From the comments

by on May 29, 2014 at 2:50 pm in Economics, Education, Philosophy, Uncategorized | Permalink

Mesa wrote:

I would suspect that successful research institutions don’t feel obliged to redistribute their funding to less fortunate institutions. I think the point that is interesting here is that successful academic institutions are probably deemed to have earned their support, while successful business people are not, they having generally thought to have earned their success through luck or inheritance. From the endowment and research funding data it seems universities have both high income inequality and wealth inequality, to use terminology from the current debate.

I would suspect that successful research institutions don’t feel obliged to redistribute their funding to less fortunate institutions. I think the point that is interesting here is that successful academic institutions are probably deemed to have earned their support, while successful business people are not, they having generally thought to have earned their success through luck or inheritance. From the endowment and research funding data it seems universities have both high income inequality and wealth inequality, to use terminology from the current debate. – See more at: http://marginalrevolution.com/marginalrevolution/2014/05/gini-coefficient-for-u-s-universities.html#comments

I would suspect that successful research institutions don’t feel obliged to redistribute their funding to less fortunate institutions. I think the point that is interesting here is that successful academic institutions are probably deemed to have earned their support, while successful business people are not, they having generally thought to have earned their success through luck or inheritance. From the endowment and research funding data it seems universities have both high income inequality and wealth inequality, to use terminology from the current debate. – See more at: http://marginalrevolution.com/marginalrevolution/2014/05/gini-coefficient-for-u-s-universities.html#comments
I would suspect that successful research institutions don’t feel obliged to redistribute their funding to less fortunate institutions. I think the point that is interesting here is that successful academic institutions are probably deemed to have earned their support, while successful business people are not, they having generally thought to have earned their success through luck or inheritance. From the endowment and research funding data it seems universities have both high income inequality and wealth inequality, to use terminology from the current debate. – See more at: http://marginalrevolution.com/marginalrevolution/2014/05/gini-coefficient-for-u-s-universities.html#comments

I would suspect that successful research institutions don’t feel obliged to redistribute their funding to less fortunate institutions. I think the point that is interesting here is that successful academic institutions are probably deemed to have earned their support, while successful business people are not, they having generally thought to have earned their success through luck or inheritance. From the endowment and research funding data it seems universities have both high income inequality and wealth inequality, to use terminology from the current debate. – See more at: http://marginalrevolution.com/marginalrevolution/2014/05/gini-coefficient-for-u-s-universities.html#comments
I would suspect that successful research institutions don’t feel obliged to redistribute their funding to less fortunate institutions. I think the point that is interesting here is that successful academic institutions are probably deemed to have earned their support, while successful business people are not, they having generally thought to have earned their success through luck or inheritance. From the endowment and research funding data it seems universities have both high income inequality and wealth inequality, to use terminology from the current debate. – See more at: http://marginalrevolution.com/marginalrevolution/2014/05/gini-coefficient-for-u-s-universities.html#comments

GiT May 29, 2014 at 3:06 pm

Who, exactly, doesn’t think Harvard earned its 30 billion dollar endowment through a lot of inheritance and contingency?

E May 29, 2014 at 3:18 pm

Someone who needs a good straw-man so they can support wealthy businesspeople against the unimpressed?

Salem May 29, 2014 at 5:34 pm

But that’s exactly Tyler/Mesa’s point. Inheritance and contingency played a huge role in Harvard’s huge wealth and income, but “progressives” accept this as legitimate and don’t talk about redistribution in this context. Inheritance and contingency play a far smaller role in the wealth and income of business people, yet “progressives” use words like “unearned” and “lottery” to describe it, and try to expropriate it.

The obvious explanation for the hypocrisy is that those people have a cultural hatred of commerce – i.e. that the money has gone to the wrong sort of people. This was also Hayek’s critique in “Intellectuals and Socialism.”

Cahokia May 29, 2014 at 6:10 pm

Why reduce the issue to a political football?

You could just as easily argue that this is a major lapse on the part of so-called progressives rather than use it as a battering ram against all redistribution.

