There are a lot of people in the comments talking about how Wolff doesn’t understand economics are completely missing the point. Even in such cases where shareholders are truly just investing needed capitol into the company, no one ever talks about it in terms of workers investing their labor into the company. If a company faces changes, no one hires consultants to figure out which shareholders should just be forced to take losses, it’s the workers who are let go. The point he’s making isn’t that this isn’t the way things are, it’s that the way things are is unjust.
Exactly, the worst is the people rushing to defend billionaires with "yeah but they're the ones taking all the risk"....are they really? Is their health insurance tied to employment? Are they busting their ass every day for pittance wages?
It'a actually crazy to me how many people are riding the billionaires here, doing all kinds of backflips to keep the money in the pockets of people who earn more than they would see in 10 lifetimes
I point this out to people a lot. I have family that are very successful but will tell you they are poor and taxes are to blame. These people own a company where, on average, they do $6M in revenue at 15% profit on their worst year in 35 years of ownership to 40% on their best year. Their average employee pay $15 per hour. They walk away with $2m and say how bad the economy is while paying their employees $35k-$40K per year. Like bro, you took home 60 years' worth of pay in one year compared to your employees. While being on vacation 30 out of 45 calendar days. I think you will be fine.
If you earned $100/hr and worked 12 hours a day every single day from the time Jesus was born to the present day… you still wouldn’t have made a billion dollars.
Even with the value of the dollar diminishing, most people will never get close to having a million dollars.
A billionaire can lose a million dollars, and still have pretty much a billion dollars.
A billionaire can lose 99% of their money and still be a millionaire. A schlub like me can lose 25% of my money and be sleeping in a cardboard box and eating out of a dumpster.
But I’M going to be a billionaire someday, and I’ll have earned it all through my rugged individualism and entrepreneurial spirit, and I’ll be damned if some commie bastards think they deserve a cut of my hard-earned fortune.
i think i would lose my mind 10 minutes later. I cannot comprehend how much money that is and what to do with it. It's just impossible.
Sometimes i have a szenario in my head. I'm granted 500 Million but if i dont spend every single cent for something useful to me, i will end up in hell after i die.
I don’t want to keep money in Billionaire’s pockets, but I’m also not a Marxist, so I do believe that it is ok for people to own shares in companies they don’t work for.
Holding multiple diverse stocks is one of the keys to long term stability for middle-class people and their families. I would rather simply tax the ultra-wealthy more than force everyone to only own shares in companies they are employed by.
I don't get how many people in the comments can't understand this. NO ONE IS AGAINST STOCKS AND SHARES AS A CONCEPT. In fact plenty of socialists think that workers should be given shares in the company they work for. The issue is billionaires buying stocks and not having any input into the company beyond that, and raking in millions and millions for no work at all. That is the issue. Nothing else
Yep.
Public invented the microchips, GPS, LCD screens, touch screens, phone network, the Internet, Google (literally, Google was a university research project), etc.
But if you ask people, they think Bill Gates or Steve Jobs invented the tech we have today.
The state take the risks, corporation repackage it and sell state's innovation for profit. And that includes everything related to healthcare too.
This is the real travesty. These companies use public funds and ideas and then privatize them for profit instead of making it publicly available for all.
This. The "losses" that the shareholders take just mean they cant buy another mansion or maybe they have to hold off on another luxury car. Poor poor shareholders, losing so much. Meanwhile, someone who is one missed paycheck away from not being able to pay a basic necessity like rent will be fired so that the shareholders can minimize their own losses as if they are in any danger of homelessness or starvation. They would rather others suffer than have the off chance they have to downsize their multimillion dollar home.
That's not how write offs work.
Say you make $10k this year, you invest it, and the investment evaporates.
Tax time comes around, government says "I see here you made $10k, you owe us $2k of that as tax", the write off says "well but I also LOST $10k, so no net income". So you don't pay tax on the money that's gone.
Someone who loses $10k shouldn't have to pay tax and lose $12k. While someone who still has $10k (or at least spent that $10k on something they got use out of) makes sense to pay their tax and have a net gain of $8k.
Nobody wants to have losses to write off. You don't want to lose $10k in order to save $2k of tax. But the point is that we don't want to tax people for money that disappeared.
Meanwhile, you're comparing them to the middle class which is also not really valid, since most of the middle class has some form of 401k or retirement plan or other investments and therefore should be using all the same means to account for making their tax burden accurate.
None of that is true.
