The Positive Sum Outlook

Related Post Roulette

453 Responses

  1. Avatar North
    Ignored
    says:

    Not bad, though to be frank I don’t see why you’re letting the Conservatives piggy back under your essentially libertarian umbrella. The tea party in part and Conservatives generally are definitely zero sum in outlook; economically and especially culturally.
    Economically they are focused on the resolution of a mutually created problem (debt) by forcing the solution to fall only on one sides priorities (social safety net programs and other liberal favored projects) while protecting their own favored projects (drug prohibition, moral crusading, wars, defense spending).
    Culturally the conservatives (and Tea Party) are even more zero sum. They view the increase of liberty for others (women, minorities, gays) as resulting in a loss of liberty for themselves; even when in many cases they can’t(or won’t) define how exactly they are losing out when others liberties are expanded.
    So I’m somewhat sympathetic to your take though I strongly disagree with you ascribing it to conservatives. Part and parcel with the general republican cultural capture of libertarianism in America I guess.Report

    • Avatar Roger in reply to North
      Ignored
      says:

      North,

      Thanks, I think your criticism is apt. I added the conservatives in to the libertarian side as a last minute rewrite. I think you make a good argument that this is too generous, especially if we extend from economics to social issues. Any conservatives care to weigh in?Report

      • Avatar Plinko in reply to Roger
        Ignored
        says:

        Zero-sum thinking is not limited to liberals, it’s a natural worldview for most people, period.
        There are plenty of conservatives as well as liberals and even libertarians that espouse the zero-sum view, it’s just too easy to see transactions as following a law of conservation.

        The best example for conservatives is probably seeing immigration as if it causes the same economic pie to be divided among more people instead of an increase in capital and potential productive capacity.Report

      • Avatar Tom Van Dyke in reply to Roger
        Ignored
        says:

        Any conservatives care to weigh in?

        No. It’s more of the usual misrepresentation. Social conservatism is rooted in a concern for the stability of the society, not any of this zero-sum nonsense.Report

        • Avatar Kimmi in reply to Tom Van Dyke
          Ignored
          says:

          no, social conservatism is longing for another time. When “men knew their place” and the rich were allowed to be fucking rich, and everyone else groveled before them. When sophistry and clever words were used to control the masses, and the priests were used to justify the rich (the god-given right to be a monarch, among them).

          Do you want to be rich? My advice: don’t. It’s not worth it.Report

        • Avatar Roger in reply to Tom Van Dyke
          Ignored
          says:

          TVD,
          That answers that! I too value stability, but where does prosperity come from then?Report

          • Avatar Stillwater in reply to Roger
            Ignored
            says:

            Where does stability come from?Report

          • Avatar Tom Van Dyke in reply to Roger
            Ignored
            says:

            Roger, just correcting a tangent and an unwarranted attack. Conservatives have no use for this entire inequality discussion:

            The central conservative truth is that it is culture, not politics, that determines the success of a society. The central liberal truth is that politics can change a culture and save it from itself.
            —Daniel Patrick Moynihan

            The conservative believes that our society is set up fairly enough already to enable opportunity and the doorway to equality. Finish high school, don’t have children without marriage and the poverty rates plummet.

            http://capitalismmagazine.com/2005/05/how-not-to-be-poor/

            The politics part of Moynihan’s quote becomes largely not a factor.

            Now we can litigate the history of the Civil Rights Movement, and indeed that’s where Moynihan’s quote achieves its relevance. Opportunity was NOT equal before the politics of the Civil Rights Act, etc., of the 1960s. But this was 50 years ago, the laws are in place, politics has had its day. Now it’s a question of society getting its act together.

            Now we can throw racism and the whole roster of anti-conservative screed into an undifferentiated soup called “inequality,” but I don’t think that’s really the topic here, of your post or of the symposium.

            As for your question of prosperity, I suppose that’s the non-left argument, that CEOs will get paid off the scale, but they create prosperity for all, so that’s the price of doing business. Society’s concern is not that some have too much, only that everybody gets enough.Report

            • Avatar Roger in reply to Tom Van Dyke
              Ignored
              says:

              TVD,

              I think you will prefer my next contribution to the discussion then. I strongly support the influence of these three cultural factors you mention in contributing to problems with class mobility.Report

            • Avatar Kazzy in reply to Tom Van Dyke
              Ignored
              says:

              Tom-

              It is simply false to say that conservatives have no use for discussions about inequality. They simply have a different perspective, different feelings, and different responses to the reality of inequality. But in your own statement, you make clear that there does exist a conservative perspective, conservative feelings, and conservative responses to inequality. Mind you, this is neither a good thing nor a bad thing… it is only a thing. The wide variety of perspectives, feelings, and responses to realities of our world such as inequality are going to be integral to finding the appropriate perspective, feeling, and response. Conservatives, just like us all, have a use for such conversations. They just might seek to have them in a very different manner. But they still have a use for them no less.Report

              • Avatar Tom Van Dyke in reply to Kazzy
                Ignored
                says:

                Thx for the fair reading, Kazzy. I agree, this is the prism through which conservatives view the issue in 2012, far more social than political, more cultural than economic. I just wanted to set the record straight so that if people want to punk conservatism, they’re punking the genuine article and not a caricature.

                Conservatives cry at Scrooge’s conversion in A Christmas Carol the same as normal people.Report

              • Avatar M.A. in reply to Tom Van Dyke
                Ignored
                says:

                Conservatives cry at Scrooge’s conversion in A Christmas Carol the same as normal people.

                The difference is, Scrooge mended his ways.Report

              • Avatar Stillwater in reply to Tom Van Dyke
                Ignored
                says:

                Tom, If you t refrain from justifying your views on specific topics and instead resort to a ‘it’s just the way we feel about things’, the caricature and the real deal collapse.Report

              • Avatar Tom Van Dyke in reply to Stillwater
                Ignored
                says:

                It was a point of order, Mr. Still. Now I relinquish the floor. You and this M.A. person can talk with each other.Report

              • Avatar Kazzy in reply to Tom Van Dyke
                Ignored
                says:

                Tom-

                I always give a fair reading. Or at least intend to.

                Viewing inequality as a function of social culture, which in tirn can be addressed through social, is a perspective worth considering. Are you authoring?Report

              • Avatar Tom Van Dyke in reply to Kazzy
                Ignored
                says:

                No, Kaz. I don’t know if I can top Moynihan and it looks like Roger has a Part Deux coming anyway. The routine slag on conservatives rubbed me the wrong way is all, and perhaps people won’t ruin every fishing post in the symposium with that stuff. It’s fine to reject the conservative worldview, but not fine to demonize it.

                Wm. F. Buckley found extreme CEO pay aesthetically disgusting and I’m not pleased either, but I consider any political means to rectify the problem [if it really is one] to be even more unappealing.

                As a side note, I find it interesting that Bill Gates gets the fish-eye from very few on the left. The Nation fawns over him. I think it’s because, per Adam Smith’s Theory of Moral Sentiments, they approve of his causes. Wealth inequality, then, is not inherently bad; it’s only bad when we do not approve of those who hold the wealth.Report

              • Avatar Kazzy in reply to Tom Van Dyke
                Ignored
                says:

                See my comment below. Pay disparities, and their likely result, income inequality are not inherently bad. But, should they lead to bad, they should be carefully looked at.Report

              • Avatar Tom Van Dyke in reply to Tom Van Dyke
                Ignored
                says:

                I’m not really following the discussion below, Kaz; the signal-to-noise ratio is prohibitive. I see you wrote

                I don’t see disparities, even great disparities, in pay between those on the top and those on the bottom as inherently problematic. What I see as problematic is when such disparities work to lessen the overall size of the pie, with the group taking the brunt of that lessening being the group least empowered to change the size of the pie and most ill-equipped to handle it shrinking.

                I’ll try to tiptoe through the cow patties as this symposium goes on, and watch for your case for the times “such disparities work to lessen the overall size of the pie,” and your Rx for those times. Peace, I’m out for the evening. I do appreciate the lack of noise on your end of the wire.

                😉Report

              • Avatar Kazzy in reply to Tom Van Dyke
                Ignored
                says:

                I will say this: I’m not going to pretend to have answers for what to do. Only that a long and careful look should be given. ESPECIALLY if the initial offering is that we shouldn’t look askew at pay disparities if such disparities can serve to grow the pie. If we accept that conceit, and I’m willing to, than it only seems natural that we MUST look askew at pay disparities if they serve to shrink the pie. And, of course, if’s all around.

                I will also say that looking askew does not necessarily mean that “SOMETHING MUST BE DONE!” As I said to fellow liberal (if he identifies as such) MA elsewhere, oftentimes the solutions to problems of income and wealth disparity are far worse than the problems themselves. To this end, I agree with you, though I probably took a different fork in the road: cultural and social shifts are what will be the biggest salve. The ones I desire are when the CEO who could justify taking 15x salary because he did work to grow the pie says, “Ya know what? I don’t need that. I’ll take 10x, disburse the rest amongst the other folks, and STILL WORK JUST AS HARD to grow the pie.” That won’t happen via legislation. It will happen because folks will decide to work for something bigger.Report

              • Avatar Kimmi in reply to Tom Van Dyke
                Ignored
                says:

                from my limited interactions with Gates, he seems like a decent guy.
                I think we ought to restructure our taxes to make guys like him more likely, not less.
                Even if he were a raging racist asshole, I’d still be pro-gates, in a “he created productivity enhancements” sort of way.Report

            • Avatar Jeff in reply to Tom Van Dyke
              Ignored
              says:

              “CEOs will get paid off the scale, but they create prosperity for all”

              Trickle-down lives!!! What the heck do we have to do to kill this zombie economics theory?Report

    • Avatar Mike Dwyer in reply to North
      Ignored
      says:

      “Culturally the conservatives (and Tea Party) are even more zero sum. They view the increase of liberty for others (women, minorities, gays) as resulting in a loss of liberty for themselves…”

      I’m going to have to disagree with this one. When you say ‘increase of liberty’ I don’t think the majority of conservatives oppose more rights for women, minorities and gays so long as the end-goal is a fair equality. That means affirmative action is out because we see it as unfair.

      The one exception of course is gay mariage and that opposition is because of a perceived harm (or potential for harm) – not because of sum imagined zero sum loss.Report

      • Avatar North in reply to Mike Dwyer
        Ignored
        says:

        Well I’m personally with you on affirmative action. So we can agree on that at least.Report

      • Avatar Kimmi in reply to Mike Dwyer
        Ignored
        says:

        it’s a real harm alright. people don’t stop and think who it is a real harm to:
        closeted homosexuals, who get through their life by remidning themselves how sinful they are.

        Now, think back to everyone you know who thinks that gay marriage might harm their marriage.

        Yup. closeted.

        America has much more of teh gayz than Asian countries. You don’t see much bitching over there about gay marriage.Report

        • Avatar Murali in reply to Kimmi
          Ignored
          says:

          mostly because we haven’t progressed to the point where people are more willing to come out of the closet. Think of the difference like this. Even in th more conservative places in the US, when a person feels that he may be thrown out for being gay, there is at least a superficial consciousness about the issue. A lot of Asian societies are so conservative (with the notable exception of Thailand) that many parents don’t even consider the possibility that their children may be gay.Report

  2. Avatar A Teacher
    Ignored
    says:

    The only problem is that it fails to address the elephant in the room.

    Company A makes $400 dollars this year. The CEO takes $380 and puts it in his pocket giving the remaining 40 employees $0.50 each.

    Or, the CEO puts $100 in his pocket and gives each employee $7.50. He still makes an obscene amount of money compared to them, but they end up making 15 times as much.

    I think that the “solution” of telling those 40 people to just “do more to grow the pie” overlooks that neither Zero Sum ~Nor~ Positive sum paint a complete picture.Report

    • Avatar North in reply to A Teacher
      Ignored
      says:

      Two objections from me to this.

      First you’re being badly hyperbolic. There have been some utterly loathsome CEO’s out there, one’s who’ve wrecked companies while paying themselves handsomely for instance or ones who’ve collected astonishing paychecks for unastonishing performance. That said, however, I’m unaware of any CEO that has been able to pay themselves 95% of the company’s profits (your first example) or 25% of the company’s profits (your second).

      My second objection is that this is a specific complaint against what Roger has put up which is a very vague and general philosophy (and I’ll agree a somewhat non-useful once because it’s so general). Roger can just answer that CEO pay is an agency problem, not in keeping with his premise and be done with it.Report

    • Avatar DensityDuck in reply to A Teacher
      Ignored
      says:

      The question I ask in response is, “what can the employees do with that fifty cents?” What if that fifty cents can buy a house and a car and pizza every night and an iPhone? “But! But the CEO has more! The CEO has more!” Yeah, so what? I got plenty myself. Once him having $380 stops my fifty cents buying all that stuff, then you’ll be getting somewhere.Report

      • Avatar Shannon's Mouse in reply to DensityDuck
        Ignored
        says:

        Reason #244 for Why I No Longer Consider Myself a Libertarian:

        “Bread and circuses for the poor are cheaper than ever.”

        It’s becoming pretty clear that $.50 doesn’t buy suitable access to health care and an education that would allow one’s kids to make more than $.50. And seeing all these people getting foreclosed on, it’s pretty clear that $.50 doesn’t buy a house, either.Report

        • Avatar DensityDuck in reply to Shannon's Mouse
          Ignored
          says:

          If your answer is “no, fifty cents is not enough money to live on”, then that’s a valid viewpoint.

          The answer is not necessarily “take all the CEO’s money”, though. “Ask for a raise” is one alternative. So is “find another job”.Report

          • Avatar M.A. in reply to DensityDuck
            Ignored
            says:

            I’ll feed the duck-billed troll once today. Wouldn’t do to let him starve, that would be mean of me.

            “Ask for a raise” is one alternative.

            We’re moving ever closer to a corporate serfdom, if we’re not there already. “Ask for a raise” is a great way to get targeted for a pink slip, especially if you’re in a “right to work” (read: right to abuse) state.

            So is “find another job”.

            Great, if you can find one. Noticed yet how things look out there? A lot of applicants for few jobs. Positions constantly being downshifted into “contract without benefits” or “overtime exempt, with 15+ hours of unpaid overtime every week” and workers who object to worsening conditions that come while the parasite class up top reaps the “positive sum” rewards? TPoFYIGM standard response, “find another job.”Report

    • Avatar James Hanley in reply to A Teacher
      Ignored
      says:

      I think Teacher has illustrated zer-sum thinking in spades. Somehow we’re just supposed to know that this distribution of earnings is wrong even though there’s no explanation for why it is. And in his snark about people with only fifty cents not being able to gore the pie he doesn’t take time to consider what the CEO does with his $380, which either gets spent or invested, both of which will have positive economic effects which can help grow the pie.

      Would the workers hanging more to spend or invest also help grow the pie? Sure. The point is not that CEO spending/investing is better, but that it’s also not worse.Report

      • Avatar Shannon's Mouse in reply to James Hanley
        Ignored
        says:

        Not worse? It’s not clear to me that the economic effects of a CEO spending his $380 on luxury consumption goods as part of a status competition with other CEOs are equivalent to the economic effects of the workers’ consumption.Report

        • Avatar James Hanley in reply to Shannon's Mouse
          Ignored
          says:

          Mouse,

          Nor is it clear that it isn’t. Each person’s spending (or investing) puts the money back into the economy. It may be the case that different goods have different multiplier effects, but I don’t know of any evidence that luxury goods in general have lower multiplier effects. And let’s note that much of the middle and lower classes’ spending is technically luxury goods. I bought a bunch of plants at the garden shop recently…luxury. My blue collar neighbor loves to buy knickknacks to decorate her home…luxury. Do those purchases stimulate the economy more than the purchase of a yacht or a Cadillac Escalade? Maybe, maybe not. Who among us has persuasive evidence one way or the other?Report

          • Avatar M.A. in reply to James Hanley
            Ignored
            says:

            I invite you to watch the Nick Hanauer TED Talk.

            It’s a good start.

            Small businesses create more jobs than large businesses. Their income inequalities – the gap between what the workers are making, and what the top level are making – are much more reasonable as well.

            Part of the problem is that 30 years of Republican policies have made it harder and harder to start a small business unless you’re an under-30 white male with no kids and no medical PECs. Meanwhile constant market “deregulation” has made it so that in many industries it’s impossible for a new startup to get past the entry hurdles created by monopolists, while small businesses that do hit a certain point are bought out by multinational conglomerates, raped for IP or recipes, and then the local jobs destroyed.

            We can keep trying to encourage small businesses to start through loans, but much more effective would be to re-enact a lot of the regulations that made it feasible for small businesses to get started and compete with the monopolists in the first place.Report

          • Avatar A Teacher in reply to James Hanley
            Ignored
            says:

            Not me.

            I’m just saying that I find the whole “Just grow the pie” solution to economic problems to be a laughable disregard for reality. There ~are~ aspects of life which are Zero Sum. I have X hours in a day. If I spend 10 minutes on LoG stuff, that’s 10 minutes I’m not, say, writing my next novel. If I spend 30 minutes on mindless chat rooms, that’s 30 minutes lost from answering fan email (unless there are fans in the chat rooms).

            Are there cases where a CEO pockets 95% of a corporations earnings? God I hope not. But many of the complaints of the OWS people (among the few complaints I agreed with) were about the difference in CEO salary and average employee salary. I don’t care what is done with the money and I won’t even ~start~ to discuss the ethics of it. I just wanted to point out that Zero Sum is very applicable in many conversations about equality.Report

            • Avatar M.A. in reply to A Teacher
              Ignored
              says:

              Let’s put it in simpler terms.

              When a CEO getting $1 million less in income could keep another 150 employees on full salary/benefits, and barely make a dent in the CEO’s lifestyle, something is absolutely morally wrong with the current system.Report

              • Avatar Jaybird in reply to M.A.
                Ignored
                says:

                That’s $6666.67 per employee. Of course, it’s *NOT* chickenfeed.

                There are, indeed, people in India for whom $6666.67/year would improve their lives substantially… indeed, substantially more than it would improve the lives of the middle class in America.

                Would it be better to send that $6666.67/year to 150 people in India?Report

              • Avatar Morat20 in reply to Jaybird
                Ignored
                says:

                I dunno, are they working for the company in question?

                Or are we jumping to the end of a slippery slope? Are we going to just stretch things out to ridiculous lengths and then conclude the entirety is ridiculous?

                Because that doesn’t feel like an honest conversation, but more like someone trying to obscure things.

                I look around a world where I’m told I can’t have raises, because I have to compete with India. But my top management takes home massive bonuses — apparently they don’t have to compete with India. And I think “if money is fungible, then ergo my CEO’s quarterly 7-figure bonus could have instead been paid as increases in wages, and the company’s bottom line and profitability would have been exactly the same”.

                Which is, I guess, why I’m in a position where I could be outsourced to India and my boss gets 7 figure bonuses. Obviously I’m not a big picture guy. Not productive. Not a team player.

                And then I get told I shouldn’t even WANT a raise, I should be grateful how much better off I am than my parents (I’m not, actually, but okay) and that I don’t live in 1662 and didn’t die of an infection, which makes me richer than Midas. (My boss, of course, also didn’t die of dystentary. On the other hand, I have an iPod. Truly, I am the wealthiest of men).

                And now, apparently, even wanting a raise means that if I don’t want to be a screaming hyporcrite I have to give all my money to a guy in India. Who, I guess, also took my job.

                But on the other hand, my boss’s bonus is even bigger this quarter and I still have an iPod. I won’t ever be able to replace it if it breaks, but I am still richer than Midas.

                And surely the newly rich Indians, with their hundreds of dollars a year in income, will be able to buy enough things to keep the company I just got laid off from in businesss and keep my bosses’ bonuses rolling.

                And if I had 25 bucks, I could buy a new CD for my iPod. But even uncharged, unloaded with music while I sit here trying to figure out how on earth I ended up with no job, I am still lucky to be an American and richer than Midas — as owning that iPod proves.

                I, thankfully, can’t have my job outsourced at the moment and it’s not for many, many levels up the heirchary that my bosses start getting large bonuses, but the point still remains:

                Why on Earth would you bring in people who don’t work for the company into the equation?Report

              • Avatar Jaybird in reply to Morat20
                Ignored
                says:

                I guess it’s an issue of my seeing how the deck is being stacked.

                “Look at those guys! They’re so much richer than I am!”

                “Look at those guys you’re so much richer than.”

                “Why in the heck would you even bring them up?”Report

              • Avatar Jesse Ewiak in reply to Jaybird
                Ignored
                says:

                So, in other words, talking about inequality in America is just bitching to you until we’re living in mud huts?Report

              • Avatar Kimmi in reply to M.A.
                Ignored
                says:

                That’s roughly half the salary of middle class in puerto rico, jay.Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                MA,

                As has been pointed out already, you guys are all ear deep in the zero sum fallacy.

                You are making the assumption that a corporation has X dollars in compensation or allowable costs and is then distributing this cost somehow.

                The worker does not compete with the manager for a share of the goodies. He cooperates with the manger in the creation of the goodies. The salary paid for the manager is determined by the forces of supply and demand in competition with other potential managers and other firms interested in this skill. The salary for the worker is similarly determined based upon demand at other firms in competition with other potential workers.

                In general workers compete with other workers, and cooperate with their employers. Similarly firms compete with each other for the privilege of cooperating with the consumer.

                When firms save on management costs, or stationary costs, for that matter, they don’t increase their budgets on workers or pencils.

                There is indeed a zero sum game within the larger positive sum game. The competition is between prospective employees. That is why I referred to unions as exploitative. They rig the game against other prospective employees.

                By the way, I suspect CEOs are playing unfairly, and to the extent this is correct, I find their practice unacceptable. I could be wrong though.Report

              • Avatar Morat20 in reply to Roger
                Ignored
                says:

                I’ll happily stipulate that in a perfect world, filled with perfectly rational people who work with the long-term in mind, where relocation and changing jobs was frictionless, and information was symmetrically distributed….

                you’d have a point.

                We don’t live in that one, though.Report

              • Avatar Kazzy in reply to Roger
                Ignored
                says:

                Roger-

                The issue, as it seems to me, is that it is highly unlikely that the $380/$.50 split is the salary structure most likely to lead to growing the pie. The issue is that folks enter such a scenario with a bevy of different, sometimes competing incentives. It is easy to point at the folks on the bottom and say, “They just want more! Why don’t they work to create more?” Why don’t we point at the man on top saying, “He just took more! But he didn’t work to create more!”

                I don’t see disparities, even great disparities, in pay between those on the top and those on the bottom as inherently problematic. What I see as problematic is when such disparities work to lessen the overall size of the pie, with the group taking the brunt of that lessening being the group least empowered to change the size of the pie and most ill-equipped to handle it shrinking.Report

              • Avatar M.A. in reply to Roger
                Ignored
                says:

                The worker does not compete with the manager for a share of the goodies.

                By the way, I suspect CEOs are playing unfairly, and to the extent this is correct, I find their practice unacceptable.

                The CEOs are management. And that’s the sound of your dishonesty hitting the alarm bell yet again. This is why dealing with you is pointless; you repeat the same tired rhetoric over and over, while making false arguments.

                You are making the assumption that a corporation has X dollars in compensation or allowable costs and is then distributing this cost somehow.

                The corporation does in fact have X dollars in profit which is then distributed in various ways (payroll, reinvestment, stock dividends, and other miscellany). It is in fact “distributing this cost somehow.” Payroll is a budget item.

                The question is: why over 30 years when profits have increased, has payroll to the top 1% expanded dramatically, but yet payroll to the rest of the workers not increased at all?Report

              • Avatar Kimmi in reply to Roger
                Ignored
                says:

                I do more than suspect CEOs are playing unfairly. they’ve formed a cabal that protects its own.Report

              • Avatar Kimmi in reply to Roger
                Ignored
                says:

                CEOs in America routinely make 10, 100 times what CEOs in other countries make.Report

              • Avatar A Teacher in reply to Roger
                Ignored
                says:

                I’m sorry.. I don’t see the fallacy.

                I’m a math guy so maybe you need to use some numbers to splain this to me. All I ~do~ know about economics is this:

                Company has X dollars in profit. Of X they can divide that sum into groups such as “Employee Compensation”, “Material Investments”, “Cash Investments”. Etc. But at the end if they are actually balancing their books, the sum of ALL of those still has to be X. Which means, if they buy more machines, they have less for cash investments. If they pay one guy more, that’s that much less then they have to pay someone else.

