The 2022-23 Economic Crisis Megathread

[garbon]

The wealth they "capture" is the wealth they create.  Taylor Swift is not an oligarch.  Get real.

Presumably more of that wealth created could be spread more broadly among those involved aka not so skewed toward the big boss?

[Admiral Yi]

Presumably more of that wealth created could be spread more broadly among those involved aka not so skewed toward the big boss?

Go get 'em.  If you assemble a voting majority that want a wealth transfer, I will not stand in your way.  But I will continue to object to attempts at demonizing the rich in order to attain that goal.

[garbon]

Presumably more of that wealth created could be spread more broadly among those involved aka not so skewed toward the big boss?

Go get 'em.  If you assemble a voting majority that want a wealth transfer, I will not stand in your way.  But I will continue to object to attempts at demonizing the rich in order to attain that goal.

But it doesn't have to be that way? Taylor Swift could easily have changed the profit sharing arrangements of her tour to take less of a cut? Why should we deny them agency?

[Tamas]

More on the topic, looks like the "most telegraphed recession" failed to materialise. The job market remained resilient most everywhere, at least until now and despite talking the QT talk the Fed did not hesitate to jump in and help out banks being dragged down by bonds they held which had been made worthless by the rate hikes.

I am not sure inflation isn't a bit sticky at where it is now (in the US), but it seems soft landing may have been achieved. Except that for the last few FOMC press conference, I noticed nearly every question to the Fed chair was "when are rate cuts?" which is telling me people are antsy about it and want rates to go down, which I am finding sus in regards to issues under the hood.

[Syt]

The wealth they "capture" is the wealth they create.  Taylor Swift is not an oligarch.  Get real.

Create wealth from where? Is it going at someone's expense?

Looking at the chart comparing development of top 10% vs bottom 50% ratio (larger number indicating the gap between them growing) seems to indicate that income inequality in the US is increasing:



Keeping in mind that while the GDP per household went up considerably, the median income did not keep pace:



See also median income with and without adjustment for inflation:



Keeping in mind that corporate profits in the past 10 years or so rose by almost 50%.

[Tamas]

Well one way wealth is "created" is e.g. Tesla stock price going up (when it used to) and Musk declared to be X billions more wealthy. Which is ridiculous.

[Syt]

Which is why I think looking at GDP/income data is more useful, as "stock billionaires" is largely speculative till they cash out (though of course it also translates to "real" wealth/resources to some degree. If Elon goes to the bank to get something financed for xx millions, he'll get a different response than if I do it.

Still, indication seems to be that for a small group things get better while others do GoFundMe campaigns for their insulin or work three jobs while living in their car.

[Josquius]

Income inequality in the world at large is of course completed fucked. Its shooting to absolutely insane levels in recent years.
But in the music industry in particular I wonder how things are. I do get the impression its even more broken there.
It is certainly a fact it is no longer possible for most solid mid-level artists who can pack sub-arena sized venues to support themselves full time just from music. Meanwhile Swift and the ilk do seem to be just as wealthy as your classic rock star. Or moreso?

Create wealth from where? Is it going at someone's expense?

Looking at the chart comparing development of top 10% vs bottom 50% ratio (larger number indicating the gap between them growing) seems to indicate that income inequality in the US is increasing:

I don't like this top 10% vs. bottom 50% at all. Apparently in the UK 40k is enough to put a single person in the top 10%, which really doesn't give them a wealthy lifestyle at all.
With inequality where it is today you have to look more at the 99 vs. the 1%. Or less even.
Its part of the standard populism for dummies guidebook to try and convince the bottom 50% that the next lowest 40% are the problem.

[Admiral Yi]

But it doesn't have to be that way? Taylor Swift could easily have changed the profit sharing arrangements of her tour to take less of a cut? Why should we deny them agency?

I don't see how pointing out that she didn't capture anything is denying her agency.  She didn't find money roaming in the wild and put it in a cage.  She found money in people's pockets and offered them a deal which they were free to accept or decline.  She found roadies and makeup and wardrobe and dancers willing to contribute for what she was offering.

[Admiral Yi]

Well one way wealth is "created" is e.g. Tesla stock price going up (when it used to) and Musk declared to be X billions more wealthy. Which is ridiculous.

Why is that?  Shares can be turned into cash at will.

[garbon]

But it doesn't have to be that way? Taylor Swift could easily have changed the profit sharing arrangements of her tour to take less of a cut? Why should we deny them agency?

I don't see how pointing out that she didn't capture anything is denying her agency.  She didn't find money roaming in the wild and put it in a cage.  She found money in people's pockets and offered them a deal which they were free to accept or decline.  She found roadies and makeup and wardrobe and dancers willing to contribute for what she was offering.

Because she has more power than everyone you listed below. She could freely leverage that power to request less for tickets (to her credit she has been warring with situation with ticketmaster) but more importantly pay all those who work for her better wages. She doesn't have to keep the lump sum and I think fair if people want to take issue with her self-enrichment.

[garbon]

Note just sticking with Taylor as that's example provided but really using her as proxy for generic 'big boss'

[HVC]

Well one way wealth is "created" is e.g. Tesla stock price going up (when it used to) and Musk declared to be X billions more wealthy. Which is ridiculous.

Why is that?  Shares can be turned into cash at will.

If it's that accessible why isn't it taxed as such? Serious question. Don't really get the unrealized status. Maybe not at full pop, but why no tax at all?

[The Brain]

I don't see the problem with having rich people. The modern state is so huge that "the overmighty subject" is unlikely to be a real problem except for tiny states. And as for other effects, how is my life worse because there are rich people? If I have a great business idea but not enough money there are people I can ask for funding. Etc.

Robin Hood (if you will) only makes sense when the wealth is somehow ill-gotten. Which it can be, expecially in some parts of the world, but not as a general rule.

In a society with equal opportunity, where everyone gets access to education and healthcare and society is ruled by non-insane law, some people will amass much more wealth than others. Where's the harm? Sweden has more USD billionaires per capita than the US. There is no contradiction between land of opportunity and land of (meaningful) equality.

Seems to me that in the US some people look at the problems in society, semi-ignore them, and instead look at rich people. I would argue that US society would improve (using conventional ideas of good/bad) by changes to the way for instance healthcare and education work. Those are some areas that could use fixing. Now given the maybe non-optimal current system the wealth the rich have in the US could conceivably be considered partly ill-gotten. That still doesn't make cutting rich people down to size the real answer to the real problems. It's a bit like putting metal detectors and security guards in schools instead of dealing with the gun situation. Possibly not insane, but not the long-term answer.

At least one guy from my high-school class has become very wealthy. He co-founded a business, created value for customers and reaped rewards. Extremely pleasant, helpful, and likeable guy. I fail to see the horrible harm.

[Admiral Yi]

Because she has more power than everyone you listed below. She could freely leverage that power to request less for tickets (to her credit she has been warring with situation with ticketmaster) but more importantly pay all those who work for her better wages. She doesn't have to keep the lump sum and I think fair if people want to take issue with her self-enrichment.

You have the ability to overpay for anything you want to.  You have the ability to give a gift to anyone you want to.  You have not sent me a gift but that does not mean you have captured anything from me.  If you want to assign this meaning to capture then let's apply it to everyone.