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Although I've looked at the original report, it isn't clear if this $1M in annual income that they're comparing to the 1950's is inflation adjusted. The only co

Although I've looked at the original report, it isn't clear if this $1M in annual income that they're comparing to the 1950's is inflation adjusted. The only comment I can find on this point appears to say that it isn't which makes it an unfair comparison because that's the equivalent of more than $13M today. The article avoids a bigger concern which is the size of government spending. In 1960 (I couldn't find older data) federal government spending was $144B. If we adjust for inflation, today's spending would be $1.6T. It's $9.7T. Perhaps the rich are paying less, but a government that increases spending by 6x is certainly contributing to the problem. Population has doubled size 1950 explaining some of the spending increases and spreading out some of the costs, but not all. It would be interesting to see if the number of "millionaires" has rise proportionally.

gruez 2y ago
> Although I've looked at the original report, it isn't clear if this $1M in annual income that they're comparing to the 1950's is inflation adjusted. The only comment I can find on this point appears to say that it isn't which makes it an unfair comparison because that's the equivalent of more than $13M today. So far as I can tell, they're not. See my sibling comment: https://news.ycombinator.com/item?id=40059084 https://news.ycombinator.com/item?id=40059084 For instance for the 1945 figures you can clearly see that they pulled the figures they pulled were for millionaires ("1,000 [in thousands] and over").
karmakurtisaani 2y ago
> Perhaps the rich are paying less, but a government that increases spending by 6x is certainly contributing to the problem. Just a side note, but government spending change makes more sense when measures against GDP, not just inflation adjusted raw numbers.
- notdonspaulding 2y ago
  I see this claimed all the time, but I don't understand why this is assumed to be the case. GDP rises and falls with economic progress and innovation. If new LLM startups make a bunch of money, GDP goes up accordingly. But government spending is primarily geared towards defense, infrastructure, and benefits/entitlements. What makes those costs go up proportionally to GDP? A fighter jet doesn't directly cost more because Amazon rolls out a new Alexa device, does it? America doesn't suddenly grow thousands of miles of new coastline because Google opens a data center in Iowa, right? If Rivian builds 10,000 new EV trucks, how much more interstate highway must be built? I would expect government spending to ebb and flow as market prices fluctuate, and I get that they might be loosely correlated, but why is spending assumed to be so closely linked that we should expect it to be a function of GDP? What's the intuition I'm missing?
  - karmakurtisaani 2y ago
    I can think of 2 reasons: * Managing a large economy is more expensive than a small one: for example creating legislation and managing a justice system for 100 companies is cheaper than doing the same for 10000 companies. * Tax revenue is typically more or less fixed percentage of GDP. The first point is something you can't really avoid without impairing the government. The second one you probably could with political decisions.

gruez 2y ago

> Although I've looked at the original report, it isn't clear if this $1M in annual income that they're comparing to the 1950's is inflation adjusted. The only comment I can find on this point appears to say that it isn't which makes it an unfair comparison because that's the equivalent of more than $13M today. So far as I can tell, they're not. See my sibling comment: https://news.ycombinator.com/item?id=40059084 https://news.ycombinator.com/item?id=40059084 For instance for the 1945 figures you can clearly see that they pulled the figures they pulled were for millionaires ("1,000 [in thousands] and over").

karmakurtisaani 2y ago

> Perhaps the rich are paying less, but a government that increases spending by 6x is certainly contributing to the problem. Just a side note, but government spending change makes more sense when measures against GDP, not just inflation adjusted raw numbers.

notdonspaulding 2y ago
I see this claimed all the time, but I don't understand why this is assumed to be the case. GDP rises and falls with economic progress and innovation. If new LLM startups make a bunch of money, GDP goes up accordingly. But government spending is primarily geared towards defense, infrastructure, and benefits/entitlements. What makes those costs go up proportionally to GDP? A fighter jet doesn't directly cost more because Amazon rolls out a new Alexa device, does it? America doesn't suddenly grow thousands of miles of new coastline because Google opens a data center in Iowa, right? If Rivian builds 10,000 new EV trucks, how much more interstate highway must be built? I would expect government spending to ebb and flow as market prices fluctuate, and I get that they might be loosely correlated, but why is spending assumed to be so closely linked that we should expect it to be a function of GDP? What's the intuition I'm missing?
- karmakurtisaani 2y ago
  I can think of 2 reasons: * Managing a large economy is more expensive than a small one: for example creating legislation and managing a justice system for 100 companies is cheaper than doing the same for 10000 companies. * Tax revenue is typically more or less fixed percentage of GDP. The first point is something you can't really avoid without impairing the government. The second one you probably could with political decisions.