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Date: Sun, 9 Sep 2007 22:08:44 -0400 (EDT)
To: James W Mickens <jmickens &AElig eecs.umich.edu>
cc: improvetheworld &AElig umich.edu
From: Daniel Reeves <dreeves &AElig umich.edu>
Subject: Re: mind the gap

Huge thanks to Melanie, Kevin, and Cam for responding to James better than 
I could.  The response I was working on is pretty much obsolete now, 
fortunately for everyone. :)

I'll just include one technical point below, but feel free to skip it 
because I think we've done a great job of getting to the heart of things.

I hope we're convincing folks that public policy aimed at redistribution 
of wealth is at least not to be done for its own sake.  Capitalism is at 
its core fair and the injustices, even if so big as to cast a shadow over 
the whole system, are nonetheless at the periphery and not the other way 
around.

Cam's last point really hit it home for me.  In my utopia, there would be 
only inheritance tax, property tax (major lightbulb moment for me there, 
Cam; thanks!), taxes on externalities (like pollution taxes), and revenue 
from selling public goods.  Maybe naive but I'm convinced it's the right 
direction to push towards.

Danny



PS: My stray technical point:

Wealth to which the daddy model applies (yes, I concede it exists!):
  * valuable stuff buried in the ground
  * land itself
  * the electromagnetic spectrum (for radio, tv, cell phones)
  * sunlight, air, rain, wind, oceans
  * roads, the internet

But it turns out those forms of wealth are already mostly distributed like 
a good daddy would.  Oil, for example, is a public good when it's in the 
ground and is auctioned off to companies so that we all get paid for the 
raw material that the oil companies end up with.

Now hold your quibbles!

Let's pretend we live in Japan which has few natural resources nor even 
much land per person. Yet it churns out as much wealth per person as 
Germany.

Side note: A lot of the wealth we consume is services and information 
goods, which has no raw materials component. And of the physical goods 
many can be made from nothing but oil and sand (plastic and silicon) which 
is dirt cheap compared to the final value of the goods.

Bottom line of this "technical point":  finite resources are not 
fundamental to this debate.


--- \/   FROM James W Mickens AT 07.09.08 17:32 (Today)   \/ ---

>> . . . in the real world, wealth I create in no way decreases your wealth, 
>> whether I'm turning my yarn into a sweater, turning my dirt and my seeds 
>> into food, learning how to remove a brain tumor, writing a book, etc.
>
> This is only true if the inputs to wealth generation processes are infinite. 
> If the precursors to wealth generation are scarce, then the action of 
> creating wealth can prevent someone else from maintaining their current 
> wealth level. Consider my corn example. There are multiple wealth generation 
> processes that require corn as input: livestock production, ethanol 
> generation, the creation of corn-based foodstuffs for humans, etc. Given a 
> finite supply of corn, the redistribution of corn inputs to the ethanol 
> sector (which leads to a subsequent boom in ethanol wealth) directly retards 
> the expansion of the livestock and foodstuff sectors, and makes it more 
> difficult for these sectors to maintain their current profit levels. This 
> hurts their prospects for wealth generation.
>
> Wealth generation might convert low valued inputs into high valued outputs, 
> but this does not mean that the inputs are limitless. Wealth creation is 
> often dependent on valuable resources that are highly contested. Thus, the 
> generation of a unit of wealth often implies a winner and a loser in a battle 
> over raw input. A new unit of wealth may eventually produce dividends for 
> everyone, but that is not what we're debating. We're debating whether your 
> wealth generation can negatively impact my wealth generation, and the answer 
> is yes.
>
>
> ~j
>

-- 
http://ai.eecs.umich.edu/people/dreeves  - -  search://"Daniel Reeves"

  I believe in making the world safe for our children, but not for our
  children's children, because I don't think children should be
  having sex.
    -- Jack Handey