No one should be a billionaire | Hacker News Reader

No one should be a billionaire

theweek.com

18 pointsgilad28 comments

No person is actually owning billions in the way a normal person is owning 100$. There is just no way to spend a billion dollars by consuming. There is no diner that you can eat that will cost a million dollars.

So, what does it mean for a person to be a billionaire?

It means that they control resources. Organizations, human resources, intellectual property, land, minerals.

Controlling resources is freaking hard. A random, average person who wins in lotto will most likely lose their wealth as soon as they start trying to do anything ambitious with it because controlling big amounts of money is very difficult.

Self-made billionaires are proven to be very, very good or even extremely good at controlling resources. They managed to change 100 000 dollars, into 100 million dollars, into 1 billion dollars. That means that other people decided to give them control over these resources (or may be willing to) in exchange for something that they considered equal value. They made and control something of value and are proven to be good at doing that.

So assuming that market value is well aligned with more general societal wealth, I'm happy that billionaires do control resources. Not because it's fair or not fair, but because they are good at that. They are better than officials that we can elect or choose based on some other bureaucratic processes. Are they perfect? Certainly not. Is the market aligned with the interests of society? Generally yes, with big exceptions.

There are some other conclusions, for example, children of billionaires are not proven to be extremely good at doing anything by being their children. Therefore, we may have some better ways of controlling billions that their parents controlled.

> Is the market aligned with the interests of society? Generally yes, with big exceptions.

I think recent history has shown us that the answer is "Generally, no."

What recent history are you referring to? I'm thinking for example about China. China raised almost a billion people out of extreme poverty in the last 30-40 years mainly due to switch to the market economy. This is arguably the biggest miracle in the whole human history. I'm myself from Poland and our switch from communism to capitalism has been good for almost everyone.

There are however externalities to the rise in human living conditions. Pollution, global warming, super bacteria etc.

Still, my perception is "yes, with big exceptions".

The article mentions that CEOs are not important to a company, if that was true why would they hire a CEO instead of 300 more full time employees. Obviously there must be some huge value to having a single person direct the company.

“Is anyone willing to defend the idea that any human being is really able to provide society with labor that is 300 times more useful than another's?”

Not too hard to come up with examples. A Western Medicin doctor (vs. some homœopathy ditto). An inventor of something useful, etc.

It’s also weird to compare a few CEOs with all farmers and ask who we’d miss more. A fair comparison would be a to compare the same amount of people in the two groups and ask who you’d miss more.

There are some intriguing issues around inequality. I think there are some obvious problems with how the US and other countries are wired, but this article isn’t intellectually honest enough to provide an interesting argument.

While I think you are right about this comparison, I still believe the initial hypothesis is a good one: "Does anyone deserve to have a billion dollars?"

No matter what the rest of the article tells us or asks (because there is just no definitive answer) we have to see if there is moral/logical arguments why people should have so much more than others in a world where people still starve and children can't afford to go to school.

Some of those super rich people didn't even earn that money themselves, others don't deserve it just because of the way they got it.

Well, the question could be asked - "does anyone deserve a million dollars?" Even if we agree that no one should have a billion dollars, where would we draw a line here? half a billion? 100 million? 1 million? 100 thousand?

I feel such arguments are so superficial. Billionaires are economical human anomalies. While they are easier to point and say that they are the cause of human greed and they need to do more for the society - IMO, the better question to ask is

1. how can we uplift the bottom echelon of the society and fix the systemic issues that put them in the poverty cycle.

2. Would we shit on billionaires and millionaires less if overall poverty in the world declines?

3. How can government programs become more efficient?

I just feel asking questions like 'should billionaires exist' do not push forward the discussion about bringing in systemic changes. Targetting them only gives a superfical understanding of what's wrong and gives an easy way out of the discussion.

I agree. The main reason for over-population is the lack of enough wealth (https://en.wikipedia.org/wiki/Income_and_fertility) and I think this is important for the ongoing inheritance of poverty.

1. The systemic issue is that there is no one on earth who stops powerful companies and individuals from the reckless exploitation of the poor (and those who really think they aren't poor). No police, no government etc. seems to take care of this issue. Instead the majority of them is just a step-stone on the way for rich entities to gain much more power and wealth.

2. Of course it wouldn't be that obvious as an imbalance. It's a problem of distribution of wealth and the most important thing here is the ratio: - How many poor vs. how many (super) rich? - How much is the difference of their wealth and what consequences occur in their lives because of that?