In fact, it might just expose that the ideological divide is simply an inter-elite squabble.

As for why progressives *and* conservatives don’t raise the issue of Harvard’s endowment, I’d point to Ron Unz’s argument for why Asian intellectuals don’t speak up on the Ivy Leagues Asian Quota, a quota I should add that exposes the luck, inheritance, and nepotism behind elite academia:

“Most prominent Asian activists are either affiliated with universities or have close ties with individuals who are. Regularly denouncing the perceived misdeeds of “white supremacists,” rightwingers, or even merely Republicans is an easy position to take given that those groups possess negligible influence within the academic community. But Harvard University and its peers dominate higher education like a colossus, and leveling criticism against such targets is hardly conducive to academic career advancement.”

C May 29, 2014 at 6:24 pm

Is this satire? I can’t tell if you really believe the arguments for wealth taxes are this simplistic.

TMC May 29, 2014 at 8:25 pm

1. Nope. and 2. they are.

This how hypocrisy works.

GW May 29, 2014 at 6:37 pm

Salem wrote: “Inheritance and contingency played a huge role in Harvard’s huge wealth and income, but “progressives” accept this as legitimate and don’t talk about redistribution in this context.”

As a progressive, I don’t accept this at all. Indeed, I believe one measure of the broad failure of institutions like Harvard with its huge endowment is that the endowment has grown but the number of students the institution serves and the amount of research produced has not grown in step with both this investment and the growth in the population. In contrast, there are plenty of state research universities which have grown steadily in their productivity despite miserly funding and small endowments.

dead serious May 29, 2014 at 9:18 pm

Cosign. Also progressive.

z May 29, 2014 at 8:02 pm

There have been arguments by “progressives” to force Harvard and other tax advantaged entities to either spend their endowments or be taxed on them. Those proposals were shot down, by among others, conservatives.

GiT May 29, 2014 at 8:51 pm

Pretty sure people on the left are quite critical of inequality among universities, and the relative financial security of the Ivies in comparison to community and state colleges which chiefly serve poorer communities.

dead serious May 29, 2014 at 9:19 pm

Exactly. The attempt to make this some kind of politically polarizing choke point: failed.

Eric May 29, 2014 at 10:47 pm

This progressive wouldn’t mind redistributing some of Harvard’s endowment. :)

ThomasH May 30, 2014 at 6:43 am

I don’t understand why people unsympathetic to redistribution try to turn tax reform into just another chapter of the culture wars. George Romney heard the idea of another percent or two on the top income tax rate and thought “Class War!”

Andrew' May 29, 2014 at 3:14 pm

I have barricaded my door because I am convinced that one of the Ivy Leagues is going to break it down, Elian Gonzales style, and drag me to a good education. I’ll say hi to Bryan Caplan when I’m loaded into the first cattle car.

XVO May 29, 2014 at 3:48 pm

Did you get this from a mad lib?

I have (action) because I am convinced that one of the (noun plural entity) is going to break it down, (influential Cuban) style, and drag me to a (place or thing). I’ll say hi to (person related to entity) when I’m loaded into the (place, Holocaust reference).

I have hid in the basement because I am convinced that one of the Fast Food Restaurants is going to break it down, Fidel Castro style, and drag me to a (~)good meal. I’ll say hi to Ronald McDonald when I’m loaded into the gas chamber.

Chris S May 29, 2014 at 5:09 pm

What sentence or statement does NOT fit this structure?

What (noun) or (noun) does (transitive verb) [not] this [noun]?

andrew' May 29, 2014 at 5:18 pm

Are you from Harvard?

Alexei Sadeski May 29, 2014 at 3:31 pm

Inheritors *do* deserve their wealth – the person who originally earned it decided that their descendants should possess their wealth. It is theirs to give.

MG May 29, 2014 at 5:19 pm

+1

Urso May 29, 2014 at 5:24 pm

Ah, but the original post does not say “deserve,” it says “earn.” That is a difference, is it not?

