Income inequality in America: the viral video

[John_Mace]

@Princhester

No I can’t show you the math. Let’s say MS puts out a product which earns $51M and that was worked on by Joe, Bob, Fred, Michael, Steve, Susan, Peter, Mary, Sally and Jane and also Bill, who did some work on the product and owns the company. Let’s say the first ten guys get $100k in salary each and Bill gets $50M. Can you show me the math that says the value Bill put into the product was $50M and the value they put in was $1M collectively?

Your art example falls flat on its face because only the artist worked on it. Now if the painting was a collective effort by Joe, Bob, Fred, Michael, Steve, Susan, Peter, Mary, Sally and Jane and also Bill, who did some work on the art and owns the production company, then you might have a good example. But then you know what I’d say about the situation, right?

Oh, really? Who made the paint, the brushes, the canvas?

The fact is, you are throwing around the term “value” as if it is objectively definable at some level. It’s not. And so your statement about relative value produced vs income received is completely subjective. If you can’t show your math, then it would be nice if you admitted that you made a mistake. We all make mistakes, so there’s no shame in admitting one. In fact the shame is in not admitting one in the face of facts that prove otherwise.

[Princhester]

@John_Mace

Oh, really? Who made the paint, the brushes, the canvas?

Quantitatively, I don’t think that the person buying the painting probably sees much value in these things. So the value put into the painting by the person who made the paint, brushes etc is de minimus. Contrastingly, when I buy software I care a lot about the thought and effort put into it by the designers and coders. They bring essentially all the value (to me) to the table.

On the other hand, ignoring proportion and just being absolutist about it, you have a good point. Even artists don’t create all the value in a painting. So I’m even more correct in the point I’ve been making than I thought. Thanks for pointing that out.

The fact is, you are throwing around the term “value” as if it is objectively definable at some level. It’s not. And so your statement about relative value produced vs income received is completely subjective. If you can’t show your math, then it would be nice if you admitted that you made a mistake. We all make mistakes, so there’s no shame in admitting one. In fact the shame is in not admitting one in the face of facts that prove otherwise.

Firstly, what nonsense: I have never said value was objectively definable at all. On the contrary I embrace wholeheartedly the idea that the relative value that each person at (to continue the example) MS brings to the company is subjective.

Secondly, that crashing sound is your glass house coming down around your ears, echoing in the hall of empty triumphalism in which your post lives. My point in the post you quote is that your position is as subjective as mine: you essentially admit this by failing to provide the math to support your position as I’d asked you to. And all while demanding that I provide the math to support mine.

[Trinopus]

@Algher

Did you ever use Wordperfect before MS Word came along? It was crap, a pain, hard to deal with . . .

Um…yes, and no. You’re dead wrong there. WP was superior in quite a few ways. Even after all these years, I bemoan the loss of “Reveal Codes.”

[BrokenBriton]

@septimus

I think you can get part of the answer by reading some of the “pro-inequality” comments made by Americans in this thread. I’ll guess many of those commenters are themselves not even rich.

A comparison of American and Western European values may be informative. 49% of Americans agree with the statement, “Our people are not perfect, but our culture is superior to others;” but only 27% of French agree. 69% of Spaniards think the state’s social safety net is more important than individual freedom from the state; this is almost reversed in America.

You’d be incredulous, but then there’s the health care example where so many in the US wanted the diametric opposite of what was plainly in the best interests of themselves, and generations of their families.

I guess it’s just a testament to the extent of ingrained indoctrination.

[Algher]

@Trinopus

Um…yes, and no. You’re dead wrong there. WP was superior in quite a few ways. Even after all these years, I bemoan the loss of “Reveal Codes.”

Huh - then why doesn’t it exist any more?

Oh yeah - they didn’t keep up with the times, and were beaten by a better product.

I don’t miss WP one little bit, and I hated working with companies that used it way back when.

[Algher]

Value in a product is easy to define - it is what the market will pay for the product. Overprice it, and you will be scooped by someone else. Google Docs is free, and can handle MS Word files, yet it still has not won.

Value in a company is also easy to define - it is the value of its shares (market cap).

