
Richest 1% on target to own two-thirds of all wealth by 2030 - eplanit
https://www.theguardian.com/business/2018/apr/07/global-inequality-tipping-point-2030
======
cal5k
Steven Pinker's new book, Enlightenment Now, has a pretty compelling section
on wealth/income inequality. The basic position - and I think the data
supports this - is that it really doesn't matter what the top 1% are doing so
long as the bottom half are seeing improved living conditions.

Furthermore, wealth isn't a static I win/you lose proposition - much of that
wealth has been created in recent history. People spend less as a percentage
of income on food and housing, have better access to healthcare, and more
leisure time than ever before. It's a remarkable story.

Over a billion people have been lifted out of poverty over the last 30 years
thanks to globalization. I think that's much more important than how much
money Warren Buffett or Bill Gates have.

Income/wealth inequality has been the state of humanity for all of recorded
history, and it seems unlikely to go away any time soon - it's trivially easy
to show how wealth accumulation occurs using game theory even if trade is
relatively fair. The only events that seem to reliably reset the balance are
global wars, huge famines, or natural disasters.

I think it's a natural human inclination to fixate on the rich and to demonize
them, and perhaps some are deserving of such demonization, but it doesn't seem
to be a terribly useful way to think about improving the human condition. It
just spurs on class resentment which is, if history is any guide, just about
the worst way to go about things possible.

~~~
psyc
It couldn't possibly not matter, because wealth is not only standard of
living, but also power. At the highest level, the wealthy are not simply
comfortable. They have the power to shape and organize aspects of the economy,
supply chain, and the laws. That has to matter in some way beyond having one's
material needs met or not.

~~~
defertoreptar
That's a good argument, and to many it's an argument for wealth
redistribution. I prefer to look at it instead as an argument for limiting the
powers of government in order to limit its susceptibility to corruption.

~~~
audunw
A small and limited government is a weak government. A weak government is
susceptible to corruption.

To avoid corruption you need the state and the collection of the most powerful
corporate/private actors be of similar size, and they must be as isolated and
independent as possible. This way you get a balance of power, rather than one
corrupting the other.

The problem in the US is the isolation/independence part. Money in politics
and revolving doors has corrupted the balance.

“Limited government” is an idea sold by people who want government to be
weaker so it’s more easily corrupted.

What we should strive for is the middle way. Just the right amount of
government.

~~~
gwright
> A small and limited government is a weak government. A weak government is
> susceptible to corruption.

Your assertion isn't self evident. A government could have great power within
its defined scope of power and little power outside that scope.

There is also a reasonable argument that as the scope and strength of
government power increases so does the desire to corrupt and control that
power.

Which is more dangerous a corrupt but weak and limited government or a corrupt
strong and expansive government?

------
Animats
Communism went away. It's not that communism was better. It's that it was
competition. There was, for half a century, a competitive threat - do better
than the USSR, or face a revolution. That threat was taken quite seriously in
the US for decades. Industrialists (the US economy was mostly manufacturing
back then) were careful not to get too greedy or power-hungry.

They feared expropriation. Britain nationalized many industries. Most telcos
were run by governments. Monopolies were routinely targeted by democratic
governments.

Capitalism now has a monopoly position and acts like it.

~~~
dmitriy_ko
Capitalism is so ingrained now, nobody can even imagine that alternative
system could exist. In the minds of most, communism is a synonym of
authoritarianism. Communist governments tended to be authoritarian, but it's
not clear to me if it's a natural consequence of communism. It's more likely
that authoritarianism is a consequence of violent revolutions. Is it possible
to combine communism with democracy?

~~~
dogma1138
There is no way for a communist government to be non-authoritarian communism
can’t work in any other way.

Planned economy and lack of personal liberties cannot coexist in what we would
call a democracy unless your definition of democracy is a slightly less
violent conflict resolution method.

Overall democracy works because it respects the wishes of the individual
essentially it gives everyone the right to express their wants communism has
no room for any form of individualism.

~~~
KozmoNau7
That's not communism, though. Communism requires the withering of the state,
so a communistic government is a contradiction of terms.

~~~
dogma1138
Now we're back to the "no true scotsman" argument, a communist government is
not a contradiction unless you go by the most extreme anarchist
interpretations of communist doctrine.

