tag:blogger.com,1999:blog-6058072377999486184.post314597424475352088..comments2023-12-29T18:13:21.495-06:00Comments on pink scare: Is the Wealth of the Rich Legitimate? Part 1Unknownnoreply@blogger.comBlogger7125tag:blogger.com,1999:blog-6058072377999486184.post-84643867845408526772012-03-12T14:21:41.796-05:002012-03-12T14:21:41.796-05:00People throughout history have exploited other peo...People throughout history have exploited other people. Their exploiting will stop soon -- they'll be 6 ft. under before they realize it!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-6058072377999486184.post-16469382933878614122011-11-15T19:10:46.176-06:002011-11-15T19:10:46.176-06:00For me, the key Marxist insight here is that what ...For me, the key Marxist insight here is that what matters first is production, not distribution or consumption. That is to say, we have to restructure production relations if we're going to get to the root of the matter. Concretely, that means that the problem isn't, at bottom, one of how much to tax, or how much wealth people deserve. The fundamental problem is the private ownership of the means of production by a small class. As Marx put it in the Critique of the Gotha Program: <br /><br />"Any distribution whatever of the means of consumption is only a consequence of the distribution of the conditions of production themselves. The latter distribution, however, is a feature of the mode of production itself. The capitalist mode of production, for example, rests on the fact that the material conditions of production are in the hands of non-workers in the form of property in capital and land, while the masses are only owners of the personal condition of production, of labor power. If the elements of production are so distributed, then the present-day distribution of the means of consumption results automatically. If the material conditions of production are the co-operative property of the workers themselves, then there likewise results a distribution of the means of consumption different from the present one. Vulgar socialism has taken over from the bourgeois economists the consideration and treatment of distribution as independent of the mode of production and hence the presentation of socialism as turning principally on distribution."<br /><br />Of course, there are still important questions that remain. After production is brought under the democratic control of the community, how should we determine the distribution of certain socially produced goods? My view would be that it depends on the good. Citizens of a socialist society would be able to determine --through collective self-governance-- how to distribute different social goods. Human beings, living in communities together, create, produce and distribute amongst one another all kinds of "goods" (e.g. respect, recognition, honor, rights, work, money, commodities, office, education, medical care, etc.). It should be up to citizens to determine how, given the social meaning that these goods have, they should be distributed. Letting the capitalist market--dominated as it is by the drive to accumulate profit--forecloses the possibility of allowing citizens to determine this collectively. <br /><br />A lot of the points you raise about Williams have to do with risk-taking and reward for innovation, so I'd be curious to know what you think of my most recent post.thttps://www.blogger.com/profile/05268192967377248928noreply@blogger.comtag:blogger.com,1999:blog-6058072377999486184.post-57162424926535375882011-11-14T20:17:53.654-06:002011-11-14T20:17:53.654-06:00First off, I agree that most defenders of capitali...First off, I agree that most defenders of capitalism err when they say that in a market system wealth earned is a direct result of productive contributions. In reality, great fortunes are usually earned by some combination of productive output, risk taking/luck, and the capturing/creation of a natural or artificial monopoly.<br /><br />Also, obviously those who inherit money do not in a cosmic sense "deserve" that money. They did not accumulate that wealth via productive enterprise. But if you wish to allow people to spend their money as they see fit, some people will give their money to the undeserving. In such a situation the wealth of the underserving would be "legitimate" but not "deserved."<br /><br />Let's drop the word "deserving" (which is too subjective) and the word "legitimate" (which is too much of a synonym for legal, which thus restricts us to the status quo) and use the word "proper". We'll define that someone's wealth is "proper" if he or she would have earned a similar amount of wealth in a well designed, reasonable, optimal (but not utopian) economic system. So for instance, in my opinion, the wealth of the former CEO of Bear Stearns is improper because he earned his fortune by exploiting a "heads-I-win, tails-you-lose" game that was built into a very dysfunctional financial system.