Also, though, I think some of the weird poverty-culture stuff of the Netherlands is just a culture thing. Netherlanders are absolutely rich enough to buy paper towel if they wanted to, it's just a cultural thing that they don't. And air conditioning is a whole cultural hot button flashpoint issue for reasons that have nothing to do with money.
I always thought “third world” countries were trying really hard to improve their economies but just failing for various reasons.
Turns out living in those places can be more than great if you’re rich and there’s actually lots of people in power who are actively trying to increase inequality and maintain a permanent underclass.
Of course what clued me in was the increasing success of that project by the equivalent group of people here in the US.
But you hit on an important point that wealth cannot accumulate unless consumption is disciplined. Sometimes discipline is self-imposed (e.g. calvinists), other times by the organizing authority (e.g. state, church).
In the 2nd type, authority as the source of discipline, there’s debate on the right balance of disciplining the elite classes vs the under classes. This debate will never cease, as long as there are human beings consuming wealth.
Wealth has lots of flavors but usually we mean material wealth.
Material wealth is the items and properties that people covet. And people figured out they can store wealth with money and everyone agreed that money is a fair way to store wealth and use it to transfer ownership of the items and properties people covet. (In hindsight maybe not wisest of all decisions but open for debate).
Material wealth is not permanent. It is consumed. By typing on my iPhone, using it daily, it’s degrading, eventually it’ll not be functional and it’ll be harder to get money in exchange for it. Real estate appreciates in monetary value but that’s an effect of the money system not a natural state of things, real estate actually degrades without real work put in to keep it up, consuming value. Food and fuel are easy to see as consumables, one-time use only.
Calvinists are historically frugal, their theology emphasizes thrift and industry, basically the backbone of capital accumulation - create wealth, but don’t consume it, invest the wealth to create more wealth. This is the bedrock of “capitalism” (capitalism in modern and postmodern age has taken a new meaning, but originally it meant ~using capital to create wealth).
China famously imposed (and still does) very strict discipline on consumption, and they used their excess capital to reinvest for industrialization.
Western economies imposed consumption limits in the continental wars, which enabled a huge surplus of wealth in USA following WW2 because the population was used to the discipline.
Churches (Vatican) accumulate treasures by disciplining their flocks to tithe. Churches in the east were looted by the Bolsheviks to finance their revolution, the eastern church had huge reserves of wealth that was consumed by the revolution. Eventually they had trouble balancing their economy and the holodomor took hold in the wheat belt - the wealth was exhausted.
The soviets eventually established absolute control, disciplined their populations and went on a long run of impressive industrialization and growth - but it eventually toppled due to imbalances in production and consumption, people don’t thrive under strictest disciplines, they grew tired and the economy got sick.
Today, the highly developed nations in the west are wrestling with questions of discipline. Wealth inequality its called. There’s an upwelling of popular sentiment that people want to consume more, and it’s hard not to sympathize with that, Id love to live like the elites do. But from my perspective there’s not much consideration to how much consumption is sustainable or desirable.
The key question from my view is what end does material consumption serve?
Is it for pleasure’s sake alone? Or is it to unlock more human talent? Is it converted to unleash other flavors of wealth such as spiritual fulfillment, thriving families, arts, wisdom? How can a material value be placed on these things in balance with real material constraints? More questions than answers, and that’s sort of the crux of the eternal argument.
Obviously things have gone well in the west, most people live lives of extreme wealth compared to their great-grandparents. Some of that has to do with warfare, some with luck, some with thrift and industry. Maybe that’s about to change, or maybe not. I for one am happy to work harder than most to create wealth, I find work fulfilling, but I am also well compensated for my labor and so I consume more than most people too… the balance happens at the micro-level and the macro.
The Netherlands does redistribute more, but the main reason China is less equal is that China is a massive, developing country with huge divides between rural and urban areas, and between east and west.
Uber alone supposedly has 1M "independent contractors" in the US. Quick google searches would put them as the 3rd biggest employer in the US behind Walmart & Amazon, if they were actually classified as employees.
I’m not saying that you meant to say that it’s our first round with this…just pointing out that Americans have significant experience at maintaining a underclass.
Arguably migrant workers working the harvests on farms is similar and bridges the Jim Crow era to now, but that has been more behind the scenes and didn't have the veneer of "tech".
in Canada they use Temporary Foreign Workers, but it's the same idea. Import the developing world inequality instead of using locals -- but only because the population base isn't there.
Poor countries also reduce wealth inequality. In fact, China went through a Communist revolution where all private landowners’ wealth was taken from them. This happened from the 1930s through the 1950s and was a fairly bloody, violent process, involving lots of revolutionaries inciting peasants to forcibly occupy land and buildings and killing landlords if they didn’t cooperate.
Netherlands was the poster child of the "Dutch Disease"[1].
They in some ways could've turned into Qatar (and Norway into Aramco) without the right people twisting a few dials at the right time.
In Canada there are people making peanuts and living very poorly while technically inequality is low. The problem in Canada and other developed countries is excessive taxation of salaries. That's an orthogonal to wealth problem.
I'd argue it's part of the same problem. Salaries are excessively taxed in developed countries because wealth is so lightly taxed. People with wealth have outsize influence in law and policy. They can make all sorts of fancy arguments for why taxing wealth is bad. But money for government services has to come from somewhere.
So regular working stiffs end up screwed.
The reason why nannies are affordable in China is because those nannies aren't paid very much, and consequently enjoy a much lower standard of living than their employers. In Netherlands, nannies are relatively expensive, but you the employee is much closer to the socioeconomic stratum to that of their employer.
Same goes for the other examples in the article. The author, having a fancy car, modern phone, etc, clearly enjoys a high level of wealth and is able to leverage that wealth to acquire goods and services at a high level. But that only works if there are people willing to provide those goods and services for a price that he can afford. The author didn't mention that the people who provide these goods and services do not enjoy the same benefits of those goods and services: their nanny cannot afford to hire a nanny, nor a Chinese EV, nor a giant smartphone.
The Netherlands has made the intentional decision to reduce wealth inequality and to achieve a fairer society. You can agree or disagree with that decision. But if I had to choose between NL and China, being cast into one country or the other without any choice about where in that society or what level of wealth, NL would be a much better option.