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Comment by v-erne | Hacker News Reader

I have seen this sentiment and on the surface its looks right. But I feel that we are missing here some real studies that should be done into impact of life style of the rich on the whole economy. I know few rich people (some of them ungodly rich). And seeing glimpses of their life style I cannot simply ignore cohorts of supporting jobs that make it all possibile (just to mentions few : private guards, house keeps, gardeners, cooks, private pilots on call, yaht crew members, drivers).

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And yet account for all of that and divide it across remaining population and it will come out to nothing. The majority of their wealth is super inflated assets that would not change anyones life if divided across the population.

According to Wikipedia, in 2016 the Top 500 richest Germans, owned a combined wealth of 692 Mrd. €. That's around 8500 EUR per German citizen (infants and kids included) in 2016 - more today. For some people that is an amount that substantially affects their life.

https://de.wikipedia.org/wiki/Liste_der_500_reichsten_Deutsc...

that includes real estate in Monaco priced at 100K per square meter, works of arts jewels, stocks trading at 100+ PE etc. e.g. sh#t not convertible into shelter, food and other things people need. It's not that elastic on a gloabl scale.

The majority of this is ownership, for example the Quandt family owns nearly 50% of BMW. Stefan Quandt alone owns 25% of BMW. It's pretty elastic - and that wealth share of 700 billion is owned by 500 out of 80 Million people or 0.000625% of the population.

You are assuming that thats convertible to something tangible which it isn't at global scale. We just had a large scale experiment in this area with Covid. Food prices went up real estate is through the roof.

> The majority of this is ownership, for example the Quandt family owns nearly 50% of BMW.

This is still based on two massive misunderstandings:

1. This share is cash, when it is not. It is just evaluated as a cash value for simplicity. Removing these people's shareholding does not make actual money appear.

2. People have to buy shares in order for them to be worth anything. Why would anyone buy shares in your world?

Yes, but you are liquidating the companies they own. If you consume them, they become much smaller, which means they have less employees, less work, less income, etc.

This is consuming capital for expenditures, which will in a macro view reduce wages in the long term.

> And seeing glimpses of their life style I cannot simply ignore cohorts of supporting jobs that make it all possibile

You shouldn't ignore them. They all get paid, which circulates money through the economy.

Sure, but I believe that money and money circulation is only means to an end and this feels like loosing the sight of end goal. Its a bit like saying that war is a viable economy booster (it can eventually create economic boom like WW2 has done in mamy countries that were rebuilding but this only make sens if You ingnore the obvious upfront costs)

There is no end goal. The end is not in sight for progress; we need to keep going, and keep in place the one system that has really allowed it.

And yes, they are a means to an end (uplift your family's lot; achieve personal goals through the choices money allows; stay healthy as long as possible; etc etc).

It creates real jobs and wealth. A friend of mine has 200 people employed in his family office.

"Real jobs and wealth" ... imagine putting them to work into something truly useful and creative, rather than a group of beck and call people.

"putting them to work" - what are you talking about? They are choosing jobs.

Im guessing that He is talking about "having job" being a poor abstraction for value creation from point of view of whole society. Its like triple A rating for CDOs backed by subprime morgages. On the surface it seems good but if You look close enough You will see only bullshit and wishful thinking.

I don't think your comparison holds. There is not whole society acting in concert, nor even in agreement about what is valuable. There are just individuals, some of whom band together into companies and other organisations, all with different priorities.

I believe that throughout history few golden rules emerged (most of them boil down to "do as You would be done") which keeps our societies more or less stable (we, or rather some of us, are still here, dont we?). Even those who abhore this rules most of the time keeps it to themselves. But if we as a society give individuals too much power then some of them will try to impose their own random ideas and values on us. This was happening with kings and feudal lords and this is happening now with some (if not all) of capitalistic roulette winners.

Exactly. Thank you. Who is really doing the "choosing" here.

We're not giving power as a a society. We are rewarding people through a system who create value in that system.

If I can sell a billion people a widget for $2 that cost me $1 to make and ship, then I become a rich person without "society" being involved or "giving" anything.

The people who have generally perpetrated tragedies have been tied to government rather than commerce. Your examples are all governments or equivalent, and this is where your final analogy is inadequate, I think. The power balance is ultimately that any government at any time can ban any company.

What wealth does a yacht crew member create? A private guard? Or a private chef? These are all luxuries wholly consumed by the individual rich person, and whatever "wealth" may have been created vanishes the next day under the spin of the hedonic treadmill.

The labor of these employees could have instead been directed towards build infrastructure, nursing, childcare, or any other number of jobs which generate real and persistent wealth which compounds across generations.

>The labor of these employees could have instead been directed towards build infrastructure, nursing, childcare, or any other number of jobs which generate real and persistent wealth which compounds across generations.

Yeah, that's called investment, and rich people also get flak for that.

> The labor of these employees could have instead been directed towards build infrastructure, nursing, childcare, or any other number of jobs which generate real and persistent wealth which compounds across generations.

This is a silly yardstick. There are countless jobs like that. Probably half the people on HN don't have those jobs, and aren't employed by the super rich. If you're choosing who to criticise and then making up criticisms, and don't care if those criticisms also apply to countless other situations, then that's unlikely to be convincing. Except to those looking for a reason to justify their preconceptions.

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