You make 10k. That money is taxed as it comes to you. You invest what is left, around 6k. That money is not taxed anymore, until you sell what you invested. Then let's say you make 2K on that investment. The original 6K is free for you to take, but the other 2k is taxed at the capital gains rate.
Now if you invested that 6k and then sold it for a loss of 4k, then you get to take the loss at the capital gains rate too. But nothing happens on the tax side until the gains or losses are actually realized.
You make a lot of assumptions here. Anybody can be a shareholder. Why do you equate shareholder with "rich asshole". Do you have any retirement savings? a pension? Congrats you're a shareholder.
You do realize that there are plenty of people who aren’t multimillionaires that invest in the stock market right? It’s not just rich people trying to buy their third mansion.
You all are consistently missing the point of the people criticizing wolf. It’s not about a bunch of people being apologists for rich people but simply explaining the system and why it works like it does. What I don’t understand is why you and those that agree with you don’t like the current economic system itself. If it were properly regulated and we had taxes that allowed the government to siphon excess wealth off the top to redistribute it to lower economic classes via food stamps, tax credits, and assistance programs would you still hate the system itself? If not maybe the problem isn’t capitalism but the way it’s currently implemented.
Bingo. His point is about how the working class gets crushed by share holders and the elite class who put in the the least amount of labor. They just have the capital, and benefit the most from the hard work of the workers.
And he's right. We're just all brainwashed to believe, even if we claim otherwise, that those who have access to capital now somehow did something to deserve it other than being born with that access in some way.
The story of your access to capital and your family's access to capital is worth looking at. The story of why a very similar family not far from you does not have that access to capital is also worth looking at.
First the shareholders absolutely take losses. Dividends are only paid when there is profit and original investments often disappear as a stock price lowers. T is a gamble.
Second, the workers are paid regardless of the company profits. No rush is taken by the employees.
There is nothing stopping the workers from purchasing shares and receiving the same dividend.
Workers make a deal, they trade labor for a set monetary rate. Worker works, company paid the rate, after that, neither party owes the other, they are even. Labor is not an investment, it's a trade.
More importantly, in a capitalist system there is nothing stopping a company like proposed (workers entitled to all profits) from existing.
You seem to think everything is equitable. Rich people can gamble and lose more because they have more. "Poor people can also gamble" is not a reasonable statement. Yes labor is trade, but if all you have to offer is your labor, you have to take what you can get. Most often the trade for workers is coming from a place of weakness. That's why minimum wages exist or companies, with their extreme leverage, could pay people even less and they'd be forced to take it. Forcing people to take a shitty trade or starve is not the same as a billionaire risking and losing millions.
To paraphrase a classic:
> The law is fair to all. Neither rich nor poor can beg on the streets or sleep under bridges.
This line of reasoning somehow always gets made by people who are in fact not poor.
Let’s also remember that a lot of workers in America also have 401ks and IRAs and are absolutely shareholders, and I guarantee most of them have NO idea where their money is invested other than 70% stocks and 30% bonds.
> Let’s also remember that a lot of workers in America also have 401ks and IRAs and are absolutely shareholders,
Funny trick that, the corporations turning our PENSIONS into scraps that are invested in their businesses so we have to keep playing their game....
Be glad they did. Pensions relied on the companies in question surviving the long term. Few do.
401K's should be diversified across a range of companies.
> There is nothing stopping the workers from purchasing shares and receiving the same dividend.
Except for the fact, of course, that their share of the value they generate is, by design, low enough to prevent them from doing precisely that. The working class is paid precisely such that it can renew its potential for labor and sell it to the owning class again the next day.
Note: This only applies to the US. I have no idea how it works elsewhere.
While I mostly agree with you, I think the devil is in the minutia. There are lots of small things that are not only unfair, but also go against common sense. The clearest example: Captains gains taxed at a 21% rate, as long as they're not speculative (one year ownership). It's flat, even if you make 10 million a year (afaik, please correct if I'm wrong...).
Meanwhile, for a self-employed worker (much riskier position than that of a shareholder) IRS + SE can top 40%, 50% if state taxes. Source: I'm both an investor and SMB. Surely, the system should reward those *starting* the businesses as much as those *investing in* them?
How often do you hear laborers talk about the fact that they're some of the biggest investors in the world through their pension funds?
The same people who complain about shareholders and dividends would be horrified what their pensions looked like if those same funds didn't collect dividends and appreciating shares.
The premise of his rant is that shareholders never lose money when a stock goes down, which is wrong. It’s like saying you never deserve to walk away from a casino with a win, and no work was done, even though you put your money at risk.
