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posted by n1 on Tuesday August 05 2014, @04:11PM   Printer-friendly
from the key-issues-with-no-solutions dept.

Recently SoylentNews posted a story about an article written by Tyler Cowen on the apparent fall in global inequality.

Professor Daniel Little, Chancellor at the University of Michigan-Dearborn wrote a response to Cowen's article that I'd like to share with SoylentNews.

Cowen bases his case on what seems on its face paradoxical but is in fact correct: it is possible for a set of 100 countries to each experience increasing income inequality and yet the aggregate of those populations to experience falling inequality.

Incomes in (some of) the poorest countries are rising, and the gap between the top and the bottom has fallen. So the gap between the richest and the poorest citizens of planet Earth has declined.

But this isn't what most people are concerned about when they express criticisms of rising inequalities, either nationally or internationally. They are concerned about the fact that our economies have very systematically increased the percentage of income and wealth flowing to the top 1, 5, and 10 percent, while allowing the bottom 40% to stagnate. And this concentration of wealth and income is widespread across the globe.

The seeming paradox raised here can be easily clarified by separating two distinct issues. One is the issue of income distribution within an integrated national economy the United States, Denmark, Brazil, China. And the second is the issue of extreme inequalities of per capita GDP across national economies the poverty of nations like Nigeria, Honduras, and Bangladesh compared to rich countries like Sweden, Germany, or Canada. Both are important issues; but they are different issues that should not be conflated. It is misleading to judge that global inequality is falling by looking only at the rank-ordered distribution of income across the world's 7 billion citizens. This decline follows from the moderate success achieved in the past fifteen years in ameliorating global poverty a Millenium Development Goal (link). But it is at least as relevant to base our answer to the question about the trend of global inequalities by looking at the average trend across the world's domestic economies; and this trend is unambiguously upward.

The rest of the article is excellent.

Related Stories

Global Income Inequality is Actually Falling 22 comments

Income inequality has surged as a political and economic issue, but the numbers don't show that inequality is rising from a global perspective. Yes, the problem has become more acute within most individual nations, yet income inequality for the world as a whole has been falling for most of the last 20 years. It's a fact that hasn't been noted often enough.

The finding comes from a recent investigation by Christoph Lakner, a consultant at the World Bank, and Branko Milanovic, senior scholar at the Luxembourg Income Study Center. And while such a framing may sound startling at first, it should be intuitive upon reflection. The economic surges of China, India and some other nations have been among the most egalitarian developments in history.

Of course, no one should use this observation as an excuse to stop helping the less fortunate. But it can help us see that higher income inequality is not always the most relevant problem, even for strict egalitarians. Policies on immigration and free trade, for example, sometimes increase inequality within a nation, yet can make the world a better place and often decrease inequality on the planet as a whole.

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  • (Score: 1, Insightful) by Anonymous Coward on Tuesday August 05 2014, @04:40PM

    by Anonymous Coward on Tuesday August 05 2014, @04:40PM (#77647)

    Cowen is a smart guy, but he's just as vulnerable to his own meme of "mood affiliation" [marginalrevolution.com] as anyone else.

    BTW, thanks to Dr Little for validating my first post. [soylentnews.org]

  • (Score: 2, Insightful) by redneckmother on Tuesday August 05 2014, @04:50PM

    by redneckmother (3597) on Tuesday August 05 2014, @04:50PM (#77652)

    To paraphrase Mark Twain -

    There are three kinds of lies: lies, damned lies, and statistics.

    I'm not saying that either analysis is correct or incorrect. All I know is that I'm tried of being "trickled on" since the '80s.

    --
    Mas cerveza por favor.
    • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @06:46PM

      by Anonymous Coward on Tuesday August 05 2014, @06:46PM (#77700)

      What, you don't like a nice golden shower?

    • (Score: 3, Informative) by FatPhil on Tuesday August 05 2014, @08:31PM

      by FatPhil (863) <pc-soylentNO@SPAMasdf.fi> on Tuesday August 05 2014, @08:31PM (#77746) Homepage
      This particular paradox is very similar to Simpson's Paradox: A1 is better than B1, A2 is better than B2, yet A1 and A2 together are worse than B1 and B2 together. Something that's true about parts, even all parts, individually isn't necessarily true about an aggregate, or the whole. Once you've trained yourself to be sensitive to when people are either grouping things together, or separating them out, for perhaps nefarious reasons, you're well on the way to being able to what's more likely to be a lie than a statistic. Suspicion is good.

      If you're new to Simpson's, and it intrigues you, it's a fun exercise to find the smallest example of it. I forget how small the samples can be, but you're looking at single figures, definitely.
      --
      Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves
  • (Score: 2, Interesting) by WillAdams on Tuesday August 05 2014, @04:57PM

    by WillAdams (1424) on Tuesday August 05 2014, @04:57PM (#77655)

    Wages, as a percentage of the U.S. GDP have been decreasing since 1972.

    Personal spending is the fundamental basis of the economy --- it would grow faster if individual working households had more to spend.

    They'd spend it more carefully and with greater concern for the future if the money were earned and not a government handout.

    • (Score: 4, Interesting) by metamonkey on Tuesday August 05 2014, @05:18PM

      by metamonkey (3174) on Tuesday August 05 2014, @05:18PM (#77665)

      That's the thing, incoming inequality in and of itself, regardless of cause or remedy, is bad. Not necessarily because "waaah it's unfair somebody makes more than me," but because if the poor and middle class have no money to spend, the economy (seen as a collection of transactions between willing actors) stagnates. It's hard to run a profitable shoe company when people can't afford shoes. A rich man's only got two feet. He's not going to make up the difference in what poor people would have spent on shoes. Really, nobody wins here. The poor man doesn't get shoes, the shoe company doesn't get revenue, and while the wealthy have more money to add to their piles, it's ultimately pointless because they can only spend so much, and investing in new business is marginal when there are few customers.

      This does not mean that the solution is for the workers of the world to unite, throw off their chains and seize the means of production. But capitalism needs a shot of socialism and protectionism or it's going to eat itself. We've sacrificed the health of the nation and its people on the alters of free markets and free trade. Import tariffs are needed to make it cheaper to make products in the US than China, bringing jobs back here. "But the cost of goods will rise!" No, Nike and Reebok will still compete on the price of shoes, just profits will be lower. Organized labor is needed for collective bargaining. True, unions run amok can destroy an industry, but capitalists run amok can destroy a nation. Right now all the power is with capital, and none with labor. There needs to be a balance between the two.

