I mean, Mankiw's a smart enough guy but so are many shysters. The model of the world that it's a place that just rewards the smart and hardworking and punishes the undeserving is somewhat romantic, but it is not how the world actually is. Mankiw is venal, a servant of an ideology. He is almost a priest, a devotee of an economics that is more religion than science.

You do need luck. Decide not to go the party, don't meet the woman of your dreams. It's not like you'll meet her anyway. That was your one chance. Life is like that a lot.

That's what I'm getting at. Maybe this is just an elitist attitude if the arts were so important they would flourish without subsidies. Maybe some families really do think it's more important to keep more of their money so that their own kids can attend college instead of having X% taken out and distributed to stuff like the arts.

I mean I get the argument. Maybe we need some kickoff financing by people that are smarter than the rest/see things more clearly and then we can reap pretty big benefits. Better healthcare, education, arts/cluture, infrastructure the argument makes some sense in all those fields. My problem is that they require some Platonian superhumans that make choices. Essentially "do good fascism".
Because the argument does make some sense I try to keep an open mind. In fact I'm researching this a bit on the side under the umbrella of "innovation shocks". Theoretically speaking it's also not impossible that governments are sort of entrepreneurs that invest for social benefit or smth like that. I could make such a case decently well if I'd debate against some free market folks but I think there are enough objections to not concider it solid as of now.

The notion of "true value" is a strange concept for me. All value is subjective, sometimes subjective values align over big sample sizes but that isn't always a given. One man's trash is another man's treasure etc.
The knowledge problem is the main reason why I think free markets are preferable.

Sure there are some things. My claim is that they are currently overvalued by dogma. Other stuff falls through the cracks because of that.

No, I am fully opposed to socialistic solutions. I think socialism containing systems can land in a "reasonably good" local maximum but theoretically speaking I think pure free market systems are always superior.

My problem is that I can't ethically justify local maxima if I think there's better solutions out there. I probably could justify it if my ethics were different (i.e. Rawls-like) but alas they are not.

Of course you need luck, noone is debating that. My claim is that you vastly overestimate how far on the lucky side you need to be. Do you think people beating highstakes are mostly luckier than people beating small stakes? Do you think successfull bakeries or butcher shops are mostly luckier than the ones that go busto?

I happen to think more often than not the answer is no. They are simply better at what they do than others. The reason why they are better is often unclear to outsiders unless they dig in and try to understand it.

I also do think that it is absoltely legitimate to reward people that are better at what they do than others. And the flip site of that is that people who are not good at what they do should and need to be punished for it. Otherwise you're just bailing out bankers.

If life's like that a lot, then life as a whole is generally not like that. DUCY?

I am one of your "privileged white men".

Although I was raised in a middle class family, due to family issues I left home when I was 17. I got a job in a grocery store. After working there and quite often second jobs, I decided to go to college. I saved my pennies and got a job in another grocery store near school. I lived in a rathole, worked 40 hours stocking groceries all night (10PM - 7AM), then went to school during the day. I got no assistance from the government or anyone else including my family. I graduated cum laude and now have a professional career (I hate it but that's another matter).

Where I am now was due to hard work. Nothing else.

I got no head start. I think your stance is bs.

Wait don't you work for the government though or am I misremembering? :P

Right now. I've worked for 2 Fortune 500 companies as well as several consultant firms. I could easily work in the private sector.

sure biggerboat, but why should i be able to achieve that outcome with far less effort, just because i was lucky enough to have no family issues?

Or conversely, imagine how much better you could have done with that work ethic and the advantages that I had in growing up?

Why would you even bother thinking about that. If I was 2,2m tall I could have become a pro basketball player. I'm not.

It's a mistake to take individual anecdotal stories as strong evidence either for or against arguments about how much luck there is in being successful.

We're on 2+2, a forum for poker players. That much seems like it should be fairly well-explored ground here.

Monkey's premise was that unless you are born with silver spoon, you can't succeed. It's bs.

Anyone in this country can be successful on some level if they are willing to put the work in. I don't care what your background is.

I should probably stay out of this ridiculous discussion before I get banned.

geez, this guy is lucky

http://www.pri.org/stories/business/...sics-9870.html

Well, technically, to prove that all success ISN'T luck, we'd need to compile a bunch of $tats or whatever, not just "lol steve jobs though". I just assume that monkey is using some hyperbole and doesn't actually think that natural abilities and hard work don't count for anything ever. I think his point is that there are scenarios in which the impact of hard work and natural ability is dwarfed by environmental factors, and I think that's a fair observation, and it's not contradicted by the fact that some overwhelmingly large majority of people in the US can be reasonably successful with the right amount of effort.

