Do rich people deserve their money?

[lancemurdoch]

I've seen discussions here on the fairness and unfairness of taxes and other things. Here are my opinions.

Prior to and during the bubble I wasn't that interested in the mechanics of the economy and things affected by it, or at least hadn't studied it. I was interested in making as much money for myself individually per hour as possible, and also read a lot about fundamental equities analysis, the type that people like Warren Buffett and Peter Lynch do so well. But not in the general sense, I was not studying economics, or "political economy" as it used to be called in the old days. Anyhow, after the stock crash, which I had expected, and during the 3+ years of recession and "jobless recovery" which followed it, which I hadn't expected in terms of length, I became interested in economics and politics. So this is what my opinion is now. It's probably different than what a normal person would have, but I've thought about it, and the craziness of the bubble and long jobless recovery tempered it.

Early classical economists like Adam Smith and especially David Ricardo said that all wealth is created by workers. Some people say that economics, or political economy as it was called then, was looked at somewhat objectively and scientifically until the early 19th century when people started having their interests color what they thought. Anyhow, I feel alternative theories of wear wealth come from are pretty weak, and I think so does everybody, the right usually concentrates on other arguments. If workers create all wealth, this leaves the question on what does an heir who inherited a lot of money live off of? Their money is usually losing value due to inflation, and if they spend out of their fortune only they will run out of money. A lot of people like to think that heirs lose their money fairly easy, but I'm afraid that this is an urban legend, one that some people have a motivation to spread, and one that gives comfort to some people. United For a Fair Economy did a study of Forbes 400 richest Americans and found that 43.35% inherited their way directly onto the list. And that doesn't count the people who inherited up to $300 million and parlayed themselves onto the list with that, just the ones who inherited over $300 million and were born on the list.

So anyhow, if these people aren't working, and their fortunes will run out if they just spend from them while they lose value to inflation, where do they get money from? Well, Keynes called these people "rentiers". The main way they get money is through rent, interest and/or dividends. In fact if you look at the Federal Reserve's breakdown of asset ownership by wealth level, the wealthiest 0.5% of Americans own 46.5 of all outstanding bonds, while the poorest 90% of Americans have to share 9.7% of all outstanding bonds ( http://www.federalreserve.gov/pubs/oss/oss2/papers/wgt95.pdf ). One interesting thought of this is that the 9-10% of the money paid in taxes goes to national debt interest - so when you pay taxes, virtually a nickel of every dollar goes to the wealthiest 0.5% of Americans!

So the money these people get, the money they live off, are from workers creating wealth, as Ricardo said. A worker goes in a factory, and bangs $20 worth of wood, nails and whatever else into $50 tables all day. Where did that $30 of worth come from? The workers labor.

I'll bypass all the statistics of how the wealthy (rentiers) are getting wealthier than workers, although the bond one is a good indication. We know things are good for them, how about workers? Well, over the past 35 years, the average inflation adjusted hourly wage has actually fallen! Americans make less per hour than they did 35 years ago. You can see that on the government's Bureau of Labor Standards page, http://www.bls.gov, I can post instructions if anyone wants them to get directly to that statistic. Hours worked per year has risen by a 3 digit number over the past 35 years for Americans. And savings account have shrunk while debt has increased, while housing costs have skyrocketed past inflation, making it so that most people don't outright own their homes, but have big mortgages where they'll pay the expensive price of their home many times over, and that's for people who can afford a home. All that mortgage interest, or rent payments, goes to rentiers of course, but I'm talking about how it's affecting workers right now. But all of this isn't good. Especially in a jobless recovery where unemployment hit a 10 year high two months ago.

So that's how I see things, or at least what statistics I see as reflecting the economic situation. Now what can be done about it in general? Well, I see the main problem as that workplace struggle, the owners pressuring the bosses to pressure you to give up more time of yours where you are not keeping the wealth you create, but giving that surplus unpaid time to the owner. There are different forms of this pressure - making you work longer sans overtime, paying you less, making you work faster so the percentage of time where you're not paid will increase. Since this happens in the workplace, I think the workplace is the main place where the issue should be hashed out. And I think the best way to fix this problem, the problem of the workers in this country having gotten poorer over the past generation, is through organized labor. I don't think heirs who've never worked a day in thei lives deserve to take an increasing percentage of the wealth created by workers over the past 35 years. And I think the best place to stop this, to keep more of the wealth we create, in other words, increase wages and decrease dividends, is in the workplace, and the best method to do this collectively is by organizing.

Progressive taxes seem a wishy-washy way of doing this. The rentier takes from us (the wealth we create at work), then the government takes it from them and redistributes it back to us. Why not just organize and prevent them from expropriating all of that at the workplace to begin with? That's where I stand. I think the Democrats, and political parties that (are supposed to) represent workers main duty is to keep the government off the back of workers trying to organize. That's why I like Gephardt. I don't think it's government's job to do this for us. I think tactical efforts in this area should be made. But I think the main strategic push should be wear the original theft occurs, in the workplace.

[TAH6988]

1. Depends on what you mean by Rich

And on how they make their money.

[JanMichael]

2. Sheesh, it's Friday morning dammit.

Having a hard enough time filing some really easy reports!

That said I read your post and have to agree with many parts of it.

No time to really comment though so I'll just post this to keep it kicked up.

[bryant69]

3. All this long windedness does fall on a particular rock

Whether or not everybody is rich in America. Everybody thinks they could get rich down the road, and everybody wants to get rich. So putting in place mechanisms to ensure the rich don't get what they want won't ever be that popular.

Bryant
Check it out --> http://politicalcomment.blogspot.com

[Brucey]

4. Wow, that's a lot to comment on.

I like most of what you write. Unions are the most democratic institutions in the world, corporations the most dictatorial. Yet, I am always amused that American sheeple love and support corporations, but seem to hate unions. I think Saddam should have incorporated Iraq, named himself CEO, and then maybe we wouldn't have invaded them (who ever proposed invading Unocal?). Money represents resources. Why should 1% of the people have 99% of the resources? Even underpaid workers in America are richer than 80% of the people on earth. I like your ideas, but have no faith in reaching those ends. How can we get the American voter to understand the plight of the under-appreciated laborer? I understand that 1 out of 5 people have been laid off since Bush* took office (emphasis on "took"). I know many of these people and they still support Bush*. What can we do about it?

[lancemurdoch]

11. Americans and unions

I think there's good reason for people to mistrust unions. There are good unions and bad unions, just like there are good political parties (Democrats) and bad ones (Republicans). I'm not just for unions but rank-and-file run unions, and militant unions. Militant meaning they don't lie over and play dead, once they win a concession, they go on and fight for the next concession. This is how the Republicans play - Paul Krugman talked about this recently - once they win something they don't celebrate, they say, "OK let's go win our next victory now".

