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People Don’t Actually Want Equality, They Want Fairness (evonomics.com)
214 points by allenleein 99 days ago | hide | past | web | favorite | 152 comments



As interesting as Frankfurt can be, this semantic quibbling is unhelpful. When most of us progressive types speak out against "economic inequality", we are not saying we want everybody to have equal wealth. The concern is about rising inequality, of increasing wealth concentrated in an increasingly tiny percentage of the population, while millions struggle to get by, often one bad month away from financial ruin.

And yes, of course we care about fairness. There is nothing insightful about presenting it in contradistinction to concerns about inequality, as though it's the thing we are "really" concerned about. Fairness alone does not guarantee a society where the outcome for the unwealthy is tolerable (unless you're John Rawls). Hence, we care about both.


> ...increasing wealth concentrated in an increasingly tiny percentage of the population, while millions struggle to get by...

I think these discussions are immensely helpful. Mostly because they give us clear criteria for accepting and rejecting proposed solutions. Many people, for example, are for confiscatory taxes on the rich to level the playing field.

Your sentence here, for example, implies that the wealth concentrated in the hands of the tiny percantage of the population would relieve the millions who struggle if it were just redistributed. I don't believe the numbers back that up. As rich as Gates and Bezos are, they can't fund healthcare for everyone. Which is why redistributive tax schemes aren't about using the means of some to fund the needs of others as much as creating fairness (or at least the sense of one).


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Care to specify which terms?


it's not about their money. Money is the power to choose. In a very real sense, the profit extracted by enterprises represents opportunities lost by their customers. Had profit generating goods and services been priced at the market clearing, efficient level then the end customers would have kept some of their own money. They could then make new choices with that money. In aggregate on the supplier side, that reaped profit represents choices individuals could have made but now are unable to do so.


You are committing a major logical fallacy here, in assuming the initiative and use of capital to create products and then choosing to extract profits after taking that risk are independent events. Profitable goods often will not exist at all unless they are profitable. (Consider in an extreme example, pharmecuticals.)

You are also mixing up margin and market clearing price. The market clearing price includes profit. Just because a product is profitable that doesn't mean there are any inefficiencies in the market. On the contrary the price a market will bear for a product prices in profit insofar as there is a lack of supply to meet demand. Market inefficiencies come about due to illiquidity, regulation, abusive monopolies, etc, not simply because someone is making a profit.

You can't just imagine up a world where enterprises sell with zero margin -- in many cases the alternative is the products just simply wouldn't exist. This alternative reality is much worse for consumers.


Understand, but that's not exactly what I'm arguing here. Pharmaceuticals definitely need big pocket books to finance medical research. But market forces alone are clearly not the answer for even that market. There are many illnesses not profitable enough to warrant medical research - and people suffer and die as a consequence. In effect, then, the profits pharmaceuticals make on one medication are really then coverage for later costs. That makes them not profit anymore.

I'm not saying the world needs 0 margins. If anything, that's contributing to the problem. Walmart and Amazon are good examples. Their cost structures have annihilatd entire, local economies.

My Sunday morning guess would be to look for ways to lower the entry costs for businesses. Maybe municipal level infrastructure for local consumers? I don't think "trust busting" would work in isolation. Over time, the markets probably re-concentrate.


You cite Amazon and Walmart as bad actors since they have 'annihilated local economies' -- but at the same time, they have delivered untold amounts of value by lowering prices to nearly (or below) cost for millions of consumer goods. Not to mention the time they have freed up from peoples' lives having to spend time purchasing items at various brick and mortar stores. Would it really be better if mom and pop stores were selling the same products at higher costs, wasting immense resources in the process (subsidized by consumers and possibly tax payers) due to lack of efficiency and scale?

How do you speak so confidently that they are "contributing to the problem?" It is a hard sell that they are abusing their market dominance, because of the very fact their margins are so thin. Since there are multiple market leaders, and their margins are thin, this implies they are competing fairly. You seem to take it as a given but it's a hugely complex question. I'm all for trust busting large companies abusing their power -- abuse which usually manifests in large margins.


> Money is the power to choose.

OK. So if it's not about justice broadly but about economic liberty specifically, that's fine. Then the conversation is about which economic liberties are due and how much those would cost.

A popular one is "People shouldn't have to lose wealth or gain debt because of health problems". That's an admirable goal, but taking all the money from the top 1% won't result in free universal health insurance for long. That approach still seems like it's reaching for something else.

You seem to be making a more upstream argument, though. That U.S. (and Western?) markets are structured to favor the wealthy, limiting the power of markets to reward the poor and working class for good choices, hard work, and so on. That's a great point to consider, but what approach would create a level playing field?


Figure out the factors that concentrate markets and counteract them.


Per the IRS, the total income of the top 5% of households is $1685472000000, which, when divided among the 139,960,580 households submitting tax returns, comes out at $12,000 per household. That sounds like it's in the ballpark of what you'd need for healthcare, US idiosyncrasies notwithstanding.

Now, of course nobody is realistically suggesting taking all that money. That would be neither fair nor useful. Because everybody agrees that some reward is necessary to motivate people, and that they should get to enjoy the spoils.


That number just shows why “tax the rich more” isn’t the way to pay for services everyone uses like healthcare. Top 5% isn’t just Bill Gates and Warren Buffet. Bay Area engineers will hit that living alone. So will a couple where e.g. one person is a nurse and another is in IT. It’s a very expansive group.

Total spending at all levels of government in the US is almost $7 trillion. So even if you tax the top 5% at 75%, you’re covering 17% of total expenditures. European countries don’t build their welfare states by heavily taxing the rich. In say Germany, an entry level office worker will pay 30%+ of their income in taxes and mandatory insurance.


> So even if you tax the top 5% at 75%, you’re covering 17% of total expenditures.

And that's assuming a 75% effective rate, which you can't get at the 95th percentile without also charging high effective rates to the majority of people because it's not possible to charge more than a 100% marginal rate on the difference.


