Do the words 'top' and 'bottom' perhaps mean something? Have you ever bothered to look at the distribution on wealth and income?
The top 1% has more more wealth than the bottomn 50%, it is impossible for the bottom to contribute more than the top
"it is impossible for the bottom to contribute more than the top"
What I'm hoping for is a significantly more equitable contribution of the bottom 50 percent to broader society than what they're currently contributing. Something like a flat tax rate and a reduction in entitlements, perhaps, but I don't have conviction on the exact specifics.
And yet their share of wealth keeps on growing and growing for decades. Curious.
Take JK Rowling as an example. Her work added significant value to the lives of hundreds of millions, and she got a slice of all that value creation (say, 30 percent of it). Nobody is worse off. Everyone is better off. Her value proposition was magnified by the scale afforded to her by modern day distribution and movie deals, which is why she got so fabulously wealthy compared to what an author could've achieved (relative to their surrounding population) 100 years ago.
The poorest people inside developed countries on the other hand have had a decreasing value add to society. This is partly because of automation and partly because of globalization and the fact they now have to compete with 1 billion Chinese who work harder than them and for less.
You pay Netflix $15/month because you think it adds more than that much value to your life. Netflix earning that income is a consequence of your judgement of the value add of that service to your life. If Netflix makes billions in profits, it's because people like you thought that it added that much value (and more) to their lives. The same reasoning applies to most things (groceries, personal trainer, hairdresser, etc).
There are ways that people can get rich that definitely aren't proportionate to their value add. Cronyism, externalities, hijacking people's dopamine systems, and so on. That's why we need a government that can implement the right policies that maximize the correlation between money earned and value add.
There's also things that add large value through positive externalities that don't result in getting rich, such as scientific research, where it's very hard to privatize the benefits.
A big problem we have in this discourse is the conflation of the two ways of making money (value add vs extraction) into a single bucket (on the far-left it's all extraction and on the economic-right it's all value-add), which is having a terrible impact on our ability to think clearly about policy and is making regular people resentful and jealous instead of thankful towards the most productive people in our society.
When I think of the richest that gained a disproportionate amount of that wealth that left the bottom i generally think of rentseekers, people using anticompetitive practices,(near) monopolies, duopolies or monopsonies, etc Reaching that position has been made easier for many of them due to technological advances indeed but that they're in those and that they're incredibly unhealthy for capitalism is the case none the less. Also definitely cronyism and so on as you mentioned.
When we look closely most companies and the people pulling profit from them fit into this category of utilising a form of capitalism that can't be considered healthy for society at large. For example everything from intel and amd artificially extending their IP into perpetuity by strategically extending the standards with new IP every x years to microsoft simply waiting out a competitors bankruptcy in court and abusing their clout for competitive advantage in new markets, apple and google using their duopoly/monopsony positions to charge high rates in their app stores to google dictating webstandards in their favour due to their clout and fucking over competitors, solarcity pulling shady contracts, supermarkt chains pulling a larger share of profit from farmers and other producers despite reducing their value to the distribution chain as their marketshare grows,etc
When i think of these i think of people who have gathered value worth countless lifetimes of hard work to a point where it should be impossible becaused it is impossible to be proportionate. People who are generally wayyyyy further away from anyone in this thread wealth wise than we are from a bum on the street.
> and is making regular people resentful and jealous
Might have something to do with things like social mobility and such declining for so long. Capitalism should not be allowed to devolve into an oligarchy.
Yes it is. Also of government, more generally (well, power, of which wealth is a subset.) Before the modern era, this was pretty consistently upward redistribution, aka concentration.
False consensus fallacy
>> You know this and everyone knows this.
> False consensus fallacy
Absurd comment. The wealth inequality and regressive taxation has been inherent to capitalism since at least roman times - http://www.bbc.co.uk/history/ancient/romans/social_structure... https://foreignpolicy.com/2020/08/14/wealth-tax-zakat-islami...
Once your wealth is international, you don't have to pay on what you don't declare across tax regions. These havens arent really havens, as much as optimizations on where you declare assets based on asset class. etc
Countries like Norway or Sweden, which have more billionaires per capita than the USA have much less progressive tax codes.
[1] https://www.cbo.gov/system/files/2020-10/56575-Household-Inc...
What kind of benefits the person is gaining by buying $25MM worth of taxes?
I thought so too.
Give that person a chance to reinvest these money into local economy, growing productive businesses instead of slapping the "filthy rich" label and suddenly there is a lots of capital are used for everyone's benefits instead of escaping.