Jan May 29, 2014 at 5:30 pm

I’ve always thought that “deserving” wealth should be contingent upon whether one climbed into this world through a *gold-plated* vajayjay. That’s hard work.

Willitts May 29, 2014 at 8:29 pm

My incentive to earn wealth is dependent upon the value I place upon the girls who came out of a certain vajayjay and the persons who will likely come out of those girls’ vajayjay. I invite you to get your face and fingers out of their vajayjays and my wallet.

It has nothing to do with “luck.” It has everything to do with biological incentives to care for your own young. Unless you want to start redistributing children too.

Jan May 29, 2014 at 9:30 pm

I’m sure your vajayjay is quite nice but why should my fingers be in it when there are so much easier ways to win at life, such as working hard to make sure I am born to some very wealthy parents? The incentives to pre-borns are obvious.

Cliff May 29, 2014 at 9:39 pm

You seem to have completely missed the point?

Jan May 29, 2014 at 9:49 pm

You seem to not understand what inane arguments are being made here?

Ricardo May 30, 2014 at 1:42 am

In case it needs to be spelled out, no one is stopping you from “car[ing] for your own young.” Some might even have the temerity to argue the best way to care for one’s children is to help them develop talents in their childhood that they can then use to earn their own money when they grow up.

Urso May 30, 2014 at 11:28 am

“Some might even have the temerity to argue the best way to care for one’s children is to help them develop talents in their childhood that they can then use to earn their own money when they grow up.”
Like pay for insanely expensive boarding schools and elite private colleges? Because I thought that’s exactly what you were trying to avoid. Anyway the “some” that “might argue” that are free to do so; and Willits is free to argue that the best preparation is to give his girls a bunch of money. If the “some” are correct that their way is best, their kids will soon outstrip Willit’s kids anyway.

TMC May 29, 2014 at 8:32 pm

The only wealth that is ‘deserved’ is that given to you by the government.

Jan May 29, 2014 at 9:33 pm

The only wealth that is earned is that which is taken via kinship coercion.

GiT May 29, 2014 at 8:53 pm

No, inheritance is a gift and gifts are not deserved.

Willitts May 29, 2014 at 9:41 pm

No, inheritance is deserved by the people for whose benefit it was earned. I work for my children and grandchildren, not for you.

As long as there are people like you who believe you have some claim on the property of others, life and liberty will never be safe.

Jan May 29, 2014 at 9:48 pm

A handout is a handout. Since you support kinship handouts, I assume you support welfare and Medicaid as well.

TMC May 30, 2014 at 9:52 pm

No concept of coerced and voluntary, heh?

Kabal May 29, 2014 at 11:08 pm

How dare you want to give your hard-earned resources to your children and grandchildren rather than random strangers.

GiT May 29, 2014 at 11:43 pm

You may be perfectly entitled to give your “hard-earned resources” to your children and grandchildren rather than random strangers. That doesn’t make your *gifts* to your children deserved by them.

Assuming that what you have to give is deserved by you, this does not mean that what you have given to others is deserved by them. There is a difference between your Christmas shopping list and your accounts payable. And then you have the contested ground in between with things like religious tithing or taxation.

GiT May 29, 2014 at 11:13 pm

As long as there are bootlicking little murderous racists like you, life and liberty will never be safe.

But in the mean time, you might spend some time figuring out what the word “desert” means, because you don’t appear to understand it.

Are you entitled to presents you receive at a birthday? Or a wedding shower? Do you “deserve” generosity? If gifts are “deserved” then the concept of desert is meaningless as there is no basis for distinguishing between things people receive because they are (morally) entitled to them and things they receive even though they are not so entitled.

Someone can have the moral right to give gifts but that does not imply a moral entitlement on the part of the recipient. It’s pretty simple.

Jeff May 30, 2014 at 8:53 am

That’s a fair point, but that isn’t the end of the story. Suppose a parent wants to give a gift to his/her child, but a third person steps in and takes part of the gift, takes all of the gift, or damages the gift so that it no longer has the value it once did, how does that not constitute an injury to the parent or the child (or both)? The child may not deserve the gift, but strangers have a moral obligation not to interfere with the giving of gifts, do they not?

