This article provides paragraph after paragraph of supporting data that the richest have gotten richer, but none that I can see supporting its claim that “billions of poorer people across the world have seen their wealth standstill or decline”.
The issue is simple to understand: as population grows and technology grows even faster, there should be a steady stream of wealth increase. This has been observed as is obvious to everyone. However, if we allow the bulk of this wealth to be controlled by a tiny part of the population, we are creating a huge problem to current and to future generations. A hereditary oligarchy can be terrible to our civilization, and this is what we see forming nowadays. I am not against people participating in the creation of wealth and reaping the rewards, but these differences in wealth need to be leveled over time. Unfortunately, short-sighted politics of the US and other countries are giving more and more power to wealthy people so that they can amass more money without visible contributions to society.
It's way simpler. As population grows, the 500 richest people (whoever they are) are expected to get richer even if the wealth distribution does not change. And as the society gets richer, they are expected to get richer too.
So, if there is any indication that wealth has been accumulating faster, it is not on the article. And as such, the article is valueless and a complete loss of time.
The indication you're searching for is called wealth inequality. It is a measure of how much more money the richest people have compared to the rest of the population, and it has increased significantly over the years:
There is an economist called Thomas Piketty who has made his name by studying and measuring inequality over the years. Read his book and you will get a detailed analysis of how inequality has increased in our society.
If me and the rest the million other people in my city have $100,000, some billionaire in a city somewhere else making another 100 million doesn't really have any impact on me directly. Yet it increases this inequality metric and I'm supposed to be outraged.
If the billionaire was using this position to corner the real estate market I'm trying to buy a house in, then I might be upset. But, I could also pool 1,000 of my friends together each with our $100,000 into a corporation and corner a market as well.
So why exactly is inequality relevant? Shouldn't we be focused on just raising where the bottom of the income range is rather than cutting down the tall outliers?
It seems to me like trying to make yourself wiser by killing everyone with more education than yourself.
Because democracy stops working when inequality is too great. Regulatory capture and all that.
It's waaaaay harder for you to organize and mobilize your 1000 buddies than it is for 1 billionaire to decide he wants to do something you don't want, such as lobbying politicians to give him a tax break, for example.
It's not as hard to organize people along ideological boundaries as you might think. Look at the power of the US political parties, the NRA, unions, etc.
If we want to stop regulatory capture, stop that. Don't worry if it's one person or 1000 behind a movement.
Wealth and income inequality are only bad insofar as they have an effect on consumption inequality and leisure. (Another issue is that wealthy people may use their money to get politicians to pass laws that are harmful.) When people who are richer than you spend their money on yachts, the resources (labor, materials) used to build the yachts can't be used to provide other people with cars, food, homes, computers, and drinks from Starbucks. Since billionaires have most of their money invested, income and wealth inequality matter much less than the news try to make them seem.
According to this article, though, there has been an increase of consumption inequality from 1980 to 2005 in the US according to various papers: https://web.stanford.edu/~pista/JEP.pdf. But the consumption inequality is far less outrageous than income inequality and can be estimated to have been in decline in the world at large through data from the World Bank's DataBank.
The main problem is in political representation. In a democracy, everyone should count as one vote. The natural desire of the population is to have better education and health care, for example, that can lift the standing of the whole society. When a small minority has a disproportionate amount of wealth, they can relatively easily bend politics to their personal wishes. In the US this presents itself in politicians who vote for their wealthy donors to receive tax breaks, the rise of chartered schools, and the fight against public health care.
The measure to look at is consumption inequality, not wealth inequality. It has also increased (though it is harder to measure than income inequality, but see https://www.nber.org/papers/w17982.pdf), but the progressive global wealth tax of up to 2% advocated by Piketty in Capital in the Twenty-First Century could increase consumption inequality instead of diminishing it, and is otherwise less efficient than a tax on consumption.
See “Measuring inequality: A three-headed hydra”[1] in The Economist and “Economics is all about consumption” by Scott Sumner.[2]
Maybe. I don't want this to come off bad, but maybe the work a lot of people do just isn't that important and thus doesn't warrant increases in salary? If a company needs someone to do X, and 5 viable candidates can be found for $Y -- there really is no reason to increase wages.
Anyone with some capital could've invested in Netflix, Facebook or Google several years ago and would have achieved a good return on their money.