Example: Rich people > Shit newspapers > Misinformed populace > Shit political choices > Shit government > Corruption > Rich people now have more money.
Hmm there's so many hypotheticals there.
Perhaps they may fund the roads this persons company uses. Or the foodstamps this persons underpayed workers rely on. Perhaps they sustain the people that pay into his rentseeking scheme.
Perhaps that's not the question you should be asking because not a whole lot of people give a damn about this persons 25 million staying in his pocket. (This person him/herself being part of this 'not a whole lot of people')
and a whole lot of people on the other hand would rather this person be incentivized to avoid these taxes by investing in R&D and/or increasing the wages of the people he depends on so as to benefit society and to stimulate the economy.
Unfortunately many people don't appear to think like that. Or are willfully blind/ ignorant. Take your pick.
A bit of simple math is needed to supplement decisions in terms of return on investment.
Overbloated government spending and useless wars are not a good arguments either.
If government cannot manage their budgets well, why would people who can manage their budgets better should listen?
Avoiding guillotines?
You can already do this, though. Monaco exists. That folks like Bezos, Musk, and Gates stick around in the US indicates some intangible benefits here that justify paying some tax.
People would be happy to pay 100% in tax to avoid guillotine but how much of a prosperous and productive society can be built with this approach?
The carrot is "you get to live in a prosperous, stable society made possible in part by your contributions via taxes".
The stick is what happens when you don't.
The reality is that wealthy person can choose both (live where he wants and keep money safe from tax robbery) and poor can neither.
Inequality is brought by high taxation and not by filthy rich who refuses to obey government stupid policies.
People who make $100MM are no smarter than those that don’t, I mean Einstein didn’t make that type of money right? It’s not merit either, it’s simply money...under our system money makes money, concentration of capital doesn’t benefit everyone it benefits the person with the capital.
Consider wealth management itself, you want to diversify your investments, you would never put 90% of your wealth into .1% of the assets you own. The rich know and live by this rule, well that same rule applies to society, you don’t want .1% controlling 90% of the wealth so investment is determined by .1% of the population. You want the wealth diversified and in the hands of many so no single person controls investment.
Especially if this is a majority of non-productive, lazy individuals unwilling to get educated, work and prefer to live by selling their votes for printed money of government grants.
In a democracy, yes it does.
Oh, and in my country, it is punished, it's just that the team which must find about the culprit are totally under staffed, what-a-surprise.
Tax avoidance and tax evasion are distinct things. Tax avoidance is (deliberately) legal. Why do you think it should be punished?
For better or worse the only way that type of inequality happens is as a direct result of the policies of the country they live in, thus they should be grateful and thankful for living in a country that not only allows but promotes that type of concentration of wealth.
In exchange for the benefit of living in such a country that promotes such wealth inequality, they should pay a 90% tax rate to reflect the wealth inequality itself. They will bitch and moan of course, but they will still be far richer and better off than everyone else, and everyone else will be better off not living in a country with such high inequality and a country with tremendous national resources, as opposed to a country that is $28T in debt further decreasing the quality of life of those without the personal wealth to not need public services.
If we can ensure that no single individual has to live below the poverty line then I'm less worried about individuals who attain huge stores of wealth.
Otherwise many are under the impression that looting and robbing is a way to go.
Also, if the billionaires give a tiny amount of their money to fund schools, people will get educated, earn more money and be able to spend more.
And governments of course has a ways to convince them that doing that is not wise.
High taxes is the easiest way to deplete economy from productive individuals and their resources.
Taxes literally are used as a tool to incentivize investing in the economy.
I'm sure taxes has all the good intentions but how well does it work so far if trillions of dollars are escaping in direct opposite directions?
If the tool doesn't work at all - in fact instead of building it just breaks stuff - wouldn't it be a good idea to try a different tool?
It might be, or at least a step in the right direction, if those billionaires were teaching free wealth acquisition classes as a full time job after they attain three commas.
Many of the wealthy are born into wealth and have family and institutions that help them maintain it. The poor won't have a start like that, so we might have to setup pools of money donated from these billionaires for the poor to start out with. It could even have a catchy slogan too. Something like, "No exploitation without education."
"...educate others how to earn good money and live a good, productive lifestyle".
You may add to that many other educational resources and lots of them are free. People who are willing to learn will learn.
People who are unwilling to learn and prefer to rob and loot - will continue doing so.
Who needs more than one pair of shoes?
Who determines what other people need?
Maybe we should forget we are adults and have a governing body tell us why we need so we don’t have to think about it?