How Rich is Too Rich For Democracy?

April 20, 2005 4:22 PM

How Rich is Too Rich For Democracy?At what point does great wealth held in a few hands actually harm democracy, threatening to turn a democratic republic into an oligarchy? It's a debate we haven't had freely and openly in this nation for nearly a century, and last week, by voting to end the Estate Tax, House Republicans tried to ensure that it wouldn't be had again in this generation. But it's a debate that's vital to the survival of democracy in America. In a letter to Joseph Milligan on April 6, 1816, Thomas Jefferson explicitly suggested that if individuals became so rich that their wealth could influence or challenge government, then their wealth should be decreased upon their death. He wrote, "If the overgrown wealth of an individual be deemed dangerous to the State, the best corrective is the law of equal inheritance to all in equal degree..."
posted by mk1gti (65 comments total)

The gini coefficient is a quick and easy measure of wealth distribution in a nation. The higher the number (either 0 to 1 or 0-100%) the more inequality of distribution. A score of 0 indicates that wealth is distributed perfectly equally, wheras a score of 1 means that one person has everything and nobody else has anything.

2004 Gini coefficients in selected countries
(from the United Nations Human Development Report 2004)

Denmark: 0.247
Japan: 0.249
Sweden: 0.250
Germany: 0.283
India: 0.325
France: 0.327
Canada: 0.331
Australia: 0.352
UK: 0.360
Italy: 0.360
USA: 0.408
Hong Kong: 0.500
China: 0.447
Russia: 0.456
Mexico: 0.546
Chile: 0.571

Also see 2003 data. According to this data the net US wealth distribution inequality stayed exactly the same from 2003-4.

Interestingly, the world disparity in income has dropped over the last 30 years (PDF, see p.5, p.10) It's somewhat unrelated, but interesting to note.
posted by thedevildancedlightly at 4:44 PM on April 20, 2005

At what point does great wealth held in a few hands actually harm democracy, threatening to turn a democratic republic into an oligarchy?

And when did you stop beating your wife?
posted by rush at 4:49 PM on April 20, 2005

There is a debate underway in the Senate where Republicans have been negotiating with Democrats. The House rejected a Democratic alternative that would have exempted the first $3 million of an estate's assets from the tax - the first $6 million for a family estate - while capping the top rate at 47%.

The Democratic proposal was a fair compromise. It is important to note that owners of small family businesses (many of them blue collar jobs such as plumbing, landscaping and masonry) who fall into the $3-$6 million category are not "[i]individuals [who are] . . .so rich that their wealth could influence or challenge government"

*awaits the arrival of the knee jerk MeFi crowd who described blue collar small business owners with calluses on their hands and dirt under their fingernails as pampered billionaires with yachts the last time we had this discussion*
posted by MLIS at 4:49 PM on April 20, 2005

In the introduction to the book Wall Street: "Leaving aside the principal residence, the richest 1/2% of the U.S. population claims a larger share of national wealth than the bottom 90%, and the richest 10% account for over three quarters of the total.".
posted by Gyan at 4:51 PM on April 20, 2005

Leaving aside the principal residence

Given that most Americans tie up the majority of their wealth in their home, that seems like a bit of an important oversight. Does he have data counting the home? Does his data include pension obligations as well? Seems like another significant source of blue-collar wealth that could be swept aside.

That's like saying "leaving aside FPPs about politics, MetaFilter has really on-topic debates that never devolve into ad hominem fights."

the richest 1/2% of the U.S. population claims a larger share of national wealth than the bottom 90%

That is totally out-of-whack with how the UN portrays the data. See my gini coefficient / lorenz curve info above.

Supposedly (I can't find a good cite) the top 1% of US income-earners (not wealth, but income) pay 38% of all US taxes. Again, tangental, but interesting.
posted by thedevildancedlightly at 5:00 PM on April 20, 2005

When money changes hands from one person to another, it's taxed. Simple as that.