Even if some sort of global wealth tax would be introduced (that's a big IF) to fix the accumulation of extreme wealth, would people be better off? The amounts collected, spread out over the entire population, would be relatively small. And most of this new wealth is mostly paper wealth -- the headline next year could very well be: "World's richest lost $3tn of their wealth".
How well does that argument hold up tho'? I mean, there is always _someone_ who does it cheaper. Always. In fact I know of a web developer, who actually does quite decent work and is available for as little as $5 per hour. Does that mean everyone in that skill level should get paid so little?
How would you allocate work? Suppose you are paying a “fair” wage above the market wage, so you have 5 equally qualified candidates apply. They are not allowed to compete on price since you already decided to pay what you consider a fair wage.
I would hire whoever produces the best quality of work for that amount of money, but if they all produce the exact same quality of work, I would hire the one who takes the least amount of money.
The reason anyone can make this kind of wage work is through consumer credit. Eliminate consumer credit, and wages will go up/prices will go down, I would bet my life on it.
Cheaper yes, but perhaps not better. I'd be happy to demand a few million a year for high quality development work from an employer, but the laws of supply and demand do apply.
People who do not contribute to society are what we call parasites. Just because your father or grand-grand-father did something useful to the world doesn't justify that you have to live like a king. Modern society destroyed the old feudal order exactly to avoid this kind of social injustice.
You don't even need to get all this righteous anger involved; the rich benefit more from the stable functioning of society than the poor precisely because they are rich. If the structures that support that wealth were to collapse they'd have a lot more to lose than the guy drowning in debt. It's not only reasonable to expect them to invest more proportionally in the continued functioning of society: it's in their best interest if they're smart enough to look past their balance sheet at the end of the year.
That's a clearly defective model from a game theoretical point of view. A certain rich person can do very little to preserve the stability of the society, so their actions would be concentrated on things that give them direct benefits, that may or may not help society. It's essentially an externality problem, everybody is marginally hurt by say pollution, but some have local gains that far outweigh the costs, motivating them to pollute, bribe politicians and regulators, skirt taxes and so on, leaving other rich or poor people to support the welfare of the society. When the scales tip in favor of the freeriders, you have a failed state that no rich profiteer could have prevented, working individually.
Working individually, yes. But realistically this is more of an iterative prisoner's dilemma than a straight prisoner's dilemma. If the rich don't hold up their part of the social contract, the poor tend to eat them (eventually). So the rich are only incentivized to screw the system if they can get away with it. The problems start happening when we let them get away with it.
Who says they're smart enough? There's a very long history of aristocracies perfectly content to exploit the lower classes, and then got all shocked when the peons wanted the wealthy executed - assuming of course the aristocrats hadn't first riled up the ignorant masses with some reason to start a war.
They only invest in those things that prop them up. Like donating to police or lawmakers, or the very poor with next to nothing to lose (and thus the most dangerous).
I completely agree that the richest should contribute to society, especially as someone in the middle class. However, let's pretend I was born into the wealthiest class. If I inherit a business, that business provides jobs (ie. wages) for people, and is a functioning part of the economic system. Does that mean I am not contributing?
Regardless of how rich I am, I still need to eat and live and put clothes on my back. Are these not contributions?
Or are you suggesting that the wealthiest are parasites simply because they should contribute more to society than someone less financially well off?
> I'd say the higher in the social rank, they ratio of contribution to taking drops exponentially, not linearly.
You mean the richer people are, the ratio of their contribution to taking grows? That does not seem possible, because that will not make the person rich in the first place.
Avoiding taxes isn't illegal though. So in a global economy I'm not sure your argument is technically justified and simply the righteous argument most people would accept as true.
If my US company shifts labor to India, do we assume it is bad simply because the US doesn't receive those wages to stimulate the US economy? Does this benefit India though?
I think your argument depends on perspective, from US point of view this situation is bad, from India's it isn't bad. From the wealthy person's doing this, it simply benefits him/her.
I don't know how to solve this and completely agree with the argument but it is technically flawed.
> why should an extremely wealthy person have to contribute to society?
If influence, specifically political influence, and wealth could be perfectly decoupled, no reason. That nexus, however, means an oligarchical class of rich idiots have the capability to project their stupidity onto national policy.
Even if they aren't projecting their stupidity, they're certainly projecting their interests. There's nothing preventing their interests from being at odds with society's interests.