> European countries don’t build their welfare states by heavily taxing the rich

Idk according to my swedish coworker, there was a marginal tax rate of 70-80%++ from like 1940-1985 or something.


Sweden taxes everyone heavily: https://taxfoundation.org/how-scandinavian-countries-pay-the.... The top marginal rate kicks in at 1.5 times the average income. Sweden also relies heavily on the 25% VAT, which is disproportionately borne by the lower brackets.

Here is a hypothetical calculation of someone making $120k USD who is married with two kids: https://home.kpmg.com/xx/en/home/insights/2011/12/sweden-inc.... Such a person pays roughly 50% in total taxes. In the US it would be roughly 25% (in Maryland).


In the US it went up to 90% in the early part of that timeframe.


It's important to realize that nobody really paid those rates in the US. At the time the rules for what could be claimed as a deduction were so lax that people were making $80,000 or more in deductions against $100,000 in income.


I've heard this argument a lot, does anyone have any good sources to confirm it?


So don't tax the rich more. Tax the ways by which the inequalities arise. Create counter forces against market concentration. For instance, if there really were alternatives to desktop Windows and Mac desktops (from the hardware through to software levels) then computers would be more affordable and wide spread. That affordability has an income increasing affect on the customer side.


How would this be enforced?


My bet is once you're talking enforcement the markets are already concentrating. Maybe something like UBI? I don't have all the answers.

Maybe the federal government offers lower tax rates based on how many different states the company has a sizeable portion of its labor force. Ie near zero for being spread out everywhere.


I don't think you understand the vast gulf between the top 5% and the top 0.1%. If you hit the top 5% hard you are just going to slam tons of small business owners, software engineers, doctors, lawyers, professors, etc.


yeah, the top 5% includes basically any married professional couple, and any above-average successful individual like a small business owner or lawyer or consultant. they aren't "rich" people, although they likely may be one day.


They aren't rich? Let me get my tiny violin out!

It's not about whether they are rich but about whether they produce income that can be taxed to pay for the needs of the poor.


i didn't say they deserved your sympathy, you projected that onto me because you have a political agenda.

good luck with the taxes thing though.


But why would engineers be excluded? Why should a software engineer make $250k+? S/he is just sitting in a chair typing, while the person who cleans the bathroom or make the food in FB' cafeteria gets nothing.

Isn't that unfair?

I personally recommend that we start in small experimental grounds. The idea of starting in the Bay Area is good because engineers are pushing hard workers into poverty, but they they go around with masks hitting people on the head with sticks just because they speak their minds.


That's just basic supply and demand and it's not unfair. Jobs where demand exceeds supply are paid more and more until people decide to train/retrain for that job.

The unfair part is that the 250k income of the software engineer is increasing demand for housing until it's too expensive for the cleaner although the demand and therefore price are high enough to warrant more housing it's not getting build because of zoning laws.


That's just basic supply and demand and it's not unfair. Jobs where demand exceeds supply are paid more and more until people decide to train/retrain for that job.

You say that's fair, but someone else could say it is unfair. The supply/demand equation you describe suggests how the salaries get decided upon, but that's not the same thing as fair. That's the system we have, but that doesn't make it automatically fair.


Of course it is supply and demand, but they are creating these conglomerates that inefficiently aggregate wealth into a few. All of them are part of the problem. Why are only the top 1% ones the problem? Those are the ones who created the system of unfair enrichment, but share unfair gains to a few to keep the machine working.

I mean, why should someone jump into the 1% simply for being engineer #2? Those gains are unfair, and should be taxed 100% to pay for healthcare for all.


Why are only the top 1% ones the problem? Those are the ones who created the system of unfair enrichment

No, they aren't. The system is older than any person alive today. It's older than people. It's a natural law of the universe. It's game theory and natural selection, ultimately, that plays the fundamental role.


Why should a software engineer make $250k+? S/he is just sitting in a chair typing, while the person who cleans the bathroom or make the food in FB' cafeteria gets nothing.

It isn't about rewards or even about what's fair. It's about the market. You pay an engineer a lot of money because you need an engineer to do the job and the supply of engineers is low. On the other hand, the supply of people who can clean bathrooms is effectively unlimited. There are far more people willing to do the job than there are jobs for them to do.


The market says a CEO deserves $100m per year. Is that wrong?


When you have a company with $20B in profits, a CEO who can increase profits by 0.5% is worth $100M more than one who can't.


> Why should a software engineer make $250k+?

Because people are paid for the value of what they produce, not the effort they spend producing it.


Why should a person make $10m?


If I can produce something that will benefit 10 million people such that they would gladly pay $1 each for it, but I'd just as soon not do it unless I get paid that money, then it's in the interest of those 10 million people that I get $10M for my work.


How much should we tax you, as a 0.1 percenter?


More than 0% and less than 100%.


It's not just about getting to "enjoy the spoils". You would be taxing 100% of income, making working at all meaningless. There would be no money to support the household.


I'd imagine it being more helpful to look at military spending and amounts of money big companies are hoarding (looking at you Apple) to see where the real issues lie.

As long as people are ok with their money going into a mystery box they have no control over, holding no one accountable, how can we have anything BUT inequality?

As long as companies are free to play tax games and suck money out of the economy and then hang on to it for as long as they feel like it - how can we have anything BUT a screwed up volatile economy?

People talk about redistributing money as if there's a million rich people wiping their butts with 100$ bills and if only we could teleport that money outta their toilets, into the hands of those in need, we'd solve something.

Real solutions to real problems come with infrastructure, accountability, transparency.

They start in the mind, then go out into the real world. As long as in your mind it's republican vs democrat, rich vs poor or some other childish false dichotomy, we'll be right where we are, heading for serious social unrest.


How would you tax Apple? Realistically basically all taxes on corporations simply result in added cost the consumer. You may think you're taxing Apple but you're really just taxing the consumer extra.

As long as all their competitors are subject to the same tax, the price simply rises. This is why Apple products cost much more in the EU. Of course, if it were cheaper for a company to be located somewhere where they would not be subject to that tax, then you're simply just motivating them to relocate.


