
Billionaires haven’t earned all they have - proxybop
https://www.marketwatch.com/story/billionaires-take-more-than-they-make-2019-02-07
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jdkee
I don’t necessarily have a problem with a person having a billion dollars. I
do have a problem with the influence of money in the U.S. political system.
Moving to federally and state funded election would be a start. That and a tax
on wealth, not income, that would erode the accumulated assets over a
generation would lead to greater equality.

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orev
I agree that changes need to be made, but a lot of the “wealth tax” discussion
that has been going on lately would directly impact most people’s retirement
plans (in the US), which are based on 401ks and other investments. Since we
don’t have pensions anymore, and Social Security isn’t sufficient for a lot of
people, building wealth is one of the only remaining options.

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edoo
There are basically 2 ways to make money. You can provide value where people
are willing to voluntarily trade their own labor for that perceived value, and
taking it by force. Bill Gates is an example of both. His contribution and a
lot of the money he earned was because the value of his product was worth far
more to people than the asking price. He received a fraction of the value he
created in the world. He also got the government to give him a monopoly on the
ideas that were implemented, preventing others from implementing those ideas
with violence. I'm in the camp that says the latter is inexcusable in a
society. I suspect gates and most billionaires would not be billionaires if it
weren't for the monopoly protections enforced by government. Where would the
rest of that wealth have gone? To anyone who was able to compete against the
ideas.

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iudqnolq
That's definitely possible. But it's also possible no one would have spent the
time to come up with the idea if they knew someone else could build on their
work and release the same thing for cheaper.

I don't know which is true, although I have suspicions, and unless you've
revolutionized the discipline of economics (and decided to inform the world in
Internet comments) your certainty is unwarranted. You could have at least
acknowledged that counterarguments to your thesis exist.

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edoo
I think Linux is a counter example to that. A lot of commercial companies have
contributed to the evolution and made a lot of money competing with each other
delivering support for public projects. Linux has added a ton of value to the
world yet there are no companies or people approaching the value of MS. The
wealth was distributed via competition and a lot more of it stayed with the
customers than othwerwise would have.

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iudqnolq
Open source is a good example of people not acting for immediate monetary
gain, you're right, although legally the licenses rely on copyright law.

I absolutely didn't mean to say the comment I replied to was necessarily
wrong, I wanted to point out the commentator made a confident claim that
completely failed to address any of it's well-known counterarguments. I meant
to criticize the commentator for failing to acknowledge that reasonable people
have argued against their case; if I had used that to make a case that their
argument was wrong I'd have succumbed to the ad-hominem fallacy.

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stevenalowe
I stopped reading at “Most wealth is created, maintained and sustained by
extracting unearned rents from the rest of us” because that is a description
of a zero-sum situation; it is impossible to _create_ wealth that way, one can
only redistribute it. Bill Gates for example created a company that was valued
by the market at many billions of dollars, billions of dollars of value that
did not exist prior to Microsoft. He did not “trick me into paying more than
necessary for something out of ignorance” (asymmetric information), but
instead created a tool worth thousands of times its cost to me (a software
developer).

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anovikov
Saying that there's something bad in 'rents' is a hypocrisy. Every income
which is not a job, is rent. Profit from every business, economically, can be
split into rent and (real and/or virtual) salary of the owner (with small
business usually being wholly or mostly "salary"). You can tell there is some
non-"salary" component when you can sell your business for the price higher
than liquidation price of it's physical+financial assets. That price is a
capitalized cost of the rent. There's nothing morally wrong with it.

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clairity
no, rent is (non-value-creating) income from simply owning capital. capital
put to productive use, along with labor, generates profits, which is
compensation for value creation.

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anovikov
But owning capital comes about when you have a competitive advantage.
Basically, if you make some profit but can't sell your company, you are just
working your ass off: it's a job (say a typical software dev agency is). With
maybe a modest premium for risks. Goal and only point of business is exactly
rent-seeking, this is what capitalism is: profit you get on a capital is rent.

And yes, rent isn't value-creating. You created value when you well, created
that capital which gives you rent. Value is the capital, not rent. Then yeah,
you just sit on your ass and milk it, or just sell. Every capital is a
monetary expression of the value of the unfair, rent-creating advantage you
got. There's nothing wrong with that.

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RhysU
> And yes, rent isn't value-creating.

Some rents create value.

Say that I am a construction company and I need a huuuuge crane to complete a
building. I can borrow money to buy the crane (rent goes to the person who
lent me capital) or I can lease the crane (rent goes to the person who lent me
capital in the form of a crane). Either way, no rent no new building. Someone
values the building otherwise I wouldn't be building it. Hence, rent creates
value.

Suppose I am a working stiff and I need a huuuuge house to raise a family. I
can borrow money to buy a house (rent goes to the person who lent me capital)
or I can lease a house (rent goes to the person who lent me capital in the
form of a house). Either way, no living space no family. I value my family
otherwise I wouldn't be building it. Hence, rent creates value.

