I’m in the top half of the top 1% for a 39 year old white guy in terms of income, not in terms of assets but… I grew up poor lol. I’m also one class short of a degree in econ from a halfway decent school and make my very decent living by being good at capitalism. I’m not even kidding to be me you have to be able to sell, negotiate, make a shit load of decisions correctly, be really good at estimating the probability of certain things happening in real time (because if you don’t those decisions are already fucked), solve/mitigate random often serious problems, and now manage a team of people reporting to me.
Look I’m fully cognizant of the fact that I’m a weirdo, and sound like one, but unfortunately I’m one of those freaky competent special interest weirdos. I’m basically one of the biggest actual business nerds you will ever encounter. Not esoteric academic bullshit, not imaginary tech cloud castles of potential, actual real world tangible economies of scale business. Trucking, manufacturing, food distribution, these are all topics I’m paid a lot to be an actual real world expert in.
R>G = we are moving back toward feudalism. That’s what I need you to accept and then comprehend the ramifications of. Not because that’s all there is to understand, but so that you can understand that when things are trending down you’re going to make a new record low every year. It’s kind of like how every year is going to be the hottest year of our lives from now on. That’s what trending down means.
Also know that this has happened plenty of other times in history and it generally either ends with a new/reformed system or a series of revolts. Nothing just goes on forever. We’re in the late stages of this one because we’ve reached the point where the math starts to really break for the people at the bottom and the number of people down there grows large enough to become a real societal problem.
Mulling on this a little more, I think it’s a fair claim that the GOP is using anti-trans stuff to split off people who are OK with lesbians and gay people but for whom trans acceptance is a bridge too far.
I don’t day trade, I value invest my IRA. Poker is work, and I’m not making enough money to save up and buy a house. I make what used to be comfortable middle class money.
I worked for several years as a sports broadcaster/reporter, never made more than $13K in a year off it. I did public relations, web design, and ghostwriting on the side. For a while I was working 1-2 non media jobs and 2-3 media jobs at a time trying to piece it together. When I got into poker, I was working at the ghostwriting job still to pay off the credit card debt from chasing the sports media dream, while keeping that alive with one job still in the industry.
There were many nights I fell asleep at the keyboard writing, and woke up having written a sentence or two in my sleep.
So yeah I’ve been on the wrong side of the leverage and money a lot, and I have learned first hand what that experience is like. I’m currently on the wrong side of it in the housing market, which is a driving factor in keeping me from climbing the ladder.
That’s really hard to do without actually improving things for people who are struggling.
By that I mean, it’s hard for a Democrat. That’s why Trump is polling so well on the economy. Republicans are in a cult. If Trump were in the White House, Republicans would be going nuts touting unemployment and stock market numbers. And it would work on them, because, again, cult.
With Democrats, it’s different. Biden can’t just say “I’m great and doing great things” and have people believe it the way Trump/Republicans can.
My comment about people having the memories of goldfish? That’s exactly why Biden shouldn’t be messaging too much about the economy. Because for so many people, the Biden economy = inflation. Reminding them of that is shooting yourself in the foot.
I agree they think this is a wedge issue but the fact that they’ve basiclly dropped the bathroom panic and the women’s sports panic is pretty good evidence that these aren’t actually (effective) wedges
but you’re on to something, the fact that they keep doing this button mashing outrage of the week is them searching for domestic policy wedges. whatever chris rufo is doing any given week is the current theory of the next big wedge issue but they’re whiffing a lot lately
Reminding them that “the Biden economy = inflation” is untrue is important though, precisely because people are morons. Not arguing against the propaganda is weak tight old man coffee play, and it’s low variance but wrong.
Honestly the biggest problem is that there’s a section of the left seemingly programmed to say the sky is falling at any given time… and that puts more doubt than anything else into people’s minds.
Yeah, I pretty strongly disagree with this. It’s not just die hard Republicans who are 30-40% of the country who think Trump is better on the economy. It’s lots more than that, per the polling.
This seems almost self-contradictory. Inflation was bad a two years ago. It’s under control now. Do people have long memories or not?
In general, thanks for this, it is a more debatable post than most in this thread and I don’t want it to be ignored or lost. I think it’s possibly going to be a whole new derail if we start debating Piketty but I am ok with seeing how it goes.
