The real issue is that the fundamental structure of our economy aggregates wealth towards the top. Employees who add millions of dollars in value per year to a company get paid a fraction of that. Look at per-emoloyee profits for all of the major corporations. Our economy very heavily favors people who own capital over people who do work on the ground floor.
If you want to fix income inequality, you have to look at structures like the stock market, like corporate equity distribution, and pretty much everything we have in place in society that allows the rich to increase their wealth without actually working.
Increasing taxes is like taking aspirin to cure Ebola. Sure, you feel better, but it's not going to make you healthy.
The earth has finite resources. Wealth is a zero sum game. Even if you want to look at things like entertainment that can be reporduced cheaply, musicians and directors need fed, food is limited, therefore even films/music are limited.
That's clearly not the case. The classic example is building a house alone in the woods, but let's consider art. With different choices, a person could use the same paint to make a good or a bad painting. The choices made while painting decide if it will be a mess or something beautiful. Even if it's never shown or sold to anyone else, the person who made a beautiful painting would be wealthier for it.
Much of what's seen as wealth production is instead liquidity production -- turning natural capital into financial currency. In the case of any production chain founded on fossil-fuel energy, the transformation requires a draw-down of natural capital worth many millions of times the market-price and wealth "created".
Activities founded on renewable or sustainable processes are less fraught, but there's still the accounting for potential disruption or reduction: soil loss (rougly 100x the rate of creation), sink-exhaustion (waste and pollution factors), biodiversity loss (rates of extinction > speciation), and the like.
There's little accounting for any of this within conventional economic theory. Ecological, biophysical, and thermoeconomics address parts. Steve Keen is starting to write mathematical descriptions of production factors in which the role of energy is taken into account.
Given various inefficiencies of educational institutions, this is all but certain to be occurring as we speak. There is a notion of a "forgetting curve".
And, as you note, information can at best asymptotically achieve some maximum theoretical efficiency. It's not a limitless fount of potential.
What happened in the meantime? We live in the most abundant age in history. Worldwide poverty is at an all-time low. Surely wealth is growing in absolute terms and it's not just the top 1% benefiting.
Their offspring could benefit from a generous endowment of a proportion of this wealth, say 10%-20%.
Edit: and no sneaking about with Trusts, either.
A tax on people that eat their brocoli would be highly impractical!
There are some definite difficulties in implementation. But even then, my argument is that it could be a really harmful tax if it could be applied at all.
One would have to balance the "harm" caused to the children of wealthy people for not inheriting wealth (mostly when they are around 50-60 yr old themselves), with the harm caused to society at large.
> One would have to balance the "harm" caused to the children of wealthy people for not inheriting wealth (mostly when they are around 50-60 yr old themselves), with the harm caused to society at large.
I wonder if we could think of other examples of how harming a minority of people can be good for society at large. But regardless of the moral standpoint of the remark you said, you also have to account the harm it does to society to make people spend extra time hiding their wealth and spending it more frivolously.
Many people spend inherited wealth frivolously. Business acumen isn't known to be genetically determined, whereas political influence is certainly affected by wealth and pedigree, see George Bush the first and the second.
There is harm to the donor to abolishing inheritance. I don't want to live in a world where "I farm this land, just as my father, his father, and his father for 5 generations has done." is not possible.
>I don't want to live in a world where "I farm this land, just as my father, his father, and his father for 5 generations has done." is not possible.
Why not? A man works hard to support himself but allowing four generations of free-riders seems like a pretty bad idea. It strikes me as a sort of neo-monarchism. In the past we had royalty blessed by god and passed through blood and now we have the economic elite blessed by capital and passed through blood.
If you could effectively put 100% tax on inheritance(which you can't in practice), it means your utility of leaving wealth around becomes 0. Now you want to spend that wealth as much as possible, and it turns into consumption. You would sell and spend everything you have for lavish expenses, which means a reduction in capital investment, which means slower economic growth.
I doubt hedonist consumption is what Keynes had in mind.
> inheritance taxes are necessary to provide equality of opportunity.
Lets take this to the extreme: lets say that your father could not provide you with anything but minimum substance until your coming of age (18?). Anything given to you by your parents would be taxed away. This means that you now cannot go to any college that is not provided to you by credit. But you have no assets and no income, so nobody will loan you any money. Plus, you don't have money for rent, so you need to work immediately to pay for your own place.
Maybe you feel sympathy for the millions of people that actually live that, but how is forcing everyone to go through that be better for society at large?