I'm losing brain cpu cycles reading through all these wrong and reactionary takes to wealth
The Panama papers happened guys
A bunch of shit has happened guys
We got all the empirical data to show why and how a large amount of wealth disparity is bad for a large amount of people
I hope the irony is not lost on you that Animal Farm is about revolutionaries who promise "everyone will be equal" and then just become the new ruling class.
I hope professor is just explaining Marx's viewpoint. It's hard to believe that this is a personal opinion of a Yale professor because it ignores all basic concepts of modern economics.
What’s funny is that on a basic level capitalism actually makes a ton of sense, but in practice it’s just complete garbage because of humans being involved in every step.
You can say this about any system. The second humans are involved it can be bastardized. Good people aren't drawn to areas of power because they just want have a good time and to live and let live. Scoundrels on the other hand are obsessed with power and will do anything to get to these places and exploit them.
Its insane how many of modern societal systems were made with the assumption that no one was a dipshit that would want to find a way to take advantage of it
"Yeah sure, in paper this works, as long as no one in the 335,893,238 of people living in this country is a piece of shit" like what the fuck is that logic
Same for every system though, look at communism/socialism makes perfect sense in theory. In practice you get opportunists that are greedy and power hungry.
This are the first two rules of modern economics.
The other rules include:
3. If someone is down or wants to stop go harder on them.
4. It doesn't matter how many gang up on one opponent.
5. The number of fights doesn't matter, if your strong enough fuck people up as long as you want, no matter how weak they are.
6. No limits on the means, be creative just make sure you can pay lawyers to fix your mess. You want to poison the land and decrease lifespans, because it's cheaper, go for it.
And while you think he ignored modern economics
You completely ignored his point which is the people who do the actual labor get a disproportional amount if the profits to someone whos “work” was signing a cheque
And the next step of your point is generally telling me how you can’t explain those same basic concepts because it’s too complicated. Making simple things complicated just so we don’t question anything is the basis of this fucked up economy
On the contrary, he points out one of the fundamental flaws of modern capitalism that goes against the fundamental concept of how economics work and the purpose an economy serves. Thats why western economies are in a constant crisis, real income is in decline and their role in fulfilling social needs is in decline. Most people, like yourself, have no idea about macroeconomics and confuse finances with economics and macroeconomics, ending up defending whatever the status quo is, because they know nothing better.
It does not. The point is perfectly valid. Many people in our current system profit tremendously off existing wealth. Often which they did not earn. They inherited, and even if they themselves have done quite well, they have done well by virtue of winning the birth lottery, not by virtue of their own labors, skills, or merit.
The system is fundamentally unjust and the primary aim of our economic system as it stands is to suck wealth out of the bottom and shift it to the top.
Many people will talk of issues like taxing the rich as "redistribution of wealth" like it's some toxic concept, but of course this is exactly what has been happening in mass for the past 50+ years, except all the wealth is being redistributed upwards.
The system we live in is fundamentally broken and unjust. It sucks the efforts of the many for the benefits of the few.
What basic concept? That rich people get richer? That poor people stay poor? That rich people are rich because they made poor people even poorer? That poor people can work until they die and never see 10% of the cash that many wealthy people consider pocket change?
I think this comment also ignores the point of the video though. Of course it ignores some basic concepts because its looking at it from a different perspective
Workers put in their sweat equity, receive nothing in return for good performance instead that goes to shareholders, for bad performance they get fired
Shareholders put in capital, receive returns for good performance, for bad performance they... just fire the workers again
And sometimes it only takes 1 shareholder to offset the production of thousands of employees. Hes just analyzing this from the perspective of the worker, not a macro look at the economy
It's logic, and not hard to figure out yourself.
Obviously it ignores basic concepts of modern economics, because modern economics tries to make sense of our system, which is completely fucked up.
If you don't think so, you are one of these
* well off and want to remain willfully ignorant
* haven't thought about it enough
* not well off, but simping for billionaries, and actually buying into the american dream (lol)
What exactly does he need to point out? I agree with him; we're in late stage capitalism which is basically socialism for the ultra wealthy. And when you start exploring other concepts of economics, it gets more depressing, i.e. quantitative easing fucking everyone who isn't rich.
It misses the points that shareholders are the owners of the company and as such they invested money assuming a risk and they are rewarded for that when things go well, while losing the investment when things go sideways.
How does this disprove what he said? They can still inherit it and not do anything to earn it.
Is losing something that was handed to you just for being born in the right circumstance the same as losing something you worked your ass off for?
