Comment by deepstream | Hacker News Reader

Comment by deepstream | Hacker News Reader

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how can we cure these poor people from this delusion that they have a right to possess what they have not earned?

life is inequitable you have to fight to get a higher station. substituting taking responsibility to create wealth for convincing yourself you're entitled to it just disempowers you.

I'm not saying it's not hard. but that it is hard is not special and that it is hard is the motivation to overcome it. and when you get there that your hard earned achievement can be taken away by people who don't want to overcome is wrong.

The fundamental point is this wealth is not some free right it's not some magical thing that just exists. wealth is precisely the value created by overcoming difficulties.

wealth is made by work and the people who make it ought to be free to choose what they do with it rather than coerced into surrendering it in the name of equity, a false equity which is inequitable to the moral nature of wealth, responsibility and hard work. that kind of idea is a disease that will erode away the social foundation.

I'm not saying wealth disparity is easy nor that it creates no problems. it creates a lot of problems but I don't believe the solution is by redistribution. at least not at this stage of human and economic evolution. while our species is still bounded by the amount of energy we can extract from our surroundings.

taxes yes, State yes, a social welfare net yes, but not to an excessive degree, and not to cure inequality.

if energy was free of course it should be distributed to all without cost. like air.

but it's not. to do so would bankrupt our species in the name of compassion. the greater compassion is the realization of the poor state we're in, and the preservation of all. not the temporary satisfaction of some who convinced themselves that things should be easy.

one day as a species we will get there. no crushing disparity. but we're not there yet. trying to live like we are already there is a toxic delusion that doesn't help us get to that more compassionate future.

Wealth is made by labor, yes. But it is not accumulated by it. It's accumulated by being in a position of power whereby you can extract rents from the laborers who make it. In older times, this was done by threat of physical force. These days, it's more often done by exploiting some economic advantage - for example, if you own any valuable resource, such as land or means of production, you can extract rent from people who use it.

Whenever you see concentrated wealth with such extreme disparity that you have one person owning more than a million others, there are only two possible conclusions: either they really are a million times more productive, or it was actually produced by that million, and extracted from them via rents.

You could argue that those rents are fair, since they stem from legitimate ownership. But what makes it legitimate? Most land was originally taken by force, for example, and the result enshrined in law (that was written by the people who did this) post factum. If that doesn't make economic advantages that stem from such ownership unfair, then surely the same standard holds today, and those people have no right to complain if society decides to take it away from them by force, and enshrine it into law, just because it can.

Exactly, and there’s in particular the very special kind of rent extracted by the hiring of people to work for you without profit-sharing, and using your negotiation power as a capital owner to get people to agree to the terms of your employment contract stipulating your appropriation of the whole work product.

I’ve found the writings of David Ellerman to be very elucidating on this topic, and admirable for giving a deep critique of capitalism without any reliance on Marxism. He relies on a labor theory of property rather than a labor theory of value, and a Lockean liberal notion of inalienable rights. Two short texts that make a good introduction:

https://www.abolishhumanrentals.org/human-rentals/the-great-...

https://www.abolishhumanrentals.org/human-rentals/the-fundam...

Land is finite natural resource and its ownership is a zero sum situation. Company ownership, however, is not. It is entirely possible to own your sweat and labor, which is demonstrated by millions of small business owners.

The sentiment we hear often, however, is yearning for benefits of co-owning a (ideally mature and profitable) business while retaining the hired hands' rights. Not many are keen to give up their 8 hour workday, benefits, social welfare net for the upside of owning their share of corporate profits.

Exactly, people are making choices, and then complaining about it, which make sense as a coping strategy, but not if you really want to own your own labor.

Why should they give up those things? Why not have both?

There's hardly a place in the world (yes, even in Scandinavia) where starting a business entitles you for welfare or the usual labour rights. A typical small entrepreneur has to live with that for years, until the cashflow becomes viable enough to support them employing themselves.

I realize that's not what most people have in mind when they ask for profit sharing. They want to be a part of an already successful operation, and take no risks. And that's precisely what I've been talking about. The process of building a successful business is given little thought, as if they grow on the trees or are being brought to Earth by meteors.

Then there's that thing with businesses statistically being just slightly more often in black than in red. Would your profit sharing scheme involve absorbing the losses as well? How many takers you think it will have? If not them, who will get to absorb the losses, potentially reinvest to weather through rough times etc? The expense would be not negligible, on the order with the profits.