Or think what it would mean for the state to actually do that: what if you had to build any infrastructure built by a previous generation from scratch, because "its not fair the SF bridge is nicer than the Brookly bridge, its inherited".
The emotional answer I have against advocating inheritance tax is that the goal is not to be fair, its to be better. And certainly fair by destruction, by removing everything, is not better.
Parent poster proposed a way to help workers by changing the incentives in the system to reinvest more into productivity/research, without throwing out the system that has made our society propsperous.
Providing for a living working wage. Providing for labour unionisation or equivalent functions. Curtailing the capability of the wealthy to seek self-serving concessions from legislatures. Supporting a vibrant programme of public schools and works.
Pretty much Adam Smith's prescription in 1776.
Also by classical economics, you cant afford to give less than living wage because then you would kill the people that work for it.
As soon as land becomes private property, the landlord demands a share of almost all the produce which7 the labourer can either raise, or collect from it. His rent makes the first deduction from the produce of the labour which is employed upon land....*
[I]n every part of Europe, twenty workmen serve under a master for one that is independent; and the wages of labour are everywhere understood to be, what they usually are, when the labourer is one person, and the owner of the stock which employs him another....The workmen desire to get as much, the masters to give as little as possible. The former are disposed to combine in order to raise, the latter in order to lower the wages of labour.
It is not, however, difficult to foresee which of the two parties must ... have the advantage in the dispute, and force the other into a compliance with their terms. The masters, being fewer in number, can combine much more easily; and the law, besides, authorizes, or at least does not prohibit their combinations, while it prohibits those of the workmen. We have no acts of parliament against combining to lower the price of work; but many against combining to raise it. In all such disputes the masters can hold out much longer.
We rarely hear ... of the combinations of masters, though frequently of those of workmen. But whoever imagines ... that masters rarely combine, is as ignorant of the world as of the subject. Masters are always and everywhere in a sort of tacit, but constant and uniform combination, not to raise the wages of labour above their actual rate. To violate this combination is everywhere a most unpopular action, and a sort of reproach to a master among his neighbours and equals. We seldom, indeed, hear of this combination, because it is the usual, and one may say, the natural state of things, which nobody ever hears of.
Masters, too, sometimes enter into particular combinations to sink the wages of labour even below this rate. These are always conducted with the utmost silence and secrecy, till the moment of execution, and when the workmen yield, as they sometimes do, without resistance, though severely felt by them, they are never heard of by other people. Such combinations, however, are frequently resisted by a contrary defensive combination of the workmen ... But whether their combinations be offensive or defensive, they are always abundantly heard of. In order to bring the point to a speedy decision, they have always recourse to the loudest clamour, and sometimes to the most shocking violence and outrage. They are desperate, and act with the folly and extravagance of desperate men, who must either starve, or frighten their masters into an immediate compliance with their demands. The masters upon these occasions are just as clamorous upon the other side, and never cease to call aloud for the assistance of the civil magistrate, and the rigorous execution of those laws which have been enacted with so much severity against the combinations of servants, labourers, and journeymen....
A man must always live by his work, and his wages must at least be sufficient to maintain him. They must even upon most occasions be somewhat more; otherwise it would be impossible for him to bring up a family, and the race of such workmen could not last beyond the first generation.
https://en.m.wikisource.org/wiki/The_Wealth_of_Nations/Book_...
That the employers monopolize and combine and have advantages over the worker is established, but not that doing the same on the other side would be beneficial. He mentions in spirit on in parallel that any measure to try to reduce that power of monopolization would be either ineffectual or make it worse.
Within the Smithy naivete, one could argue that unionization would mean that by necessity, employers would be require to conspire to be able to deal with unions. Of course, I don't think he had the word for union, certainly not the concept we have today, but he clearly condemns how employers are also able to use force against the gathering of workers.
But he explains the advantage, the unfairness of circumstance, of law, of practice, and of effect.
Elsewhere he's far more direct in challenging economic power.
And if you read the followers of Smith, particularly Mill, that endorsement is far clearer still.
So long as there's a surplus population, employers will not want for labour.
But China is a very extreme case: in general, if you dont have enough money to support a family, you wouldnt have a family, and lower wages would affect the demographic growth of the lowest earning members of society. The logical corollary for this is that you always will have people in the lowest earning spectrum, because if they earned more they would have more children, increase surplus and reduce wages. We don't have a reserve army concept yet at WoN, unfortunately.