As long as children starve because they don't have food in my opinion it's perverted and ugly that people have money they don't even know what to spend on. From the view of "overall fairness" it's so unfair that it's unbearable to keep that thought in your mind for a longer period if you have moral integrity (most humans have that in some way).

3. Government Programs huh? They aren't designed to be efficiently and they aren't backed by science. That's the case on most places on earth. Govt's seem to be controlled or at least influenced in many dimensions by "big money". When you look around the world, especially at democracies who demand to be democratic (wow!) you'll see the more wealth entities have, the more they can influence any political decision. I don't know how to break this devil's circle but if it doesn't happen I see a lot of (innocent) blood in the near future.

There has been discussions about the change of systems, governments and society for so long but the development is not happening in the way some big minds and honest people have hoped for.

E.g. everything that can be tagged with "social reforms" will be drowned in pseudo-arguments: * social = socialist = communist (even today you evoke fear with that in most US citizens and also parts of EU) * social = non-productive (no goods to sell); Too many have this micro-economic view and disregard the macro-economic effects * social = expensive when done in a proper way;

I could go on with this but it tires and saddens me to even think about it. I had to watch this the most of my life and while the elders had enough to live when I grew up today I see them scavenging in the city. It just get's worse and while this political way doesn't seem to work I think some day we'll reach a critical mass of hungry and angry people who will just take what they deserve.

While I agree with you on 1 and 2, I respectfully disagree on 3. The are many very efficient government programs that function as well as could be expected for such a large system. Voting in the United States, while not always perfect runs mostly clean and efficient. Government run healthcare programs across the world seen to function fairly well. It's not government that's the issue. It goes back to your initial points. Once you have a power imbalance created by either one or a small group owning most of the debt (money) in society, the power imbalance causes corruption. The solution is relatively simple but unpalatable. Once a group reaches a certain percentage, not a specific number, of debt above the median they get taxed more heavily with that money going either directly to the bottom or to programs that benefit all. The percentages are relatively easy too, break the groups into quartiles. The top quartile should not have more money than the next lowest quartile. If more people become wealthier the taxation automatically becomes higher to spread the wealth. To keep individuals from gaining all the power you adjust the number of people based on a bell curve. Those in the top quartile should be very rare, the and as those in the bottom. That's the entirety of the taxation system. It's based on owned debt. It doesn't matter what you spend your money on, or anything like that. Money gets efficiently spread to the middle class and on keeping the lowest portions of society from abject poverty. What the wealthy do with their money at that point doesn't matter because there's a built in check in the system. Punishment for hiding money would be brutal, if the wealthy want to leave, there's the door.

Ok, so the solution would be to decentralize and distribute solutions to autonomous entities to reduce the size of the system that is directly involved (big system is still the source of money and strategic planning, like in most companies). I think that could work because we know effects like this on groups of people - you can work with 7 but don't try to work with 20 all together.

Nice idea to take the debt away again but that can't work in a world where these entities afterwards take refuge in another country that doesn't tax them (so much). EU has some good examples for this: Luxemburg, Netherlands and Ireland. A lot of tax money is taken away in the EU by companies like Apple, Ikea, Starbucks and the likes because they have mastered the skill of using legislative loopholes to maximize their profit and screw the people of the world by taking that money away from the public.

That would be the doors you are talking about and the problem is that the nations just don't get together to solve this issue so the wealthy can do whatever they want - they aren't bound by national laws etc.

I would like to add one thing to this idea: * Raising the wealth of all people on the globe to the minimum level required to have a "good life" (no starvation, education, lower fertility rate). I think this would solve a lot of problems at once.

I don't think any of your response is invalid. The debt situation could, but hasn't been a problem in the past, however this is a bit more drastic than what's been suggested in the past. I like that we both see that a solution is indeed possible though.

I believe your argument is that we should never have clear-cut legal boundaries on anything where there isn't a clear-cut, justified reason.

If I understand you right, you also believe there should be no specific age where people can vote, or drink, or become US Senator. Because what's special about being 18, or 21, or 30 years old? Nor age restrictions on when someone can decide to get married.

There should be no progressive income tax, because what's special about each boundary?

There should be a gift tax on all gifts, with no special change at $15,000/year - or no gift tax at all.

Note that the latter two are meant as ways to address your #1. Getting rid of them requires coming up with alternatives ... and I don't see any good alternatives.

I disagree with the basis for #3. I want my government programs to be equitable, fair, just, transparent, predicable, .. and rank 'efficiency' as a far lower importance.