GiT May 30, 2014 at 9:30 am

Sure. That would follow from the moral right of a gift giver to give a gift. But if you don’t have the moral right to dispose of all your wealth as you see fit (uh oh, the evil wealth hating progressives are coming to get you!), then this unrestricted right to give gifts isn’t there.

Jeff May 30, 2014 at 10:27 am

“But if you don’t have the moral right to dispose of all your wealth as you see fit…”

Why wouldn’t you? I could entertain some efficiency arguments re: not letting people do what they want with their own property, or a few specific circumstances, but how do you not at least start with the presumption that people have the right do what they want with stuff they own? Isn’t that what the very concept of ownership entails? Something tells me there are a lot of questionable assumptions lurking behind the ‘if’ in that sentence of yours.

GiT May 30, 2014 at 11:16 pm

Why would you? I start from the assumption that in a world with other beings, the scope of my actions is limited. I also don’t start with the presumption that whatever people have, they have with unfettered moral right. Which is to say I don’t question beg away ownership. There are a lot of questionable assumptions hiding within the assumption that ownership is some simple, settled question.

dead serious May 30, 2014 at 12:10 am

Go build your own roads, fire department, and legal enforcement system and leave us alone, crank.

andrew' May 30, 2014 at 6:44 am

We have by the way.

Are they just going to charge us for the actual public goods?

andrew' May 30, 2014 at 6:46 am

Or like I’m my neighborhood where they withheld police service until we annexed them the roads and during the shutdown are you offering a ransom?

Turkey Vulture May 30, 2014 at 6:17 pm

Those services can be provided at a government expenditure level of a few percent of GDP.

FUBAR007 May 30, 2014 at 1:20 pm

You’re free to take your family and leave the country at any time.

Given your bent, I recommend either Monaco or Singapore.

Ricardo May 30, 2014 at 12:18 am

Not according to Hayek and Nozick.

Marc May 29, 2014 at 3:57 pm

Brand management and protecting the franchise combined with fear of risk taking?

Post hurricane Katrina, the most logical thing to me was that Harvard should have acquired Tulane. (Stop calling it the Harvard of the South, make it Harvard South!) A very high quality asset could have been bought cheap. Harvard and other top universities have no problem making foreign acquisitions that they justify as “globalism” or “building community and relationships” or whatever. For some reason they are averse to domestic acquisition or expansion strategies. (Carnegie Mellon’s New York finance business is an example of a rare exception.) Re-distributing funding versus outright acquisition is splitting hairs over capital structure.

Mark Thorson May 29, 2014 at 5:43 pm

CMU also has a branch in Silicon Valley.

http://www.cmu.edu/silicon-valley/

They’re transitioning from a bricks-and-mortar university to a brand.

andrew' May 30, 2014 at 6:51 am

This is my point.

They don’t do this. Why?

To me the answer is obvious.

Dan May 29, 2014 at 4:34 pm

I believe that successful businesses should not have to redistribute their resources to less fortunate businesses.

andrew' May 30, 2014 at 6:54 am

But maybe they should apply their capital at high rates of return by expanding their business.

honkie please May 29, 2014 at 4:39 pm

Leftists, I presume, abhor inheritances because the beneficiary did not not earn the money. Other forms of redistribution seem to undergo no such scrutiny.

A B May 29, 2014 at 5:32 pm

Ostensibly, yes. But I daresay that I have met many leftist scions, and none of them renounced their own inheritence, beyond some modest non-lifestyle-changing amounts. On the other hand, poor leftists want other people’s money, so not having earned it is as good a reason as any. And then of course, there’s the whole ‘eliminate mediating institutions like family’ thing going on as well.

GiT May 29, 2014 at 8:57 pm

Not necessarily. Concern over earning money is more of a conservative bugaboo. On the broad left it’s certainly consistent with a sort of liberal meritocratic vision. But “leftists” of the scary ‘oh noes they’re going to bring the gulags to America’ variety probably abhor inheritances because the beneficiary does not need the money. That whole Marxist slogan thing; ‘from each….” You know the rest.