But sure show me how you transition from the "dictatorship of the proletariat"
phase to this stateless paradise and I'll concede my argument.

~~~
KozmoNau7
Read Marx, then come back.

~~~
dogma1138
I had, so again please tell me how we switch to communism without the
dictatorship of the proletariat or any mechanism through which we can evolve
through it and I’ll concede my argument.

By Marks himself the dictatorship is a critical phase in the process.

~~~
KozmoNau7
That's a twisting of terms, in the correct context, it's a temporary switch
from a dictatorship of the bourgeoisie over the proletariat, to the opposite.
The term dicatorship is only used because it retains the state, as it will not
yet have withered away. Thus it does not meet the definition of communism.

But it is not the same as the common defition of a dicatorship, with
oppression and selfish tyranny, which seems to be the association you want to
make.

I loathe linking to Wikipedia, but the page in question does sum it up quite
well:
[https://en.m.wikipedia.org/wiki/Dictatorship_of_the_proletar...](https://en.m.wikipedia.org/wiki/Dictatorship_of_the_proletariat)

~~~
dogma1138
Again in practice how do we switch from A) to B), the truth is that you can’t
and you won’t since any dictatorship will naturally always elect to preserve
it’s power.

The stateless version of your so called communism is essentially pure
libertarianism the problem is that both are just as impossible and unlike the
latter the former cannot coexist with the free market of ideas which is the
natural state of a nationless/stateless society.

~~~
KozmoNau7
>"the truth is that you can’t"

Only defeatist quitters speak in such absolutes.

Again, it is not a dictatorship in the commonly understood terminology, but
rather a term that is used for a political system where one part has political
power over the other under the existence of a state, because we don't really
have a proper and precise term for it.

~~~
dogma1138
How do you call a system of government that by definition does not operate in
a free market of ideas, respects individual freedom and property rights and
consists of a monolithic political ideology?

>"Only defeatist quitters speak in such absolutes."

Can you have a system that does not conserve energy? No, there such things as
absolutes.

Communism besides being the mother of all bad ideas and the most vile ideology
humanity has created is also deeply internally flawed and essentially ensures
that it's final outcome can never be reached.

And even if we take that final outcome as our starting point it has no
mechanism to sustain itself once there is no government and now laws that
dictate social behaviour anyone can do whatever they want and no one can stop
them.

So if at T+0 we have the withering of the state and perfect communism at T+1
nothing would stop me from taking control over whatever resource I want and
saying well fuck you now you gotta pay.

~~~
KozmoNau7
Ah ok, you've obviously bought in 100% to US-style anti-socialism propaganda.
I refuse to argue with fanatic True Believers.

~~~
dogma1138
I have no problems with social democracies I live in one, we’re talking about
communism.

------
throwaway84742
Worldwide, if you make over $32k per year you’re 1%. I suggest folks think
carefully about this fact before suggesting hanging the rich or anything else
Marxist-Leninist.

[https://www.investopedia.com/articles/personal-
finance/05061...](https://www.investopedia.com/articles/personal-
finance/050615/are-you-top-one-percent-world.asp)

~~~
collyw
Top 1% of earning, not necessarily top 1% of wealth.

I remember checking my moderately above average European income on a site that
showed this. I think I was in or close to the top 1% of earners. But not being
on the property ladder I think I was closer to top 6% by wealth. (It was a
while ago so my numbers may be a bit out, but I hope you get the idea).

~~~
throwaway84742
>> Top 1% of earning, not necessarily top 1% of wealth.

When it comes to hanging the rich nobody cares about such details.

~~~
collyw
On a moderate but above average salary in Spain. If I get some inheritance
when my parents die and have my own apartment paid off, then I could be in the
top 1% in 20 years time. I am by no means rich by western standards, just a
bit above average. Do you suggest we hang all pensioners who have paid of
their properties and earned a reasonable wage throughout their lives in
Western Europe?

Jordan Peterson seems correct for a certain percentage of people when he says
'Middle Class Socialists don't like the poor but they hate the rich'. Your
comment comes across as backing that up.

~~~
throwaway84742
I suggest not hanging anybody. You have reading comprehension issues.