I think if you look at American union history, and compare it to say Europe, in many ways European union history has more to be proud of. I think the rank-and-file workers in the US have as much to be proud of as European workers, but the unions in the US have usually been worse, many of them have been "business unions", in other words, almost like companies, but instead of selling commodities, the labor bosses, who are akin to company bosses, are selling labor power. The bosses get lots of perks, and the decision making ability is taken out of the hands of the rank and file and handed over to bureaucrats. In a situation like this, where it becomes just another business almost, is it any surprise corruption seeps in, even organized crime? I asked some person I know who knows more about organized crime then I do, he said "if there's money, they are interested in it". If a union becomes a business like any other, it's no surprise such corruption happens. In Sicily the mafia kills union members at the behest of corrupt bosses. In the USA, they often run the local - and often even hold sway over the leadership of the international. Of course, every local is different, and every union is different, some right now are very close to the rank and file, have a proud old tradition and have very little if any corruption. But some are not like that.

Anyhow, I think despite all of that the campaign against unions is overplayed. In fact I think it's a lot nastier than people realize - I'd be curious how many union members in the US have been killed since 1946 actually during an incident. I know of two - I saw that someone was shot dead by a gun thug in the documentary "Harlan County, USA" which was during a coal strike in Kentucky in the 1970's. I also know a scab ran over and killed a Verizon worker a few years ago in upstate New York. I just found out about these things randomly though, I wonder how many more cases there are like this. Anyhow, it's not always that deadly, but the campaign against unions in the USA is very nasty, and also secretive, or at least, you don't read about it in the mainstream press.

[JHB]

45. Not always deadly...

...but companies do employ professional union busters.

Confessions of a Union Buster
by Martin Jay Levitt, Terry Conrow (Contributor)

From Publishers Weekly
With compelling vigor and rich detail, Levitt, writing with freelancer Conrow, tells the tale of his rise to union-busting fame from 1969-1988 and his equally dramatic change of heart. Now a consultant advising unions on how to bust the union busters, Levitt says that he is baring his sins both for personal reasons and so that former colleagues will have nothing further with which to discredit him. He portrays himself and his fellow union busters as cynical and contemptuous of workers who try to organize. Using manipulation and propaganda, the busters wear down the union organizers. Levitt's union busters are repulsively slick, preying on the fears and purses of the companies that hire them. The details of Levitt's descent into alcoholism seem prosaic compared to the descriptions of the many union avoidance campaigns he masterminded, even if it was 12-step remorse and humility that provided the motivation for this confessional. His bold story is timely, given current national efforts to reform labor laws.
Copyright 1993 Reed Business Information, Inc.

http://www.amazon.com/exec/obidos/tg/detail/-/0517583305/qid=1065195473/sr=8-1/ref=sr_8_1/102-3673405-0598528?v=glance&s=books&n=507846

[Kamika]

5. some do some dont

I mean if they work hard for it sure they do.

If they just sit and do nothing like politicians.. no they do NOT deserve it.

my parents came to usa from korea with absolutely nothing, and now own a restaurant.

I think you can call my family rich, but its after ALOT of hard work and sacrifices, i havent had one day off (not even saturday or sunday) since july. Im a 21 year old woman and i will most likely not go to college. And my lovelife is non existant


Edit: ill be very happy to let my children inherit the money i worked hard for.

[Caution]

6. read the communist manifesto

That's basically what you are talking about. (I'm talking about the actual basis of this theory rather than the popular perception of it). While I agree to a great extent I will say the following:

I personally grew up in public housing, worked extremely hard to educate myself and to get an education, I worked from the age of 14 until now without any real break. I started at $4.25/hour and now, 16 years later am making north of $50k. I am a white male (which I mention only to ake it clear that I understand that a significant opportunity barrier isnt there for me). I have managed to save a fair amount of money and make some decent investments with it and am on the verge of purchasing my first home. I have already assisted my parents in the purchase of their first home (the single proudest moment of my life), I have also helped to finance the education of my brother and sister (my sister just graduated from Harvard University this past june, the second proudest moment of my life). I have made massive personal sacrifices in my lifetime which I won't detail here as some are intensely personal, but I can say from personal experience that it is possible to go from being dirt poor to being in the upper 5% of income earners in this country. I am now at a point where I feel that I can scale back on this part of my life and begin to do some serious political and charitable work (I am a donor to various causes already).

The issues you raise are entirely valid and perfectly reasonable, I would never claim that a person's misfortune should be put entirely at their own feet, instead I would suggest that the very things the right-wing portrays about "people being poor because they are lazy" is a truly insidious thing. It's not that people are lazy it's that the situations you outline above are designed to destroy their will, motivation and desire to achieve this type of wealth. Those who have money and power wish to protect it, and use propanganda very effectively to prevent people from realizing that as a group they have much greater power than the "select" few could ever hope to have.

The real problem here is that those in power have used that power to destroy organized labor.

From reading your diatribe here, you should really go out and pick up Propaganda and the Public Mind by Noam Chomsky (you sound like you would really LOVE some of his work).

[lancemurdoch]

14. laziness

The funny thing about the laziness thing is that people like Paris Hilton never work a day in their lives. And they don't live off of "their own" money - they live off of the wealth created by thousands of maids, front desk clerks, bellboys and so forth every year. Yet the corporate media trys to portray the workers as the lazy ones, who are in their position because they are lazy (e.g. working), while the one who has never worked, and lives off the wealth others create is not tagged with that.

As far as Chomsky - yes I've read him. Actually, I was reading Chomsky back when the bubble was forming and expanding (1994 -> 2000), which was when I was working 24/7 to increase my skill level as well as studying fundamental stock analysis to make the money I made in the market. I had little interest in politics or economics aside from what he wrote, and most of what I liked was his anti-authoritarian attitude I suppose, as well as the ability to give a common sense, plain English point of view that was very interesting and that I didn't see anywhere else. I still think he's good - in fact, he's probably the one who made me think unions are a better method than government (although both should be tried, I just think unions are a better method).

[Caution]

18. Yeh the whole concept of worker "laziness"

is so absurd. Working construction (which i did for a 2 year period) is some of the hardest work there is (I also found it to be the most rewarding professionally, i loved the sense of accomplishment) yet these people are vilified for union agitation.

Recently in massachusetts there was some labor problems between Verizon and their workers and Verizon put out a truly obnoxious and obvious propaganda piece that described just how "well" they treated their workers. As a close friend of a labor leader employed by this company I was very offended by the obvious lies and techniques used in the ad.

I'm a big Chomsky fan though i do think he has a tendency to make assumptions and present them as fact. He himself is a clear master of propaganda and uses language very well to advance his theses.

It's funny that you mention the Hiltons! I was going to mention them in my response in this thread on the subject of inheritance as an exmple of truly sickening people. The media fascination with them is really rotten.

[lancemurdoch]

27. verizon cwa/ibew

Yes, well, since I think unions are a good thing, I have been working on union solidarity campaigns, such as Jobs with Justice's connection with Verizon, so I know a bit about it.

