Comment by dmix | Hacker News Reader

Comment by dmix | Hacker News Reader

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Yes, lowered inequality is a good metric for success but it's very popular these days for it to be sold as a complete solution in itself. The problem with pure redistribution as a model for increasing wealth in developing countries, or stagnant wealthy ones, is that you can only take someones money and give it to another person once. You can't transfer a wealthy persons ability to generate wealth to another person or country.

A long term reduction in poverty and a more balanced relative income ratios has to come through self-sustainable economic development in the middle, and upward mobility from the bottom. Wealth transfer is just a temporary fix, an initial boost - but it is not an adequate endgame... as many pure socialist countries quickly learned after the glow of the early days wore off. Redistribution as a primary policy is also increasingly difficult to pull off via central policy, given global marketplace, technology's impact on finance, and the growth of countries which act as tax havens.

There is plenty of indifference in practice towards legitimately taxing the wealthy but it's been a hot topic globally for a while now and I fear this obsession has been a large distraction from figuring out how to help the middle/bottom develop their own jobs and businesses. To push up their wages and salaries as the primary goal, not just increasing the tax base for better government services and reduced tax burden on the middle.

"You can't transfer a wealthy persons ability to generate wealth to another person or country."

When wealth generation is coming from rent collection on existing assets, redistributing wealth and redistributing wealth generation are equivalent.

In other words, wealth is the means of production.

Nothing is being produced when rent seeking.

That's a good point, which potentially leads to Georgism: https://en.wikipedia.org/wiki/Georgism

> Georgism, also called geoism and single tax, is an economic philosophy holding that, while people should own the value they produce themselves, economic value derived from land (including natural resources and natural opportunities) should belong equally to all members of society.

> Any natural resource which is inherently limited in supply can generate economic rent, but the classical and most significant example of 'land monopoly' involves the extraction of common ground rent from valuable urban locations. Georgists argue that taxing economic rent is efficient, fair, and equitable. The main Georgist policy recommendation is a tax assessed on land value. Georgists argue that revenues from a land value tax (LVT) can be used to reduce or eliminate existing taxes (for example, on income, trade, or purchases) that are unfair and inefficient. Some Georgists also advocate for the return of surplus public revenue back to the people by means of a basic income or citizen's dividend.

That actually matches my current political views fairly accurately. I didn't know the name for it (or that there was a name for it).

>lowered inequality is a good metric for success

For measuring the success of what, exactly? Economic success? Average incomes? Doesn't seem to be a very good metric for either.

Lowered inequality seems to me to be a good metric for measuring the success of attempts to lower inequality, and not much else.

It's a good metric for success at giving everyone equal opportunity at birth.

Not really. You can have low income inequality through redistribution of wealth and still have massive differences in opportunity at birth based on other, non-monetary societal factors.

I see that, and yet those other factors nowadays have some correlation with wealth too. In Spain gypsies are discriminated against, with a stereotype of them being poor, not educated, and thieves. And yet the children of a rich gypsy football player won't probably even be thought of as gypsies, just kids.

That's not because he's rich; it's because he's a famous footballer. People won't know that he's rich if he's not also famous, and they associate him with the club he plays for and the skillset he possesses more than his wealth.

I disagree: You're describing what fans of him will think of his son.

But in this kid's day-to-day life after graduating, unless he becomes famous on his own, nobody will know who he is. They'll just see a dude that dresses well, lives in a well-off neighborhood, and got an education like everybody else. He won't have been raised in a violent neighborhood with poor access to education. And no employer will think twice about his application on account of his looks or the way he speaks.

That's possible, yes. However if his father is not a football player but instead is a bookkeeper, the education and accent may end pulling him out of the racial association he is in just as easily.

Yeah, agreed, I was thinking of the footballer because it's a real-life case I know of. But it's not necessary to have rich parents, just not being poor helps with those other societal factors you mentioned that hinder equal opportunity.

Theoretically only.

You can't transfer a wealthy persons ability to generate wealth to another person or country.

Isn't that exactly the VC model?

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