Doesn’t Apple pay some of the highest tax rates?


It's not so much about tax rates and I haven't looked into it too deeply - although I'm sure the big companies hire the best accountants to use every loophole in existence.

I am referring to this: https://www.cnbc.com/2017/05/02/apples-cash-hoard-swells-to-...

Companies should not be allowed to simply hang on to 250 billion dollars.

Imagine what could be done in science, infrastructure, services etc if 10% of that money went towards those things.

There's a great Peter Thiel clip about this that sums it up very well:

https://www.youtube.com/watch?v=2Q26XIKtwXQ


> Conpanies should not be allowed to hang on to 250 billion dollars.

Why? They earned it. And have you seen how much Apple donates to charities? Bill Gates at one point had a net worth of over 100 billion dollars before donating a huge sum to charity. If 250 billion is too much, what is a good amount?


>Now, of course nobody is realistically suggesting taking all that money.

Right, we're suggesting seizing the means of production. Don't redistribute, predistribute!


I think the top 5% is not a complete source to pay for healthcare. But I think the top 15% is. Under some assumptions of incremental tax increases across the board, to distribute better and pay for healthcare needs, taxing the 80% at a flat 80% could do the trick.


For one year...


Ok, take all that wealth and we would spend it in one year on health care.

What do we do year two?


Quite right. It's about equality of opportunity.

Many of the more egregious examples unequal wealth in current society typically stem from previous inequality of opportunity passed down through generations, so the pressure to correct the wealth imbalance and the inequality of opportunity gets mixed together.


Equality of wealth is too strong a condition, but when you start to think about it, equality of opportunity is actually a pretty weak one. Of course, it would be good to have - I don't disagree with that. But one of the things the principal of equality is supposed to rule out is slavery. Suppose everyone is given the same education up to age 12, was then required to take an exam , with the top 1% becoming owners of the other 99%. That would still be equality of opportunity - but I think you'd agree that wouldn't be real equality.

What I think people mean by equality is that it should not be possible for an individual or group to obtain some overbearing degree of dominance over another individual or group. So that even if there is a disparity in wealth, there should still be a sense in which you are dealing with each other as equals.


> What I think people mean by equality is that it should not be possible for an individual or group to obtain some overbearing degree of dominance over another individual or group.

I think this is the crux of the issue, and money most often is just the most relevant and quantifiable measure of that.


Rawl's "Veil of Ignorance" allows for _some_ inequality, but only as much as you would allow being born into if you didn't know where in the world you'd be born.


> stem from previous inequality of opportunity passed down through generations

There's a positive aspect to this as well, though. My grandparents (coal miner and steel miller) made sacrifices and investments in order that my parents could be the first generation in their family to attend college and become school teachers. My parents made sacrifices and investments in order that my siblings and I could attain a better life than they had.

My wife and I are making sacrifices and investments to help our children attain their individual maximum potential and satisfaction in life. Instituting a giant red "perfect reset button" for each generation precludes the sensibility of those investments and I believe harms society overall.


Is anybody actually proposing a giant red reset button? Because that seems like a particularly egregious straw man to me.

Parents being good to their children is great. Parents sacrificing for their children is great. Keep doing it. But when what is given to child A comes at the expense of child B, then that is not so great.

As an individual, definitely please do focus on your children. But when we're talking about how we design society, we have to look at all the children.


Why? I don't see any way in which it would be "fair" to get an advantage (or disadvantage) because you happen to have been born in a particular family, which is a random process. Of course, there are implementation difficulties associated with it - how would you enforce something like that - but in essence I think it's a pretty good idea.


I have a dollar. I can spend that dollar or save that dollar. If I save that dollar, I can spend it later or have someone that I care about spend it later.

My kids, by luck of birth, were born into a family that values education; we read to them every single night, do crafts, science, engineering things, and tend a garden at home. Why is it fair that they get those advantages?

In addition to being barred from passing along the money I don't spend in retirement, should I also be blocked from reading to my kids more than some community maximum; should our library or museum trips be capped? Should kids be blocked from getting grandma's wedding band just because it has an economic value?

I don't work and save/invest only for myself; I do so for my family, including those who will actuarially live longer than me.


Well, the argument about being blocked from reading to your kids is a pretty good one. Never thought of it like that. You convinced me. Thanks.


There are people out there that believe that sort of thing:

http://www.nationalreview.com/article/417997/professor-if-yo...


Beyond a certain threshold (or complex set of conditions) accumulated wealth can become self perpetuating. No U.S. legislation I can think of actually affects the sort modest wealth you're describing, but there is arguably some social benefit to limiting future returns to inherited capital.


You and your family also don't exist in a vacuum - you benefit from the society you seem content to watch crumble around you so "your" money (a government created instrument) you made at a job that wouldn't exist without the society around you and using services falling into disrepair and rot because you're dumb enough to conflate hoarding wealth with reading.


> the society you seem content to watch crumble

Steady on, pal!


It's not a random process. Babies aren't allocated by the stork.


The richest people in the U.S. aren't Hapsburgs, Rockefellers, or Kennedys. They largely started out in upper middle class, maybe a little better off than that, and then founded huge empires based on a combination of business savvy and innovative disruption. The Waltons inherited their wealth, but the ones on the richest people list inherited directly from Sam Walton, whose story certainly fits that bill.

"Passed down through generations" makes it seem like there's some sort of grand lineage, and I haven't seen any data to back that up.


You're mostly right. Unfortunately, there are enough extremists who want actual total "equality" (whatever that means - should beautiful people get scarred to be more equal?) that it's an easy straw-man to use for the regressive types.


> Unfortunately, there are enough extremists who want actual total "equality"

Are there? Where are they and how much influence do they have? As far as I can tell they are extremely rare and have little to no power. In contrast, the number of people who are market maximalists in actual positions of power is significant.

Interested to see any evidence that my world view is wrong.


That is a big point of contention. One side says we already have equality of opportunity, and that the current state of things is a result of a normal distribution in skills/motivations/abilities in the population.

