All the money of the richest people in the U.S. could provide the poorest with a good income for a year or two, but then it's gone and we still haven't addressed the cost of education or healthcare, or even started to address the fact that the poor in the U.S. are not particularly poor by worldwide standards.
From a pragmatic, how-to-make-the-economy-work-better sort of perspective, there mostly needs to be a lot more wealth, period, in the form of more housing, more energy (hopefully renewable), more food (though we waste a lot in the US), more healthcare, more everything. From a basic math perspective, it seem like redistribution gets us like 1% of the way there, and only in the U.S. Once you start redistributing around the world, you run into the problem that a whole lot of people are really desperately poor in a way that can just devour redistributed dollars unless those dollars are creating growth. This isn't to say that redistribution isn't a very useful tool, and I'm actually a fan of lots of spending on infrastructure and a social safety net, but I believe economic growth is how you erase poverty.
That's actually not true.
Think about where all that money goes when people spend it.
And then the people who receive it spend it again. Etc.
Round in a circle, basically, so they will continue to have a good income for much longer than the back-of-the-envelope calculation suggests.
Perhaps in perpetuity if the redistribution continues; then it would be a system change rather than a one-off event.
That said, I completely agree with you about investment, especially in things like housing, and other forms of investment and wealth generation.
> I believe economic growth is how you erase poverty
If you believe in the idea that "what you measure is what you create", then it depends on how economic growth is measured.
Measures that look at growing the average wealth or economic activity of people in a population largely ignore poverty. Even with a lot of desparately poor people, because of the power law distribution of wealth, the poorest people contribute less to the average than their numbers would suggest.
For that sort of reason, I prefer the idea that a society is judged by how it treats its poorest people first.
(And by people I don't mean citizens, because non-citizen residents are real people too.)
That said, I do agree with what you said about measuring growth and poverty, but I think the simple math about redistribution is useful because while you can circulate dollars, you can’t circulate factories or farms or infrastructure. Wealth in useful forms throws off income that is a small percentage of what those things are worth, if you “consume” the wealth and not just the income, then the wealth is destroyed and doesn’t produce more wealth, and the numbers on redistributing income look even more bleak than the numbers on redistributing total wealth in dollar terms. And that’s what I feebly attempted to communicate, that there just aren’t enough productive assets in the world to produce all the things we as a species need to feel like we’re living our best lives and certainly not to do so sustainably.
How do you propose making it happen? Note that by saying this, i dont mean “how do you convince him to do it”. I mean, what would be the process for doing that, assuming everyone is already on board with it.
99% (or close to it) of those billions of Jeff Bezos’ worth are in Amazon stock. How do you propose making his net worth only $50bil and making use of the rest? Making him give up half of the ownership in the company by giving his shares to the government, thus making the government a major shareholder in the company?
This is a genuine question, because i do not see how else shares can be feasibly taxed until the moment they are sold. And there is no way Jeff would be able to sell half of them, i bet there are rules that don’t even allow major shareholders cash out like that, since it would crash the value of Amazon overnight. And by the time he is done selling, he would have made way less than that, as the value of shares will be continuously dropping as he sells. Not even the mentioning the whole aspect of forcing someone to sell their shares and, thus, giving up their ownership in the company.
On the other hand, making it so someone like Jeff Bezos could never accrue $100bil in the first place is a lot more plausible.
> i do not see how else shares can be feasibly taxed until the moment they are sold.
Oh, that's just a matter of assigning a notional value through some accounting estimation process. The value might be wrong but that's ok, overpaid tax would be returned if a lower value was discovered at the next sale.
But why sell the shares anyway. If you're going to transfer $50bil (currently in shares) to lots of poor people, transfer the shares. I expect people would find a way to trade their microshares afterwards to get the things they need. Amazon would probably be happy to run the microshare-trading service for a small commission :-)
That's an exaggerated and misleading description. Per person government spending in the U.S. ($22,500 per year adjusted for purchasing power) is well above the OECD average, and right between Switzerland and Germany: https://www.oecd-ilibrary.org/sites/reg_cit_glance-2018-41-e.... (Factoring out the difference in military spending, about $2,000 per person in the U.S. versus $600 in Germany, doesn't change the ranking. The next country below Germany is Ireland, at under $20,000.) Four of the largest five EU countries (Spain, Italy, Germany, U.K.) spend less per person -- again, adjusted for purchasing power -- than the U.S. France is only a little higher, around $23,500. Excluding Norway (oil money) and Luxembourg (tax haven), the highest is Denmark, at $26,000.
We have a big government in the U.S. It's often not very efficient. We consistently spend more to get less in terms of education or healthcare. But that's a very different issue.
The ultimate state of being in the US is one of higher freedom.
What happens at the bottom end is neither here nor there.
I prefer the European model as well - but let's be clear about this - most socialist countries don't really care about this either from a moral perspective, it's more of a law and order thing and a different way of running a society internally.
The UK is leaving the EU in large part because a lot of people think immigration from other reasonably-developed countries is too high. The actually poor parts of the world are like a massive blind spot that we wave away into the category of 'asylum seekers' as if they're subhuman.
Everywhere and everyone has a blind spot somewhere.
So I don't get why the 'land of the free', the 'greatest nation on earth' can can be so ideologically opposed to wealth redistribution and the concept of a wellfare state as it seems to be. Jeff Bezos would not feel less free if he was worth 50 billion instead of 100. But the freedom that money could create among millions of others is enormous. And I'm not just arguing this as a moral kinda thing, e.g. 'think of the starving children', I'm just as much talking about this as a pragmatic, how-to-make-the-economy-work-better sort of thing. It's not just handouts, it's investing in people that don't have the resources to invest in themselves. It's increasing the size of the middle class that is capable of buying things, creating a bigger market for entrepreneurs to sell stuff to. Get the money circulating instead of stagnating in some tax haven.
Is it because the Cold War has forever branded anything remotely resembling socialism anathema? Is it the propaganda from Fox News? Is it because the country's independence movement was kicked off with an opposition to taxes (the Boston Tea Party) and that has forever instilled the notion that taxes = bad in your very soul? I can see why those things would create resistance, but it just seems like such an ideological and not very pragmatic position at this point.