All the services that make this country such a pleasant place to live (police, fire fighters, roads, schools, etc.) have to be paid for, and it's paid for in current taxes. When someone gets $100 million from Dear Dead Dad without paying a cent on it, then dumps it into a Swiss bank account, that cash isn't being used for any of the services, but you can bet your sweet ass that they'll be on the phone to Commisioner Gordon if there's a strange black man wandering about their exclusive neighborhood.
posted by Civil_Disobedient at 5:09 PM on April 20, 2005

From the article cited by MLIS:

"According to data from the Internal Revenue Service, in 2004 only 440 estates where a family farm or business represented the majority of the value of the estate owed any estate tax."

They may not be pampered yacht-clubbers but is taxing 440 estates really an issue that effects all people? The way the Repubs are framing this issue, you'd think it was a burden on us all.
posted by effwerd at 5:10 PM on April 20, 2005

This should help -

"In 1995, the richest 1% of households claimed 11% of total income — but had 31% of all assets, 35% of all net worth, and 43% of net worth if you disregard the principal residence, which is the lion’s share of most middle-class wealth. The richest 1/2% had a larger share of total nonresidential net worth than the bottom 90% of the population (34% vs. 22%); the richest 10% accounted for 78% of nonresidential net worth"

"segment / nonresidential % / net worth %
0-90 / 22.5 / 31.5
90-100 / 77.5 / 68.4
90–98.9 / 34.2 / 33.2
99–99.4 / 9.1 / 7.6
99.5–100 / 34.2 / 27.5
l"

The figures are taken from Kennickell, Arthur, and R. Louise Woodburn (1997). “Consistent Weight Design for the 1989, 1992, and 1995 SCFs, and the Distribution of Wealth,” unpublished technical paper, Federal Reserve Board, June 23.
posted by Gyan at 5:37 PM on April 20, 2005

Is it just me or have republicans, neo-cons and their followers given democracy and freedom a good swift kick in the balls?
posted by mk1gti at 5:39 PM on April 20, 2005

The trouble is that the more redistributive policies increase equality, the more they also impose deadweight loss and inefficiency on the economy - effectively shrinking it. So you have to strike a balance between the size of the pie and equal shares, knowing that every time you increase equality you decrease social welfare overall. Facially, then, it seems to roughly follow that you want as much inequality as possible without allowing that inequality to pose a threat to stability, because economic strength with inequality is generally preferable to equal poverty.

If you'd prefer a different lifestyle, then you might consider, say, Sweden, which is highly equal but has one of the lowest standards of living in all of Western Europe.
posted by gd779 at 6:04 PM on April 20, 2005

When someone gets $100 million from Dear Dead Dad without paying a cent on it, then dumps it into a Swiss bank account, that cash isn't being used for any of the services

It's not lying totally idle, either. It's underwriting whatever enterprises the bank is lending out to, which may include business, which may employ people, who may pay taxes, whihc may be used for any of the services. I realize this is oversimplication, but then, so is viewing a Swiss bank account (why Swiss?) as Scrooge McDuck's vault.

Moreover, in my state at least, Commissioner Gordon gets paid from real estate taxes, not general revenue.

(That being said, some of the enterprises banks are backing these days are truly hair-raising, far more frightening than the cash grab under discussion here. I would ask someone more economically astute than me to whip up a post on that subject.)
posted by IndigoJones at 6:08 PM on April 20, 2005

I'm with the FRB figures--counting principle residence doesn't make sense.

1) We care about wealth in this context for political reasons. A home is the major source of savings for the middle class, but is hardly fungible by any stretch of the imagination.

2) Most residences are *annually* taxed. (Isn't this double taxation, if I buy a house with post-tax dollars?)

3) Getting data on equity (as opposed to land value) is a lot harder than getting securities information.

It is true that home ownership is higher in the US, undervaluing the wealth of our middle class BUT the theory that Americans intentionally substitute home ownership for savings does hold in many (not entirely contraversial) studies.

(Huh? What? Why yes, I am a wonk. Why do you ask?)
posted by allan at 6:12 PM on April 20, 2005

So what are "standards of living" anyway? One thing's for certain...they're fluid. Isn't it really about perception?

So Norway might have the lowest "standards of living in all of Wester Europe" but perhaps their standards make sense, and its our standards that are fucking ridiculous?

A friend of mine is due an inheritance of many millions of dollars. She's a die hard Republican (duh) and she looks at it like this: She and her family have earned their inheritances by sacrificing their father's love. He works in another state all week and they see him on the weekend. When they see him he's all stressed out.