Scandinavian entrepreneurs and coop workers can certainly participate in the social security. Probably some reforms could make the situation better, especially if cooperative business becomes more of a norm.

When the firm spends more than it produces, it needs access to capital. This can be in the form of savings, credit, or new investment. Small new businesses are routinely launched through loans. Credit institutions are quite used to absorbing losses.

A worker-owned coop can also take investment from external capitalists. It would just be in the form of a profit-sharing contract rather than equity with voting rights.

We are in Norway and my wife ran her own small construction engineering business for a few years. You get no welfare, as it is funded from your previous payroll contributions, and only for up to 2 years. If you business is too small for you to have yourself on payroll, tough luck. Getting there takes a while, as tax burden on a business here is quite significant.

> Credit institutions are quite used to absorbing losses.

They are also quite good at taking the profits on their investments. If a bank bails you out, it wants to take its pound of flesh. You essentially arrived at status quo.

> wealth is made by work

It’s also naturally abundant in the form of land, those cadastral game tiles on which life plays out, dominion of which are allocated by the state in a system of hereditary monopolies.

Wealth is not allocated the same way it’s created. That’s why we have the concept of rent-seeking, behavior that increases one’s share of wealth without creating more wealth.

Owning wealth lets you accumulate more wealth without working, because you can charge other people rent in exchange for using your wealth. Not only that; you can also hire people in an arrangement where you automatically own everything they produce using your capital goods.

Rich people know that labor is a very inefficient and tedious way to increase one’s own share of wealth. That’s why they prefer rent, interest, and staying on the top of the employment hierarchy where they have a legal claim on the products of others’ labor.

Yes, work is a true source of wealth, and so is capital and land and the other factors of production. There’s a long history of criticizing how most of the wealth created by working ends up owned by the owners of capital and land—that’s the essential critical point in the discussion of capitalism, whether Marxist or Georgist or Ellermanite.

Or you could say the crucial question is how can we cure the rich people from the delusion that they have a right to appropriate what they have not produced?”

How do you extend this argument to, let's say, three of the richest people on the planet namely Bill G, Mark Z and Jeff B ? What cure do you suggest for them?

That's why the Marxist critique of capital is wrong. Was use of capital to extract rent from others ethical or not? Maybe yes, maybe not, who knows. It is impossible to decide.

Georgist perspective doesn't blame the rich capitalist, but the rentier, no matter if rich or poor. Rentiers provably extract others people's and businesses' labor.

Renting out capital is not an ethical problem, but renting labor is. Human actions are not a commodity, and treating persons as tools is wrong for the same reasons “voluntary slavery” is wrong—it violates inalienable rights. The problem with capitalism is that capital owners alienate persons from their own natural property rights through the injustice of employment contracts. (Land ownership is also a problem in our world but it’s sort of orthogonal to capitalism, although it depends on how you define capitalism. Georgists make a big distinction between capital and land; maybe we can talk about both capitalism and “landism” as different strands of the economic system?)

Something like using legislation and taxation to shift corporate structure towards something more like democratic worker-owned firms. But that’s a long term project; I don’t suggest suddenly and forcefully restructuring existing corporations. As a fundamental long term goal I suggest abolishing the renting of people (a la David Ellerman), along with heavy taxes on land value (a la Henry George).

no you couldn't. I think you've been deluded by fancy sounding ideas.

you could just as well say that people are rent seeking with their labor, using the capital of their bodies.

if you deny personal ownership of property and land and the ability to extract wealth for rent from that ownership you may as well also deny personal ownership of one's own body and personal space and the ability earn income for renting out one's time, or professional service or the capital of one's body. that gets you to slavery in one step, well done.

so the simplistic argument that labor capacity of people is fundamentally different to other capital is false. consider that you invested your time and your money in your education to better your skills increasing your ability to rent on your own capital. if you want to deny people extracting money from their investments and property why not also deny them extracting money from their investments in their own education?

so again I think on the premature path to compassion and equality in your mind you have actually found a shortcut which disempowers people and limits their freedoms. I don't think you did this intentionally, you just haven't thought it through.

I understand the temporary appeal but it does not actually provide a workable solution to the problems you are trying to address.

the next step is consider what the second-order effects of policies inspired by your theories would be. the ultimate goal of this is to create a dependent slave class to do the bidding of the elites. these theories have been designed for mass appeal.

Nowhere have I argued for eliminating private property or renting out land or capital; I’m for all of that, so I can’t really respond to your condescending dismissal.

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