<br /><br />I think the wealth of Evan Williams is proper. A well designed, reasonable economic system needs to allow people to reap the rewards of taking risks. A reasonable way of doing that is by saying, "If you write computer source code and develop an internet property (blogger.com), you have ownership over that property, and reap a substantial percentage of the rents and profits from that property." So if Evan Williams forgoes $100k+ in salary to take a risk creating an innovative web publishing platform, and it turns out that other people find his product valuable, I think he should be able to reap the rents of selling access to the intellectual property he created. If he earns millions, those earnings are proper. <br /><br />It is also proper that the government tax some portion of this wealth and broadly redistribute it. Some portion of Evan Williams earnings come by capturing a scarce resource (the market opportunity for blogging software). Furthermore his earnings are only made possible by a broader technological, social and legal system. He stands on the shoulders of giants.<br /><br />So it is proper that tax rates are high enough so that wealth is broadly distributed. Those who are lucky enough to capture winner-take-all market opportunities should not keep all the wealth. But the rates should be low enough so that entrepreneurs and investors still have an incentive to take big risks.<br /><br />What kind of tax rate should that be? I don't know. There is no good, objective way to answer to the question. If I was King and had to choose some tax level, I would probably go with: No corporate taxes - just tax dividends and capital gains. The first $500k of lifetime capital gains and dividends would be tax free. The next $5 million of life time capital gains and dividend income would be taxed at 33%. The next $5 to $40 million would be taxed at 40%, and everything over $40 million would be taxed at 60%.<br /><br />In the above system, which I would consider reasonable and close to optimal, Evan Williams would still make millions. Thus I consider his wealth "proper".<br /><br />I look forward to your future posts on risk taking and entitlement to property.Devin Finbarrhttp://intellectual-detox.comnoreply@blogger.comtag:blogger.com,1999:blog-6058072377999486184.post-25820258872544868292011-11-14T10:57:24.834-06:002011-11-14T10:57:24.834-06:00@Rocky Rococo
What you're describing strikes ...@Rocky Rococo<br /><br />What you're describing strikes me as similar to what the Frankfurt School Marxists called the "Culture Industry". I agree with you that the corporate media, especially when looked at in terms of its cumulative effects of long periods of time, tends to preserve (rather than challenge) the status quo. Moreover, it is true that cultural production (TV, film, music, magazines, etc.) tends to have a similar function. But it isn't uniformly bad --there are cracks and contradictions everywhere. And where there are cracks and contradictions there is space for critical thinking. <br /><br />Still, although the media and the Culture Industry have conservative effects on consciousness, I think the OCcupy movement has shattered the assumption that Americans are too deluded to ever fight back. Hundreds of thousands of people --in hundreds of different cities-- are participating in the movement because they are convinced that our political and economic system is dominated by the 1% (despite all the lies they've been told by teachers, the media and movies). There is a huge radicalization going on right now and people are asking questions like "is capitalism the best we can do?". The task of radicals is to participate in and deepen this radicalization. So, while I see what you're saying, I don't think a general attitude of pessimism about social change makes sense given what's going on in the world right now.thttps://www.blogger.com/profile/05268192967377248928noreply@blogger.comtag:blogger.com,1999:blog-6058072377999486184.post-15910794823948770242011-11-14T10:27:28.679-06:002011-11-14T10:27:28.679-06:00@Devin Finbarr
Much of the Evan Williams example...@Devin Finbarr <br /><br />Much of the Evan Williams example has to do with reward for having taken risks, but I didn't address that in the post (I'll address that in an upcoming post since it's a separate argument from the one I deal with in the post, i.e. "x deserves her wealth because it reflects her productive contribution"). <br /><br />Here are a couple of thoughts. First let me clarify a bit what the argument in the post attempts to show. Defenders of capitalism often claim that the distribution of wealth it generates is legitimate because market distributions reflect productive contributions. I refuted this argument by showing that capitalists --those who own the means of production-- need not do anything productive at all to earn vast sums. Of course, many capitalists do do some work, whether its planning or co-ordinating or whatever (although most pay others to do this for them). But the point is this: even those capitalists who are hard-working entrepreneurs don't get paid according to their productive contributions. They get more --because the lion's share of capitalist's income is derived from their