I believe in her argument, but I'll tell you what...we all sacrifice for our money. I've sacrificed my body and time with my children. I think I deserve to have my tax burden not be as high as some rich person who wants to leave 30 million dollars to each of his immediate family members.
posted by taumeson at 6:17 PM on April 20, 2005

When money changes hands from one person to another, it's taxed. Simple as that.

So you are opposed to the compromise the Democrats offered in the House? Where would you draw the line? Any assets over 50K, hit 'em with the estate tax?

Thanks for stopping by with the irrelevant nonsense about the "black man", though.
posted by MLIS at 6:17 PM on April 20, 2005

And then we have this

and this
posted by mk1gti at 6:17 PM on April 20, 2005

Re: Norway and relative standards of living, see Bruce Bawer's recent op-ed in the NYTimes "On the Wealth of Nations".

Just to stir the pot a little more....
posted by IndigoJones at 6:23 PM on April 20, 2005

(Sorry, double post. Typing too fast. But Bawer is always interesting- Wander around his site a bit)
posted by IndigoJones at 6:24 PM on April 20, 2005

So you have to strike a balance between the size of the pie and equal shares,

Right, but you also need to maintain the both the appearance and reality of 'fairness' for stability. This requirement tends to shift the balance to a smaller than otherwise possible pie. And this is what's constantly being negotitated, not just hard economics but rather this fairness perception.

Perhaps in America there are more people who think they stand a reasonable chance of moving into the top 1/2% sometime during their lifetimes and therefore America, relative to a few other countries mentioned can 'afford' a greater imbalance or perception of unfairness. Who cares about fair if you figure you're not going to need it. Just a theory.
posted by scheptech at 6:37 PM on April 20, 2005

Re: conflict between gd779 ("Sweden has low GINI but also low standard of living and mk1gti (Sweden, and Scandanavia more broadly, has higher standard of living than US),

First, from the wikipedia page:

The Standard of living refers to the quality and quantity of goods and services available to people. It is generally measured by real (i.e. inflation adjusted) income per person.... Standards of living are perhaps inherently subjective. As an example, countries with a very small, very rich upper class and a very large, very poor lower class may have a high mean level of income, even though the majority of people have a low "standard of living".

So there are a few issues to sort out here.

1) What measure of "standard of living" are we talking about here? There are several alternatives listed on that wiki page. Are we talking about income, or something else entirely?

2) If income, what kind of income are we talking about? Ratios of real income, or ratios of purchasing power parity, or what? I expect that N-S-F would be higher in real income per person, but lower in PPP since everything is so damn expensive there.

3) But cutting the other way, I'd bet (and gd779 seems to concede) that the distribution in the US is non-Gaussian at best, and possibly even bi-modal. If we seperated the top X% of the US population (for some non-ridiculous value of X, like more than 1%), might they be WAY up there in standard of living, while the lower 100-X% are living in near-European squalor? So in other words, even if gd779 is right, it might just be a way of glossing the question.

Or, if gd779 is wrong, that pretty much obviates the "big pie vs. well-divided pie" debate. But I think he's right, as far as it goes.

On preview, regarding that Bruce Bawer piece: does EVERYONE have to make Adam Smith references when they write about economics? "On the ___ of Nations" is the most over-used econ cliche, by far. The title that the NYTimes ran with was better anyway: "We're rich, you're not. Sorry."
posted by rkent at 6:51 PM on April 20, 2005

On (future) previews, I will also close my parens as well as responding to previous posts.

")
posted by rkent at 6:52 PM on April 20, 2005

I don't blame the super rich on wanting to hoard their wealth; it's how they got rich in the first place.

I blame the idiots who keep voting GOP election after election.
posted by Mean Mr. Bucket at 6:52 PM on April 20, 2005

So you are opposed to the compromise the Democrats offered in the House?

Absolutely. The Estate Tax should not even be a topic of discussion, so "bargaining" is moot. The fact that we're even talking about it shows how far we've fallen.

Thanks for stopping by with the irrelevant nonsense about the "black man", though.

Hey, no problem! Thanks for completely missing the point!
posted by Civil_Disobedient at 7:08 PM on April 20, 2005

posted by troutfishing at 7:53 PM on April 20, 2005

She and her family have earned their inheritances by sacrificing their father's love. He works in another state all week and they see him on the weekend. When they see him he's all stressed out.