      Unfortunately, these are political problems and 40 years of brainwashing have the electorate convinced that all unions are crooked, protectionism is bad and free trade is good in and of itself. I don't see that changing. The snake will eat its tail.

      --
      Okay 3, 2, 1, let's jam.
      • (Score: 2) by buswolley on Tuesday August 05 2014, @05:53PM

        by buswolley (848) on Tuesday August 05 2014, @05:53PM (#77681)

        Income inequality also leads to (or is) political inequality. Large political inequalities has never done a nation well.

        --
        subicular junctures
      • (Score: 1, Interesting) by Anonymous Coward on Tuesday August 05 2014, @06:23PM

        by Anonymous Coward on Tuesday August 05 2014, @06:23PM (#77691)

        That's the thing, incoming inequality in and of itself, regardless of cause or remedy, is bad.

        No, it's not at all clear that it's necessarily, inherently bad. What about people who have children? Surely a little more income will help them care for their kids? Or do all children suddenly become independent with their own independent income, whether or not they're actually competent to administer that income? Do all people with kids get the kids' income? That turns out to be a huge motivation for having more kids since the cost of living isn't a linear function of headcount.

        What about people who make bad decisions? Do the people who buy a Rolls Royce instead of a Hyundai need a financial dumbass allowance?

        What about people with unequal financial resources at their disposal, independent of income? In your world of perfect egalitarianism with regard to income, Bill Gates would get the exact same number of dollars every day as the hobo begging for change on the corner. Does that still fit your outlook?

        Income equality also turns out to have downsides in terms of motivation. If Joe Sixpack discovers that he can make the same amount of money regardless of whether he cleans sewer lines or drinks beer and jerks off all day, it's going to be hard to motivate people to clean sewer lines. But we can't reward people who clean sewer lines, because all income inequality is always bad, right?

        Not necessarily because "waaah it's unfair somebody makes more than me," but because if the poor and middle class have no money to spend, the economy (seen as a collection of transactions between willing actors) stagnates.

        I am very, very far from flush, but I still managed to scrape together money for a refurbished laptop. It's not a question of fairness (which is a matter of perspective anyway - different people have different standards of fairness and a lot of people aren't motivated by it anyhow) and it's not because I'm not in the 1%. It's because income inequality does not imply destitution. In fact, you can have vast income inequality without anybody being destitute at all.

        It's hard to run a profitable shoe company when people can't afford shoes. A rich man's only got two feet. He's not going to make up the difference in what poor people would have spent on shoes. Really, nobody wins here. The poor man doesn't get shoes, the shoe company doesn't get revenue, and while the wealthy have more money to add to their piles, it's ultimately pointless because they can only spend so much, and investing in new business is marginal when there are few customers.

        If the outright purchase of necessary commodities (or, shall we say, highly practically desirable commodities) were the only function of money, you'd be completely right on this point. The trouble is that it is not. People in different financial situations not only make different consumption choices, but they also make different investment choices. A farmer might invest in a quarter million dollar combine harvester, whereas a suburban marketing consultant has absolutely no need for such a thing. The marketing consultant might put the same money (or the equivalent in payments) into a mutual fund, whereas the farmer can gain more from the combine harvester.

        Another question is what happens to deep investment when nobody actually has that kind of cash? Angel investors? Don't exist any more - or if they do, they can't actually make more money than anyone else off their investments, because that would be income inequality which is bad. Right?

        This does not mean that the solution is for the workers of the world to unite, throw off their chains and seize the means of production. But capitalism needs a shot of socialism and protectionism or it's going to eat itself. We've sacrificed the health of the nation and its people on the alters of free markets and free trade. Import tariffs are needed to make it cheaper to make products in the US than China, bringing jobs back here. "But the cost of goods will rise!" No, Nike and Reebok will still compete on the price of shoes, just profits will be lower. Organized labor is needed for collective bargaining. True, unions run amok can destroy an industry, but capitalists run amok can destroy a nation. Right now all the power is with capital, and none with labor. There needs to be a balance between the two.

        It's far from clear to me that the workers are hapless worms writhing under the jackbooted heels of capitalist exploiters in the USA. Has it been a nonstop beer, bratwurst and strippers party for the workers? Well, no. On the other hand, populist politics is alive and well on both sides of the aisle (Elizabeth Warren for Empress! Taxed Enough Already Party!) The NLRB is active, and arguably outright activist, so much so that quite a few of its decisions are headed for the courts. The big unions have become a purpose unto themselves, which is why they've largely lost the support of working people but quite a few co-ops and similar arrangements are coming about, especially in the medical field. It's not nearly as one-sided as you're painting it.

        Unfortunately, these are political problems and 40 years of brainwashing have the electorate convinced that all unions are crooked, protectionism is bad and free trade is good in and of itself. I don't see that changing. The snake will eat its tail.

        I have dealt with several unions over my career. I have only ever dealt with one in which there was not clear evidence of mafia activity, and that one was a tiny, marginal union actively wrapped up in marxist rhetoric. I didn't have to be brainwashed to conclude that just maybe the unions aren't devoted to my welfare. Your mileage may, of course, vary.

        Protectionism reduces options for workers worldwide. Mercantilism turned out to be a bad idea in the age of sail, and it's a bad idea in its modern form too. Wisconsin cheesemakers being told that they need to stop calling their feta cheese feta because the greeks will have a hissy fit doesn't help anybody in the big picture. The USA trying to export the implications of the DMCA to the rest of the world by treaty is also a bad idea.

        Capitalism doesn't seem so bad, actually. Maybe we could give it a try, for a change.

        • (Score: 2) by metamonkey on Tuesday August 05 2014, @06:44PM

          by metamonkey (3174) on Tuesday August 05 2014, @06:44PM (#77698)

          Perhaps I was unclear. I wasn't suggesting that everyone should make the same amount of money. When I said "income inequality is bad," what I meant was gross inequality and the vanishing of the middle class. When there are no more middle class people with enough money to buy iPhones, suddenly Apple won't be doing so well.