The other turns that around and says no we don't because "structural racism/sexism/classism/etc".

So, they argue against each-other because one sees the current inequality of outcome as a consequence of some sort of "biased" fairness in opportunity. And since the other side disputes the existence of that bias, they think that what's being advocated is pure equality, irrespective of any distribution of skills/talents/etc.

It's an impasse, and we'll never get passed it until we start agreeing and quantifying the possibility that there are differences between sexes/races/cultures/ages. Only then can we correct for any supposed structural biases. It's a touchy topic, and one only need look at the type of controversy The Bell Curve book caused to understand the incredible difficulty that we face trying to conclusively resolve this scientifically.


This is a common argument but it's based on the incorrect assumption that existing difference must dictate the way we shape and envision a future society. It's based on the naturalistic fallacy and is also historically blind.

If you look at history of mankind, you will see that at any stage the existing differences seemed insurmountable and later nevertheless changed. You can look anywhere from the Roman empire (i.e., essentially a fascist militaristic society for a long time), over women's rights, slavery, colonialization etc., it's always the same pattern. The status quo has never defined how a desirable society should look like. As a typical example, many women used to agree that it's pointless for them to vote, since they don't know anything about politics. Maybe these were even in the majority at some time. Nevertheless they've changed their mind.

To cut a long story short, history is full of alleged anthropological constants that were used to justify inequality and all of them turned out to be false and nonexistent. Heck, landowners used to say about peasants that they are just too stupid to own their own land and would immediately gamble it away...


There most definately are, although not extremely common. I recall reading a HAYES (pro-fat) article calling for beauty equalization or some rediculious thing. Sure its not common, but to dismiss any extreme you arent aware of does not help the conversation. The amount of impact is highly variable, but one must assume there is some, as many of these blogs have thousands of followers.


> Are there? Where are they and how much influence do they have? As far as I can tell they are extremely rare and have little to no power.

Quite a lot, one was a presidential candidate complaining about the wage gap, which is an argument for total equality, not equal opportunity.


While this may in fact be true the messaging most people hear is purely concern about inequality alone. Like most nuanced ideological positions as soon as they go mainstream all of the nuance is lost. This is probably a significant part of the political divide in the US today.


> When most of us progressive types speak out against "economic inequality", we are not saying we want everybody to have equal wealth.

Someone made the choice to use the term "inequality" and it was remarkably clever because it has a builtin foil. When people object, proponents can say "well of course we don't mean no inequality at all." This is what weaponized rhetoric looks like.


I think there's another aspect to the fairness too. Not just the magnitude of the pay, but the way that it is decided.

There is a perception that a small group can apparently give themselves pay rises without being constrained by the same controls as others, thanks to the 'old boys' network.

I think this is a root problem.


If the issue isn't fairness, how do you differentiate this view from an embrace of punitive envy politics?


as opposed to power equalization politics.


"Fairness alone does not guarantee a society where the outcome for the unwealthy is tolerable "

Why not?


Because the market value of just being average in what you can do could be below what we deem tolerable.

It does depend a lot on what's tolerable, admittedly. As long as we reason about it knowing that wether we like it or not, many of these people living in less than desirable circumstances will have kids and those kids have never done anything to effect wether or not their situation is tolerable.


I'm not sure macroeconomic systems affect the kids as much as socioeconomic ones like household mobility, addiction rates, mental health care, and family structure.


Yes, but then we're incentivizing the future supply of such "below average" individuals that you speak of. That in turn reduces their value by making it a race to the bottom. Which of course, causes our caring society to kick into even higher gear in terms of "caring" for them. And so the cycle continues, with the bottom half eventually tipping the scale immensely. That is why you're getting "inequality", because you're subsidizing its increase without fixing any of the underlying problems.

Edit. Grammar.


A society claiming the unwealthy tolerate their outcomes because of its exceptional fairness has to prove that unwealth arises from a person deciding to abuse their own chance at wealth by more than the fair treatment society entitles them to (because those ending up wealthy were ostensibly assumed to be given no unfair advantage).

If fair treatment from society (for the purpose of equal opportunity to wealth) results in unequal but 'consistently fair' wealth outcomes, then the explanation for the unwealthy individual's outcome must be disavowal of wealth "after being given the same chance everyone else had" Which implies that, since fair treatment failed to ensure the goal of wealth was as reasonable for them as anyone else, then the sole remaining factor is supposed individual disavowal - which tautologically represents an intolerable situation after all..


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That's the sort of low-quality insult that isn't really welcome here, but I'll dignify it by pointing out that Warren Buffet is among those calling for higher taxation of rich people.


Just look at history, or current conditions in some parts of asia: child labor, 16-hour days in overcrowded fire hazards etc.

But the more general point is: do you value an individual solely by what they can produce?

Extreme example: Late at night, Mr.&Mrs. Miller get in a car accident and die. Their 5-years old daughter survives. She is not capable of sustaining herself with productive work. Is it fair for her to die?

Yes, it's extreme. In any sane world, someone would somehow take the girl in and provide for her until she's old enough.

But taking in an orphan and caring for them is already altruistic. Continue down that path, you'll soon stumble upon a social safety net that canonises these instincts. That's better than individual initiative because:

- it can distribute the costs of caring equally, instead of burdening, say, one family with all the costs of raising little Amy Smith

- it's fairer: your survival should not depend on you being cuter than someone else in need

- it's dependable: there's value in knowing your child will be cared for should you suddenly be hit by a bus


The fact that you have to make this distinction in order to clarify the progressive case shows a rhetorical weakness in the position.

Progressives should want to avoid this having be part of the field of discussion. You don't want to get into a fight about what you really mean, particularly when there are so many who are eager to misrepresent progressive motivations precisely as the desire to try to make everyone equal in outcome. And this makes it trivial for political opposition to persuade people who value conscientiousness to be suspicious of progressive positions.

Just start with "fair deals" as the value.


The assumption there is because the rich have something the poor must have less. In a monetary economy where bitcoins are mined by running a computer that is of course nonsense.