Poor idiots collectively have the capability to project their stupidity onto national policy as well. Maybe we should reduce the size and scope of national policy to minimize the impact of idiots, rich or poor.
If a wealthy person earns their wealth, then they have benefitted from their contribution to society. If they are allowed to lock that wealth up multigenerationally, then they are incentivized to change the system to make it harder for others to do what they themselves have done, to the benefit of others who have also already taken advantage.
Society as a whole benefits much more when each generation has to earn the bulk of their wealth.
At minimum, a wealthy person should at least buy stuff -- that would actually be a contribution to society. But the super-wealthy have more money than they can possibly spend!
You have offered no evidence for any of your assertions for the ill effects.
When Elon Musk becomes obscenely wealthy by creating affordable electric cars and space flight, everyone else gets the benefits of affordable electric cars and space flight. Not talking trips to mars, but constellations of satellites offering super cheap worldwide internet.
Wages have stagnated and the poor are not seeing an equivalent increase in their wealth. Moreover, while the jobs numbers are very high 94% of all jobs added in the last decade have been temp/contract work/self-employment.
We set up an incentive scheme to vigorously punish employers for offering full time work by loading it down with obligations over the worker’s long term well being, and didn’t do anything similar for temp/contract work. What were you expecting?
If we attached proportional responsibility to part time work, or just provided benefits out of the public purse instead of labor law, part time work wouldn’t be such an obviously superior choice to employers.
And humanity, as a whole, will probably reap a ton of long term benefits from it. I doubt there's much solace in this thought for someone being fired because of it, though.
(Personally I don't mind a bit of hardship if it helps everyone, but I understand not everyone can be frugal or that some people can be just plain unlucky)
That claim is not only unsupported, it's almost certainly false. The last few decades haven't been great for the middle class in wealthy countries, but it's been fantastic for "poorer people across the world." U.S. GDP per capita is up 60% since 2000. Bangladesh's is up 235%. India is up 288%. Thailand is up 195%. Poorer countries that have been able to cobble together enough rule of law to participate in capitalism have benefited tremendously from it.
To be exact, it seems to be saying that the richest 500 are x% richer at the end of the year, not that the 500 richest at the beginning of the year are %x richer at the end of it. These are two different things because they are two different sets of people.
In decades past the richest and the poorest people don't remain in that part of the income distribution very long; this is especially true in the US.
> These are two different things because they are two different sets of people.
The sets mostly overlap. The top 10 of the richest people was the same in 2016 and 2017 [1]. These 10 people saw their net worth increase by $107 billion.
> In decades past the richest and the poorest people don't remain in that part of the income distribution very long; this is especially true in the US.
I would say this is especially not true in the US where social mobility is notoriously bad.
"Several large studies of mobility in developed countries in recent years have found the US among the lowest in mobility." [1]
From 2001 to 2007 (just 6 years), the proportion of US households that left their income quintile were (starting at the lowest quintile) 44%, 61%, 58%, 55%, and 34%. Even by global standards that's quite high income mobility.
Those changes are about the same for any window of the same time length for all of recent US history. St. Louis FRED has data and papers on this.
One of the best studies on intergenerational mobility in the US, using all IRS records (not sure how hard they had to work to get those) shows that mobility in the US has been fairly constant for 50+ years.
While a technically valid criticism, is it really that controversial? Costs are increasing faster than wages at low income levels - which is easy when wages are largely stagnant or declining due to increased competition driven by labor surplus and automation.
It's not even controversial, it's wrong. Poverty, particularly extreme poverty, has been decreasing rapidly over the past 25 years.
Of course, this doesn't mean that everyone is better; there are always winners and some losers, and there are setbacks here and there, but the big picture is one of great progress.
For more, one should read the Human Development Reports:
Actually, about 1 percent of children in the United States suffer from chronic malnutrition. And malnutrition occurs in people who are either undernourished or overnourished. In the United States, more children suffer from malnutrition due to dietary imbalances than due to nutritional deficiencies.
Poverty also includes having your neighborhood torn apart by junkies on opioids.
But I guess actually looking at the econometric data to compare apples to apples isn't worthwhile because you can stay indoors while your tires are stolen and watch Jessica Jones, so things are better than they used to be, right?
Since the parent was commenting a quote about "billions of poorer people across the world have seen their wealth standstill or decline", it is rather obvious that the Guardian was commenting not on US poverty but global poverty.