          --
          Okay 3, 2, 1, let's jam.
          • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @08:00PM

            by Anonymous Coward on Tuesday August 05 2014, @08:00PM (#77732)

            What happens when the bottom layer of society is making a comfortable living and can afford their iPhones, iPads, and iBlowMeAndMakeMeBreakfasts? Does it really matter then how breathtakingly opulent the way of life of the 0.001% is?

            • (Score: 0) by Anonymous Coward on Wednesday August 06 2014, @10:51AM

              by Anonymous Coward on Wednesday August 06 2014, @10:51AM (#77968)

              The bottom layer of society can not in fact afford their iPhones, iPads, etc.
              The bottom layer of society just goes heavily in debt to maintain THE ILLUSION that they can afford that shit.

              If you have no economic reserves, every small emergency (a kid being sick, car breaking down, etc) immediately transforms in a live-threatening catastrophe that might well make you and your family homeless.

              That situation takes away the option to 'just quit' when employers start heaping on ridiculous workloads, or start making ridiculous demands in terms of work hours, schedules and availility.
              Employers know this and massively and happily abuse that.

              The amount of people in that situation has increased massively since 2008 a quarter of the US now lives pay check to paycheck, 50% can't survive even 3 months without a paycheck. The median net assets of families has gone down over 40% since the crisis hit. 18% of households live doubled up in the US. In detroit hundreds of thousands of people cant afford basic utilities like water (bye bye flush toilets), etc. etc. etc.

              In other words the middle class is -for the most part- circling around the drain, getting closer and closer to ruin. The spoils are going to the rich.

              If things keep going the way they are, then pretty soon millions of people are going to have nothing left to loose, at which point I expect to see lots of riots, lynchings and openly violent class war.
              On the road we're taking the pitch forks _will_ come out.

              • (Score: 0) by Anonymous Coward on Thursday August 07 2014, @06:12AM

                by Anonymous Coward on Thursday August 07 2014, @06:12AM (#78325)

                The bottom layer of society can not in fact afford their iPhones, iPads, etc.
                The bottom layer of society just goes heavily in debt to maintain THE ILLUSION that they can afford that shit.

                True.

                Misses the point utterly.

                It's not about the fact that there are currently people who are destitute, or the fact that there are people who, regardless of what their income is, are living wildly beyond their means.

                It's about investigating the understanding of the prior post as to the implications of people having different incomes regardless of the absolute, not relative, positions of the people at the bottom. To put it another way: What if we're all comfortably off, does it matter if Gill Bates is making a crapton of money?

                snip lecture about the fact that some people are not financially secure

                In other words the middle class is -for the most part- circling around the drain, getting closer and closer to ruin. The spoils are going to the rich.

                If things keep going the way they are, then pretty soon millions of people are going to have nothing left to loose, at which point I expect to see lots of riots, lynchings and openly violent class war.
                On the road we're taking the pitch forks _will_ come out.

                Right. We get all that. That's been in every halfway major news organ for years - they all just blame different parties for the situation.

                We're talking about something rather different - the proposition that income egalitarianism has some particular negative value, and the conflation of that with some subset of the population being destitute, when in fact the one doesn't imply the other whatsoever. Metamonkey started with a bland statement to the effect that income inequality is bad, subsequently clarified to "gross inequality" without any subsequent clarification as to whether or not it matters when it's not "gross inequality" or when nobody is destitute.

                Hard core income egalitarians want to do away with inequitable distributions of capital, inequitable distributions of income, and in fact inequitable distributions of resources in general. I don't understand that to be metamonkey's position, so the question then becomes precisely what metamonkey is suggesting, other than a dearth of economic activities being generally bad.

                Well, yeah.

                But guess what happens when nobody can pay the going rate? The going rate drops. It has to drop. In the big picture it looks a lot like a monetary contraction or popular deleveraging, resulting in powerful deflationary pressures. Case in point: a lot of those third world people living on less than a dollar a day aren't actually starving. Granted, they aren't living it up either, but if the raw cost of living were more than they had, they would stop living, thus solving the problem by annihilation in a couple of months. Ergo, the cost of living is something they can afford, however uncomfortably.

                Does this make that outcome good? No. But it does lend context to this discussion which is far removed from the hand-wringing of raw absolutism.

          • (Score: 2) by frojack on Tuesday August 05 2014, @08:16PM

            by frojack (1554) on Tuesday August 05 2014, @08:16PM (#77742) Journal

            But the price of iPhones will come down.

            And given the size of Apple's war chest, I can't see how that would be a bad idea, nor can I understand you worrying about apple's gross (in every sense of the word) net worth, while at the same time bemoaning inequality of income.

            You want to cut all the tall poppies to prop up the tallest poppy? You sir, are internally conflicted.

            --
            No, you are mistaken. I've always had this sig.
            • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @10:15PM

              by Anonymous Coward on Tuesday August 05 2014, @10:15PM (#77795)

              What are you talking about? He doesn't care about Apple, he was just using them for an example. Few companies will be doing well when nobody has any spending money, not just Apple. And what's this about 'cutting tall poppies to prop up the tallest'? Where'd that come from? That's whats currently going on with the destruction of the middle class and not what the gp is advocating.

              Too many people here use their pedantry as an excuse to set up straw men to attack while avoiding the posters' point and intent. I suppose misrepresenting an argument or even changing the subject is a way to win a debate, for certain definitions of "win".

      • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @06:41PM

        by Anonymous Coward on Tuesday August 05 2014, @06:41PM (#77696)

        while the wealthy have more money to add to their piles, it's ultimately pointless

        ...unless the whole point is to make a pile that is larger than all others'.
        Observing these things, my impression is that this strata of people is trying to compensate for extremely small dicks.

        In addition, there's Koch, Adelson, Gates, et al who are control freaks and will throw a hissy fit when they can't have everything their way.

        The word "psychopaths" has been used in this thread.
        A more apt word is "sociopath".
        The people of this strata are devoid of empathy.
        The sociopaths would run over their own kin if those folks stood between them and a buck.
        (Look into the Kock brothers and note which ones got control of the bulk of the family fortune.
        Hint: Not Bill and Frederick. Yes, there are 4 Koch brothers.)

