>The poor should be thanking the rich, not resenting them. The rich are the reason why the poor are getting by at all. Many of the poor are not pulling their own weight, while the wealthy are pulling much more than their weight.
You’re far smarter and no doubt richer than me, so first of all, thank you for that. I’ll try harder, but you know me. Still, I’ll push back.
I think you might rely on flawed economic reasoning and a false comparison of stereotypes to suggest that even the hardest working poor are bad for the rich, while the laziest rich are good for the poor.
I read somewhere the poor manage to be a meaningful part of the consumer base. You assert that eliminating 20% of the poor isn’t a problem since it won’t affect productivity but you never mention their role as consumers. Who’ll buy all the cheap shit produced for the missing poor?
I imagine you could find some righties who’d agree with your rightist characterization and some who wouldn’t. Can you find any lefties who’d agree with your leftist characterization? If you can’t, does that suggest it could be a strawman? As you say there’s an empirical fact about which of the two descriptions better describes economic reality but this fact’s utility depends entirely on the accuracy of both descriptions and you might’ve missed the mark there.
What’s really sad is I’m not even a lefty and apparently they’re the ones lying to themselves to justify my existence.
I'm not surprised that I agree with this, but I hope it's not just confirmation bias. I can't see any factual errors. For an excellent essay on this topic, see economist George Reisman's "How the 1 Percent Provides the Standard of Living for the 99 Percent", available on Amazon for 99 cents.
"By the same token, a drop in population of 20% (over a long time period) would also have little impact on per capita productivity. But suppose we add that the drop will be a decline specifically in the least productive members of society, who are costing the state the most money and committing most of the crimes. In that case, the rest of society would plausibly be better off."
I don't think this point is sufficiently well-argued to be persuasive. If you remove 20% of the population evenly distributed across all levels of productivity, then yes, presumably we will still have the same shares of people filling the same roles, and productivity will remain constant. But I think you are making errors by i) viewing productivity as individual rather than a societal, interconnected trait; and ii) assuming that productivity only measures innate drive and talent.
On i) if we remove all grocery store workers and uber drivers from society, then instantaneously our average productivity might go up (assuming that salaries reflect productivity and grocery store workers and uber drivers are on the lower end of salaries) but pretty soon we will not have grocery stores or uber rides. How is this beneficial for the productivity of the remaining 80%, who now i) cannot buy groceries or take ubers or ii) have to leave their high-productivity jobs to become grocery store workers and uber drivers? (Note I think this response applies regardless of where we set the percentile, as long as people below that percentile still contribute *something* beneficial to society collectively).
On ii) productivity is not static. Young workers are likely overrepresented in the bottom quintile as they have not yet had time to acquire the skills and experience to be more productive. Removing young workers from society will make average productivity increase instantaneously, but is this really a path to long-term gains in productivity?
‘Poor people are poor because of bad luck. They happened to be born into the lower social class, and from there, it’s almost impossible to move up.’
I find this a crazy narrative for the US left to hold, as on the face of it, America has been globally considered the home of the self-made… the idea of arriving with just the shirt on your back and building a livelihood is, as far as I can tell, a tried and tested dream.
“The idea that everyone could be like the most productive people if only we gave them the right education is pure wishful thinking; there is zero evidence for it.
If there was such an amazing educational technique, don’t you think we’d be using it by now?“ But of course there are good teachers like Prof. Huemer and worse teachers like Karl Marx. There are better schools and worse schools. Education does make a difference in outcomes, just not as much as some want or claim.
Thanks for clarifying. I am still confused. Children born of parents A and raised by them resemble the parents. Children of parents A adopted and raised by parents B resemble parents A and not parents B. Children born to parents C but adopted by parents A do not resemble parents A. Is that it?
“In general, changes in the population have little effect on total productivity.” Is this true? Perhaps you’re doing something tricky here with time and population change — like a philosopher man of system tinkerer?
Here’s my perspective. Population typically changes gradually over time. Simultaneously culture changes. Typically we see that as population increases, specialization and trade increase. More specialization and trade typically lead to greater wealth. Hence a population increase typically correlates with greater wealth, (assuming relatively free markets).