Nearly a billion people have been pulled out of poverty in India and China over the last 25 years. Their wages have at least tripled on average in real terms in the last 20 years. So, it's you who's burying your head in the "America first" sand.
The middle class in the US had enjoyed the fruits of global inequality resulting from colonialism and WW2 during the second half of the 20th century.
As the gap in skills and education between the average American and the rest of the world have disappeared, the former US middle class will see their income gap with the rest of the world also disappear. A teacher, factory worker or a store clerk in the US isn't 20x more productive than a teacher, factory worker or a store clerk in India or China and there's not reason for that wage gap to exist any more.
I am not entirely sure if you are trolling. People being brought out of destitution is progress, absolutely.
It's the very first and most important step of progress. If people don't have enough to eat, even their brain won't develop properly. The lower layers of Maslow hierarchy are absolutely essential.
After that, more progress is needed, but having food, essential health and physical security is definitely the fundamental thing for any other types of progress, such as education.
Is it possible for everyone’s wealth to increase? I think they might be assuming this is not possible and there if richest wealth increases by this much it had to come from the rest?
So the people with the smallest piece of the pie are slowly getting a larger piece, but the people who already have the biggest piece of pie are getting even bigger pieces faster. But because the pie is growing, it doesn't mean that their larger piece is making someone else get a smaller piece.
The only people who have a proportionally smaller piece than they used to are in the middle class. Which is what happens when first world work more closely with developing nations. Taking more people out of extreme poverty but putting slight downward pressure on the middle class.
> The number of people living in extreme poverty has fallen DRASTICALLY over the last 25 years.
This is defined as people living on less than a dollar a day. Yes, it has more than halved in 30 years. Congratulations. I totally see how this progress actually over half a century relates to the world's richest getting an extra trillion in one year. Yep, makes sense to me.
The "dollar" has been adjusted over time, though, and is currently actually USD 1.90.
Your tone sounds sarcastic but I don't see the justification for it. The number of people who are actually hungry and malnourished has gone down significantly, and far more people are vaccinated today then 25 years ago, and far more children can go to school and literacy rates are up.
Sorry to hijack this, but referring to your other comment, I also saw weird stuff going on today with posts getting flagged. Seems the bots and trolls have found our corner of the internet as well... Not sure what's going on exactly.
Even if it did increase, most of that increase is just inflation anyway. And it's usually the wealthy that benefit from inflation (at least more than regular people do).
Compare the "regular" person of today to the "regular" person of 50 years ago.
Is it easier or harder to afford basic foodstuffs?
Do they eat out (luxury) more or less?
If they own a home, is it larger or the same size?
Who travels more?
Who has better healthcare?
Who spends more on entertainment?
How much do they spend on the family pet?
Who spent more time furthering their education?
All of these are measures of wealth, and the modern "regular" person would be wealthier in every one of these categories. And that's not even factoring in advances in technology that make the quality of life of a person better even if there share of societal wealth goes down.
This is very shortsighted-claiming that all of these trends have to do with being richer, is simply absurd. Also, "regular" person? What age? Male? Female? What does that even mean? This is just utter nonsense. But I will humor you:
> Is it easier or harder to afford basic foodstuffs?
Processed foods are far easier to afford, but they are extremely unhealthy. As for other basics, many have gone up over the last 50 years.
> Do they eat out (luxury) more or less?
Women now work. 50 years ago they did not. Less time/people to cook at home. Not like everyone is eating at steakhouses. They just don't have the time so they go to Chipotle or McDonalds or Panera.
> If they own a home, is it larger or the same size?
Most people own legacy homes-they are the same size because they are the same homes. New builds are building bigger houses but what "regular" person builds new homes?
> Who has better healthcare?
This has more to do with advancements in medicine and technology than people becoming richer.
> Who spends more on entertainment? How much do they spend on the family pet? Who spent more time furthering their education?
Furthering education is largely on credit, so this is a bad measure.
> and the modern "regular" person would be wealthier in every one of these categories.
> This has more to do with advancements in medicine and technology than people becoming richer.
It's impossible to separate people becoming richer from advancements in technology. We didn't grow GDP by 77 times, because we work 77 times harder.
Improvements in underlying technology are what help us create more wealth. The problem is that the new wealth being created and benefits of that new technology is being shared so proportionally.