                Grow the pie all you like but at the end of ~each~ year there’s still the single value called “Revenue” that they get to allocate around as they see fit as “Expenses” hopefully with E < R.

                I get growing the pie. I get reinvesting. What you don't get is that we aren't looking at growing the pie. We're looking at company profits.Report

              • Avatar Roger in reply to A Teacher
                Ignored
                says:

                Teacher, Kazzy, Morat, Kimmi and MA

                As I mentioned, I too suspect CEOs are manipulating the system to their advantage. But this would require a whole different post. Let’s just agree to agree for a change.
                FISH THE CEOS!

                That is why I shifted the discussion to management in general. Let’s call it the AVP in charge of Marketing Research. This persons salary is set by supply and demand. If the company tries to pay him less than his going rate, let’s call it $350,000 a year, then he is at risk of leaving to another company. Of course their are lots of Senior Directors at various firms that would love to do his work for less. Where these all balance out is what the firm pays.

                The same is true for all the sales reps in the AVPs division. Where supply meets demand, imperfectly, that is where firms will set their salaries. It makes no sense for them to impose a lower salary on the AVP to get a higher salary for all the sales reps.

                They also cannot arbitrarily increase their prices to offset higher sales rep salaries. The reason is that the price of their product is set by supply and demand too. Nor can they arbitrarily lower profit margins. Doing so will lead to penalization by the stockholders, in terms of share price, which is also set by supply and demand.

                I am stating all this based upon my experience actually involved in the setting of wages, salaries, commissions and prices. These are not theoretical issues. They are the exact issues that we dealt with and stumbled through in running businesses.

                Furthermore, if the AVP’s all got together and decided to donate half their salary to the sales rep salary fund, the result would actually be an inefficiency in the sales rep supply and demand. Let’s say they could double the hourly wage. The result would be a surplus of people wanting that job. After all the going rate is half that amount. This means that those that missed out on the job would offer their sevices for just under the double amount. Pretty soon, the company would either have to deny the job to those hungry candidates (which is unfair to THEM), or they would just lower it to the point supply meets demand.Report

              • Avatar Troublesome Frog in reply to Roger
                Ignored
                says:

                The same is true for all the sales reps in the AVPs division. Where supply meets demand, imperfectly, that is where firms will set their salaries. It makes no sense for them to impose a lower salary on the AVP to get a higher salary for all the sales reps.

                I think that what Teacher is referring to what we would call an income effect if it was a utility maximizing consumer and not a cost minimizing business. If the business is budget constrained and trying to maximize output for a given budget, I’d say that’s an accurate model. If the business is trying to minimize cost at a fixed level of output, it’s not. Assuming the reduction in AVP cost makes the organization noticeably more profitable, I wouldn’t be surprised if they scaled up rather than simply paying extra dividends, but that’s an assumption.

                I’m not sure what you mean in the second part of your post. It sounds like you’re suggesting that a reduction in the cost of AVPs would cause some sort of artificial surplus of sales reps. I’m not seeing it. It seems to me that if somebody gives you a pile of money and says, “Use all of this to hire sales reps,” demand for sales reps would shift right and increase sales rep wages and the number of sales reps. The market should clear just fine at the higher wage level.

                If they had said, “Use this to hire sales reps at a fixed price of $1M per year,” then you’d certainly get a surplus, but that’s just assuming that it’s a price floor and not extra money. That’s not really how it would work.Report

      • Avatar dexter in reply to James Hanley
        Ignored
        says:

        Mr. Hanley, “consider what the CEO does with his $380, which either gets spent or invested, both of which will have positive economic effects which can help grow the pie” is true only if the CEO is investing in things that help. There is a huge difference between venture capitalism and vulture capitalism. Consider buying oil futures that you hold only long enough to make a profit or building a plant in Kansas. Which has a better effect for a blue collar worker in Kansas. I just read where the average stock is held for 22 seconds. How does that help the middle class?
        You buying plants does more for the economy than your neighbor buying knick knacks because your plants were probably made in America where the neighbor’s stuff has a large chance of being made in another country which sends most of the profit and the taxes on that profit elsewhere.Report

        • Avatar Patrick Cahalan in reply to dexter
          Ignored
          says:

          > I just read where the average stock is held for 22 seconds.
          > How does that help the middle class?

          That depends on what percentage of micro-trades is executed on behalf of investment vehicles like mutual funds or 401k programs vs. large individual investors.

          I have no idea, myself.Report

        • Avatar Plinko in reply to dexter
          Ignored
          says:

          But dexter, if you’re not a party to the transaction, why do you care what someone else trades?

          If someone has a piece of paper and someone else has $10 and they trade those things, why do you care?

          Isn’t the onus on you to explain who is hurt and how?Report

          • Avatar dexter in reply to Plinko
            Ignored
            says:

            Plinko, If investor A has a piece of paper saying he has x barrels of oil and holds it until refinery Z buys it for more than A paid for it then gas cost me more and I am losing. From my left wing perspective there is too much money in too few hands chasing too high a profit.Report

            • Avatar Plinko in reply to dexter
              Ignored
              says:

              The oil producer, investor and refinery are divvying up the difference between the cost of extracting the oil and the price the service station owner pays for the gasoline he’ll sell you later (at what’s most likely a still higher price).

              If the refiner is willing to pay more, the investor is taking money the producer could have had, not raising the price you pay. The producer sold those warrants to the investor because it wanted a certain amount of money now rather than a less-certain amount later.
              If the refiner could get the oil more cheaply by buying directly from the producer, they would just do so, if they’re buying the delivery of the oil in the warrant, it’s because it’s the best deal they think they can get.Report

        • Avatar Gorgias in reply to dexter
          Ignored
          says:

          Oil futures help the market come to the best prediction for future prices of Oil, which is necessary for the market to work efficiently.Report

          • Avatar M.A. in reply to Gorgias
            Ignored
            says:

            Oil futures unnecessarily raise the price of oil, thus making the market work less efficiently and harming the lower classes more than the upper classes.Report

            • Avatar James Hanley in reply to M.A.
              Ignored
              says:

              M.A.,

              Joe Kennedy doesn’t have any idea what he’s talking about. Here’s a note from the Federal Reserve explaining how market fundamentals caused the increases in oil prices.Report

              • Avatar James Hanley in reply to M.A.
                Ignored
                says:

                M.A., just what the fish do you mean “ghostwritten by lobbyists?”

                The classic response to an insinuation like that is “prove it or STFU.” Seriously, what’s your evidence that the source I linked to was written by lobbyists? Just that you don’t like the conclusions?

                I mean you could have just said, “here’s another Fed paper that suggests differently,” and you would have sounded like a decent person. Instead you went out of your way to make yourself look like an asshole.

                As to the link you cited, please note that it says speculation played a significant role in prices between ’04 and ’08, but that “The increase in oil prices over the last decade is mainly driven by the strength of global demand.” So even your source agrees that market fundamentals are the main part of the story.

                Good source, though. If you’d done it without the dishonesty, it would have been perfect.Report

              • Avatar BlaiseP in reply to James Hanley
                Ignored
                says:

                The oil futures market is led about by a ring in its nose by a collection of fearful little speculators who pretend to be bolted in to the private dealings of the House of Saud and the Emir of Kuwait. That’s the reality. Anyone who says otherwise is either lying or an idiot and certainly knows nothing about the oil futures market.Report

              • Avatar Kimmi in reply to James Hanley
                Ignored
                says:

                calling him dishonest is a low blow. not perhaps thatM.A. has any room to talk, but I’ll call it ungentlemanly.Report

              • Avatar BlaiseP in reply to Kimmi
                Ignored
                says:

                Since the mid-1970s, is there there any doubt the price of oil has been set by private agreements and not the futures market? Let’s see who says otherwise.Report

              • Avatar James Hanley in reply to Kimmi
                Ignored
                says:

                Kimmi,

                He implied that the article I linked to was written by lobbyists, even though he has not one shred of evidence that it is. That is dishonest, no ifs and or buts.

                If I suggested the article he linked to was written by someone who’s secretly a socialist, it would be the same kind of thing, and just as dishonest.

                I’m all for robust vigorous kick-ass and take no prisoners debate. What I’m against is dishonesty.Report

              • Avatar James Hanley in reply to Kimmi
                Ignored
                says:

                Blaise,

                Doesn’t the futures market count as private agreements? I think you’re using the term differently, but I’m not sure just what you mean.

                If you mean private agreements among OPEC countries, I’d agree that’s a large part of the story (although it’s also been set at times by the failure of those agreements).Report

              • Avatar BlaiseP in reply to Kimmi
                Ignored
                says:

                No, James. It’s not a private contract. It’s conducted with an intermediary with a performance bond, say NYMEX.

                There’s no real market in petroleum, any more than there is in diamonds or any other cartel-controlled commodity. The Dallas Fed would love to pretend otherwise but the Invisible Hand sometimes uncloaks like a Klingon Bird of Prey, right in front of the ol’ Starship Free Enterprise, much to the dismay and cornfuzion of these Fudgeration Orificers.Report

              • Avatar James Hanley in reply to Kimmi
                Ignored
                says:

                Blaise,

                You didn’t really answer my question, which was what do you mean by “private agreements”? I’m not critiquing, just trying to understand.Report

              • Avatar Kimmi in reply to Kimmi
                Ignored
                says:

                James,
                I think at maximum Blaize means oligopoly, and at minimum a very opaque market with price fixing cartels.Report

              • Avatar BlaiseP in reply to Kimmi
                Ignored
                says:

                I have answered your question. There are three, not two parties to a futures contract. Furthermore, the price of that contract is public, for all to see. Thus a futures contract is not a private transaction by any definition. Just stop with trying to make the buyer and seller into private entities. They are not.

                When the House of Saud sits down to decide how much oil to pump, they control the supply. They turn the spigots on and off as they see fit and nobody knows their minds. That’s private.

                The Oil Futures Astrologers would tell us of that huge stage that presenteth nought but shows whereon the Saudi Stars in secret influence comment. These know-nothings are everywhere. Let Ahmedinejad fart out of key and these Oil Astrologers will run up the price of oil in no time flat. Rumours and gossip, not market fundamentals run that market. Homey don’t play dat. Now some of my friends do, but they have the patience and wit to deal with these little market panics and groundless enthusiasms. Me, I play a long game.

                So when the Dallas Fed says speculators aren’t in control of those markets, I call bullshit. I know better and I’m pretty sure you do too: he who controls the supply controls the price. The Saudis have every reason to keep the West from collapsing in shit and ruin: we are their defenders in a nasty part of the planet and those friendships run deep. But not even the Saudis can control these Oil Astrologers on NYMEX. Stupidity and hydrogen are the two most abundant commodities in the universe and for my money, stupidity is the more durable and reliable.Report

        • Avatar Kimmi in reply to dexter
          Ignored
          says:

          Do you not understand the value of arbitrage?Report

    • Avatar Mike Dwyer in reply to A Teacher
      Ignored
      says:

      “Company A makes $400 dollars this year. The CEO takes $380 and puts it in his pocket giving the remaining 40 employees $0.50 each.”

      So then the employees take their value (their skills) and go somewhere else. Employment is a voluntary contract.Report

      • Avatar M.A. in reply to Mike Dwyer
        Ignored
        says:

        Where else do you suggest? Looked at the employment market lately? Looked at the real, actual barriers to starting your own business lately?

        “You’re free to look for other work” is a great libertarian catcall in the FYIGM serfdom environment we’re in, but all it does is prove libertarians are out of touch with reality.Report

        • Avatar Mike Dwyer in reply to M.A.
          Ignored
          says:

          Job mobility is exactly equivelant to the marketability of the worker. And is $0.50 better than $.00?Report

        • Avatar James Hanley in reply to M.A.
          Ignored
          says:

          Hey, M.A., can you stop this FYIGM business? Seriously. That’s not what we libertarians are all about, and you repeating it all the time doesn’t make it so; it just makes you look like someone who wants to come here and spew, rather than someone who wants to come here and have a conversation.

          I guess I could say liberals are all about FYIWY (Fish you, I want yours), but I’m pretty sure you’d recognize that’s not true and that it doesn’t get us anywhere.Report

          • Avatar M.A. in reply to James Hanley
            Ignored
            says:

            I’ll stop referencing it when it stops being true, but it’s still true. I have yet to see a libertarian argument regarding income inequality that amounts to anything more positive than a shrug and a statement to the effect that it would be “wrong to use the coercive force of government” to fix the worst societal problem of our era.

            Instead, libertarians wholly support the completely asymmetrical coercive economic force exerted by a class of less than 400 people who control more than half the nation’s wealth in preventing the societal problem from being addressed.

            When that sort of asymmetry exists, it becomes a pseudo-governmental force on its own. It ought to be something libertarians opposed vehemently, but they’re too blinded by animus to “government” and a worship of the deregulatory economic masturbation-fest started in the 1980s to pay attention to that entirely evident reality.Report

            • Avatar A Teacher in reply to M.A.
              Ignored
              says:

              In all of that there is a valuable point that gets lost:

              “Psuedo-governmental force on its own”.

              We can talk about who provides cohercive pushes and pulls and the affect they have on various groups. And the ups and downs and who controls who and what. But I think that things like:
              “Dont like it? Move.”
              “Dont like it? Get a different job.”
              “Don’t like it? Start your own business.”
              “Don’t like it? Vote someone else into office.”

              are just rhetorical conversation stoppers. They’re the intellectual equivalent of Fish You and your Cat. Reality is that nothing is as easy as people want it to be in the abstract.Report

            • Avatar James Hanley in reply to M.A.
              Ignored
              says:

              I’ll stop referencing it when it stops being true, but it’s still true.

              So you really think that you can tell me what I really believe?

              Really?Report

            • Avatar Stillwater in reply to M.A.
              Ignored
              says:

              MA, I don’t expect this will mean much, but I’ve been down the very same road as you’re on with Hanley, and Roger, and Jason Kuznicki, and Jaybird, and all the other libertarians on this site, and I can tell you that they are not FYIGM types. That’s not to say that there aren’t libertarians roaming the wilds who are like that (there are), but Hanley and the other most definitely are not.Report

      • Avatar A Teacher in reply to Mike Dwyer
        Ignored
        says:

        Which only works inasmuch as there aren’t a bunch of CEO’s hanging out at the yacht club discussing how $0.50 is such a good wage and they should all offer it.

        Also as long as hat $380 goes to off shore bank accounts to sit and shore up estates, it’s not circulating in the economy and one could argue, effectively I think, that it’s doing more harm to the economy than if it were in the hands of a wider number of people ~using~ it.Report

  3. Avatar reflectionephemeral
    Ignored
    says:

    I don’t think that’s a fair characterization of what progressives think. I think progressive concern with inequality is rising because inequality is rising, not because economic growth is a zero-sum competition.

    The US has among the lowest social mobility in the OECD; the bottom 4 quintiles have seen roughly no wage growth over the last thirty years; the financial industry has been deregulated and has boomed, but as Paul Volcker put it a few years ago, “I wish someone would give me one shred of neutral evidence that financial innovation has led to economic growth — one shred of evidence”, before concluding that the only worthwhile financial innovation of the past twenty years was the ATM.

    As far as I can see, everyone in the Democratic Party thinks that capitalism is a great force for good. We’ve changed the rules in the last 30 years in a way that doesn’t seem to have worked all that well, progressives note, so we should see what we can do to address growing inequality, and weak social mobility.

    I think it’s a more narrow & practical concern than the cosmic perspective you offer in this post.Report

    • Avatar DensityDuck in reply to reflectionephemeral
      Ignored
      says:

      The thing is, though, that “inequality” is only a meaningful criticism in a zero-sum game. If the amount of wealth is always increasing, then the response to “I want more pizza but Joe always grabs a second slice!” is to order the Extra-Large next time.Report

      • Worsening inequality vs. previous time periods isn’t a concern that the game is zero-sum; it’s a concern that the rules of the game have changed, in a way that doesn’t seem to work. Remember, we have worse social mobility than most comparable countries.

        As Jonathan Chait pointed out a while back:

        a child born into the lowest-earning quintile who manages to attain a college degree is less likely to be in the highest-earning quintile than a child born into the top quintile who does not attain a college degree. This is all the more remarkable when you consider that making it to, and through, college is far harder for poor kids than rich kids even at a given level of aptitude. (Two thirds of the kids with average math scores and low-income parents do not attend college, while almost two-thirds of high-income kids with average math scores do.)

        So our worsening inequality problem & concurrent mobility problem is destroying social capital. Talented people with poor parents are less likely to have a chance to become inventors & entrepreneurs & whatnot, which makes us all worse off.Report

        • Avatar James Hanley in reply to reflectionephemeral
          Ignored
          says:

          This doesn’t follow at all. It’ always been harder for the children of the poor to succeed–that’s not something new. And widening inequality can occur while the least well off are becoming better off. That’s the important insight of the positive sum view. Bill Gates’s wealth continues to increase at a much faster rate than mine, but mine still continues to increase,albeit slowly. Why should I worry about that increasing disparity as long as my position keeps improving?Report

          • Why should I worry about that increasing disparity as long as my position keeps improving?

            If indeed your position keeps improving, that’s definitely a good thing. But Benjamin Friedman argued in “The Moral Consequences of Economic Growth,” people have as their frame of reference what’s going on around them now, not how people lived 30 years ago.

            And if we have indeed changed the rules in the last 30 years such that more of the gains go to a few hundred households in ways that don’t seem to increase growth overall, we should look into the benefits of the rules in other countries, and the rules we used to have here.Report

            • Avatar James Hanley in reply to reflectionephemeral
              Ignored
              says:

              In fact people do tend to look at current relative position, rather than absolute gains. But Tthat they do so is not evidence that it is the right way to do so. Among other problems, it is a good route to creating needless frustration and anxiety. It also breeds exactly the type of materialistic culture leftists dislike. My position is that this sort of focus is damaging, and it’ a huge mistake to focus on it. Focusing on absolute gains is superior in every way.Report

              • Well, you go into the economy with the humans you have, not the humans you wish you had.

                If we have indeed changed the rules in a way that leads to less mobility and less equality than we would have had otherwise, and we’ve gotten no benefit in terms of growth overall, it seems to me that we’d want to look into changing the rules back.Report

              • Avatar James Hanley in reply to reflectionephemeral
                Ignored
                says:

                That’s not a meaningful response. The humans we have also are ethnocentric and inclined to theft and violence. We Don’t treat that as the right way, but try to teach them to do better. The whole point of harping on absolute status is that same effort to try to teach people a better way.

                Besides, you don’t get oughtn’t from ises, right?Report

              • Avatar Snarky McSnarkSnark in reply to James Hanley
                Ignored
                says:

                I’m not sure why that should be considered a “not meaningful” response. Both laws and culture are designed to shape human behavior into more productive and pro-social directions. We disincent theft and violence by creating laws and social norms that discourage these behaviors.

                I think we all proceed from some vision of an “ideal” society. Libertarians are, on the whole, relatively unconcerned about absolute differences in prosperity. Liberals, being more concerned with issues of “distributional fairness,” as they see it, want to structure society in a way that nurtures outcomes more consistent with it. To my mind, that’s the very essence of “meaningful.”Report

              • Avatar James Hanley in reply to Snarky McSnarkSnark
                Ignored
                says:

                It was not meaningful because it said, well, that’s human nature, so it’s the right way to look at things. You’re exactly right about trying to shape brhavior into more productive directions; that’s actually just what I meant when I said that teaching people to focus on absolute well-being.Report

              • Avatar Morat20 in reply to James Hanley
                Ignored
                says:

                And communism would be awesome if it weren’t for the human element, is what you’re saying?

                You’re solving for the spheroid cow in a vaccuum, but the problem is the actual cow in front of you. Actually worse — you’ve simply hand-waved away the critical detail. Whether you like it or not, whether you think it’s right or now, that is how human beings think and how they react and how they vote and how they buy and spend.

                Ignoring THAT means you’re basically talking about a fantasy universe, and projecting those policy results onto ours. It’s a really good way to screw up.Report

              • Avatar Stillwater in reply to James Hanley
                Ignored
                says:

                Focusing on absolute gains is superior in every way.

                Suppose that at T1 there is a certain wealth distribution, income distribution, tax rate, and total societal productivity. Then, change the tax rate such that it’s increased for the middle class and lowered for the wealthy. Now suppose that at T2 the wealth and income distributions have shifted dramatically upwards even as total productivity remains the same and that in absolute terms the middle class is still better off than at T1.

                Do you find anything objectionable in that scenario?

                To repeat a bit from a previous comment: it seems to me you’re thinking of increased inequality in ceteris paribus terms. And that’s fine as far as it goes. But how far does it go?Report

              • Avatar DensityDuck in reply to Stillwater
                Ignored
                says:

                This is the part where you explain how it’s worse that the middle class is better off.

                Bonus points if you can do it without an argument that sounds like the “lost sales” arguments we hear from the RIAA.Report

              • Avatar Stillwater in reply to DensityDuck
                Ignored
                says:

                This is the part where you explain how it’s worse that the middle class is better off.

                I wouldn’t do that. It’s good that the middle class is better off, but that fact is often used as a cover to justify increases in wealth and income disparities. What’s at issue is the causes of those increases, and the argument which attempts to justify them. So, as I’ve said like 3 or 4 times on this thread, if T1 and T2 are distinguished only by the tax rate imposed on the middle class and the upper class, and at T2 the middle class enjoys real gains in wealth and income even tho they’re paying higher taxes, then the argument that absolute gains in the middle class over a specific time period becomes irrelevant (to the topic at hand).

                Or think of it this way: if absolute gains over a time frame is all that matters wrt any particular class, then why not increase taxes on the wealthy to the slimmest of margins where they’ll experience absolute gains over a time frame and radically reduce taxes on the middle class?

                If absolute gains are the only metric worth considering here, why isn’t this a viable option?Report

              • Avatar Jaybird in reply to Stillwater
                Ignored
                says:

                If we imagined how the top X% of tax payers paid Y% of Federal Income Taxes collected, what numbers for X and Y would strike you as appropriate or just or whatever?

                No googling! (I want to see if the numbers you throw out there are higher, lower, or equal to what the numbers actually are.)Report

              • Avatar DensityDuck in reply to Stillwater
                Ignored
                says:

                “if absolute gains over a time frame is all that matters wrt any particular class, then why not increase taxes on the wealthy to the slimmest of margins where they’ll experience absolute gains over a time frame and radically reduce taxes on the middle class? ”

                I dunno. Why not?

                You aren’t making a complete argument as to why we should do that.Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                I don’t have the foggiest idea. I’m not dodging! I don’t think of things that way. It’s not like I had a baseline in mind when I wrote the above comment. Rather, it was a response to the idea that absolute gains in the middle class over a time period can be used to justify increased income and wealth inequality even if the effective tax rate on the rich has gone down. I mean, that’s pretty obvious, right?Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                You aren’t making a complete argument as to why we should do that.

                It is a complete argument if the only metric that matters is absolute gain for a class over a time period.Report

              • Avatar DensityDuck in reply to Stillwater
                Ignored
                says:

                So if the middle class income goes up but not as fast as you think it ought to do then that’s going to destroy society unless corrected by taking money away from people who have more than a certain amount which you can’t quite define except by bellyfeel.Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                No. It’s that middle class gains doesn’t tell us enough. It’s not the end of the story. There are other factors that come into play.

                I don’t know how I can make it any clearer than that.Report

              • Avatar Jaybird in reply to Stillwater
                Ignored
                says:

                Well, the numbers I saw showed that the top 10% paid the top 71% of income taxes collected. (Of course, this doesn’t count stuff like FICA or Social Security or whathave you and we can discuss whether that’s particularly fair or not or, at least, acknowledge that there are real reasons to not include those.)

                The top 50% paid something like 98% of income taxes collected.

                That number is in the ballpark of my guess (my guess was 75%), for the record.Report

              • Avatar Stillwater in reply to Stillwater
                Ignored
                says:

                Nice. Here’s a breakdown of some of the whathaveyous at the Federal level:

                Individual income tax: 42%
                Payroll taxes: 40%
                Corporate income tax: 9%
                Excise taxes: 3%
                Other: 6%Report

              • Avatar Morat20 in reply to Stillwater
                Ignored
                says:

                If we imagined how the top X% of tax payers paid Y% of Federal Income Taxes collected, what numbers for X and Y would strike you as appropriate or just or whatever?

