Hacker News Reader

Comment by lm28469 | Hacker News Reader

> If AI produces surplus where does it go? Not talking about investment backed datacenter buildout and AI labs. Talking about the results of AI work...

The 1% pockets, this is where the vast majority of the extra productivity computers/internet/automation brought goes to for the last 50 years: https://www.epi.org/productivity-pay-gap/

View on HN

The study doesn't say it went into the 1%'s pockets. It says it went to 2 places:

1) The salaries of corporate employees 2) Shareholders and capital owners

Regarding number 2: "Shareholders" would include anyone who owns any stock at all, including a lot of middle class people with a simple S&P 500 ETF in their portfolio.

And the increase in productivity allowed more people to become capital owners, AKA entrepreneurs. The explosion in software entrepreneurs, for example.

#2 only works if the public is allowed to invest when the new technology is in its early stages, which is currently not the case. Microsoft went public in 1986 at a valuation of $2.3 billion (in today's dollars). What's OpenAI / Anthropic going to be worth by the time they IPO? $1 trillion? $2 trillion?

Eh, buying and holding the S&P 500 (the Vanguard Bogleheads strategy) has allowed a lot of people to retire early.

> Regarding number 2: "Shareholders" would include anyone who owns any stock at all, including a lot of middle class people with a simple S&P 500 ETF in their portfolio.

Yes, but shares are not at all uniformly distributed. Tim Cook owns 3.28 million shares of AAPL. For comparison, the 50 million Vanguard customers have to divide 1.3 billion shares amongst them, averaging about 26 shares of AAPL each.

> And the increase in productivity allowed more people to become capital owners, AKA entrepreneurs. The explosion in software entrepreneurs, for example.

The majority of those end up getting bought by larger software companies.

Overall capital ownership is increasingly concentrated among a small number of elites.

Then why are wealth inequalities exploding? Why are we just about to witness the first trillionaire?

Because no matter what fairy tales you want to believe in your $20 "invested" in palantir won't make you a "shareholder" lmao

Wealth inequality is increasing, but the wealth isn't all flowing into the 1%'s pockets.

Lots of middle class people have graduated into upper-middle class: https://www.aei.org/research-products/report/the-middle-clas...

Wealth inequality is still a problem. But it's not just the people at the very top benefitting.

I don't think you understand what the 1% is, it's not your neighbour who has a nice house, a swimming pool and a ferrari...

https://images.seattletimes.com/wp-content/uploads/2017/12/9...

https://www.peoplespolicyproject.org/wp-content/uploads/2020...

https://datawrapper.dwcdn.net/CvQar/full.png

https://static.guim.co.uk/ni/1415721490539/Wealth_line-chart...

Definitionally the 1% is people making ~$800k+ a year.

Upper-middle class is people making ~$200k/year.

A lot of people have moved from middle class to upper middle class over the last decade. Both those categories are outside the 1%.

When did upper middle class start meaning upper class? Something like 90% of Americans identify as middle class now.

That's why someone's self-described position means nothing. Something like 80-85% of drivers describe themselves as "above average" at driving, too.

The upper limit and the median of the household income quintiles as of 2022 are:[0]

  Lowest: $ 30,000 / $ 16,120
  Second: $ 58,020 / $ 43,850
  Middle: $ 94,000 / $ 74,730
  Fourth: $153,000 / $119,900
     Top:        - / $277,300

I think getting into the weeds on whether $80k or $100k or $120k/yr is a middle class sort of misses the point, but at least with my eyes it is hard to argue you're middle class if you're making more than about $150k at the most.

Even the GP, which I directionally agree with, says "upper-middle class is people making ~$200k/yr" but you're deep into the top quintile by that point, probably top 10%. I don't know what percentile I consider "upper middle" but it's definitely lower than top 10%.

[0] https://taxpolicycenter.org/statistics/household-income-quin...

A good indicator that someone is simply being dogmatic and not arguing in good faith (e.g. actually trying to understand someone's POV, and being open to being proven wrong in their assumptions) is when it takes them 5-20 minutes to reply until a particularly good point is made and then they disappear into the ether.

That's called "having a life" or "living in a different timezone"

I didn't say A means B 100% of the time, just that it's an indicator. The same way having a car with a lot of dings and scratches and holes doesn't mean you're a bad driver, you could have just purchased it that way or they could have happened through no fault of your own. But it's still an indicator - one piece of evidence to be looked at holistically.

But I notice you haven't actually responded to the point that "the 1%" actually does mean "your neighbor with a nice house and a pool" because $800k income puts you in the 1%. That's two doctors in not-particularly-highly-paid specialties. That's two good attorneys at big firms. That's two FAANG software engineers. Definitionally there's not going to be a ton of people in that group, it's hard to get into that group, but they're everywhere not just billionaires twirling their mustache and trying to reroute rivers to sell the water like some caricature.

Reply on news.ycombinator.com