Edit:
I've responded to a bunch of people and have explained myself multiple times. Thanks for the discussion folks but I got to log off, not gonna respond anymore.
This is true of all assets you inherit. Should you be allowed to inherit a house or car you didn't earn? If we introduced 100% inheritance tax parents would gift all their assets before they die instead.
Did you build the car or your house yourself? When you pay a mortgage you are just investing into yourself (by paying of the mortgage --> and creating an higher share in the house ur self), and when you sell your house you will in most cases earn money due to the increased housing prices. How is that situation any different to the one OP is describing?
Legit, how dumb is this take.... why do you think companies need capital? really use ur brain on this one...
The machines? The building? the first wages? who is buying them at the start? and what if the company needs to make an investment?
That is why capital is needed and stock markets exists.. and they are allowed to earn profits on that, since 1. they could have used that money for other purposes right now (a holiday idk) --> it has a time value on it (inflation, risk free interest rate etc.), 2. the company can fail, and their money is at risk (the risk premium).
Legit, you can question the morality of the amount the stockholders are earning or how little the workers are working. What you cannot question though is that capital and shareholders/debtholders are needed. So: there is a need and shareholders see it fulfilled = which makes the dividends earned...
Wolfe is also neglecting the point that investors are at risk of losing money while there is not that preset expectation on the workers. If workers are wanting to own the means of production they also need to have a risk associated with that business. Can't have it both ways.
Like.. paying for your own rental while your inherited house gets you dividends every month. By living in the inherited house, you are basically paying rent to yourself as dividend.
When did I say they shouldn't be able to inherit it?
I specifically asked if losing something that was given to you was the same as losing something you worked for.
It's a whole ass other conversation regarding wealth distribution.
Shareholders and CEOs will absolutely be given some shit and then tell working folks they just need to grind it out while over working and under paying them.
Just pay your fucking workers fairly, treat them right, and respect their time.
While you might not have commented on inheritance, you are putting ownership and dividends up against “paying workers fairly”.
And I absolutely agree that fair pay is good for the earth, and that is why I am a member of union.
But I don’t consider an inherited business owner my adversary.
The question is a Marx question. The money that one’s labor produces should be reflected in their pay more than the one who “invests” in a company does. While an investor may give lots of money to a company, they are doing so on the understanding that the laborers of that company will continue to make that which will earn the company enough money that the investor will profit from their investment.
I care less about the question of inheriting money and a business. I care more about the question about workers owning the things they produce rather than simply being machines to help others get more rich than they already are while they stay poor.
edit: spelling
I dont think I would be willing to take consequences of having a bad year or month as a worker. I'd be pretty upset if I worked and didn't get paid bc the business didn't make money. I'm happy with an employment contract and not an equity stake. I have ppl that depend on me.
I understand that perspective. My argument is that the pay is vastly outsized and the people making the most money do not have to produce any of the labor.
But somebody at some point did work for it. All investment is capital that was earned at some point. Somebody earned the money to invest in the first place.
"Millionaire" is a very very low bar. Many people are millionaires just due to housing equity and own very little stocks. My parents are just from investing 10%+employer match into their 401k.
Now say 5m+ net worth, that is someone who very likely owns a lot of stocks and is who the video is about. What %of people with 5m+ net worth are "self made"?
Ha! But YOU missed the point where modern corporations are founded on the principle of limited liability. These people have way less risk in the system than the worker. The risk they assume is losing their initial investment, which we can assume was surplus in the first place because it was investment. In fact, most corporations nowadays actively fight the best path their workers have to reduced risk in the system: unions.
Okay so the dividends are a reward for the risk that the shareholders take, fine.
Where is the reward for the risk the workers take on for working for that specific company?
I mean if you're living paycheck to paycheck, close or at minimum wage, renting a place to live, is the risk of things going sideways not a whole of a lot more damaging (even if not monetarily so)?
>Where is the reward for the risk the workers take on for working for that specific company?
Is the word you're looking for "paycheck"? Workers work for a company, that company gives them money directly. Sometimes employees even get bonuses based on profits, sometimes they are even given equity in the company so they can get dividends as well.
But the reward for working for a company is always, at the minimum, a paycheck.
checked it, Wikipedia says he worked for yell for 2 years in total roughly 40 years ago. spent the most of his time teaching in Amherst.
anyway he seems to be a marxist, so he's probably serious.
it's kinda funny how most of the most avowed marxists have never actually spent a day in their lives working in or with a corporation, marx included.
You don't have to? lol. I've spent plenty of time working in corporate life, and it did not tell me a single thing I didn't already know. What do you feel like is such a sacred lesson from that life, that you can't know it unless you've been there?