Fifty years ago, my grandparents built a 3 bedroom, 2 bath house on 4 acres of land with cash saved up from my grandfather's manual labor job (he stopped going to school in 8th grade) working for a sugar cane plant. They never, in the entirety of their lives, took out a loan. The simple fact of the matter is that they saved and invested back when it was easy to save and invest and thus never needed to rely on a bank for anything other than a place to store money. Oh, and they sent their 5 kids to college.
Try to do that today in the same area. The foremen at the same sugar house could never afford a regular residential lot, much less the a house to put on it. It would take them 20+ years to save the money.
> it's usually the wealthy that benefit from inflation
Inflation is a regressive feature of modern currencies. It transfers wealth from lenders to borrowers and away from investors. The degree to which it does so is a function of the amount of wealth one has.
The wealthy absolutely do not benefit from inflation, and lose the most money due to it in reality. Inflation depreciates the value of your liquidity, which is why every major company (except apple, it seems) dumps as much currency as possible into appreciable and tax deductible assets. However, that's more difficult for persons, and most of the super wealthy end up holding a plurality of their money on their person. Part of the reason for this is that they have enough money that they can't easily enter the market with a sizable amount of their total funds without moving the market against themselves.
> Inflation depreciates the value of your liquidity, which is why every major company (except apple, it seems) dumps as much currency as possible into appreciable and tax deductible assets.
When you read stories that Apple (or whoever) has $X billion "in cash" it's not actual cash. They keep some around in money markets and the like for near term expenses, but the majority is in bonds that pay more than inflation. In fact, if Apple were classified as a bond fund they would be the largest in the world:
That makes sense. Morningstar groups all near term liquidity together, and so I figured Apple had to be constantly expanding aggressively or something and needed a warchest 7x the size of microsoft's to do it. Sitting on bonds as amid-near term solution makes more sense.
Yes, they absolutely do. Without inflation, it would be almost impossible to borrow money from a bank. No borrowing = no new investment. Most super-wealthy people are constantly borrowing money because the rates they borrow at are lower than their return on investing that money.
Yes, it is definitely possible and expected. Your line of reasoning is a pretty common one and is sometimes referred to as the "zero-sum fallacy" or "fixed pie fallacy"[0].
As many other commenters have pointed out, it is possible for net global wealth to increase (e.g., the increase in total real GDP). As far as I understand, the main reason this is possible is the development of new "technology" -- in the very general, economic sense of the word technology [0], which includes anything that increases the productivity of a single worker; this can include everything from new technology in the traditional sense to new processes (e.g., agile vs. waterfall for software development, or more optimal supply chains) and investment in infrastructure (e.g., better road networks).
For example, a single farmer today can not only produce many times more crop compared to a farmer 100 years ago, but also safely and efficiently distribute this produce to consumers across the globe. In general, assuming everyone in the economy works equally hard, the total production (i.e., the global net wealth) can increase as long as technology is increasing.
Rich people tend to have most of their worth in stock. In theory, assuming your stock got more expensive, you get richer without anyone in particular getting poorer.
Or. everyone with debt - which is usually a very large portion of the population - had their burden reduced.
edit: Ability to pay grows with inflation, by definition. Unless you have a particularly unusual type of debt, the principle is constant and the interest is based on the remaining principle and is therefor a pre-inflation value. Wages grow in absolute terms (even though their purchasing power is otherwise constant), so the debt is easier to pay off.
The theory is naive, dismissive, and wrong. Stock value increases are coming from optimizations within companies that reduce employee benefits and compensation. On the consumer side of things, profits also come from taking advantage of deregulation, lowering the quality and safety of consumer products and services. Executive leadership and investors are pocketing gains made from making everyone else's lives worse.
Getting richer has a strong relationship with making others poorer.
Are you saying stock value increases only come from reducing employee benefits and compensation or from lowering the quality and safety of products and services? Seems like that is simply not true across the board. If a company sells say software they could easily grow revenue and profits without changing their product or reducing employee benefits and compensation. Their earnings would be higher and their stock would go up.
How much of this opinion is coming from being involved in the management of companies vs news articles tuned to generate outrage so that they can generate clicks?
I'm serious. Do you have first hand knowledge of what you speak, or are you just looking for someone to be angry at?
Also, looking at your comment history, you've literally only ever commented on the misery of the proletariat and related topics, which makes me suspect this is an astroturfing account.
> Getting richer has a strong relationship with making others poorer.