                Honestly? Sliding scale based off the percentage of overall income (including capital gains) — utility of money and all would fudge it a bit, but if the top — say — 1% took in 30% of all income, they should pay at least 30% of all taxes.

                That’s utterly flat, bare minimum. If the top 1% took in 50% of income, they should pay — minimum — 50% of taxes.

                I don’t consider that optimal, however. You need either a negative income tax or some sort of subsidy/credit system — there’s no point in making people living on poverty-level income pay anything, because it’ll cost you just as much or more to make sure they’re fed and not dying on the streets. So let’s say the first X income per person is exempt.

                After that, you’d want a marginal system (either a function or brackets) because a 10% increase in income to a guy making 30,000 a year is different in terms of real change in quality of life than a 10% gain for a man making 100,000…or one making a million.

                So in essence, if the top 1% was making 30% of the income they should probably be paying more than 30% of all taxes — simply because the fact that each marginal dollar is worth less to them than the bottom 99%.

                I believe that, right now, taxes (overall) are essentiall flat. Which means if the rich are paying an outsized seeming % of taxes, it’s because they’re receiving an outsized % of income.Report

              • Avatar Roger in reply to Stillwater
                Ignored
                says:

                You guys need to check out this link.

                http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=456

                It has income tax rates by quintile over time, as well as total Effective federal tax rates. The data shows that tax rates are going down for every quintile. The top quintile pays the highest rates overall at about 25%.Report

              • Avatar Kimmi in reply to Stillwater
                Ignored
                says:

                Roger,
                does that nice link explain how it is possible to have a 0% tax rate in America?
                ;-P
                Don’t tell me it’s not possible.Report

              • Avatar James Hanley in reply to Stillwater
                Ignored
                says:

                change the tax rate such that it’s increased for the middle class and lowered for the wealthy. Now suppose that at T2 the wealth and income distributions have shifted dramatically upwards even as total productivity remains the same and that in absolute terms the middle class is still better off than at T1.

                If I read this right, the conclusion is impossible. If total productivity remains the same cumulative wealth hasn’t increased, so raising taxes on the middle class and shifting wealth/income distributions upward would mean the middle class can’t be better off.Report

              • Avatar Stillwater in reply to James Hanley
                Ignored
                says:

                They can’t be better off at T2 relative to the previous (lower) tax regime at T1 (all other things equal), but they can still be better off at T2 in absolute terms. Think of the increased taxes as merely slowing the growth of middle class after tax income rather than moving it into negative territory.Report

            • Avatar DensityDuck in reply to reflectionephemeral
              Ignored
              says:

              “people have as their frame of reference what’s going on around them now, not how people lived 30 years ago.”

              Which is why it doesn’t matter that OWS has iPhones and college educations, because they’re worried that they might not be able to get a job and they heard about someone who had to sell their kidneys to pay for kidney surgery.Report

          • Avatar Stillwater in reply to James Hanley
            Ignored
            says:

            Why should I worry about that increasing disparity as long as my position keeps improving?

            That’s a ceteris paribus claim, no? Fact is, all other things aren’t equal. Taxes on the rich have gone down. Because of that, the increase in income disparity seen lately can be attributed in part to tinkering with tax rates. It’s sortuva a redistribution upwards (born on the backs of our children).Report

            • Avatar James Hanley in reply to Stillwater
              Ignored
              says:

              Actually, no, it’s not a ceteris paribus claim. In fact all other things don’t need to remain equal, as long as my position improves, I don’t care if others’ positions improve more.Report

        • Avatar Roger in reply to reflectionephemeral
          Ignored
          says:

          Ephemeral and various responders,

          I agree that barriers to social mobility are a problem with inequality, and am planning on writing on this. The thread then goes into the issue of relative vs absolute position.

          I would just add that the relative worldview is inherently zero sum. And there is nothing inherently incorrect in viewing it this way. Those taking this path will end up in a certain place. James points out the other path and where it ends up. I say we need to choose wisely. If life is a race, most of us are going to lose. If life is a journey, we can all thrive.

          Our world views are critical in social outcomes, and part of our socialization process includes dialogues like this.Report

          • Avatar M.A. in reply to Roger
            Ignored
            says:

            If life is a journey, we can all thrive.

            Life is a journey, but we’re not all thriving. In fact, less of us are thriving than 30 years ago, while a significantly tiny minority are thriving even more than they were 30 years ago.

            “I’d far rather be happy than right any day.”
            “And are you?”
            “No, that’s where it all falls down, of course.”
            “Pity, it sounded like quite a good lifestyle otherwise.”

            You argue that liberals/progressives view the world as a “zero sum” game. I argue that you are inherently wrong; the problem is not that interactions are seen as zero-sum, but that positive-sum benefits are apportioned in a way that creates ever-increasing gaps in purchasing and influence power. These gaps, vis-a-vis Citizens United, have become so prominent that the concept of “freedom of speech” is abridged by the ability of a very small few to shout down everyone else.

            Shannon’s Mouse, above: “Reason #244 for Why I No Longer Consider Myself a Libertarian:“Bread and circuses for the poor are cheaper than ever.””

            A rising tide that lifts all boats is meaningless if 1% of the population controls access to every pier and can decide who has permission to be on the water.Report

          • Avatar Kimmi in reply to Roger
            Ignored
            says:

            Sorry, but it’s not zero sum. If you gave me $50, I’d put it towards the middle class education– and we’d have more people getting arrested for tipping in $2 bills (Wozniak). Because the middle class makes productivity enhancements. The rich do not. It is true that middle class people can become rich through their work. These people GAIN money/prestige the MORE the MIDDLE CLASS has, in general. Because they’re good at finding things taht people wanna buy.Report

      • Avatar Stillwater in reply to DensityDuck
        Ignored
        says:

        The thing is, though, that “inequality” is only a meaningful criticism in a zero-sum game.

        I disagree here, DD. I think inequality of opportunity is a positive sum game. I also think that inequalities in determining policy (one person, one vote – that type of thing) are zero sum, but can still be justified.

        I think the area where positive sum interactions have the most traction are at the level of luxury items, where the choice to spend on item X is justified on subjective utility grounds, but that it breaks down in markets where the goods and services as they get closer to necessary or essential.Report

        • Avatar James Hanley in reply to Stillwater
          Ignored
          says:

          Still, I disagree. First, your voting example is zero sum,nso it basically supports Duck’s argument. Second, I think you’re mixing up having sufficient necessities with equality of necessities. It’ s important that everyone have adequate food and shelter, but that doesn’t mean there’s a problem with one person eating chicken in a small fixer upper while another person eats filet mignonette and caviar in their mansion.Report

          • Avatar Stillwater in reply to James Hanley
            Ignored
            says:

            The first example is zero sum: I wasn’t disagreeing but saying that there are certain situations where zero sum is the correct way to understand the process. In the second, I’m suggesting that viewing the provision of essentials as positive sum is wrong. From my pov, it’s a category error, since the provision and acquisition of essentials are no longer voluntary transactions.Report

            • Avatar Stillwater in reply to Stillwater
              Ignored
              says:

              {{{this goes back to the discussion we had long ago about sweatshops and leverage}}}Report

            • Avatar James Hanley in reply to Stillwater
              Ignored
              says:

              Ok, but I think it’s been stipulated that the issue being debated isn’t provision of essentials. Roger has repeatedly said he supports a safety net; for the record, so do I. The area of disagreement has to do with wealth beyond the essentials.Report

              • Avatar Stillwater in reply to James Hanley
                Ignored
                says:

                The area of disagreement has to do with wealth beyond the essentials.

                Then see my comment at 12:22 (currently #27).

                I think there are two issues in play right now. The first is whether there is anything inherently wrong with increased wealth/income disparities just so long as the middle class enjoys increased wealth/income in absolute terms all other things being equal. That’s in interesting topic, and probably the one you want to discuss. Frankly, I’m persuaded that on it’s own terms, those increasing disparities aren’t bad in and of themselves. The second issue is to what extent, as a matter of fact, the increasing wealth/income disparities we’ve been seeing result from a redistribution of middle class income upwards via tinkering (rather than ‘natural’ processes). (Or even if it makes sense to talk at this point about tinkering and natural processes.)

                I think the libertarian argument is conceptual: increased inequality that results from voluntary transactions is justified. I also think liberals have a real burden to meet in arguing against this view. But I also think – or tend to think – that the liberal complaint being expressed on this thread (and generally) is that increased inequality hasn’t resulted from voluntary transactions, so even if they were to concede the libertarian’s conceptual point, it doesn’t apply as an explanation or account of what’s been occurring over the last 30 years or so.Report

              • Avatar Roger in reply to Stillwater
                Ignored
                says:

                To the extent inequality has arisen via non-voluntary, or non-mutually beneficial transactions, I agree it is a problem.Report

              • Avatar Michael Drew in reply to Roger
                Ignored
                says:

                How do we go about determining that extent? Frankly, I’m a little surprised to see you suggesting our economy contains much in the way non-voluntary or non-mutually-beneficial transactions. Are you doing that? If so, where do we go to look for them?Report

              • Avatar James Hanley in reply to Michael Drew
                Ignored
                says:

                I’m a little surprised to see you suggesting our economy contains much in the way non-voluntary or non-mutually-beneficial transactions.

                And here I thought you’d been paying attention to we libertarians’ complaints about how many non-free market elements there are in our economy!Report

              • Avatar Michael Drew in reply to Michael Drew
                Ignored
                says:

                You’re right. For some reason (because Stillwater stipulated that he was talking about arguments made by liberals in these threads perhaps), I thought Roger was willing to begin to broach the subject of coercion in the economy apart from government and outright crime there. My mistake.Report

              • Avatar Morat20 in reply to Stillwater
                Ignored
                says:

                Shorter version:

                Liberals: We really don’t mind wealth. We’re all for rich people. Hooray success! However, seriously, look around. Things have kinda gone off the rails here, and we should probably address this before it gets out of hand.

                Or hey, as a note to the rich: This is unsustainable, long-term. Fix it now, or fix it when the masses revolt. You were lucky the financial industry didn’t trigger a metaphorical day of the rope towards the rich buggers who screwed the pooch, but don’t count on being lucky twice.

                Fix it now, of your own volition, or wait until the system collapses and it’s fixed for you. By angry, angry people.

                But hey, that’s just me. I see the current path is unsustainable, it’s leading towards an almost fuedal system that looks like the bad old days of the Gilded Age, and I think the American middle class is not gonna roll over and accept it. Maybe it’s all boiling frogs and they’ll accept their lot in life, but I suspect there’s a breaking point and I’d prefer not to find out. I’d rather just, you know, be a bit proactive.Report

              • Avatar M.A. in reply to Morat20
                Ignored
                says:

                The response of the 1% is Tea Party astroturfing and the right wing radio networks, with a drumbeat rhetoric that attaches morality to wealth. I’ve lost track of the number of times I’ve heard it said on the radio shows – and even here on this blog – about how “immoral” it is to “take at gunpoint” wealth in the form of taxation in order to fund programs that are “wealth transfer.”

                And by “wealth transfer” they mean adequate funding for social security, medicare, medicaid, and the rest of the safety net currently overflowing with unemployed, underemployed, and otherwise directly harmed people due to the Recession that necessarily flowed out of the last 30 years’ economic policies.

                I’d prefer the system be fixed before the Tea Party followers finally reach the conclusion that it’s unsustainable and their current loyalty to the 1% is just getting them screwed up the pooch. Enough of them are already drunken, angry rednecks with guns that it’s are likely to turn extremely violent at that breaking point.Report

              • Avatar James Hanley in reply to Stillwater
                Ignored
                says:

                The first is whether there is anything inherently wrong with increased wealth/income disparities just so long as the middle class enjoys increased wealth/income in absolute terms all other things being equal.

                I don’t think there is, and I haven’t seen a compelling argument that there is.

                The second issue is to what extent, as a matter of fact, the increasing wealth/income disparities we’ve been seeing result from a redistribution of middle class income upwards via tinkering (rather than ‘natural’ processes). (

                That is a worthwhile question. I think it’s much harder to answer than some of our liberal colleagues here seem to think it is. I think they see it happening and assume it must be the result of nefarious behavior, that it couldn’t possibly be the result of legitimate processes. I think they beg the question, though.Report

            • Avatar Roger in reply to Stillwater
              Ignored
              says:

              SW and James,

              I am not following you guys. How are the provision of essentials not a positive sum process?Report

      • Avatar Troublesome Frog in reply to DensityDuck
        Ignored
        says:

        (Delurking after a long time… Hi everybody.)

        I don’t think the reasoning is as simplistic as it’s being described here. Trade is definitely not zero sum, but it’s easy to take that reasoning too far. If Joe grabs a larger share and leaves you with the same amount every time you order a larger pizza, you’re not benefiting from the growth. Upgrading from the medium to the large gives you X square inches of additional pizza, and how you and Joe divide that extra pizza up is decidedly zero sum.

        Economic growth is hard. It requires capital investments and new technology. We’re never going to see 900% growth in one year. Given that we get a certain amount of per-capita growth every year, the way we divide that additional income is an interesting question. When we say, “Wages are stagnating for the least skilled workers,” that could mean that growth is stagnating for everybody or that the least skilled are no longer getting the same share of the new income that they used to. They’re losing in the zero sum part of the game.Report

        • Avatar Tod Kelly in reply to Troublesome Frog
          Ignored
          says:

          Dude, if your comments are of this caliber you should stay delurked.Report

        • Avatar DensityDuck in reply to Troublesome Frog
          Ignored
          says:

          “Upgrading from the medium to the large gives you X square inches of additional pizza, and how you and Joe divide that extra pizza up is decidedly zero sum.”

          Except it isn’t “zero sum” in the sense meant by the OP. You’re correct that each individual transation is zero sum because there is a finite amount of wealth involved in the transaction (eventually you haven’t got any pizza left) but that doesn’t mean that the amount can’t grow with every successive transaction (order more pizza next time). The zero sum thinking that the OP decries would say that the second part of that sentence doesn’t exist–that pizza will always and forever be one size, and the only way to ensure that everyone gets as much as they’d like is preset rules for how much everyone can eat.Report

          • Avatar Troublesome Frog in reply to DensityDuck
            Ignored
            says:

            I totally agree that assuming a constant pizza size is broken reasoning. But that “income growth by quintile” graph is the result of a long sequence of zero sum divisions of the positive sum gains.

            I’m not concerned about growing inequality in absolute terms as long as everybody sees a slice of the new income. I just don’t want us to make the leap from, “It’s wrong to hate rich people for being rich,” to “We needn’t concern ourselves with how gains in productivity are divided up,” without thinking about it.Report

            • Avatar DensityDuck in reply to Troublesome Frog
              Ignored
              says:

              I don’t think people are arguing that genuinely harmful distributions are okay. I think people are arguing whether A: the distribution is genuinely harmful, and B: whether the response is redistribution or increased wealth.Report

            • Avatar M.A. in reply to Troublesome Frog
              Ignored
              says:

              Where DensityDuck’s argument falls flat:

              The first night, Bob and Jim order 1 medium pizza. Bob eats most of it, Jim gets only half a slice. Half a slice is an insufficient dinner.

              The second night, Bob and Jim order 2 medium pizzas. Bob again eats his fill, leaving Jim with – again – only half a slice.

              The third night, they order 3 medium pizzas. Jim gets a whole slice this time, which is barely enough to constitute a dinner, while Bob is beginning to look like this guy.

              Bob’s clearly operating in excess, Jim still nearly in famine, even though it’s been a “positive sum” and the availability of pizza – in absolute terms – has increased threefold.Report

              • Avatar Patrick Cahalan in reply to M.A.
                Ignored
                says:

                What if Jim only wants a slice of pizza? Is Bob still operating in excess?Report

              • Avatar Jaybird in reply to Patrick Cahalan
                Ignored
                says:

                It’s not fair that I’m only getting 2000 calories a day when someone else is getting 6000.Report

              • Avatar Patrick Cahalan in reply to Jaybird
                Ignored
                says:

                Well, if you’re telling me that I need to chip in $5 to pay for Bob’s gastric bypass surgery 5 years from now, then Bob is still operating in excess even if I don’t even like pizza.Report

              • Avatar M.A. in reply to Patrick Cahalan
                Ignored
                says:

                We’ll stipulate:

                – Half a slice = insufficient for a meal.
                – Whole slice = a bare minimum, subsistence meal.
                – Two slices = an average human meal, which will leave a normal human feeling “full” and “satisfied.”

                It’s an analogy, and I’ll freely admit the analogy doesn’t run perfectly (it doesn’t for DensityDuck’s argument either, which was kind of my point). It’s a basic framework.

                Where it really breaks down is the assumption – extended to the argument about “positive sum” interactions in the current economy – that there is a “positive sum interaction” that can infinitely increase availability of resources.Report

              • Avatar DensityDuck in reply to M.A.
                Ignored
                says:

                “Bob again eats his fill, leaving Jim with – again – only half a slice.”

                Why did Jim agree to an arrangment where he pays twice as much for the second night’s dinner but doesn’t get any more pizza?

                Please answer with something other than “HURF DURF RICH PEOPLE”. Please tell me that you have something beyond that.Report

              • Avatar Morat20 in reply to DensityDuck
                Ignored
                says:

                You do realize what an “analogy” is, right? That, specifically, it is not an exact model of a problem but merely a little story used to illustrate some key point?

                Therefore going “OMFG, what about X! If you can’t answer it YOU ARE WRONG!” is not really an argument? Heck, it doesn’t even matter WHY Jim agreed to it — only if it’s an accurate-ish analogy for the situation.

                Which it is — That’s a pretty good analogy for how productivity gains have been divied up, if Bob is the top 1% (or really 0.1%) and Jim is everyone else, over the last few decades.

                Which was the POINT of the analogy — show how a positive-sum game can result in massively skewed results even if everyone’s share of the pie technically grows.Report

              • Avatar DensityDuck in reply to Morat20
                Ignored
                says:

                “Therefore going “OMFG, what about X! If you can’t answer it YOU ARE WRONG!” is not really an argument?”

                I think you need to go back and read who was replying to whom with what.Report

              • Avatar Morat20 in reply to DensityDuck
                Ignored
                says:

                The “HURF DURF RICH PEOPLE” comment really makes it difficult to take you seriously.

                But hey, dodge the point — it doesn’t MATTER why Jim agreed to it. “Why would Jim agree to X” wasnt’ the point of the analogy. The point of the analogy was to demonstrate how a massive increase in production that makes both people better off is not necessarily super happy rainbow puppies.Report

              • Avatar DensityDuck in reply to DensityDuck
                Ignored
                says:

                “dodge the point ”

                I’m not dodging the point, you idiot, I’m pointing out how MA started the conversation by doing what you claimed I’m doing.Report

              • Avatar Morat20 in reply to DensityDuck
                Ignored
                says:

                Yeah, still not seeing it. *shrug*Report

              • Avatar M.A. in reply to DensityDuck
                Ignored
                says:

                It’s hard to see what was never there, Morat20. And DensityDuck’s “HURF DURF RICH PEOPLE” comment was just his usual trolling to clue everyone in that he wasn’t interested in seriously addressing the point.

                No matter what I wrote, that would have been his response. Engaging him is meaningless.Report

              • Avatar M.A. in reply to DensityDuck
                Ignored
                says:

                We’re looking at an analogy for what is actually going on in working conditions in America.

                The “payment” is working hours. Bob, company owner, eats his fill. Works same hours or less. Jim, employee, works what hours he is assigned to keep his job (out of fear of unemployment in a down economy). Jim may actually be putting in more hours today in unpaid overtime just to keep the job.

                Profits increase. Bob increases his take, but rarely if ever increases Jim’s salary, certainly not enough to keep up with inflation and the rising costs of necessities like gas and housing.

                Do you get it yet? Income is the pizza on the table. It hasn’t increased nearly by 300%, but it’s “increased.” Jim, representing the lower and middle class, just hasn’t seen ANY of the increase actually reach him – certainly not enough to keep up with the expenses of life – because it’s all stayed in Bob’s greedy gullet.Report

              • Avatar DensityDuck in reply to M.A.
                Ignored
                says:

                So you’re making a power-differential argument (badly) but up-thread when I said that the answer was trade unions you freaked, and your buddy Morat20 is right there with you. So I don’t even know what you’re trying to argue anymore, other than HURF DURF RICH PEOPLE.Report

              • Avatar M.A. in reply to DensityDuck
                Ignored
                says:

                but up-thread when I said that the answer was trade unions you freaked

                You’ve been the guy arguing that trade unions are bad and should be abolished.

                While I’m happy to see the about-face, the entire point of that ought to be that policies deliberately designed to destroy trade unions, which is what the republicans have been peddling for the last 30 years, are bad for society.

                Agree or disagree? Let’s have an honest answer from you. For once. No snark, no insults, just answer the damn question.Report

              • Avatar DensityDuck in reply to DensityDuck
                Ignored
                says:

                “You’ve been the guy arguing that trade unions are bad and should be abolished.”

                (citation needed)Report

              • Avatar Troublesome Frog in reply to DensityDuck
                Ignored
                says:

                Why did Jim agree to an arrangment where he pays twice as much for the second night’s dinner but doesn’t get any more pizza?

                I didn’t think that paying for pizza was part of the model. I thought pizza was exogenous. That’s how I’m modeling growth here.

                Say somebody invents shovels, causing ditch diggers to become more productive. Should ditch diggers be paid more as a result, or should the ditch digging company shareholders capture all of the surplus? Or should the surplus all go to the inventor of the shovel?

                The real question you seem to be asking is, “Why don’t the ditch diggers demand more of the extra income the shovels are generating?” When they can get away with it, they do. But there’s always a split, and that split depends on bargaining power more than any cosmic justice or meaningful measure of worthiness.Report

              • Avatar Morat20 in reply to Troublesome Frog
                Ignored
                says:

                The answer is simple: Because they’re fired if they do, because collective bargaining has become a dirty, dirty word, and because there’s absolutely NO REASON an employer would ever pay an employee more than the absolute minimum he had to. For anything.

                Not in any business of actual size.

                You know, there’s a question — why aren’t libertarians ridiculously pro-union? Just in general.

                It seems like a no brainer. Without some countervailing force, employers would — and do – -start in on all the horrible coercions of power that are so derided in government.Report

              • Avatar M.A. in reply to Morat20
                Ignored
                says:

                To a Libertarian, any form of abuse is acceptable as long as the word “government” isn’t attached to it. The libertarian ideal is 14th century serfdom modified with a “right to move to a different monarchy.”Report

              • Avatar Morat20 in reply to Morat20
                Ignored
                says:

                “Government is that which protects against all excesses of power except it’s own”.

                My (generalized, not limited or aimed at specific people) issue with libertarians is that they often fail to remember that, absent government, there are other actors both quite powerful and quite capable of abuse and excess — and far less responsive than government.

                On the one hand, I get the whole “focus on the guy currently with his boot on your face” issue. I’m sympathetic. On the other hand, when solutions re: Boot on the face of humanity are to go BACK to the previous boots on our face or neglect the previous boots on our faces, I can’t help but remember.

                We choose government because it was better than those guys. We gave it so much power because it was better than those guys. Anything to make government “better” or “more free” or “whatever” (or replace it!) must ALSO protect from, you know, THOSE GUYS.Report

              • Avatar M.A. in reply to Morat20
                Ignored
                says:

                “You don’t understand. Ferengi workers don’t want to stop the exploitation. We want to find a way to become the exploiters.” – Libertarians, the ultimate Ferengi.Report

              • Avatar James Hanley in reply to Morat20
                Ignored
                says:

                To a Libertarian, any form of abuse is acceptable as long as the word “government” isn’t attached to it. The libertarian ideal is 14th century serfdom modified with a “right to move to a different monarchy.”

                [Citation needed.]Report

              • Avatar Plinko in reply to Troublesome Frog
                Ignored
                says:

                T. Frog –
                The comments are coming too fast for me to keep up replying, but this is a great way to put it.Report

        • Avatar Shannon's Mouse in reply to Troublesome Frog
          Ignored
          says:

          Exactly!