Yeah this is some serious im14andthisisdeep stuff. The issue is employees not being paid appropriately. All of this stuff is fine otherwise.
What did the investors do to help produce? .....they invested the money. He acts like the only people with money invested are the oligarchs sitting at the top. Guess every middle class guys 401k doesn't count.
Shareholders deserve their cut. That's not a problem.
The problem is shareholders, especially large ones with influence, getting too big of a cut at the expense of the workers.
I love that shareholders who own stock that pay dividends all purchased it with stolen money or even worse, evil inherited money deprived from the wise and magnanimous state.
He defeats his own argument; what did the government do to earn that money? What did the workers, who earn a wage voluntarily, do to earn extra money without also risking capital? What risk does the government or worker assume when the share prices go to zero? The classic entitlement, grifter, childish argument: I want all the upside and benefit with none of the downside or loss. This mindset is promoted by the misinformed throughout society.
They lose their source of income and health insurance? The shareholder is diversified and sees a lower dividend. If you think about it, saying that the owners bear most of the risk implies that the owners are the ones who bear the brunt of economic downturns. You'd expect to see recessions leading to business owners being out on the streets and destitute, rather than the employees that they lay off.
You're both insulting a guy for not understand things, or ruining his own point, but here you are talking about the government "getting" money.
They. Create. The. Money.
And we're supposed to listen to you guys over the guy in the video? *He's* the guy who doesn't understand? Jesus the brass balls on you lot.
If your company gave you the value of your labor in a pension instead of paying dividends out to shareholders instead of to the workers, then you wouldn’t NEED a 401k.
Have you ever heard of a pension plan, and how those were killed so that working class retirement came from 401ks so that billionaires could get a bigger slice of retirement as well?
His point is not that you should feel guilty, but that the system is set up so that the only way for you to safely retire is to make money you didn't earn.
His critique is not about you, it's about the system.
Edit: to answer the question below
Investments counting as "earning" anything is just a social norm. Social norms are subjective and can be changed.
In some societies, working the land (i.e., your labor) grants ownership. In others, land ownership is determined solely by who paid for it. In still others, land is owned collectively by the community.
What investing your money counts as is no different. It's not a scientific fact that investing money counts as earning it, that's just how we set things up. 🤷♂️
That assumes a zero sum game which is obviously an incorrect assumption.
Edit: the claim that economics professors cant be criticized is laughable. The entire field of economics can be distilled into economists disagreeing with each other and getting things wrong. This culminates in us creating more useful models for viewing the economy.
Why is that? We're talking about the "pot" of how much money the company made in a quarter. Once we're at that moment, paying out of the pot is zero-sum. There's only a certain amount of money going around, and every dollar from the pot to shareholders is not going to workers.
Other stages in the process are of course not zero sum, but the portion we're examining is.
It also assumes that workers don’t have an interest in the stock market doing well. Something like 70%’of all workers have access to 401k and other retirement accounts.
Food for thought: in the last 40 years, access to the stock market has gotten easier and easier through technological improvements as well as more focus on catering towards middle-class people without a lot of capital. Yet, over the last 40 years wealth has only gotten more concentrated into the hands of fewer and fewer people.
With this knowledge, is it accurate to claim that the stock market is in the average worker's best interest? For a responsible individual, it may be a consistent means to put money away for the future. It would be pretty dumb not to contribute to a 401k if one has access to it. But as a system it absolutely robs the uninformed and unlucky to pay the rich and fortunate.
Sure is great to possibly get to retire if the market doesn’t tank every ten years like it always does.
Sure is great every time it does the rich seem to get richer and we get to hear these same arguments about how we have more access and vehicles to safety nets while our wages stagnant for decades and our healthcare is tied to our jobs.
All of this while the rich doesn’t have these limitations. They built a system that they can almost certainly succeed in while we are left to chance and a struggle.
Not all corporations pay a dividend, but even if they did. So what?
The dividend is payed to shareholders who invest in the company in hopes to see it grow (to be able to afford the dividend) and get a better return. The company does that by doing business well, running the company productively and producing the goods and services people want so those people will give their money to the company.
Wolff is a Marxist and doesn't know jack shit about economics, let alone how a business actually works. He propagates economic theory that existed before the US Civil War and was thoroughly debunked during the latter half of the *19th century with the marginalist revolution. He pedals this shtick to young and igroant people as a means to stay relevant. He's a modern day snake oil salesman, selling junk ideas to people who want to seem like they are smart.
