Foreign militaries investing in autonomous warfare does not assuage my concerns about my country investing in autonomous warfare.
Also, have you been paying attention to median wages vs median CEO wages since the 1960s? The benefits of computing really have gone to the captains of industry.
Today's CEOs get a gold-plated sky bus.
If you're going to spend a quarter of the day travelling, why not spend a third of the day and do it more comfortably?
The F-35 isn't the fastest jet; fighter jets aren't business jets; apples are not rutabagas.
After a short exploration you can reach the conclusion that nothing new is worth inventing any more.
Only by loosening those constraints can you make something that's meaningfully better.
Just look at GINI index: https://data.worldbank.org/indicator/SI.POV.GINI?locations=U... That's all you need to know
CEO pay isn’t a good proxy for “captains of industry.” What you want to look at is the labor versus capital share of income. That’s been very stable since the 1960s: https://taxfoundation.org/blog/labor-share-net-income-within....
> Ultimately, concerns over inequality should focus on differences within labor compensation rather than the split between labor and capital.
The main issues I can see are:
- This "labor share" includes multi-million dollar executive pay packages, so it's heavily skewed towards the 1%
- It also completely ignores unrealized capital gains and loans against them, which is how the ultra-wealthy actually fund their lifestyles tax-free, with a tiny income on paper
Similarly, what percentage of wealthy people take loans against their assets to fund their lifestyle? You should be able to quantify this if it’s happening at scale.
The income share of the top 1%—so including run of the mill doctors and lawyers—has grown from 15% in 1970 to 21% today: https://ourworldindata.org/grapher/income-share-top-1-before.... There is no way that delta is enough to eat up all the income growth since then.
https://www.sciencedirect.com/science/article/abs/pii/S00472...
"The income tax base captures 60 % of economic income of the top 1 % of wealth-holders.".
I would love if only 60% of my income was taxed. Heck I'm now even taxed on used junk I sell using Paypal (that I bought with taxed income dollars and paid sales tax on). But a tax that includes that other 40% of the top 1%'s economic income, guys, we can't do that. But don't forget to file your Paypal taxes or waves at threat of prison.
"Focusing on the top 1 %, while total borrowing is substantial, new borrowing each year is fairly small (1–2 % of economic income) compared to their new unrealized gains" "1 % of wealth-holders (above $14 million in 2022)"
1-2% of $14,000,000 is $140,000 to $280,000 a year. The median personal income is $45,140. They are benefiting untaxed to the tune of 3-6 times the median American income.
1-2% of 100 million is 1-2 million dollars a year untaxed benefit (44x median income). That is substantial.
I would love to benefit annually by that 'insignificant' amount goin untaxed. We should either exclude all economic income below $140,000 to $2,000,000 from taxation or change to tax this loan scheme that allows the top 1% to avoid their share on income 44x the median and even higher.
OP above said that billionaires pay for their lifestyle by taking loans they never pay lack, and the article says that isn’t a common approach.
> 1-2% of 100 million is 1-2 million dollars a year untaxed benefit (44x median income). That is substantial.
No, it’s not substantial because very few people make $100 million a year, while many people make the median income.
For example, billionaires last year added $1.5 trillion to their wealth, of which 56% was unrealized gains. If you take 2% of those gains as in the article, you get $16.8 billion that should be taxed as income but isn’t being taxed. I’d be fine taxing that money at the top marginal rate or whatever you want to do. But it would raise a piddling amount of money. That’s a rounding error compared to total AGI, which is over $15 trillion. The U.S. governments spend $16.8 billion every 14 hours.
1-2% of 100 million is 1-2 million dollars a year untaxed benefit (44x median income). That is substantial benefit for someone to receive. They are benefiting from buy, borrow, die. You asked for proof, I gave you proof that it is happening and is providing a substantial unfunded lifestyle (44x median income is a substantial income).
Hopefully I won't see further posts from you saying it isn't happening/we don't need to tax it/we aren't loosing revenue. You agree it is happening, and you are ok with taxing it. You don't think it will fund the entire budget. OK. But we have multiple tax streams that don't fund the entire budget, and when patterns shift, we address it, such as now tracking/taxing paypal payments and in the future loans on unrealized gains.
Yes, but that’s not the topic. The topic is the labor share of income over time. Your link proves that these loans don’t have a meaningful effect on analyzing the division of income between capital and labor over time. They amount to 0.1% of total income.