          How are the gains attributed to growth being distributed? Is that distribution just? Is it sustainable?Report

          • Avatar Roger in reply to Shannon's Mouse
            Ignored
            says:

            Shannon,
            Gains are not distributed until they are created. The gains are realized by the producers or those mutually agreeing to the exchange. Separating the creation and exchange — which create the wealth – from the distribution confuses the issue. Recognizing that they are voluntary reveals that they are just, assuming the basic rules of the game are just.Report

  4. Avatar Snarky McSnarkSnark
    Ignored
    says:

    While I think it is perfectly natural to caricature one’s political adversaries, in this case I think you have “progressives” exactly wrong. In the liberal order, better positive outcomes are achieved.

    If you compare the economic growth rates during conservative and liberal administrations, you will find that the economic growth rate is 30 – 50% higher in aggregate. Moreover, the growth is more widely spread. I think this is true, in part, because liberal ideology better understands that good economic outcomes come not from single heroic entrepreneurs, but from widespread, shared prosperity, a societal valuing of the common welfare over the individual, and a pragmatic pursuit of widespread economic opportunity.

    I can understand how, from the conservative / libertarian side, this can look like a zero-sum philosophy. But the liberal outlook does not look at Bill Gates and conclude that he is one million times more worthy, or one million times more productive than the average American (mirroring the ratio between his net worth and the median American’s). He has a set of talents–entrepreneurship, marketing, organization and technology–that has allowed him to create something giant. But Microsoft’s rise also had much more to do with the culture, time, and environment in which it arose: without the space program and the defense industry, microcomputers would not exist. Without IBM, Microsoft would never had arisen to its current position. Without some pretty shady and aggressive business tactics, Microsoft would not have wiped out its competition and come to dominate our era’s most prominent industry.

    Liberals don’t look at Gates as a Randian hero, and consider that he “earned” his $70 billion. They understand that a market economy is a pretty efficient means to growth and distributional efficiency. They also recognize that it creates incentives to pursue individual goals at the expense of societal good: and believe that modifying the incentives and outcomes of an untrammeled market will result in greater prosperity, better distributional outcomes, and a fairer, more robust outcomes for the greatest number of people.

    There’s nothing “zero-sum” about that.Report

    • Avatar Stillwater in reply to Snarky McSnarkSnark
      Ignored
      says:

      Roger has a very unique understanding of the word “progressive”. Maybe he could articulate what he means by that term and preemptively avoid some of the resulting confusion.Report

      • Avatar Roger in reply to Stillwater
        Ignored
        says:

        Stillwater,

        I believe progressive ideology shares many of the beliefs of classical liberals or libertarians but deviates in the following critical ways:

        1) Progressives are much more concerned with the importance of equality of outcome.
        2) Progressives are more trusting and dependent of top down, rational, government run solutions.

        I believe these two are related, as supplying the master plan to achieve equal outcomes requires massive governmental interaction. In the real world, people have different capacities, interests, specialties, time horizons, risk preferences and goals. To expect equal outcomes on any given dimension is simply absurd absent massive and coercive interference. I should probably do a better job though of contrasting progressivism to statism. Many conservatives are not progressives, but are statists.

        I agree that forward “progress” on the expansion of the state actually occurs while Republicans are at the helm.Report

        • Avatar Snarky McSnarkSnark in reply to Roger
          Ignored
          says:

          I don’t know of a single liberal that advocates for “equal outcomes.”Report

          • Avatar Patrick Cahalan in reply to Snarky McSnarkSnark
            Ignored
            says:

            Equal opportunities, certainly.

            But not even the craziest liberal actually thinks that everybody is exceptional. Wait… okay, the craziest liberals probably think that. But then so do the craziest of any political philosophy.Report

            • Avatar Rufus F. in reply to Patrick Cahalan
              Ignored
              says:

              Is it even a question of equality of opportunities though? I suppose, if Roger’s right on both points, I’m not a progressive. So, maybe I should stay out of this particular discussion.

              But it seems to me that most people will accept some inequalities of opportunities; like maybe it was easier for you to get capital to start your company because you went to an Ivy League school and were a member of the same fraternity as the investor. Okay. What seems more unjust are inequalities of barriers (wow, that’s a bad locution!). So, if you’re a smart young person who is driven and hard working and has a brilliant idea for a company, but nobody will give you any start-up capital because you weren’t a member of Crappa Zappa Gamma at Yale, that would likely strike us as unfair. I’m not saying that’s the case but you see where it would be a problem.

              And let me be clear, I don’t mean “unfair” in some metaphysical moral sense. I just mean that all of us choose to consent to, and be embedded within, a social order. Partly, we do this because we believe that the social order affords us some avenues to live and thrive, provided we’re talented and work hard. It becomes a problem when enough people come to believe the social order is rigged. Q: Why is it a problem? A: Egypt. Since libertarians care about limiting the power of the state, they should recognize that when people start throwing trash cans through windows on a large scale, it almost always ends with some sort of military rule and put stock in social stability as well. So, in that sense, “inequality” is a concern.Report

    • Avatar Piper190 in reply to Snarky McSnarkSnark
      Ignored
      says:

      Thank you for pointing this out, I was planning a similar comment if none had already been offered. The facts of the matter are such that liberal policies have actually produced positive sum situations to a much greater extent than conservatives have: http://www.bloomberg.com/news/2012-02-22/stocks-return-more-with-dem-in-white-house-bgov-barometer.html . Highlights: $1000 invested only during Democratic Administrations would return 500% (5 times) more than money invested only during Republican Administrations. 7 of 8 recessions since Kennedy began with a Republican in the White House. The annualized return for 23 years of Democratic administrations is 11 percent, or four times the 2.7 percent annualized return during 28 years of Republican presidencies.

      http://www.thomhartmann.com/forum/2012/05/us-dollar-fell-92-under-republican-presidents-1929-stock-market-has-perfomed-27x-bette Highlights: using a different time period than the previous link, the New York Times reported that since 1929, $10,000 invested in the stock market under Democratic Presidents (over 40 years) had become $300,671. Meanwhile, $10,000 invested in the stock market under Republican Presidents (over 35 years) had become only $11,733.” and “Well, at least the affluent caste didn’t lose money during Republican regimes, right? Wrong. The value of the dollar dropped by 92% during that period. So in real value, $10,000 invested in the stock market under Republican Presidents actually became just $955.”

      I don’t buy the positive sum conservative/ negative sum progressive frame anyway, but even if that is the case, the reality is that progressives have produced almost infinitely better positive sum outcomes.Report

      • Avatar Roger in reply to Piper190
        Ignored
        says:

        My argument is on statist progressive ideology, not performance based upon who sits in the white house. I also agreed it was a mistake to include the word “conservative” in the argument. It was a last minute addition that I regret.Report

  5. Avatar Rufus F.
    Ignored
    says:

    Okay, so James makes this request that people should write about their own beliefs and why they believe what they believe, instead of trying to explain what some other group believes and why they’re fundamentally wrong. His example was that progressives should tell us why they believe what they do about inequality, instead of using the occasion to bash libertarians, who they probably don’t understand anyway. So, I think to myself, “There’s no way the posters are going to be able to manage this.” So far, I’m one for one.Report

  6. Avatar James Hanley
    Ignored
    says:

    Great start, Roger. I thought you’d probably address the pos/zero sum issue, and I’m glad you did so I can take a different approach.

    From my perspective, two of the first three commenters have missed the point, being too quick to repeat talking points that are actually about dividing the current pie, engaging in zero-sum thinking while suggesting that they don’t actually engage in zero-sum thinking.Report

    • Avatar North in reply to James Hanley
      Ignored
      says:

      I’m crushed ;.;Report

    • Avatar Roger in reply to James Hanley
      Ignored
      says:

      Thanks James,

      For the record I submitted this as a suggested prequel to the dialogue. My main piece actually delves into the problem of class mobility within a specific sub segment of the poor. Erik thought this should just start the fray. Hopefully everyone allows my main piece through as well.Report

    • Nob Akimoto Nob Akimoto in reply to James Hanley
      Ignored
      says:

      You constantly bemoan that “liberals” are out to paint libertarians as strawmen, yet you applaud a post that says liberals and progressives are avid, greedy, narrow-sighted zero-sum thinkers, while libertarians are on the side of saints and angels and positive sum gains for everyone….

      …really?Report

    • Avatar ThatPirateGuy in reply to James Hanley
      Ignored
      says:

      I would suggest that a system that is positive sum overall can be quite zero-sun for some of its parts.

      Suppose we have a circle of wealth of 100 wealth units. Next suppose there are 5 people who consume/produce this wealth. At the start each person controls/consumes 20 wealth units.

      Person B comes up with a way to generate 200 wealth units for the whole Society. After this method is implemented person B and person C Each have 77.5 wealth units but A, D, and E each only have 15.

      Over all a positive sum situation but he majority of the society is actually worse off.Report

      • Avatar Roger in reply to ThatPirateGuy
        Ignored
        says:

        Pirate,

        I don’t actually disagree. I am espousing mutually beneficial interactions. In other words that people not harm or coercively force each other to do things against our will. Although this does prohibit direct harm, it doesn’t protect someone from what I will call “lost opportunity.” An example is 5 buggy whip producers. Two of them figure out how to manufacture cars and the other three now make zero. They were not coerced at all. The only way they were harmed is they lost an opportunity. But their kids depended on that opportunity for food on the table.

        Economics works in delivering prosperity because the incentives are there for the unemployed buggy ship makers to do something productive with their labor and ingenuity. Thus we now have cars and…. Whatever else these three can produce. At any one step it can look like a zero sum game, but it accumulates solutions and efficiencies and new ideas as it goes along.

        Your point also brings up the importance of social safety nets. Unemployment insurance for buggy whip makers in this case. Safety nets allow free enterprise to be less scary, and reduce the incentive to obstruct change. Indeed, I believe a lot of the increase in econmic progress over the last few hundred years came because those that would have gained by preventing progress were unable to find a way to stop it as they had in the past.Report

  7. Avatar DensityDuck
    Ignored
    says:

    Make the pie higher!Report

  8. Avatar Elias Isquith
    Ignored
    says:

    It’s going to be a long, hard symposium if we never establish that when we talk about inequality, we’re talking about the rate of growth of inequality — not the distribution of wealth in absolute terms. Again: this isn’t about a finite set of resources but whether the rate at which continuously growing wealth is flowing disproportionately and sub-optimally upward. As Roger’s demonstrated in this post, anyone who would argue that the issue is how what we have already is distributed isn’t likely to leave the debate victorious.Report

    • Avatar James Hanley in reply to Elias Isquith
      Ignored
      says:

      Who gets to determine just what we’re talking about? I’m not sure whether you’re trying to be a dictator of focus or just clarifying what you believe liberals are focusing on. If the former, sorry, no dice. If the latter, please write apost clarifying your case. And if so, please note that my preemptive question is whether increasing rates of inequality are bad even if the least well off are still becoming better off in absolute terms. That’s not snark, but my sincere question.Report

      • Avatar Elias Isquith in reply to James Hanley
        Ignored
        says:

        I’m clarifying what people who debate this seriously are arguing over. And what I’m talking about when I discuss inequality in my own work/life. I couldn’t speak to your parting question without knowing how we’re defining “better off in absolute terms.” I’m going to hold off until the end of the week to post my take on this, in part because I’d like to get into it after the parameters and particulars of the debate have come into clearer focus.Report

        • Avatar James Hanley in reply to Elias Isquith
          Ignored
          says:

          Elias,

          I look forward to your post. Whether my perspective matters or not is up to you, but I really do question the “rate of growth of inequality” approach. Assume the rate of growth of inequality was 0% at T1, then increased to 1% at T2. Would that be unacceptable? That is, how would we know when the rate of growth does become unacceptable? What would be our criteria? I think it has to be something more than, “OMG, it’s really bad right now.” And honestly–and please forgive me if I’m being totally unfair here–it seems to me that this is exactly the approach that’s generally being taken by those who express concern.Report

          • Avatar M.A. in reply to James Hanley
            Ignored
            says:

            Arguing over whether temporary growth of inequality at 1% or 2%, which should recede in what Libertarians constantly claim are “normal market cycles”, is unacceptable is the realm of theorists and pedants.

            Failure to recognize that this is unacceptable, and that the sustained pattern over 30+ years has resulted in an abusively asymmetrical disparity, is clueless libertarianism.Report

    • Avatar DensityDuck in reply to Elias Isquith
      Ignored
      says:

      “this isn’t about a finite set of resources ”

      In other words, you’re quoting Jesus when he said “the poor will always be with us”. They’ll just find different things to be poor about.

      “I’m poor! I can’t afford more than a ten-by-ten room for each of my children, I’m not sure if I’m going to retire in the same job I first hired into, and if I got a rare cancer then I probably wouldn’t die but it would be really expensive!”Report

    • Avatar Mike Dwyer in reply to Elias Isquith
      Ignored
      says:

      It’s going to be a long, hard symposium if we never establish that when we talk about inequality, we’re talking about the rate of growth of inequality — not the distribution of wealth in absolute terms.

      I disagree. The topic was intentionally broad for a reason. For example, i’m discussing inequality in education. I don’t care about the rate of growth (which is actually a non-factor). I’m discussing the harms, possible solutions, etc.Report

  9. Avatar M.A.
    Ignored
    says:

    The part of Roger in this video has been played by Count.

    Don’t you get tired of recycling the same old nonsense? “Progressives” have not argued that inequality is based on a zero-sum game. There are definite positives to be had in commerce and positive-sum interactions to be had. Inequality can easily grow in a “positive sum” environment as a result of one party taking far more of the benefit than another party.

    The zero sum outlook logically leads to some common progressive conclusions. If you subscribe to the zero sum view, consciously or unconsciously, you will tend to believe: To quote the good lady Pointercount: horseshit.

    Those that are well off probably became so at expense of the less well off.

    Inasmuch as the “positive sum” benefits of the interaction were inherently asymmetrical. “Median income” in the US has generally risen since the nation was founded. However, “Median income” in the past 30 years has risen only as a result of the top 1%’s income rising; inflation-adjusted wages for the middle and lower classes have remained virtually stagnant.

    There’s a positive sum interaction in toto, but it’s not being apportioned in a positive-sum manner. One group is taking all the benefit at the expense of the other group’s stagnation.

    Therefore, the wealthy are morally suspect and the poor are probably victims.

    If one participant in a “positive sum interaction” is playing the Red Queen’s Race, and the other party is constantly becoming wealthier, then Occam’s Razor says that the simplest explanation – that morally suspect behavior is keeping the benefit from those playing the Red Queen’s Race – is most likely correct.

    It is just to correct this imbalance by limiting or redistributing wealth.

    Ethically, given the result of the previous, this is correct. Immoral activity resulting in harm to one part and benefit to another should be addressed.

    Since the pie is a fixed size, we better get more for the good side (or at least our side).

    None of this requires that the pie be a fixed size. Your whole argument is a dishonest, bigoted fallacy.Report

    • Avatar Tod Kelly in reply to M.A.
      Ignored
      says:

      “Don’t you get tired of recycling the same old nonsense?”

      Oddly enough, that’s exactly what I was thinking when I saw yet another link to that Kentucky Fired Movie bit.Report

    • Avatar Bad-ass Motherfisher in reply to M.A.
      Ignored
      says:

      Brother, you’re making me sad.

      You seem to be fairly new to this site, and your early comments were pretty interesting, and pretty well written.

      But you seem to be becoming more snarky, hostile, bitter, and combative. I would urge you to please reconsider your tone. I think you have a lot to add, here.Report

    • Avatar North in reply to M.A.
      Ignored
      says:

      I’m gonna echo B-A M. here M.A.
      You started out great and then you seem to have become very terse and annoyed. Please reconsider; you clearly have lots of intelligent points to make. Letting people push you into anger obscures your useful points.
      Your heat is beginning to obscure your light and lady knows we could use the light of some more liberals about here.Report

  10. Avatar Bad-ass Motherfisher
    Ignored
    says:

    To elaborate a little, Roger has been one of the most thoughtful and respectful posters here. I agree with almost nothing he says, but he engages civilly with anyone who approaches him in the same spirit. This is an interesting set of topics, and fundamental to the kind of society we want to live in. I really look forward to seeing these ideas engage with each other.

    But “horseshit,” and denouncing another’s arguments as “dishonest, bigoted fallacy” is not the kind of engagement I was looking for.Report

    • Avatar M.A. in reply to Bad-ass Motherfisher
      Ignored
      says:

      I gave up on the illusion of Roger’s civility about the time he described some of my friends as “a special interest group in cahoots with politicians to siphon tax dollars into sweetheart union pensions”, which is a longwinded way of calling them leeches and insinuating that they did illegal or immoral things in bargaining for fair wages and benefits.

      He’s not civil, he’s just longwinded and flowery in his bigoted insults.Report

      • Avatar Patrick Cahalan in reply to M.A.
        Ignored
        says:

        He was clearly talking specifically and only about your friends. I can see how you’d be offended by that.Report

        • Avatar Michael Drew in reply to Patrick Cahalan
          Ignored
          says:

          Why does “specifically” or “only” matter? Generalizing about people who turn out to be real people that people know and love ends up being quite specific in the event. And “only” is irrelevant; what he said applies just as specifically to some of my loved ones.Report

  11. Avatar Patrick Cahalan
    Ignored
    says:

    Roger:

    I think you’ve made a good distinction, and if you threw your post and mine together in a blender and threw it against the wall, we might get somewhere.

    Here’s my quibble: I think this is unfortunately framed as an either/or, when the fungible nature of money means it is a both/and. And this explains why everybody talks past each other on this point; they’re both right.

    The vast majority of luxury goods are definitely value-add, positive value creating, non-zero sum portions of the economy. Totally with you there.

    The vast majority of staple goods are definitely *not* value-add, and they are zero-sum portions of the economy. What is worse, due to our fiscal policy and market approach to both luxury goods and staple goods as being fungiblated using the same enfunginator of “money”, people who are looking at investments as “return on capital” definitely take large sums of fungible money that they made making positive-value-creating-non-zero-sum luxury goods and investing it in base good futures and whatnot.Report

    • Avatar DensityDuck in reply to Patrick Cahalan
      Ignored
      says:

      “The vast majority of staple goods are definitely *not* value-add”

      Staple goods like cars, healthcare, education, and telecommunications?

      I mean, I know I keep harping on this point, but is it truly the case that because people in 1950 had cars and people in 2012 have cars, we must pretend that a new car in 2012 is equivalent to a new car in 1950?Report

      • Avatar Patrick Cahalan in reply to DensityDuck
        Ignored
        says:

        I’m taking a much more global perspective. I’m far less concerned with inequality on the metric of fairness and far more concerned with destabilizing forces. I don’t think America is so unequal as to be unstable (compare to, say, China, Russia, India… all fairly large economic engines that are much more unequal than we are, in the sense I’m using “unequal” anyway, and yet are pretty stable).

        It’s particularly funny when we (Americans) argue about what constitutes staple goods when there are other people out there for whom the idea is essentially a completely different game. You’ll see when my post goes up.

        > Is it truly the case that because people in 1950 had cars and
        > people in 2012 have cars, we must pretend that a new car
        > in 2012 is equivalent to a new car in 1950?

        No.Report

      • Avatar Kimmi in reply to DensityDuck
        Ignored
        says:

        DD,
        in a lot of respects, they’ve gotten worse.
        I refuse to buy a car until their technology is remotely approaching current.

        Health insurance is not a value added industry, in the main.Report

    • Avatar Stillwater in reply to Patrick Cahalan
      Ignored
      says:

      Good comment Patrick. That’s what I’ve been trying to get at myself in this thread. The one way I can think of the make the point is this: the positive sum theorist picks a paradigmatic example of an exchange that yields increased wealth for the manufacture and increased utility for the purchaser. The purchase of an ipod! And because the positive sum, subjective utility of this market transaction is so crystal clear and unobjectionable, they work their way outwards to say that all transactions are positive sum, subjective utility maximizers.

      I don’t think that’s the case.Report

      • Avatar Patrick Cahalan in reply to Stillwater
        Ignored
        says:

        I don’t think the converse is the case, either.

        And the really sticky widget is that this is agent-dependent.

        Oh, hell, I’m going to throw up my post today. Just wait for it 🙂Report

      • Avatar James Hanley in reply to Stillwater
        Ignored
        says:

        And because the positive sum, subjective utility of this market transaction is so crystal clear and unobjectionable, they work their way outwards to say that all transactions are positive sum, subjective utility maximizers.

        I don’t think that’s the case.

        OK, so how about some examples? Can you demonstrate that non-positive sum transactions constitute a significant proportion of market transactions?Report

        • Avatar Stillwater in reply to James Hanley
          Ignored
          says:

          You carve out a different set of actions depending on how you define ‘voluntary transaction’, it seems to me. The positive sum theorist, as I understand their views, looks at any transaction which isn’t physically coerced (say at gun point) as constituting a voluntary action, and therefore a utility maximizing one. The argument here seems to be that since any transaction which isn’t physically coerced is voluntarily entered into, and since the agent is stipulated to be rational wrt assessing his own utility, the exchange of X for Y entails that the individual views the transaction as maximizing his utility relative to all other options.

          One of my objections is that this analysis is danger of collapsing into vacuity. If it’s the case that for all non-physically coerced transactions T, agent A maximizes his subjectively determined utility if and only if his T isn’t physically coerced, then it is impossible for agent A to have ever been motivated by irrational impulses when engaging in any transaction. All of his non-physically coerced choices are entirely (subjectively) rational. But I think this is either descriptively inaccurate (false) or vacuous (since it’s tautological: subjectively rational iff non-physically coerced).

          Considering each in turn, it seems to me descriptively inaccurate to me to identify the set of voluntarily entered into transactions with the set of non-physically coerced transactions. The purchase of luxury items might constitute a type of transaction where the sets are identical – which is the best case scenario for the positive sum theorist it seems to me – but even that is subject to troubling counterexamples. For example, advertising is based to a large degree on instilling in the target audience unconscious associations which motivate that person – irrationally! – to purchase a good or service. If so, then determinations of subjective utility are divorced from rationality in an important way (not necessarily a decisive way, but from where I’m sitting it doesn’t look good for the positive sum theorist).

          Now, that’s just one case, to be sure, but it highlights what I think is an important objection to the view: subjectively determined rationality is an epistemic concept limited to what an individual believes about his own situation even if he’s entirely wrong about matters of fact. And given that, it’s entirely possible that a person’s subjectively determined rationality can in fact be wildly irrational.

          On the other hand, if it’s the case that a person’s subjectively determined rationality cannot be irrational, then the view is vacuous. Rationality is just identified with anything a person does or believes.Report

          • Avatar James Hanley in reply to Stillwater
            Ignored
            says:

            First, I’ll agree with you that “physically coerced” is too narrow. I was teaching a class once where we were discussing the Pledge of Allegiance in schools issue. One girl said, “nobody is holding a gun to their head.” I snapped at her, “get out of my classroom, now!” Shocked, she got up and slowly walked to the door. Just before she got there, I called her back and said, “Did I hold a gun to your head?” So, yes, psychological compulsion is possible, and is also legitimate (in fact I’m not sure what I did to the student was legitimate, although it was an effective teaching moment). Or a more serious example–rape can result from psychological coercion, not just physical force.

            But advertising just isn’t the psychological compulsion people tend to think it is. The best advertising can do is get you to try a new item once and to remind you about items you like but might otherwise not think to buy. If you try a product and don’t like it, advertising won’t make you try it again. Campbell’s Soups once tried to do without advertising, figuring that since they had such a dominant shelf space in the “red aisle” of the grocery store, advertising was superfluous. Their sales plummeted–those who went into the red aisle still bought Campbell’s, but people didn’t think about putting it on their grocery lists so they didn’t all go into the red aisle. That’s still positive sum–people like soup, and they’re willing to pay for it. And advertising frequently fails to move market share at all; it’s powerful, but just not powerful enough to overcome our ability to make our own choices.

            And from another perspective, if the advertising really has made me love product X, then–because utility is subjective–if I buy product X I really have increased my utility. Only someone standing outside substituting their own “superior” judgement for mine can say otherwise.

            I just don’t see that you’ve demonstrated that there’s any substantial set of non-positive sum interactions in the market.

            IReport

            • Avatar Stillwater in reply to James Hanley
              Ignored
              says:

              I just don’t see that you’ve demonstrated that there’s any substantial set of non-positive sum interactions in the market.