Value of an employee is easy to define - it is what the employer is willing to pay to keep the employee around, without fear of losing them.

Value of a founder / CEO (e.g. Gates, Zuckerberg, Musk, Jobs, Ellison, McNealy, Benioff) is interesting, because they set their own pay levels in the early days, and reap the benefits later. Each one of them took a risk, could have lost it all, yet won. The list of those who ran shops full of code writers who died is much, much longer. So, yes, there is SOMETHING about the winners that sets them apart, and I think that it is more than just luck. As a shareholder I am happy to see them make money as I draft along behind them.

Plenty of coders, in the end, provide zero value to the marketplace as objectively proven by dead projects. Their bosses are just as guilty, and often lose some of their own money. Once again, I have flushed millions of dollars of other people money down the toilet with ideas and code that never came to fruition. I flushed a fair amount of my own cash as well, in hopes that it might pay off.

We have a capitalistic system that is fairly efficient at both determining value of a product and value of an individual from a capitalistic perspective. What we need to focus on is ensuring that everyone has the chance to hit the level of value they are capable of, and that they are willing to work towards. We also need to ensure that there is a minimal floor.

None of this has much to do with the market cap of Facebook or Microsoft, or the percent of that market cap owned by their founders.

[Evil_Captor]

To add another word processing anecdote, way back when I worked at a company that had a proprietary word processing program that ran on the word processors the company bought at a cost of hundreds of thousands of dollars. At home I had a little program called “Kwik Write” for my Commodore 64 that could do pretty much everything that I ever called on the expensive company word processor to do. It cost about twenty bucks.

I do not think there would have been any shortage of companies that could come up with good word processors if Microsoft had not been around. Au contraire.

I use Open Office now. Great program!

[HurricaneDitka]

@CannyDan

At some values of X and Y there will indeed be a “redistribution”. And if that redistribution isn’t arranged amicably, then it will be bloody instead.

OWS and wealth-redistribution-aficionados seem to make these eerie quasi-threats / predictions. I think they imagine a do-over of the French revolution, where we line up all the aristocrats and guillotine their asses. It wouldn’t work like that. If there’s ever a wealth-redistribution mob-violence action, the blood would primarily be poor rioters.

“Wealth equality” isnt’ the be-all and end-all. Let me paint a couple of scenarios:

Option A: you can live in some poor North-Korean-esque country and you could go to sleep on my dirt floor with your worn wool blanket every night and an empty stomach, but you’d have the knowledge that all your neighbors and everyone in town was also hungry and cold and uncomfortable, because we had better “wealth equality” than America.

Option B: you can live in America, where there are some gazillionaires with ten cars, three yatchs, five houses, a summer cabin, and a vacation home in Mexico, and basically everyone can get food, a cell phone, a microwave, refrigerator, and free education. Cable TV is quite common and internet access is widely available. Oh, yeah, and wealth inequality is through the roof.

Which option would you choose?

[CannyDan]

@HurricaneDitka

Option A: …

Option B: …

Which option would you choose?

Are you going for an award for using the greatest extremes in crafting your ‘fallacy of the excluded middle’ argument? Here’s your ribbon!

[HurricaneDitka]

@Evil_Economist

I admire the amount of willful ignorance it takes to claim that minimum wages increase unemployment in the face of dozens of threads we’ve had here showing that they don’t.

If minimum wage laws don’t increase unemployment, then WTF are we doing farting around with single-digit limits? Let’s make it $25/hour, or $100/hour, or hell, let’s all become Mark Zuckerbergs and make it $14B/year.

[Evil_Economist]

@HurricaneDitka

If minimum wage laws don’t increase unemployment, then WTF are we doing farting around with single-digit limits? Let’s make it $25/hour, or $100/hour, or hell, let’s all become Mark Zuckerbergs and make it $14B/year.

deleted

[Evil_Economist]

@HurricaneDitka

If minimum wage laws don’t increase unemployment, then WTF are we doing farting around with single-digit limits? Let’s make it $25/hour, or $100/hour, or hell, let’s all become Mark Zuckerbergs and make it $14B/year.