ownership of a scarce factor of production. <br /><br />There's more to say here. In general, deservingness has nothing to do with how the market works. The market responds to supply and effective demand. Imagine that I sell jugs of water during a drought and make a handsome sum. Do I deserve these earnings in the same way that I deserve a trophy for winning a race? And why is the particular price I get for the jugs what I deserve in this case? Suppose, for example, that the drought ends and price I earn per jug of water sold decreases substantially. Am I now less deserving than before? The point is that market distributions don't reflect who deserves what. It reflects who is legally entitled to what based on the exchange of ownership titles. That is different from desert. If a stranger randomly gives me her house as a gift, I may then legally own the house but do I deserve it? Or imagine that I inherit a vast sum from a Grandparent. I am legally entitled to it, given the rules of the market, but do I deserve it? <br /><br />So, take the Evan Williams case. He clearly did some innovative things that have been helpful for a lot of people. But why, then, should we conclude that he deserves a particular sum of money for having done it? Perhaps, given certain market conditions, he can command some particular figure (and, given some other set of conditions, perhaps he could command another). But that's not the same as deserving it. In fact, I don't see where deservingness of money enters into it. Think of people who develop open-source software (an incredible service that I reap the benefits of every day!). Are they being wronged because they haven't yet been given some sum of cash (how much? who decides?) that they can be said to deserve? And there's another complication here, which has to do with perpetual rewards. Suppose I come up with some great innovative technology that reflects a huge contribution to society. Is it just for me to be rewarded (again and again) for something I did in the past? It makes more sense to say that the inventor is legally entitled to her royalties (not that she deserves them). I haven't yet said anything about entitlement to property (on the basis of voluntary exchange) --I want to write about that in a future post.thttps://www.blogger.com/profile/05268192967377248928noreply@blogger.comtag:blogger.com,1999:blog-6058072377999486184.post-9149814672390987032011-11-13T22:43:16.151-06:002011-11-13T22:43:16.151-06:00There is I believe a third major component of the ...There is I believe a third major component of the ability of ruling elites to maintain their hegemony, which today's technologies of communications and "information" make more effective and efficient than ever before. These are the elements of distraction, diversion and division, and I believe that they are the most powerful barriers to social change of all. For instance, today Americans <i>on average</i> watch 4 hours of television a day. Besides providing them immobilizing distraction, it also allows their heads to be filled up with images and messages which serve to divert attention from concrete political/social/economic realities, and also to foster scapegoating and propagate false "facts" and entirely fictional realities (e.g. poor people getting mortgages caused the global financial crisis.)<br /><br />Until those of us who do not accept and submit to the hegemonic system are able to overcome the strategic disadvantage these tools of capital put us at, I'm afraid we'll simply have to accept life in an increasingly repressive and unequal corporate state.<br /><br />Yours in service to Cross and Capital,<br /><br />Rocky Rococo<br />ArchvillainRocky Rococonoreply@blogger.comtag:blogger.com,1999:blog-6058072377999486184.post-26432833507559825532011-11-13T18:37:13.410-06:002011-11-13T18:37:13.410-06:00Let's look at the case of Evan Williams. He s...Let's look at the case of Evan Williams. He started a company writing project management software. The idea did not work out. He tried to pivot the company towards writing one of the first blogging platforms. Everyone else in the company quit due to lack of money. He worked alone, for a year, living on ramen trying to make the company work. The idea finally took and his software became popular. Google purchased the company and you now use the platform yourself to write your blog. Williams made millions dollars from the sale of Blogger to Google.<br /><br />Does Williams deserve his millions? If not how much does he deserve?<br /><br />Let's say that Williams then invests $1 million of his wealth in a solar panel startup that has only a 10% chance of succeeding. The company does well, and his $1 million turns into $10 million. Is this $10 million "deserved"? What if the $1 million turned into $100 million?<br /><br />I agree there are many millionaires who do not deserve their wealth. But I want to explore if any deserve their wealth, and if there is any non-subjective way to determine which earnings are deserved and which are not.Devin Finbarrhttp://intellectual-detox.comnoreply@blogger.com