Woodgie fucking boo boo. At least she's met her father. Mine died before I was born when his RF-4 smacked the earth, earning a shitty-ass paycheck, and nobody ever handed me a million bucks (though I did get blood money for college). Earn it, my ass.
posted by ROU_Xenophobe at 8:08 PM on April 20, 2005

I suppose I should clarify that he and the front-seater were earning their pittances, not the RF-4 itself. As you know, Bob, the F-4 family of aircraft received only in-kind payments of cashews.
posted by ROU_Xenophobe at 8:10 PM on April 20, 2005

Troutfishing, I must say that's a brilliant use of data. Take one outlier, create a chart around it. And, yes, I know the site says that 144,000 tax returns had over $1,000,000 in income, but $1,000,000 is 3.3 feet (less than the goalpost)

In other words, that chart shows that Bill Gates has a lot of money and absolutely nothing else.

Here's the 1994 US Lorenz curve:


And for 1970, 1980, 1990, and 1994 (shifting outward):

posted by thedevildancedlightly at 8:10 PM on April 20, 2005

Also, here's a better data set showing the recent increase in US inequality. For whatever reason 1967 is set as the "zero" year - anything above the line indicates that the income distribution was less equal in that year than it was in 1967. A decreasing line means income is becoming more equal, an ascending line means income is becoming less equal.


posted by thedevildancedlightly at 8:13 PM on April 20, 2005

In other words, that chart shows that Bill Gates has a lot of money and absolutely nothing else.

Well, it does make a nice counterpoint to the equally pointless "the top X% of US income-earners pay Y% of all US taxes".
posted by Armitage Shanks at 8:38 PM on April 20, 2005

devil - The trend lines of your graph stop at '98. There is more recent data you haven't cited - for good reason : the trend towards greater wealth inequality in the US has likely accelerated.

Nice try though.
posted by troutfishing at 8:49 PM on April 20, 2005

Speaking for what I've seen with my eyes standard of living wise, I live in Seattle and visit Vancouver B.C. every now and then.
They are said to have the second highest standard of living behind Luxembourg, Belgium.
Comparing Seattle and Vancouver, you have Seattle which has a good old fashioned american bureaucracy that doesn't know it's ass from a hole in the ground in getting public projects moving for the good of all (the monorail running all over the city, an ongoing project since after the early 1960's world's fair). Then you have Vancouver, which has their monorail running all over the city and into the outlying areas. Much better access to public transportation, much better health services that the populace isn't afraid to use lest they be thrown into bankruptcy, better schools, less crime, less discrimination, more equitable wealth distribution, etc. etc. All the hallmarks of a true all inclusive democracy working for all instead of the benefit of a few.
Then going back to Seattle you have corporate cronyism where they're subsidizing Boeing which does bullshit for providing jobs in this economy yet they give them millions, if not billions in tax kickbacks they never earned.
There needs to be wealth re distribution and it needs to come directly from these modern day robber barons and back into investing in the common good, meaning schools, hospitals, health care and social services that will benefit all instead of just a few inbred, selfish few.
posted by mk1gti at 8:55 PM on April 20, 2005

Also - try plain words :

Your "outlier" = the income of Americans in terms of stacks of $100 bills, graphed.

The graph is simple : a small percentage of Americans own a great deal of all the wealth in America.

Now, we can argue as to whether - as in the guilded age in America at the start of the 20th Century ( robber barons and all ) - that is a good thing or not.

I think not, and the US CIA analysis agrees : high GINI indices correlate with high levels of social disruption and political violence.
posted by troutfishing at 8:58 PM on April 20, 2005

There is more recent data you haven't cited - for good reason : the trend towards greater wealth inequality in the US has likely accelerated.

I cited the first data set that I found. Sorry for not being the Library of Congress.

Here's the updated data set (also here), not available as a pretty chart.