In general yes, R > G leads to increasing inequality, BUT there are a lot of caveats. It’s not a highway to feudalism.
Many mainstream economists point out that the equation only leads to inequality when considering net (of depreciation) return on capital but Piketty’s data did not differentiate between gross return and net return.
It’s worth noting that our richest people today are not Rockefeller, Getty, and Carnegie. They’re people who accumulated capital within their lifetimes and while social mobility is less than I’d like we don’t have a sort of permanent dynastic aristocracy that has developed through accumulation of capital. I don’t think this will really change about our society. Buffet and Gates aren’t leaving massive generational wealth to heirs and the narcissism that is necessary to accumulate the vast fortune may also lead the wealthiest to want to donate / spend much of it in their own lifetime rather than leave the fate of their fortune to their kids. Index investing is an interesting wrinkle here because getting returns from capital with minimal risk is a lot less work than it ever was in the past.
Also as JMan pointed out, Musk today isn’t really richer than Henry Ford was in the 1940s. On the contrary, the bottom 25% of today’s society have a standard of living much much better than the bottom 25% of the 1940s.
We still have New Deal programs like Social Security and FDIC, we also have great society programs like Medicaid, those haven’t gone away. I don’t think it’s really just the distance between the richest and poorest that leads to upheaval and revolution but that overall standard of living for the poorest. If people are fed and housed and they are able to get jobs I don’t think the house is going to collapse.
The data shows real wages are growing and as I’ve said upthread I think we’re still dealing with lingering issues from pandemic era supply shocks. I think things will get better by just staying the course, I also don’t think there’s a permanent downward trend in standard of living as you are claiming. I am open to hear you elaborate on that, but it’s going to take more than r > g = permanent downward trend. After all, as you’ve said the r> g has basically been an aspect of our society since WWII and we haven’t been on downward trend even considering additional factors beyond income inequality like globalization and offshoring of labor
The Carnegies are worth $10.3B, Getty’s $5.4B, and Carnegie gave his away. I’m not sure that these families being worth $5-10B instead of $200B really makes a big difference here.
And also not sure what Buffett and Gates giving theirs away really proves about our system.
Buffet’s kids are getting $2.5B each for their foundations, I’m sure they’ll get at a nice piece of that over time.
Yeah but those numbers are less than the previous generation. The capital accumulated doesn’t make them into the equivalent of feudal lords. One of Piketty’s conclusions was that
In an economy where the rate of return on capital outstrips the rate of growth, inherited wealth will always grow faster than earned wealth.
Instead what we observe is that inherited wealth has a dilution and decay as it passes through generations. R > G isn’t creating some permanent overclass of families who achieved an escape velocity.
As an aside I also wanted to add the Howard Buffett is giving massive amounts of his money to Ukraine as a private citizen.
I didn’t know that stat, thanks. It is sad. I still wonder if it is related to pandemic era things like maybe a backlog of evictions due to the moratoriums.
I still feel that should be an opportunity for Biden to do something like praise the employment numbers but also mention that there are issues in the economy causing things like homelessness and provide specific policy proposals to deal with what he believes is a root cause. I don’t think it’s a reason to avoid talking about the economy altogether and cede ground.
So that adjusts for inflation but doesn’t look like it adjusts for ratio of wealth owned by one person to wealth owned by everyone else. That’s the stat that matters in this argument about haves and have nots.
I feel like it’s kind of a tightrope walk for Biden, because while the truth is that it’s a complicated issue with lots of nuance to it (as demonstrated by the discussion ITT), ain’t nobody want to actually hear that outside of nerdy Twitter pundits and folks in places like here, that mostly are mortal locks to vote D anyway.
The GOP loves to go with messaging that issues are very simple and black-and-white, and it works really well with not only their base but a lot of low-info folks in no man’s land that don’t get the nuanced stuff, and don’t really want to learn it. Democrats need to try to reach out better to that crowd, but in the case of the economy, it’s gonna mean putting away the whiteboards and graphs and just coming up with some pithy semi-bullshit stuff that resonates well.
Are they shifting away from McDonalds because they’re making meals at home? Because if so, that’s a fantastic result. When I went grocery shopping last weekend, I bought a week’s worth of food for my wife and I, plus some extra items for roughly $70 (much healthier food than McDonalds too). One of the biggest wastes of money in the US economy is our addiction to fast food and fast casual restaurants.