from Hacker News

Economist Says Most of Billionaire Wealth Is Unearned

by elberto34 on 3/13/17, 2:49 PM with 16 comments

• by jonasvp on 3/13/17, 3:22 PM

  This has been espoused a long time ago by German economist/trader Silvio Gesell: https://en.wikipedia.org/wiki/Silvio_Gesell

  His main work is about reducing the possibility to extract "rents" from society by closing loopholes in our current economic system:

  1. Money is "better" than everything else so those holding money can extract surplus value by lending it out. This was later also found out by Keynes and others. Keynes' solution: inflation. Gesell's solution: imposing carrying costs on cash.

  2. Land is required by everybody yet impossible to increase. Solution: the goverment is owner of all land yet leases it out long-term by auction. All income is distributed among all mothers, since the price of land is direct consequence of the number of children/people in a country. Now you would distribute it among all citizens and call it "basic income".

  His ideas are still completely valid and deserve a wider audience.

• by throwaway2016a on 3/13/17, 4:10 PM

  I'm not a billionaire, but I hope to someday have most of my new wealth "unearned". Otherwise it will be very hard to retire.

  If I do ever get to the point where I have enough unearned income to cover all my living expenses I plan to put it to good work.

• by cryoshon on 3/13/17, 3:21 PM

  i really wish people would just read some pikkety, which explains conclusions like the above.

  the movement of wealth has a speed and a vector. all wealth moves along the path of least resistance, which means wherever it can move at high speed.

  the more wealth at one node (an individual) is concentrated, the faster wealth moves toward that node, and thus it follows that the faster wealth moves toward one node the slower it must subsequently move in all future directions because there are substantially fewer people who have even greater wealth than the node. this means that all capital flows ultimately point to the richest of the rich, although there are a lot of other rich people who are enriched along the way.

  rents are just a steady drumbeat of wealth moving from those with the least wealth of all nodes (proliterians) toward the middle or higher rung of nodes.

  "unearned" is the wrong word. "structurally guaranteed" is a better term.

• by qeternity on 3/13/17, 3:12 PM

  This author has conflated a lot of concepts behind a very ideologically driven thesis. At best, they have confused "rents" with "producer surplus".

• by ianai on 3/13/17, 3:30 PM

  If advertising aids your revenue then you're operating as a monopolist or oligopolistic. In either situation you're outputting less than optimal, extracting rent, and society loses out through waste. Billionaires have accumulated a lot of inefficient rent.

• by floatboth on 3/13/17, 3:12 PM

  Most of Billionaire Wealth is Unearned. In Other News, Water Is Wet.

• by refurb on 3/13/17, 3:09 PM

  It seems like "rents" has become the latest political buzzword. I see it used incorrectly to label something as "bad", but it makes the person using the word sound educated and sophisticated.

  It's losing it's impact.