        -- gewg_

        • (Score: 2) by metamonkey on Tuesday August 05 2014, @06:47PM

          by metamonkey (3174) on Tuesday August 05 2014, @06:47PM (#77701)

          A psychopath and a sociopath are the same thing. Academics started using sociopath instead of psychopath because the public had the idea that all psychopaths were murders. They're not because they're rational and will rationally avoid punishment. In the absence of punishment, though, a socio/psychopath will kill or allow people to die if it achieves their goal. See Dick Cheney and Iraq war dead.

          --
          Okay 3, 2, 1, let's jam.
        • (Score: 2) by c0lo on Tuesday August 05 2014, @09:36PM

          by c0lo (156) Subscriber Badge on Tuesday August 05 2014, @09:36PM (#77761) Journal

          while the wealthy have more money to add to their piles, it's ultimately pointless
          ...unless the whole point is to make a pile that is larger than all others'.

          Capitalism shows lately accents of "I ain't rich enough if you aren't bare ass poor".

          --
          https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
        • (Score: 2) by khallow on Tuesday August 05 2014, @09:57PM

          by khallow (3766) Subscriber Badge on Tuesday August 05 2014, @09:57PM (#77781) Journal

          A more apt word is "human". There's no indication here that there's any unusual behavior at all. And "devoid of empathy" is a pretty standard leadership skill, namely, being able to make decisions in situations where there will be a loser no matter what you choose.

          • (Score: 2) by tathra on Tuesday August 05 2014, @10:26PM

            by tathra (3367) on Tuesday August 05 2014, @10:26PM (#77800)

            And "devoid of empathy" is a pretty standard leadership skill, namely, being able to make decisions in situations where there will be a loser no matter what you choose.

            being a heartless, sociopathic asshole is not the same as being able to make tough decisions. there [forbes.com] are [askmen.com] many [armystudyguide.com] ideas about what qualities a good leader should have, but sociopathy is never included in any of them. the fact that the system regularly selects sociopaths proves that its broken.

            • (Score: 2) by khallow on Tuesday August 05 2014, @10:35PM

              by khallow (3766) Subscriber Badge on Tuesday August 05 2014, @10:35PM (#77803) Journal

              But where's the evidence that these people are sociopaths and not just normal humans in positions of wealth, status, and authority?

              And no offense, but I do think there's a considerable mischaracterization of normal, often beneficial human traits and behaviors, such as the ability to make tough decisions and risk-taking, as sociopathy or psychopathy just because the person with the trait happens to have a lot of money.

              • (Score: 0) by Anonymous Coward on Wednesday August 06 2014, @01:30AM

                by Anonymous Coward on Wednesday August 06 2014, @01:30AM (#77855)

                No offense should be taken to my response to that: your naivety is surprising.

                There was a Slashdot article that linked to a story a number of years ago, that I'm unable to find through Google or Slashdot's search engine, that answers your call for evidence.

                The story is about the retirement speech of a leading US criminal psychologist, who listed all the traits of the sociopath/psychopath (lack of empathy, "reality bubbles," willingness to lie to others to get what they want for themselves, happy to sacrifice someone for their own desires) and asked the police officers who were attending the speech to name the group that these most applied to.

                If I recall correctly, "serial killers!" was called out by one officer. The speaker said "No."

                Someone else called out "rapists and murderers." Again, the speaker called out "No!"

                This went on for some time, until the cops gave up, and the speaker told them that the group these traits most applied to is highly paid businessmen, and politicians.

                • (Score: 2) by khallow on Wednesday August 06 2014, @07:56PM

                  by khallow (3766) Subscriber Badge on Wednesday August 06 2014, @07:56PM (#78181) Journal

                  No offense should be taken to my response to that: your naivety is surprising.

                  "Naivety" is such a ridiculously devalued word. It's not a synonym for someone who merely disagrees with you - especially someone expressing an even more cynical (or is that realistic?) viewpoint than your own.

          • (Score: 2) by sjames on Saturday August 09 2014, @05:57AM

            by sjames (2882) on Saturday August 09 2014, @05:57AM (#79240) Journal

            No. Sociopathy is a distinct psychological deficiency. There is nothing normal about it.

            Sociopathic traits may allow you to maneuver yourself into a leadership position and may even keep you there as long as the winds are fair but it doesn't make you a good leader. Actually, it makes you a terrible leader.

            Sociopathic officers in Vietnam were occasionally fragged by their own men. Does that sound like a good leader to you?

            • (Score: 2) by khallow on Saturday August 09 2014, @09:21PM

              by khallow (3766) Subscriber Badge on Saturday August 09 2014, @09:21PM (#79455) Journal

              Sociopathy is a distinct psychological deficiency.

              A distinct psychological deficiency which all humans share to varying degree, let us note.

              I just don't buy the pop psychology analysis of leadership. I think this is how people act when they're in positions of authority. Some learn how to curb the negative parts of these tendencies and others do not.

              • (Score: 2) by sjames on Saturday August 09 2014, @10:43PM

                by sjames (2882) on Saturday August 09 2014, @10:43PM (#79483) Journal
                A distinct psychological deficiency which all humans share to varying degree, let us note.

                Extraordinary claim! Evidence?

                The 'pop psychologists' have presented their evidence.

                • (Score: 2) by khallow on Saturday August 09 2014, @11:17PM

                  by khallow (3766) Subscriber Badge on Saturday August 09 2014, @11:17PM (#79489) Journal

                  Well, first what is a "sociopath"? Googling around, I see the first thing [reference.com] is that the subject experiences "anti-social" behavior. Second, that the subject exhibits a lack of moral responsibility or social conscience.

                  "Anti-social" [reference.com] in turn means that " of or pertaining to a pattern of behavior in which social norms and the rights of others are persistently violated." This is the psychological definition - not the various colloquial definitions which are irrelevant.

                  At this observe that many of the people in this thread state that the entire class of rich leaders exhibit the traits of sociopathy. That implies by definition (since we're speaking of the entire group and not just outlier members) that the traits in question are social norms and hence, on that basis not anti-social. Second, as to "rights" of others being "persistently violated", it's worth remembering that most such others are voluntary employees paid to subject themselves to the behaviors of the person in question. So I don't see that these traits are anti-social. Also, it's worth noting that running a large, successful business requires a considerable degree of social adeptness.