Its perfectly possible to leave the rich with monetary wealth that they can show off to their friends about while the poor have material sufficiency - which is what they care about because they are more interested in their communities than coin collecting.

The problem is the assumption that there is a one to one relationship between money and stuff. There isn't.


Wealth will help the rich win zero-sum games against the poor. The most important zero-sum games being political power and social status and desirable land.


I agree with both statements. It's not because a rich person has more, that poor people have less.

If we were to start from scratch and redivide all the wealth in the western world between the people, it wouldn't take long for some individuals to rise to the top again and build up their net worth.

However, with wealth also comes power. There's just so much more you can achieve with good money in the bank. One simple example: a wealthy person with the good lawyer will almost always end up receiving a lighter sentence (if any) in comparison to the poor person with the shitty lawyer (if he even has a lawyer). That is clearly unfair, yet the way it is.


> However, with wealth also comes power.

This is certainly true. What's not clear is whether that power can be redistributed equally or if addressing it just leaves a vacuum of power and the risks that entails. More concretely, there hasn't been a form of campaign finance regulations that has actually achieved its goals in the U.S. At least so far.

If the rich couldn't fund their unfair legal teams, would the justice system be more fair? Or would it just give more power to prosecutors who wouldn't have their actions challenged and appealed as often?


The idea that you can change power by removing wealth by force has the same legitimacy as believing you can extract an egg from a baked cake.


Hmmm, don't events like the French Revolution counter that?


It was only a temporary measure, if you ask me. More like a vacuum was created, and a new set of wealthy people took the positions.

http://piketty.blog.lemonde.fr/2017/04/18/inequality-in-fran...

So I'd say no, it's not really a counter. There is something else, something intrinsic in our society, that causes the existence of the wealthy. Or "inequality" as others like to call it.


Ah yes, and modern constitutions and democracies came to be from goodnes of old aristrocratic hearts!

Events like french revolution were key drivers of reforms that brought around the modern democracy. While they weren't as bloody outside of France, they certanly did influence movements in other countries across Europe and forced their absolutists to accept the necessity of a parliament to curb their powers.

Even IF new wealthy people took the positions, they end result for general population was an improvement of living conditions.


I don't understand your bitcoin example.

If I understand bitcoin, the work of mining increases as more bitcoins (wealth) are produced.

The rich can buy more mining hardware, start/hire mining services, etc. than the non-rich. Over time, those who can invest in higher performance mining get wealthier than those who can't.

Over time, this would seem to concentrate bitcoin wealth among fewer, wealthier people. Am I missing something?


> In a monetary economy where bitcoins are mined by running a computer that is of course nonsense.

well the rich can buy ridiculously performant computers...


That's quite a generalization about the attitudes of the rich and the poor!


>When most of us progressive types speak out against "economic inequality", we are not saying we want everybody to have equal wealth. The concern is about rising inequality, of increasing wealth concentrated in an increasingly tiny percentage of the population, while millions struggle to get by, often one bad month away from financial ruin.

Eh, I definitely care about at least some degree of real equality of wealth, because wealth just is the material basis for both political power and personal freedom. What I terminally care about is equality of choice: the mostly equal ability of people from different origins in society to make meaningful choices based on their own needs, desires, and values.

Not everyone can become an astronaut or a CEO, but if someone's born to a poor family in a minority neighborhood, we still want their choice to pursue being an astronaut to meaningfully affect the course of their life. Better that they make it into the Air Force and fail to make astronaut on their own merits than that they never get on that track in the first place because their station in life stops them from learning high-school physics.


However, there are many domains in which this kind of "semantic quibbling" is helpful. Propaganda is a good example. The success of a given "pitch" might well depend upon understanding the distinction at issue here. It might be a mistake to confuse the two, or it might be to one's advantage to exploit the conflation.


This is especially true when one confronts the simple fact that, particularly in a political context, terms immediately lose their meaning in the sea of rhetoric. Just look at the term "liberal." Hahah wow. What a loss of value that word has had. It's practically become a slur, when ironically it should be a word that describes every single person with the slightest preference towards American style democracy given we enjoy a LIBERAL DEMOCRACY

But I digress. The point is, the words equality and fairness mean nothing in a rhetorical context. One can not possibly approach the idea of correcting the audience's perceptions of those words. So if switching the word you use in your "sales pitch" of policy gets you closer to the idealistic end, then that is what should be done and it should be done without hesitation.


Yeah, I find the view of "equality" here to be weirdly specific. He seems to mean equality of allocation of goodies, and he seems to think that if it isn't the only thing people want, then they don't want it at all.

Sure, I don't want a hellscape where everybody is equally miserable when compared with a well-off world where most people are happy and some people are miserable. But if I have to choose between an equal hellscape and a hellscape where some people are merely miserable and others are extra-screwed, then I'm going to pick the equal hellscape. I want both happiness and equality.

The biggest omission to me here, though, seems to be completely ignoring power. Economic equality is tightly bound with the distribution of power. Powerful people have an easier time getting rich; rich people have more power across many dimensions. People signal their power and status through economic expenditure.

Somehow, though, the word "power" doesn't even come up here. Maybe the thing people "really" want (if that framing isn't entirely broken) is equality of power. That shouldn't be a surprise in that America had a whole revolution about that, and then a civil war to boot.


If you truly don't care about not everyone having equal wealth, then an increase in the division ought not bother you, either.

Would you say, "I don't care whether public buildings and fixtures are clean and free of damage or not; I'm just concerned about any increase in vandalism."


I agree with you but would like to add some remark about "fairness". This is a very broad term that encompasses many different issues. Principles of resource distribution are just one aspect of it.

I have never met anyone in my life who argued for a completely egalitarian society but for some people, a more egalitarian society is fairer than a less egalitarian society, other factors and reasonable bounds notwithstanding. In fact, the vast majority of people fall into this category, since almost no one would want to live in a society with Gini index 1.

