The rich aren't your role models

The rich aren't your role models(theslowburningfuse.wordpress.com)

156 points by Refreeze5224 17 days ago | 57 comments

mrtomservo 17 days ago |

I wonder if unchecked capital accumulation combined with cutting the social safety net and major public works will lead to commerce without customers: An economy built on consumption where nobody has the money to consume.

fzeroracer 17 days ago | |

This is what people have been speculating will happen with the rise of the K-shaped economy. An economy where a smaller and smaller number of consumers are responsible for more and more of consumption.

I think the problem is a sort of self-correcting one though because when the cuts start to bleed deep enough that people can no longer afford food or basic amenities that's when people start to get violent. Unfortunately that also tends to be very bad for economic outcomes.

Ferret7446 17 days ago | | |

That premise is kind of false though. Food stamps are very generous, much to the chagrin of the borderline tax contributors.

I think we'll just see benefits slowly ramp up until most people are on benefits, with lots of consternation around government waste along the way.

AndrewKemendo 17 days ago | |

It’s all moving to a service economy for the wealthy as the only consumers.

You can see this most dramatically in Las Vegas right now: https://m.youtube.com/watch?v=LHwU4lQ46nA

anon291 17 days ago | | |

This is because America builds nothing anymore. Consider Disneyland. It's expensive as hell. But also there are more people in America than ever. You'd think they'd have built another one, but they haven't. Why?

YZF 17 days ago | |

There is no economy without customers/consumption. Elon Musk's SPCX are worth zero if nobody wants to send anything to space and nobody can send anything to space if nobody has any money. Debt can fuel consumption to some degree but that has limits. Capital accumulation on its own does not impact the economy. You can put the number $10000000T against Elon's name and it will not change the economy at all. What changes the economy is how this money is deployed. Economies are not zero sum games and money is not a fixed quantity. That's not to say this is meaningless but it also doesn't mean that Elon now has your dollars.

sharemywin 17 days ago | | |

a large % of wealth is a made up number. if everyone runs to the door to sell an asset it becomes close to worthless pretty quickly.

bxk76 17 days ago | |

No commerce going on when the trillion cells inside your body interact. Yet more energy is consumed by the brain.

tim333 17 days ago | |

It's unlikely because governments actively try to avoid that even if it means printing money. Also commerce needs customers or it fails.

Screw ups where that kind of thing has happened like the Irish potato famine, which was mostly a result of crap British governance are mostly avoided these days.

boznz 17 days ago |

Neither are the politicians, or the influencers, or Hollywood, they all have an end-game, a message or something to sell, none of these people are better than you, yet people pick someone and agrees with everything they say.

The world has lost the ability to critically think.

Rzor 17 days ago | |

>The world has lost the ability to critically think.

Bold of you to assume it ever did.

dataflow 17 days ago |

Mostly off-topic, but I've wondered, is there a measure of wealth that involves first liquidating everything? And what is that for Musk? I don't find it meaningful to say someone has a net worth of $X if they can't actually liquidate their assets and pay off their liabilities to produce $X.

YZF 17 days ago | |

Presumably Elon can borrow a lot of money against his paper money. That would be more typical than trying to liquidate. But yes, there is no way he can actually fully cash out on his net wealth, and he probably wouldn't even know what to do with it if he could.

recursivecaveat 17 days ago | |

It's usually not that different from just amount * marginal market value, such that its not generally worth worrying about the distinction. The main reasons you can't dump 1 trillion dollars of stock at once is it would be difficult to find enough buyer capital quickly, and announcing your intention to do that is going to drop the price as you're implying an overvaluation.

Both of those problems can be solved if you just do it slowly in a pre-announced manner. A trillion is a thousand billions, so you could cash out 1 billion dollars annually until the 30th century assuming zero growth/inflation. So unless you're really worried about the optics of selling 0.1% of your holdings, or plan to spend more than 1 billion a year outside your business, you're not really constrained.

Everything is liquid in a long enough time horizon. It just depends on what you mean by liquidating. Like do I have to sell my house today? In a week? Months? More flexibility = more value.

For Musk the situation is definitely more extreme though. Since a significant part of that valuation is attached to him owning it, he would definitely take an abnormal level of haircut. Probably an unknowable investor sentiment question though.

ggm 17 days ago |

I enjoyed seeing this refer to the Phaistos disc, because I have just come back from Heraklion and saw it in the flesh (clay)

A reminder that deciphering Linear B was the work of a number of people and a brilliant book by John Chadwick discusses the statistics, and the application of numerical/statistical methods to the analysis That Chadwick and Ventris used, from the ground breaking work of Alice Klober.

The problem with Linear A and the Phaistos disc, is that there isn't enough material to apply these kinds of methods. I believe most Linear A is tally records.

fzeroracer 17 days ago |

I wonder what it would take to shake America of the whole 'temporarily embarrassed millionaire' problem.

At this point I assume even a hard economic crash pioneered and gleefully supported by the rich isn't enough of a cold water splash. I think that mentality is too locked in for a large subset of Americans. Musk has been increasingly getting more and more rancid and that doesn't seem to deter his supporters at all.

happytoexplain 17 days ago | |

Nothing short of mass violence, which should not and will not happen. I.e. we're absolutely fucked in the foreseeable future. Maybe in a century something massive enough will happen, god help those living at the time.

derektank 17 days ago | |

One doesn’t have to imagine themselves a future millionaire to be wary of granting the state the ability to confiscate private property. There’s a very real risk that they’ll come for the modern equivalent of the kulaks next.

archagon 17 days ago | | |

Americans: terrified of an imagined threat, completely oblivious to the active threat right in front of them.

fzeroracer 17 days ago | | |

This would be fair...except said wary individuals have had zero problem giving the state the ability to confiscate private property as long as it appeals directly to their emotions. We've seen cheers from those same types as the government sends jack-booted thugs to kick in doors and destroy property.

Empact 17 days ago | |

Leftists ask “why don’t Americans hate capitalism,” while Americans live in one of the most prosperous and advanced societies in the world.

text0404 17 days ago | | |

Unfortunately, leftists rely on Americans ability to empathize with the plight of the vassal states in the world which have been pillaged and destroyed in service of the most prosperous and advanced societies. It is obvious at this point that Americans do not have empathy and will gladly accept the state of the world as long as they don't have to witness the injustice of it.

amai 17 days ago |

Who are your role models?

YZF 17 days ago |

What matters isn't Elon Musk (or any other person's) net worth. What matters is how this money is being deployed. If Elon has $1T in his basement and he's not doing things with this money then the net outcome is the removal of this money from the economy which is deflationary - makes your money go farther. If Elon invests it in things that produce broader value (e.g. create jobs, improve productivity, etc.) then it can be a net positive. It's not about the amount- it's about how it is deployed. One rich person (or country e.g.) can be your "oppressor" (more likely in non-democratic countries) and another could be your benefactor.

Making money is the incentive we have in capitalism for individuals to create value. Capitalism isn't perfect but it's the best system we know of. In systems where we don't allow people to become rich (in theory) we typically produce less value and end up with most of the value concentrated into one dictator (e.g. Russia, China, Saudi Arabia). We can argue about taxation etc. but fundamentally this is the system that has proved to be the best for everyone. We can argue about checks and balances as well but again in practice having rich people and western democracy correlates with better outcomes for everyone historically. If you propose we get rid of this system you need to make a reasonable argument for an alternative that is better. If you're arguing that life isn't always fair and luck plays a role- well yeah.