Here's the "accelerating" data (all are Gini):

2001 0.466
2000 0.462
2000 0.460
1999 0.457
1998 0.456
1997 0.459
1996 0.455
1995 0.450

Accelerating? Seems not to be. An increase of 0.004 per year seems to be pretty constant. Feel free to make your own chart if you want, I have better things to do than accuse people of hiding data. Any increase is bad, but "accelerating" is not an accurate description.
posted by thedevildancedlightly at 9:05 PM on April 20, 2005

Your "outlier" = the income of Americans in terms of stacks of $100 bills, graphed

I'm sorry, that's simply not what "outlier" means in statistics. I'll try to use words that are accurate and precise in their meaning.

Outlier - Outliers are atypical (by definition), infrequent observations

Outliers - Outliers are extreme cases on one variable

Outliers cause problems with statistics as they tend to overwhelm otherwise legitimate data. Here you can't even see what the chart looks like because one person, Bill Gates, has skewed the extreme right side of the picture so that everything looks flat.

Here, by "outlier" I meant that "Bill Gates' income is atypical, an extreme case. There are very few Bill Gates in the US. By definition he is an outlier.

the US CIA analysis agrees : high GINI indices correlate with high levels of social disruption and political violence.

Sure. I think we agree on that. But see the comparative chart in the very first post in this thread. The world high is 0.707 (Namibia). That's not a mark to aspire to, but it gives a sense of the scale of the numbers.
posted by thedevildancedlightly at 9:15 PM on April 20, 2005

Could gd779 please explain how taxing estates shrinks the economic pie we all share? I don't dispute that high marginal rates on income discourage work and entrepreneurship, but seriously, do you really think that the hope of leaving a big estate is what gets our entrepreneurial class out of bed in the morning?

But then why do I bother to argue against Bush’s economic policies? Most of my income comes from long term capital gains. On April 15, I paid 15% on 7 figures of income, no social security tax, and no state income tax. It is crazy. Every time I pass the pickup trucks with Bush/Cheney stickers at the construction site up the street, I feel like walking in and kissing those hard working, salt of the earth, Bush-voting Americans on both cheeks and saying Thank You, Thank You, Thank You…
posted by NoiseTrader at 9:18 PM on April 20, 2005

Over about $20 000 per year in income, money is an irrelevance and a distraction. It doesn't change happiness levels. Suckers might think it does, but the only thing that appears important is how you're going compared to your neighbours. There's a good argument taht we'd all be much better off (happier) if we were taxed to the eyeballs.

Of course, not one of you Americans is going to believe this. Especially since I believe your taxes are about due now.
posted by wilful at 9:56 PM on April 20, 2005

$20,000? Are you joking? I really can't tell.
posted by Sangermaine at 10:24 PM on April 20, 2005

There are places you can live comfortably on $20k a year. Urban California is not one of them.
posted by BrotherCaine at 11:08 PM on April 20, 2005

No absolutely not joking. Over a certain level of wealth, money doesn't buy you any happiness whatsoever - this isn't my opinion, this is something that has been demonstrated by a vareity of studies. Here's a link.

You would need to remove some shackles from your brain to really believe this however. I know I haven't changed my behaviour, I still seek the pay raises over the extra time. But I am a pig, in a cage, on anti-biotics.
posted by wilful at 11:12 PM on April 20, 2005

This is not about "living comfortably on X a year". It's all about competing with your neighbours - it's about what you really need to satisfy the basics of life and from then it's all about being wealthier - totally relative, not absolute.
posted by wilful at 11:16 PM on April 20, 2005

A group of accountants and economists has calculated that at least 11.5 TRILLION dollars is being held in offshore, tax-free havens by the world's richest individuals.

Not corporations, which have significantly more... individuals.

$11.5 TRILLION. Motherfucking TRILLION.

What is that amount of money needed for? Oh shit, we might lose a few billion on our 11.5 TRILLION DOLLARS, we'd best hide it!

Something is so wrong with society. I know attributing without links is suspect, but there was an article in a Greek newspaper over last summer that I cannot find. It reported the findings of a large poll done in each EU country. Despite having the lowest incomes and standard of living by Western, material standards, it used to be Greeks had the highest subjective quality of life... when asked, a majority said life was pretty damned good. And that was while being 'poor'. Since switching to the euro a couple years ago and watching prices for everything including food triple while salaries (what few there are) stay the same, that's changed. I can understand that. If you can't afford to house yourself and eat, you're not going to be happy.

