The top 3% of the population hold most of the worlds wealth.

[Nobunaga]

While I'm not so positive on the "3%" value, I do know that most of the squalid conditions which Keynesians, Socialists, and other various State-economic concepts rage against have been caused by they very government intervention which they seek within the market at various junctures in history, and at present.

Government intervention begets government intervention which begets government intervention which begets government intervention which....

Free the market, eliminate the government, and it'll work itself out.

Bollocks. Markets don't produce acceptable outcomes when they're left to their own devices, not least because perfect markets don't exist. Government intervention is needed for all sorts of reasons, not least everytime there's a recession, or one threatens. This has been standard economic practice for decades, regardless of what neo-liberal ideologues have been spouting, and is accepted by everybody these days. The UK and the US governments, for example, have both spent heavily in recent years to prevent/pull out of recessions respectively.

... Income inequality is a good thing! Or why the hell am I working overtime?

Income inequality is a fact of life, and exists/existed even in the most "communistic" of countries. The question is the degree of income inequality, not whether you have inequality per se.

For instance, many would accept that it's OK for the MD of a company to earn 10 times what its lowliest cleaner earns. I'd live with that, personally, and I vote for leftist and centre-left parties.

But an MD being allowed to trouser 100 times the lowest-paid employee is no better than institutionalised theft.

... If you want to see what "income equality" does to a country, go check out China. Madness.

I don't what it is specifically about China you're describing as being "mad", but whatever it is, you can't blame it on "income equality", as it doesn't exist there.

China does, however, have a very high degree of income inequality. Maybe the madness you see can be ascribed to this?

I'm not an economist, by the way, just an accountant, but most of what I've said have been fairly basic points. Just out of interest, here's a graph from Wikipedia, which compares the Gini coefficients of various countries over time, since WWII. The Gini coefficient is one (of many) method of measuring income inequality in a country, and a widely-used one. The higher the country is on a graph, the more unequal it is. I don't think the Gini coefficient takes account of wealth, just income, but don't quote me on that.



Notice that the UK has always been more equal than China since 1980, and it almost certainly was for most of the time China was a "Communist" country as well. I don't think that's made us any madder than the Chinese.

... It does not exist there... now. But it did for decades under the communists, and the damage has been done.

... Buy a new house ... it's got nails driven but halfway in, screws jutting from everywhere, leaking pipes, .... and that's an expensive place! There was no reward for hard work and/or giving a sh*t about your own job for so long... That way of thinking is difficult to change, and it remains very strong. Hong Kong businesses employ mainlanders, but always have very serious problems with these employees (but stick with them, as they are cheaper than local talent). They have no work ethic - none. Customer service is a totally foreign concept...

... Trust me, it's terrible. Make everybody equal and everybody starts not giving a sh*t.

... I'll check back here later. Off to work.

...

[MeDeFe]

You did not adress the point of the MD of a company making 100 times as much as an ordinary employee.

[Harijan]

The other thing that is not being address is the difference between good debt and bad debt.

It is possible to have debt that is beneficial, in fact, this is what debt was originally designed to do. The problem is that most Americans are not using debt correctly.

For example, I own approximately $500,000 in assets, but my net worth is less than $50,000. I have the nice home, two newer cars...lalalala.

Of the $450,000 in debt that I have, about $430,000 of it is invested in assets that are providing a long-term higher rate of return than the interest on the loans (namely my home and my education).

Good debt gets invested in assets that are going to increase in value(real estate, stocks, business expansion). Bad debt gets used to purchase assets that are worth less over time (vehicles, most credit card debt, appliances).

Having a low net worth is not necessarily a bad thing, but for the vast majority of people that use personal debt incorrectly, it is a killer.

BTW, nice call on the Ginni Index, I had forgotten that it even existed. You are correct, it is based on income, not asset value.

[Stopper]

I'll wait for Nobunaga to say more before I respond on that, but just to be anal-retentive:

Good debt gets invested in assets that are going to increase in value(real estate, stocks, business expansion). Bad debt gets used to purchase assets that are worth less over time (vehicles, most credit card debt, appliances).

Your definition of "good" and "bad" debt is fairly good, but a bit off.

It's still "good" to take on debt for assets that decrease in value if you expect to get economic benefits over time from them (and those economic benefits are more than the outlay on the asset.)

For instance, if you need a (reasonably-priced!) car to get to work, and there is no alternative work within walking distance, then it's not just good economic sense to take on debt to buy that car, it's essential.

I can probably come up with a better definition of what a "bad" debt would be, but I'm at work, and should really be doing something more productive instead, the better to pay off my own debts.

[Harijan]

No need, I agree with you 100%, I was just being sloppy in my language.

