But income inequality is so bad because the particular distribution of wealth is inefficient in terms of societal well being. The problem with wealth inequality isn’t that rich are just too rich, it is the fact that poor people don’t need to be so poor.
However regarding Bill Gates losing 12 billion dollars the one person whose lifestyle won’t be significantly effected by this is Bill Gates. He will still have 5 billion left and an income in the hundreds of millions. Anything he wants to buy he can. Those 12 Billion dollars mean less to him than would $8,000 to any one of the 1.5 million households living in extreme poverty (less than $2 per day before benefits).
Oops - you just contradicted yourself on free markets, because fixing the system makes the market less free. And why do you think a free market would distribute wealth? If a set of people had some advantages that let them accumulate wealth faster then others, why would they share? Even if we grant that a totally free market would maximize the creation of wealth (highly doubtful) you still wouldn’t get a reasonable distribution of wealth. A regulated free market on the other hand can correct for the worst abuses.
Illegals definitely. But they don’t use services as much, being scared of dealing with the government. And we need to see how legal immigrants do over time. My great-grandparents were hardly rich when they came here; their children did much better. Immigration is an investment in a sense.
True, but if you import a lot of poor people who you have to support for a generation, that puts untenable pressure on your welfare state, if it’s generous. Our skimpy one can probably withstand the pressure, but if France or Sweden tried to import a huge immigrant population they’d be in a world of hurt.
So Europe, except for maybe the Brits, have taken the lesson to heart. In order to have such generous welfare states, they have to essentially turn their countries into gated communities.
Not only that, but it makes their GINI coefficient look better right now because they aren’t bringing in so many poor people.
And sure enough, the European countries with the least immigration have the least income inequality.
Adaher, it’s not a good idea to reduce public spending when the economy falters.Public spending doesn’t just bolster the economy, but it also enhances education, health, physical infrastructure and poverty alleviation, which are key to further economic and social development of any country. The only time you reduce spending is when the economy is riding high, like the 20’s, 50’s or the 90’s. Otherwise, spending should either remain flat or nominally increased.
That’s true, if you actually can spend, which in a recession means you have to borrow. It’s also dependent on you having run surpluses in the good times.
Keynesian theory has two sides on that issue: run deficits in bad times, surpluses in good. Doing only half of it is why it never actually works in practice in most places. Plus there’s the fact that like the Laffer Curve, no one really knows how much stimulus you need. It could be a small amount, it might be more than any country can realistically spend. All depends on what the multipliers actually are.
The solution to immigration isn’t simply to bar immigrants, it’s to make conditions in Third World countries good enough that nobody wants to leave them.
If you want to bitch and moan about HOW a person makes their billions that’s fine. The problem is that the GINI coefficient doesn’t care about how, only the amount. So what you’re saying is that income inequality isn’t a relevant issue. Two societies could have identical GINI numbers, one with lots of evil rich people, and one with lots of not-evil rich people, and you consider one of those societies better than the other.
Sure, most of those people are also in the top 1% meaning a further reduction in inequality, meaning people should be even better off. Yet no one here can explain how they’ll be better off.
Again, irrelevant. The GINI coefficient doesn’t include a weighting factor for “level of evilness.” He gets scored the same way as Buffett, the Koch brothers, and the Waltons.
Again, the GINI coefficient doesn’t care. Destroying Bill’s wealth will move the coefficient, and that’s suppose to make people better off. Since so many people claim that him gaining wealth made them worse off. I’d simply like to know how.
Nope, not confused at all. What you’re saying is that the actual GINI coefficient isn’t relevant, and that income inequality doesn’t matter. Since if Gates being a pauper tomorrow both of those metrics would improve, but nobody would be better off.
That is absolutely wrong. Just amazingly wrong. I’m not even going to bother addressing it, in the mean time, look up “free operating systems.”
No, again, holy fuck that is wrong. The $12 billion wasn’t a pile of cash that burned or someone stole. It was 500+ million shares of a company that people used to value at $33 and now value at $10, his wealth simply vanished, poof. He still has the 500+ shares, but they are now only worth $12 billion less. How do you not get that? Remember when Enron crashed, or the Tech bubble burst, or the beanie baby fad passed, the wealth is gone.
The issue at hand is that when his wealth vanishes, the inequality gap shrinks, which is supposed to make people better off, but that doesn’t seem to be the case.
I guess a few people might have been short MSFT, and they’d be richer, but not in direct proportion.
Nope, but they are they answers I expected from you. So now you’re claiming that him losing money increases the value of the US dollar, and that is going to make everyone better off? If you want to stick with that has your premise, than just like Voyager and Dangerosa you’ve shown that the GINI coefficient isn’t relevant.
Maybe most of the wealth is in the top 1%, but most of the people are not. They have 401Ks or mutual funds or are going to get money from a pension fund which owns Microsoft stock, and in that way become poorer.
Basically your whole OP is a strawman. GINI is just a metric showing inequality. To fight inequality we have to lessen actual inequality, not just change the metric. Destroying wealth does not make the lives of those on the bottom any better. You are accusing people who care about inequality or caring only about the metric, not the people, thus it is a strawman.
An anecdote illustrating this. When I was in grad school, my group and another group was in the basement of the CS building, and we each had PDP-11s. One day the air conditioning went out. We got issued a fan and a thermometer, with instructions to shut the machine down when the thermometer reached a certain temperature. We aimed the fan at the innards of the machine and monitored the temperature. When we went past the other group’s computer, we noticed that they had aimed the fan at the thermometer.
That appears to be your concept of inequality.
To make it explicit the GINI coefficient is the temperature, and your scenario is aiming the fan at the thermometer.