Pretty please, with a cherry on top, understand the concept of excluded middle before participating in any more debate topics. Your arguments are silly and do absolutely nothing to win anyone over to your side or to impress anyone with the depth of your thought.

[HurricaneDitka]

@Evil_Economist

Pretty please, with a cherry on top, understand the concept of excluded middle before participating in any more debate topics. Your arguments are silly and do absolutely nothing to win anyone over to your side or to impress anyone with the depth of your thought.

I understand that there are other places to live that fall in between the two extremes. I’m not claiming there aren’t. I’m claiming that I (and a lot of reasonable people) care more about the standard of living they can attain in a place than how inequitably-distributed that standard of living is.

[HurricaneDitka]

@Evil_Economist

Pretty please, with a cherry on top, understand the concept of excluded middle before participating in any more debate topics. Your arguments are silly and do absolutely nothing to win anyone over to your side or to impress anyone with the depth of your thought.

If $5/hour is too low for minimum wage, and $7 is better, and $9 is better still, why not $14, or $25? Wouldn’t that be even better yet?

[Jas09]

@HurricaneDitka

If $5/hour is too low for minimum wage, and $7 is better, and $9 is better still, why not $14, or $25? Wouldn’t that be even better yet?

Maybe and probably not, respectively. Any more questions?

[CannyDan]

@HurricaneDitka

I understand that there are other places to live that fall in between the two extremes. I’m not claiming there aren’t. I’m claiming that **I **(and a lot of reasonable people) care more about the standard of living they can attain in a place than how inequitably-distributed that standard of living is.

Bolding mine.

Indeed, SELF interest is rarely equivalent to SOCIETAL interest. We are all free to pursue our own best interests, to quite a large extent. This thread though is pointing out the probable consequences when self interest vastly overwhelms societal interest.

[Human_Action]

@HurricaneDitka

I understand that there are other places to live that fall in between the two extremes. I’m not claiming there aren’t. I’m claiming that I (and a lot of reasonable people) care more about the standard of living they can attain in a place than how inequitably-distributed that standard of living is.

In other words, the absolute matters more than the relative. I agree.

[Algher]

@CannyDan

Bolding mine.

Indeed, SELF interest is rarely equivalent to SOCIETAL interest. We are all free to pursue our own best interests, to quite a large extent. This thread though is pointing out the probable consequences when self interest vastly overwhelms societal interest.

What probable consequences? The only thing we have so far is the fact (I will accept as a fact) that the WEALTH distribution in the US is vastly different from what is expected or desired in a survey of the American public.

We have also argued over the value that someone might provide, and how much value they should be allowed to collect / keep.

[eschereal]

@Algher

… Each one of them took a risk, could have lost it all, yet won…

Which is a semantically interesting aspect to our capitalistic system. I once saw a guy put $500 on 34-Black and go home with an impressive wad of dough. The functional difference between risk-taking in business and other forms of gambling is pretty difficult to discern. Some good, honest people work hard, take risks and fail miserably, others become brazillionaires. So, the rewards of success are at least in part entirely arbitrary and, at the scale of the super-rich, rather in excess of the value they represent.

[Algher]

@For You

Which is a semantically interesting aspect to our capitalistic system. I once saw a guy put $500 on 34-Black and go home with an impressive wad of dough. The functional difference between risk-taking in business and other forms of gambling is pretty difficult to discern. Some good, honest people work hard, take risks and fail miserably, others become brazillionaires. So, the rewards of success are at least in part entirely arbitrary and, at the scale of the super-rich, rather in excess of the value they represent.

Agreed completely that luck is a factor. Timing, chance meetings, etc. can really make a huge difference. However, you can’t GET lucky without putting the money down with a willingness to lose it. That willingness to risk is one of the first differences between an entrepreneur and an employee.

As for excess in the value they represent - why? What is your measurement, other than some gut check? Are you saying the Zuckerberg does NOT deserve to own a sizable percentage of Facebook as the Founder/CEO? Or are you having an issue with the fact that his percentage is worth $ billions because of the nature of the stock market?