[b.k. barunt]

Prior to WWII, businesses paid more taxes than individuals in the U.S. Now it's the other way around. Go figure. I did a study on welfare to the rich while working on my degree, and found that we pay far more to the rich than we do to the poor. Of course, we need these gratuities to provide "incentives" to our businessmen, "to make this country great". Reagan and Bush told us that the prosperity will "trickle down" eventually to the working man, and hell, all these Republicans can't be wrong, can they?

While i've been waiting for things to "trickle down", i've been noticing that more and more factories are being built in 3rd world countries - maybe it's supposed to "trickle down" to those people instead of us. I've also been noticing the plethora of illegal aliens pouring across the border so that Bush can keep the minimum wage down, while he's given the senators and congressmen hefty raises each year of his terms. Oh well, i'm sure it will "trickle down" sooner or later, and i'm sure that our leaders will do the right thing.


Honibaz

[mybike_yourface]

While I'm not so positive on the "3%" value, I do know that most of the squalid conditions which Keynesians, Socialists, and other various State-economic concepts rage against have been caused by they very government intervention which they seek within the market at various junctures in history, and at present.

Government intervention begets government intervention which begets government intervention which begets government intervention which....

Free the market, eliminate the government, and it'll work itself out.

capitalism is canabilism

[Harijan]

Free the market, eliminate the government, and it'll work itself out.

capitalism is canabilism[/quote]

Not sure if you are posting against the government intervention (and thereby for free markets) or for government intervention (and thereby against free markets).

Capitalism, in its pure form would have no government intervention, and any "canabilism" would be market driven and therefore, not a real issue. In otherwords, eating your own would theoretically help create a stronger company and economy.

Or it could be that you just don't know what the hell you are talking about.

[Nobunaga]

You did not adress the point of the MD of a company making 100 times as much as an ordinary employee.

... Is there something wrong with that? It needs not be addressed... but I guess I'll have to explain it to the "leaning toward socialism" crowd here.

... Work your arse off, study your arse off, and if you're blessed with a big brain and quick wit, coupled with luck, you can be rich as h*ll.

... Sure, I'll never be that wealthy, but I can aspire to be.. Making sacrifices in spending and living without many luxuries, saving, investing carefully... I'll have a couple million by retirement.

... wealth redistribution awards fat-arse lazy ba*stards who had every chance at success but wasted them watching TV and surfing the net, getting drunk and making babies... whatever.

... You wish to punish success?

... My point is valid. Equality brings poor performance, terrible service and a slow economy.

...

[Stopper]

You did not adress the point of the MD of a company making 100 times as much as an ordinary employee.

... Is there something wrong with that? It needs not be addressed... but I guess I'll have to explain it to the "leaning toward socialism" crowd here.

Yes, there is something wrong with not addressing inequality. For one thing, no-one advocates extreme equality these days, so you're setting up a straw man. And in doing so, you ignore the other side of the coin, one which actually has a basis in reality, which is extreme inequality.

... Work your arse off, study your arse off, and if you're blessed with a big brain and quick wit, coupled with luck, you can be rich as h*ll.

... Sure, I'll never be that wealthy, but I can aspire to be.. Making sacrifices in spending and living without many luxuries, saving, investing carefully... I'll have a couple million by retirement.

... wealth redistribution awards fat-arse lazy ba*stards who had every chance at success but wasted them watching TV and surfing the net, getting drunk and making babies... whatever.

... You wish to punish success?

... My point is valid. Equality brings poor performance, terrible service and a slow economy.

...

Since equality does not, and will never, exist anywhere, I assume you mean an extreme degree of equality.

So bear in mind that an extreme degree of inequality also brings poor performance, terrible service and a slow economy, to say nothing of its moral abhorrence.

I have never been able to fathom why people like you keep railing against something that doesn't exist, while at the same time you think it's OK to "reward" people like, for example, British footballers, with £50,000 a week, while hundreds of millions of children the world over don't get enough to eat every day.

[Jehan]

yeah the idea of reward is only applicable to those already in the top what, 20% of the population? the rest of world being stuck in a poverty cycle where you work all day just to feed yourself.

[2dimes]

Work all day just to feed yourself. Sounds like quite a large amount of regular working class. Everyone gets the idea of reward, that's how Kathy Lee and Wal-mart open shop in those poor places and pay what seems like nothing to us and make the employees feel like the local equivalent to Rothchilds.

while hundreds of millions of children the world over don't get enough to eat every day.

I think most decent folk are thankfull for people like yourself that are doing everything in their power to feed them kids.

The biggest problem is people like myself, who are looking for every oportunity to take a sandwich right out of the little buggers hand, just to get that new cell phone that can ring like my favorite song.