If you ignore a few extremely radical die-hard libertarians whose positions are in my opinion not worth to be taken seriously (yes, I've read some Friedman, etc.; no, they are not more reasonable in their assumptions about human nature than communists), then the disagreements are more or less about:

- just amounts: the levels of resource distribution that one would consider just, e.g. the Gini index one considers acceptable (or other indicators - that's all part of the debate)

- just means: the mechanisms of resource distributions or other ways of obtaining a more egalitarian society that one considers just

- acceptable trade-offs: the trade-offs between methods of resource distribution and other moral, individual and moral principles like the Pareto principle, maximization of individual freedom, solidarity, democratic division of power, the right to a due process, etc.

The Pareto principle is economic and a right to individual freedom is perhaps best described as an ethical principle, but most of the other fundamental issues like Prioritarian or Egalitarian resource distribution principles, equal access to common goods, equality of opportunity, or democratic power division principles all concern different concepts of fairness. It's a fairly broad-reaching term and there are many trade-offs to make that define different political views.

My personal view is that nobody needs billions of dollars to lead a happy and fulfilled life and that various democratic mechanisms to generally decrease differences between income classes are desirable and ultimately lead to a better life for everyone, including the richest. But I understand that other political positions weigh some of the above ingredients differently.


> My personal view is that nobody needs billions of dollars to lead a happy and fulfilled life

I think having (needing) that much money is generally an indication that you don't lead a happy and fulfilled life.


> we are not saying we want everybody to have equal wealth. The concern is about rising inequality

How can rising inequality be a bad thing, unless (wealth) inequality in itself is also a bad thing?


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I have no idea how you can get from taxes to "protestant christian morality"?

Your comment also seems entirely jingoistic when read in the context of what it's trying to reply to. What does "controlling it all" even mean? How should people "play by the rules with integrety[sic]", when you're apparently arguing against any such rules?


"Fairness alone does not guarantee a society where the outcome for the unwealthy is tolerable"

I'd be really interested in an example of where this is the case. Personally, I can't conceive of a situation where, in a perfectly fair system, the man with the most money is utterly intolerable. Such a system naturally creates the inference that the man did something as an individual to acquire that wealth (and not necessarily in a zero sum manner).

As pointed out in the article, the issue with rising inequality is not that the wealthy are getting wealthier necessarily, only that it comes at the expense of people who work just as hard or harder, but still struggle to get by from day to day. Since the perception is that more work leads to more reward in a fair system, the perception is also that this situation is unfair.

Economic equality, however, is not necessary for such a situation to be fair. Flipped around, if the manual labourer who toils hard every day were paid more than the non-executive board member the situation would be perceived as fair, despite the fact that the two individuals would receive different compensation.

I really can't see the difference between "fair" and "unequal" being a matter of "semantic quibbling".


> Personally, I can't conceive of a situation where, in a perfectly fair system, the man with the most money is utterly intolerable.

I'm not sure how this is a response to what I wrote. I'm talking about the tolerability of outcomes for the UNwealthy, while you're talking about a rich person being intolerable?

The semantic quibbling I'm referring to is the idea that when someone like Bernie Sanders rails about "economic inequality", they are implicitly advocating economic equality (which is incorrect, as I've stated in my original comment), and bouncing off that to present "fairness" as the real thing at issue.


I've never thought of "equality" as having identical sized piles of money, and I don't know anyone else who does, nor have I read anyone proposing such a thing, after a very modest amount of study in economics and inequality the US.

The main goal in my mind is equal opportunity, not equal wealth. Equal opportunity may require a minimum amount of wealth, but need not limit the maximum nor require that people have similar amounts.


As an addendum, equal opportunity is necessary, but not sufficient for a just outcome (at least, according to what most reasonable people would agree to be just).

You could have a theoretical society where everybody is taxed 10% of their income and that income is given to a randomly selected person each year. This society has absolutely equal opportunity, but it's also pretty unjust, because why should that one person suddenly be rich?

Keep that in mind when discussing (more) equal outcomes vs. equal opportunity. Equal opportunity is insufficient.


How do you define ‘just’? How can equal outcomes ever be attained? I played a lot of baseball, but there are only so many slots on the Yankees.


GP's lottery example was meant to show that even if equal opportunity is achieved, it's entirely possible to decouple compensation from work.

One example of a proposed solution is a limit on the difference between the lowest and highest salaries in a company.


By some random chance, that much like any form of luck, is well understood by most people.

What value is this proposed solution and how is it ‘just’. Sounds a lot like people don’t understand the lessons of capping salespeople’s commissions.


Sales commissions are an interesting example. A hard cap can probably have bad psychological effects. But squeezing commissions down overall (by reducing the percentages or some other approach) is unlikely to have the same bad effect.


You know, all of your solutions try very heavily to discourage people for actually doing things. Forcing equality of outcome seems to require punishment for any hard work. I would rather not live in the world of Harrison Bergeron.


Where do you get the "very heavily" from? I think you're imagining things that aren't there.

Apart from that, you may be suffering from Status Quo Bias.


"squeezing commissions down overall" is very heavily discouraging people, ask IBM.

Nope, "equality of opportunity" is a great thing. I just don't believe "equality of outcome" is achievable and further believe it is detrimental to society as a whole. We should teach our children not to envy and working hard is a component but not a guarantee of success.


>The main goal in my mind is equal opportunity, not equal wealth.

There are a significant number of people who want to go beyond equality of opportunity. Look at the hiring programs of Google, etc. that attempt to hire larger ratios of minorities than the ratios graduating from CS programs.


I would understand this type of affirmative action as an attempt to provide equal opportunity by correcting for the existing inequality of opportunity. The ratios graduating are disproportionate to the general population ratio, and may be a sign of a perceived lack of opportunity. There are advantages to a diverse workplace too, so opportunity aside there are good reasons to prefer diversity over the ratios coming out of school.


Not all jobs at Google require a CS degree.


"identical sized piles of money" is a strawman, but lots of people support, and would like more of, tax-financed income transfers and high quality public services to reduce economic inequality.


