The more wealth inequality grows the less important 99% of the population is as consumers and the more important the 1% becomes.
Not as consumers, no. The 1% doesn’t consume more than the 90th percentile. They just park a higher percentage of their wealth in wealth-generating financial assets, which leech wealth from the rest of society.
We need a tax on all registered securities, (with exemption for the first $10 million owned by a natural person.) That tax should be paid not in cash, but in shares of the security: the IRS should slowly liquidate those shares over time, such that IRS sales never constitute more than 1% of total traded volume.
We further need the punitively-high top-tier tax rate we had for most of the 20th century. That tax rate pushed businesses to spend their excess income, turning it into other people’s paychecks. It discouraged the kind of wealth-hoarding investment that is stunting consumer spending.
Fredthefishlord@lemmy.blahaj.zone 3 days ago
You’re being incredibly over dramatic. Plenty of businesses thrive off of mostly middle or lower income customers.
Cities are just better. Rich or no rich, larger amounts of people means more restaurants and things to do.
gusgalarnyk@lemmy.world 3 days ago
I don’t think I am being over dramatic, I’d love to know what specifically you think isn’t grounded or reasonable.
Plenty of businesses do thrive off of the lower 90% of wage earners but those businesses are increasingly owned by the 0.1% and I’m talking about a slope here - a velocity. “Increasingly…” means there is a trend. When all wealth is increasingly owned by the wealthy 1% then we’ll see all possible wealth be within their immediate vicinity, within serving their needs. When there’s 50 businesses offering a service or product you can expect to see the wealth of those 50 companies spread out over many locations, but when all products and services are produced by 1 company you can expect most of their wealth to be situated in fewer places. Less competition means lower wages which means everywhere those workers are there is less wealth circulating. More wealth in fewer hands means less money flowing around to enliven cities, towns, villages.
More restaurants in cities because there’s more money in cities because there’s more people - but small towns used to have good restaurants too, with variety. But as wealth drains from the hands of the many into the hands of the few more corners have to be cut. More quality goes away. Another restaurant closes because people have to eat out less. It’s all a matter of how much wealth is in your community and owned by your community.
Things to do is facilitated by that same factor, but additionally by infrastructure. If the US had high speed rail connecting every major city and town, everyone would have a lot harder time justifying being within 30 minutes of city center by car when a train could take them into city center for cheaper, less hassle, and quicker from a much farther distance. We can’t build that infrastructure because… of a lot of reasons, but I’d argue most of them come back to too much money in the hands of too few people and that it’s only getting worse.
It’s why populism is so popular right now. It’s why the US is sliding rapidly into fascism. It’s why most European countries score as better places to live in nearly every metric, and it’s why if they’re not careful they’ll be in exactly the same situation in a few years time.
Wealth inequality is everything.
Fredthefishlord@lemmy.blahaj.zone 2 days ago
This part specifically is the what I was referring to. Basically, I feel as though you’re overemphasizing the “rich” aspect of why people live in cities. Tons of people just like being around other people.
The faster money flows, the more expensive jobs can be provided, and in the country side money moves slower. Wages being higher in cities isn’t because that’s where the rich are; it’s because there’s more places to spend money, so everything changes hands quicker and “creates” more money.(While I do think that plenty of modern econ is bunk bullshit, that’s one concept that rings true).
While I do agree that the rich kills small towns, I think it’s primarily a different reason—big box stores like walmart and medium boxes like dollar general using abusive price practices like undercutting using their wealth to push out the smaller competition, and make it nigh impossible for new places to get going.
Wealth inequality is quite meaningful, but I think it’s far from everything. There’s a lot of smaller reasons why cities tend to be better places to live, that don’t have to do with the rich.
One good example is that higher density means more gov $ per sqrmile, even if the people are poorer, and more infrastructure can be shared, making it cheaper to build. That results in cities inevitably having better infrastructure than the countryside
gusgalarnyk@lemmy.world 2 days ago
I think you’re misattributing things here that I think can and should be explained by wealth inequality. Big box stores don’t kill small towns because they destroy competition, they kill small towns because some percentage of money spent at a big box store leaves that small town. It’s not the lack of competition that kills small towns it’s the fact that after those small town businesses close less wealth exists in the hands of people in that small town. There’s less money moving around in that town because a portion of it is being siphoned off to big box store profits which go to shareholders and out of state C-suites and the likes.
Yes, higher density means more taxes are raised per area which means it’s easier to spend on infrastructure in high density areas but you’re missing the point. If wealth was distributed properly we’d have enough money to build all the infrastructure we want comparatively almost regardless of the density of the population. As wealth inequality grows less taxes are being paid to the government in high density and low density scenarios. As wealth inequality grows the more the government is in debt to the wealthy and the less it can spend on vital services. There’s enough money in the system to pay for Internet and hospitals and rail and school to service every person in the US but the money isn’t held by everyone, it’s held by people who have those services covered where they are and so they don’t care if they drain the rest of the country of those things. Wealth inequality explains why small towns are dying because it explains why they can’t afford to stay open, stay profitable, stay connected, stay healthy.
And to circle back around to your original paragraphs, I don’t care how much people like living in big cities they can’t live there on vibes alone. They have to go where the money is, and you best believe when Boeing opens up a new plant in a city they put a whole lot of money into that city (ignoring city special contracts for a moment). I like living in a big city, I want to move to an even bigger city, I’m not because I don’t have a job there right now. I live where the work is. And yes, denser cities means more jobs and more opportunities but that only gets less true and less meaningful the more wealth inequality grows. If I can’t afford to rent a flat in 10 years, the same way I can’t afford to rent a house today then what’s the point? If my job doesn’t pay me meaningfully more in 10 years because stocks have to go up (please read that as wealth inequality) then what’s the point? Cities don’t create jobs or high paying jobs because money moves fast, it’s because that’s where the wealth is. Look at any major city in the US (at least) and you can find the increasingly small list of increasingly massive companies that have offices there and you can trace the money. If Kansas city lost Garmin or Hallmark they’d feel it, if the government went further into debt and had to slash services Kansas City would feel it, if one of the massive freight companies left KC would feel it. The point is cities are built on wealth and the movement of wealth, but if it increasingly is drained out of those cities it will be harder and harder to sustain those cities. It won’t matter where people like living, they’ll have to move to where the money is.
I really do think looking at where money comes from and where it’s going is critical to understanding why the standard of living is declining while there’s never been more wealth or productivity in history. We could all own homes, all have healthcare, have highspeed rail, higher education, if only the rich didn’t exist. We have to tax them out of existence and build a system that works for the overwhelming majority of people instead of the 1%.