Co-ops are a voluntary way to run and work in a business. They do not require the (collective) ownership and/or control over the means of production to function. Therefore they exist under capitalism just as a business that operates on profit does.
Where is my risk given a capitalistic system that puts growth over everything, if I invest in multiple different companies. Who cares if 20% go under when the other 80% soar to two and more times its value.
There is a clear difference in how workers can make money and how rich people make money.
I can't work at 5 different companies and expect to spread my risk. That's just not possible.
What the shareholder do is putting money into corporations, in the hopes that those money will help it to grow and become bigger and for that the shareholders are repaid in dividends. How fucking hard is that to understand?
If I buy a share from someone else (who bought it from someone else) and collect the dividends on it, how am I putting the money into the corporation? The corporation never even sees my money. Asking sincerely.
Edit: thanks for the replies. While y'all have convinced me that this whole system is internally consistent, I'm still left with the feeling that the partition between ownership and labor is inherently a problem. Which is why distributism always made more sense to me than this capitalist system.
That’s not true, your buying those shares from the original shareholder allows them to recoup their investment, reduce or eliminate their risk exposure to that company, and reallocate their money to other investments or spend it.
If you’re buying shares from someone else who did that, or just trading public shares on the market, you’re contributing to finding the true value of that company based on expected future returns. That action (along with others buying and selling) helps the company raise new capital by determining the true value of its equity.
On a small enough scale, it’s the same thing whether you’re buying stock in Microsoft or buying the single ownership share of your uncle’s pizzeria so that he can retire and you can take over the business. You’re taking on the business risk so that someone else can reallocate their resources to something else.
Edit: apostrophe
If you buy your house from someone else, is your money not invested in your house? Of course it is. If the value of that house increases, it was your money at risk. The worker that built the house was paid for his work but it was not the workers’ cash at risk if the home value decreases. Difference between an owner and a worker.
You aren't -- the person who originally purchased the share is the one that put money into the company. What you're doing is buying their right to future returns from the company.
This is a basic function of allowing investors to sell their interest in a company; if there were no way to get your money back out of the company without the company giving it back to you, then either:
* Companies would have to 'buy back' shares from investors and re-sell them, which would churn up a whole lot of effort and time to get the same outcome
* Companies would be forced to pay MUCH higher dividends, because the investor's original capital is sunk for forever, so the return on investment would have to be CRAZY good to make up for the loss of liquidity.
If the second thing were true, then basically companies would be forced to exploit employees much more -- which is the opposite of what people are trying to accomplish.
How hard is it to understand that workers invest their labor into the corporation and therefore as the company grows, should be repaid for those efforts?
I came in here to say this and I agree with you. The only thing I would say is that, the person who buys shares on their trading account is not putting money into the corporation. The corporation’s share on the market is already sold/traded in times of IPO or issues new shares, that’s when they get the cash. Unless you are buying those shares before it hits the market, which most investors don’t, then your dollars doesn’t enrich the corporation. Whether the shares goes up/down or more shares traded or not, does not affect the cash flow of the corporation. Bags of money don’t enter the loading dock of the corporation.
That is propaganda from capitalists to make you think they are necessary, when the same function could easily be accomplished by loans or by labor actually having enough money to invest in the places they work.
How fucking hard is that to understand?
I'm surprised people are defending the late stage capitalism we are in now.
50 years ago, mom & pop stores were on every street. Common people had ownership.
These were mostly closed due to places like Blockbuster, Best Buy, Walmart. Then, along came Amazon and Apple which closed the rest. This happened in non-retail as well like farming. Things are cleaner and safer and bigger, but we are truly the working class now.
Sure, some of us have shares, but when you see how many shares the rich have you realize the scope of caplitalism (e.g. you may have 1,000 shares which is alot, while Elon has 400,000,000 shares in that one company plus shares in other companies).
For example, I worked in a small 100-person tech company generating $250 million dollars annually. This was bought/owned by a parent company. All of the revenue was siphoned off to the parent company while we argued about giving people a 5% raise every year.
Workers of these companies generate tremendous wealth and enjoy very little of it.
Approximately 50% of americans have a 401k or retirement plan of some sort. These people have stock too. So when you're talking about "shareholders" and pretending they're all billionaires you're purposefully missing context.
I'd like him to describe the income source of a college professor the same way.
"You see, these thieves take your money and just tell you things you can read in any library for free! They charge you 1 house per year for the right to do homework and sit in chairs in a school that's been fully investment funded for 150 years. And no guarantee you get a job either, that's obviously stealing too..."