              What I’ve done, I think, is demonstrate that a person’s perception that an exchange is utility maximizing is divorced from whether it in fact is or isn’t. For your view to make sense, the mere appearance of utility maximization isn’t enough. It has to actually be utility maximizing. And subjective determinations aren’t enough to establish that.Report

              • Avatar James Hanley in reply to Stillwater
                Ignored
                says:

                It has to actually be utility maximizing. And subjective determinations aren’t enough to establish that.

                I don’t understand this. If utility is subjective, then only subjective determinations can establish if an exchange enhances utility. What other yardstick can there possibly be?Report

              • Avatar Stillwater in reply to James Hanley
                Ignored
                says:

                But people can be wildly delusional – hence irrational – about how they view the world, right? People can be compelled to make purchases of items which even they don’t understand. If so, then the subjective determinations they make regarding their utility are irrational, even tho they’re viewed by the agent as (subjectively) rational. There’s a disconnect there. Rationality doesn’t reduce to the (current) beliefs we hold. If it did, no one would – or could – ever be (or act) irrational(ly).Report

              • Avatar James Hanley in reply to Stillwater
                Ignored
                says:

                “But people can be wildly delusional…”

                In extreme cases we can certainly use the law to define what counts as illegitimately taking advantage of people. We already have the concept of fraud from which we can work.

                For cases below that, well, see the comments below about who gets to choose.

                As for rationality, no, it isn’t about the beliefs we currently hold. It’s just about being able to create a reasonable preference order and making reasonable decisions about how to pursue utility enhancements. Most people make pretty good choices for themselves–which doesn’t mean their choices necessarily impress those viewing from outside. Again, we have to be extremely careful about whether we’re substituting our own judgements on utility and choice for that of the individual.Report

            • Avatar Stillwater in reply to James Hanley
              Ignored
              says:

              Also, if your view is tautological, then it’s impossible for me to show that there is a set of transactions that aren’t positive sum. And that’s what I’m arguing against. On your view, any transaction which isn’t coerced is by definition utility maximizing and therefore positive sum. But it seems to me that you can’t derive a metaphysical conclusion (positive sum) from an epistemic premise (subjective assessment of utility).Report

              • Avatar James Hanley in reply to Stillwater
                Ignored
                says:

                Eh, it’s not just tautological, though. It’s based on some axioms.

                1. Utility is subjective.
                2. People are (reasonably) rational
                3. People prefer more utility to less utility.
                4. They have free will (can freely choose to enter a transaction or not).

                Conclusion, only they can determine whether a transaction will enhance their utility, and they will only enter transactions that they expect to enhance their utility.

                Violate/disprove any of those and sure, non-positive sum transactions can occur. The most obvious is violation of 4, overriding someone’s free will and the transaction can’t be expected to be positive sum. 1 and 3 seem pretty solid, hard to violate or disprove.

                2, now that’s the tricky one. Just how rational does a person need to be to ensure a transaction enhances their utility? Not perfectly so. I may think a new car will give me 10,000 utils at a cost of 5,000 util, but in fact it only gives me 7,000 utils. That could be bad, if I had foregone some other opportunity in which those 5,000 utils would have garnered me 8,000 utils, but it’s still a positive sum interaction.

                It seems to me that for the most part the only non-positive sum interactions among normal people (setting aside those with severe mental/psychological problems, including drug addicts, where condition 2 doesn’t necessarily hold) is when we’re trying new things. My mom loves McDonald’s McRib sandwich. OK, I’ll give it a try–$4 ain’t much money and I like ribs. Hmm, that sandwich sucked the big one. OK, contrary to my expectations, that transaction was not positive sum. But that’s unavoidable because we’re making predictions about an inherently unknowable future. Technically rationality doesn’t even come into play here, just lack of information.

                Those transactions happen. Buyer’s remorse also happens, because some people have a tendency to irrationally overvalue prospective transactions. So in fact I think non-positive sum transactions can and do occur. But I think they’re a very small proportion of the total transactions that take place, and many of them take place in the context of experimentation with new products, where the net outcome of experiments is positive sum (well, at least it has been for me–presumably a person for whom it isn’t stops experimenting, like that friend whom you just can’t persuade to put anything except pepperoni on their pizza).Report

              • Avatar Rod in reply to James Hanley
                Ignored
                says:

                Number 4 is a stickier wicket than you’re letting on it seems to me. There’s a class of free-market types, usually the generic libertarian (sorry! I’m not intentionally trying to lump you in, just relating my experience) that wants to reduce all of economic activity to the satisfaction of “desires”. But clearly there are things that go beyond just “desire” into what most of us would consider “needs”. The classic “glass of water for the guy dying of thirst in the desert” sort of thing. It doesn’t need to be the case that any particular person, let alone the person offering the transaction, is actually coercing you for you to experience a kind of situational coercion. Yes… technically you have a choice. But the alternative is pretty awful (like dying) and so it’s more than a little facile to say the choice isn’t coerced.

                And it doesn’t have to get that extreme. Say you have to drive to work every day. Let’s say further that there really is no alternative to driving; it’s too far to walk, the route doesn’t lend itself to cycling, no mass transit at one or both ends, and there’s no one to car-pool with. I’ve been in exactly that situation a number of times. You’re gonna pay whatever Exxon fishin’ decides to charge for gas, like it or not.

                I don’t know if any of that takes it out of the category of “positive sum transaction” but if non-coercion is part of the formula it at least raises the question.Report

              • Avatar James Hanley in reply to Rod
                Ignored
                says:

                Rod,

                I’d say if it’s non-coercive, it’s almost definitionally positive sum. (There is, of course, the chance that we make a mistake about just how much we’ll enjoy that licorice flavored ice cream (worked in an ice cream shop one summer–stuff looked like modeling clay; we could hardly give it away), and of course I just might have been wrong about how much I would benefit from that 5th glass of scotch.)

                There’s a range where it’s hard to make a clear statement about coercion, but I’d say if the person actually can walk away from the transaction but decides not to because he’s just that desperate, then he’s decided the transaction is the better option, so it must be positive sum.

                Now if you purposely put me in that situation, tie me up and drop me in the desert for a few days, then it’s not really a positive sum transaction for you to offer me a glass of water in exchange for all my wealth because the transaction involves more than just my need for water–it involves what you coercively did to me before offering me the water.

                In your commuting situation (I’ve been there, too), it’s non-ideal for you, but positive sum doesn’t mean ideal; it just means both sides actually do gain from the status quo ante, or compared to the next best option. Say you’ve been hiking in the desert all day and out of pure foolishness didn’t take any water. When you hike out you reach my store, where I sell sulphurous well water for 2 bucks a glass. You can easily afford it, but you sure wish there was an alternative. In fact given the option you’d pay 5 bucks for a glass of really good clean water, but it’s just not available right there right then. That’s pretty far from ideal for you, but you decide you need water badly enough to pony up the dough for the nasty stuff–you must have decided it’s better than hanging onto the money and waiting to get water later, so you must have gained by the transaction, even if just barely.Report

            • Avatar Roger in reply to James Hanley
              Ignored
              says:

              Stillwater,

              Interesting points as usual. Let me add on to James…

              I am fine with allowing courts and precedent to establish what counts as coercion or duress. It won’t be perfect, but what is?

              This really strikes at the heart of the matter. An important issue in economic systems is “who gets to decide?” In command economies it is of course the person in charge and whoever they delegate to. In the jungle, it is might makes right. The strong decide. In free markets, the answer to the question is that everybody directly involved in the transaction gets to decide. Property rights just further extend this logic by assigning who gets to decide for what physical or intellectual property.

              I agree completely that rational adults make mistakes. Free enterprise will thus be imperfect. But the question is who could decide better? Who better knows the values, goals, context, tradeoffs than the individual involved? Just as important who gains if they decide right and receives feedback when the decision is wrong. The individual involved.

              In some cases, society has determined it is not acceptable to let even rational adults decide. It is illegal to voluntarily buy crack cocaine or to sell yourself into slavery.

              Last week we got a sub thread going on how we define “acceptable harm.” I suspect liberals and libertarians work with different lists.Report

              • Avatar James Hanley in reply to Roger
                Ignored
                says:

                An important issue in economic systems is “who gets to decide?”

                That’s a crucial point. Let’s assume humans actually are irrational and can’t reliably make utility enhancing choices for themselves. Would they then be able to reliably make utility enhancing choices for others?

                Let’s assume further that there is an elite class of super-rational people who actually are competent to make utility enhancing choices for others–how could we possibly devise a reliable selection system to bring them into influence in a society where most people actually are irrational?Report

              • Avatar Stillwater in reply to James Hanley
                Ignored
                says:

                As a general rule, I know I lost an argument when I can’t remember what I was arguing to begin with. And I’ll be damned if I can recall…

                James, this is an especially good comment. And Roger, your above comment was equally forceful. {{{lots to think about here}}}Report

              • Avatar James Hanley in reply to Stillwater
                Ignored
                says:

                Well, I can’t take credit for the idea, either its origin or its first presentation here. 😉 But for what it’s worth, it’s one of the ideas that really re-shaped my outlook on the world some 15-20 years ago when I first ran across it. I think the form it took was a conversation with one of my political science profs:

                Hanley: “This econ class is pretty interesting, but I just don’t buy that people are that rational. Somebody really needs to control the markets.”

                Prof: “So which of those irrational people are you going to put in charge of controlling the markets?”

                Hanley: “Uh…” [brain locks up]

                Still my favorite prof ever. He had a way of posing questions, to which he didn’t really expect an immediate answer, that would leave the serious student pondering it for a long time–in my case, sometimes years.Report

              • Avatar Mike Schilling in reply to James Hanley
                Ignored
                says:

                “So which of those irrational people are you going to put in charge of controlling the markets?”

                “The Securities and Exchange Committee. It’s not a perfect system, but we see over and over again how much worse the alternative is. By the way, did you get another ticket from driving on the left side of the road?”

                “I’m going to keep doing it until those fishers accept that the most efficient traffic patterns will be emergent instead of imposed, dammit!”Report

              • Avatar Glyph in reply to James Hanley
                Ignored
                says:

                This seems relevant: http://www.newyorker.com/online/blogs/frontal-cortex/2012/06/daniel-kahneman-bias-studies.html

                Short version: the ‘smarter’ you are, the more prone to irrationality you may be.

                So obviously, we need to put the dummies in charge.

                There is no evidence that this has not already occurred.Report

    • Avatar Roger in reply to Patrick Cahalan
      Ignored
      says:

      Patrick,
      In what way are staple goods such as food, shelter and such not positive sum goods? If we gathered these things from the wild I would agree with you. In general we produce them. This involves division of labor, specialization, economies of scale and comparative advantage. These are all positive sum processes that apply to staple goods.

      Or am I just not following?Report

      • Avatar Will Truman in reply to Roger
        Ignored
        says:

        There is a definite zero-sum aspect to shelter, insofar as wealthy people can cost non-wealthy people out of their homes. I mean, if you happen to own one of those homes getting bought out, you benefit. But if you want to live there, despite being able to afford the materials and labor for the house you would buy, and can’t because the cost of the land itself is so expensive… get my meaning?

        Your ability to get *a* house may not be zero-sum, but your ability to be able to get a house near your work, with a good school system, and so on… has a definite zero-sum element.Report

        • Avatar Patrick Cahalan in reply to Will Truman
          Ignored
          says:

          This is part of it.

          Since money is a proxy measurement, it’s not precise. This is an advantage in many ways; I don’t have to care what Roger wants to do with this dollar I’m about to pay him for that lollipop.

          However, it matters when the value of the dollar is significantly different to the agents who possess them.Report

        • Avatar Roger in reply to Will Truman
          Ignored
          says:

          Will,

          There is always a zero sum component to economics buried within the larger positive sum game. Consumers bid against each other for goods, employers bid for employees and do forth. If I had more space I would have added this to my piece.

          Markets do respond to this though by attempting to increase production or to create new alternatives. Scarcity drives up prices, and higher prices signal profit opportunities by finding new solutions or efficiencies. Markets are complex adaptive problem solving systems designed around serving the needs of the consumer.Report

          • Avatar Kimmi in reply to Roger
            Ignored
            says:

            yeah. drop me some stats on where the memory infrastructure for Iphones has gone in the year past the tsunami. ain’t gone nowhere has it? yeah, these markets are solving problems so well, ain’t they?Report

            • Avatar Will Truman in reply to Kimmi
              Ignored
              says:

              Could you rephrase this in a way that I can understand it?Report

              • Avatar Kimmi in reply to Will Truman
                Ignored
                says:

                An ideal market (one without startup or localization costs (that’s the whole “electronics work best in temperate climates”) would react to a disaster (that destroyed supply) by creating new sources of supply.
                We don’t live in an ideal world. Supply and demand still hold, but economies of scale, startup costs, and governmental shenanigans distort our market.

                Also, disasters tend to be short-term supply disruptions (5 years tops)Report

  12. Avatar Creon Critic
    Ignored
    says:

    I’m fascinated by the idea of a kind of rupture that occurred where there’s an expansion of positive sum interactions and a dramatic reduction in zero sum interactions – particularly encountering this, “Those that are well off probably became so at expense of the less well off.” In very many instances, isn’t this a historical fact? There a lot of former subjects of the British Empire and Native Americans who can attest to the fact that an awful lot of dispossession occurred to yield the world as we see it today (taking the grand historical view).

    Therefore, the wealthy are morally suspect and the poor are probably victims.

    You present one particular avenue for arriving at similar conclusions, but an alternative is to say that there’s a dispute about desert. Personally, I tend to be sympathetic to the luck egalitarian view. So instead of putting it the way you have, I’d say the wealthy are lucky and the poor are unlucky (to vastly oversimplify a particular distributive justice outlook for the sake of a comment box). What flows from that proposition, lucky or unlucky, is quite a great deal of effort in interrogating and assessing inequality. What ways it reproduces itself and what knock-on consequences it has for the community (health disparities, inequalities of opportunity, and capability deprivation).

    Progressive thinking can and does kill progress.

    I think part of the reason you may get intemperate replies – and this is not to excuse them – is that this sort of statement requires a lot of teasing out that I don’t really see here. That and James Hanley’s complaint that those unsympathetic to an outlook aren’t doing their best to contend with strong cases/instances. Crude egalitarianism, tall poppy syndrome, is not the way to go – ok, point proven. But that argument tells us less about the accounts of justice, desert, inequality that are on offer here. I mean, we could take a poll of how many progressives/liberals think your account represents them fairly or accurately. I can tell you for my part you’re minus one vote.Report

    • Avatar Roger in reply to Creon Critic
      Ignored
      says:

      Creon,

      I agree that zero sum, win lose interactions have been the historic norm, especially on the part of elites. That is why humanity never progressed; we just stole from each other, losing ground in the process. As we learned to do more mutually beneficial interactions, world prosperity exploded like never before. Virtually all human economic progress has occurred since Adam Smith. Whatever advances we had before that were offset by Malthusian factors. To the extent we continue stealing from each other, I believe we will continue to limit prosperity.

      Lucky how? In free markets they are lucky to have added value to others in ways which people are willing to reward them handsomely. I am absolutely sure luck is a matter of importance. But it isn’t something I recommend. Instead I recommend trying to understand your customer, or think of more efficient ways to meet their needs, or changing tactics when the current one seems to fail. In other words, markets tend to reward those that solve problems best for others.

      Because the threat of bad luck is real, I also believe we should build safety nets. It is in the best interest of all players to agree to safety nets before they start playing the game. Don’t overbuild though, or their is no point in playing the game. If you rig the game ahead of time to get fairly equal results, you will tend to suppress the incentives to solve problems and produce solutions.

      I do have more to say on the problems of equality, which I do believe are real. This was more of a stage setting piece.Report

      • Avatar Kimmi in reply to Roger
        Ignored
        says:

        Do you really believe that a Walmart cashier is worth half as much as a Costco cashier? Because I’ll stand and stay right now, that’s not true. The Waltons are getting rich/er by not paying their employees full value. Thing is? Most rich people are like that. Take debtors prisons, and forced free labor. Both are becoming fads in the south.Report

        • Avatar Roger in reply to Kimmi
          Ignored
          says:

          Kimmi,

          People are not paid what they are worth any more than we buy things for what they are worth. This line of thinking assumes there is an objective worth to start with that economics can discover.

          Cashiers are paid what supply and demand dictate in a free market. Supply meets demand where no equal potential employee will take the same job for less and where no potential employer will entice them away for more. The same is true of managers, investment dollars and fritos.

          If two firms pay vastly different amounts for the exact same resource, then you have a distorted market, probably due to the union. The effect of the union distortion is to prevent someone who would be willing to do the same job for less from doing so. The prevented worker is the injured party. Of course a person not being hired is invisible to everyone. Even the unemployed person. They know they are unemployed, but they do not know the union rule put them out of a job. It is totally opaque.

          The effect of union increases of wages above the going market rate is higher prices, more unemployment, lower returns and less efficient economy. This is what I mean by zero sum thinking.Report

          • Avatar Jesse Ewiak in reply to Roger
            Ignored
            says:

            Yes, we all know the worst injustice in the history of the world is than a mere employee might be making one penny more than his market rate.Report

            • Avatar M.A. in reply to Jesse Ewiak
              Ignored
              says:

              To Roger, any system that involves wages not racing to the bottom for everyone but the top 1% is an “unfair” system because it doesn’t devolve into serfdom.

              His words: “The effect of the union distortion is to prevent someone who would be willing to do the same job for less from doing so. The prevented worker is the injured party.

              What Roger fails to acknowledge is that this isn’t how hiring works in America. Very few people are able to go to some “job market” and start low-bidding for cashier work or secretarial work or night-shift work. People apply for open positions with a resume, and maybe they attach a “this is what I’d like to be making” note to it, but at the end of the day the potential employer makes a take-it-or-leave-it offer.

              The entire system is asymmetrical, and the information on what competing workers are offering to work for is missing. Unions actually change this by ensuring that workers CAN compare notes; collective bargaining lets the potential employees and actual employees engage in positive, full-information discussions regarding a fair wage.

              The effect of union increases of wages above the going market rate is higher prices, more unemployment, lower returns and less efficient economy.

              Actually, the effect of union bargaining is to cause wages to equal a fair market rate, as opposed to a depressed closed-bid and asymmetrical lowball rate created by a completely asymmetrical lack of bargaining power and a completely asymmetrical availability of information. This results in more workers being able to maintain stable homes, stable families, stable relationships, stable communities, and be able to buy products at reasonable prices related to the labor put in each day. This also results in more workers being hired to produce goods, rather than workers being treated like disposable cogs to be worked to death in long hours full of unpaid overtime until they either burn out or fall dead of a heart attack.

              That’s the reality, not this insanity Roger’s peddling.Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                MA,

                You are only looking at half the equation. There are also multiple potential employers. These compete, driving wages up. Bargaining asymmetry is not a critical issue. That is the wages we are paid.

                This is way off topic though, as you guys are basically just arguing against basic economics.Report

              • Avatar Kimmi in reply to Roger
                Ignored
                says:

                not at all. you fail to understand economies of scale, and the odds of two employers staking out different bands of “potential employees”

                YOU SAY A MONOPOLY CAN’T EXIST.

                Very well.

                300,000 people live in my city. There are two hospital systems.

                One systematically pays floor nurses less than the other. By doing so, they have both created a monopoly. You see, one hires fewer skilled nurses, and the other hires more, less skilled ones.

                Nursing, at least for emergency rooms, or floor nurses, is something that is relatively elastic — people get jobs in it because they like being a nurse, or because they spent a lot of money to become a nurse. So let’s not bother talking about them getting a job working for BNY Mellon.Report

              • Avatar M.A. in reply to Roger
                Ignored
                says:

                There are also multiple potential employers. These compete, driving wages up.

                Except that in most of the market, they don’t compete. Not really. Applicants, again, are offered take-it-or-leave-it job offers. Due to asymmetrical information and asymmetrical bargaining power, there is zero incentive for companies to compete against what another company is paying for jobs that aren’t already top-1% jobs.

                The choices given to the vast majority of applicants are to either take the terms as offered, or walk away and starve.

                The solution, as even DensityDuck admitted, is unionization. But unionization only works when there are controls to prevent free-rider syndrome. And for more than 3 decades, the goal of the top 1% has been to break unions and enact policies to stop unions from forming.

                “Right to work” states ought to be named “right to abuse” states. You can be fired for even being caught DISCUSSING unionization with your workers. You can be fired for discussing your pay with workers. Policies in Republican Serfdoms are literally designed to destroy the rights of workers to equal employment opportunity and advancement opportunity regardless of race or gender; to destroy the rights of workers to find out whether or not they are being discriminated against in pay; to prevent workers, at all costs, from finding out what others in the market are being paid or to collectively bargain for fair pay and benefits.

                The problem isn’t “basic economics”, the problem is people like you who deliberately support a system of such asymmetrical power that the “free market” you claim to love so much ceases to exist. In a “right to work” state, almost nobody ever can bargain with their employer for a raise, for some more time off. Nobody can ever complain about being forced to work unpaid overtime – you’ll just be fired for it.

                Totally asymmetrical allocation of force, handed all to the 1% or less. Something libertarians ought to oppose, except that it’s not “government.”Report

              • Avatar Kimmi in reply to M.A.
                Ignored
                says:

                take it or leave it offers, from employers to employees or vice versa, are the epitome of an opaque market.Report

              • Avatar M.A. in reply to Kimmi
                Ignored
                says:

                Looks like Roger just ran away from the point rather than address it. How typical.Report

              • Avatar Roger in reply to Kimmi
                Ignored
                says:

                See my response to teacher and you guys above. I don’t have time to respond to snipes. If you guys want to discuss something let me know.Report

              • Avatar Kimmi in reply to M.A.
                Ignored
                says:

                The idea that the job market is free or open is really, really dumb.

                Yes, you get an offer. If you’re good, you renegotiate, using their lack of information on you to pull a higher price.

                Roger, what part of this sounds free and open? There is little arbitrage in job markets…Report

            • Avatar Roger in reply to Jesse Ewiak
              Ignored
              says:

              One penny more or less is the definition of lack of efficiency in an economy. Add up enough and you have a totally dysfunctional market. See what I mean… Progressive thinking leads to the death of progress. Soon things cost too much, everyone is unemployed and we run out of other peoples money.Report

          • Avatar Kimmi in reply to Roger
            Ignored
            says:

            You are vastly more naive than I thought. When walmart creates a defacto monopoly by driving all its competitors out of business, then you’ve not got a free market, am i right?Report

            • Avatar Roger in reply to Kimmi
              Ignored
              says:

              Yes, if there was only one employer in a community free markets would not apply. Monopolies are inherently unsustainable in large open free markets. The accusation to the contrary is totally bogus. Let’s not go there though.Report

              • Avatar Kimmi in reply to Roger
                Ignored
                says:

                Yes, sir! yinz ought to come down here and I’ll show you exactly how large, open, and free this fucking American market is.

                Just south of here is what the state troopers call Fayette-nam. Ya ought to visit.Report

              • Avatar Rod in reply to Roger
                Ignored
                says:

                Define “large open” free markets. In my neck of the woods Wal-Mart likes to open a supercenter in precisely those kinds of towns that simply aren’t large enough to sustain a competitor (such as Super K-Mart, for instance). It’s not exactly a monopoly but on average every Wal-Mart location displaces something like 100 small businesses. It’s like every minimum wage-level job they provide comes at the cost of a small capitalist.

                Why do you hate capitalism? Don’t you want a lot of capitalists?Report

              • Avatar Roger in reply to Rod
                Ignored
                says:

                Rod,

                Yes, as markets grow they eliminate inefficient businesses. Those are the facts of capitalism. The inefficient craftsman or shopkeeper is required to redirect his efforts into different and more productive pursuits. Capitalism requires change.

                The consumers benefit with lower prices. The shopkeeper is harmed short term by lack of opportunity to do what he previously did inefficiently. Therefore he must go into a productive, efficient pursuit.

                In a brief sentence you have highlighted why people try to repress economic prosperity.Report

              • Avatar Mike Schilling in reply to Roger
                Ignored
                says:

                Yes, as markets grow they eliminate inefficient businesses.