                  Moving on, the subjects should exhibit a lack of moral responsibility and social conscience. Here, we have several examples of rich people with such things. The AC who originally bandied around "psychopathy" mentioned specifically, the Koch brothers, Bill Gates, and Sheldon Adelson. All exhibit an awareness of moral responsibility. The Koch brothers are a notorious sponsor of a variety of libertarian and conservative causes, including being some of the prime sponsors of the climate "skeptic" movement. Bill Gates famously sponsors a variety of initiatives for improving the world (particularly, work to fight a number of third world diseases and parasites). Adelson sponsors a variety of Jewish and philanthropic causes. Sure, these causes directly or indirectly benefit them or further the ideologies they care about. But that's true in general. People are pretty lousy at separating personal benefit from morality. I see moral responsibility and social conscience exhibited which is another strike against sociopathy.

                  In other words, I don't see anything to indicate that a psychological definition of sociopath applies here.

                  • (Score: 2) by sjames on Sunday August 10 2014, @04:14AM

                    by sjames (2882) on Sunday August 10 2014, @04:14AM (#79551) Journal

                    If it's just 1%, it's not exactly the norm, now is it? If you then consider that the term "1%" in this context more properly refers to 0.1% of the population, you are firmly outside of 'the norm'.

                    It is indeed very possible to be anti-social while being socially adept. That is a decent description of a con-man. Other things you see in such people include losing a game or two before they clean you out, doing conspicuous good deeds so they can rob you blind as you pat their back, etc. Big surprise, the Koch brothers spend money trying to silence people who demand that they behave more responsibly. Baby Doc paid people who were doing his bidding too, that certainly doesn't make him a philanthropist or in any way aware of social responsibility.

                    Bill Gates got his start stealing computer time from Harvard and failing to deliver his product in a timely manner. he then built Microsoft, a three time loser except he won anyway because of money. I don't know enough about Adelson to comment.

                    • (Score: 2) by khallow on Sunday August 10 2014, @06:33AM

                      by khallow (3766) Subscriber Badge on Sunday August 10 2014, @06:33AM (#79579) Journal

                      If it's just 1%, it's not exactly the norm, now is it?

                      The population wasn't chosen because of its psychological characteristics, but rather because they had a lot of wealth.
                       
                       

                      Bill Gates got his start stealing computer time from Harvard and failing to deliver his product in a timely manner. he then built Microsoft, a three time loser except he won anyway because of money. I don't know enough about Adelson to comment.

                      In other words, normal human stuff. And it worked for him. When what you consider is bad behavior is amply reworded, then it should be no surprise that you see normal people engage in bad behavior. And Gates is a great example here of why you shouldn't discount someone just because they failed in the past.

                      • (Score: 2) by sjames on Sunday August 10 2014, @08:50AM

                        by sjames (2882) on Sunday August 10 2014, @08:50AM (#79608) Journal
                        The population wasn't chosen because of its psychological characteristics, but rather because they had a lot of wealth.

                        And a suspiciously close correlation with traits associated with sociopathy.

                        Most normal humans don't commit serial felonies while hiding behind a pile of cash even when they see it amply rewarded. If you don't know that, you might should re-evaluate your circle of friends before one of them slips the knife in your back.

                        • (Score: 2) by khallow on Sunday August 10 2014, @11:28AM

                          by khallow (3766) Subscriber Badge on Sunday August 10 2014, @11:28AM (#79635) Journal

                          And a suspiciously close correlation with traits associated with sociopathy.

                          Alleged correlation. Where's the control population of rich normal people which you're comparing them to?

                          Most normal humans don't commit serial felonies while hiding behind a pile of cash even when they see it amply rewarded.

                          I think that statement is just wrong. Corrupt societies are excellent counterexamples. And if you're never going to get caught, it's not a felony.

      • (Score: 1) by frojack on Tuesday August 05 2014, @08:09PM

        by frojack (1554) on Tuesday August 05 2014, @08:09PM (#77737) Journal

        That's the thing, incoming inequality in and of itself, regardless of cause or remedy, is bad.

        No, it isn't.

        --
        No, you are mistaken. I've always had this sig.
      • (Score: 2) by choose another one on Tuesday August 05 2014, @08:25PM

        by choose another one (515) Subscriber Badge on Tuesday August 05 2014, @08:25PM (#77744)

        It's hard to run a profitable shoe company when people can't afford shoes. A rich man's only got two feet.

        So has his wife/girlfriend(s) - but she probably has lots of pairs of shoes. Also, not all shoes are the same price.

        Jimmy Choo doesn't need to sell many shoes to many rich people to make a lot of money, and in fact if he sold more shoes to poorer people he would probably make less money overall. Economics doesn't always work the obvious way, especially when selling to the rich.

        • (Score: 3, Insightful) by c0lo on Tuesday August 05 2014, @09:40PM

          by c0lo (156) Subscriber Badge on Tuesday August 05 2014, @09:40PM (#77767) Journal

          Jimmy Choo doesn't need to sell many shoes to many rich people to make a lot of money, and in fact if he sold more shoes to poorer people he would probably make less money overall. Economics doesn't always work the obvious way, especially when selling to the rich.

          If all the shoe production comes down to Jimmy Choo and everybody (except a hundred or so) go barefoot, that's no longer a functioning economy.

          --
          https://www.youtube.com/watch?v=aoFiw2jMy-0 https://soylentnews.org/~MichaelDavidCrawford
  • (Score: 2) by VLM on Tuesday August 05 2014, @05:07PM

    by VLM (445) Subscriber Badge on Tuesday August 05 2014, @05:07PM (#77659)

    The TLDR is if you have a small number of people living in wealthy countries and lots in dirt poor countries, then making the poorest of the poor a little richer, just a little, means whatever you do to the high end incomes, even if all the ratios increase, the global average will likely decrease because of the low end increase.

    The guy has weird political views that are kind of backward WRT cause and effect:

    "undermines the perceived legitimacy of our economic system. Widening inequalities have given rise to a widespread perception that these growing inequalities are unfair and unjustified. This is a political problem of the first magnitude. Our democracy depends on a shared conviction of the basic fairness of our institutions."

