Poor rich people

[vimothy]

Yeah, this is the most obvious issue with the statement made. Before we get onto the possibility of starting out with enough money to be the, er, Idle Rich, in a free market economy the things that increase your economic worth (education being the most obvious one) are going to be entirely dependant on your or your parents' ability to pay for it.

Nope.

First off, we already live in a market economy, though there are numerous government interventions and plenty of pork - and even, in the UK, a strong Nu Labour tendency towards soc*alist economic control. Of course, we should be trying to make it free-er and to limit the government's meddling.

Regarding education, the chief (even generic) "neo-lib" suggestion has always been to buy but not to suppply, i.e. pay for education (because it is a merit good), but don't run it (using a voucher system). (I can only assume that you are either unintersted in double-checking or are deliberately trying to mislead).

Finally, it is simply not the case that all the things required to increase your economic worth are (or are going to be) entirely dependent upon your parents ability to pay for them. Here's some really obvious ones:
Punctuality
Inter-personal skills
Patience
Sobriety
Work based learning/CPD
Holding down a job for more than a few weeks

& the rest...

 

[swears]

Finally, it is simply not the case that all the things required to increase your economic worth are (or are going to be) entirely dependent upon your parents ability to pay for them. Here's some really obvious ones:
Punctuality
Inter-personal skills
Patience
Sobriety
Work based learning/CPD
Holding down a job for more than a few weeks

& the rest...

Isn't a person from a stable, wealthy background generally more likely to see the value of these personal attributes anyway?

 

[baboon2004]

Obviously, middle managers on £50k per year are not "incredibly productive", that's why they're only earning £50k a year. In a hypothetical situation, let's say a generic corporation, middle managers are more productive than data entry clerks and hence recieve a higher wage. If this were not the case, any approriately money grabbbing capitalist company would surely pay their middle managers a lot less, or possibly just sack them.

"Trickle-down theory" - that's nothing but rhetoric, baboon2004, as a concept in general, and I don't see how it's relevant here. Perhaps you could explain.

Eh? Like what?

1/ In my experience, a lot of people on £50K kind of salaries aren't more productive in any meaningful sense; rather they just use previously-accrued advantages (excellent contacts being the primary example), often accrued by people other than themselves, to further the business.
I don't see capitalism as the perfect model it purports to be. I think most people will have seen lots of evidence of people in high positions who are there because of previous achievements (and not how productive they are NOW), sycophancy, 'playing the game', 'fitting the mould' etc. To suggest that most businesses are ruthless models of efficiency is laughably contrary to experience.

2/ It wasn't meant as rhetoric, just shorthand for the argument you presented - it's just the theory that giving the 'top people' the opportunity to earn megabucks entails that all of society will eventually benefit. Think Nozick (one of Thatcher's favourites) coined the term, IIRC.

3/ re lots of vital jobs paying abysmally/not being respected - where shall we start? Binmen, nurses, teachers, blah blah blah. All more vital to a well-functioning society than many people paid way more.

 

[vimothy]

Well, leaving that debate aside for the moment it contradicts what your friend just said about the top people being richer because they have produced more, they may have just inherited it.

Leave it out rich - those people who inherit wealth do so because somone else has made the (frankly extremely long and arduous) journey from poverty to wealth. That's there perogative, and as it's their effort it should be their cash as well.

In most countries around the world and throughout history, the wealthy and the poor are a distinct group. Socialism is no better than fuedalism in this respect. Capitalism is different - presisely because it is meritocratic.

OK, worth was a bad choice of word. I meant is someone earning ten times as much as someone else (possibly from the interest on what they inherited) ten times as productive as that person and ten times as much of an asset to society?

In economic terms, yes.

Do you really think it's not true or are you just trying to score points?

No I'm not trying to score points (I shouldn't need to say that). I want to know if that's true and what the data says.

You've correctly identified another problem there. Once I've made money (possibly by being productive, possibly not) I can then increase my pile by owning land or shares or just earning interest. In other words, if you have money it is easier to make more money. this does not necessitate being productive and I can't really see that it's a good thing.

The mysterious world of finance! What I want to know is, why is keeping your money in a bank not productive? If it's of no use, how come the bank keeps giving out interest? Ditto investment.

 

[vimothy]

Isn't a person from a stable, wealthy background generally more likely to see the value of these personal attributes anyway?