Jan May 29, 2014 at 5:00 pm

Academic institutions are people too, my friend.

Chris S May 29, 2014 at 5:10 pm

Its people!

http://soylent.me/

Mesa May 29, 2014 at 7:38 pm

One would imagine that Greenwich, CT would have a similar place to Harvard in a list of towns in the US sorted by income and wealth, and that the list of towns would also have high per-capita GIni income and wealth coefficients. And we know and/or suspect that individual incomes and wealth have a high Gini coefficient. And I suspect corporations exhibit the same effects as well, as do sports teams, etc.. [Note that their may be normalization problems with some comparisons]. So probably unequal outcomes are inevitable in competitive endeavors given uneven competitive skill? But whereas we would think it silly to re-assign research money from Harvard to an institution with a poor research record, and we haven’t seen proposals to wealth-tax Harvard’s endowment, many don’t think it’s problematic to tax individuals or corporations with records of financial success, not to balance the budget per se (which would be OK), but to redress/punish their outsized or undeserved success. Now, some of this motive may be due to the perception of ill-gotten gains in cf. the financial markets. If so, perhaps the right idea is better regulation of those markets, not some quixotic overall attack on “inequality.” If the larger problems facing the world are to be solved, I would suggest people get on their knees and pray for continued “inequality”.

dead serious May 29, 2014 at 9:27 pm

“we know and/or suspect”

This is the entire foundation of the conservative platform. (Strong) emphasis on the latter, usually.

Mark May 30, 2014 at 12:19 am

Let’s be careful in our comparisons. If a corporation or a research institution fails to obtain sufficient resources, it may wither and die. The same for humans. I believe that the ethical/moral frameworks that people follow will not equate those negative outcomes. Thus, redistributive measures make more sense in the human realm.

Certainly, many are comfortable with some degree of human “withering”. The costs of pursuing less inequality might lead to lower welfare in the aggregate. What are acceptable/unacceptable levels of equality and inequality? That’s a discussion worth having.

Ricardo May 30, 2014 at 12:38 am

“we haven’t seen proposals to wealth-tax Harvard’s endowment”

Except we have — google around for various posts on the subject from May 2008. There was a lot of concern — before the financial crisis hit and presumably shrank Harvard’s endowment considerably — that Harvard was accumulating assets tax-free and not doing anything productive with them. Certainly not, say, giving students much of a break on their tuition bills.

Inequality in research money strikes me as a red herring as well. Research money is supposed to reimburse the cost of research. If you are a particle physicist — or an economist running randomized controlled trials around the world — your research may require millions of dollars of support to do properly. If you are a philosopher or economic historian, your research probably is much cheaper. Research money is analogous to revenue, not to profit or personal income.

Finally, the call for better regulation of markets may be a bait and switch or may be a sincere wish. But, in any case, since most of us agree that regulation is actually a complex subject and is prone to capture by interest groups, calling for sensible regulations and actually getting them are two different things.

Mesa May 29, 2014 at 7:47 pm

And to be clear, the current debate is focusing on regularizing inequality of outcomes, not necessarily attempting to ensure equality of opportunities, which I think everyone is in favor of, and which may require higher tax burdens for that purpose.