One of the funny things about those commercials is they talk about how great the health benefits are at Verizon, so that people would think Verizon workers are just pampered or whatever. What they said was true - except Verizon was trying to cut those benefits! So the commercials basically said "Don't worry about Verizon workers - they get great health benefits and are treated well". Except the thing the company was priding itself on was what they were cutting.

Another thing about Verizon is it was a government-granted monopoly for many years, and while legally not a monopoly nowadays, is still in reality a defacto monopoly. Which is why they have even less baring on all of this - these are not innovative managers and bosses or whatever, these are people sitting on a government-granted cash cow.

[Gringo]

7. Simple answer: no.

Most wealthy people ARE that way hereditarily. Some rise from the middle class. Very few of the poor ever do, which is why their stories stand out so much.

[Caution]

9. While those who inherit

don't necessarily "deserve" to be wealthy, it doesn't necessarily follow that their wealth should arbitrarily be re-dsitributed. Many people who achieve wealth do so primarily to provide their children with a comfortable life. That said, I certainly have no porblem with inheritance taxes and I certainly feel that those who are born wealthy have a moral obligation to use that wealth to make the lives of the public in general better.

[pansypoo53219]

28. at a certain point

do not some of the wealthy by inheritance have enough? the warren buffets, of the world, do they not have TOO MUCH. I am all for endowments, but there is no crime in paying for the priviledge of living here and having the opportunity HERE to create that wealth. and No one can take it with them.

[Caution]

51. as an aside

Warren Buffet is one of the good guys out there. While i don't always agree with him, this guy is a major philanthropist. One self-made multi-millionaire I know simply continues making money because he doesn't want to retire. This man donates MASSIVE amounts of money to the best causes out there (AIDS Action, the DNC, Planned Parenthood, NOW, etc etc). He has also made provisions in his will that leaves 95% of his personal wealth to charity and the rest to his two children. One of the problems with a government sponsored re-distribution of wealth (the only way possible outside of personal charity) is that the decision of where that wealth winds up is in the hands of those in power. Personally, I trust my friend to give the money he accumulated to the proper causes a lot more than I trust how Bush or Clinton or Gore or Reagan, etc to distribute it.

There are no easy answers to the question of how a wealthy person should behave with his/her money. We do after all live in a free society (unless you ask John Ashcroft).

The best answer to these problems is undoubtedly an informed and organized and motivated labor movement. However, this is always fought tooth and nail by the wealthy who fear a communist revolution type wealth redistribution plan.

[TAH6988]

10. Any stats to back that up?

And what is wealthy to you?

[lancemurdoch]

19. stats

Well, I think my statistics about the Forbes 400 richest Americans help in that respect. You can just go down the list and see the names - Walton, Walton, Walton, Walton, Cox, Cox, Mars, Mars etc.

Of course, some of the money over time spreads to many people over generations. John Rockefeller made his money a while ago, and the third generation of his, like Nelson Rockefeller...he died in the 1970's. So that money has spread through four or five generations. But they still have people on the list - #71, #140 and #195.

Doug Henwood's "Wall Street" has a section discussing wealth inheritance versus earned and the statistics.

[TAH6988]

25. More than the top 400 people on

that list are "wealthy." And of that 400, how many actually inherited?

[lancemurdoch]

34. It's in my original post

I stated how many inherited their way onto the Forbes 400 richest list in my original post here - "United For a Fair Economy did a study of Forbes 400 richest Americans and found that 43.35% inherited their way directly onto the list. And that doesn't count the people who inherited up to $300 million and parlayed themselves onto the list with that, just the ones who inherited over $300 million and were born on the list."

Doug Henwood's "Wall Street" speaks about this somewhat. In it, he says that economists Lawrence Summers and Laurence Kotlikoff estimated that as much as 80% of personal wealth comes from direct inheritance or the income on inherited wealth. Laurence Summers incidentally made the famous quote that "the economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable and we should face up to that", so he's not exactly a raving socialist. That appears in "The role of Intergenerational Transfers in Aggregate Capital Accumulation", Journal of Political Economy 89, pp. 706-732 (1981). Henwood lists some other studies as well, what percentage they get seems to depend on whether or not they count income on inherited wealth or not.

[IrateCitizen]

37. Kevin Phillips talks about the same thing in "Wealth and Democracy"

I think that, during the industrial revolution, only something like 10% of the top 1% (or something like that) actually WORKED their way up to that point. At least 90% were BORN into that wealth, in one degree or another. Like you pointed out, while someone inheriting $100 million may not be on the Forbes 400 initially, it's pretty difficult to call someone with such a headstart a "self-made man".

Also, anyone who cites Doug Henwood as a source is A-OK in my book. I used to love listening to his show "Left Business Observer" on WBAI -- but now that I'm on the train while it's on, I never catch it.

[no name no slogan]

55. Do you know about Henwood's LBO website?

http://www.panix.com/~dhenwood/LBO_home.html

He's also got the newsletter of the same name in print, too.

I've been a fan of his since the early 1990s when I worked in the financial services/investment industry. His writing rang true to me, when I saw a number of "regular folk" buying into the stock market, thinking it was like a bank account, only better. I'd mention something I'd read by him and wait for the glares to come from the managers and supervisors. I didn't care if I got canned, because it was a shitty job, and it was the "go-go" 90s.

If you truly want to see "successful" self-made people, institute a 100% inheritance tax. Then you'll REALLY get to see some real-life "bootstrappers". :)

[TAH6988]

39. So in other words

"Most" wealthy people do not inherit their wealth. Thanks!

[IrateCitizen]

44. Are you blind, or do you just have a comprehension problem?

Doug Henwood's "Wall Street" speaks about this somewhat. In it, he says that economists Lawrence Summers and Laurence Kotlikoff estimated that as much as 80% of personal wealth comes from direct inheritance or the income on inherited wealth.

This was one of the statements in the original post. Also, the original poster stated that over 43% inherited their way DIRECTLY onto the list -- that is, they just showed up and were there. This DOES NOT take into account those who inherited significant fortunes but were not rich enough initially to find themselves instantly on the list.

When looking at the Forbes 400, at most you will find 10% of the people on it as having worked their way there from modest beginnings. I would estimate it as lower than that.

[TAH6988]

53. No your comprehension is lacking or else

you just pretend to be stupid (you do that well, BTW)

80% of "personal wealth" has no bearing on the NUMBER of wealthy people who got that way via inheriting or "making it on their own." A relatively small number of people can account for a huge portion of wealth. One again, it depends on your definition of "wealthy," does it not?

The Forbes 400 are NOT the only wealthy people in this country. And if you agree with the assertion that most "wealthy" people inherit their money, PROVE it. Maybe that fact is true, but I'm not convinced. I consider myself "wealthy," and I inherited squat.