What was interesting to me is that the people last year with the highest satisfaction in Europe were Scandinavians. Despite the European average being in the 60s (as percentile) for satisfaction with life, Norwegians and Swedes were in the mid 90s. You're talking about the vast majority of a population who despite paying so much of their salaries in taxes and who 'drive junky cars' feel that their system is fair and that their lives are good.

Meanwhile a majority of Americans whine if they have to pay among the lowest taxes in the modernized world and if they can't get the newest generation DVD player every six months. I'd take the sanity of Norwegian life over the insanity (and unhealthiness) of American life any day of the week. If it wasn't for those damned six month nights!

Explain to me why if America is so rich compared to a nation like Norway, its infant mortality rate is almost twice as high? Reliance on material belongings to define 'quality of life' is one of the sickest, most insane traits I've ever heard of.
posted by the_savage_mind at 11:23 PM on April 20, 2005

There are places you can live comfortably on $20k a year. Urban California is not one of them.

Factor out land values! The reason California is so expensive is that the ground rents are so high, and a 99% (or more!) of the ground-rent is being pocketed by landlords (before income taxes) thanks to Prop 13.

In any non-socialized regime it would cost a lot (ie rents would still be high) to live in California (since demand for housing so outstrips supply) but if the ricardian rack rents were collected by the state, income and sales taxes could be reduced substantially.
posted by Heywood Mogroot at 12:05 AM on April 21, 2005

If you'd prefer a different lifestyle, then you might consider, say, Sweden, which is highly equal but has one of the lowest standards of living in all of Western Europe.

The author of the column you linked to, Bruce Bawer, seems to have some pretty obscure definitions of the quality of life.

They hang on to old appliances and furniture that we would throw out. And they drive around in wrecks.

Is that really important? Isn't that actually pretty wise anyway? The Norwegians don't make the cars, so the less they buy them, the more they can consume products or services that are made in Norway.

What we really really need are instruments to measure the unmeasurable. Cohesion in a society and the value of safe and clean environment for example. Income distribution, infant mortality and purchasing power are telling indicators, but they are not the whole story.
posted by hoskala at 2:40 AM on April 21, 2005

But you all knew that already, didn't you?

I'm constantly amazed by the belief that people have in statistics, and when available, graphs.

I just read a book, Globalisation and it's discontents by Joseph Stiglitz. A very good read. One of the most interesting tidbits was that the IMF used, in all it's ventures around the globe in the 90's, an economical model that didn't factor unemployment. Mindboggling, but the consequences are clear.

It seems that some politicians try only to run the economy, when politics should be about the society.

Mr. Bower gave us a good example when comparing Sweden vs. the US. He didn't include in his comparison, for example, the fact that university education in Sweden (and Finland) costs nothing. It is considered to be for the best of the whole country that all that are able can study.

There are of course things that we Europeans should do to improve our economy and the service sector in particular, but creating more income inequality is not the answer. It just might be the problem we should be solving.
posted by hoskala at 3:05 AM on April 21, 2005

Scandinavia has a lower quality of life?

2004 Human Development Index. "A composite index measuring average achievement in three basic dimensions of human development—a long and healthy life, knowledge and a decent standard of living." Scandinavian countries have topped the list for the past several years, if not longer. (Canada made #1 once, but one of the Scandinavian has had it since.)

Costs for many things there are higher - but is eating out really a measure of quality of life? Is it better that more middle class people eat in restaurants, but more poor people go without essential medical care? What kind of world do you want to live in?

As for anecdotal evidence, well, I'd like to see Bruce Bawer come hang out in New Haven, Connecticut before he decides that public services in the US are all spiffy. Nice city, great people, but decidedly down at the heel.

hoskala: you make some very good points, especially about community cohesion and quality of life. But the basics (life expectancy, infant mortality, etc) are indicative of many other factors (health, nutrition, etc) which are very important. The psychological factors will likely only come up in satisfaction surveys.
posted by jb at 3:34 AM on April 21, 2005

I feel like walking in and kissing those hard working, salt of the earth, Bush-voting Americans on both cheeks and saying Thank You, Thank You, Thank You…

See, this is the kind of Republicanism I can understand. If you're living in an estate on the coast of Connecticut and pulling in 7 figures a year, why, it's in your best interest to be a Republican.