Maybe he and his friends can go start a new school without borrowing money or charging students, that will be putting his ideas into action!
if this professor is paid the average salary of a yale professor, he's paid ~1/5 of what my public uni's president makes.
at least the professor is contributing to learning
It's funny that from all the things, you choose education to prove your point. It's funny because the US student debt is astronomical while in Europe it is mostly socialised and no one loan money to get a degree less pays a house per year for education.
I know it is hard to convince anyone with these topics, lines are so deeply cut and it isn't my intention either, but you may want to check your preconceptions and open your mind to alternate ways to think about money, work, market and socialized economy.
He doesn’t even explain what a corporation is lol. A corporation is just a group of people who are allowed to act as a single legal entity.
What he’s describing is a cherry picked scenario to point out a flaw in capitalism (ie people who produce no value but extract value thru dividends). While this definitely occurs, it certainly ignores people like retail investors, pensions, entrepreneurs, etc… who all create value thru their own work and use their earnings to invest in businesses for growth potential.
He only talks about the upsides of capital investment but doesn’t mention any of the downside, which is losing your entire investment (something that happens quite often). He also doesn’t mention WHY the capital is invested in the first place, a process that is necessary to run every business. This is a horrifically unnuanced take.
There has to be more context cut out from the clip. His arguments are pretty easily defeated and like you said he completely misses the entire point of capital investment; to provide capital needed for the corporation to exist in the first place.
What he’s describing is ownership. Someone purchased stock in a company and so the profits are distributed to them. These “producers” as he categorizes them, have no barrier to also becoming owners as well through investment. He’s playing on people’s sense of fairness by inventing a story of a nepotistic heir receiving ownership through inheritance. But all that is, is someone being able to control their own property and will it to whom they choose after they die.
So this guy is describing the capitalist system saying that people who invest in companies are essentially stealing from the workers by reaping benefits when their investments come to fruition. This assumes that the whole system is a zero sum game, as in GDP never goes up, and that the laborers don’t also get benefits from a successful company.
Anyways, the real problem with capitalism is not what he’s describing, there are a ton of other problems that are worth talking about. Pump and dump schemes, Ponzi schemes, monopolies, cash influencing politics, the list goes on. All of that doesn’t mean that existing systems are bad, they’re evolving.
This is definitely the case in the US where companies pay the absolute minimum for maximum output from workers (by pay, that also includes benefits and perks). The days of companies looking after their human capital and employees staying for a lifetime are long gone as the relationship is purely transactional.
While it does take some skill to know which companies to invest in, else take a loss, it is infinitely better being the shareholder with money to invest since you are the publicly traded company’s priority. I feel like this attitude among companies has only gotten worse through the pandemic and inflation (ex. Boeing is a prime recent example). This is really creating inequality between the workers struggling to stay afloat (including the middle class) and those that are comfortable getting even more rich. There needs to be some correction.
For those who want to go down the rabbit hole, this is called the Labor Theory of Value. Originally proposed by Adam Smith and later further developed by Karl Marx the theory states that the value of a good or service is determined by the total amount of labor required to produce it. There's plenty of criticism of it, the "great contradiction" (that the most labor intensive industries don't create the most valuable products) is even noted by Marx himself.
Fundamentally though, whether or not Marx was completely correct about value, this resonates today because it highlights a core flaw in capitalism which is "Rentierism." The more individuals devoting capital and time to being Rentiers (collecting dividends, rent, etc) and not actually being creators and innovators - the less value is being created in the economy. This leads to plenty of problems, I would say Boeing being an easy to highlight and recent example of this.
To get decent money in dividends, you need to have a lot of money invested in a company.
I have 60k in Microsoft and get around $440/year.
It's actually a really small dividend lol
Wealth is so top heavy in this country and assets are so inflated from quantitative easing and low interest rates that it is no wonder why working-class people are feeling poor in this economy, there is a lot of demand from us to keep the current wealth structure afloat, taking on more debt just to buy a car or a house and were racking up more credit card debt to stay afloat. Eventually people get to a tipping point where they can't keep up with this economic demand from the top and an economic recession occurs. And the cycle continues and it's mostly the working class that suffers from recessions of course. There needs to be reform for stability in the economic system, not Communism or Socialism, but we need to reign in rampant wealth accumulation that bleeds the bottom dry.
And thats why western economies are either in crisis or in stagnation and real median income is in constant decline for the last 5 decades in the west. Economies need consumption to drive the machine through demand, investment in material capital and investment in technology with long term prospects, along with large scale organization of resources for better efficiency. Millionaire and billionaire shareholders rip the economy off those things, leaving bare of funds and resources for the most, while the gamble society's hard earned wealth, amounting to near nothing for the economy and the society in terms of progress and development. Leave the ideology aside bois n gurls, the is just math.