[IrateCitizen]

57. I guess I should have defined "fiscal wealth" up front...

What I view as "fiscally wealthy" is someone who, as a poster further down pointed out, is able to live off "the income of their income".

For example, someone who owns vast amounts of real estate, takes the profits from said real estate and invests it, and lives off of THAT income -- thus being able to live comfortably AND expand his/her own fortune without performing any real work.

Of course, this kind or "wealthy" is probably well over the lowest range of deca-millionaire. I would hardly call anyone who has to spend a great deal of their lives working "wealthy" -- even if their net worth falls in the millions of dollars.

Please read through some of my posts below, you'll see that I am not against those who have been able to accumulate fiscal wealth through their own smarts and hard work. What I AM against is those who look at wealth as an entitlement for having done nothing more than win the birth canal lottery. I am against those who see the accumulation of fiscal wealth as a priority over the greater health of the society in which they live. I am against those who consistently reinforce the false reality that money = happiness, influencing masses of people to acquiesce to their own wage slavery and the ravaging of the planet in order to pursue the fool's errand of consumerism.

IOW, if you are a member of the first group, and I will assume that you are, you have nothing to fear from me. The object of my ire is those who reinforce the decay of society out of selfish greed.

[TAH6988]

58. I am a member

of that first group, but even a member of the second should have no reason to "fear" you, should they?

Now, I do agree with your belief that "most" people in that second group DO inherit their wealth as you are speaking of the "uberwealthy."

[IrateCitizen]

60. Not so long as they use that wealth to benefit society

Someone on this thread brought up the example of Paris Hilton. I would view her as an excellent example of everything that is WRONG with the idea of inherited wealth, for she sees her celebrity through that wealth as an entitlement, and gives absolutely NOTHING to the enrichment of society.

Note that when I talk of "enrichment of society", I am not talking about fiscal matters. I am talking of basic things like spending time with family, socializing with members of our communities, taking part in arts, etc. -- IOW, living.

So, does someone like that have something to fear from me, personally? No. What I would like to move to is a society in which that kind of behavior, rather than being reason for celebrity, would cause one to be an outcast.

[TAH6988]

61. I agree with you on 90% of what you are sayiug BUT

Paris Hilton in a bikini enriches me! (jkg)

[lancemurdoch]

56. no...

Actually, according to the United for a Fair Economy's study of the list, a majority of the people on the Forbes 400 richest list inherited over $50 million.

[JHB]

8. Carrot and stick

Progressive taxes amplify the law of diminishing returns on accumulating large fortunes, which gives them an added incentive toward making those negotiations with organized laobor in the first place. Otherwise it becomes too easy to do precisely what has been done: pocketing the extra money and using fear of job loss to keep the workers in line.

[Fabio]

12. I think if you

remove the capacity for americans to get rich (ie pursue the ever fading american dream) you get rid of a powerful incentive for people to make intelligent business choices which IMHO are the driver for america's international competitiveness.

Killing the goose that lays the golden egg.

[JHB]

31. Progressive taxes do NOT "remove the capacity to get rich"...

...but they do put a damper on ruthless avarice. The certainly favor long-term building of organizations over quickie get-rich-quick schemes.

They also have the small advantage of having been tired, and proven to work.

[lancemurdoch]

43. well....

Well, to start with you talk about "the driver for america's international competitiveness...killing the goose that lays the golden egg." I talked about American workers inflation-adjusted hourly wages being below what they were 35 years ago, so I would ask WHAT golden egg. Of course there is a golden egg for "America" - but it hasn't gone to the workers, it's gone to the wealthy.

As far as America's international competiveness, well from the late 1960's to mid 1990's productivity growth has been moribund. A French worker given the same capital is more productive than the average American worker - and the French have stonger unions and a more progressive government than the US does. In fact several European countries are more productive in this manner, and with the EU common currency in place and a growing EU, we now have a competitor as far as the EU goes that is as large as the US economically. You can say that Europe has a high unemployment rate, but with their generous social welfare benefits compared to ours, and with our unemployment U-6 rate over 10%, I'd say there is little difference regarding that at an economic base...except for Germany which is still incorporating East Germany. The more important question I think is GDP and productivity growth, and many European countries have more productive workers than the US does already.

[scisyhp]

13. You see problems, but not their roots.

Solutions aren't possible without understanding the causes. It's
time for you to graduate from Smith and Ricardo to Marx, who
discussed those issues quite extensively 150 years ago. As long
as means of production are privately owned the owners will keep
extracting surplus value from the workers and keep increasing
the exploitation rate. Unionist and reformist solution to this
problem, as advocated by Bernstein, was only effective in the
presence of a viable alternative to capitalist mode of production,
examplified by the USSR and the Socialist Block. Without this
alternative no amount of militant unionism will force the rentiers
to share their wealth. That's only threat to their very existance
that could put them into a more generous mood.

[bryant69]

21. Hmmmmm

I don't know, I've looked at hte Soviet Union and Cuba and China, and I think I like the good old capitalist USA better. For one thing, there's better music. And hamburgers.

[IrateCitizen]

32. If you look at Marx's transcripts, I doubt he would have liked the USSR

See my post #30 below. Marx's main thrust was not the "redistribution of wealth", but rather the "enrichment of life" by working less through gains in productivity. It was NEVER about "gaining a bigger piece of the pie". The reason that it became a class issue is that those who held all the capital had a vested interest in maintaining the system as it was, rather than recognizing that increased productivity gave an opportunity for shorter working hours, more family time, more time for the arts, greater involvement (and respect) for nature, and so on. To promote the enrichment of society would have meant for them to abandon a consumer-based economy.

The whole system was based on selfishness. Not self-interest (because a rich society that makes most of its citizens happy is in EVERYONE's self-interest), but selfishness.

[scisyhp]

33. That, of course, is a matter of taste.

Having lived in both USSR and USA, my own preference is resolutely
for the former. But that's just me. As to the problem of parasitic
bloodsucking rentiers, who contribute nothing to the society and
consume a lot, posed by the original post, that problem was
effectively solved in the USSR. There was no rentiers there,
or the rich for that matter. Everyone had to work for living.
You wouldn't believe how liberating that can be to abandon the
idiot's dream of not having to work for a living, that defining
element of the American psyche. That reminds me, gotta buy my lottery
tickets.

[bryant69]

36. Well

ANybody who would prefer the Soviet Union to the United States is on such a moral low ground that it's hard to care what you say.

The Soviet Union was a brutal dehumanizing system that slaughtered thousands of its own citizens. And I'm not saying that because I've been duped by Republicans, I'm saying it because it's true. Whatever sins America has committed, and they have been manifold, it still stands head and shoulders over every communist country.

[IrateCitizen]

41. Judging by Adam Smith's definition, I'm not certain you're correct...

"The health of any country can be assessed by how it treats the lowest elements within it." Or something along those lines.

