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If inequality continues to grow at current rate, richest Americans will own 100% of US wealth in 33 years


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#21
ralfy

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What I mean is that much of the wealth of the rich consists of numbers in hard drives, and the value of that wealth is maintained only if more people borrow and spend. Which they can't do if the rich own all of the wealth.

 

This still doesn't address my point:

 

 

o, the rich will own 100% of the wealth and everybody else will pay rent.

 

 

Of course, if workers are completely automated out of their jobs by AI and robots, then even that wouldn't be sustainable.  Until then, workers can trade in their labor power to pay rent and service their debt borrowing.

 

Not that I like this decidedly dystopian scenario...

 

The other thing is that even if the rich "own" all the monetary wealth, workers can still trade with each other, if only through barter.

 

Finally, I can't see he middle class losing all the equity in their homes.  I would think this form of wealth would prevent the "rich" from owning 100% of the wealth.

 

Still, younger families could easily lose the ability to borrow to buy their own homes, forcing them to rent or to continue to live with their parent.  Their only hope of ever owning their own homes might very well be through inheritance.  I suppose eventually the rich might enact steep inheritance taxes that would apply to residential homes only in order to force sale of even that modest level of wealth.  I can see voters going along with that because at least politicians will continue to pay lip service to white privilege, stopping immigration, preventing abortions, protecting "gun ownership rights" etc.

 

Again, a very dystopian view of the future.

 

 

You need wealth to pay rent. If 100 pct of wealth went to the rich, then you won't have any wealth to pay rent.

 

You also have no labor power to sell if you're automated out of your job. And the rich won't have anyone to buy their goods because you don't have wealth to buy those goods.



#22
tomasth

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global market , so they can have others to pay them.



#23
caltrek

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You need wealth to pay rent. If 100 pct of wealth went to the rich, then you won't have any wealth to pay rent.

 

Labor power creates wealth.  Rent is a method of immediately siphoning off that wealth before it can be accumulated by those paying rent. That, and preventing accumulation of wealth because of payment for basic goods and services such as food, clothing and health care.  That would include servicing debt incurred to pay for such items. 

 

 

You also have no labor power to sell if you're automated out of your job.

 

Yes, as I have already said:

 

 

if workers are completely automated out of their jobs by AI and robots, then even that wouldn't be sustainable.

 

 

Still, we are not there yet, at least not in regards to all of those who have no, or at least very little wealth. 


The principles of justice define an appropriate path between dogmatism and intolerance on the one side, and a reductionism which regards religion and morality as mere preferences on the other.   - John Rawls


#24
caltrek

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global market , so they can have others to pay them.

 

Yes, another complicating factor.


The principles of justice define an appropriate path between dogmatism and intolerance on the one side, and a reductionism which regards religion and morality as mere preferences on the other.   - John Rawls


#25
ralfy

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global market , so they can have others to pay them.

 

Except that the U.S. is a democracy, which means the populace has to be kept happy. Which is exactly what happened.



#26
ralfy

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global market , so they can have others to pay them.

 

Yes, another complicating factor.

 

 

Not exactly, because what applies to the U.S. also applies to the global economy.

 

In the end, there can never be a capitalist system where all wealth belongs only to a few, as much of that wealth essentially consists of numbers in hard drives whose value is maintained only if production and consumption increases. There's your complicating factor.



#27
ralfy

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You need wealth to pay rent. If 100 pct of wealth went to the rich, then you won't have any wealth to pay rent.

 

Labor power creates wealth.  Rent is a method of immediately siphoning off that wealth before it can be accumulated by those paying rent. That, and preventing accumulation of wealth because of payment for basic goods and services such as food, clothing and health care.  That would include servicing debt incurred to pay for such items. 

 

 

You also have no labor power to sell if you're automated out of your job.

 

Yes, as I have already said:

 

 

if workers are completely automated out of their jobs by AI and robots, then even that wouldn't be sustainable.

 

 

Still, we are not there yet, at least not in regards to all of those who have no, or at least very little wealth. 

 

 

Labor power only creates wealth if what it produces is sold. How can those goods be sold if all of the wealth goes only to a few? And how can all wealth go to a few if some of it has to be used to pay for labor power?

 

To recap, when one argues that 100 pct of wealth goes to a few, then that means everyone else will have no money. If the rich hire people to work for them, then some of that wealth will now go to laborers, which means the rich will no longer own 100 pct of the wealth.

 

If the rich decide to have robots to produce goods, then who will buy those goods if no one has wealth to buy them?

 

On top of that, much of that wealth consists essentially of numbers in hard drives representing what are essentially promissory notes. That wealth maintains its value only if more people borrow, earn, and spend, but that can't happen if 100 pct of wealth goes only to a few.



#28
Jessica

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I believe the best way to even the playing field are:

1. To use the monopoly busting anti-trust laws.(Clayton laws) on walmart, twitter, facebook, google, etc.

2. Limit copy right in some way. The above companies use such laws to their advantage to take over their industries. How about 75 years for solid objects and 10 years for digital?

3. Tax the rich to pay for jobs and infrastructure programs. This would benefit the little guy if focused within the lower to lower middle classes of our society.