what would ernest borgnine do May 29, 2014 at 9:47 pm

Mesa – thank you for some of the best sentences on the internet I have ever read…. however, I wish that people, including you, would be more amenable to realizing and verbalizing the fact that that there are No universities on this earth that are elite for more than a few years at a time… even Caltech and West Point, to use the most elite American examples, have had their multiple-decade doldrums. Harvard is, unfortunately, an intellectual muppet-factory with great visuals that are subjectively, and almost objectively, charming, but with quite a lot of despicable financial unfairness in the unviewable background. I wish Harvard were a better place, as its Bible reading founders had hoped it would be, but in the vast majority (dread word, as Wallace Arnold used to say) of its departments, it just is not. If asked, I would say that I deeply regret having spent so much of my life (to be autographically honest, maybe 2 or 3 percent – not a big number to you, maybe, but a big number to me and my dogs and my friends) among those who have gypped me out of my conversational, reflective, and philosophical leisure time by fooling me with the glamour of their credentials, leading me to repeated wrong-headed decisions that they (they being the academically credentialed with good jobs or good job prospects) were worth spending so much of “my finite time on this earth”
with (as Bob Newhart said on a recent sitcom to an overenthusiastic Star Wars fan). (I am never asked so of course I never say that). That being said, of course Piketty, right or wrong, is out of his league, there is almost no way he understands average humanity better than the average rest of us. Too much amour-propre, too little time in Clermont-Ferrand and Peoria.

Slocum May 29, 2014 at 8:29 pm

File this criticism along with progressives agreeing with Barry Schwartz that ‘too much choice’ is wasteful, potentially paralyzing and dehumanizing when it comes to, say, the number of boxes of cereal on the shelves of supermarket but, curiously, never when it comes to the number of books on the shelves of a library. Of course, the ‘too much choice’ progressive, anti-market hobby-horse is soooo 2011 (and hopefully we’ll be able to say the same about inequality by, say, 2016).

trackvikings May 29, 2014 at 8:39 pm

I’m unconvinced by this analogy. I guess I might not “count” as I’m not someone who calls for taxation for taxations sake. Universities are not entities in the same way individuals are entities. I actually think if you came up with a proposal to tax large university endowments and use the money to pay for a system where more total universities than currently exist could strive and argued that this would ultimately lead to more universities at about the level of the current 75th percentile to exist, that proposal might have some support.

Again, I may be confusing personal opinion with “broadly held opinion by similar people”, but I don’t think people support direct monetary transfers to the 40th percentile of earners even if they support some direct transfers to the bottom 20th percentile, but people might support spending that they thought would improve many of the overall conditions for the 40th percentile and below.

Notice that highly progressive taxation coupled with slightly regressive spending is still overall a progressive policy even if it wouldn’t be desired by those who call themselves progressives.

Jan May 29, 2014 at 9:43 pm

Well that is a fine hypothetical, but you know the only reason to tax anything is to punish success, give low achievers something for nothing and expand the state. There is literally nothing good that can come from taxation. Inequality is a primary measure of the success of a society. More is better.

Larry Siegel May 29, 2014 at 11:39 pm

Well I’m almost there but not quite. Some people can’t help themselves. They need to be helped. Even if only from a selfish point of view, I don’t want to have to step over starving beggars on my way from the nice house that I’ve earned to the nice car that I’ve earned. But I’m not quite that selfish. I want them to be helped for their own sake. Moreover, there but for the grace of God go I.

In addition, some goods are public goods and the private sector will not supply enough of them. How about roads, the police, the fire department, national defense, parks, and clean air. Some good comes from taxation. The questions that then arise are: how much shall we take from people by force, and what will it be used for?

andrew' May 30, 2014 at 7:05 am

Stop crowding out actual public goods. Stop using public goods as a dangling strawman to crowd out public goods.

“We need public goods therefore anything goes!”
Analogous
“We need roads so sports stadiums”
“We need public health so in kind earmarks that driv up medical costs”
“We need national defense therefore NSA spying on everyone.”
Feel me?

Hopaulius May 30, 2014 at 12:48 am

Harvard is wealthy for three reasons: it is the oldest university in the US; its graduates over the centuries have done very well financially and have expressed their gratitude (or some other emotion) by donating to the endowment; and they have had outstanding investment managers. One of the motivations for donating to Harvard is that it is a non-profit institution and not subject to taxation. This makes large contributions deductible from the taxes of donors. If we tax Harvard and other universities, obviously they will no longer be tax-exempt, and therefore might no longer be considered eligible for deductible donations (this will depend on the specifics of the tax legislation). In any case, I suspect that wealthy donors will be a little less apt to donate to an institution if the government is going to seize a portion of the donation and redistribute it to institutions the donors deem less worthy. Moreover, the aforementioned investment managers will be the best on the planet at structuring the endowment so as to minimize the tax bite. They will be aided in this endeavor by the legion of Harvard-educated government officials who will help shape the legislation, which will therefore likely be symbolic rather than substantive.