And while I'm not discounting what the USSR did under Lenin and Stalin, or ignoring the human rights abuses that happened throughout its existence, it's pretty easy to see that your viewpoint may be a little biased. For example, when receiving an "official" American view of history, many of the US's transgressions are ignored while every transgression of a "communist" country is highlighted.

In the end, you're talking not about the behavior of economic systems, but the behavior of nations -- and nations are primarily immoral entities because they are almost invariably run by those who most strongly seek out to control the levers of power. These same people are, quite often, the ones least equipped to deal with it.

This is something that goes much deeper than political systems or economic systems -- it's about the creation of a SOCIETY, and the values that underpin it. Ours is underpinned with selfishness and greed -- a self-defeating value system that unfortunately, most have bought into at the expense of their true self-interest. What Marx espoused was a society that embraced a different value system, which was the enrichment of life for everyone. The overthrow of the "ruling class" was only a necessity toward achieving this aim, not its primary premise. And when I say "ruling class", I am not referring to all the rich. I am referring to those who seek out the levers of power and look only to accumulate personal monetary wealth and not contribute anything significant to the enrichment of society.

[scisyhp]

42. Well, that's just your opinion, which is based more

on propaganda lies than any real knowledge. It always amused me
how people who know nothing about Soviet Union would keep foaming
at the mouth at how horrible that country was and how I, who
actually lived there for 25 years don't know what I am talking
about. Whatever sins USSR committed during its history, in my
experience, it was a vastly superior country to USA, exactly in
terms of humanism, human relations and dignity. Once again, that's
just my opinion, but it's an honest one.

[RichM]

48. Your entire viewpoint is nothing more than the result of US propaganda.

You are talking precisely as Americans are raised to talk; there's nothing more to it than that. Americans immediately start foaming at the mouth & spitting out words like "slaughtering" when the word 'USSR' arises -- this is a sure sign of indoctrination.

There was plenty wrong with Stalinism, but the intemperate way you present the case is itself a demonstration of American ignorance. Your last sentence ("Whatever sins America has committed..") is amusing, because you actually have put far out of your mind what America's real sins are. No communist country, whatever their sins, ever did anything remotely as criminal or deranged as Vietnam, slavery, extermination of Indians, & all the many underminings & overthrows of foreign governments that the US has indulged in.

[Arkady]

72. Parasitic Rentiers?

As to the problem of parasitic
bloodsucking rentiers, who contribute nothing to the society and
consume a lot, posed by the original post, that problem was
effectively solved in the USSR.

Sure, the problem was "solved" with bullets and nooses. Not something we want to emulate in this country.

[scisyhp]

73. There would be no need for "bullets and nooses"

if the parasitic rentiers gave up their unearned wealth and
accepted their new, more productive, status peacefully.
There is no reason to suspect that their American collegues
are any less attached to the lifestyle of leisure and privielege.
If they were, the real wages of American workers would not be
falling constantly. At some point they too will have to face
that "sharing some wealth vs. bullets and nooses" dilemma. If
they choose the "bullets and nooses" option they will have nobody
but themselves to blame for the outcome.

[lancemurdoch]

49. a "viable alternative"

I agree with you that, especially in Europe, the presence of the Soviet Union made the wealthy people in Western Europe more conciliatory towards their workforce. Most Americans don't know much about Europe, so they'd probably be surprised to know that the communist party was getting over one third of the vote in Italy as late as 1976 ( http://www.parties-and-elections.de/italy3.html ), a year in which the center-right party got only 5% more of the vote than the Italian Communist Party (PCI) did. In the face of the Red Army in the east and at least one third of the population ready to throw up barricades and hoist the red flag at a moment's notice, the wealthy were obviously more in the mood to make concessions than they would have been without such pressures.

Of course, the Warsaw pact countries had their own problems regarding this. Perhaps the largest being the flight of skilled workers, causing Ulbricht to eventually build the Berlin wall. In my mind, the flight of skilled workers, resulting in the Berlin wall and everything surrounding all of that is probably the biggest problem the socialists had. Interestingly enough, I think we see a similar thing happening nowadays, with skilled Indian and Chinese workers coming to the US to work.

[jmcgowanjm]

15. Why not just organize and prevent them from expropriating

all of that at the workplace to begin with?

Everything in our foreign policy is designed to keep just
such a scenario from happening.

Of course there is always an exception
to Everything. But the exception
proves the rule.

Never before have the rich been richer.
Never before have there been so many
living on so little. And the Rich make $
on every child born,trying to survive.

The current scenario is made possible by
Oil. An OilUse/PopulationGrowth chart
is Identical.
OilUse is still growing. It is expected to peak
any month now. And then decline, starting 2006-2015.
See King Hubble-World Oil Production.
There is no substitute for Oil.

[DuctapeFatwa]

16. They deserve every cent over the cost of basic needs of everyone else

Wealth is not a human right.

Basic needs are.

[TAH6988]

22. Basic needs are actually pretty low

Especially wehn we start taking out TV's, radios, cars (you can bike to work), etc. Food, shelter, and health care are pretty much it.

[DuctapeFatwa]

52. Basic needs are not the same everywhere

Biking to work is a terrific option for people who live in a place with a pleasant climate a few miles from their workplace!

It might not be such a great idea for people who live 20 or 30 miles from where they work, have kids to drop off, frequent snow, or employers whose idea of business casual does not include perspiration.

Whether electricity etc is a basic need will be different depending on whether you are a subsitence farmer in a rural village or a worker in an urban area.

Basic needs would not include a coat or earmuffs for someone in Miami, but would be pretty important in North Dakota.

You get the idea - if everyone has what they really need, there is no problem with rich people being rich.

Prosperity, even wealth, is not evil or even unethical as long as it is not accumulated and held at the expense of someone else's well-being.

[TAH6988]

54. That said ,there

are plenty of "poor" who have well beyond basic needs. I'm not sure that saying "give everyone their basic needs, then everything else is fair game" is what we need/want.

[DuctapeFatwa]

71. You bring up an interesting point

There are people in the US, maybe some other places too, who are in the odd position of having some things that they don't need at the same time that they are far from having a secure grip on what they DO need.

For example, low income housing has dwindled almost to non-existent in many American cities, while prices of some consumer goods are very low. So it is possible for person to have several pairs of $20 sneakers from Wal-Mart but no hope of affording an apartment, even if they secure two full time jobs.

It is also very common to find low income people who do not have good nutrition, because they eat mostly junk food, simply because they do not have the resources of time, access and money in the right combination to prepare or obtain wholesome meals.

For example, children of low income single moms may frequently eat cookies and french fries, because those are accessible and rapidly obtainable, and which they do not need, whereas fresh vegetables, which they DO need, are more difficult to obtain, financially, timewise, and logistically.

So to say everything above everyone's basic needs is fair game is not as cut and dried as it seems, because systemic changes - complete restructuring of economies - would be necessary to make those basic provisions, thus going far beyond the raw materials costs.