------
AtomicOrbital
Any student of history is well aware of these cycles of ever increasing
concentrations of power and wealth followed by violent grassroots overthrow of
1% types where control and wealth returns to a more productive distribution
... rinse & repeat ... for example look at Italy from the years 1000 to 1400
which experienced several such cycles ... its a natural expression of the will
to power ... the real crime to humanity happens when poor children are starved
of education and opportunities while 1% blithely hordes resources in blind
faith that more is better when in-fact everyone is better off when the people
at the bottom are maximally lifted into self actualized individuals knowing
they have skin in the game ... anything less than this is wasting human
potential on a massive scale

------
drawkbox
USA wants to be #1 at the GINI index and coefficient, we are challenging
Brazil, Mexico, Turkey, Chile, African countries and more for the top spot!
USA! USA! [1]

[1]
[https://en.wikipedia.org/wiki/List_of_countries_by_income_eq...](https://en.wikipedia.org/wiki/List_of_countries_by_income_equality)

~~~
tonyedgecombe
I wonder if the pendulum will eventually swing the other way.

------
austenallred
I wonder what percentage of Hacker News readers are in the international 1%.
That’s about $32,000/yr salary. My guess is it’s much greater than 50%.

~~~
collyw
We should clarify if we are talking about top 1% of earnings, or top 1% of
wealth. The housing boom in the UK in the last 15 years has made wealth very
related to age.

~~~
jpollock
1% of wealth is USD770k in net assets.

However, don't forget to include any defined benefit pension (state provided
or otherwise) to the list of assets.

A pension paying USD$30k/yr (20yr length, 4% growth) costs USD$425k[1]. Add on
an employer provided defined benefit pension (e.g.police, fire, military,
federal employee), that can be worth a lot of money.

[1] [https://www.bankrate.com/calculators/investing/annuity-
calcu...](https://www.bankrate.com/calculators/investing/annuity-
calculator.aspx)

~~~
austenallred
Net assets is greatly skewed toward later ages, for obvious reasons.

What percentage of HN will be in the international 1% in assets by the time
they die? I’d still guess more than half.

------
danschumann
Top 1% of composers are most of all classical music played ( probably over
two-thirds ). Of their music, maybe 1% of their songs are the ones that get
most of that playing.

Celestial bodies also have exponential inequality. Get a little mass, get more
gravity, get more mass. Inequality is within nature itself.

Actors in hollywood. They release one movie, now they get 50 offers for other
movies. They quickly get more than 2/3 of the opportunities, relative to an
unknown. Inequality will always exist because trust exists, and if you trust
someone, you will want to work with them.

Capitalism is great, because even if you're an unknown, you can do a good
job(at whatever field you want), and get more opportunities, and do more good
jobs, and get exponentially more opportunities.

~~~
haskellandchill
Capitalism isn’t very good at the initial bootstrap, start from zero and you
have to take stop gap jobs that exhaust you while long term having a chance to
build skills for a future job could have far better outcomes for everyone
economically.

------
CryoLogic
Top 1% worldwide is not a great statistic. In many US cities that is just
above poverty due to CoL at ~32k.

~~~
inerte
Is there a better one instead? Or is it useless to measure global inequality
and weatlh accumulation? Is there a local/national/global threshold that would
make you concerned?

~~~
Axsuul
There should also be 0.5 and 0.9 quantiles since just knowing the 0.99 doesn't
really say too much about the overall distribution.

------
collyw
Someone else on HN commented that the poor need to stop reproducing in order
to improve equality. At first I found the comment kind of troubling, but the
more I think about it the more it _seems_ to make sense.

Watching this video kind of backs up the point to a degree, even though the
topic is immigration.

[https://www.youtube.com/watch?v=LPjzfGChGlE](https://www.youtube.com/watch?v=LPjzfGChGlE)

Can someone come back with a decent counterargument? I haven't been able to
yet.

(It's worth remembering that a good percentage of people reading this will be
in the top 1% despite not being "rich" by western standards).

~~~
curun1r
His argument is akin to arguing that the Soviets lost WWII because they lost
so many more soldiers than the Germans. But that's not what happened. The
Germans might have had a higher score, but the Red Army still pushed them all
the way back to Berlin and Hitler died in a bunker. Success is measured in
achievements, not by lack of failure.

