Quote Originally Posted by Adam Strange View Post
It's surprising to me that Trump's election has made lying, meanness, racism and naked avarice publicly acceptable. It's like pulling back the sheets on a bed in a five star hotel and finding spiders and bugs crawling everywhere.

I think there is a reservoir of this stuff in the population which is normally held in check when people feel that their situations are improving. They might be authoritarian racists, but they won't come out and say it unless their status is threatened.

At this point in the world economy, the future status of quite a few people is threatened.

There are really two economies. There is the one in which you can make productivity increases, like farming, manufacturing, and delivering entertainment. There is another economy in which it is much, much harder to increase productivity, like string quartets (try doing that with fewer than four people), caring for people one-on-one, teaching, and cleaning and maintenance services.

As capitalism drives the economy to greater profits through greater efficiencies, one of these economies benefits by having fewer workers who are able to produce more stuff, and the other economy doesn't benefit at all. The first tends to be private industry in the US, and the second tends fall under the responsibility of governments, which deal with providing essential services to their citizens that private companies won't provide because there is no profit in them, or because the services are essential and government can provide them cheaper or better (such as police forces) than private industry, which has to make a profit.

This means that, as time goes on and productivity in the private economy grows, fewer and fewer people will be needed in these highly productive jobs, and more and more people will find themselves looking for work in the part of the economy which is not very productive and hence doesn't pay very well. For these people, wages will be frozen or will fall, and their future prospects will be bleak unless they can somehow get into the productive economy.

Colleges, which are really profit centers, see that they are gatekeepers to the productive economy and have been raising tuition as fast as they can. College tuition, which was free to millions of returning veterans after WWII (which resulted in a highly productive, debt-free work force which made the economy boom for twenty years), now costs as much as a new house, and houses cost more than they ever have before.

Because the enormous gains in productivity no longer have to be distributed to a huge number of workers, they are now free to be turned over to the company shareholders who use them to bid up the price of assets, like stocks and housing, instead of being returned to the general population to make a large number of people wealthier.

Unless this wealth is taxed much more heavily (remember that these profits are only able to be made because the corporations operate within an area made safe for them by specific laws which are enforced by the governments of the people), then the distribution of wealth is simply going to become more and more unequal.

Soon, there will only be royalty and peasants, and I don't see this trend reversing, unless there are much, much higher taxes placed on the wealthy.

Furthermore, since political power is a function of wealth, this trend of increasing inequality in wealth bodes very ill for democracy.
The two economies you speak of are usually referred to as prodution vs services. You say that most services are provided by government, and while many are, many others such as grocery stores, are privately owned.

It's a technicality, but it needs to be pointed out.

As far as the rich being taxed more, an argument people often throw around is that we need to increase taxes on the wealthy so the government will have more money. But tax revenue and tax rate are two different things*. You can lower taxes and have the government earn more in revenue, or less in revenue, depending on how the economy responds to the tax cuts. This was the basis of Reagan's massive tax cuts.

I do think Reagan's tax cuts, while not harmful to the federal government's income (since tax revenue didn't actually go down despite said cuts) did create extreme gaps in wealth. You are right, the only way to have less wealth gaps is to tax the wealthy more, but how do sell that without an "eat the rich" mentality going along with it? Since the tax revenue of the US federal governement hasn't gone down or up much since the 1950s, despite radical changes in the tax rate (for income and capital gains taxes), you can't really sell it on (during elections) the basis of the government having more money (well you could sell it on that, but it would be a lie, though most people are quick to believe and slow to research so it could work, just that at the end of the day you'd still have to account for the revenue not going up).

So the only way to argue in an honest fashion that you want more tax cuts is that the rich have too much money, mainly because it shouldn't be allowed to have that much money not because the government needs more money. I am not one fo the rich at all but something about that logic seems off to me.

*https://en.wikipedia.org/wiki/Laffer_curve