Sam May 29, 2014 at 8:42 pm

Mesa, you lose me with the idea that redistribution’s goal is to redress/punish undeserved success. Who says that?

You are pointing out a perceived dissonance in the progressive position (redistribution is okay between individuals, but why not institutions, or sport teams, or businesses?), that I don’t believe is necessarily there. As a progressive, why can’t I simply say that inequality is okay in some circumstances (e.g, research, business, technology) and less okay in others (e.g., individual well-being and wealth)? Individuals and research institutions are vastly different entities, with different consequences if they fail/succeed and different characteristics on almost every level.

I won’t try to defend the idea that inequality is bad on an individual level; that’s a different debate. What I take issue with is that your point seems to be that the fact that there is a dissonance in the progressive position is what undermines it, not the position itself.

Mesa May 29, 2014 at 9:38 pm

I guess I would say non punitive taxation and redistribution is fine. If so, set a budget, justify the exoenditures, and discuss tax incidence policy. When the argument takes an anti success tone it’s less fine. The current argument seems to be veering that way. Krugman’s plutocrats and other hyperbolics. What is Harvard but a bunch of intellectual and financial plutocrats? Look up the compensation record for the Harvard endowment.

ThomasH May 30, 2014 at 7:08 am

“Set a budget, justify the expenditures, and discuss tax incidence policy.” I suppose most liberals would like to do that, but when they do, they are accused of punishing success to buy votes from parasitic low lifes.

Jeff May 30, 2014 at 9:09 am

“As a progressive, why can’t I simply say that inequality is okay in some circumstances (e.g, research, business, technology) and less okay in others (e.g., individual well-being and wealth)? Individuals and research institutions are vastly different entities, with different consequences if they fail/succeed and different characteristics on almost every level.

Shouldn’t there be some sort of principle, then, that we can formulate regarding when inequality (or perhaps just meritocracy) is justifiable or tolerable? How do we avoid the debate devolving into “I like Harvard so let’s leave them alone, but I hate Wal Mart and the Walton Family so let’s take their stuff?”

Chip May 29, 2014 at 8:49 pm

The argument for redistribution is riddled with hypocrisy.

Do politicians and bureaucrats redistribute their power or seek more?

Are progressives more likely to volunteer or donate than conservatives?

Do athletes share playing time, actors speaking parts in a movie?

Everyone hoards their accomplishments. But it is only people who earn through business – often those who have worked hardest and taken the most risks – who are to give it up in the name of fairness.

GiT May 29, 2014 at 9:01 pm

Pretty sure progressives want wealthy athletes and actors to give up their wealth in the name of fairness too. They also tend to like the democratization of political institutions. But continue concocting whatever silly phantasmagorical hypocrisies you can squeeze out of your rear.

Willitts May 29, 2014 at 9:46 pm

What euphemism will you use when “progressive” becomes stained with the filth of your ideology?

I’d like to get my bumper sticker machine up and running before the rush.

Jan May 29, 2014 at 9:52 pm

One hour, no, two hours of hate today! The progressive scum are ready gonna hear it this time!

GiT May 29, 2014 at 11:16 pm

I actually don’t use the term progressive. I only see it used by conservatives and party-line type democrats, who aren’t that far from conservatism themselves. But it’s the word people use here.

charlie May 29, 2014 at 10:14 pm

“This kind of coverage that blames income inequality on widely popular public figures is creating a false sense of who the real culprits are. They’re trying to tell us that income inequality [is] the fault of our favorites, who’s talent we admire, and not the super-wealthy’s unhealthy influence in our government that’s tilting the playing field in their favor.”
http://www.dailykos.com/story/2011/10/26/1030209/-MSM-is-blaming-income-inequality-on-Actors-Athletes-Musicians-WTF#

GiT May 29, 2014 at 11:20 pm

I don’t expect much coherence in pablum from some dailykos blogger. I’m sure if you pushed the person they’d have to admit they think millionaires they “admire” ought to be taxed relatively heavily. If not they’re just clueless.

