Is America an Oligarchy?, asks John Cassidy (New Yorker 18 April 2014). He challenges what he calls the "alarmist" headline US is an oligarchy, not a democracy (BBC News 17 April 2014) reporting a recent study by Martin Gilens (Princeton University) and Benjamin Page (Northwestern University).
The study shows a small correlation between US policy and the opinions of the rich. No doubt this could be explained by the fact that the rich are more in touch with sociopolitical realities, which is probably one of the factors helping them to get rich in the first place. Correlation not causation? Yeah, right.
In any case, the supposed influence is asymmetrical. Even when the rich support some policy change, its chance of being enacted is less than 50%. But when the rich oppose some policy change, its chance of being enacted is less than 20%. Thus the rich appear to have an effective veto.
But a large veto is wielded by the political system itself. Only a small fraction of policy changes are enacted, and public opinion (whether majority or rich) doesn't make much difference. Obviously, the system itself doesn't like change. Now where have we heard that before?
Martin Gilens and Benjamin Page, Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens (forthcoming Fall 2014 in Perspectives on Politics)
Showing posts with label wealth. Show all posts
Showing posts with label wealth. Show all posts
Sunday, April 20, 2014
Saturday, March 22, 2014
The Purpose of Wealth
Marc Benioff has a message for his rich tech friends: "Give back or get out". (San Francisco Magazine, 19 April 2014)
One man obviously doesn't need this message. "Bill Gates, the richest man in the world, has told a conference his children will not be left billion-dollar trust funds, despite [his] having amassed a personal fortune of $76 billion (£46 billion). The Microsoft founder was speaking at a TED conference in Vancouver when he announced that most of his wealth will instead be left to the family's charitable organisation, The Bill and Melinda Gates Foundation. The charity works to improve health care, education and reduce extreme poverty around the world." (The Independent, 20 March 2014).
Interviewed at the same conference, Larry Page outlined an apparently different idea about the purpose of wealth. Asked about a sentiment that Page had apparently voiced before that rather than leave his fortune to a cause, that he might just give it to Elon Musk. Page agreed, calling Musk’s aspiration to send humans to Mars “to back up humanity” a worthy goal. “That’s a company, and that’s philanthropical,” he said (Wired, 19 March 2014). In Business Insider, this story is headlined as "I’d Rather Leave My Billions to Elon Musk Than to Charity" (Business Insider 19 March 2014, Slate 20 March 2014).
But surely Musk’s aspiration to send humans to Mars is a cause. And as Page understands the word, it is a "philanthropic" cause. He presumably doesn't want to give lots of money to Musk just so Musk can set up trust funds for his own children.
I have no idea whether Page actually believes what he says in public about charity. Obviously rich people like Gates and Page have an endless queue of optimistic people asking for money for this or that charity. One way of managing this queue is to set up a Foundation, and refer all requests to this Foundation. Another way is to put on a public show of disdain for charitable causes.
Technology entrepreneurs sometimes compete to display their philanthropic credentials. In a recent interview, Marc Benioff expressed scorn about a large donation by Mark Zuckerberg, and hinted that this was merely a politically motivated tax write off.
Where’s it gone? What good is it doing now? What are his targets? What are his philanthropic interests?
If Page wants to give his money to a company, the obvious choice would be Google itself, There are precedents for a company founder to give his shares back to the company and/or its employees in perpetual trust. Google could then invest the cash in a number of interesting and even "philanthropic" ways. Such as buying into Musk's company (Tesla Motors).
Indeed, Google's much mocked slogan, "don't be evil", would imply that all Google's cash should be invested in missions that Page would regard as "philanthropic". But then I can hear the unmistakeable voice of the late Tony Benn asking Larry Page five questions:
What power have you got? Where did you get it from? In whose interests do you exercise it? To whom are you accountable? And how can we get rid of you?
This post was originally written in March 2014 about the difference between Bill Gates and Larry Page. Updated 19 April 2014 to include the difference between Marc Benioff and Mark Zuckerberg,
See also Andrew Leonard, Tech titan throws some shade at Mark Zuckerberg (Salon 17 April 2014)
One man obviously doesn't need this message. "Bill Gates, the richest man in the world, has told a conference his children will not be left billion-dollar trust funds, despite [his] having amassed a personal fortune of $76 billion (£46 billion). The Microsoft founder was speaking at a TED conference in Vancouver when he announced that most of his wealth will instead be left to the family's charitable organisation, The Bill and Melinda Gates Foundation. The charity works to improve health care, education and reduce extreme poverty around the world." (The Independent, 20 March 2014).