Life is very complex and it doesn't seem at all unintuitive that while success, hard work, and natural talent are all correlated, there is not a direct causal relationship where everyone who succeeds is either smarter or worked harder then those that didn't succeed, and not everyone who fails owes their failure solely to lack of effort. Of course, accepting that argument doesn't necessarily lead to any conclusion that a society or a government should do anything about it. But I also think there's an intuitive argument that the stability of a modern society is undermined somewhat by excessive amounts of economic or social inequality, and that preserving stability is also in the self-interest of the very wealthy, enough so that there is a reasonable argument that they would willingly sacrifice some amount of wealth to preserve that stability, if they made decisions with perfect information. Obviously when I say it's intuitive I'm not trying to prove it, I don't think I can, and even if I could it would require something the length of a book. But the intuitive argument just follows from the idea that at some level of extreme inequality there would eventually be civil war.

edit: and to me, the rough outline of all of the above certainly leaves a tremendous amount of room within which to argue the pros and cons of various ways of trying to curb excessive inequality, or to promote social mobility, or provide for some baseline level of common welfare, or whatever. My opinions are somewhat boring because I don't actually think the system that the US has needs to be fundamentally changed, even though I think there are innumerable problems with it. The fundamental idea of representative democracy and regulated capitalism with some amount of state-run programs for the common welfare seems like a pretty good balance to me, from a very high level. ho hum

It doesn't seem intuitive at all that extreme inequality would lead to a civil war.

well, assuming that at some threshold of inequality, for some large enough percentage of the population, their perceived happiness-EV of violently opposing the established order exceeds the EV of not doing so, why wouldn't they?

I mean historically speaking wars and civil wars break out for all kinds of different reasons, and I'm oversimplifying, but there does seem to be historical evidence that even moderate amounts of economic discomfort felt by a large part of a society causes that society to seek to make changes in power structures. I mean that's what the whole "It's the economy, stupid" meme means in the US. And yes I'm extrapolating quite a bit from "people vote the out party" to "violent upheaval" but it's not like there isn't a long history of the latter in the world as well, and for a much longer period of time then the US has existed.

i think if those in power use their power in a way that is sufficiently inequitable, at some point they eventually get thrown out forcably, if other avenues fair to secure redress.

it strikes me as unlikely that things could get as extreme as that in a democratic society. OTOH, 1930s germany.

also, for the sake of the point I was trying to make, it's not even necessary to argue that some amount of inequality would necessarily lead to civil war, as if it were a logical necessity. That's not the argument. It only has to be perceived by the wealthiest that some level of inequality would make the possibility of social upheaval large enough, and the impact of that upheaval severe enough, in order for a completely self-interested evaluation of the situation to suggest the rationality of taking steps to avoid it. Of course the self-interested step they choose wouldn't necessarily have to be paying redistributive taxes. Maybe you just control all the guns and fighter jets or whatever. I'm guessing though that the former is actually cheaper and so the rational choice would not be to try for totalitarian rule.

and I'm purposefully trying to outline an argument solely from self-interest on the part of the wealthy because the argument about what is morally right is a lot less interesting, even though for me personally it probably has a greater impact on my particular beliefs

I was going to mention 1930 Germany as a possible example but I didn't want to Godwin myself, also I'm not an expert historian by any stretch

edit: 1930s germany not an example of civil war of course. just of pretty dramatic change brought about by civil unrest owing in some part to economic distress

i was only seeking to indicate that democratic systems can throw up extreme outcomes, not that mitt romney is actually like hitler.

Oh good thing the civil war was mentioned. Any thoughts by the US folks about my theory here:

The South couldn't have won long term no matter what they did. Their fate was sealed on the day West Virginia split from Virginia.

I'd want some input before I give my reasoning eventhough it's not superhard to guess it.

There's a decent argument to be made that "too much democracy" enabled/played a major role in Hitler's rise to power.

thanks. there's a lot less in this post that I'd argue against. we still obviously disagree on some fundamentals and I think you're wrong about how things "should" be valued.

I accept supply and demand because fairly valuing things is impossible but i think any reasonable system has to manually adjust supply and demand to, at least attempt to, approach true value, whatever that is.

I also obviously disagree about a free market having a better idea about valuing the arts and other abstracts to any degree of accuracy. and I think it will always undervalue. These things are all intuitive and I think even the most well-spoken and intelligent debater would have a tough time arguing this point definitively. What I think is indisputable (although I think you disagree) is that there are abstract factors and they are significant. Having a system which ignores them will just never last. Partly due to the comment well named makes below, re. civil war.

As for luck, some of the best poker players have admitted that a big factor in the success of the high stakes sickos was run good at the start of their career. There are countless sickos that just didn't make it because they ran bad at the onset and gave up. Variance is really tough to grasp in poker and there's even more variables in life. A life time is no where near enough time for luck to even come close to evening out. This is only exasperated over time. Your parents were unlucky, you start out needing even more luck and you have to workk even harder just to get by. and on and on.

big +1

Nobody reasonble will say that you can't make it from nothing. Of course you can work hard and succeed coming from nothing. and you deserve a big congrats! you're probably an outlier, though. Hate to burst your bubble but it isn't only that you're an outlier in terms of intelligence and work eithic.

good poast!

aside from civil war there's going to be an increase in crime in any system that allows cycles of poverty to exist unchecked. There's no simple solution to this, of course. handouts don't exactly solve poverty cycles.

What do you mean by the South winning long-term? I think it's pretty clear that the South had almost no chance of beating the North once the conflict started.

What I mean is that even if they can somehow drag on and keep it not lost for a longish time they still are doomed unless they can somehow capture West Virginia. I just recently stumbled upon a stat that I wasn't aware off before.

Love it