Thing is, most of those red votes didn't come from the seacoast mansion states. They came from the poor, rural states like Nebraska (which holds two of the poorest counties in the entire country and voted overwhelming for Bush). These people are being actively screwed by policies they vehemently support. It's just amazing.

Rural idiot: "Hey, can we have some money?"
Government: "No, what you want is a swift kick in the nuts!" [kicks nuts]
RI: "Wow, that... really... hurt!"
Gov: "No, that felt good."
RI: "Oh, well then, let's have some more!"
posted by Civil_Disobedient at 3:48 AM on April 21, 2005

Dear GraphFilter,

Governments ALWAYS redistribute money. The question is: how is it to be done and in who's favor? If a estate taxes are to become exempt, the money to run our country must come from somewhere else.

"Now lets' see, where did I see that few trillion dollars laying around? Oh, yeah, in your pockets. Fork it over scumbag...err..I mean citizen."

What's that you say? Starve the gvmnt beast and you get keep your own money to do with as you wish!
Oh, yeah! That's a real good plan!

I don't know if I'm smart but I think I can see
When someone is pullin' the wool over me
--Dylan
posted by a_day_late at 5:02 AM on April 21, 2005

Civil_Disobedient, you'd be making sense if it weren't for too things.

First, middle-class Republicans are in large part voting on national security and/or cultural and religious values. The tax code is simply not relevant, or at least decisive, to their decision in many cases.

Second, to the extent the tax code is relevant, it is being very effectively pitched to middle-class Republicans as a family values matter. Keeping your money and using it to raise your family as you see fit in light of Godly priorities, as opposed to giving it over to the tax collector to be used as politicans and judges think fit, is fast becoming a core plank of the Evangelical public-policy platform.
posted by MattD at 6:16 AM on April 21, 2005

MattD -- You're absolutely right, it just drives me nuts that moral issues (what I'd categorize as "Other People's Business") is more important than their own bottom line. This has already been discussed to death, particularly well in What's the Matter with Kansas.
posted by Civil_Disobedient at 8:24 AM on April 21, 2005

Keeping your money and using it to raise your family as you see fit in light of Godly priorities, as opposed to giving it over to the tax collector to be used as politicans and judges think fit, is fast becoming a core plank of the Evangelical public-policy platform.

Not that the analogy totally works (and I'm not saying MattD is saying this, nor that I'm totally in favor of estate taxes) but I'm always amused that those who lobby the loudest against hand-outs and preach about "pulling" and "bootstraps" often don't apply any of those ideals to their own family...
posted by jalexei at 8:34 AM on April 21, 2005

So much for rendering unto Cœser...
posted by klangklangston at 8:42 AM on April 21, 2005

Speaking of 'Godly Priorities...'


The concept of Limited Goods creates a grasping mentality. If wealth is based on land, (and we know they’re not making any more land), then you must hold on to what you have inherited. The elite class believes that the world is to be exploited, and that honour increases with wealth. This wealth is gained by preying on the poor peasant, who sees only what is left after the master has taken his piece and when it’s not enough to support his family he goes into debt. He must trust that his master will support him in years of famine in return for his service. But inequality breeds injustice and the poor tend to become poorer.

God’s covenant as detailed in the books of Leviticus and Deuteronomy shows that God knows that the gap between rich and poor tends to widen with each generation. Therefore He instructs that every seventh year shall be a Sabbatical year in which all debts shall be forgiven, and after seven times seven years there will be a Jubilee year in which there will be a radical redistribution of wealth. Although devout Jews study the Torah in which God’s plan is laid out, in practice the wealthy have always been able to find legal loopholes whereby they can avoid the periodic forgiveness of debts and redistribution of wealth which God wants.


Jesus’ Vision of Redistributed Wealth

Having filled in the ancient background of the covenant, Herzog went on to explain samples of Jesus’ teaching which speak to the renewal of God’s covenant. In the synagogue in Nazareth (Luke 4:15-30) Jesus reads a passage about the jubilee. He infuriates his audience by his prophecy that the redistribution of wealth will not be confined to the Jews.