(btw Marx seems to agree 100% with this concept of lowest earning spectrum/demographics)
In 1672, the English East India Company finally secured a trading post in Taiwan - ten years after the Dutch East India Company had been expelled from the island by the Chinese. The Company was soon engaged in direct and regular trade with the Chinese from that base and was permitted to make regular voyages to Amoy, Chusan and Canton. By the turn of the century, the Company's base for the China trade was transferred from Taiwan to its "factory" at Canton. With its Royal Charter, the Company was granted the privilege of monopoly of trade in the East Indies until 1833.
From 1700 onwards, most foreign traders were confined in Canton, where rigid restrictions were imposed through the practice of Co-hong, a guild of Chinese merchants, the sole recognized agency between foreign and Chinese merchants.
http://www.bl.uk/reshelp/findhelpregion/asia/china/guidesour...
You can also find David Ricardo and Malthus in agreement on wages. Ricardo gives us the subsistence theory of wages (I associate this as the Iron Law of Wages though that may be incorrect ... ah, J.K. Galbraith, whom I've read, makes that attribution):
Nice exchange of messages! Glad to be able to talk about things written 250 years ago with random internet strangers.
That said, on wages, I get the impression he's not all that far from Smith.
And likewise, appreciate the discussion.
In other words, nothing like that.
Why? Why is that the magic number that is insane??
When I worked at a hardware store we had a brochure we could order in a gold-plated Ducane grill for $4 million.
That recent graph showing the top 1% having a 6% wealth growth rate is wholly unsustainable for any society. So there's something to be said for trying to level it off.
If the wealth continues the trend to concentrate at the top then there will be an increasingly large and unhappy group of people who will elect increasingly non-mainstream politicians who promise to help them, eventually leading to who knows what kind of unpleasantries for all.
100%. Nobody has a Scrooge McDuck cash vault. Bank deposits are also spent, in the form of depositor's money being loaned out by the bank.
Obviously the classic depositing/loaning service of banks is essential for progress. But hundreds of billions of those deposits are going to making the rich richer. It would be nice if we could come up with a way to provide capital to people who need it while also maintaining a strong middle class. I don't know how to do this but it's worth talking about.
What I really want to know is how much of people's savings (passively invested in banks and things like index funds) is going to fund things like the new Facebook vs. how much is not really doing that much.
People tend to invest in things with a high rate of return. That high rate signals it is doing things that people want done and are willing to pay for. I.e. it helps society.
> a way to provide capital to people who need it
That's exactly what banks do. My bank branch is plastered with posters trying to sell a loan to everyone who walks in.
> passively invested in banks and things like index funds
If you're arguing those are not productive investments, I don't think that's very defensible.
> how much is not really doing that much.
If you're arguing that rich people tend to invest in low performing investments, that doesn't make much pragmatic sense. People get rich by investing in highly performing investments, not dogs.
Banks want people to take out loans because they collect fees and offload the risk via MBS. They give people loans who can't afford them and that's not good for anyone, but then they know they'll get bailed out again if something goes south. None of this is sustainable, healthy, or productive.
That's not a good argument for raising taxes, though.
Apple got initial funding of only 250k, and that was split between equity and loan, very feasible even with a 400k yearly cap. (And I'd also note that 10% of "any money over that" still adds up given some of the salaries paid to top execs)
Secondly, Google's initial funding was only 100k in 98` dollars. The significant 25m round was from kleiner perkins and sequoia, and I certainly imagine that corporate funds for investment would not be held to the same limits as personal income tax.
Finally, facebook was bootstrapped out of their own pocket until they got a 500k invesmtent from thiel in 04 $'s. Once again the "big" investment a year later came from a firm.
In all of these cases the initial seed/bootstrapping money would come FAR under the 400k limit expressed, adjusted for inflation, and that assumes people wouldn't both save over multiple years, or that we wouldn't see more reliance on companies rather than individuals in early stage investment if the tax code shifted such that it was more advantageous.
I defend this largely because in my own readings of history I've attributed a large amount of the current economic state to events of the late 70's and 80s, the tax code changes being a major one of them, and I think your points unfairly detract from the validity of reintroducing such tax structures.
I'd note however that my original point was to emphasize the smallness of most of the initial investments. One does not need to be a billion dollar entity to have enough diversification in high risk investments to make it a worthwhile component of your portfolio.