In the US alone, we are talking about everything from how far people live from where they work, a phenomenon that has evolved over time for the express purpose of segregating the poor, to locations of farmers markets and even large supermarkets, which, for reasons of profit, tend to prefer locations nearer affluent areas and farther from public transportation, while the poorer areas are generally served by small convenience stores who charge higher prices than the suburban supermarket for the same items, and offer very little in the way of fresh produce and healthy staples, round the circle again - small demand for that when everyone is working or riding buses too many hours a day to cook!

When the free market value of a day's work falls below the free market value of a day's survival, the incentive benefits of a free market system no longer apply.

What we are transitioning to now is not a free market at all, but a return to feudalism, where the state, rather than serving as a check and balance system to unrestrained greed of an elite dwindling in number but increasing in bank balance, becomes an active participant in the very exploitation that a healthy economy and a free market depends on the state to preserve!

[Nikia]

17. It depends

Some rich people do or have worked hard to build businesses and some are fair to their workers in wages and benefits and have helped out workers as far as pay advances or paying for extra sick days for serious illness or accidents. Some other rich people have given money to worthy causes and people or have started such philanthropic organizations.. These people deserve their money as does anyone else.
Other rich people aren't really using their money to help anyone or really contributing to their businesses. These people may not deserve their money as much. On the other hand, there are upper middle class and middle class people who may not deserve their money either but everything is just on a smaller scale. I think that all people deserve to have their basic needs met so that is why I am not picking on the poor this way.
I suppose I'll steal a line from Spiderman "With much power (money), comes much responsibility."

[RichM]

20. I pretty much agree with you. Here's an argument you didn't specifically

bring in, on the question of "Do rich people deserve their money?" --

Government is not neutral; it's controlled by the ruling class. The rentiers & large owners get to make all the laws, & invariably do so in a way that sweetens their own position, & makes life harder for everyone else. With the Bush admin, this is unusually blatant, but it actually ALWAYS has been like that. That's the nature of capitalism. (As Marx said, "The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie.")

When you get to make the laws, you can rig the system -- and they do. The extent to which they do this is not generally appreciated, even by educated & intelligent people. Just as you have many educated people who basically believe fairy tales like "America always stands up for freedom and democracy," you have many that really don't see the extent to which existing social structure is the way it is, simply to protect the rich.

Once you're able to use state power to protect & enhance your wealth, the system is no longer remotely fair. In this sense, the rich do not deserve their money, because to a very considerable extent, they got a lot of that money simply by buying power & influence.

There are of course arguments on the other side of the question. When a Bill Gates builds a productive enterprise like Microsoft, one must concede that he created something of unusual value. (Though once Microsoft got so big that it was able to exert leverage on the government, the element of illicit gain goes up, & real productive contribution starts to wane.)

On balance (& your comments about how rich heirs really usually maintain their wealth, contrary to popular legend -- those comments are on target), IMO, rich people are vastly over-rewarded. Most (but not all) of their wealth comes from skillful conniving & gaming the system.

PS - Your characterization of Democrats as a party that's "supposed to represent workers" -- this is not right. Working people are supposed to believe that, but it isn't at all true. The ruling class cleverly saw that having a 2-party system where one party pretends to represent workers -- this makes the system more stable, as it gives the illusion of choice. In reality, Democrats are very much like Republicans, & their existence functions mainly as a safety valve for society. The 2 parties work together to maintain class rule, & to ensure that nothing ever really changes. The Democrats exist mainly to give people the false hope that "if only we can elect a Democrat, then things will be better!" From the point of view of system stability, this is a clever device, because giving people false hope siphons off anger, yet does nothing at all to alter system fundamentals.

[recidivist]

23. The other word for "rentier" is "investor."

Some people talk about "the rentier class" as if it consisted mainly of a landed aristocracy, the members of which control the land because their great, great, great, great, great, ... grandfathers distinguished themselves on the battlefield or won favor at court.

Such elites have existed in the past, and still do in backwards countries, but in the developed world, wealth today consists primarily of capital. Rentiers live by investing. That is a useful, indeed necessary, social function. It is also something that governments are notoriously bad at, partly because governments tend to be dominated by very short range political calculations, and partly because of the tendency to corruption when dealing with other peoples' money. Societies that encourage private savings and investment tend to flourish economically.

Now, in a cosmic sense is it "fair" that Joe inherited a pot full of money, and I didn't? My answer depends on how I choose to look at it. I can, of course, choose to resent the good fortune of others, and many people do just this.

Or I can reflect that -- assuming of course that Joe's ancestors earned their money legitimately -- Joe's good fortune in no way injures me. I have blessings aplenty in my own life, though not a lot of money. And I have the same obligation as does Joe: namely, to use my talents and opportunities responsibly.

Still some people will resent those who are better off. "Rentier" often functions as a coded attack word for this attitude. I would note simply that those who despise rentiers have a simple solution: don't borrow money.

[mainer]

62. This thread scares me

Thanks for the thoughtful comments.

Frankly, the comments from some folks here scare the hell out of me. They smack of envy and ugly rage and echoes of "Gimme what Joe has! I want a piece of his pie!"

Well, if Joe built a business from the ground up and labored there honestly for thirty years, those who envy him, but didn't have his foresight and determination, don't deserve a piece of his pie.

In every field there are the superstars and the also-rans. Every horse can't be Seabiscuit. Should we divvy up the race purse so that every horse gets the same amount? After all, they all ran around the same racetrack!

[IrateCitizen]

63. Nothing occurs in a vacuum...

Well, if Joe built a business from the ground up and labored there honestly for thirty years, those who envy him, but didn't have his foresight and determination, don't deserve a piece of his pie.

The problem here is that Joe DIDN'T do this all by himself. I would guess that he relied on roads and rail that were not built by him for transportation, telephone lines that he did not build for communication, computers for record keeping and communications that he did not create, an education in a school system that he did not create, and ... well, you get the picture.

No business could ever succeed were it not for the advances made by SOCIETY before it ever came into being. THAT is the theory behind progressive taxation.

But we can take this a step further. What kind of product does Joe make? How does he treat his workers? What opportunity does he give for his workers to enrich society (within their families, communities, the arts, etc.)? Is his business driven just around making profits, or does he actually contribute something meaningful to the common good -- and I'm not talking about just capital here?

There are many questions needing answers from your simplistic analogy.

[mainer]

74. I consider myself a "Joe."

No, I don't own a factory or even employ anyone. But I started at the bottom of my chosen career (in the arts) and after twenty plus years I'm happily at the top and, by any measure, wealthy. How am I, in any way, an enemy of the "worker"? Why do you think that everyone who manages to make their own wealth has done it illegally or unethically? Why do you think it's unethical for me to take my earnings and place them in safe investments to ensure a comfortable retirement? (while at the same time donating generously to every socially responsible cause I can think of?)

What makes you think that I'm your worst definition of a Republican?