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#29
ralfy

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That can be done if the government can control the rich. But what has been taking place in the U.S. is the opposite.



#30
caltrek

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Just a few more thoughts that I thought I would add.  Not to contradict ralfy, or others, but just by way of forwarding the discussion a bit.

 

One source of confusion is what do we mean by "wealth"?

 

I my previous posts, I equated wealth with that which is generated by labor power.  In Marxian terms, that would be a synonym for "exchange value".  Exchange value is separate and distinct from "use value."  One can have "use value" in the sense, for example, access to fresh water.  However, if one can not trade that wealth on a market, It is a right.  The water may be owned by another who permits its use, or it may be held in common by a government or other overarching institution. It is not a form of wealth that has exchange value, unless such overarching institution places it on the market for sale. 

 

Having access to fresh water is, in turn, different from having water piped into one's house.  Such piping, at least at the present level of technology, requires labor power. There may also be treatment involved to ensure that the water is potable. That also typically involves labor power.

 

There is also the question of debt.  If my liabilities exceed my assets, then some might argue that I actually have negative wealth. One can envision a whole economic class that actually has not zero wealth, but negative wealth. 


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The principles of justice define an appropriate path between dogmatism and intolerance on the one side, and a reductionism which regards religion and morality as mere preferences on the other.   - John Rawls


#31
caltrek

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Is all wealth essentially located on a hard drive?

 

Only if one thinks of a deed of trust to a home as being "on a hard drive."

 

Stocks are secured by assets owned by a company, as well as an anticipation of future earnings.  Much of those assets can be quite physical in nature.  They can include productive machinery, homes, office buildings, commercial establishments, etc.

 

 


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The principles of justice define an appropriate path between dogmatism and intolerance on the one side, and a reductionism which regards religion and morality as mere preferences on the other.   - John Rawls


#32
starspawn0

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Wealth is becoming increasing about "options to use".  Streaming services are an example:  you "own" an account, and can use the service to view videos whenever you want; but you don't own the computer in the cloud, itself. 

 

I think this will become increasingly common, as there are limits to physical space to contain the things we own.  Yet, the economy demands we keep buying more stuff.  Either the objects will have to get smaller (e.g. virtual); or, we will have to find some way to compress them down, to where they don't take up the physical space we inhabit.


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#33
starspawn0

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I confess that power imbalances are my main worry concerning inequality.  However, I personally don't get that worked-up over money; my personal worries about inequality and power are as follows:
 
I always feel a twinge of foreboding whenever one of my colleagues produces an important piece of work that wins praise and prizes.  I don't get jealous, but think, "Oh, no!... that means his group will have more power over whom to hire, and what grad students and postdocs to accept.  It also means that more will be expected of everyone else -- you will be expected to produce some good bit of work, too.  If you don't step up to the plate, you will get marginalized and/or forced to teach more."  People go nuts about prizes and acts of "genius"; and that translates into giving power to those who have won them.
 
I wouldn't call my reaction to the shifting power and expectations "fear"; just "foreboding".  I think about the possible futures, and see dark clouds brewing on the horizon.
 
Something similar happens in the economy.  But I am a little too selfish to personally worry about it -- my concerns are focused on the small world of academics that I inhabit.  Still, I think people should take seriously how wealth inequality translates into power imbalances.
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#34
caltrek

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I had a friend once who also was from an academic background.  (I say "once" because I have lost track of him).  StarspawnO's post very much reminds me a one of his many themes.  That is, the capacity in academia to fight over what others might regard as extremely trivial things.  Parking rights, for example.

 

Speaking of parking rights, I had another female friend who worked as a secretary for the court system. Those in charge of parking allocation tried mightily to impose rules on this scarce resource, only to be constantly thwarted, in part, due to my friends resourceful counter response.  These would be monopolists of quality parking would periodically change the system in an effort to have a truly stratified system of parking rights.  One in which judges would have preferred spots and would be at the top of the pecking order.   Others would be allocated spaces due to one method or another.  

 

Now, every time the would be monopolists would change the rules, my friend had a simple response.  She would go to a judge who favored her (she had a well developed sense of justice that appealed to us all).  Said judge would issue her a permit of the most desirable type. Presto, the defeat of the monopolists intentions.  Nothing like having a judge in your corner who outranks the regulators.

 

Such examples of power are the sort of thing that economists have a very hard time dealing with.  For the most part, they prefer numbers and algorithms.  These sorts of examples are more the sorts of things that sociologists love to explore.  Yet, these sociological studies do little to help economists break things down into quantifiable terms.  Sure, you can say that there were X number of Nobel prizes handed out this year, but that does little to tell you what those scientific rewards were all about, or what trends they might indicate.  I suppose that may very well be a difference between AI and human intelligence.  AI is very good at processing quantifiable data. Humans much better at making qualitative judgments. 

 

Of course, the thing about quantitative analysis is that such brute force reasoning can come to seem very much like qualitative analysis.  But that only comes when computer sophistication is very far advanced.


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The principles of justice define an appropriate path between dogmatism and intolerance on the one side, and a reductionism which regards religion and morality as mere preferences on the other.   - John Rawls





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