I disagree, because that pre-supposes that poor/less wealthy (however we're defining it) people are incapable of functioning in a civilized manner - is that why we have to spend so much money keeping junkies in skag, just make em happy and somewhere else?

Anyway, there's an iron-clad dismissal of this argument (IMHO): my (our?) parent's generation. They were undoubtably poorer than today's poor, yet there was a huge movement from working to middle class. As an example, my father grew up in a two bedroom flat with my grandparents and nine siblings, as a catholic in west belfast. You can't get poorer than that, in this country, today. All of his brothers and sisters now are successful people with families and their own homes. Some have become very rich (one millionaire), others are still doing semi-skilled jobs, while most are in the middle (academics, journos, writers, etc). What does that prove? It proves you don't need to have rich parents to succeed - you just need to be civilised, get a job and work hard. If you're lucky, you'll be loaded before you die, but if you're not, you'll certainly at least be better off.

 

[baboon2004]

I disagree, because that pre-supposes that poor/less wealthy (however we're defining it) people are incapable of functioning in a civilized manner - is that why we have to spend so much money keeping junkies in skag, just make em happy and somewhere else?

Anyway, there's an iron-clad dismissal of this argument (IMHO): my (our?) parent's generation. They were undoubtably poorer than today's poor, yet there was a huge movement from working to middle class. As an example, my father grew up in a two bedroom flat with my grandparents and nine siblings, as a catholic in west belfast. You can't get poorer than that, in this country, today. All of his brothers and sisters now are successful people with families and their own homes. Some have become very rich (one millionaire), others are still doing semi-skilled jobs, while most are in the middle (academics, journos, writers, etc). What does that prove? It proves you don't need to have rich parents to succeed - you just need to be civilised, get a job and work hard. If you're lucky, you'll be loaded before you die, but if you're not, you'll certainly at least be better off.

You certainly don't NEED rich parents to succeed, but it is a huge advantage. And there are lots of people who work hard all their lives, are punctual etc, who get jackshit for all their efforts.

And if capitalism is such a meritocratic system, why oh why are most people at the top of their capitalist professions still white males from a certain social class?

 

[Mr. Tea]

I think it's certainly not the case, as is sometimes claimed, that people at the top of the economic tree accrue and spend wealth in a way that is necessarily beneficial, or at worst neutral, to less wealthy people (including people with middling incomes, as well as the poor). The gap between rich and poor is increasing not because the poor are getting poorer, granted - it's because they're getting richer less quickly than the rich are, so the trickle-down effect beloved of neoliberal economists does happen, it just doesn't trickle all that quickly.

Suppose I have a fairly ordinary service-sector job and that because of an influx of wealthy people into the city where I live I now earn 10% more, in real terms, than I did a few years ago. I might have more cash in the bank, but there's been a 100% increase in house prices in the area, so there's no way I'll be able to move into a better house than the one I'm in even if I have the good fortune to own one in the first place, and if I'm renting there's practically no chance I'll ever get on the property ladder. The inevitable gentrification of previously working-class areas means that even going out for a pint or a bite to eat is now more expensive than it was. So in terms of purchasing power, I've actually gone down in the world.

 

[vimothy]

baboon2004 - a quick one before I get off home:

Disagree about "trickle-down", AFAIK it's just a (half pejorative) misunderstanding about the effect of tax breaks on the economy. I don't think it's an economic theory. Can you link to something or explain it to me, please?

 

[Slothrop]

First off, we already live in a market economy

Yes, I'm aware of that. But you tend to be talking about a free market, which I think you've defined as being a market regulating itself without state intervention or coercion.

Regarding education, the chief (even generic) "neo-lib" suggestion has always been to buy but not to suppply, i.e. pay for education (because it is a merit good), but don't run it (using a voucher system).

So would you allow for people to bypass this and pay for a private school off their own bat? If you would then you've not really bypassed the problem. If not, then you're saying that state coercion of the free market might actually be a good thing in some cases.

 

[IdleRich]

Leave it out rich - those people who inherit wealth do so because somone else has made the (frankly extremely long and arduous) journey from poverty to wealth. That's there perogative, and as it's their effort it should be their cash as well.

Leave what out? I don't care if Prince William's great-great grandfather made a long and arduous journey to wealth, I'm just pointing out that he himself is not of one the most productive people.

In economic terms, yes.

So someone who inherits millions of pounds and becomes a slum landlord is a productive member of society? If economic terms judge him so then economic terms are worthless.

No I'm not trying to score points (I shouldn't need to say that). I want to know if that's true and what the data says.