> "identical sized piles of money" is a strawman

No it's not. The entire premise of this article is that equal sized piles of money is not what people want - the presumption is that equality means equal wealth. He went through multiple specific examples using toys, cookies, grapes, and money, explicitly. When the title said "People Don't Actually Want Equality, They Want Fairness", the definition he's using there for "equality" is equal sized piles of money.


Yes it's the premise of the article, but I still think it's a strawman.

You can have more or less equality, and equality increasing measures are fairly popular.


Ah, okay, yes then I agree with you. Sorry for assuming you were talking about me. I also agree with the article that people want fairness more than literal equality, but my reaction is that literal equality is more than just strawman, it's an odd premise to start from. I'm sure there are some people who do propose literal equality, but I don't think that the general argument against inequality is one in favor of literal equality, by and large.

My takeaway from my experiences reading and talking about this is that when people talk about equality, they are talking about equality of opportunity. The idea being that things would be better if everyone had a basic level of needs covered, things like food, shelter, education and health care.

It is possible to be in favor of equality increasing measures and still not have the long term goal of equal sized piles of money. What we have right now is both really unfair and really unequal. And it's getting worse, not better. So equality metrics may be the simplest way to measure whether things are improving (they're not). That doesn't automatically mean that getting everyone to balance out is the ideal, right? Perhaps it's a blunt metric precisely because anything else is more subtle and leads to nuanced debate that most people won't bother with?


I know quite a few who think equal should mean exactly equal. These are the same individuals who hyper focus on metics which solely measure outcome.


Just curious, but do these people agree and say explicitly they want exactly equal, or is that what the goal seems to be based on metrics that solely measure outcome?

I don't doubt that such people exist, but I think that metrics which measure outcome don't necessarily implicate literal equality. Outcomes are just the simplest, most accessible way to highlight the (real) problem. But like affirmative action, outcomes as a metric make sense at times of great inequality, and they won't make sense if/when we are nearer to either exact equality or to equality of opportunity.

Right now, we are losing ground with equality, not getting closer to it, and that's why (in my mind) outcomes are an acceptable way to look at it for the time being. I think looking solely at outcomes would become wholly inappropriate if/when equality policy started holding people back from getting any more than someone else regardless of the quality or amount of their efforts.

Some people on the extreme ends of the political spectrum, and some very wealthy people, do try to argue that taxes and other policy are holding them back now, but I don't even want to broach that. Right now we do have a few extremely rich people, and a lot of extremely poor people, and the gap is growing. Until that gap is shrinking and closer to what it used to be, it does make sense to me to use outcome as a metric.


It’s a pretty simple concept, people don’t like getting screwed by someone else, and equality of outcome is impossible. Frankly, most people don’t give a damn how much some actor / CEO / athlete makes if they can pay all their monthly bills and have some money to enjoy themselves. Envy really isn’t in the national character until our lives are sucking.


> if they can pay all their monthly bills and have some money to enjoy themselves. Envy really isn’t in the national character until our lives are sucking.

I know a few people that cry poor despite the fact they own a horse, or paid $2,000+ for a child's cubby house, or own a quad bike, or own a jetski.

Low level envy, or "keeping up with the Jones'", is raising the level of what people feel entitled to as basics for "enjoying themselves".


Those people have some mental problem. Anytime you combine busybodies with envy you get a bad combination. Not to be confused with people who just suck at managing their own finances because that is a whole different problem.


Interesting article, and Frankfurt's On Equality is on the reading list. I enjoyed On Bullshit after I got through the first section. Certainly in 'water cooler conversations' the feeling that someone else has got a promotion or higher salary without (visible) extra work is deeply resented, even though it has no direct effect on the participants.

What I'm finding in UK at the moment is the lack of a linear response in terms of quality of life to income level. There is a definite 'knee' or threshold. Below that income you have problems, above that income things get easier quickly.

As usual here, my impression is that it comes down to housing costs: we don't have rented accommodation that is small and cheap any more. You can't find somewhere 20% or 30% cheaper below a certain rent level. Not sure if that is the whole story but I think it is a factor.


>>As usual here, my impression is that it comes down to housing costs: we don't have rented accommodation that is small and cheap any more

You can, it's always a question of how much you want to sacrifice for it. A friend of mine is renting a room in a 5-bedroom house for 350/month, all bills and council tax included. I pay about 950/month for a 3-bedroom house with a double driveway and a garden. To me, the reduction of utility is not worth the 600/month saving, but it's absolutely not a problem to find a house to rent for 500-600/month, you just have to move further away from the city.

(unless, of course, you are talking about London - then this entire conversation falls apart)


that works for people living on their own, but people with families/children can't live in a room in a 5 bedroom house for 350/month. You also presumably can't go any lower than 350/month (which is the 20-30% cutoff the parent mentioned) - 300 quid a month might be nothing to someone who can afford a grand a month, but to someone whose income is 6-7 hundred a month, it's a massive chunk.

There are also costs associated with living outside of a city. If I live 5 miles out of a city, and work in a city, I have to travel there and back every day. Depending on where you live, this can be very cheap or very expensive. Public transport as a method of commuting is also not suitable for many people (in particular the people who would be affected by low wages who work awkward shifts). The alternative I assume is car ownership, which is definitely not cheap, and if you are driving into a city is probably going to cost you more in parking than you'll save in rent.


but people with families/children can't live in a room in a 5 bedroom house for 350/month

You can, and people do all the time. People live in slums with 7 kids in a corrugated sheet metal shack the size of a garden shed with sewage flowing past their front door.

So then, what is the difference with a country like England? People are not allowed to live in such conditions. This is not the same thing as can't. We set minimum standards of living because we don't like the idea of people living in squalor. We rarely give a thought to the adverse consequences of such policies. A family that might have been able to afford a tiny apartment is instead forced into the street to fend for themselves.


I'm not advocating a return to conditions that I have a dim recollection of (I am just old enough to remember my parents having an inside toilet fitted and Jack Frost on the windows looked lovely to the 7 year old me but the 60 year old me really likes his central heating thankyouverymuch). However, I think there is a case for some careful relaxation on what kind of buildings can be used for housing. Still regulations, but allowing (say) bedsits for single people &c

No return to slum landlords, they weren't cheap mind you but often very expensive.