                Where “inefficient” is defined as “those which are eliminated”.Report

              • Avatar Roger in reply to Mike Schilling
                Ignored
                says:

                Mike,

                No. Inefficient is described as those which are less efficient at solving consumer problems in the opinions of consumers. Consumers decide who is best at solving their problems, and when they no longer buy from those they decide against, the inefficient assets and people are released to do something more efficient a defined by the consumer.Report

          • Avatar Morat20 in reply to Roger
            Ignored
            says:

            So, like have you ever LOOKED for a job? Or are you American?

            Because I compare your theory with the reality, and I the two aren’t even in the same universe.

            Every job I’ve had for the last decade and a half? Fireable offense for discussing your compensation package with coworkers. And they meant it, too. So while my bosses had detailed information not only on who made what — but what potential employees would accept — I knew nothing beyond what they told me. Which was how much they’d offer.

            Get another job? They won’t tell me either, other than ridiculously broad salary bands, unless I got an actual offer. My bosses knew it too — so saying “X will pay me more” wasn’t leverage — it was hilarious, though. Maybe X would, maybe X wouldn’t — I’d have to quit and get hired on somewhere else to find out.

            Here’s another place libertarians tend to go off the rails — your theory doesn’t meet American reality. I’m sure there are some odd-ball fields (some parts of IT and CS used to be that way) where you can negotiate with employers like that — but to 99% of Americans? It’s not just inaccurate — it’s ALIEN. Bluntly put, unless you’re good enough (and that is very, very, VERY good — top 0.1% in your field good) or your skill set rare enough (and that is very, very rare) you don’t apply for jobs that way! You don’t discuss compensation that way!

            The rare class of workers who are not upper-management but are head hunted? Maybe that applies.

            And yet here you are, blithely discussing how compensation should worked based on a theories that don’t apply to the average American work experience! It’s about as Ivory Tower as it gets.

            Your theory breaks down — not just with things like the fact that we’re discussing real cows, and not spheroids in a vaccuum — but against the ultimate test: Reality.

            You talk about how employment SHOULD work and people look at you and say “Nobody applies for jobs like that. NOBODY”. That should be a wakeup call, dude.Report

            • Avatar Kimmi in reply to Morat20
              Ignored
              says:

              I know a guy with a nominal salary of 100,000 a year. But he doesn’t work for money often.Report

            • Avatar Mike Schilling in reply to Morat20
              Ignored
              says:

              Every job I’ve had for the last decade and a half? Fireable offense for discussing your compensation package with coworkers.

              Yes. Employers seem to believe that bargaining power is important and do their best to withhold the information that would help equalize it. Someone needs to teach them some economics.Report

            • Avatar Roger in reply to Morat20
              Ignored
              says:

              Morat,

              Not sure if you are still tracking, but I thought I would add something.

              I have hired or had hired hundreds, possibly thousands of people over my career. But you know what? If one of my supervisors referred a candidate to me for employment that so fundamentally misunderstood markets as some of the more vocal progressives do on this site, that I would never let the manager hear the end of it. Everyone would wonder who let this fool in through the front door? People who actually make decisions that affect profit and loss cannot afford to live under progressive delusions. They would be incapable of establishing a wage, or a price or an effective marketing strategy.

              Have you guys ever considered that the reason you are not in demand is that you are functionally worthless? You’ve brainwashed yourselves to obsolescence.Report

            • Avatar Mark Thompson in reply to Morat20
              Ignored
              says:

              @Morat20: Hopefully, you’ll catch this, but when you wrote: ” Fireable offense for discussing your compensation package with coworkers…”

              ….It occurred to me that a policy of this nature might be viewed as an unfair labor practice under the Wagner Act, at least as interpreted by the current NLRB. I’m not a labor lawyer, this is not advice, and I’m just going off of a CLE I took a few months ago, but as I understand it’s generally a violation of the Wagner Act to prohibit employees from discussing working conditions with each other. Unless there’s a specific exception to that rule for discussing salary, I assume what you describe fits within “discussing working conditions.”Report

              • Avatar M.A. in reply to Mark Thompson
                Ignored
                says:

                “At Will Employment.” They don’t have to tell you why they’re firing you.Report

              • Avatar Mark Thompson in reply to M.A.
                Ignored
                says:

                That wouldn’t matter here – a Wagner Act violation of this sort exists regardless of whether you’re employed “at will,” much like “at will” employment doesn’t make it legal to fire someone because of their race, religion, etc. More importantly, at least under the current NLRB’s interpretation, it doesn’t matter whether you’re in a union or even consciously trying to form a union; it’s the policy that’s illegal.Report

              • Avatar M.A. in reply to Mark Thompson
                Ignored
                says:

                Prove they fired you because a manager overheard you discussing salary, rather than they “decided to go in a different direction” or were looking for an excuse to fire someone so they could hire the CEO’s nephew instead.

                This is why “at will employment” and “right to work” are licenses for abuse. You can hide almost any level of discrimination and otherwise-illegal retaliatory practices behind them.Report

              • Avatar Mark Thompson in reply to M.A.
                Ignored
                says:

                For unfair labor practices charges, the existence of the policy itself can be a violation of the Wagner Act; termination or discipline for violation of the policy would presumably be a separate charge.

                Proving motive in unlawful termination cases is obviously never easy, and I’m quite certain that there are more unlawful terminations on which legal action is never pursued than there are unlawful terminations on which it is pursued, but this doesn’t really have much to do with “at will” employment, and definitely not “right to work” laws (which I agree are terrible laws; they’re just not relevant to proving unlawful termination). As a practical matter, making out a prima facie case of employment discrimination or retaliation is quite easy (at least outside of the Wagner Act context; I’m not familiar enough with Wagner Act cases to comment on proving a termination in violation of that): were you a member of a protected class or engaged in protected activity? Were you the object of an adverse employment action? Etc.

                Of course, the employer then usually responds with “yeah, but you were fired because your TPS reports sucked.” In other words, they’re going to respond with something to the effect of “we fired you for cause,” at least in most cases. Otherwise, they’ll just about always go with “you were laid off.” You have to show that these reasons are a pretext, which is not going to be easy, but you’re going to have that same problem regardless of whether you’re “at will” suing for discrimination or covered by an employment contract allowing only “for cause” terminations and claiming that cause was lacking.

                Sure, the employer might instead say in an “at will” case that they fired you for some other reason, like nepotism, but as a practical matter, they’re not going to want to cop to that.Report

              • Avatar M.A. in reply to M.A.
                Ignored
                says:

                In “at will” states, they are not required to provide a reason as long as they don’t check the “fired for cause” box.

                So you’ll get unemployment benefits, but you’re still fired for talking about unionization or comparing pay.

                The problem with laws like this is they completely defang federal laws regarding unionization and freedom of association. Sure, you can SAY there are laws against firing people for discussing unionization or comparing pay, but how the fish do you enforce it?Report

              • Avatar Morat20 in reply to Mark Thompson
                Ignored
                says:

                Considering it’s a standard and open policy? I suspect it’s quite legal.Report

              • Avatar Mark Thompson in reply to Morat20
                Ignored
                says:

                You’d be surprised. Also, keep in mind that this particular interpretation to which I refer may be fairly new policy (I’m not entirely certain), and it’s an area of labor law that seems to be rapidly evolving (again, from what I understand from my CLE). The phrasing of the policy is also important, and obviously I don’t have access to that.

                The specific report I have in mind is available here: http://nlrb.gov/publications/operations-management-memos

                Go to the 2011 document entitled “Report of the Acting General Counsel Concerning Social Media Cases.” It’s specific to discussions via social media, but it’s pretty clear that the rationale applies with at least equal force to just about any discussion in which multiple employees are involved. As I said above, I just don’t know if there are separate rulings or policies that somehow exempt employee pay from the definition of the phrase “terms and conditions of employment.”Report

              • Avatar Matty in reply to Mark Thompson
                Ignored
                says:

                You seem to be understating your case, when I look at that link there is a document with the same title dated May 30, 2012 that says.

                The Board has long recognized that employees have a right to discuss wages and conditions of employment with third parties as well as each other

                This seems pretty clear, the author considers it a protected right to discuss pay with each other and with third parties like unions.Report

              • Avatar Mark Thompson in reply to Matty
                Ignored
                says:

                As I said, I was just going off of a CLE I took a few months ago, so I hadn’t looked into that issue enough to find that reference. Obviously, that confirms my assumption – thanks for digging it up.Report

              • Avatar Morat20 in reply to Matty
                Ignored
                says:

                Someone should tell Lockheed that. And UTC. I mean, sure, tiny little provincial companies like that might not be up to date on HR policies. 🙂

                Seriously, I’ve worked for both — and have passing familiarity with a handful of other large companies (Jacobs, for one) with the exact same policy.

                I can’t quite feel it’s just a Texas thing. Those aren’t penny ante companies.

                So maybe it’s against the law, maybe it isn’t. But it IS how it actually is. Those are the policies. They enforce them, and even if I knew they weren’t legal — I’m not so sure I’d want to gamble my job on it.

                hmph. Yet another reason unions start to look a bit better.Report

      • Avatar Jesse Ewiak in reply to Roger
        Ignored
        says:

        Luck is that Bill Gates was born to a well-off lawyer and as a result, was able to go to a private school that actually had computers instead of say, being born to a coal miner and his wife in rural Kentucky.Report

        • Avatar Mike Dwyer in reply to Jesse Ewiak
          Ignored
          says:

          The coal miner’s kid gets a $5500 Pell grant. Tuition at a public university is around $6,000 in KY.Report

          • Avatar Jesse Ewiak in reply to Mike Dwyer
            Ignored
            says:

            I’m talking about when Bill Gates was actually born. So, was there was a lot of easy access to terminals and other large computers for high school kids in rural Kentucky in the late 60’s?

            But, even today. A upper-middle class kid has easy access to after school sports an activities, private tutoring for SAT’s, and a stable home life. The kid in poverty has to come to school wondering if the power will be on when he gets home, has to get a part-time job at 16 to help pay the rent, and when he graduates, probably has to take out student loans even to go to a public university in much of the nation. If you don’t think that has an effect, even if both kids have an equal reservoir of brainpower, then you and me are living in different worlds.Report

            • Avatar Mike Dwyer in reply to Jesse Ewiak
              Ignored
              says:

              “The kid in poverty has to come to school wondering if the power will be on when he gets home, has to get a part-time job at 16 to help pay the rent, and when he graduates, probably has to take out student loans even to go to a public university in much of the nation. If you don’t think that has an effect, even if both kids have an equal reservoir of brainpower, then you and me are living in different worlds.”

              That was basically my story and somehow I managed two bachelor’s degrees.

              But there IS inequality in education, which I am actually addressing in my synposium post.Report

              • Avatar Morat20 in reply to Mike Dwyer
                Ignored
                says:

                Don’t confuse anecdote with data.

                Heck, you want to get into the problems with school reform movements? It’s the mistake you just made. “It worked this one time! Surely it’ll work for everyone!”.

                People make a movie about how one teacher in one crap school district taught kids calculus, and then try to move it district or nationwide — and it collapses. Because, hey, sometimes the long-shot comes in, eh?

                But big things — likes like the population of the US — work statistically. Sure, some long-shots win. But most lose. It’s why they’re long-shots.

                An occasional poor guy will win the lottery. I’m not going to tackle poverty by handing out lotto tickets.Report

              • Avatar Mike Dwyer in reply to Morat20
                Ignored
                says:

                Morat – the feds give out millions of Pell grants yearly, not to mention state aid. My story is easily repeat-able.Report

              • Avatar Morat20 in reply to Mike Dwyer
                Ignored
                says:

                You mean the Pell grants that have shrunk in real terms? For the tuition rates that have skyrocketed as states yanked back funding from public and community colleges?

                Your story isn’t repeatable, not unless you were sitting on three or four times the money you needed.

                It’s all borrow, borrow, borrow now. Affordable college? That’s SO ten or twenty years ago.Report

              • Avatar M.A. in reply to Morat20
                Ignored
                says:

                For the tuition rates that have skyrocketed as states yanked back funding from public and community colleges?

                +1, a thousand times over.

                A “state university” used to be 50% state funded. Now they’re lucky to be at 15%; the outliers, the big flagships, might get 20% if the governor’s an alumnus.Report

      • Avatar Creon Critic in reply to Roger
        Ignored
        says:

        Lucky how?

        Luck in respect of the suite of skills you have and the circumstances surrounding you. So in skills you have, it isn’t clear that becoming tall and possessing excellent spatial intelligence are the individual’s doing. They make a contribution to developing their abilities, so some of their achievements in sporting are attributable to their work, but some of their achievement is attributable to a kind of lottery. Another axis of luck is the resources around you – middle class parents who value education and have the resources to put a child through college debt free, pretty lucky; on Harvard’s Z-list, even luckier still. Also, there’s the more obvious example of being born in a developed country or a least developed country – what kind of infrastructure one’s forebears were able to put into place. In the US, we’re definitely the beneficiaries of previous generations’ investment in infrastructure, again pretty lucky.

        Not being able to choose one’s parentage, geography, or skill set at birth – these sorts of building blocks impacting how one’s life proceeds are down to luck. Now, the story doesn’t end there I’d hasten to add. Individuals contribute important stuff to this mix of my analysis of desert. But free markets don’t spring from some ideal space absent this history of dispossession and these moorings to luck. It’s a well trod argument that part of government/community/society’s job is to take account of these factors – and hence suspecting inequality and its consequences.Report

        • Avatar Roger in reply to Creon Critic
          Ignored
          says:

          Creon,

          I dont think I originally perceived how deep your original insights were. I am pretty sure we don’t agree completely, but I do suspect our views overlap more than you would expect from this OP.

          As I have mentioned several times through the threads, this was not actually my inequality submission. It was establishing a foundation for the concept of positive vs zero sum worldviews, which I do reference in my OP on inequality. Erik felt it would work well to get the discussion going.

          I agree that people differ dramatically in the lottery of luck. I agree that differences in luck will lead to vastly different outcomes. And I agree that there are things we can do personally and institutionally to improve luck or minimize its effects. Indeed, I believe we have a class of people that are becoming increasingly stuck in poverty and that culture and our institutions are actually making this immobility worse. You know I am a fan of well designed social safety nets. I am not a fan though of poorly designed safety nets that risk creating dependency and incentivizing cultural behaviors that may lead unintentionally to dysfunctionality.

          I also believe – getting back to this post- that an important insight of Adam Smith is that we can build institutions in such a way that luck is used to help the less lucky. He called it an invisible hand. I call it mutually beneficial.Report

  13. Avatar balthan
    Ignored
    says:

    I see things differently.

    A typical progressive goal is not to provide equality of outcomes, or even equality of opportunity, but more of a baseline of opportunity. That through things like assistance for education, housing, and food, an environment can be created that allows the poorest to have the ability to better their situations, instead of merely struggling to survive. If someone must work multiple jobs to make ends meet, and can’t afford additional education or vocational training, they have little opportunity to improve their position, and are likely a single personal catastrophe away from being wiped out. If the poorest are able to generate more income, the economy and society as a whole will do better.

    I see that as positive sum.

    The loudest and most common counter-argument to that is that it’s wealth distribution. That you take from the rich and give to the poor and there are no other benefits.

    That seems zero sum to me.Report

    • Avatar Stillwater in reply to balthan
      Ignored
      says:

      The loudest and most common counter-argument to that is that it’s wealth distribution. That you take from the rich and give to the poor and there are no other benefits.

      That seems zero sum to me.

      Excellent point. Devilishly excellent.Report

    • Avatar North in reply to balthan
      Ignored
      says:

      That is really well done dude.Report

    • Avatar Roger in reply to balthan
      Ignored
      says:

      Balthan,

      I too see investments in education and various social safety nets as important for prosperity. A society with these things will thrive and those without will wither, IMO.

      I have absolutely zero concern with wealth redistribution. I have concerns with coercive, involuntary wealth redistribution.

      I believe there are dozens of ways to make redistribution voluntary. If anyone is interested, I can share. And the list doesn’t start with “charity” I believe the key to prosperity is where the interest for the egoist, the altruist and the utilitarian overlap. That is the path to social progress.Report

      • Avatar Jesse Ewiak in reply to Roger
        Ignored
        says:

        Right, investments in the social safety net are OK, as long as teachers have to work ’til they’re 70 and pay just as much as the private sector does for crappy insurance.Report

        • Avatar James Hanley in reply to Jesse Ewiak
          Ignored
          says:

          Jesse,

          I’m sure you can provide a cite to where Roger said that?Report

          • Avatar M.A. in reply to James Hanley
            Ignored
            says:

            Start here.

            a special interest group in cahoots with politicians to siphon tax dollars into sweetheart union pensions.” That is the sum of Roger’s opinion regarding teachers – that being worked to 70+ years old and taking a real wage cut of 10% or more to bring your benefits “in line” with the way the private sector looks after 30 years of rape by the 1%, even knowing that you already had traded a relatively lower wage for the stability and benefits that had existed in the public sector, is not a problem.

            Every time Roger was asked to show examples of what he considered “abusive” about any existing labor agreement between public sector unions and government, the coward ran away from the discussion. I have no doubt this will continue.Report

            • Avatar Roger in reply to M.A.
              Ignored
              says:

              MA,

              I clearly agreed that I would engage you in dialogue if we could agree to drop the name calling and to argue with what was actually said by the other person, not what we would like to have heard the other one to say. You neither agreed to that nor changed your behavior.

              If you want a dialogue I am willing….Report

              • Avatar M.A. in reply to Roger
                Ignored
                says:

                Show examples of what he considered “abusive” about any existing labor agreement between public sector unions and government, or don’t.

                All you’ve done till this point is run away from the question, and I find that cowardly and dishonest on top of the ugly and disparaging insults you heaped upon a class of people, a number of whom number among my friends.Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                MA,

                Your first sentence started great. Then you managed to throw in two insults in the second sentence.

                The “abuse” of which the vice president of the local union is so distraught about is how government employees bargained with local politicians in San Diego for pensions which are substantially richer than that of the taxpayers. As an example, the chief librarian is making $234,000 per year in pension benefits. They underfunded them, thus enriching the union while hiding it from taxpayers. They also diverted funds to other projects, thus forcing a win lose situation. Either taxes go up, or benefits go down.

                Which part of this do you think was a good idea? You dislike the term abuse. What would you prefer to call it?Report

              • Avatar M.A. in reply to Roger
                Ignored
                says:

                As an example, the chief librarian is making $234,000 per year in pension benefits.

                I’d like to see how the formula gets there exactly, but I think I have a good guess. What was the chief librarian making per year prior to retirement? How much of that is part of the city’s deferred compensation plan, rather than just “pension benefits”? How much is the DROP plan? And I’m going to assume she hit the maximum vestment number in years.

                So let’s see: City Librarian, 2010, yearly salary: ~$170,000 according to SD records. Max compensation cap for full vestment at 90% (according to sdcers.org), so yearly pension possibly around $150,000 (we’ll use some nice round numbers and always rounding down).

                Add in Deferred Compensation options, available to all city employees. If taken for a long period, could be quite substantial. Many police officers avail themselves of options like this as well.

                Add in DROP compensation option, available to start 5 years before retirement. Defers accrual of 5 years of pension vestment, but if she started with the city in her 20s, she may have already maxed out at the 90% cap anyways. DROP can add up to $25k/year in pension.

                The math works and there’s no funny business going on as far as I can see; it’s in the right ballpark. Your assertion that it is “abusive” I must disagree with.

                They underfunded them, thus enriching the union while hiding it from taxpayers.

                By “they” do you mean the city politicians responsible for the budget? So the politicians – e.g. the employers – were involved in financial shenanigans?

                They also diverted funds to other projects,

                There’s that “they” again. The politicians? Do you mean that the politicians diverted funds that should have been going into the pension escrow to the politicians’ pet projects?

                Where does “the union” come into this?

                Which part of this do you think was a good idea?You dislike the term abuse. What would you prefer to call it?

                I never think financial shenanigans and embezzlement are a good idea. But you have yet to prove your assertion that this is related to the union, and your only figure about someone with a retirement pension “substantially richer than that of the taxpayers” is a rather high-paid city official (chief librarian, head of an entire library system) with longstanding (30+ years? 40+?) vestment in the pension program who took advantage of both the DROP and Deferred Compensation options.

                Now if you want to tell me Susan Golding, Republican mayor who was involved in embezzling pension fund money and diverting it to other city budget items, was being abusive then I’m willing to agree wholeheartedly. If you want to tell me the elected city officials who allowed embezzlement like this to go on, I’ll agree that’s abusive.

                But you’re going to have to prove to me that the unions did anything wrong still, because none of that is related to the unions.Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                MA,

                Great points.

                Here is what I said…

                “I live right down the road from the Wisconsin border and spend a couple of months a year in San Diego, but for the life of me have never heard even a faint semblance of a logical argument for why taxpayers would want to allow a special interest group in cahoots with politicians to siphon tax dollars into sweetheart union pensions. Is there actually an argument, or are you guys just fighting for your side?

                One of my best friends is the vice president of a private sector union in San Diego, and he is mad as hell at the abuse public officials have inflicted on tax payers in that city.”

                I guess we can argue whether taxpayers who still need to work when they are eighty (my friend) paying a pension of $234,000 for a retired head librarian is fair or just, or whether it qualifies as a “sweetheart deal.” My friend the private sector union official thinks it is.

                As I originally wrote, my friend’s anger and term “abuse” was indeed aimed at the public officials. I agree that it is entirely possible for wonderful caring union members each of which is the moral equivalent of Mother Theresa to get in dire straights in this kind of situation. Rent seeking is not illegal, and if the other side is doing it, it isn’t even considered immoral by most. It is still a bad idea. San Diego is a case in point.Report

              • Avatar Jesse Ewiak in reply to M.A.
                Ignored
                says:

                See, my idea is both the public sector employee and your friend who still has to work when she is 80 should both be guaranteed a good pension at 65.Report

              • Avatar M.A. in reply to M.A.
                Ignored
                says:

                I guess we can argue whether taxpayers who still need to work when they are eighty (my friend) paying a pension of $234,000 for a retired head librarian is fair or just, or whether it qualifies as a “sweetheart deal.” My friend the private sector union official thinks it is.

                And here’s my point:

                If not for the rape of the private sector by the 1%, your friend would NOT have to work at 80 years old. And as shown by the financial records of San Diego, if we look at controller’s office records and look up City Librarian for San Diego compared to most of the other positions – even the other “Librarian” keyword positions – the salary available is an outlier. If you sort San Diego by potential max salary, the categories of people above her are City Attorneys (who get paid immense amounts, and there appear to be a certain number of duplicate entries), Police/Fire chiefs, department heads of various city utilities, and city financial officers.

                Her salary’s commensurate – actually, rather low – for the head of an entire city services department. The people under her max out at $85k/year, rather than $173k/year (her max potential), for a Supervisor Librarian.

                Now, I’ve been able to find a source that – in among the partisan swear-fest – says her actual pay was $139,000 in her final year before retirement. But that may or may not be true, depending on whether he’s counting her gross pay before or after Deferred Compensation.

                Your assertion was “a special interest group in cahoots with politicians to siphon tax dollars into sweetheart union pensions.” You then presented as “proof” the pension for one of the highest paid city officials (overseeing the entire library system) as being what you considered outsized. If we go over here and look at a more median scenario, a police officer with 25 years who hasn’t taken DC or DROP, all of a sudden it doesn’t look so unreasonable to me. In fact, it appears to me that you have either parroted a dishonest misrepresentation of the situation based on a cherry-picked “fact” with no context, or else you have spun this yourself deliberately.

                You have failed to make a case that you built on insults and lies. I tell you again; your private sector union official friend’s beef ought to be with the way his union is treated by the companies, not with the public sector unions who – at worst case – have managed to negotiate the preservation of unions on par with what your private sector union official friend would have been able to negotiate prior to 30 years of anti-union legislation across the USA by TPoFYIGM.

                “Hey they didn’t get screwed as hard as we did, so we’re screaming that they needed to get fucked over too” is an invalid way to define a “sweetheart deal.”Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                Jesse,

                I support your desire to give everybody a great pension at 65. I do not support you using coercion to make this happen.

                MA ,

                I do not support rape within the private sector. My friend teaches part time at a university, but is self employed in giving music lessons and playing gigs. I don’t think he raped himself though.

                You guys both seem to want to manufacture wealth out of thin air. As I wrote yesterday, wages are set by supply and demand. I will add that failure to set wages by supply and demand will tend to lead to mis allocation of resources and less prosperity.Report

              • Avatar M.A. in reply to M.A.
                Ignored
                says:

                As I wrote yesterday, wages are set by supply and demand.

