour than I can make in year?

That's good to hear (I've come across that idea many times.)



Ah, well, I guess I'll deny it.

This seems to be a common misconception, that the pie of wealth is fixed, and the best we can do is to cut that pie into pieces that are more fairly sized for people. Of course, were the analogy accurate, it would imply that for someone to receive more of the pie, someone else, somewhere, has to receive less.

The truth is that wealth, when allowed to be created (that's critical) can lead to a larger pie. This means that it's possible for *everyone* to receive bigger pieces. And it's even possible for the smaller pieces to grow larger at a much faster rate than the larger pieces do. The technology industry, including Bitcoin, is IMO the most obvious example of this.

Wealth redistribution, on the other hand, creates incentives and situations that suppress the growth of the pie of wealth.

It makes more sense to (1) ensure that the playing field is fair and open, and (2) to allow wealth to be freely created and legitimate progress (social and technological) to occur unimpeded.



I see what you are saying, but I think the analogy is flawed. When talking about the poor, we aren't talking about invalids who cannot provide for themselves, even when given the means to. And if the hunters in this analogy all have some reasonable ability to hunt, then shouldn't the question of "How did this state of affairs come about?" be broached? Because again, if the system that maintains this state of affairs isn't addressed, any attempts to modify the outcome is going to be short-lived.

The disparity in the outcomes should be a clue that something deeper is going on; fix the deeper issue, and the outcomes will fix themselves. Attempting to focus on the outcome as the means to an end will leave the underlying problem alone, and will eventually undo all the work done to adjust the outcome to one's liking.

I'm not saying that every rich person only got rich through wrongdoing, BUT it can't be denied, not by anyone, that they are rich (indirectly or directly, doesn't matter) because thare are billions of people who are paid $5 a month.

--

to make the situation more clear for some minds which are kind of closed:

imagine, back in the days, humans lived in caves, hunting mammoths. They have a leader, some people are better at hunting than others, some are even to old to hunt or have no ability at all.
so they go out to hunt. the leader is making a good job, best hunters are making a good job too, even te worse hunters are helping.
so they got a mammoth, everybody happy.
if we look at animals, probably the leader cut his meat first, than the best hunters, and so on. people with no ability to hunt cut their peaces at last. nothing wrong with this.
now let's translate the situation to modern world: leader takes half of mammoth, much much more he can ever eat. best hunters take all the rest of the good meat. worse meat for the rest of the hunters; all hunters take more meat than they can ever eat.
the rest (more than half of the clan) gets fat and peaces which rested at the bones.

(this doesn't even include the fact that in our world you can have ability of being the best "hunter" in the world, but you will never be a "hunter", simply because you were born poor)

The real problem is that many wealthy people create the laws that control how wealth is handled, and disturb the order to the point that the ability for others to maintain the standard lifestyle is destroyed.  Then they propagandize and create their own order in society, destroying education, and creating a mindless subservient class that thinks they have a chance at the same privilege.

You honestly believe that to be true, in every case? You're not just collectivizing all wealthy individuals, right?

Regardless, it's true that most of humanity could probably be considered as living in poverty. And that's mainly the result of oppressive systems that keep it that way, systems that are typically run by fairly rich individuals.

But simply attacking their wealth isn't going to change that system; even if they just gave it all away they'd have it right back a generation later. Changing the system to remove the oppressive restrictions and tributes must come first, then the "problem" of wealth inequality will fix itself.

This is also a very important distinction to make: I'm tired of socialist wannabes who say silly things like "We need to steal from the rich and give to the poor!"  All this does is move the money straight back into the hands of the rich   And this is ignoring that it's immoral to take from a person who got his money through acceptable means; if you give all your money to a person and later realize you want that money back, you can't just demand that he give it back with the threat of violence because you're now broke.  If you allow yourself to be duped, you deserve what you get; only thing we can do is learn from the mistake, but we never seem to do it.

Because it's immoral to steal from someone who has done no wrong, regardless of how much money he may have.

If he has done wrong, then that is the issue that should be addressed. Suggesting someone should be OK with theft just because they would profit more than others is a pretty disturbing form of pandering. 

(And surely no one actually believes that every rich person only got rich through wrongdoing. Not only does a single counter-example disprove such a theory, but the idea smacks of collectivism, and is just as bad as "every poor person is only poor because of their own actions and inactions.")

thanks, I don't need to answer topic after this at all.


one question I have though: why are middle class "capitalists" always defending the right of millionairs and billionairs? are you realy all thinking you will be one of them (that's what I call the "hollywood suggestion")? you would ALSO benifite from a more equal distribution

The rich are rich because they're profiting from the poor; this can only happen in hierarchical relationships.  The current system is in the shape of a pyramid: the bottom ranks make the most, but they're also the biggest rank, and so divided, they each make far less than the members of the topmost rank, who make the least, but divide that wealth between very few people.  A huge amount of energy is being input by the bottom ranks, while the least amount of energy is being input by the topmost rank; the discrepancy is in why, despite each individual worker providing equal amounts of time and labor, some are paid very little, while others are paid a lot.