Interviewed at the same conference, Larry Page outlined an apparently different idea about the purpose of wealth. Asked about a sentiment that Page had apparently voiced before that rather than leave his fortune to a cause, that he might just give it to Elon Musk. Page agreed, calling Musk’s aspiration to send humans to Mars “to back up humanity” a worthy goal. “That’s a company, and that’s philanthropical,” he said (Wired, 19 March 2014). In Business Insider, this story is headlined as "I’d Rather Leave My Billions to Elon Musk Than to Charity" (Business Insider 19 March 2014, Slate 20 March 2014).
But surely Musk’s aspiration to send humans to Mars is a cause. And as Page understands the word, it is a "philanthropic" cause. He presumably doesn't want to give lots of money to Musk just so Musk can set up trust funds for his own children.
I have no idea whether Page actually believes what he says in public about charity. Obviously rich people like Gates and Page have an endless queue of optimistic people asking for money for this or that charity. One way of managing this queue is to set up a Foundation, and refer all requests to this Foundation. Another way is to put on a public show of disdain for charitable causes.
Technology entrepreneurs sometimes compete to display their philanthropic credentials. In a recent interview, Marc Benioff expressed scorn about a large donation by Mark Zuckerberg, and hinted that this was merely a politically motivated tax write off.
Where’s it gone? What good is it doing now? What are his targets? What are his philanthropic interests?
If Page wants to give his money to a company, the obvious choice would be Google itself, There are precedents for a company founder to give his shares back to the company and/or its employees in perpetual trust. Google could then invest the cash in a number of interesting and even "philanthropic" ways. Such as buying into Musk's company (Tesla Motors).
Indeed, Google's much mocked slogan, "don't be evil", would imply that all Google's cash should be invested in missions that Page would regard as "philanthropic". But then I can hear the unmistakeable voice of the late Tony Benn asking Larry Page five questions:
What power have you got? Where did you get it from? In whose interests do you exercise it? To whom are you accountable? And how can we get rid of you?
This post was originally written in March 2014 about the difference between Bill Gates and Larry Page. Updated 19 April 2014 to include the difference between Marc Benioff and Mark Zuckerberg,
See also Andrew Leonard, Tech titan throws some shade at Mark Zuckerberg (Salon 17 April 2014)
Tuesday, February 10, 2009
Bank Bonuses
Why is it a good idea for banks to pay bonuses to their employees, when there seems to be a severe shortage of funds needed by real businesses to survive?
For many years, the banking industry has attracted many of the cleverest young people from the top schools and universities, and assigned them to playing transiently profitable number games. We are now told that the banks must continue to pay large bonuses to these people, so that their talents are retained within banking.
The apparent purpose of these bonuses is to perpetuate a discredited system, in which a significant pool of intelligence is still being denied to the industries that might actually create real wealth. Where would they go instead? Fields, factories and workshops perhaps?
Some cynics suggest that the current bank employees are so damaged by their experience, that letting their talents loose on wealth-creating industries would cause further economic and social catastrophe.
However, it would be a disgrace if new generations of bright students continued to be lured into gambling with other people's money by the prospect of high bonuses and zero accountability.
Perhaps we should get the bankers to do some real banking - along with hedging and ditching. See Somerset Guide to Restoring Hedgerows (pdf).
For many years, the banking industry has attracted many of the cleverest young people from the top schools and universities, and assigned them to playing transiently profitable number games. We are now told that the banks must continue to pay large bonuses to these people, so that their talents are retained within banking.
The apparent purpose of these bonuses is to perpetuate a discredited system, in which a significant pool of intelligence is still being denied to the industries that might actually create real wealth. Where would they go instead? Fields, factories and workshops perhaps?
Some cynics suggest that the current bank employees are so damaged by their experience, that letting their talents loose on wealth-creating industries would cause further economic and social catastrophe.
However, it would be a disgrace if new generations of bright students continued to be lured into gambling with other people's money by the prospect of high bonuses and zero accountability.