> Certainly in 'water cooler conversations' the feeling that someone else has got a promotion or higher salary without (visible) extra work is deeply resented, even though it has no direct effect on the participants.

This indirectly affects the participants by decoupling the work they do from the compensation they receive.


Since current systems do not provide anything resembling equality of opportunity and fairness a lot of the narrative is made up and propaganda. We must recognize the system for what it is and not what it claims to be.

Children brought up in less privileged environments cannot compete with those born in privilege. Cherry picking exceptions by those in privilege to make a point is extraordinarily exploitative and self serving.

Because exceptions usually cannot see any truth beyond their exceptionalism as a core value their narrative is often self-grandiose and are ripe picking for entrenched interests to pass off exception as rule.

Just like blacks who did not have rights till 1965 and land and thus no opportunity to truly build generations of wealth cannot be expected to compete with their white counterparts who have had generations of wealth creating background. If you then claim wealth is not important for equal outcomes then the logical response is let's take it away.

The ones lecturing loudest about equality are those who start a 100m race at 90m. For the privileged the world always seems fair. And others simply do not recognize all the things that had to come together to get them where they are.

The elephant in the room is inheritance. And I am certain all the loud uncompromising advocates for the 'best should win' would not mind a systemic reset for children every generation so the truly best ones can shine irrespective of background, but of course not. We have never seen any initiative to make this so. This is the nod nod wink wink part of capitalism. We all allow and gloss over these cracks in our worldview.


If people respect pay for work, then they despise the opposite, including wealth earning income for no work. That saidd...

This is consistent with believing owning less wealth is better than owning more wealth. Then that justifies groups with less wealth as better than groups with more wealth because they earn less income without work. Which then means the gender gap, racial gap, poor social immobility, etc are thus preferable because they imply not getting as much undeserved income. Only the belief that income without work is a priori bad forces this conclusion. The idea "compensating individuals honestly for their work produces a sufficiently fair world" isn't consistent with wanting to produce a fairer world. [0]

[0] http://mattbruenig.com/2017/07/22/some-opponents-of-ubi-nece...


> If people respect pay for work, then they despise the opposite, including wealth earning income for no work.

That logic doesn’t follow. Respecting something doesn’t always require despising it’s opposite. Plenty of hard workers hope for wealth earning with no work for themselves, check the local lottery.


I apologise that despise was a little harsh for what I was hurriedly trying to say but the very uncompressed idea is that IF the belief "a man's hard work alone determines my respect of them" is a fairly common justification of income from work AND income without work exists THEN people earning income without work goes very much against that belief that only hard work earns approval. The 'respect' part was intended to mean 'respect exclusively' like as might be exemplified in the particularly intense conviction some might have against 'lazy poor people living handouts', as well as the rich living off of capital gains. This black-and-white perspective belongs a fairly vocal minority.

Although people who sanctify work do elevate it to a question of toil, why wouldn't gambling (of any kind) just be a really expensive (albeit fairly toil-free) side-gig? No matter how different their hopes are from what is statistically likely, nor compelling the possibility that the lottery ticket could actually be a kind of masquerading windfall, the thinking isn't "this is my investment vehicle" but more "if I 'try hard enough' [by buying enough to win] I will eventually succeed."


A contrary Idea:

People need society to be unfair, not to blame thenselves for their lack of success.

Especially in times of self-exploitation (or optimization) I find it an interesting perspective.


"I used to think it was awful that life was so unfair. Then I thought, 'wouldn't it be much worse if life were fair, and all the terrible things that happen to us come because we actually deserve them?' So now I take great comfort in the general hostility and unfairness of the universe."

-Marcus Cole, Babylon 5


Well, free will is an illusion and the world is pretty much deterministic on the large scale, so the concept of "deserving something" would itself not be fair to begin with.


But the illusion is trong enough and you could just reframe this problem avoiding the free-will problematic.

Someone who puts all his energy in to getting somewhere should be able to get there (within the reasonable). No matter the underlying origin of his motives or circumstances.

I still see your point though, but I'd say that's a further step: to acknowledge that nobody should be held responsible for himself. (EU-law is a bit further here than the US though, no retaliation by law like the death penalty)


Carlson: No... it didn't. It's not fair! It's not fair! Sheridan: (knocks Carlson out) What can I say? Life's tough sometimes.

P.S. in an earlier comment you asked for a link and my profile provides it.


> People need society to be unfair, not to blame thenselves for their lack of success.

Yes, because everyone has equal capability to be successful. Of course, it's everyone's fault for the situation they were born into or with!


Something that came to mind in this article is that when children were concerned with fair distribution, it was with regard to two other people. When younger children were shown to be more willing to give themselves more while others got less, it was with regards to themselves. Makes me wonder how much self involvement affects these types of attitudes. It wouldn't be surprising, to me, if people are generally satisfied with inequality when they themselves are the ones with more.


In Australia this concept is widely recognised as 'fair go'.


Well, in most cases those two simply cannot be separated though. If you have a hugely influential elite class they'll naturally skew the fairness of the society so that they keep their benefits the most.



Monkeys want fairness too - I stuck up an amusing edit of Frans de Waal demoing that which got 400k views to my surprise https://www.youtube.com/watch?v=-dMoK48QGL8


With all the discussion of meritocracy and how it doesn't actually exist, at most I can believe some people want fairness.


If you value equality for its own sake, you're likely a computer scientist or mathematician.


Fairness is super subjective, so in reality people just want preferential treatment.


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>built into the evangelical left's religion

Sounds a bit straw man to me. Are there any actual human beings that have that position?


They don't want fairness either, they want "fairness".

The difference between fairness and "fairness" is that "fairness" works out a little better for people like yourself than fairness does.


> "fairness" works out a little better for people like yourself than fairness does.

Because the CEO of a company fairly worked 100-300 times harder than the person on the packing line?


Maybe gp worked really hard on that comment; should you really criticize it?




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