I don’t understand why people bring this up so often. There’s dozens of tax loopholes that are greater in magnitude. Eliminating the mortgage interest deduction for example would raise 5-7 times as much money as even a 50% tax on these loan proceeds.
>Similarly, what percentage of wealthy people take loans against their assets to fund their lifestyle? You should be able to quantify this if it’s happening at scale.
That is the topic being addressed, proof was shown, and you replied "I’d be fine taxing that money at the top marginal rate". To your 'but what about other loopholes' please show me 24 loopholes (dozens) providing individuals such high multiples of median income tax free?
>I don’t understand why people bring this up so often
You just agreed it is happening and you are fine with taxing it in your last message, so it really doesn't matter people bring it up or not, does it? And kind of makes further discussion moot. You agree it's fine to address/tax.
>I’d be fine taxing that money at the top marginal rate or whatever you want to do.
The mortgage interest deduction is not a loophole, it is government policy intelligently reached. A loophole would be when rich people abused the deduction by designating their yatch as a second home and deducting that. And that loophole was closed. The average person having to pay taxes on the old dresser that they bought with already taxed money and report the sale as paypal income earnings would be another loophole but in the other direction..
I look forward to your 24 stated existing examples of greater magnitude actual loopholes (and not intentional policy doing what it was intended, the opposite of an exploited loophole that is taking loans instead of selling stocks to avoid taxes but benefit from realized/current stock value). We can move to the next level but again you agreed you are fine taxing this behavior so kinda no further point.
I asked whether that "meaningfully change[s] the picture"--i.e. the picture on the labor/capital income split. And I asked whether that practice is "happening at scale." I wasn't asking whether it was happening at all, but rather at sufficient scale that it would meaningfully skew the numbers on labor/capital income split.
Your data proved my point: loans against assets account for only 1-2% of unrealized gains, so even if you counted that as income, it would be a rounding error in the evaluation of the labor versus capital share of income.
But we don't need to dig deeper. We are all in agreement and don't need further discussion. Tax it.
>I’d be fine taxing that money at the top marginal rate or whatever you want to do.
Thank you for engaging. We can try going deeper but OP might be better for that. I just had that report with at least some information and wanted to interject so we could talk to something (even though I knew their thesis counters my position, it's worth us all knowing about, and I think it's showing it does occur at least some is useful for my position). Anecdotally in another life I knew some of these people/people in their circles and they very much use these loans and were crazy excited when they learned of the strategies of them.
Isn't that what happened? There was enough competition among computing companies that they weren't able to completely monopolize all the productivity improvements, but the financial benefits were mostly captured by the capital class in one way or another.[1]
TVs might be cheaper today and we all like watching Netflix, but I'm skeptical of the idea that the financial wellbeing of the average American has been improved by computers.
[1] - https://www.cbpp.org/research/poverty-and-inequality/a-guide...
Really? Even with all the new avenues of education and communication that they opened up? You think the positives and negatives balance out to close to zero?
It is interesting how the wealth concentration started in the '80s. It could be computers that caused it, though I would be more likely to blame it on Reagan's economic policies.
Fine, I’ll include your disclaimer about confounding factors.
With all factors combined, it doesn’t appear that the average American financially benefited over the course of the computer revolution. Do you dispute that and if so, what is your evidence?
I don't see the data on absolute wealth in your link, so I went with what I had.
>I guess it shouldn't matter that the bottom 90% of Americans have seen their share of wealth decrease since that started being measured in 1989. The median worker should be thrilled as long as their real wages have increased.
Well... yes? I mean, should I care that there's a multibillionaire I don't know somewhere in the country amassing an obscene fortune, if I'm living a little more comfortably every year? Most everyone is living better, isn't that fine?
>Who cares if inflation numbers fail to account properly for more nuanced changes to cost of living
How is that my fault? It's the data you used. Why are you using it if you think it has flaws?
The page I linked also having income numbers does not mean I agree they are a good analog for were this value is captured. I don't believe income increasing at slightly under 1% a year actually indicates that "Most everyone is living better" today for the reasons mentioned above. You're free to offer counter evidence and I don't know why you're acting like you were limited to only referencing the source I provided.
Regardless of how the conversation started, the statement I questioned, and which you chose to defend, was
>I'm skeptical of the idea that the financial wellbeing of the average American has been improved by computers.