To the man who asks “What must I do to receive eternal life?” (Mark 10:17-22), Jesus quotes the six commandments which direct his duty to his family and neighbours. “I have done all these things all my life,” responds the young man. Then Jesus gives him four instructions which direct his duty towards God: “Go, Sell all you have, Give the money to the poor, and Come and follow me.” The young man goes away sadly because he is very rich.

More Here.
posted by Fuzzy Monster at 8:45 AM on April 21, 2005

Sweden, which is highly equal but has one of the lowest standards of living in all of Western Europe.

oh FOR FUCKS SAKE, citing a study by Timbro is like citing a study by [insert far-right-wing US think tank here]. Their shit is constantly debunked. Yes, shit. You see, they pull it out of their asses.
Next.
posted by mr.marx at 8:52 AM on April 21, 2005

Great link Fuzzy Monster.

Prosperity theology is just dead wrong and yet so popular with our fundies in America.

Gee, I wonder how/where/why they got off the "christlike" track?
Could it be justifying greed in the name of God?
Does Dante address that particular part of Hell? :-)
posted by nofundy at 10:59 AM on April 21, 2005

I'm always amused that those who lobby the loudest against hand-outs and preach about "pulling" and "bootstraps" often don't apply any of those ideals to their own family...

"incarceration is rehabilitation" also seemingly doesn't apply to them and their families.
posted by lord_wolf at 11:38 AM on April 21, 2005

I think one of the most remarkable things about the article is the fact that some of our founding fathers ended their lives deep in debt. Jefferson, Washington, who knows who else.
Now we have a contemporary america where many of us live as indentured servants to creditors. Some may say it's our own fault for putting ourselves in those situations, while failing to look at all the bait and switch policies and breakdowns in society that cause these situations to occur.
posted by mk1gti at 12:09 PM on April 21, 2005

Classic "Lying with Statistics" moment, troutfishing.
posted by Snyder at 3:07 PM on April 21, 2005

"At what point does great wealth held in a few hands actually harm democracy?"

As soon as you have a disparity in power, which is what wealth gives you, an attempted democracy is damaged. Its as simple as that.
posted by lerrup at 3:23 PM on April 21, 2005

lerrup - bada bing!

Of course it seems you can influence a crucial politician or small group of politicians for much less and thereby influence government.
posted by Smedleyman at 4:08 PM on April 21, 2005

Snyder - I'm not sure what your opinion is, but this topic has been discussed before on Metafilter :
posted by troutfishing at 8:47 PM on April 21, 2005

also - here's a bit of Metafilter discussion re : the US GINI, and the Lorenz curve.
posted by troutfishing at 8:53 PM on April 21, 2005

I don't care that you brought it up on metafilter before. The L-curve is a shitty graph. I'm no math genius, but even I can tell that it doesn't factor in population relative to income, and/or do what Gini does, which is count the cumulative shares of income. It can't tell you shit about income distribution. What it does is imply that the majority of income is in the hands of one person. It's a fraud, and designed solely to fool people into thinking the equality of income disruption is worse than it is. Gini is one thing, and worth looking at, (even with it's problems, which they talk about on the answers.com website,) but the L-curve is a waste of time at best.
posted by Snyder at 5:04 AM on April 22, 2005

Snyder, maybe this rough-but-scaled graphic of the figures I posted above, might be better.


posted by Gyan at 1:51 PM on April 22, 2005

Gyan, that's a much better graph, much clearer. It could do with the actual net worth numbers, but I understand it's a rough. I prefer the Gini coefficent, for this level of discussion, becasue I find it's easier to read than a graph, but at least the graph dosen't appear to be misleading.
posted by Snyder at 12:57 AM on April 23, 2005

Snyder, here are updated figures(PDF) with dollar figures:

For 2001,

Segment-----Size(# families)-----Share (%)-----Amount($, billions)
0-49.9-----46,500,000------------2.8------------1,175,7
50.0-89.9-----37,200,000-----------27.4-----------11,603.3
90.0-94.9------4,700,000------------12.1-----------5,139.9
95.0-98.9------3,700,000------------25.0----------10,615.2
99.0-100-------1,000,000------------32.7----------13,855.2
posted by Gyan at 10:40 PM on April 28, 2005

Rebuttal to Bruce Bawer
posted by jb at 7:04 PM on May 4, 2005