I personally resent the implication on this thread that the wealthy are somehow morally corrupt. Or that we desire wealth in order to "be happy." I happened to succeed at my career because I love what I do -- the wealth came as a happy by-product. Is Bruce Springsteen corrupt? Or Barbra Streisand? Or the Dixie Chicks? Should we all go knocking down their doors and DEMAND that they hand out their money?

As someone who paid 50% of my income to taxes (and did so willingly, because I believe in supporting government and all the benefits it bestows on society) I will tell you now that it's comments like the ones on this thread that make me wonder sometimes if the Republicans aren't correct when they accuse Democrats of class warfare.

[RichM]

75. You're distorting the argument. It isn't about individuals,or you

personally. Look how you represent the argument: I personally resent the implication on this thread that the wealthy are somehow morally corrupt... Then you single out Bruce & Barbra, pretending that they're quite representative of the wealthy - which they're not. Most of the wealthy didn't make their money by hard work & talent. Most wealth comes from inheritance, class advantage, ruthlessness, & various forms of conniving. For every Barbra, there are hundreds of George W. Bushes, & the types of sleaze that surround him and backed him. The Ken Lays, the Richard Grassos, the Bernie Ebbers, ad infinitem. Even the great American Robber Barron fortunes - which at least involved the building of actual enterprises - also involved tremendous corruption, which led to the awarding of massive favors (land grants, subsidies, etc) from the federal government.

The argument is not that (as you put it) "everyone who manages to make their own wealth has done it illegally or unethically." The argument is that, as a class, the wealthy get to make the rules that everyone has to play by. MOST of it is a titanic swindle, and your naming a few exceptionally talented individuals is no refutation of the class generalization.

As far as "Democrats" being the ones waging class warfare - you're a mile off base here too. Most Democrats, including many or most on this board, would probably agree with YOUR viewpoint. Most Democrats, alas, lack the gonads for class warfare. Just mention that word to them and they all get sweaty palms.

[lancemurdoch]

64. inheritance

I'm mostly talking about people who inherited their money, such as that majority of the Forbes 400 richest Americans who inherited over $50 million at birth. No "building a business from the ground up, and especially no "labor there honestly for thirty years", unless you consider Paris Hilton snorting some cocaine, or Andrew Luster forcing some girl to have sex with him before fleeing to Mexico, or John E. DuPont shooting one of the wrestlers he invited to come live on his estate "working".

I also love the image I often get of people who supposedly singlehandedly build giant businesses like Atlas holding up the world. As if someone like Sam Walton built Wal-Mart through an act of Herculean will, with the thousands of cashiers, truck drivers, warehouse workers and so forth had nothing to do with it. Actually, if you really want to make the case for that sort of thing, you could point to someone like Warren Buffett, who made most of his money without a large staff. But then again in his case, he makes money because his stocks go up, they go up because earnings go up, and earnings go up because people are working to make them go up. So even in his case he can't take credit for his whole fortune, he just is very good at seeing where capital investment leads to growth.

[RichM]

68. What if Joe bribed key congressmen to get subsidies, tax breaks, &

other favorable legislation, appointments, etc that greatly helped his business?

[Liberal Classic]

24. I think the real question you mean is...

Do they deserve to keep it. :)

[mainer]

26. I'm sorry, but this is the sort of thread topic ..

that earns us a bad rap as a confiscatory party.
What does this mean, do the rich deserve their money? That no matter how they earned it, that they're not entitled to it? There are always some people with extraordinary abilities or farsightedness who should be rewarded for their talents. Does Bill Gates deserve to be rich? Does Warren Buffet?

I think they do.

They also need to be taxed at accordingly higher rates, but I don't think either of those men is opposed to that.

Among members of the Democratic party are many wealthy, socially conscious people who are willing to pay their fair share of taxes. In the Maine town where I live, those most likely to be Democrats seem to be the upper middle class or wealthier. (While the most ardent Republicans are those struggling families who fly the flag outside their double-wides.)

Don't demonize the rich. Many of them are our best allies.

[DemVet]

76. Good Point.

I agree. :toast:

[DrGonzoLives]

29. Well

In a perfect world, people who earn income without producing anything would not earn a lot. In a perfect world.

The problem is, what is "producing"? When I was still working, the main thing I produced was reports outlining safety deficincies or validation protocols to make the FDA happy. Was I producing anything that led to profit? No. What I did was necessary, yes, but not producing.

Therefore, by that reasoning, I should not have earned a lot of money despite the rather intense four-year training that I had.

So, there, that's the first problem I have with that idea.

Second, what would be the incentive to research new products and technology if people owning stock could not make money? Your idealism does not, and will not ever, extend to the vast majority of people on the planet. There has to be some incentive for someone to invest in a company, else it will not happen.

So, while I think that capital gaines (which is basically what you're talking about) should be taxed higher, doing away with the "rentiers" simply wouldn't be beneficial as a whole.

[IrateCitizen]

30. I'd rephrase this your question as, "What kind of society do we want?"

Which, in turn, changes the definition of "rich".

I'm glad that several people brought up Marx on this thread. Marx is often classified as a crackpot economic theorist by his detractors, when, in fact, he was much more of a social theorist. The primary basis of his theory of communism was not the sharing of wealth, but the enrichment of life.

Over 150 years ago he recognized that simply gaining a bigger piece of the pie did NOT make us happy. What he theorized, instead, was that the gains in productivity be used, rather than to fuel the expansion of industry (and manufacture of more and more superfluous junk), to allow a significant reduction in the amount of time that people spend working. The idea behind this is that if people don't have to spend as much time working, they are freer to enjoy the pleasures of LIFE -- family, the arts, nature, etc.

Given the way in which our increased productivity has only resulted in us being the most overworked and overstressed population on the face of the earth, I think that his basic theory has some basis.

Now, there are people who are rich who are attempting to use their wealth to drive home these kinds of concepts, or at the very least to use it to benefit society-at-large (like the group "Responsible Wealth"). It seems that many of them have found that money is NOT the key to happiness -- that, quite often, good works are. I have absolutely no qualms whatsoever with these "rich" people.

However, it is those rich (many of them rich only because of the uteran lottery) who see their wealth as an entitlement, and contribute nothing to the enrichment of society, who draw my ire. But, then again, their fault lies not in money as much as it lies in attitude.

Seeing as how I am a person interested in simplifying my life as much as possible in order to achieve greater happiness, I think that your focus is kind of attacking the issue from the wrong angle. What we need to do first is to dispel the myth perpetuated by our consumerist society and advertising agencies that tells us that money=happiness. Once that myth is effectively destroyed, then the idea of being "rich" won't be idolized as it is now, and the motivation of "getting rich" or "holding on to vast fortunes" will be an outmoded (and publicly rejected) one.

I mean, do you really think that somebody like Paris Hilton would flaunt her undeserved monetary wealth with such audacity if she were belittled by society (rather than strangely celebrated) for doing so????