I won't simply grant that relative wealth is equivalent to absolute wealth. That's like saying that if you have a dollar in each pocket, putting another dollar in your right pocket makes your left pocket poorer. No. Maybe it's really true that the rich have captured the productivity gained from personal computing. I don't know. But what you said was that you don't think personal computing has contributed to the financial wellbeing of Americans, on average. Even if you had data showing that most households are financially the same or worse since the dawn of personal computing, I don't know you would get from there to attributing it to personal computers (beyond post hoc ergo propter hoc, which I don't need to say is rather flimsy).
>You're free to offer counter evidence and I don't know why you're acting like you were limited to only referencing the source I provided.
I appreciate the offer to do work for no reason, but I'm fine, thanks. Why would I need to present any evidence to refute you when the evidence you presented doesn't back you up?
Well, we'll leave it there then. I don't know why you felt the need to debate a point you admit to not having any actual insight about, but I'm going to stop entertaining your devil's advocacy.
Not only is that exactly what happened, they weren't satisfied with accumulating most of the wealth produced by it, they've also taken it upon themselves to take over democracy and media and act like a state within a state. You only need one statistic to understand America today, that working class Americans without college degrees have had their purchasing power stagnate since the 1970s(https://www.epi.org/publication/charting-wage-stagnation/)
People who used to have good jobs can now drive for Doordash and what the last wave of digitalization did over 30 years the AI gurus now promise to do in 10 again, and not just to the working class. The only reason to be optimistic is that they're snake oil salesmen.
Having a college degree was a much more selective measure in 1970 (about 10% of the population) than today (almost 40%). Consider a large law firm. In 1970, the only 4-year degree holders would have been the attorneys. A lot of work would have been done by well-compensated paralegals with high school diplomas. Today, everyone down to the receptionist will have a degree and the non-degree holders would basically be the maintenance and cafeteria staff.
So using your math, the income of non-college workers at the law firm could be stagnant from 1970 to today, even if the income of each specific position had increased significantly.
Other than Nintendo, how many games companies today were around back then?
End result for 100-16 % of Americans is the same
And my argument is straight assuming you're OK to say the financial PoV is a good PoV, I'm not arguing for or against that claim.
All found in the 80's or earlier and still pretty well known today. It could be argued these are different companies today, but they exist.
Half the ones I recognise from that list seem to be somewhat older than I realised though.
But everything between and including Bethesda and Atari is more recent than the decade I was replying to. Strictly speaking everything more recent than Saga is more recent, but I did misread it initially as "the 1960s" not "1960".
I want to be optimistic and agree with you, but I don't think the parallels are as strong as you say they are. We already have Anthropic withhold Mythos from the public, the governement now allowing the use of Fable, I don't think its farfetched to think that the US will start regulating access to Chinese/open-source models, pricing for compute isn't slowing down. The problem isn't AI, but who controls the compute that powers it.
No company in the 1990s ever achieved as much market power as IBM did in the 1960s-1980s. IBM controlled 70% of the computer market at the time.
Can you give me a concrete example that’s relevant to the deployment of computers?
The computer market was microscopic at the time.
> Can you give me a concrete example that’s relevant to the deployment of computers?
Nvidia. 92% of domestic GPU market, 85% of AI datacenter market.
The AI investment bubble is exploding the cost of everything that contains RAM or SSD storage. This is having and will have detrimental effects on the global economy, as supply shortages enormously increase the cost of consumer electronics, cars, anything which requires memory.
Not because AI is making so much money, far from it - it's a money sink. Rather, it's because the global supply of money got so large and so unequal that it ran out of vehicles which would provide sufficient returns for the indolent investment class. So they jumped into speculation - first crypto, now AI and the tech that enables it.
To the benefit of whom? Mass layoffs, tech industry consolidation, new products being cancelled left and right.
Ironically there's no equivalent in the modern era. This is peak social inequality breaking the economy for everyone outside the .001%. And it didn't happen because of a shortage of a raw material, or physics breaking Moore's law. It happened because big tech centralised power into a handful of gigacorporations - creating a handful of ultra-billionaires - who are enormously incentivised to centralise technology itself.
This could of course change if we stop electing known criminals/con-men, but the supreme court seems intent on strangling democracy by legalizing unlimited bribery.
All in all it doesn't look good
I don’t get this. It’s like worrying in 1960 that the companies that invented computers will hoard the benefits of computing. It doesn’t make any sense. There is no secret formula to any of this. The math underlying the models is widely known, and there are tons of competitors, including foreign competitors.