Chip May 30, 2014 at 2:51 am

They want OTHER people to give up their wealth.

Exactly.

But on personal level – volunteerism and donating to charity – they give less than conservatives.

Hence the hypocrisy.

And I’m not sure “progressives” is an epithet. Don’t they self identify as such?

GiT May 30, 2014 at 9:36 am

Except the research by the AEI hack showing that conservatives give more than liberals hasn’t held up. There’s not really much of a difference, and what appears to be a difference is just the result of the religiosity of conservatives. But I don’t consider much to be charitable about giving money to mythology obsessed social clubs.

Mesa May 30, 2014 at 1:11 am

Additional Notes:

1. What makes something “good” or “great” compared to “average” is it’s relative scarcity on one tail of the quality distribution. Thus by definition there are fewer good and great things than average things. In a market context this justifies a cost premium and an increased resource allocation. To allocate investment resources to the good and great increases marginal societal utility in the same differential way allocating consumption resources to the less affluent does. The marginal effect obtains for both investment and consumption.

2. Rich people or companies or universities can’t eat everything. Getting really rich only gives you the opportunity to personally allocate resources above what you can consume through investments. Look at Bill Gates or Apple or Google. Who is a better allocator of societal resources, a highly successful businessman or 100,000 people who might share his bounty via small amounts of increased consumption? Think of Harvard. Think of the businessman and his boats. OK. But maybe he starts a new business. Maybe not. Maybe a corporation moves funds onshore with reduced taxes and hires people. Maybe not.

3. Maybe the issue here is between the marginal utility of aggregated investment versus disaggregated consumption, with very opposite ends of society appearing to win claims on the highest marginal utility in each category.

4. There has to be an agreement on the approximate magnitude of these marginal effects to form policy. When you have fairly poor people without health care in a first world country that tends to sway the argument. However, it’s also possible that the quantity of resources being devoted to those problems is already sufficient, just inefficiently applied.

5. Rhetoric attacking successful people, corporations or institutions for their success is about as useful as attacking poor people for being intentionally poor.

GiT May 30, 2014 at 2:18 am

Intentionally rich people have the ability to not be rich. Intentionally poor people may or may not have the ability to not be poor. “Attacking” either group might be ineffective, but there’s a pretty salient difference between the two categories.

Ray Lopez May 30, 2014 at 1:45 am

This is the sixty-fifth comment, and 64 is the name of a Soviet chess periodical as well as the number of squares on a chess board.

Just to be substantive, I’ll just say that ‘how’ a person made their money is important. Hence people up in arms over inheritance have a legitimate concern. Do you mind if a person got rich from crime? Yes. Do you mind if a spoiled brat inherited their money from a mobster? Similar. From a hard working parent but now the brat is unproductive? Analogous. So the concern about the ‘rich getting richer’ does have a logical basis, namely, undeserved wealth, though also it’s driven by envy.

ThomasH May 30, 2014 at 6:33 am

I’d suppose that the reason we don’t consider taxing a bit of Harvard’s income to fund Podunk U is that we don’t suppose that Harvard and Podunk are at different points on the same utility function in the same way as we think that Mr Buffet and his secretary are. More fundamentally, we don’t tax collectives but individuals. We do seem to tax corporations but only because it is (mistakenly in my view) thought to be an indirect way of taxing the owners in a less costly way than by taxing them directly. No such reasoning applies to non-profits.

andrew' May 30, 2014 at 6:57 am

Did the government earn my inheritance? Not if their system was so unfair as to provide such favoritism.

Jim Bang May 30, 2014 at 10:11 am

Jan wins:
“I’ve always thought that “deserving” wealth should be contingent upon whether one climbed into this world through a *gold-plated* vajayjay. That’s hard work.”

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