(I'd also defend America's ingenuity prior to the advent of VC; we were a pioneer in the sciences and technology long before venture capital was a thing. This is an entirely separate discussion about the viability of various forms of tech. growth stimulus that I'm neither qualified nor desirous to have, but I mention it to suggest that if we've found success in other systems before, there may be reason to experiment further when we observe a clearly deleterious trend in the current state.)
The point is incentives. People doing work and providing value is a good thing that we don't want to discourage.
There is zero point in doing extra work if it will be taxed at 90%. People would just work for half a year, then take the rest off.
It's actually quite terrifying that people would advocate for taking up to 90% of someone's income. We need to work on solving inequality but this simply isn't the answer.
Edit: It's also important to remember that taking more money away from the rich, and feeding it into an already broken and inefficient system (our government) does not equate to lifting people out of poverty.
Interestingly, the top U.S. tax rate from 1951–1963 was >90%, and it was >50% during the half-century from 1932–1986 – https://en.wikipedia.org/wiki/Income_tax_in_the_United_State...
This is another variation on the "rich people hoard cash" theory, which is completely false. Rich people invest all of their money back into the economy. Even bank deposits are invested back into the economy (when the bank loans it out).
Scrooge McDuck cash vaults do not exist.
So, they do circulate through the broader economy. There's no silo of cash sitting somewhere paying dividends.
"investing" != "giving it out". "growing economy" != "less inequality".
The reason Apple, etc., invest a lot of their cash overseas is not because those are better investments, but because the US corporate taxes are so much higher those foreign investments become more attractive.
Level the taxes, and the money will be reinvested back in the US.
To know what they are investing in, consult the Apple Annual Report, which says. Even if the balance sheet says "cash", what they mean is "bank deposits". Bank deposits get loaned out to others, and those others spend it.
Nobody borrows money in order to hoard a pile of currency.
Of course it is. What do you think those funds invest in? Piles of cash?
> Bank lending is driven by demand, not deposits.
If that were true, banks wouldn't need deposits and certainly wouldn't offer free checking. They're not charities.
> If that were true, banks wouldn't need deposits
That doesn't follow from what I said. Banks are required by law to back their loans up with reserves. So when they don't have enough reserves, they borrow on the interbank lending market or from the central bank.
http://www.bankofengland.co.uk/publications/Documents/quarte...
HF traders don't hold for long, so why are they equivalent?
Of course it is. Buying a piece of a company is investing in it.
> Buy that logic, high-frequency traders are investing in the economy.
And they are - even if they hold a particular stock for a millisecond. The aggregate invested across the market is what matters.
It's a bit like calculus. All those infinitesimal bits add up to real amounts.
> That doesn't follow from what I said.
Maybe you can explain why banks offer free checking.
The original comment was implying that rich people contribute to the economy by investing their spare savings back into it. I'm not claiming that there's no benefit to buying secondary stocks and derivatives on them, just that this is not even remotely the same in terms of creating economic growth as actually investing in creating new business opportunities and such. It's kind of like saying that trust fund kids who don't work contribute to the economy by spending money. And often this "investment" in the stock market is the mere fueling of bubbles.
Money in bank accounts is loaned to others and "thrust back" into the economy.
Money in other investments (stocks, bonds) also funds economic activity.
Your argument only makes sense if the wealthy are hoarding cash under their mattresses, which is not what they do.
I would be quite happy to earn more, and then 400K a year, as you say, even if he was taxed at 90%.
- Work for MEGACORP and produce $400k/year of value
- Develop a new business which has a 30% chance of succeeding. If it succeeds, you estimate it will be worth $50M.
Suppose the marginal tax rate for income above $400k/year is 40%, and you want to maximize your expected earnings (say, to donate to a charity you think is particularly effective). Which option is rational?
Now suppose the marginal tax rate for income above $400k/year is 100%. Now no matter how high we change that $50M number to be, it's always better to just work for $MEGACORP, because you get a guaranteed paycheck.
This is known as a distortion, and is the true cost of taxes. I personally don't care too much where the wealth people creates goes, and I'd like to see less income inequality - but let's not kill the golden goose while we're at it. There are far less distortionary taxes than extremely high income tax rates.
In real life, if I'm taking home $400k/year in salary it's because I'm creating $1 million/year in revenue. Also in real life, a start-up business that will be worth $50 million usually has more like a 1% chance of success, so it's expected value is actually just about 25% more than the proposed salaried job -- less than my value-per-year at my job, actually.