    The way it actually works is democracy is a PR technique to fool the masses into complacency, thinking, falsely, that they have any input into the system, when they don't. When you screw them over enough that allowing them to pick the "right" rich white guy from Yale or the "correct" wall street bribe taker won't pacify them, then you got big problems and no amount of "drill baby drill" or "I feel your pain" BS is going to calm them down. And that's pretty much where we're at now. Whoops. Well lets see whats proposed to fix that... whats the modern American motto, we may as well print this on our money, "F you, I've got mine"... hmm yeah this could be a problem yup. The folks in charge see a problem and literally have no idea what to do about it other than the usual setting up a paranoid police state blather that usually only gains a couple years, maybe decades, for the regime.

    The trick with a democracy is to keep the level of outrage low enough that selecting one of two pre-selected almost identical candidates keeps them pacified. If you outrage them too much, merely picking one stuffed suit over another isn't going to calm them, no matter how much money you spend on media advertising trying to convince them otherwise.

    • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @05:17PM

      by Anonymous Coward on Tuesday August 05 2014, @05:17PM (#77664)

      The trick with a democracy is to keep the level of outrage low enough that selecting one of two pre-selected almost identical candidates keeps them pacified.

      Or, you know, not have an ogliarchy.

      • (Score: 2) by VLM on Tuesday August 05 2014, @06:00PM

        by VLM (445) Subscriber Badge on Tuesday August 05 2014, @06:00PM (#77689)

        "Or, you know, not have an ogliarchy."

        But then how would the people in control be guaranteed absolute power, if the people had any input on the decision?

        Better off having two candidates identical WRT all economic and political issues and let the people select which PR lie campaign sounded more convincing.

        • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @06:49PM

          by Anonymous Coward on Tuesday August 05 2014, @06:49PM (#77705)

          But then how would the people in control be guaranteed absolute power, if the people had any input on the decision?

          The people in control should be the people; thats kind of the definition of democracy. You're describing an ogliarchy. Its not your fault; like when people say "communism" when they mean "soviet communism" and "capitalism" when they mean "crony capitalism", both of which are about as far from their ideals as they can get, you're saying "democracy" when you mean "ogliarchy" because thats the only execution of the concept you've ever seen.

    • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @05:27PM

      by Anonymous Coward on Tuesday August 05 2014, @05:27PM (#77668)

      > The way it actually works is democracy is a PR technique to fool the masses into complacency

      The idea that it is binary is a fallacy. If anything that sort of black-and-white thinking feeds the problem by encouraging absolutism which creates paranoid police states on one side and violent revolutions on the other.

    • (Score: 3, Interesting) by metamonkey on Tuesday August 05 2014, @05:33PM

      by metamonkey (3174) on Tuesday August 05 2014, @05:33PM (#77673)

      The trick with a democracy is to keep the level of outrage low enough that selecting one of two pre-selected almost identical candidates keeps them pacified. If you outrage them too much, merely picking one stuffed suit over another isn't going to calm them, no matter how much money you spend on media advertising trying to convince them otherwise.

      That sounds good, but it would require capitalists to share profits with labor, when, as you said, "F you, I've got mine." Publicly traded corporations are psychopathic. The board of directors has a duty to maximize shareholder value, and you maximize shareholder value by posting short-term profits, regardless of social cost. There will be no agreement with other capitalists to share the wealth, because there cannot be when the incentive structure is as it is. Let the other corporations sacrifice their stock value "for the public good." F you, I've got mine.

      The result is inevitable. The system will collapse. This is just a historical reality. In his anacyclosis Polybius told us how this works two thousand years ago, the cycle of virtuous governments and their degenerate offspring and then their replacements. Anarchy (dark ages) is quelled by a strong ruler who unites or conquers loose feudal states into a monarchy (Charlemagne, Bill the Conq.). The monarch's kids get greedy, amassing wealth and power at the expense of their subjects degenerating into despotism (George 3). The wealthy subjects overthrow the despot and establish an aristocracy (G.W., T.J.). Again, greed, collusion, perversions of the system result in the degenerate aristocracy, an oligarchy. The public can eventually take no more corruption and hardship and overthrows the oligarchy, forming a democracy. That's where we're at now. Next, demagogues splinter the democracy, resulting in anarchy, and the cycle starts all over.

      There are patterns and cycles to history. Strauss-Howe generational theory is just a retelling of the ancient Chinese proverb that wealth does not survive three generations. Every 80 years a crisis will arise, driven by generational conflict. 1776, 1861, 1941, 2021?

      It's going to be an interesting next decade or two.

      --
      Okay 3, 2, 1, let's jam.
      • (Score: 2) by VLM on Tuesday August 05 2014, @06:02PM

        by VLM (445) Subscriber Badge on Tuesday August 05 2014, @06:02PM (#77690)

        I found reading Gibbon's decline and fall of the roman empire to be a useful application of time.

        Interesting stuff applicable to today.

      • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @06:58PM

        by Anonymous Coward on Tuesday August 05 2014, @06:58PM (#77708)

        The board of directors has a duty to maximize shareholder value, and you maximize shareholder value by posting short-term profits, regardless of social cost.

        No, it is not. [salon.com] That properly explains what they're doing and how our corporate overlords see things, but its not what they're supposed to do. A corporation's duty is to execute its charter; if and only if "maximize short-term profits at all costs" is in their charter is it their duty to do so. What you're spouting is mere ideology.

        • (Score: 2) by choose another one on Tuesday August 05 2014, @09:38PM

          by choose another one (515) Subscriber Badge on Tuesday August 05 2014, @09:38PM (#77763)

          Depends where you are. Where I am a director, there _is_ a _statutory_ duty to act to ensure the success of the company, where success is defined in terms of shareholder (member) value.

          http://www.iod.com/guidance/briefings/cgbis-directors-duties-and-responsibilities#duties [iod.com]

          That doesn't change that maximising shareholder value in the short term at the expense of long term value is actually not in the interests of the company or its success. The problem is that directors have become increasingly short-term post holders in the modern business world, and, like fixed term politicians, they start to act to maximise "success within my term" rather than long term success.