[xtratabasco]

The most comprehensive study of personal wealth ever undertaken also reports that the richest 1% of adults alone owned 40% of global assets in the year 2000, and that the richest 10% of adults accounted for 85% of the world total. In contrast, the bottom half of the world adult population owned barely 1% of global wealth.



this is from a un report on global income distribution...admittedly in the 2006 report the statistics are only from 2000, but these things tend to lag by a few years.

Also this was a very simple scan of the summary of the report, once could certainly look closer to find more information.

I think he is right.
Ive heard 5% owned 40% and the top 10% owns 90%


pretty fucked up


for example Ken Lay of Enron owned 14 houses and or lots just in Aspen alone. The houses in Aspen average about 10 million and a modest lot will go for 2-5 easily. All while tens of thousands of his employees lost everything, all of their pension and stocks went from 250.00 to 30 cents a share.

It may have been an investement but they were for him and his family and friends to use.

In the gated communities like Aspen or Vail, Beaver Creek and Jupiter houses cost 5-20 million a piece, the people that own them only use them for about 2 weeks a year and, on average they own about 20 houses around the world.

[2dimes]

Now Ken Lay's dead. So maybe it's not good to own 14 houses in Aspen.

How many of his former employees are still alive?

Wait a minute, lets see some pictures of these houses...




He almost had me there.

[mybike_yourface]

Free the market, eliminate the government, and it'll work itself out.

capitalism is canabilism

[/quote]

yeah, let's just free up the market and then we can f*ck each other over individually instead of corporations doing it for us.

[Harijan]

yeah, let's just free up the market and then we can f*ck each other over individually instead of corporations doing it for us.

Now you are getting the right idea. Kill the regulations and subsidies and see how long it takes for people to beat the hell out of irresponsible corporations. Or for the corporations to implode on their own greed and amoralistic cultures.

We just don't know what would happen in a deregulated market post information revolution.

There are no more dirty little secrets, there is just dirty.

[Stopper]

Work all day just to feed yourself. Sounds like quite a large amount of regular working class. Everyone gets the idea of reward, that's how Kathy Lee and Wal-mart open shop in those poor places and pay what seems like nothing to us and make the employees feel like the local equivalent to Rothchilds.

while hundreds of millions of children the world over don't get enough to eat every day.

I think most decent folk are thankfull for people like yourself that are doing everything in their power to feed them kids.

The biggest problem is people like myself, who are looking for every oportunity to take a sandwich right out of the little buggers hand, just to get that new cell phone that can ring like my favorite song.

Very sarcastic, 2dimes, if absolutely lacking in any kind of basis, or point, whatsoever.

I merely stated that hundreds of millions of children are malnourished, while a very small number of people live on fantastic riches no-one could ever possibly need, in order to illustrate the level of inequality there is in the world today.

I made this statement to someone who said that inequality doesn't matter.

Maybe you think that this state of affairs doesn't matter. If so, you could probably put it in such a way that doesn't seem to suggest that I somehow blamed you or Nobunaga for it.

[2dimes]

Easy Stopper, I'm not saying it doesn't matter per-say.

I was just confessing that I'm a greedy North American that wants $7billion and an airplane. Not really caring who has to starve to provide it.

If others have a conceince and want to help hungry kids, good on 'em.

[Nobunaga]

.. while at the same time you think it's OK to "reward" people like, for example, British footballers, with £50,000 a week, while hundreds of millions of children the world over don't get enough to eat every day.

... OK, so you want to take that man's money from him and give it to those poor kids? You want to give government that power?

... Yours might already have that power, I honestly don't know. I don't want mine to have it.

... As for absolute equality - sure, it will never exist. I'm in total agreement. But the "straw man" has a punch, Stopper, because until that absolute equality exists (and we agree it never will), people will be crying out for more stuff. And folks who work hard will have to pay for it through taxes.

... (obviously, you are thinking global and I am not... but the principle remains, imho, obvious).

... The "Evil Rich" top 2% in the US pays 40% of all US income taxes. ... talk about unfair.

...

[Stopper]

... As for absolute equality - sure, it will never exist. I'm in total agreement. But the "straw man" has a punch, Stopper, because until that absolute equality exists (and we agree it never will), people will be crying out for more stuff. And folks who work hard will have to pay for it through taxes.

By definition, a straw man argument can have no punch, since its basis doesn't exist.

Point me in the direction of the major political party or government that is doing such an evil thing as slightly lessening the differential in people's pay, and we'll talk some more, because then you might have a point.

I doubt you will find them, since in most of the world today, including China, the US and India, inequality is widening, not lessening. Their economies (well, temporarily, not the US's) are growing, but the poorest of these countries, who work the hardest, don't see their incomes grow in step.

... (obviously, you are thinking global and I am not... but the principle remains, imho, obvious).

... The "Evil Rich" top 2% in the US pays 40% of all US income taxes. ... talk about unfair.