Finally, in real life, most people don't want to maximize expected income -- its buying power in terms of personal needs decreases logarithmically.
Tax law really has little effect once we use a less imaginative scenario.
You mention people are risk averse (logarithmic utility of money). I posit that that is only true for non-altruists. An altruist prefers to save 10000 lives nearly exactly 10 times as much as they prefer to save 1000 lives. Given a secure enough financial base off of which the logarithmic personal rewards factor is a non-issue, this is the primary driver for plenty of people that I personally know.
You seem to be assuming that Starting a Business is always better, more of an achievement, more awesome, than not starting one. I see no reason for this to be true. Maximizing revenue tends to have more to do with building market power than with achieving anything at all.
You're also deliberately shifting the goalposts here. You started out by saying that progressive taxes were bad because they penalize making more money. Now you're saying they're bad because they incentivize complacency and mediocrity, which are life-achievement qualities rather than economic quantities.
It looks like your underlying belief is: "people who make lots of money are heroes, and we need to encourage more people to be heroes, irrespective of what's good for the rest of society."
>Given a secure enough financial base off of which the logarithmic personal rewards factor is a non-issue, this is the primary driver for plenty of people that I personally know.
To be frank, it's their primary excuse for what they really wanted to do, which was to make as much money as possible. After all, how many are giving away their extra money to the most efficient administrator of human-welfare programs around, the state?
This is a major misconception I see on both sides of the argument, (but definitely more of an issue on the "rah rah Laissez-faire crowd") the worry isn't really about the "1%" who are doctors and engineers who make ~$250K/year after working hard, the worry is really the people who make 20 million dollars a year with nowhere near a proportional value add.
By eliminating the tax shelters and correspondingly lowering the tax rates, Reagan brought about much more efficient allocation of investment capital.
Perhaps say the severing of our money from gold maybe?
Look it's rather simple. You can wax and wane about tax policy until you are blue in the face. The answer lies in the currency, not taxation.
I give this example every single time these stories surface.
Take a pre-1965 quarter when our money still was constitutional and made with silver. 6.25 grams of silver in that quarter. That silver content has a melt value today, right now, of $3.37.
Items that silver quarter can buy today:
A gallon and a half of gas = .25 cents
1 gallon of milk = .25 cents
1 loaf of bread = .25 cents
The point illustrated is, the problem is your currency is worthless, it has been devalued by the banking cartel of the federal reserve to the point of almost complete worthlessness. And every year prices go up it's your currency losing more value, more purchasing power. It's not rocket science. You have been robbed by bankers. They own you. Washington and company learned their lesson after the continental dollar. Fiat currencies are fraud, and worthless. They always have been and always will be. Our dollar is no different. That's why the constitution has as the supreme law of the land that our currency must be backed by gold or silver. Which can't ever be valued at zero. Because it has intrinsic value. Fiat currency always throughout history, always, hits zero.
So I just assume it's Wall Street vampires down voting or those who hear the word constitution and down vote because clearly that makes me wrong or insane.
1. We want slight 1%-2% inflation to prevent hoarding from slowing the economy to a crawl. Why invest or buy something today when the cash stuffed in my mattress will buy something better in 6 months.
2. If you agree with the first statement, why tie the rate of growth of money to how fast you can dig a metal out of the ground? Let "experts" survey the economy and decide how much more money there should be this year as opposed to last year.
I am not saying I agree completely with either statement, but that is one argument against a gold tied currency.
The gold-backing was dead by 1970. Petro-dolarisation occurred in 1974. The UK all but went broke in 1979. The USSR did go broke in 1987-89, courtesy the US and Saudi Arabia (something Putin may well have in mind now).
Money is weird. And the gold standard and "end the Fed" nonsense is ... complete bullshit.
This is only true if wages don't go up to match it, and if they don't, then we should be asking why not. People should be insisting on raises at least in line with inflation, and if they're not able to get even that, then it suggests a power imbalance.
And besides, currency devaluation isn't some secret conspiracy, or even an inherent property of fiat currency, it's the explicit and stated aim of our monetary policy. Most economists seem to believe a constant low level of inflation is a good thing and so that's what we do. If you disagree, you should argue with that directly. And if you want a stable currency value, I would suggest monetary policy would be far more effective at achieving that than the gold standard.
To be blunt, that really is SV cuckoo-land thinking.