                And you ran off yesterday, refusing to engage the points of myself, Morat20, and others regarding how the job market really functions today.

                I think we’re done here. You’ve made this unfounded assertion time and again and you’re incapable of defending it.Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                MA,

                No, I had the last word on the topic. I wrote:

                Teacher, Kazzy, Morat, Kimmi and MA

                As I mentioned, I too suspect CEOs are manipulating the system to their advantage. But this would require a whole different post. Let’s just agree to agree for a change.
                FISH THE CEOS!

                That is why I shifted the discussion to management in general. Let’s call it the AVP in charge of Marketing Research. This persons salary is set by supply and demand. If the company tries to pay him less than his going rate, let’s call it $350,000 a year, then he is at risk of leaving to another company. Of course their are lots of Senior Directors at various firms that would love to do his work for less. Where these all balance out is what the firm pays.

                The same is true for all the sales reps in the AVPs division. Where supply meets demand, imperfectly, that is where firms will set their salaries. It makes no sense for them to impose a lower salary on the AVP to get a higher salary for all the sales reps.

                They also cannot arbitrarily increase their prices to offset higher sales rep salaries. The reason is that the price of their product is set by supply and demand too. Nor can they arbitrarily lower profit margins. Doing so will lead to penalization by the stockholders, in terms of share price, which is also set by supply and demand.

                I am stating all this based upon my experience actually involved in the setting of wages, salaries, commissions and prices. These are not theoretical issues. They are the exact issues that we dealt with and stumbled through in running businesses.

                Furthermore, if the AVP’s all got together and decided to donate half their salary to the sales rep salary fund, the result would actually be an inefficiency in the sales rep supply and demand. Let’s say they could double the hourly wage. The result would be a surplus of people wanting that job. After all the going rate is half that amount. This means that those that missed out on the job would offer their sevices for just under the double amount. Pretty soon, the company would either have to deny the job to those hungry candidates (which is unfair to THEM), or they would just lower it to the point supply meets demand.

                END QUOTEReport

              • Avatar Kimmi in reply to M.A.
                Ignored
                says:

                Roger, do you agree that for management and employees both there is information asymmetry and an opaque market involved in hiring/firing?
                I cited a monopoly example… do you agree or disagree with it?Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                Kimmi,

                I agree that the markets are not perfectly transparent nor perfectly symmetrical. They are imperfect. I don’t remember the monopoly example.Report

            • Avatar James Hanley in reply to M.A.
              Ignored
              says:

              M.A.,

              Roger never said teachers should have to work until they’re 70. If you want to demonstrate that somebody said something, you have to quote them saying it, not provide some oblique statement of theirs and say, “this is what they really mean.” It’s not an honest tactic.Report

              • Avatar Mark Thompson in reply to James Hanley
                Ignored
                says:

                It seems to me that the quickest way to derail a discussion without throwing out an ad hominem is to turn to some version of the “Shorter” meme.

                It seems to me that this would happen a lot less frequently if the person looking to deploy it were to simply phrase it as a question. In so doing, they’d make exactly the same point (except probably more effectively since it’d allow them a good chance to paint the object of their ire into a corner) without derailing the conversation.

                So instead of saying “Right, investments in the social safety net are OK, as long as teachers have to work ’til they’re 70 and pay just as much as the private sector does for crappy insurance,” it’s worlds more effective to ask “so are you suggesting that investments in social safety nets are OK, as long as teachers have to work until they’re 70 and pay just as much as the private sector does for crappy insurance?”Report

              • Avatar Jesse Ewiak in reply to James Hanley
                Ignored
                says:

                If one wants to destroy the system that allows public sector employees to have certain advantages (that the rest of the middle class used to have), I can only assume you want teachers to be stuck in the same state as the rest of us – working till we’re old hoping we don’t get to 65 or 67 or whatever the “new” Social Security age will be during a massive recession with a crappy health care plan that we’re paying larger and larger premiums for.

                If in fact, Roger is OK with teachers collectively joining together to bargain for a lower retirement age, a pension, and better health benefits, then I apologize. But, since he has continually called public sector unions leeches, parasites, and every other ugly bug on the planet, I doubt he does.Report

              • Avatar James Hanley in reply to Jesse Ewiak
                Ignored
                says:

                Jesse,

                When Social Security was created in 1937, the retirement age for it was 65. Today the retirement age for folks like you and me (born after 1960) is 67. (<a href="http://en.wikipedia.org/wiki/Social_Security_%28United_States%29#Normal_retirement_age&quot;

                For people born in 1937, life expectancy for men and women (respectively) was 58.0 and 62.4. That is, the "average" person born in 1937 could expect to never receive Social Security.

                For people born in 1960, life expectancy for men/women is 66.6 and 73.1 years, and for those born in 1998 the numbers are 73.8 and 79.5 years.

                Now of course life expectancy is primarily determined by infant/child mortality, but nonetheless, adult workers today are still more likely to live into their 70s and 80s, and to be active and healthy in those years. So comparing a retirement age of 67, or even 70, today to 65 back then, folks today are still more likely to receive SS for a longer period of time.

                I'm not sure that on net you and I have anything to complain about vis a vis our grandparents/great-grandparents' situation.Report

              • Avatar James Hanley in reply to James Hanley
                Ignored
                says:

                Sorry, here’s the source on life expectancy.Report

              • Avatar M.A. in reply to James Hanley
                Ignored
                says:

                “Bread and circuses for the poor are cheaper than ever. FYIGM.”Report

              • Avatar James Hanley in reply to M.A.
                Ignored
                says:

                FYIWY.Report

              • Avatar Jesse Ewiak in reply to James Hanley
                Ignored
                says:

                Except, there hasn’t been that much of a rise in life expectancy for those in the bottom quintiles, in other words, the people who actually need to retire at 65 because they’ve been doing nearly fifty years of labor.

                (http://krugman.blogs.nytimes.com/2010/11/10/income-and-life-expectancy/

                “Look at Table 4: since 1977, the life expectancy of male workers retiring at age 65 has risen 6 years in the top half of the income distribution, but only 1.3 years in the bottom half.”

                Plus, as Krugman says, life expectancy is rising, but not life expectancy at 65. When you get rid of things like polio, measles, and the like killing kids at seven, people will live longer.

                (http://krugman.blogs.nytimes.com/2010/08/13/live-long-and-prosper-2/)

                That’s even ignoring the point that as a nation, we’ve become far richer than the architects of Social Security could have possibly imagined. It would make perfect sense for us to give ourselves more leisure time, if we chose to take it, at the end of our lives.Report

              • Avatar James Hanley in reply to Jesse Ewiak
                Ignored
                says:

                Jesse,

                And what was the increase from 1937 to 1977? You’re selectively taking only the latter half of the time period.

                And, yes, poorer people die sooner. Always have, always will. It’s a suck-ass aspect of the world. But today’s poor people still live longer than 1937’s poor people.

                That’s even ignoring the point that as a nation, we’ve become far richer than the architects of Social Security could have possibly imagined. It would make perfect sense for us to give ourselves more leisure time, if we chose to take it, at the end of our lives.

                It’s also true that we’re paying for far more SS recipients than they ever imagined, so some tough choices have to be made somewhere.

                Look, I’m not making an anti-SS argument. I’m just arguing that raising the retirement age isn’t really that much of a burden on our generations. The system is really all about the number of workers per retiree, and that number has dropped dramatically in our time, and declining birth rates in America aren’t going to help with that problem. There are any number of solutions–raising contributions, reducing benefits, raising retirement age, mandating more children per couple, euthanize all the baby boomers, etc. My preferred option is to promote more immigration, at least until the baby boomer bubble has passed through (honestly, I think the system will be fine once they’re out of it), but that’s politically troublesome, too.Report

              • Avatar James Hanley in reply to Jesse Ewiak
                Ignored
                says:

                P.S., I’m trying to find the average length of time retirees receive SS today and in prior times. It would be enlightening to our conversation, whatever the data show. I can’t seem to find that info, but I’m pretty sure it’s out there. If you find it, please let me know or just put it out here yourself.Report

              • Avatar Roger in reply to Jesse Ewiak
                Ignored
                says:

                My recommendation for fixing SS is once again….choice.

                I would at a minimum require SS to pay for itself. I would raise premiums to make it sound and give people additional choices to avoid this rate increase by electing later retirement. It just adds more choice to a system that already has some choice built in.Report

              • Avatar M.A. in reply to Jesse Ewiak
                Ignored
                says:

                How about just not letting Congress raid SS for funding for their “unified budget” bullshit games, and putting back the money they stole from it in the 1990s?Report

              • Avatar Jesse Ewiak in reply to Jesse Ewiak
                Ignored
                says:

                Here’s something from the CEPR on retirement age and time spent working.

                (http://www.cepr.net/documents/publications/ss-2010-06.pdf)Report

              • Avatar Jesse Ewiak in reply to Jesse Ewiak
                Ignored
                says:

                And SSA numbers on life expectancy at age 65, which is really the only number the matters.

                http://www.ssa.gov/history/lifeexpect.htmlReport

              • Avatar James Hanley in reply to Jesse Ewiak
                Ignored
                says:

                How about just not letting Congress raid SS for funding for their “unified budget” bullshit games, and putting back the money they stole from it in the 1990s?

                That would help, and I’m all for it as a matter of principle. But it wouldn’t solve all the problems, although it would go a long way toward it.

                I’m not sure, though, that borrowing from SS only began in the ’90s. It’s always been a pay as you go program, and the surplus that has come in has always, as far as I know, been spent by Congress, even though it’s technically supposed to be off-budget.

                I’m open to correction on that, though.Report

              • Avatar James Hanley in reply to Jesse Ewiak
                Ignored
                says:

                Jesse, I did see those. They don’t directly answer the question, though. Decent proxy measures, but not quite the real thing.

                Not trying to diss you, though. I asked and you gave at least as good as what I was able to find. All I can complain about is that you couldn’t do better than me. 😉Report

              • Avatar Rod in reply to Jesse Ewiak
                Ignored
                says:

                I’m not sure, though, that borrowing from SS only began in the ’90s. It’s always been a pay as you go program, and the surplus that has come in has always, as far as I know, been spent by Congress, even though it’s technically supposed to be off-budget.

                I’m open to correction on that, though.

                I went over this once a few weeks ago, but here it is again:

                You’re correct that the SS system has historically been pay-as-you-go. Basically, current workers paying for current retirees. Back in the ’80s, trustees foresaw the “rabbit-in-the-python” demographics of the baby-boom generation and raised the alarm. Reagan, with Moynihan, crafted a plan whereby the boomers, starting in the mid eighties sometime and continuing today, would double-pay. They would pay for both their own retirement and the retirement of the folks already in the system.

                Consequently, the SS trust fund has built up a ~2.5 T $ surplus. That surplus is held in the form of special Treasury bills. They have a fixed interest yield, but are non-marketable. IOW, they can’t be sold, but rather have to be redeemed directly by the Treasury. Essentially, the SS trust fund is a creditor to the rest of the government.

                Now some would call that hinky. But what’s the alternative? Hold it all in a big savings account? Hide it under a very big mattress? Oh, I know! Invest it in the market! Wrong!! Putting aside the riskiness, would you really want the Feds to be stomping around in the equity and bond markets with 2.5 trillion dollars?

                So actually what happened is that the rest of the Federal government borrowed that money from SS instead of borrowing it on the open market. That freed up 2.5 T of private money–money that otherwise would have been borrowed by selling T-bills–to be invested privately by the private investors. Isn’t that better than having that investment money directed by government?

                And now, just about precisely on schedule, the rabbit is working it’s way through the python and SS outlays are approaching the point where they’re going to be larger than receipts. Exactly what was foreseen, and planned for thirty years ago. This is the “crisis” facing SS. A plan going exactly as… well, planned.

                Actually the crisis is that Congress can’t pretend any longer that the deficit is smaller than they’ve been telling us for the last thirty years. If they were being truthful they would have to admit that the only honorable way to deal with this is to increase taxes just slightly on the investor class to make up for the overtaxation of the working classes all this time. But they–and here I mean specifically and particularly, the Republicans–are constitutionally incapable of telling the truth.Report

      • Avatar Kimmi in reply to Roger
        Ignored
        says:

        coercive involunatry wealth redistribution isn’t always from rich to poor. it is often from poor to rich.Report

        • Avatar M.A. in reply to Kimmi
          Ignored
          says:

          See also: Wall Street bailouts.Report

        • Avatar Jesse Ewiak in reply to Kimmi
          Ignored
          says:

          No, no, that’s not wealth redistribution. That’s rewarding job creators.Report

          • Avatar Kimmi in reply to Jesse Ewiak
            Ignored
            says:

            no, it’s not about rewards. it’s about punishing people for being poor, by demolishing their houses, and then by giving them below -break-even employment at the company, which is now able to pay them less because the company has demolished their houses, and they are desperate for some place to live.Report

          • Avatar James Hanley in reply to Jesse Ewiak
            Ignored
            says:

            No, no, that’s not wealth redistribution. That’s rewarding job creators.

            Yes, libertarians actually held a holiday to celebrate the Wall St. bailouts….oh, wait, no they didn’t.

            Perhaps you’d be considerate enough to stop focusing on the fantasy libertarian you’ve got tied to your bed and start talking to us real live libertarians?Report

            • Avatar M.A. in reply to James Hanley
              Ignored
              says:

              When the best response the libertarians can ever muster up is “shrug, well the market will work it out eventually”?

              The problem with libertarians is that they are completely fixated on their one and only golden hammer, fixated on pounding down the “nails” of what they perceive to be government force. The fixation blinds them and makes them unable to realize that they’ve got a ball peen hammer when they need to start with the back end of a clawhammer.

              The nails of the 1% are splitting the wood of society. It needs the nails removed, a good helping of glue and an overnight in a clamp, not some libertarian-esque moron with a golden ball-peen pounding harder hoping to somehow knock the wood back together and just opening the split wider.Report

              • Avatar James Hanley in reply to M.A.
                Ignored
                says:

                M.A., you don’t actually know what libertarians are thinking and saying. You think you know, and so you’re not bothering to actually pay any attention to what they’re actually saying. But you have a very simplistic strawman vision of libertarianism.

                How would you like it if libertarians spent all their time here telling you what liberals believe, instead of listening to liberals explain themselves? That’s exactly what you’re doing, and it’s no less irritating, dishonest, and unproductive than it would be if we did it to you.

                If you’re not willing to let us libertarians explain ourselves, but are intent on explaining libertarianism to us, then I’m just going to type FYIWY in response to each of your comments. It’s the intellectual equivalent, which is to say, meaningless.Report

              • Avatar Rod in reply to James Hanley
                Ignored
                says:

                James, I’ve taken to simply ignoring a lot of M.A.’s posts and I don’t consider him much of an example of liberal thought. But that being said… pots and kettles, dude.

                Perhaps the libertarians could take a break from telling us what the “liberal worldview” is or what we “liberals think.” Fact is, you (meaning, libertarians on this blog) are just as adept at setting up strawmen liberals to bolster your arguments as anyone.Report

              • Avatar James Hanley in reply to Rod
                Ignored
                says:

                Rod,

                I try to avoid doing that. But to the extent I and/or others do it here, I think there’s a big difference in how it’s done. I don’t see libertarians here assuming all liberals are raging leftists who want to tear down the rich–whatever strawmen we erect, it’s not generally the “assume all liberals are the most extreme version” type. Which is why I note that using FYIW would be ridiculous. But in caricaturizing libertarians, it’s frequently an assumption that there’s only one true type of libertarian, the most extreme type. Hence M.A.’s FYIGM.

                Not all liberals here do it, by any means. Not even most. And some have done it and have become cool after I argued with them about it. M.A.’s new–call me a hopeless romantic, but I hope to push him past his current extreme strawman version of libertarianism so that productive conversations can ensue.Report

              • Avatar Kimmi in reply to James Hanley
                Ignored
                says:

                you might win more friends among M.A.’s type by citing Webb, or Tester or other democratic libertarians.
                Just saying.Report

              • Avatar Roger in reply to Rod
                Ignored
                says:

                Rod,

                I admitted to as much and explained why I was doing so. The point of the straw man was not to win the argument, but to clarify what I meant by zero sum outlook. I encourage progressives to counter my caricature or explain it.

                Where do you think it goes wrong…Report

              • Avatar M.A. in reply to James Hanley
                Ignored
                says:

                If you say I have the position wrong, then instead of just saying “no that’s not it”, explain what you think I’ve got wrong about it.

                I’m going on what you and the other libertarians on this blog post, and most of it comes up as religious “the market will provide” bullshit. And I have yet to see an actual definition or position on how your magical market fairies would deal with the kind of crippling coercive force exerted by a very few people upon most of the population today.Report

            • Avatar Jesse Ewiak in reply to James Hanley
              Ignored
              says:

              I’m not talking about the bailouts. I’m talking about thirty years of deregulation, loopholes, and giveaways. Of course, most libertarians will say they want to get rid of those horrible loopholes, but they’d just replace it with a straight super low tax rate for our Galtian overlords.Report

              • Avatar M.A. in reply to Jesse Ewiak
                Ignored
                says:

                +1, a thousand times.

                “I want to replace tax loopholes with a 10% tax rate” is like telling me you don’t have six eggs, you have a half dozen. Come back to me when you’re willing to eliminate the undeserved subsidization of tax loopholes for rent-seeking corporations while leaving the tax structure otherwise intact.Report

            • Avatar Mike Schilling in reply to James Hanley
              Ignored
              says:

              James, where did anyone you’re responding to to blame the bailouts on libertarians?

              In fact, I think you’d agree with the substance of much of what was posted:

              * Government transfers often make the poor worse off
              * They often flow to the privileged and connected, not those most in need
              * The Wall Street bailouts were morally indefensible

              I’ll make a further point I expect you will disagree with. The bailouts were motivated, not only by the influence of those bailed out, but by genuine terror of what would happen if they were all allowed to fail. You can posit that things would have cleaned themselves up, and that that would be preferable to the slow-motion collapses we’re still living through, but no one knows. This came about because:

              1. Many of these institutions were too big to fail without causing huge disruptions.
              2. There were so many at risk of failure because they were lemmings, following each other off the same cliff.

              Since human nature will not change anytime soon, nothing will prevent a recurrence of 1 and 2 but regulation. I don’t trust a refinery not to cut corners and endanger both its workers and its neighbors to make a few extra bucks — that’s why we have health and safety regulations. Why would I trust Wall Street?Report

              • Avatar James Hanley in reply to Mike Schilling
                Ignored
                says:

                I interpreted Jesse above, since he seems to think that’s how libertarians think. I’ll admit I could have interpreted him wrongly, and if he says I did then I’ll take his word for it.

                But, yeah, I do agree that it was a coercive redistribution upwards. That’s why I wasn’t comfortable with it. It may have been necessary, so I could never bring myself to unconditionally condemn them, but I was never fully persuaded that they were.

                Actually I wholly agree with you that the bailouts were motivated in part–and I’d even say it’s the larger part–by terror about what would happen. My fear is that by not letting that happen and suffering the pain we may just have propped up the same terrible approach that got us into this mess in the first place. Colloquially, I think perhaps we should have taken our medicine, rather than pretend we wouldn’t really ever have to. I hope I’m wrong about that.

                I don’t trust a refinery not to cut corners and endanger both its workers and its neighbors to make a few extra bucks — that’s why we have health and safety regulations. Why would I trust Wall Street?

                As for me, I’m not talking about trusting Wall St. I’m talking about trusting competition, which isn’t the same thing as trusting a corporation/an industry/a businessperson. Punish fraud, absolutely. Require as much openness as we reasonably can (the theoretical perfect market is dependent on perfect information). Then let the fuckers fail. We’ve got deposit insurance for mom and pop, and I’m cool with that. But the problem we have today is that we want to regulate so they can’t fail, which is a backasswards way of doing thing.

                I know people get freaked out when businesses fail, but those failures are a sign that the market is working right. If nobody is allowed to fail, the market will never work right. And then, predictably, everyone will bitch about how markets don’t really work, and they’ll never pause to look at whether it’s the regulations–the particular type, that is, not all regulation–that’s causing the problem.Report

              • Avatar Jesse Ewiak in reply to James Hanley
                Ignored
                says:

                Except there was a third option between letting 10-20% of the economy liquidate along with the retirement of hundreds of millions of American’s and giving the banks free money. Of course, it involved nationalization and such, but it would’ve stabilized the market without rewarding Wall Street or hurting the rest of the country even more.Report

              • Avatar James Hanley in reply to Jesse Ewiak
                Ignored
                says:

                Do you really think nationalization of banks would be good for the economy in the long term? Or do you mean temporary nationalization, like the purchase of GM stock?Report

              • Avatar Kimmi in reply to James Hanley
                Ignored
                says:

                it worked in sweden. krugman wrote a couple columns about it. and i’m pretty sure we’re all talking temporary nationalization.Report

              • Avatar Jesse Ewiak in reply to James Hanley
                Ignored
                says:

                As Kimmi said, temporary nationalization like Sweden did to effectively fully replace the management with say, evil public sector employees who work for the Treasury, and letting them work out the rot and then selling the banks back to the market after hopefully passing new regulations.Report

              • Avatar James Hanley in reply to James Hanley
                Ignored
                says:

                Thanks Jesse, I just wanted to make sure I understood you properly. As much as it goes against my grain, in the present case, solely because we had this goddamed too big to fail problem, I think that solution would have been worth considering. I’d need to read up a lot more on the issue to know where I’d come down on it, but I do think it’s deserving of consideration. At the least it would probably have been better than, “Well, we’ll bail you out this time (well, some of you, not all of you, with apparently random choice of who), but promise us you’ll never do it again.” I think that’s pretty close to the worst of all possible solutions.Report

              • Avatar Mike Schilling in reply to James Hanley
                Ignored
                says:

                Worse than that. “Please, take the money. Of course you can skim some off the top. I’m not judging you. Just keep on doing the same things you were doing before this .. Sarcasm? No, not at all. I mean it. I need you. We need you. Just take the money. I’m begging you.”Report

              • Avatar M.A. in reply to James Hanley
                Ignored
                says:

                I know people get freaked out when businesses fail, but those failures are a sign that the market is working right.

                When the market is in fact healthy.
                When there is enough control on the market to prevent monopolist abuses.
                When the failure is a result of a company failing to adapt to times, or being tied to an obsolete technology or service, or the result of a competitor providing the same good/service at enough of a difference in cost through advances in production means and not through amoral/illegal means.

                On the other hand, the “failure” of companies because they were bought up by corporate raiders and saddled with paper debt to line the pockets of vulture capitalists – is that a market “working right”? How about companies dying due to currency manipulation and product dumping by the Chinese, is that a market that is “working right?”Report

              • Avatar Kimmi in reply to M.A.
                Ignored
                says:

                has krugman, or any economist on the left, been bitching about currency manipulation and product dumping by the CHINESE???

                Last I heard, the worst currency manipulators were AMERICAN and BRITISH.Report

              • Avatar James Hanley in reply to M.A.
                Ignored
                says:

                M.A.,

                We could try moving past ideological bullet points?Report

              • Avatar M.A. in reply to James Hanley
                Ignored
                says:

                We could try answering the questions posed, as KTWard suggested?

                At this point you’re just trolling as far as I’m concerned.Report

              • Avatar James Hanley in reply to James Hanley
                Ignored
                says:

                M.A.,

                When there is enough control on the market to prevent monopolist abuses.

                Ideological talking point. Monopolies (or near monopolies) earn above normal profits, drawing in other greedy bastards who want a piece of the action, thus competing away the above normal profits. That’s basic economic knowledge; an assumption that monopolistic abuses are normal demonstrates a preference for ideology over analysis.

                product dumping by the Chinese,

                Also an ideological talking point. The Chinese have no benefit from dumping products. The fact that their products are lower priced comes from their lower cost of production, which is a consequence primarily of a labor force that is not yet fully mobilized.

                At this point you’re just trolling as far as I’m concerned.