For the poor to stop breeding would be ceding their one and only competitive
advantage. Humans, and for that matter, life on Earth in general, aren't
"judged" (in the sense that extinction/flourishing is a judgment) based on how
many failed organisms they produce. Rather, that determination is based on how
many successful organisms are produced.

As residents of richer countries, we're conditioned to breed at or around the
replacement level and to view each failure as a catastrophe. So when we see
those 80 gum balls being added each year to his misery containers, we're
viewing it through the lens of seeing the failure. But in poorer countries,
people adapt to the increased chance of failure by having more kids. They
breed well above the replacement level knowing that, in all likelihood, not
all of those kids will succeed. From that perspective, you need to focus on
that 1 or 2 gum balls being allowed into the richer countries. That's the
success. And having fewer kids runs contrary to that goal.

~~~
iguy
_conditioned to breed at or around the replacement level_

The concept to read up on here is r/K selection. Life is certainly judged by
how many offspring, but there are various strategies for producing them, and
one of the trade-offs is number vs. investment in each. Among all animals
humans are far at the r-strategy end (high parental investment).

But different societies choose slightly different points, probably related to
their history of farming. And the richer countries today are those
traditionally towards the r-strategy end.

------
mooneater
It is said the Chinese plan out 100 and 1000 years.

Why not continue the extrapolation past 2050 and 2100, it might provide sound
bites with more teeth "One person to control 99% of wealth by date 20XX".

~~~
skybrian
This is silly. Chinese history is no more predicable than anywhere else. If
any such plans exist, they are pretty worthless.

~~~
mooneater
"Plans are worthless, but planning is everything"

------
rm999
To put it in perspective: today you are in the global top 1% if you have at
least $744,400 in household assets.

You are in the top 10% if you have at least $71,560; top 50% (median) if you
have at least $2,220. And the mean wealth is $52,819 per adult.

source: [https://www.economist.com/news/business-and-
finance/21710771...](https://www.economist.com/news/business-and-
finance/21710771-new-analysis-how-worlds-wealth-distributed-you-may-be-higher-
up)

------
forrestthewoods
Top 1% Global Income - $32,500/year

Top 1% Global Wealth - $770,000 assets

via [https://www.investopedia.com/articles/personal-
finance/05061...](https://www.investopedia.com/articles/personal-
finance/050615/are-you-top-one-percent-world.asp)

~~~
aquark
This feels like a large disconnect?

Assuming these two sets of people are not the same -- there are a lot of
people in the west earning > $32K a year and having less than $770K in assets.

So they are in the top set but not the bottom. Since the cardinality of the
sets is the same, where are all the people that have more than $770K in assets
but earn less than $32K a year.

Even a fairly modest 5% return would produce more income than that, or are the
stats excluding investment income?

People with that much equity in their home wouldn't realize the income ... but
how many people in the west even live in $700K+ homes and yet have less than
$32K in income a year? Maybe some seniors, but surely not a very large group.

~~~
forrestthewoods
I agree. It does feel weird. I suspect radically differing methodology may be
at play.

Then again if you take a teacher who made $40k/year for 30 years but has a
decent pension and owns a normal home maybe it's possible?

------
qaq
I keep seeing mentions of Bill Gates, Warren Buffett etc. when people talk
about 1%. 1% are lawyers, Doctors, Senior Software Eng. etc. it's over 3 mil.
people in US alone. Billionaires are 0.018% of that 1% and Gates and buffet
are the top 1% of billionaires.

------
smaddox
A more accurate title would be "Richest 1% on target to own two-thirds of all
_capital_ by 2030". Wealth is not equivalent to capital. The vast majority of
capital is tied up in the market capitalization of corporations, and only a
small fraction of the market capitalization corresponds to actual physical
wealth. If tomorrow the global stock market took a 10% dip across the board,
then nearly 10% of the world's capital would vanish in the blink of an eye,
but the worlds material wealth would not change at all.

There's no doubt that there is dramatic capital inequality in the world, but
as long as that capital is being put to productive use (generating and
distributing wealth) all is well. There's also vast wealth inequality (though,
numbers wise, it's not nearly as bad as capital inequality), but as long as
the minimum wealth is not desolation, wealth inequality is not a fundamental
problem. As humans (or just as animals), we will always crave what we do not
have, but if the cost of fixing wealth inequality is transferring capital to
those incapable of applying it productively, thereby lowering the worlds total
wealth, I do not believe we should bear that cost. Rather than focusing on
wealth inequality, we should focus on building solid safety nets and proper
incentives.