...

Now, I think I will go to luns' thread and cry my bleeding heart out for all those millionaires and billionaires who have to pay a slightly higher percentage of their income than people with normal incomes. Well, except for those who aren't domiciled in the US in the first place and pay nothing at all.

[Nobunaga]

Point me in the direction of the major political party or government that is doing such an evil thing as slightly lessening the differential in people's pay, and we'll talk some more, because then you might have a point.

In 2006:
The richest 1% paid 34.3% of the entire US Federal budget, and lost more than 31% of their income to federal taxes.

The richest 10% paid for 65.8% of the budget and lost 26.9% of their income to federal taxes.

The richest 25% paid 83% of that budget.

... by comparison, the middle 13% lost 13.9% of their income, while the poorest lost 4.5%

... The mega-rich will remain mega rich, as 69% of "Mega Rich" is still a lot of cash. ... but

The upper middle class is being beaten down with high taxes while those of lesser means can buy a lot more with the money they don't pay in taxes.

... This forces something approaching "equality".

... (quoting Stopper) ..."Well, except for those who aren't domiciled in the US in the first place and pay nothing at all." (end)

... It seems you're the one missing some facts tonight, Stopper.

...

[Nobunaga]

In the gated communities like Aspen or Vail, Beaver Creek and Jupiter houses cost 5-20 million a piece, the people that own them only use them for about 2 weeks a year and, on average they own about 20 houses around the world.

... The B*STARDS!! They should all be taken out and shot! Immediately! Then their arrogant assets auctioned, proceeds donated to the Ronald McDonald House!

...

[Stopper]

The richest 10% paid for 65.8% of the budget and lost 26.9% of their income to federal taxes.

The richest 25% paid 83% of that budget.

... by comparison, the middle 13% lost 13.9% of their income, while the poorest lost 4.5%

... The mega-rich will remain mega rich, as 69% of "Mega Rich" is still a lot of cash. ... but

The upper middle class is being beaten down with high taxes while those of lesser means can buy a lot more with the money they don't pay in taxes.

... This forces something approaching "equality".

For a start, it should be obvious that even if you had a flat-rate tax system, the richest 1% (or whatever fraction you chose) in an unequal society would pay what appears to be a disproportionate amount of money. But then, of course they would, they're taking a disproportionate amount of money in the first place.

Even so, I believe (although I'm not 100% clear that this is still actually the case) the US still has a broadly progressive income tax system. But so what? The redistributive effect of the tax system is like a gnat's bite compared to the much, much greater effect of other trends in society, which successive governments have also allowed.

Obviously my Gini chart wasn't clear enough for you, so here's another one on Wikipedia, which I can't reproduce here for some reason. Notice the red line - the poorest 10% have seen no real inflation-adjusted increase in income for 30 years. But go up the chart, and it becomes clearer that the richer you are, the greater share of the nation's wealth you've trousered for yourself over the last 30 or so years.

Here are a couple more facts for you:

From 1979 to 2002, the minimum wage, in inflation-adjusted dollars, has dropped 21 per cent.

In the same period, corporate executives were under no such restraint: in 1980, CEOs made 45 times as much as their workers, while in 2001 they made 531 times what their workers made.

Maybe you can explain to me how exactly American CEOs have become 10 times more productive in that 21 years. Or perhaps they just haven't, and have just been allowed to take more of their companies' income just because they could.

As I've often said... this [increasing income inequality] is not the type of thing which a democratic society—a capitalist democratic society—can really accept without addressing.

What a bleeding-heart hippy.

[Nobunaga]

... Look at the thread title, then explain to me (anybody) what's wrong with the rich having so much wealth?

... Is it evil? They don't deserve it? Don't give me comparisons on how many times larger their paychecks are than the "average Joe". Such comparisons are not an argument.

... Do you (whoever) think people should not be allowed to be so rich? And if so, why not? It's unfair? It's mean? ...

... I don't get it. Explain, and speak to the point please.

...

[DaGip]

... Look at the thread title, then explain to me (anybody) what's wrong with the rich having so much wealth?

... Is it evil? They don't deserve it? Don't give me comparisons on how many times larger their paychecks are than the "average Joe". Such comparisons are not an argument.

... Do you (whoever) think people should not be allowed to be so rich? And if so, why not? It's unfair? It's mean? ...

... I don't get it. Explain, and speak to the point please.

...

Well, if we did things like the Native Americans did back in the old days...the richest, most prosperous of people...were often the poorest. Why? Because the Chieftains always gave away their possessions to the community, and that kept everything fairly equal. The Chieftain acquired assetts and distributed it out to the less fortunate, and in turn, the community would give back to the Chieftain.

The way the world is going these days...we may be heading back to these old ways very shortly...