
Is Inequality Inevitable? - tomcdonnell
https://www.scientificamerican.com/article/is-inequality-inevitable/
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anon1m0us
> It is only redistribution that sets limits on inequality.

> In a flat redistribution scheme, all those possessing wealth below the mean
> would receive net funds, whereas those above the mean would pay. And
> precisely because current levels of inequality are so extreme, far more
> people would receive than would pay.

In their example, everyone has the same chances of winning/losing the same
percentage of their wealth with every transaction and eventually the money
trickles up until one entity has it all.

However, this is not how markets work. You don't spend or gain a percentage of
your wealth in each transaction. It's more generally a fixed fee. Bread costs
what bread costs, not k * wealth.

And, frankly, not all people are created equal. Not under the law. Not
physically. Not geographically. Some people have advantages over other people.
I know we'd like to ignore that, but we can't and we have to stop that.

The reality is, some people are born with disease. Some are born in the slums.

This is not _fair_ and as a society, we should have some mechanism to balance
our placement in life. I say this being born with great advantages over almost
everyone. I wasn't born rich or even with a father but even a single mom
wasn't enough of a disadvantage to stop me from approaching the top.

I live with this ... _guilt_. Why do I deserve something better than my
neighbor down the street with one leg shorter than the other? How do we
mathematically quantify the fairness of that?

We don't choose our lot in life when we are born, yet we claim everyone is
equal. No they are not. We might all deserve the same rights and
responsibilities, but some are smarter, cuter, stronger.

Where this comes into play is: Envy. When envy grows, bullying increases.
Those with more are intentionally or not, socially disadvantaged by those who
have less. In fact, those who have more will find themselves producing less,
retracting into the shadows to go unnoticed by those with less. We build walls
around our houses.

I _am_ "privileged" so to speak. I despise that language and that social
movement, but I came into the world better off and can't justify any sort of
deserving it. I wear that badge with a sadness for those who have to work
harder, try harder, struggle more.

I don't think there is a realistic solution except periodic wealth
redistribution like the article suggests. I would give up some of mine for a
better, more just world.

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mdorazio
This is an excellent article with nice thought experiments and a practical
model. Key takeaways for me:

"The very first coin flip transfers money from one agent to another, setting
up an imbalance between the two. And once we have some variance in wealth,
however minute, succeeding transactions will systematically move a “trickle”
of wealth upward from poorer agents to richer ones, amplifying inequality
until the system reaches a state of oligarchy."

1) Winners can be completely determined by luck, much like in real life (and
especially business). And 2) without anti-oligarchy policies, wealth
accumulation to a few people is built into capitalist (or is it just scarcity-
based?) systems.

"We found that this simple modification [flat tax on wealth] stabilized the
wealth distribution so that oligarchy no longer resulted. And astonishingly,
it enabled our model to match empirical data on U.S. and European wealth
distribution between 1989 and 2016 to better than 2 percent."

So if you want to keep capitalism, but prevent utter inequality the
implication is the best way is a wealth tax.