And I feel that asking questions like "should billionaires exist" to be important in understanding why it is that, for example, Gates and other billionaires have an outsized, inappropriate, and anti-democratic effect on US school systems.

Well sure, some people have outlandishly large benefits to the world. But those people depend on a huge pyramid of farmers, factory workers, public service workers, teachers, mailman, etc to enable them to spend their lives in whatever specialty.

A billion $ is a pretty mind boggling amount of money, pretty foreign to the experience of most of us. Imagine buying a $75k luxury car every month... for 50 years.... on less than 5% of your money.

Or even a $650k house, in every state, every year, for 25 years.

Or both.

If Elon musk wasn't allowed to be a billionaire would we have Tesla? SpaceX? Would Amazon exist?

Companies like Amazon are efficient leaders in their segment. Was it just the first movers advantage? Or could a random parade of CEOs have achieved the same thing?

I think a more useful question is, should we allow billionaire's that don't produce anything. Seems like inheritances, manipulating the stock market, and related aren't actually benefiting the world compared to Amazon or Tesla.

Yes, these companies would still exist because people are driven by achievements and competition, and would presumably still be able to become extremely rich.

If you have 50-100 million dollars, you've more than made it financially. So "no one should be a billionaire" should come with "where do you put the threshold?"

It would also seem very difficult to prevent people from being shareholders in their own companies. Most of the wealth of e.g. Bezos comes from his Amazon shares.

Dunno. People thought it was crazy to start an electric car company. Electric cars were horribly impractical, and nobody has started a new car company in the USA in many decades.

Now of course that Tesla has demonstrated that it can be done, there's many similar attempts (like Rivian). It's not clear to me that we could have a Tesla without having Elon much with a few billion in his pocket.

Mmm, there were electric car companies in the US before Tesla, started within a decade of Tesla.

AC Propulsion (1997) tried producing the t0. https://en.wikipedia.org/wiki/AC_Propulsion_tzero

In January 1996, Corbin Motors began work on developing an electric vehicle. The Sparrow passed final testing for Department of Transportation certification in April 1999. In September of that year, the Sparrow production line began manufacturing multiple vehicles in Hollister, California. - https://en.wikipedia.org/wiki/Myers_Motors

They weren't successful, but that's different than your point about "nobody has started a new car company in the USA in many decades".

Electric cars have been around since cars have existed. The only reason ICE ruled cars is because we hadn't gotten to an acceptable power storage ratio comparable to the insane amount of potential power stored in oil.

Why is Tesla outcompeting everything in the electric vehicles market by such a big margin? There is still no car that is able to compete with Model S from 2012 on the range.

https://en.wikipedia.org/wiki/List_of_electric_cars_currentl...

By being way more expensive. Tesla doesn't have some secret new battery chemistry, they just put more batteries in the car.

That and they market the hell out of the car, cutting out middle men where possible. The aren't burdened by the dealership model and have been very protective of their brand. It's not like electric cars weren't made by the large auto makers, they just weren't willing to spend as much as Tesla has to feet to profitability. When Toyota made the Prius they went all in, now the Prius tech is in many of they're other cars. American manufacturers doubled down on bigger, higher polluting trucks and SUVs that all look the same and haven't had innovation in years.

While true, it doesn't seem relevant to my observation that "nobody has started a new car company in the USA in many decades" before Tesla is not correct.

I'm sorry my point wasn't to criticize your point, just bring up why electric cars stopped development in favor of the ICE cars. I was intending to add to your point not take away.

Thanks for the clarification!

Since Tesla is still losing money, I wouldn’t exactly say they are “successful”.

The cars are profitable and have a healthy margin, it's just that Tesla is investing the profit into growth. Said growth has been pretty impressive. They've gone from 0 to 1000 cars per day or so, and given their average selling price that puts them ahead of quite a few others, at least in the US market.

Is amazon not successful because for most of their existence they have invested in growth over taking profits?

The cars have a marginal profit of 3% to 4% after you remove the tax credits and that’s not enough to cover their fixed cost. They aren’t “reinvesting” profits. They aren’t making enough to cover fixed costs.

https://www.forbes.com/sites/jimcollins/2019/01/18/teslas-pr...

As far as Amazon. It’s still doubtful that Amazon retail will ever have the margins to justify its value. AWS on the other hand should stay a high margin business.

https://www.fool.com/investing/2018/04/14/is-amazon-com-reta...

> If Elon musk wasn't allowed to be a billionaire would we have Tesla

Have you read the history of Tesla? Elon Musk didn't start Tesla...

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