Perhaps we should get the bankers to do some real banking - along with hedging and ditching. See Somerset Guide to Restoring Hedgerows (pdf).
Wednesday, January 21, 2009
Female Pleasure 3
A controversial study claims that a woman finds lovemaking more fulfilling if her partner is wealthy. Wealthy men give women more orgasms (The Times, 18th January 2009) Why rich men are better in bed: Women have more orgasms with wealthy partners, study finds (Daily Mail, 20th January 2009).
Another bit of pseudo-science from the evolutionary biology brigade.
The study is based on a survey of some 1500 Chinese women, and appears to show some statistical correlation between prosperity and pleasure. Here are some of the possible explanations discussed by the Daily Mail, a paper popular with women who have (or would like to have) wealthy partners.
- Women who have frequent orgasms tend to overestimate their partner's income
- Women with 'high powered' partners exaggerate how much they enjoy sex
- Women who are highly susceptible to orgasms select partners who are wealthy
- More desirable mates cause women to experience more orgasms
In evolutionary biology, the game is always to find an explanation that shows how some trait has evolved to yield some reproductive advantage. Thus Thomas Pollet, who has just completed a PhD at the Center for Evolution and Behaviour at Newcastle University, speculates that a woman's 'capacity for orgasm' could have evolved to help her discriminate between males on the basis of their quality. In an earlier paper, Sexual Selection as a Mechanism for Conspicuous Consumption (pdf), Pollet implied that women discriminated between mates on the basis of leisure activity and expensive gifts, so his views have obviously matured with experience.
Note that the Daily Mail mostly prints explanations based on female choice, because this flatters its female readership, and overlooks explanations based on male choice - for example, rich men choose randy girlfriends and dump them if they stop being randy. I'm not saying that this explanation is any better than the ones the Daily Mail prints, I'm just saying that the Daily Mail is being selective about the rubbish they print.
In contrast, The Times gives wealthy men the credit for "giving" women more, and interprets Pollet's findings as "suggesting that women are inherently programmed to be gold-diggers". Obviously pandering for a male readership then.
Finally, in the comments to the Daily Mail article we can find a more down-to-earth explanation. "There is nothing like money worries to dampen your sex drive." (I think there is something in one of George Orwell's early novels about this effect, but I can't seem to find it.)
Update
Just found an excellent blog called Lust in Paradise, making similar points to mine. It concludes as follows."The point is that studies like this one are conducted in a socio-economic context that simply did not exist in prehistory, when all this evolving supposedly took place. Yet the central conceit of mainstream evolutionary psychology is that these findings reflect some eternal truths about men, women, and the allocation of resources. The fact that there's a gaping hole in the center of their narrative doesn't stop them telling us what female orgasms are saying though..."
See also post by
Thursday, May 22, 2008
Social Mobility
A hundred years ago, there was comparatively little social mobility. Among the working classes there were many people with high levels of ability - intelligence, initiative and confidence; meanwhile, the upper classes were stuffed with idle dimwits. The First World War was characterized by thousands of pointless deaths, ordered by chinless wonders.
Over the past sixty years, many able and hard-working individuals from unprivileged families have attained social status and economic prosperity. Meanwhile, some formerly wealthy families have slipped down the socio-economic ladder, as a result of folly or misfortune.
As a result of this increased opportunity for social mobility, the distribution of power and wealth, although far from perfect, is perhaps very slightly better aligned to merit than it had been. And although there are many injustices and anomalies, with too many arrogant idiots in powerful positions, and there is still discrimination against talent in some areas, society has undoubtedly benefited from taking its leaders from a much broader pool of talent, women as well as men.
The question now arises - is there an unlimited supply of talented people in the under-privileged sectors of society? Should we expect levels of social mobility to remain constant? Should we expect mediaeval institutions like the British Army, Oxford and Cambridge Universities, the House of Commons, the BBC and Northern Rock to take a fixed proportion of their intake from under-privileged sources?
Meanwhile, the people who climbed the ladder fifty years ago might wish to pull the ladder up behind them, making sure that their own bright and beautiful children and grandchildren get to the front of the queue for the best universities and the best jobs. However, since some of these parents got where they are today by ability and hard work, as well as good fortune, it is just possible that a few of these children might be pretty talented anyway.