OK, I strongly believe that and I have seen statistics that bear it out but I haven't got them at my fingertips and I have to rush now but I'll see what I can find tomorrow ok?

The mysterious world of finance! What I want to know is, why is keeping your money in a bank not productive? If it's of no use, how come the bank keeps giving out interest? Ditto investment.

How come you missed out owning houses? Is that productive?
Innvesting money in a bank or elsewhere is benefitting someone but is it necessarily benefitting society?

 

[turtles]

Capitalism is different - presisely because it is meritocratic.

WOW. I mean, like, WOW.

And if capitalism is such a meritocratic system, why oh why are most people at the top of their capitalist professions still white males from a certain social class?

OTMx1000 so many other exceptions to "meritocratic" it's not even funny.

 

[swears]

I disagree, because that pre-supposes that poor/less wealthy (however we're defining it) people are incapable of functioning in a civilized manner - is that why we have to spend so much money keeping junkies in skag, just make em happy and somewhere else?

Well, it depends. How can you behave in a civilized manner if you don't see the point of it? People don't always act in their best interests.

What are the statistics on family background and adult income? I'd like to know.

 

[nomadologist]

Well, it depends. How can you behave in a civilized manner if you don't see the point of it? People don't always act in their best interests.

What are the statistics on family background and adult income? I'd like to know.

we pay to keep junkies on methadone so they don't kill people trying to steal cars, etc., so they can afford heroin. it's definitely worth the money--since the introduction of methadone clinics, street crime in NYC has steadily gone down. not solely due to the clinics, but many conjecture it's a huge part of why.

 

[nomadologist]

Anyway, there's an iron-clad dismissal of this argument (IMHO): my (our?) parent's generation. They were undoubtably poorer than today's poor, yet there was a huge movement from working to middle class. As an example, my father grew up in a two bedroom flat with my grandparents and nine siblings, as a catholic in west belfast. You can't get poorer than that, in this country, today. All of his brothers and sisters now are successful people with families and their own homes. Some have become very rich (one millionaire), others are still doing semi-skilled jobs, while most are in the middle (academics, journos, writers, etc). What does that prove? It proves you don't need to have rich parents to succeed - you just need to be civilised, get a job and work hard. If you're lucky, you'll be loaded before you die, but if you're not, you'll certainly at least be better off.

this was actually due to the post-war economy, not the ambitions of baby boomers

 

[swears]

Yeah, if all these "chavs" had jobs building ships, or mining coal maybe there wouldn't be so much trouble.

Yeah, yeah I know...but how can you say that the poor aren't at the mercy of the current economic climate?

 

[nomadologist]

drugs addicts and impoverished people are not one in the same category, though there's tons of overlapping

 

[baboon2004]

baboon2004 - a quick one before I get off home:

Disagree about "trickle-down", AFAIK it's just a (half pejorative) misunderstanding about the effect of tax breaks on the economy. I don't think it's an economic theory. Can you link to something or explain it to me, please?

Maybe I have got the wrong name for it - fair enough. My memory seems to be deserting me these days. The idea I was referring to was this, from your original quote:

"Whenever a Bill Gates arises to make his fortune, the income disparity between top and bottom increases--but so does everyone's standard of living. If so, why shouldn't we welcome an inequality--including a widening inequality--in incomes?"

What I disagree with is the unsubstantiated jump from arguing that if Bill Gates and his ilk are contributing to improving everyone's standard of living (which some people would argue with anyway - I'm kind of agnostic here), then inequality should be welcomed as a general concept. Just because SOME people who earn more 'contribute' more to the general standard of living, then this does not justify welcoming economic inequality. There are lots who contribute practically nothing, yet big up big pay cheques month after month.

 

[baboon2004]

Well, it depends. How can you behave in a civilized manner if you don't see the point of it? People don't always act in their best interests.

What are the statistics on family background and adult income? I'd like to know.

The most recent study I saw positioned Britain at the bottom of the social mobility charts, with a very strong correlation between the income bracket of one's parents and one's own income bracket. Tho' the US was surprisingly low too. As for exact figures, I don't know.

 

[baboon2004]

"big up big pay cheques month after month."

Ahem, 'pick up big pay cheques'. Though maybe they big them up too, depending on how embarrassed they do or don't feel.

 

[swears]

...a very strong correlation between the income bracket of one's parents and one's own income bracket...

Yeah, that's pretty obvious isn't it?