                You know, for someone who is new to a blog and spends much of their time spouting insults, you really have no business accusing others of being trolls, which you’ve done to at least two people now (both of whom have been active participants here a lot longer than you). Spouting “FYIGM” is pretty much the definition of trollish behavior.Report

              • Avatar M.A. in reply to James Hanley
                Ignored
                says:

                Monopolies (or near monopolies) earn above normal profits, drawing in other greedy bastards who want a piece of the action, thus competing away the above normal profits. That’s basic economic knowledge;

                And yet we don’t see that in today’s markets, we instead see constant consolidation leading towards either true monopolies or trust-level, organized monopolist organizations like the RIAA, MPAA, airline industry, cell phone industry, and even back-channel hidden monopolies like much of the food industry (where for example the canned green beans under 5 different labels all came from the same factory and the same crop).

                Also an ideological talking point. The Chinese have no benefit from dumping products.

                Yes they do; the removal of US companies from the market competing with them. Chinese dumping of silicon-based solar panels was one of the main reasons Solyndra failed.

                (both of whom have been active participants here a lot longer than you).

                So it’s time served that gives them license to troll. I’ll keep that in mind.Report

              • Avatar Kimmi in reply to James Hanley
                Ignored
                says:

                ma, you could try answering my question above…Report

              • Avatar James Hanley in reply to James Hanley
                Ignored
                says:

                M.A.,

                I don’t know about you, but I have quite a few options for cell phones. As for the RIAA and MPAA, don’t you know the extent to which it’s been their lobbying of government for regulatory protections that’s allowed them to do what they do? Their position couldn’t stand in a less regulated market.

                As to dumping, the “drive them out” theory is an old one that’s never had much empirical evidence. Given the amount of technical expertise in the U.S., if China drove out every producer in a particular sector, once they tried to up their prices, we’d be able to dive right back into the market. The real push behind claims of dumping is classic economic protectionism–industries that find it hard to compete seek protection, in clash with the principles of absolute and comparative advantage, and without regard for the costs protectionism imposes on consumers.

                So it’s time served that gives them license to troll. I’ll keep that in mind.

                All righty, then. Matthew 7:3, my friend.Report

              • Avatar M.A. in reply to James Hanley
                Ignored
                says:

                Kimmi, Paul Krugman:

                In 1971 the United States dealt with a similar but much less severe problem of foreign undervaluation by imposing a temporary 10 percent surcharge on imports, which was removed a few months later after Germany, Japan and other nations raised the dollar value of their currencies. At this point, it’s hard to see China changing its policies unless faced with the threat of similar action — except that this time the surcharge would have to be much larger, say 25 percent.Report

              • Avatar Mike Schilling in reply to James Hanley
                Ignored
                says:

                Break ’em up into pieces small enough that they can fail safely, and let them die unlamented deaths. But assign any resulting debts to their principals, and reintroduce debtors’ prison. (Like the fella said, “Double Guantanamo.”)Report

              • Avatar Kimmi in reply to Mike Schilling
                Ignored
                says:

                no debtor’s prison. no free lunch for companies.
                it’s starting to become a fad down south, ya know?Report

              • Avatar James Hanley in reply to Mike Schilling
                Ignored
                says:

                As I’ve noted elsewhere, I’m nothing like an expert on finance issues, and I don’t pretend to be one, so anything I say in reference to financial institutions is based on very limited understanding. But I do think letting them get so big created a major problem, and that may be a reasonable target of regulation. I won’t pretend, however, that I know just that that regulation ought to look like. I wouldn’t want to go back to the days of banks not being allowed to be interstate corporations.

                I think, though, that we could avoid the cost of debtor’s prison and just put them in the pillory, allowing the public to throw whatever objects are handy at them.Report

              • Avatar Mike Schilling in reply to James Hanley
                Ignored
                says:

                allowing the public to throw

                Ahem. Charging the public to throw. What kind of libertarian are you?Report

              • Avatar Rod in reply to James Hanley
                Ignored
                says:

                I want the beer concession at such an event.Report

              • Avatar Mike Schilling in reply to James Hanley
                Ignored
                says:

                “How come the Schlitz costs more than the Sam Adams?”

                “Most people find that the cans are more aerodynamic.”Report

              • Avatar Kimmi in reply to James Hanley
                Ignored
                says:

                you’re starting to talk like crazy people talk.
                i do believe this is a good thing.

                (also, I really agree with you).Report

        • Avatar Roger in reply to Kimmi
          Ignored
          says:

          Agreed 100%.Report

  14. Avatar clawback
    Ignored
    says:

    So how would one apply the categories described here (zero sum vs. positive sum) to current policy debates? For example: if I want adequate funding for education as an investment in human capital, am I engaging in zero sum thinking? How about if I think the country’s infrastructure is inadequate and deteriorating, and that investment in that area would be worthwhile? Conversely, if I want to skimp on education and infrastructure in order to keep taxes low, am I coming at this from a zero sum or positive sum point of view? Similarly, if I want to gut Social Security and Medicare in order to finance tax cuts for the rich, is this considered a positive sum view of the world? Because I’m unclear on how these categories apply specifically.Report

    • Avatar Stillwater in reply to clawback
      Ignored
      says:

      My guess is that they don’t apply in any coherent way to taxes at all. Taxes are conveniently viewed by libertarians (and conservatives) as negative-sum by the payer since a rational analysis concludes (for them, anyway) that taxes decrease their subjectively determined utility (which is why they’re coercively imposed). So the analysis of what constitutes positive sum in the area of taxation has to include other factors than subjectively determined utility. A criticism like you’re putting forward highlights the limitations of using subjectively determined utility – and the presumption that its rational – as a cornerstone for a view of political economy.Report

      • Avatar clawback in reply to Stillwater
        Ignored
        says:

        Well, the only way the zero and positive sum categories work at all when discussing inequality is in a trickle-down world in which making rich people richer necessarily benefits others. If you don’t believe in trickle-down theory then inequality really is zero sum. But the converse is not true; certainly I can believe there are positive sum policies without believing redistribution upward is one of them. That’s where the right is so dishonest; a “zero sum outlook” doesn’t follow from rejection of a particular right-wing policy goal.Report

      • Avatar Roger in reply to Stillwater
        Ignored
        says:

        Clawback,
        The secret decoder ring to identifying positive sum actions in called voluntary consent. Pure and simple.

        The only way to ensure to everyone’s satisfaction that an action is positive sum, is to have those directly impacted by the interaction all agree with it.

        That is why libertarians are so hot for markets. They build up upon trillions of smaller scale voluntary win win interactions into big prosperous societies. That is also why libertarians are so damned suspicious and wary of government solutions, because they are so frequently coercive on at least one party.

        That said, I believe there are paths that we can take to take the magic of markets and apply it to non market issues. The key is to introduce choice and competition, slowly and carefully into the system. As the choices expand, so does subjective utility. Buchanan wrote about this in his classic The Calculus of Consent ( and yes, Hanley turned me on to this gem). I could go on for hours…Report

        • Avatar Kimmi in reply to Roger
          Ignored
          says:

          fuck no, it’s not. it’s called PRODUCTIVITY ENHANCEMENTS.Report

        • Avatar Kimmi in reply to Roger
          Ignored
          says:

          Voluntary consent does not make a positive sum action. I buy your bread for $.05. Two weeks later, you buy it back from me for $.05. This is not a positive sum action.Report

          • Avatar Roger in reply to Kimmi
            Ignored
            says:

            Yes it is. At each case both parties preferred the other item. Utility was expected to increase under each situation, otherwise they were wasting time.Report

            • Avatar Kimmi in reply to Roger
              Ignored
              says:

              obviously you missed the reference.
              THEY ARE JUST WASTING TIME.
              as to why people waste time? religions are funny things, ya know?Report

              • Avatar Jason Kuznicki in reply to Kimmi
                Ignored
                says:

                THEY ARE JUST WASTING TIME.

                No, they’re not. They expect to gain utility, so they act. And they could easily be correct.

                I sell you bread for .05. I loan that money to a friend, I recoup .06. I buy back the bread for .05.

                You’re no worse off — as you’ve insisted. But I’m .01 to the good. So I’ve definitely gained utility. Pareto improvement wins.Report

              • Avatar Kimmi in reply to Jason Kuznicki
                Ignored
                says:

                the only utility I can see in temporarily selling your hummitz to your neighbor (who doesn’t have enough time to get that sixth cent, as it’s one week and a day), is in generating good will. And if you do it every year, you’ll see that good will evaporate.Report

        • Avatar clawback in reply to Roger
          Ignored
          says:

          I wasn’t looking for one more tedious debate about The Magic of Markets, just pointing out the falsehood of your italicized Zero Sum Outlook. I believe that many liberal policy prescriptions have a positive sum. I could be wrong about that, but it doesn’t follow that I have a Zero Sum Outlook.Report

          • Avatar Roger in reply to clawback
            Ignored
            says:

            Clawback,

            If you operate coercively you do. If you cannot persuade the other party to go along, you are engaging in a win lose interaction (though you could have a free rider problem, but this is another diversion).Report

            • Avatar clawback in reply to Roger
              Ignored
              says:

              Wouldn’t my “outlook” depend on how I see the transaction? I may be either right or wrong about whether it’s mutually beneficial, but you don’t get to tell me what my “outlook” is.

              (And no, the free rider problem is not some parenthetical diversion, but is central to determining the proper role of markets.)Report

              • Avatar Roger in reply to clawback
                Ignored
                says:

                Clawback,

                Great question… I obviously need to clarify.

                There is nothing to keep a slave owner from asserting that it is “positive sum” to enslave another. Or a thief from asserting that the money is better in his pocket than ours. But I am defining positive sum as a synonym for win win. The reason for this is of course that utility is subjective and immeasurable. Anyone can assert that the outcome they desire for themselves or for others is superior. The problem of course is that anybody and everybody else can disagree.

                The only situations which we can be reasonably sure are positive for all parties involved are those that are agreed to without coercion or duress by all affected parties.

                I have no idea what your outlook is. Sorry for suggesting I did. I do believe that many progressives operate under a zero sum outlook. Certainly many of the comments are.Report

              • Avatar Piper190 in reply to Roger
                Ignored
                says:

                “The only situations which we can be reasonably sure are positive for all parties involved are those that are agreed to without coercion or duress by all affected parties.”

                This is essentially a tautology- “Government can never produce positive sum outcomes, because government is by definition “coercive,” therefore all government actions of any kind are by definition zero sum.”

                Did the government’s investment in DARPA, to provide just one example, produce a positive sum outcome?Report

              • Avatar Roger in reply to Piper190
                Ignored
                says:

                Piper,

                Sorry, I overlooked this excellent comment in the fray.

                Yes, to the extent government uses coercion to accomplish its goals I believe it is not a mutually agreed to win win situation. That is why libertarians will tend to try to minimize the role and scope to the essential core, and to try to introduce choice and competition wherever it can be effectively fit in.

                I do believe that government is necessary and that anarchism is unlikely to work any time within my horizons. Thus the positive sum outlook leads me to minimizing the role and coercive was of government, where as a zero sum outlook would not.Report

              • Avatar James Hanley in reply to Piper190
                Ignored
                says:

                I’m in mild disagreement with Roger here. I believe the presence of coordination and collective action problems that result in a lack of productive cooperation when people really would like it to happen provides a space where it is possible for coercion to produce a positive sum outcome. I think those cases are fairlyl rare–although the obviousness of some of them makes them seem fairly common–and those cases certainly don’t indicate that governmet coercion normally creates positive sum outcomes.Report

              • Avatar Kimmi in reply to James Hanley
                Ignored
                says:

                governments appear better at reducing negative sum games, than creating positive sum outcomes.Report

              • Avatar M.A. in reply to Roger
                Ignored
                says:

                But I am defining positive sum as a synonym for win win.

                And that is where your entire argument is based on a false premise.

                Interactions between the 99% and the 1% for the past 30+ years have not been win/win. They have been, at best, Win/Draw. The 1%’s wealth and income have grown significantly while wages for the 99% have stagnated, even as productivity kept increasing.

                The 1% have “won.” The 99% have faced a draw and a relative, ongoing decrease in buying power only masked by predatory credit offerings.Report

              • Avatar Roger in reply to M.A.
                Ignored
                says:

                MA

                To the extent that the wealthy used coercion or deception or undue privilege I agree. I also condemn the same actions from the non poor.

                Economists have weighed in on this and they do not subscribe to your view.

                http://www.igmchicago.org/igm-economic-experts-panel/poll-results?SurveyID=SV_0IAlhdDH2FoRDrm

                In general, the wealthy have benefited from technology and globalization both in what they can purchase, and in the value based upon supply and demand of their labor and capital. The less skilled are competing with a substantially expanded supply of labor. The wealthy in general did not cause the lack of income growth with the poor.

                The amazing thing here is that a number of progressives have dismissed my argument as unfair to progressives. I find it amazing they are refusing to actually read all the other progressive comments which argue that the relationship is indeed zero sum. In other words, the progressives are trying to both deny my accusation and defend it, sometimes in the same sentence.Report

      • Avatar Kimmi in reply to Stillwater
        Ignored
        says:

        except that most entrepreneurs like taxes, as they consider their competitors (the “landed rich” like the koch brothers) to be less efficient at creating new wealth by relieving middle class people of their earned income.Report

  15. Avatar b-psycho
    Ignored
    says:

    The positive sum view of the current economic structure assumes that it somehow is or was once due to spontaneous market order. It’s zero-sum because it was built to be that way.

    (not having read all 255 responses yet, so sorry if this was said already)Report

    • Avatar Jason Kuznicki in reply to b-psycho
      Ignored
      says:

      I don’t understand what your first sentence means. I would say that the positive sum view of the current economic structure is an assertion that a large part of our current stock of wealth is the result of comparative advantage and gains from trade. “Spontaneous order” doesn’t actually do much work here.

      I do not understand what your second sentence means either. The current economic system was built to be zero-sum? If so, then why aren’t we all living in caves? How is it that I walk out of the clothing shop with a shirt, and I’m happy, and the merchant is richer, and he’s happy? We’re both better off, and that wouldn’t be the case if the current economic system was built to be zero-sum.Report

  16. Avatar BlaiseP
    Ignored
    says:

    I would take issue with your characterisation of progressives as Zero Summers. Who has led you to believe we believe such things? EvoPsych is so much astrology, an ignis fatuus, an explainer of nothing.

    This we know from mankind’s transition from hunter gatherer to city-dweller and empire-builder: societies rose on the basis of specialisation. Even within the clans of the hunter-gatherer, labour was divided: the flint knapper and arrow maker’s skills fed everyone. Shall we call him an Elite? He certainly was an elite and so were the traders who brought him flint. Flint and obsidian became the basis for vast trade routes, even where cultures iron and bronze never rose.

    Civilisations rose on the basis of competent leadership. As the Sahara desertified and mankind migrated into the Nile Valley, the pharaohs arose to deal with a constant problem: the redistricting of the Nile’s fertile flood plain. The people lived in mud brick houses, often washed away in those floods. Armed with a little elementary trigonometry, the pharaoh’s surveyors would pound in the property line stakes in the same way we see every time someone buys a detached house and its property in our times. Through the leadership of the pharaoh and his priests, Egypt was often run like an enlightened collective. We see echoes of this in the story of Joseph in Genesis, the granaries of the temples filled against the risk of crop failure.

    The Progressives are not a Zero Summer. That specious label might be more properly applied to our enemies. Who now resists any efforts to make the wealthy bear their share of the burdens of the societies from which manifestly benefit, far out of proportion to their numbers? Who says such talk is Class Warfare?

    Let me gently but vigorously pluck the feathers out of this ugly turkey:

    The Progressive believes the well-off made more money than the less-well-off, not by morally suspect actions but by a combination of luck, circumstances and capitalisation. Insofar as they have benefited in the context of a working society with roads to carry their goods to market, an educated work force to do the work and the infrastructure to promote stability, their contributions to society in the form of taxes ought to reflect these facts. Think of it as paying dividends. For those who disagree with this assessment, may I interest you in a prospectus on business opportunities in the Democratic Republic of Somalia.

    The Progressive believes in the sort of progress which leads the poor out of poverty. If this means the wealthy become more wealthy, all to the good we say, insofar as a rising tide lifts all boats, supertankers and fishing canoes alike. If we notice the poor do not rise while the wealthy do, this is not Class Warfare. It is a brutal recognition of systemic inequality, one which cannot be idly dismissed.

    The most egregious falsehood is this wretched straw man of the Fixed Pie Size. No Progressive believes the pie size is fixed. There is only Simple Simon’s Pie

    Simple Simon met a pieman,
    Going to the fair;
    Says Simple Simon to the pieman,
    Let me taste your ware.

    Says the pieman to Simple Simon,
    Show me first your penny;
    Says Simple Simon to the pieman,
    Indeed I have not any.

    There’s your pie, Roger. No pennies, no pie. The last verse of that nursery rhyme is most instructive:

    Simple Simon went to look
    If plums grew on a thistle
    He pricked his fingers very much,
    Which made poor Simon whistle

    I won’t even bother attempting to dispute any of that OWS nonsense. Wall Street as it was in 2007 is now gone, its investment banks now cowering like so many refugees in the blue plastic tents of government-insured banking corporations. Yet still these fiscal idiots try to run unregulated insurance scams and never shall we see a Libertarian or Conservative demand meaningful restraints against Force and Fraud in these circumstances.

    There is no excuse for abject poverty in the world today. Markets have not solved these problems and never will. Markets will forever seek loopholes as water leaks from a rusty rain barrel. When I see a Libertarian or Conservative concede to the amorality of markets and the concomitant immorality of those who run them, there will be two moons in the sky.Report

    • Avatar Stillwater in reply to BlaiseP
      Ignored
      says:

      You bring up one of the sticky points in an otherwise excellent thread. It seems to me that Roger believes progressives are defined by an advocacy for a ubiquitous state, hence ubiquitous state coercion, hence zero sum thinking. As many people have pointed out, tho, being an advocate for state intervention in one area doesn’t mean we advocate state intervention in all areas. In fact, I think we liberals (progressives) are zero-summers in only those cases where cultural forces and human nature can’t or won’t support positive sum arrangements (equality of opportunity, the difference principle, stuff like that), and we disagree with libertarians about what those are.Report

      • Avatar BlaiseP in reply to Stillwater
        Ignored
        says:

        I really don’t care what anyone believes, the older I get. Just show me what they do, I’ll reach my own conclusions. If Liberals observe the rising tide does not float all boats, I won’t be told it’s Class Warfare to say such things. A serving of Simple Simon’s Pie for such as these.Report

      • Avatar Roger in reply to Stillwater
        Ignored
        says:

        Stillwater,

        Yeah, we just have a difference of opinion of where government should start and end. That is not true of all your brethren though.Report

    • Avatar Roger in reply to BlaiseP
      Ignored
      says:

      Blaise,

      I guess your point of view is pretty much summed up with your favorable view of the enlightened leadership of the pharaoh. That sums up what I mean when I say the progressive world view. You believe in the value of the Big Kahuna, especially with yourself as the emperor or at his side.

      Who cares that the Pharaoh assumed his role and the bloody point of his spear? Who cares that the people toiled away in the desert sun scraping by for the equivalent of a dollar or two a day after the Pharaoh and his henchmen took their share? Who cared that the masses were enslaved building up the Pharoahs treasury and monuments and burial tombs?

      Yes, this is exactly what I mean by a zero sum view. The fact that you see it as an enlightened collective says everything. Four thousand years later, life still sucked for the Egyptians, but at least we have plenty of tombs to show for it. World class tombs. The progressive dream. Yeah, I see the benefit of full granaries, we gotta feed the slaves. They are almost as valuable as the livestock.

      The positive sum world view is one which forbids “enlightened” enslavement, violence and fraud, and which encourages people to get rich only by enriching others via voluntary, uncoerced, mutually beneficial interactions.

      You say progressives believe the wealthy are not suspect. Perhaps you should read the comments section of this OP. See how many times you can find self described progressives accuse the wealthy of raping, stealing and exploiting the masses with no proof other than their warped zero sum world views and absolute ignorance of economics.

      No Blaise. You need to get out of your cloud and actually read some history. People have been starved, enslaved, ensurfed, exploited by you and your type for ten thousand years in ten thousand societies. The result was always the same. An illiterate, unhealthy, poor and short lived existence kissing the Pharoah’s ass. Only in the past few centuries have we started to throw off the shackles of your kind. Finally we saw the possibility of property “rights”, and the value of liberty and free markets. Now people live twice as long and are ten to a hundred times more prosperous.

      I prefer voluntary, uncoercive positive sum methods over your enlightened collective at the end of your gory spear.Report

      • Avatar BlaiseP in reply to Roger
        Ignored
        says:

        The point of this chain of essays is Inequality. I have a low tolerance for anyone who would tell us tales of the Halcyon Days of Yore, when Man was Free, before Oppressive Gummint was gumming up the works. The archaeology contradicts all such fatuous Rousseau-ian conclusions. There was a great deal of raping and stealing and exploitin’ those huddled masses yearning to be free, all through history. I have read a good deal of history, anthropology and linguistics also. More to the point, hunter-gatherers came past our back door, out of the Sahara Desert. The Tuareg still keep slaves, the Buzu.

        Every morning, we are told, the Egyptian doctors would examine the feces in the pharaoh’s bed pan and issue a report to the court on the state of affairs in the Royal Colon. For the pharaoh was the country, just as Hobbes told us in Leviathan, a book I’d urge to to read or re-read.

        The Chinese emperors believed themselves subject to the Tian Xia, the Mandate of Heaven, which drifted around like the centre of gravity in a wobbly stack of plates. If things went badly in the land, the Emperor felt obliged to do something about it, refocus the country, do justice and preserve the people from calamity. If he did not, the Tian Xia would depart from him and he would be swept from power.

        Furthermore, do not insult our intelligence with the continued recitation of these Libertarian mantras about voluntary, uncoerced, mutually beneficial interactions. Most of mankind’s interaction with his fellow men is of coercive necessity according to Maslow’s Hierarchy. Only the well-fed can indulge in fantasies about Noble Savages. Savages are not especially noble people, nor are they free. If man is to be free and live a long life in a world where justice means anything, where any possibility of equality exists, he will first build upon a foundation of law and not ridiculous and unscientific Noble Savage bullshit.Report

        • Avatar James Hanley in reply to BlaiseP
          Ignored
          says:

          If there’s a League Award for Excellence in Intentional Misreading, I’d like to nominate this comment.Report

          • Avatar BlaiseP in reply to James Hanley
            Ignored
            says:

            Boniface VIII was probably the first pope to claim the infallibility of the Church. His predecessor was a strange old Pope who went insane, name of Celestine V. At last, after being chased around for a while, Celestine was confined to a room in the castle of Fumone by Boniface VIII, whom Dante would place in the Eighth Circle of Hell. So tightly was Celestine confined, the record says:

            “quod, ubi tenebat pedes ille sanctus, dum missam diceret, ibi tenebat caput, quando quiescebat”

            “that the spot whereon the saint stood when saying Mass was the same as that whereon his head lay when he reclined”

            That’s sorta how I feel, James. Here’s what I read:

            To the extent some children are screwed out of the opportunity for economic advancement because of a lousy education, it’s primarily government that’s screwing them. If our current system was in fact the result of the market is there any doubt that critics would be pointing the finger of blame in that direction? And yet there are vigorous objections to pointing the finger of blame at government for bad schools. That is, the institution that organizes the system would be blamed if it were the market, and demands would be made to supplant that organizing institution with another one, but when the organizing institution is the government it is not the institution that gets blamed, and there is no call to replace it with a different organizing institution–instead, blame is directed at specific policies and specific actors in the political system without ever realizing that such policies and such actors are very much the typical consequence of a government-based aproach [sic].

            None of that is true. It’s all begged questions. Public schools are agents of equality in a world full of inequality. Where I say Mass is where I lay my head, James. I read English, other languages, too. I will not be told what’s Intentional Misreading from some doctrinaire who would tell of Voluntary Uncoercive Positive Sum Methods and of Gory Spears. Who’s misreading whom, here?Report

            • Avatar Roger in reply to BlaiseP
              Ignored
              says:

              Blaise,

              Your true colors are clear. Your role model is The Emperor, The Pharaoh and the Leviathon. Heck, I’ll bet you rooted for Darth Vader.

              You are in love with top down coercive central planning run by fellow progressives just like yourself. I’m actually just surprised to hear you finally admit it. “the enlightened collective” should be the title to your piece on inequality.Report

              • Avatar BlaiseP in reply