[Nikia]

38. Money=Happiness is the problem

While it is true that people who facing losing their homes, having their heat shut off in winter, and not having enough money to put gas in their car to get to work may not be very happy, having excess money does not make people happy.
I have seen the folly of some members of the upper middle class. They buy a big house in a good neighborhood when they would have been just as happy or happier with a smaller house elsewhere. They buy a car of status when they'd really like one half the cost. They buy snow mobiles, boats, and atvs that they rarely or never use. They buy clothes that they don't like (I remember a team mate in high school complaining that she hated her $500 prom dress.). Everything they own is about proving that they have money. I prefer richer people to who having money is no big deal and use their money more usefully.
We should admire people more on their accomplishmens anyway as opposed to their money. What does having a lot of money have to do with anything.

[Deja Q]

35. consider these points

If they see employees trying to unionize, corporations will react as harshly as they can.

Corporations are also moving lots of good, wholesome jobs overseas as a means of "cost savings" (though we, the consumers, won't see a change of price for related products in our favor; indeed prices will continue to go up.)

Corporations won't do anything for the good of the workers or society unless they are forced to. They are driven by profits and their own checkbooks. That sums it up and that's why e need regulation. You will never find an honest CEO in America.

[stickdog]

40. Government is not just income redistribution.

Defense, police, jails and the court system all disproportionally serve the rich who would need to hire their own standing armies without them.

Imperialism, roads, enforced standards of commerce, infrastructure investments and even a bare bones social safety net also disproportionally serve the rich.

The rich should, therefore, pay their fair (much larger) share for the costs of these government services.

[ProfessorGAC]

46. Mostly Yes, If Not Inherited

Deserve is a hard word to clearly define. Who deserves what and how much? Pretty tough question.

I buy that some regulations need to be in place about maximum earning potential for corporate leadership. Some companies do the right thing. There are companies out there of significant size (like the one i work for) where the highest paid person only makes about 18 times that of the typical line worker (including bonuses). At many large companies, that number is more like 600!

Yet, these more judicious CEO's are still rich. Do they deserve the money? If the company is well run and everyone is stable in their employment, then yes. But, it's hard to imagine that anyone is worth 600 times what the average line worker makes. So, in that case, i'd say the answer no. But, once again, it's dependent on my definition of deserve.

On your justifications, i'm not really a fan of Adam Smith's simple approach to economic theory. And, there's plenty to support that the "invisible hand" is more likely to slap down the average worker, than stimulate a better economic environment for all. So, that's not a sales point to me.

As far as inherited wealth, i am foursquare for the estate tax. Huge inheritances breed sloth amongst the upper classes, and has in nearly every society to which i've had any historical exposure. It's unhealthy and unwise to grow up in privilege, and never have to apply oneself. Of course, if you did this, you could accidentally become president. Just look at Georgie.
The Professor

[haymaker]

47. What is this, Macro-economic Theory 101?

Or is it micro?

[NashVegas]

50. "Live off the Income of Your Income"

First, to answer your original question - if they work for it, if they use their smarts and accumen and treat those who help them amass their fortune with decency: yes.

Else:

Among the American aristocracy, the rule is that you *don't* live off of your capital (a heinous mistake), or even your income; you live off the income of your income - ie, investments. That's how small fortunes become BIG fortunes and are amassed and passed on down generations.

So, if you own homes and rent, you invest that rent money and live off of its profits. Likewise, on your stocks and bonds, you'll use a portion for living, a portion for re-investing. That's if you don't hold a job, then I guess you're free to do whatever.

Why not just organize and prevent them from expropriating all of that at the workplace to begin with? That's where I stand. I think the Democrats, and political parties that (are supposed to) represent workers main duty is to keep the government off the back of workers trying to organize.

In theory, you're absolutely correct.

In practice the unions, in their current incarnation, seem to exist more for hanging on to union executives' power, rather than the workers who send portions of their paychecks. Look at the deal that was recently cut to allow 10,000 auto manufacturing jobs go away / overseas. WTF?

The first step needed to put workers in a position where they get what they deserve as the *creators* of wealth is that we have to give up our credit cards and all unnecessary monthly bills.

We have to expect and prepare for an initial lower standard of living and a slower economy. Where we've hurt ourselves - and liberals especially don't want to hear this - has been in our drive to establish so much personal independence and geographic mobility; we've split up our families, we've moved thousands of miles away the cores of our families, the result is that we've weakened what would be necessary support to fall back on in the hard times that would come. If workers really want to get our shit together and demand what we're entitled to as the creators of wealth, we have to know the aristocracy is going to fight it tooth and nail and be prepared to dig in for a good long time. Government is not going to fight this battle for us, they are OWNED by the aristocracy now.

[IrateCitizen]

59. That's an incredibly accurate way of looking at it, IMHO.

When you talk of the wealth required to "live off the income of your income," you are talking about well over the lowest rung of deca-millionaires. The term "rich" is so often thought to include the doctor who makes $400K per year or the small-to-medium business owner with a net worth in the low millions. These people are merely "well-off", hardly rich.

Equally important is your last paragraph. I really can't say much else to add to it, so I'll just nod my head in agreement.

[ButterflyBlood]

65. no

n/t

[ibegurpard]

66. Was it obtained legally?

Then, yes, they deserve their money. However, I also believe that they should bear a greater share of the tax burden. Taxes have built and maintained infrastructure and organizations that have created an environment that is conducive to stability and economic growth in this country. Since the rich benefit the most from this, it is incumbent upon them to pay the lion's share of the cost, IMHO.

[Blue_Chill]

67. If earned legally, yes.

you can't fault someone for playing within the rules. If they break the law then you could make a case for them not deserving to keep it.

Also a worker goes to a factory and creates wealth is the basis of your argument. The worker is creating the wealth. You however left out the part about how the factory got there, and how much had to be invested and thus risked for the factory to be their in the first place. The worker can't create ANYTHING if someone doesn't provide a place for him to work.

[lancemurdoch]

70. how the factory got there....

The way that the factory got there is that bricklayers came and laid the bricks for it, electricians came in and did the wiring, and then machines from another factory, made by other workers, were installed there.

Capital is necessary in order to create wealth, yes, but on the other hand, you need workers in order to make use of (create wealth with) capital.

As far as risk - if you take an aggregate of all capital investment, and see what the average return is, in that sense there is no risk. Of course, on a smaller level it is different, and gets more complicated, but is also interesting, although there is a lot to go into regarding that.

[AP]

69. People who work hard & contribute value to society deserve to reap rewards

of their labor.

There is a certain amount of wealth that Bill Gates absolutely deserves.

Wealthy people who use monopoly power, try to screw markets, who make money off of tricks of financing, and who hold back others who are trying to contribute value to society through innovation and competition don't deserve more wealth.

There's a certain amount of wealth that Bill Gates definitely doesn't deserve.