This theory is naive, dismissive, and wrong. You have accurately seen some bad examples, and it has led you to incorrectly conclude that the bad examples are the bulk of what is going on.
The central idea of capitalism is the extraction of surplus value via property relations and wage labor.
Voluntary exchange is not capitalism. Voluntary exchange has existed since the dawn of society. Capitalism is a form of production that developed with the industrial revolution. I can't tell if you've fallen for or are employing a sleazy equivocation.
To assert the existence of surplus value, one must also declare the baseline. For Marxists, the baseline is the “labor-value.”
That the labor theory of value is entirely bunk is trivial to see. If you present to a buyer two indistinguishable instances of the same good but describe how one was meticulously hand-crafted by skilled artisans and the other produced by machines in a factory, in the prospective buyer’s view the former is no more valuable than the latter. Value is imputed by the end consumer who is willing to pay only so much for a pair of shoes, a hat, a computer, a book, an automobile, a house, whatever. Marxists object that this is “commodity-fetishism,” but their many syllables fail to camouflage their deep confusion.
Even employers — rather than exploitative expropriators — are sellers of goods or services but buyers of labor, one of many factors of production. Consumers set prices with their willingness to buy. Producers seek to meet this demand at a profit. (Running a break-even operation is a bad model: at best you end up back where you started and otherwise book red ink.) To take profit, they must produce at a cost below what the consumer will pay, the prevailing price. Raw materials must be bought ahead of time. Employees expect regular paychecks. The employer must risk all of these costs by paying up front for a chance of turning a profit in the end.
Employees likewise are sellers of labor, a role that Marxists fail to recognize or else they’d have to slap expropriator labels all around. Employees shop their skills to find the buyer who values them most highly. When a better offer comes along, we usually congratulate the person for finding a better situation even though it is the same worker now supposedly “extracting” more value. The downside is sellers compete against one another. When the value proposition grows too rich, we buyers start shopping elsewhere. “Cheap labor” is nothing nefarious; everyone is looking for a better deal. Sellers of goods, services, and labor must all continue to improve their offerings.
From top to bottom, this is a network built on voluntary exchange with no extraction or exploitation. The ruthless player is the fickle consumer whose tastes, demands, foibles, and sense of urgently are always changing. There’s also Mother Nature, sometimes gentle and sometimes furious. We live in a world of scarcity with the future uncertain. Where will tomorrow’s dinner come from? How will parents pay for their kids’ college years down the road? How will I pay the light bill next month? Capitalism’s aforementioned complex network of voluntary exchanges — “the market,” for short — is a search process for how best to allocate what we have now in order to obtain what we need and want tomorrow.
Yours is a very shallow reading of Marx. A common, but nonetheless shallow reading. The only thing I can really do is refer [0], sections 5 and 6 starting on page 35 as an answer to such an interpretation.
> From top to bottom, this is a network built on voluntary exchange with no extraction or exploitation.
I mean, this is just preposterous. Are we going to ignore how capitalism developed with enclosure, forcible transformation of the commons into private property, and colonialism? Do you really want to make the claim that, say the Dutch East India Company's involvement in India was based on voluntary exchange with no extraction or exploitation? Or how about today, when the computers we use to write these messages rely on conflict minerals? Give me a break. Your analysis is ridiculous at face value. My only question is how you could type that out with a straight face.
No, the central idea of capitalism is the re-investment of the surplus produced, rather than consumption of the surplus, no matter where the surplus came from. The surplus can come from one's own labor, or from a sole proprietorship.
I can tell that you've fallen for Marxist rhetoric.
I've always found this idea that capitalism was "invented" to be so strange.
e.g. When an ancient king had land, and let poor people work the land in exchange for a part of their production, what would you call that? Sure sounds like, "the extraction of surplus value via property relations and wage labor" to me.
Same story if the lord has a mill and charges people to use it. Or a bridge and charges people to cross it. Technology was worse, so there weren't as many physical forms of capital, but it definitely existed.
Some people seem to have this need to see capitalism as this invention created by bad people. Because to admit now natural and organic it is would be to admit how much enforcement and violence their ideology really demands in order to obtain the real world.
I didn't use the word invention, I used the word development. There was no connotation about naturalness in what I said. Neither did I make a moral judgment on the development of private property. So, why are you imposing on my words an argument that I wasn't making?
> e.g. When an ancient king had land, and let poor people work the land in exchange for a part of their production, what would you call that? Sure sounds like, "the extraction of surplus value via property relations and wage labor" to me.