I have no doubt that there are still many able and hardworking people from underprivileged backgrounds, who could play an extremely valuable leadership role in society, and I have no wish to discourage them or deny them the opportunity to fulfil their potential. But given the large number of able and hardworking people who have already moved from the working classes into the middle classes, it is possible that the amount of potential talent remaining in the working classes may be slightly less than it was a generation or two ago.
It is also conceivable that ability and hard work are socially determined. Indeed, one of the reasons why well-off parents send their children to expensive schools is because they believe that this will provide an environment in which hard work is rewarded, thereby bringing out their children's latent ability.
Actual social mobility may be clustered - it may make sense for waves of talented people to move upwards together, as they did in large numbers into many professions after the Second World War. Clustering may not be fair to everyone, but it may produce satisfactory outcomes for large numbers of people.
So this is a complex and highly charged political topic, which touches some raw nerves on both sides of the political spectrum. Enter one brave academic: Bruce Charlton, who is Reader in Evolutionary Psychiatry at the University of Newcastle upon Tyne, has recently suggested that the low numbers of working-class students at elite universities was the "natural outcome" of IQ differences between classes.
I have not seen the evidence from which Dr Charlton draws this conclusion, and I have been careful not to make any such sweeping assertions myself. All I wish to say here is that social mobility is a more complex phenomenon than most politicians are willing to admit, and that educational policy based on a over-simplistic and linear notion of social mobility and distributive justice may be fundamentally flawed.
Update: New evidence is being published to show how the professions are increasingly "reserved for the rich". [BBC News, 21 July 2009]
Over the past sixty years, many able and hard-working individuals from unprivileged families have attained social status and economic prosperity. Meanwhile, some formerly wealthy families have slipped down the socio-economic ladder, as a result of folly or misfortune.
As a result of this increased opportunity for social mobility, the distribution of power and wealth, although far from perfect, is perhaps very slightly better aligned to merit than it had been. And although there are many injustices and anomalies, with too many arrogant idiots in powerful positions, and there is still discrimination against talent in some areas, society has undoubtedly benefited from taking its leaders from a much broader pool of talent, women as well as men.
The question now arises - is there an unlimited supply of talented people in the under-privileged sectors of society? Should we expect levels of social mobility to remain constant? Should we expect mediaeval institutions like the British Army, Oxford and Cambridge Universities, the House of Commons, the BBC and Northern Rock to take a fixed proportion of their intake from under-privileged sources?
Meanwhile, the people who climbed the ladder fifty years ago might wish to pull the ladder up behind them, making sure that their own bright and beautiful children and grandchildren get to the front of the queue for the best universities and the best jobs. However, since some of these parents got where they are today by ability and hard work, as well as good fortune, it is just possible that a few of these children might be pretty talented anyway.
I have no doubt that there are still many able and hardworking people from underprivileged backgrounds, who could play an extremely valuable leadership role in society, and I have no wish to discourage them or deny them the opportunity to fulfil their potential. But given the large number of able and hardworking people who have already moved from the working classes into the middle classes, it is possible that the amount of potential talent remaining in the working classes may be slightly less than it was a generation or two ago.
It is also conceivable that ability and hard work are socially determined. Indeed, one of the reasons why well-off parents send their children to expensive schools is because they believe that this will provide an environment in which hard work is rewarded, thereby bringing out their children's latent ability.
Actual social mobility may be clustered - it may make sense for waves of talented people to move upwards together, as they did in large numbers into many professions after the Second World War. Clustering may not be fair to everyone, but it may produce satisfactory outcomes for large numbers of people.
So this is a complex and highly charged political topic, which touches some raw nerves on both sides of the political spectrum. Enter one brave academic: Bruce Charlton, who is Reader in Evolutionary Psychiatry at the University of Newcastle upon Tyne, has recently suggested that the low numbers of working-class students at elite universities was the "natural outcome" of IQ differences between classes.
I have not seen the evidence from which Dr Charlton draws this conclusion, and I have been careful not to make any such sweeping assertions myself. All I wish to say here is that social mobility is a more complex phenomenon than most politicians are willing to admit, and that educational policy based on a over-simplistic and linear notion of social mobility and distributive justice may be fundamentally flawed.
Update: New evidence is being published to show how the professions are increasingly "reserved for the rich". [BBC News, 21 July 2009]
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