Socialism seeks to squash this divide; in the hierarchical system, you have a small group of owners who have the wealth to employ workers who generate more wealth for them; no business owner will ever hire a worker he cannot profit from.  In the non-hierarchical system, each worker holds a stake in the company, and though they perform different jobs of varying intensity, they each get a fair cut in profits generated; if the company does well, they all become richer; if the company does poor, they all become poorer.  This doesn't change the fact that company A can do far better than company B, but it certainly fails to centralize the world's wealth into a very small group of hands: it's not "Bill and Joe profits from Jason's and Lucy's labor", it's "Bill and Jason profit together, and Joe and Lucy compete with Bill and Jason."

I don't see anything wrong with voluntary poverty, don't get me wrong; if a person wants to be impoverished, that's his own business--perhaps he is a writer, or an otaku.  My concern is for the people who work 8+ hour shifts every day and still have to look for more jobs to support themselves and their family, meanwhile those at the top of the system have more wealth than they know what to do with (usually involving empires and lobbying and such.)  I don't find this agreeable; people who input a great amount of work should get a corresponding amount of profit.

But that's the problem, most people on this planet do not have enough wealth to cover even basic living standards. The fact that billionaires even exist is a pretty f*cked up example of what's wrong with the world. The only way they could have accumulated so much wealth is by ripping off less fortunate people down the social pecking order.

YES!

And in this case, significant wealth inequality would simply be an indicator, a signal that something is wrong in the society.

It's not a root problem in and of itself that needs to be corrected. If the *real* root problems are fixed, the inequality will likewise be corrected. To try to suppress the symptom instead of curing the disease seems a waste of effort to me, and a distraction from the real issues.

Then why is that? What is the fundamental problem with significantly unequal wealth distributions? (You'll have to forgive me for replacing your adjective 'extremely' with 'significantly', since the former is pretty arbitrary and the societies with the greatest wealth disparities will always be considered 'extreme' regardless of whether they are or not, depending on how one hashes the numbers.)



I certainly hope few here believe that. It doesn't take much honest looking to recognize that most societies seem to have plenty of means by which people can become impoverished through no direct fault of their own.



I agree, and I'm all for focusing on the lack of meritocracy in societies.



I understand, but what I'm saying is that I've concluded that it IS inconsequential, at least enough that it doesn't warrant any serious focus. And it's pretty difficult to reconsider that position when the fundamental problem with wealth inequality--what it causes, or what it requires--is never brought up, and the situation is just treated as an inherently bad one on its own merits, apart from any other considerations.

It depends on what we mean by poverty. 

Is poverty being unable to meet basic needs such as housing and food?

Or is poverty being much less well off financially that the others in your society?

Your view on what is wrong with unequal wealth distribution will change depending on which definition you go for.

I tend to the view that poverty is being unable to meet basic needs such as housing and food.  Unequal wealth distribution tends to involve inefficient allocation of capital so if there are many people of good character that are having problems making ends meet that would be an issue.

I understand what you're saying.

But are we discussing distribution of wealth, or eliminating poverty? Because it sounds like you're saying the problem with unequal distributions of wealth is that "it causes poverty." (Or perhaps more accurately, that "eliminating unequal distributions of wealth can eliminate poverty.")

If the idea is that poverty can be eliminated by distributing wealth more equally, that's simply not true. True, for the moments that everyone has their state-mandated paycheck (or bill) in hand, there is equal distribution. Yes, there are societies where wealth is more equally distributed, and in many (not by any means all) of those societies there is very little poverty.

But as I pointed out, that does not mean that it was a forced (or even voluntary) redistribution of the wealth that is the cause of the lack of poverty. Rather, wealth inequality develops over time as the natural result of numerous benign and unavoidable causes--although it can also be increased by malicious forces, which shouldn't be tolerated. If a society happens to have both low poverty and more-equal wealth distributions, then those could simply have a common cause, or even be unrelated, depending on the situation.

Here's the point that I was getting at: if the poorest people in a society have adequate wealth to take care of the basics, then why does it matter if there are a few billionaires or even trillionaires around, provided they aren't causing the poorer folk to remain poorer?

If you only advocate a more equal distribution of wealth as a solution to poverty, then the issue that's really at hand is poverty, right? And if that can be fixed without worrying about wealth redistribution, then there's no need to be concerned with unequal distribution... or is there some other issue besides poverty that unequal distribution causes concern over?