Ok, if you want me to be more precise, private property relations, which are very different from feudal property relations. In fact, since property is a legal construct, this aspect of the development of capitalism could be called an invention, and the idea that capitalist forms of property are particularly ""natural and organic"" compared to other forms is quite suspect-- at least without any argument provided for it. As a foot note, one of the processes that developed private property was Enclosure [0] which was by no means nonviolent.
But I'm not going to try to be as precise and rigorous as a history textbook in Internet comments I compose in between compiles. Feel free to believe that capitalism is natural and organic, or read a history book. Idk.
> When an ancient king had land, and let poor people work the land in exchange for a part of their production, what would you call that? Sure sounds like, "the extraction of surplus value via property relations and wage labor" to me.
There is an extent to which it is true (well, the first part, not wage labor!), but it's a different set of property realtions than the ones which are the defining feature of capitalism.
> Same story if the lord has a mill and charges people to use it. Or a bridge and charges people to cross it. Technology was worse, so there weren't as many physical forms of capital, but it definitely existed.
Feudalism is also a system by which value is extracted by property relationships; a different set than capitalism, and (while some quantity of wage labor may exist within feudalism) not one where wage labor plays a central role.
Capitalism replaced the system of property relations underlying feudalism with a different set.
> Some people seem to have this need to see capitalism as this invention created by bad people.
Traditionally, that's not even how the socialist critics that first identified it viewed it; it wasn't “an invention created by bad people”, but the state resulting from a number of related changes to the model of property driven by a combination of opportunity created by physical and other social technologies and self-interested people seeking their own gain. (This isn't inherently bad, the same people saw socialism the same way, though they saw the class driving and benefiting the preservation of capitalism against further change as narrow and inherently narrowing with the continuance of capitalism.)
I'm not really sure, then, what people you are referring to, since neither capitalism's defenders nor it's main critics hold the view you are attacking.
If it is asymmetric, the superficially apparent mutual gain may be illusory, because—while many people think for moral or aesthetic reasons that this should not be the case—there is enormous empirical evidence that the actual experience of utility related to material position is very strongly driven by relative material position, which is often far more significant than absolute material position.
But is that empirical evidence talking about peoples' overall position, or their position with respect to one particular exchange?
That is, it can be true that I feel rich or poor by comparing myself to others, not based on my absolute wealth. It can also be true that I look at any individual transaction and decide whether to make it or not based on whether it makes me better off in absolute terms.
> But is that empirical evidence talking about peoples' overall position, or their position with respect to one particular exchange?
It's about overall position, but the outcome of every particular exchange is a change to overall position; now, if the asymmetry in exchanges were essentially random, this wouldn't matter, but when you have a system with distinguishable classes, and there is a clear relationship between class role and which side of the asymmetry of exchange you tend to fall on across exchanges—say “capital” having the greater gain and “labor” the lesser—then you can end up with a situation where the pattern of exchange, each seemingly mutually beneficial but asymmetrically so, ends up producing more disutility from increasing inequality on one side than utility from absolute gain.
> So you're saying that it would be better if everyone was poorer individually, as long as they were more equally poor?
No, it's not at all that simple; there's both disutility associated with inequality and utility associated with absolute material position; how those net out is more complex than either “everyone getting more is better regardless of distribution” or “more equality is better regardless of how much per everyone gets”.
>So you're saying that it would be better if everyone was poorer individually, as long as they were more equally poor?
Why are you creating this either/or? Are you proposing that if we don't allow people like Gates and the Kochs to hoard billions of dollars that everyone will be poorer individually?
In real terms this could happen if productivity increased, and was able to lead to increased standard of living for everyone. This probably did happen for some large subset of the population, by some definition of "standard of living."
It's a pretty well understood and accepted fact at this point. It's been a major talking point in economic and political circles for the past 5 - 10 years.
The sources below are from a quick Google search. They mostly reference income stagnation and are about the US. But income stagnation leads to wealth stagnation and there are similar trends world wide. Thomas Picketty's Capital in the 21st Century is largely about this issue, as is Robert Reich's documentary Inequality for All. There are those who challenge the conclusions drawn in both, but few seriously contest the data they point to.
You don't need any data to support that fact, any regular person can see for themselves that this is true just by looking at their own situation and that of their family members, friends, neighbors and acquaintances.