In 22 years of employment, 18 in IT with Fortune 100s, I have never had a job in which that was possible.
Why would a company voluntarily increase its personnel costs by the rate of inflation?
Because you have a society where not doing so would be rightly recognised as a defacto wage cut, and considered outrageous by your employees. This is generally the case in Europe, and I'm arguing that this not being the case in the US is exactly the problem.
Also FWIW, I don't think tech companies are remotely representative. It's an industry with high employee turnover, and where people are expected to argue for their own raises.
Nonetheless, I work in tech, and I got an inflation based salary bump last year, which was applied in addition to a performance based raise, and I'm expecting one this year as well. But then, I don't work in the US.
You know, because you actually fought for your interests instead of accepting your lot as a constantly-devalued cost center.
Let's say that on Jan 1, 1970, you took your pre-1964 quarter and pulled out the 6.25 grams of silver in at the price of $12.37 a troy ounce. You'd get $2.48.
If you put that $2.48 in a money market earning just half the fed discount rate for the last 47 years, it'd be worth $7.99 today. The silver would be worth $3.37. (The currency would likely be a lot more that $7.99, because the difference between money market rates and fed discount rate historically hasn't been as high as the very conservative 50% markdown I used here.)
There are a lot of moving parts in an economy that affect cost of living. A lot of stuff has changed since 1970 beyond going off the gold standard. Massive productivity changes, energy and raw material price shocks, demographic changes, policies and laws changing behaviors all across the individual and business landscape. It's difficult to isolate one individual factor as the sole cause.
- slavery
- the civil war
- the industrial revolution
- two world wars
- huge growth in population and in the economy, which makes it inherently less volatile
- a bunch of other important events that would obviously affect currency prices
(sometime WolframAlpha doesn't display the chart you might need to reload the page until it does, then click on the button that say "Linear scale" to display in a linear scale instead of a log scale)
If I instead look at the log graph, it looks more like the value of currency was approximately stable before 1900, and then started to trend upwards some time after that. I'm not sure how to interpret that, but if you were intending to point to the end of the gold standard, this data doesn't really support that. There is a slight surge around 1970, but only relative to a general trend.
And when I look at the average rate of inflation from 1970 to 2017, it is 4.01% per year: http://www.wolframalpha.com/input/?i=1000+1970+dollars+in+20...
Both of them are exponential growths, but with quite different rates.
As I said, there was a surge around 1970, so yes, if you take a period that includes that surge, it will probably have a higher rate than one that does not.
But isn't that just a reflection (and after-effect) of a more fundamental, underlying cause -- that is, the extent to which low- (and medium-) skill labor itself has become devalued, in recent decades -- along with, of course, the very class of persons taking those jobs? Along with a host of other changes in attitudes (sharply) favoring the welfare of the high-skilled -- and above all, of the rentiers -- over the welfare of those who actually do the bulk of the work that keeps our civilization actually running?
Which is presumably what motivated the actual votes on the particular pieces of legislation you (quite validly) cite.
Here is an interesting point:
http://stuartschneiderman.blogspot.com/2016/11/the-problem-w...
Agreed.
> and there's less of that here than in most other countries.
I've seen evidence that the US is actually not doing that well on this scale, particularly measured against other wealthy democracies.
What's particularly painful for people is that there's less equality of opportunity here than there was 40 years ago. I do think we need to do something about this, though it's not entirely clear what.
Planned economies such as the USSR clearly impinge on human liberty, tend to be undemocratic, and are usually very inefficient, and I think almost everybody would agree with you that they aren't a good alternative to the current U.S political and economic system.
I disagree that they impinge on human freedom, at least I don't think they do compared to capitalist economy. I see no reason why they should be undemocratic. And you'll find nobody in favour of a 5 year plan as the USSR had; there have been massive advances in economic planning methods, as elaborated by Cockshott et al.
I love the irony of saying it is "inefficient" especially when we compare it to how currently under capitalism firms compete by doing the same research, repeating the same mistakes, often extremely inefficiently, in the name of profit. This is one of the most inefficient things I have heard of.
The USSR planning model isn't a good alternative. But I think that some economic planning model, whatever it may be, should not be ruled out, especially as it can feature as part of lower-stage Communism.
Some levels of inequality are healthy and motivating, extreme social inequality with large groups of population feeling left behind by the social system is undermining stability and a recipe for revolution.
Or, I'd modify that to say they eat the upper middle class, because the truly rich just bolt at the first sign of trouble.