          • (Score: 2) by sjames on Saturday August 09 2014, @06:48AM

            by sjames (2882) on Saturday August 09 2014, @06:48AM (#79246) Journal

            I don't see anything there about short term. If the director can articulate any reason at all why leaving some short term profit on the table increases the likelihood that the company will still exist in 10 years, he has met his duty. That can include avoiding villagers with torches and pitchforks type problems.

    • (Score: 2, Informative) by Anonymous Coward on Tuesday August 05 2014, @06:44PM

      by Anonymous Coward on Tuesday August 05 2014, @06:44PM (#77697)

      The way it actually works is democracy is a PR technique to fool the masses into complacency, thinking, falsely, that they have any input into the system, when they don't.

      No, this is how the poor and powerless cynically perceive democracy to work. The fact that you're spouting it as the cause of income inequality means that you are already cowed into the helpless, "Lesser of two lizards," class. It means your democracy is already broken.

      People did, in fact, used to matter in elections, and candidates did differ on significant issues. If Alf Landon had been elected in 1936, he would have unwound Social Security and many of the New Deal policies. The 1940 election was basically a referendum on going to war (although it only held until Pearl Harbor). The erosion of main street politics in favor of Wall Street and oligarch politics has been slow and steady, with only the occasional, Citizens United-scale lurch to the right. Capitalism tends to increase income inequality and a functional democracy is a good tool for preventing the abuses intrinsic to capitalism.

      Political and economic reform comes from the bourgeois. Strip away the middle class, and you lose the base of reformers, leaving only the elite who benefit from the current system and the poor who think they have no effective voice in the system.

      • (Score: 0) by Anonymous Coward on Tuesday August 05 2014, @07:53PM

        by Anonymous Coward on Tuesday August 05 2014, @07:53PM (#77728)

        No, this is how the poor and powerless cynically perceive democracy to work. The fact that you're spouting it as the cause of income inequality means that you are already cowed into the helpless, "Lesser of two lizards," class. It means your democracy is already broken.

        I voted. A couple of times, in a couple of elections. Then I sat down and I thought about the whole experience.

        Voting is a huge, lossy compression system for extracting policy recommendations. If you look at the even halfway plausible candidates in a national presidential election (to take an example with which most people are fairly familiar) including Green, Constitution, Reform, Libertarian and a few other candidates with no currently realistic prospects of success, the actual outcome amounts to a choice from eight (or fewer) alternatives. That is three bits of information. From an electorate of, oh, let's go crazy and call it 100 million people, each of whom is providing their own three bits of information, you're reducing 2^28 bits of data (ballpark) to 3 bits.

        That's not a lot of input per person.

        I also thought about the relative value of one's vote. I could have been standing in line between the modern Aristotle and Plato, but just as easily next to a guy who think that dentists installed a radio in his teeth through which Che Guevara tells him what to do. And yet everyone gets an equal vote. If it's all about opinions, and everyone's opinions have equal merit, then that's a great theory but in the real world I go to a plumber to get my toilet fixed and to a doctor to get my bowels fixed, not the other way around. Running a modern country is a complicated business, and there's a lot to know. Geography, history, economics, all sorts of stuff and yet the fact is that the bulk of people are not intellectually equipped to do serious tertiary academic work. It's just a psychological, demographic fact - the average human being's intellectual level is not well suited to handling the upper reaches of Bloom's Taxonomy.

        So where does that leave the vote? My vote? I asked myself what would have happened if I had not participated. It turns out that my individual vote is below the noise level in terms of counting errors. A statistician would have ignored the difference. At best, participation rates suggest what percentage of the population think that the system is even worth a symbolic gesture - call it a degree of confidence in the system as a whole.

        Funnily enough, that appears to be waning.

        Bear in mind all this so far assumes that every effort is made to count votes honestly (however imperfect the system) and that every vote is duly considered as grounds for policy considerations. In actual fact that doesn't even closely approximate the reality of the situation. Obama was going to change everything! Shake up the world! Undo all the follies of the old, horrible Bush regime! That's what people voted for: Hope and Change! And then ... on balance, most of the old Bush policies largely continued, with a few details tweaked around the edges. But we got Obamacare! Except that it turns out to have been sold with lies, bought with backroom deals, and measurably worse for a lot of people who are now forced to buy insurance they would never have chosen for themselves, subsidies or no. Is that what all those bright-eyed students and activists wanted? I got five bucks that says it isn't, and the poll figures which tell me their disenchantment rates are rising.

        People did, in fact, used to matter in elections, and candidates did differ on significant issues. If Alf Landon had been elected in 1936, he would have unwound Social Security and many of the New Deal policies. The 1940 election was basically a referendum on going to war (although it only held until Pearl Harbor).

        Arguably they still differ on major issues. Or at least, their electoral paperwork says they do. A vote for McCain or Romney instead of Obama would presumably have sent some pretty substantial signals on the USA's role in Afghanistan and Iraq, for example. That's not really the point. The point is that the net difference of you or I getting up one November day, taking off the day from work and standing in line for hours in the rain or snow to make a three bit data entry is, on an individual basis, vanishingly small. What the vote really measures is the broad opinion of people who are still invested in the system as a sort of participatory exercise - a proportion which is dropping and has been, as a broad trend, for decades.

        The erosion of main street politics in favor of Wall Street and oligarch politics has been slow and steady, with only the occasional, Citizens United-scale lurch to the right. Capitalism tends to increase income inequality and a functional democracy is a good tool for preventing the abuses intrinsic to capitalism.

        Machine politics has been alive and well since before you were born, and quite likely before your grandparents were born. On that time scale there have been lots of lurches to the right, the left, and along other axes. FDR's New Deal had a lot in common with Mussolini's policies in Italy (just broadly more competently administered) so does that make him a leftist or a rightist? The civil rights era was largely pushed through by republican politicians before the democrats and republicans switched sides on minority rights. Left or right? Was that a functional democracy? Was it functional when FDR's administration translated the tenth amendment into effective plenary federal power over commercial activities?

        I don't pretend to know what your answers might be, but I do know that democracy isn't what people claim it is, and I'm pretty sure that its relationship with capitalism is a lot more fraught than you're describing here.