~~~
charlesdm
That same 1% would then also lose 2/3rds of 10% of their net worth. Something
to remember..

Politicians can hate on the wealth inequality, but it's a problem they
themselves have created in part through QE.

------
ghouse
In the US, a large part of this trend is due to the tax code. Examples: 1) in
real estate, a "1031 transfer" allows the tax payer to not pay tax on the gain
from the sale of property so long as they purchase another piece of real
estate. 2) Capital Gains tax rates are lower than Ordinary Income tax rates.
So, the tax you pay on income derived from wealth is lower than the tax rate
you pay on income derived from employment.

~~~
starchild_3001
Re: 1) it only applies to your primary residence. It's by no means the way top
%1 in wealth maintain or create their income. [Edit: I thought it does. But
I'm not so sure anymore. Better scratch this comment]

2) I'd suggest examining double taxation. Corporations already pay taxes. It's
unclear why an investor should pay additional taxes too on top of it, for the
same profit.

~~~
ghouse
1) That's inaccurate. From my own direct experience, it applies to any
investment property. 2) You're making an argument to not tax dividends, not
capital gains.

------
return0
Every simple RPG game must have faced this problem - the rich get richer
exponentially. Programmers sometimes introduce weird rules such as , the more
you have the costlier it is to buy sth etc. Capitalism has a real problem.
Piketty has exposed it adequately. People need to put forward solutions, to
get the money flowing again. Taxation is not the only solution, in fact its
impossible to get it right in today’s globalised economy.

------
wowisitlikethis
isn't inequality bred by our insistent concept of pecking order throughout our
organizations, which results in the people at the top of the stack hoarding
more than sharing...

simply just because they can, maybe this hoarding is fueled by the unease and
insecurity they they too feel. especially when someones livelihood is totally
tied to their job(healthcare, education, housing). in that kind of environment
can you blame anyone in an advantageous position to want to hoard so that they
feel secure against the winds of change. secure for their family more than
anything. imagine someone with a big family who loses their job and has to
feed all of them, has to be responsible for all their health-care, housing and
education.

some societies have created an environment where if you lose your job your
life is totally wrecked, seeing as most americans don't have a nest egg to
fallback on since saving is not really part of consumerist culture.

knowing all this, can you blame the 1% for wanting to feel secure? just like
everyone else. they have exaggerated the need to hoard and their bags of loot
provide long term comforts not basic needs.

------
tomashm
And many of them are not very sympathetic,
[https://www.npr.org/2018/02/19/586457604/whats-it-like-to-
be...](https://www.npr.org/2018/02/19/586457604/whats-it-like-to-be-rich-ask-
the-people-who-manage-billionaires-money).

------
amarant
I mean.. 1% controlling more than half of all wealth sounds bad and all, but
according to the article, quality of life has been improving faster than ever
for the remaining 99% too.. As long as that second part holds true, I don't
really care about the first part to be honest

~~~
cmurf
It's arguably unstable though, regardless of quality of life improving
overall. Things can, and have, changed very quickly. And so far the species
hasn't adequately predicted the sequence of events leading up to
destabilization, and how to avoid the inevitable equalizer: war

The top 1% should worry, but there's something euphoric about being that
wealthy, almost like oxygen deprivation.

[https://www.theatlantic.com/business/archive/2017/02/scheide...](https://www.theatlantic.com/business/archive/2017/02/scheidel-
great-leveler-inequality-violence/517164/)

------
perpetualcrayon
Plutocracy is to economics as inbreeding is to genetics.

~~~
dredmorbius
Howso?

~~~
perpetualcrayon
If beliefs were fluid and adapted continuously and were challenged by the
current state of the world I would maybe argue differently. But ask yourself
this. How frequently do you change your fundamental beliefs about how the
world works? How do you think the people who enjoy success beyond your wildest
dreams feel about changing the system that has benefited them and their
families for countless generations?

On top of that, which "causes" would you decide to support? Would you choose
to support a cause that disproportionately affects your family's net worth in
a negative way as long as it made the rest of the world a better place to
live? The fact is no one knows the precise ingredients to a healthy society or
what the real solution to wealth inequality is, but only the wealthy and
powerful get to steer the ship.