“Similarly, given how many blue collar workers there are and how many capitalists there are, the marginal value of a capitalist is greater than the marginal value of a worker.”
I agree with the conclusion, but the explanation seems oversimplified at best. I assume we are speaking of averages. Sheer numbers have little to do with it. There are fewer welfare recipients than workers, but welfare recipients are not more productive. Perhaps it would be better to say, given how many persons are able and willing to become a blue collar worker at a particular wage as compared to how many are able to become a capitalist, the capitalists must be more productive. Since the reward is higher, the competition should be more intense (complicated by the need for starting capital). If the reward remains higher, there must be something holding it up. Of course, a leftist would say that cheating keeps it high. E.g. poor people find it more difficult to get a loan to start a business.
The psychology is difficult to understand. People on both sides seem willing to get upset about this issue, but don’t care enough to study the issues carefully. What is true does not affect anyone very directly, so we just argue about it rather than settling it with a bet.
"Imagine the amount of money to be made by the private school that actually took poor people and made them just as talented and productive as rich people. Given the huge increase in expected income, students could get loans for the tuition, which the banks would know would easily be paid back even with a hefty interest rate. There are plenty of rich leftists, yet none of them are willing to start up this business. Why not? Because all of them know that they would lose their shirts."
To be fair, isn't that what private student loan companies are doing? The expert consensus is that formal education causes an increase in wages, the "wage premium"--what's controversial is whether education increases the pay of graduates by conferring new skills to students vs. by certifying who has greater (pre-existing) abilities with a diploma. Even if you think all college does is offer a 4 year marshmallow/impulse-control and IQ test (and also tell us who conforms to social norms and who doesn't), if this results in a wage premium for graduates (which it does) you can (and people do) make money on loaning people funds to pay for their education.
But isn't the private student loan system backstopped by government agencies? I'm not certain, but I think that's the case. In which case, they are not really making a bet on the students they lend money to.
>The poor should be thanking the rich, not resenting them. The rich are the reason why the poor are getting by at all. Many of the poor are not pulling their own weight, while the wealthy are pulling much more than their weight.
You’re far smarter and no doubt richer than me, so first of all, thank you for that. I’ll try harder, but you know me. Still, I’ll push back.
I think you might rely on flawed economic reasoning and a false comparison of stereotypes to suggest that even the hardest working poor are bad for the rich, while the laziest rich are good for the poor.
I read somewhere the poor manage to be a meaningful part of the consumer base. You assert that eliminating 20% of the poor isn’t a problem since it won’t affect productivity but you never mention their role as consumers. Who’ll buy all the cheap shit produced for the missing poor?
I imagine you could find some righties who’d agree with your rightist characterization and some who wouldn’t. Can you find any lefties who’d agree with your leftist characterization? If you can’t, does that suggest it could be a strawman? As you say there’s an empirical fact about which of the two descriptions better describes economic reality but this fact’s utility depends entirely on the accuracy of both descriptions and you might’ve missed the mark there.
What’s really sad is I’m not even a lefty and apparently they’re the ones lying to themselves to justify my existence.
I'm not surprised that I agree with this, but I hope it's not just confirmation bias. I can't see any factual errors. For an excellent essay on this topic, see economist George Reisman's "How the 1 Percent Provides the Standard of Living for the 99 Percent", available on Amazon for 99 cents.
"By the same token, a drop in population of 20% (over a long time period) would also have little impact on per capita productivity. But suppose we add that the drop will be a decline specifically in the least productive members of society, who are costing the state the most money and committing most of the crimes. In that case, the rest of society would plausibly be better off."
I don't think this point is sufficiently well-argued to be persuasive. If you remove 20% of the population evenly distributed across all levels of productivity, then yes, presumably we will still have the same shares of people filling the same roles, and productivity will remain constant. But I think you are making errors by i) viewing productivity as individual rather than a societal, interconnected trait; and ii) assuming that productivity only measures innate drive and talent.