        Political and economic reform comes from the bourgeois. Strip away the middle class, and you lose the base of reformers, leaving only the elite who benefit from the current system and the poor who think they have no effective voice in the system.

        "Bourgeois" doesn't actually mean "middle class". It's more complex than that. There's a difference between the grand and petty bourgeoisie, and the boundaries between population groups are fuzzy. It would probably be wiser to work in terms of divisions which better describe modern society than to dredge up nineteenth century terms which no longer really apply.

        • (Score: 2) by VLM on Tuesday August 05 2014, @08:18PM

          by VLM (445) Subscriber Badge on Tuesday August 05 2014, @08:18PM (#77743)

          Hey AC I bet you would enjoy

          http://archive.lewrockwell.com/rozeff/rozeff224.html [lewrockwell.com]

          I'm a big fan of:

          "I don't wish to endorse the system that I think is no good."

          "I do not wish to endorse a system that has produced and continues to produce what I think are pragmatically bad results."

          "It does not mean selecting a candidate who then works within a system not of your choice."

    • (Score: 2) by choose another one on Tuesday August 05 2014, @07:57PM

      by choose another one (515) Subscriber Badge on Tuesday August 05 2014, @07:57PM (#77730)

      The TLDR is if you have a small number of people living in wealthy countries and lots in dirt poor countries, then making the poorest of the poor a little richer, just a little, means whatever you do to the high end incomes, even if all the ratios increase, the global average will likely decrease because of the low end increase.
      The guy has weird political views that are kind of backward WRT cause and effect:

      Yep. One article says "global inequality is decreasing, that's good" the other says "but local inequality is increasing, so it is bad".

      Both seem to miss that reducing the global inequality by development is going to have the effect of increasing local inequality. We got all upset that the un-developed world were either subsistence farming with zero income or earning less in a month than first-worlders earn in an hour. So lets get those places to become the developing world, can't go wrong...

      So what happens is:
      The first-world jobs that can be are exported to the, now more educated and capable, developing world
      The little guys in the developing world earn a bit more
      The business owners there earn a _lot_ more because they make a margin over a lot of workers who are earning more (local inequality increase)
      Oh, and in general they haven't developed their corruption out yet, so again the rich and powerful get richer
      Meanwhile the little guys in the first world earn less to compete (or are out of a job entirely)
      But the big guys in the first world simply become importers/outsourcers, get the job done for less, and make even more money (and local inequality increases, again)

      • (Score: 2) by Magic Oddball on Wednesday August 06 2014, @11:55AM

        by Magic Oddball (3847) on Wednesday August 06 2014, @11:55AM (#77986) Journal

        No -- that's how it played out because politicians became beholden to corporations. There were two totally different reactions to Third World (Developing) nations in the First World:

        a) Most individuals: "Aw, they just need education/training and maybe seed funds to be able to invent their own nifty stuff to make & sell, then they can live like us!"

        b) Selfish/Corporate: "Ha, those chumps would take $0.5/day! If I could move all of my basic perform-by-rote jobs there and quit employing people in my own country, I can lower my costs and make more money!"

        The 'First World' nations took route "a" when developing into what they are now: they required all citizens be given a basic education (math, basic science, reading, writing, simple history & geography). That moved us from a society with very rich people employing very poor ones for manual labor, to one where there were rich, professional, white-collar, trained blue-collar, poor, then poverty, with each a good chance to move up. Early into that stage, laws were passed ensuring the blue-collar employees couldn't be grossly overworked or endangered, had to be fairly compensated and be allowed to bargain collectively in order to keep employers in line.

        *That* was what should have happened with the 'Third World' nations. Had all politicians followed the lead of the European ones that refused to allow mass export of jobs to the detriment of their own citizens, and the Third World been given just the kind of assistance they actually needed (education, farming tips, improved sanitation etc.) they might be our peers now.

        Instead, our corporations convinced government to let them export jobs there with no financial penalty. Labor laws hadn't been instituted there, so these new jobs were highly exploitative, enough to avoid creating the kind of socioeconomic mobility we used to have. Whenever labor prices started to increase or a cheaper option was found, the corporations simply moved the jobs, and since the corporations had bought much of the land & farms, in many areas people found themselves jobless without the old resources to survive on.

        • (Score: 2) by choose another one on Wednesday August 06 2014, @06:09PM

          by choose another one (515) Subscriber Badge on Wednesday August 06 2014, @06:09PM (#78135)

          The 'First World' nations took route "a" when developing into what they are now: they required all citizens be given a basic education (math, basic science, reading, writing, simple history & geography). That moved us from a society with very rich people employing very poor ones for manual labor, to one where there were rich, professional, white-collar, trained blue-collar, poor, then poverty, with each a good chance to move up. Early into that stage, laws were passed ensuring the blue-collar employees couldn't be grossly overworked or endangered, had to be fairly compensated and be allowed to bargain collectively in order to keep employers in line.

          Industrial revolution, with the massive per capita gdp increase that went along with it, was, in UK, about 1760 to 1830. First factory act in UK was I think 1819, only banned employing children under 9yrs age, no enforcement or inspections until 1933. Universal education provision didn't have a legal framework until 1870, and mandatory education and universal provision didn't happen until the 20th century. Minimum wage arrived in 1998.

          Even if it takes the third world 100yrs to go from industrialisation to full education provision and worker rights, they are still doing better than we did.

    • (Score: 3, Informative) by FatPhil on Tuesday August 05 2014, @08:44PM

      by FatPhil (863) <pc-soylentNO@SPAMasdf.fi> on Tuesday August 05 2014, @08:44PM (#77749) Homepage
      For a TLDR, I prefer a simple numerical example:

      In the past the two residents of Pooristan earnt 1 and 2, but the two residents of Richland earnt 20 and 50.
      Now, the two residents of Pooristan earn 2 and 5, and the two residents of Richland earn 15 and 45.

      The Pooristanis have gone from a 2:1 ratio to a 2.5:1 ratio - greater disparity.
      The Richlandians have gone from a 2.5:1 ratio to a 3:1 ratio - greater disparity.

      Yet the population as a whole has less disparity, despite every individual country having greater disparity.
      --
      Great minds discuss ideas; average minds discuss events; small minds discuss people; the smallest discuss themselves