~~~
dredmorbius
Thanks, that clarifies and greatly improves your initial quip.

I've been changing numerous of my fundamental beliefs and can report that
perssonally it's been difficult, painful, and disconcerting as hell. There's a
quote on enlightenment by a recent Cupertino mystic I ran across a few years
back:

"Make no mistake about it -- enlightenment is a destructive process. It has
nothing to do with becoming better or becoming happier. Enlightenment is the
crumbling away of untruth. It's seeing through the facade of pretense. It's
the complete eradication of everything we imagined to be true."

Slightly more:
[https://old.reddit.com/r/dredmorbius/comments/78lr8h/enlight...](https://old.reddit.com/r/dredmorbius/comments/78lr8h/enlightenment_is_a_destructive_process/)

As for human frames, world mental models, and ideologies, they seem profoundly
tended to be highly self-serving, particularly of the powerful.

As to the relationship of wealth and power: "Wealth, as Mr Hobbes says, is
power." Adam Smith, _An Inquiry into the Nature and Causes of the Wealth of
Nations_.

------
thinkloop
> “If the system of capitalist liberal democracy which has triumphed in the
> west is to pass the big test of globalisation – and the _assault from
> radical Islam_ as well as its own internal pressures from post-crash
> austerity – we need some new thinking on ways to widen opportunity, share
> ownership and philanthropy. Fast.”

Sprinkle in a little radical islam fear mongering for kicks. This was funded
by the Labour Party - not saying the message about inequality isn't true, but
really strange to see that completely out of nowhere.

------
bitL
So the whole world would look like Brazil by 2050?

------
aantix
Does it matter? The expenditures for the US in 2016 we’re nearly 4 trillion.
Trillion. The top 10’s wealth if siezed wouldn’t even come close to that.

------
agumonkey
Until poverty become a rarity and they start to pay for it.

------
orf
So when do we get trickled down on exactly?

~~~
gaius
If you are reading this site in a Western country you are almost certainly in
the global 1%. Household income of $30k if I remember correctly.

~~~
lisper
No. The world's population is 7 billion so 1% is 70 million. That's less than
the population of Germany.

~~~
jgh
depends if the measurement is income or wealth. Income is like $32k, wealth is
much higher.

~~~
0xffff2
That doesn't really matter. The original claim categorically can't be true
given that the population of all "western countries" is much, much larger than
1% of the total population.

------
wilsonfiifi
two-thirds of all wealth? Not if cryptocurrency holders have anything to say
about it!

------
TekMol
Until the other 99% switch to a new blockchain where ownership is distributed
differently.

~~~
mimsee
That'd be ideal of course, but as of today, blockchain doesn't force equality.
China had a good grap over Bitcoin where the big money miners where due to
cheap electricity.

~~~
TekMol
That's why I said _new_ blockchain. A blockchain for the rest of us.

~~~
michaelmrose
Its profoundly unclear how merely throwing the word blockchain does anything
useful for equality.

Having a different way to record ownership doesn't change how ownership is
distributed. Logically the blockchain would be a good way to record ownership
in a more equal society in same fashion as forks and bricks would be useful
tools in a new and more equal society.

~~~
TekMol
Imagine you and I cannot afford each others services because all of the money
is owned by those greedy 1%.

So like slaves, we sweat away for them. Day in. Day out.

But if we agree on a new currency where you and I own 100000 coins each, we
can happily start working for each other.

~~~
michaelmrose
We can already vote in people who agree to redistribute the currency we
already have.

This doesn't appear any more revolutionary or likely. Why would any of the
people who own real resources like deeds, stocks, stores, things agree to give
them to you?

~~~
TekMol
Say you are a designer and I am a coder. As soon as we have a common currency,
we can start working for each other. No voting or stores needed.

~~~
michaelmrose
You will still be expected to pay taxes in the official coin of the realm and
will probably want to keep it in something slightly less volatile than current
cryptocurrency.

------
Mc_Big_G
This should make poor Republicans super happy based on how they vote.