On i) if we remove all grocery store workers and uber drivers from society, then instantaneously our average productivity might go up (assuming that salaries reflect productivity and grocery store workers and uber drivers are on the lower end of salaries) but pretty soon we will not have grocery stores or uber rides. How is this beneficial for the productivity of the remaining 80%, who now i) cannot buy groceries or take ubers or ii) have to leave their high-productivity jobs to become grocery store workers and uber drivers? (Note I think this response applies regardless of where we set the percentile, as long as people below that percentile still contribute *something* beneficial to society collectively).
On ii) productivity is not static. Young workers are likely overrepresented in the bottom quintile as they have not yet had time to acquire the skills and experience to be more productive. Removing young workers from society will make average productivity increase instantaneously, but is this really a path to long-term gains in productivity?
‘Poor people are poor because of bad luck. They happened to be born into the lower social class, and from there, it’s almost impossible to move up.’
I find this a crazy narrative for the US left to hold, as on the face of it, America has been globally considered the home of the self-made… the idea of arriving with just the shirt on your back and building a livelihood is, as far as I can tell, a tried and tested dream.
“The idea that everyone could be like the most productive people if only we gave them the right education is pure wishful thinking; there is zero evidence for it.
If there was such an amazing educational technique, don’t you think we’d be using it by now?“ But of course there are good teachers like Prof. Huemer and worse teachers like Karl Marx. There are better schools and worse schools. Education does make a difference in outcomes, just not as much as some want or claim.
“this is nearly all due to genetics, not environment (it goes away for adopted children).” It goes away or doesn’t go away? What is “it?”
Yeah, if an effect disappears in children who get adopted, it is not genetic.
Children end up making similar money as their parents.
This effect is not present if they’re not their parents’ biological children.
Therefore, the effect is due to genes, not family environment/social status.
Thanks for clarifying. I am still confused. Children born of parents A and raised by them resemble the parents. Children of parents A adopted and raised by parents B resemble parents A and not parents B. Children born to parents C but adopted by parents A do not resemble parents A. Is that it?
Yes, that's it.
“In general, changes in the population have little effect on total productivity.” Is this true? Perhaps you’re doing something tricky here with time and population change — like a philosopher man of system tinkerer?
Here’s my perspective. Population typically changes gradually over time. Simultaneously culture changes. Typically we see that as population increases, specialization and trade increase. More specialization and trade typically lead to greater wealth. Hence a population increase typically correlates with greater wealth, (assuming relatively free markets).
What are you saying differently than me?
“Similarly, given how many blue collar workers there are and how many capitalists there are, the marginal value of a capitalist is greater than the marginal value of a worker.”
I agree with the conclusion, but the explanation seems oversimplified at best. I assume we are speaking of averages. Sheer numbers have little to do with it. There are fewer welfare recipients than workers, but welfare recipients are not more productive. Perhaps it would be better to say, given how many persons are able and willing to become a blue collar worker at a particular wage as compared to how many are able to become a capitalist, the capitalists must be more productive. Since the reward is higher, the competition should be more intense (complicated by the need for starting capital). If the reward remains higher, there must be something holding it up. Of course, a leftist would say that cheating keeps it high. E.g. poor people find it more difficult to get a loan to start a business.
The psychology is difficult to understand. People on both sides seem willing to get upset about this issue, but don’t care enough to study the issues carefully. What is true does not affect anyone very directly, so we just argue about it rather than settling it with a bet.
"Imagine the amount of money to be made by the private school that actually took poor people and made them just as talented and productive as rich people. Given the huge increase in expected income, students could get loans for the tuition, which the banks would know would easily be paid back even with a hefty interest rate. There are plenty of rich leftists, yet none of them are willing to start up this business. Why not? Because all of them know that they would lose their shirts."
To be fair, isn't that what private student loan companies are doing? The expert consensus is that formal education causes an increase in wages, the "wage premium"--what's controversial is whether education increases the pay of graduates by conferring new skills to students vs. by certifying who has greater (pre-existing) abilities with a diploma. Even if you think all college does is offer a 4 year marshmallow/impulse-control and IQ test (and also tell us who conforms to social norms and who doesn't), if this results in a wage premium for graduates (which it does) you can (and people do) make money on loaning people funds to pay for their education.
But isn't the private student loan system backstopped by government agencies? I'm not certain, but I think that's the case. In which case, they are not really making a bet on the students they lend money to.