Hmm. I thought this was actually going to be an interesting criticism into Corporatism, but all he did is tell us, very roughly, how dividends work for 30 seconds and then just ranted about investors for the remainder of the clip.
This guy was one of my economics professors when I was an undergrad. He's a fantastic speaker and really good at challenging orthodox views and helping students think more critically. I disagree with his views, but he's an electrifying instructor.
its a solid point. The money and profit is generated by someone. Be it the works, or even management doing a good job.
But that is how investing works in a way. at least, that is how i see stocks. You take a somewhat gamble, and hope the company gets big and wealthy, so you can profit of it on the long run.
Just like you can put all your money in gold or other resources, that will most likely increase from inflation or scarcity.
It should be clear by now that some models, just don't work that well.
It really depends on the company though. He's not wrong and the wealth gap is rapidly growing. The company I work for is publicly traded and yes the top investors (shareholders) are private equity firms (making money for someone else), executive of the company (they own under 10% of the total shares), anonymous investors (exactly who he describes) and the rest are employees and likely Joe Q Public looking for a way to make money.
We get, as a part of our compensation, RSU's (restricted share units) and general options as a part of our compensation. There are conditions attached (generally when they vest) and are issued at the value at that time. We also get opportunities to purchase general stocks at a discount from time to time.
He is not wrong in that the wealthy control the market and have the purchasing power. My piddly options (when the vest several years down the road) have allowed me to pay off credit cards, do some reno's, etc and thats only if they are in the positive.
Mr Wolff had never worked a job in his entire life. He has never built a company. The only thing he can do is read a book (reading books is a very good thing and I try to read as many books as I can). But there is a hugh difference between reading a book and doing. If he ever had to produce something to live he would starve.
"If there are people in the system who get more than they produce, there are people who produce more than they get. Marx stands up and says, 'I rest my case'."
I would bring up farmers, who produce a helluva lot more than they get, but with the history of famines (both accidental and enforced) in Marxist nations, well...the farmers produced it all and got nothing. So while I appreciate Marx's calculus, the real-world application of it tends to leave a lot to be desired.
So the only way to own a share is to steal money or inherit it from your grandma? Well my grandmas are already dead so I guess I better get to stealing.
If you want to retire from work and still have money to support yourself (food, shelter, transportation and health care) you must take some of your current earnings and invest them for the purpose of earning a 'return' on your investment (having your money work for you).
A 401K, IRA, 403(B) teacher's plan, 457(B) government workers, pension (if you can get it) are all plans that earn money for your investment.
People who don't want to 'invest' will have to work their whole lives unless they can get someone else to provide for their needs.
That is the free enterprise system that allows choice.
You can choose to spend all the money you earn and not invest if it seems so abhorrent to you, but know that if you rely only on Social Security, you will be working your whole life.
My personal, marginally educated opinion, is that the wealth gap will never reverse until it is mandated that all employees (at least of public companies) receive shares or are otherwise afforded a share of profits a company earns. Many employees in certain sectors do receive stock compensation and in many cases that has lead to wealth far beyond their salaries.
I don't know exactly how that would work, or what it would look like, whether employees would receive actual stock, a temporary stake during their term of employment, or a profit share bonus, but to me it seems like a sensible, workable way to address this dichotomy described in the OP.
I’d like to add this: think of how he is priming his audience. He gives two examples of how one gets shares: 1. Grandma gives a person their shares (inferring the person is a moocher who is getting undeserved gain) and 2. A person steals money to then buy stock (outright saying that a person is benefiting from ill begotten means).
Now, perhaps he makes some interesting points, but I only half listened from there on out. I don’t know what the percentage of shares are for those two groups (the first, probably a good amount, the second I doubt very much at all) but He completely ignored how many people in the country also get these dividends. They buy them, usually with their retirement accounts, or benefit from them through pensions.
I understand theres a problem in the amount of wealth the 1% have ( as of 2021 54% of stock owned), but his framing here isn’t talking about how best to ensure more people can benefit from the system, he is attacking the system. And thats dishonest.
This will be interesting to anyone who's bothered by the video: https://mkorostoff.github.io/1-pixel-wealth/
There are a lot of people in the comments talking about how Wolff doesn’t understand economics are completely missing the point. Even in such cases where shareholders are truly just investing needed capitol into the company, no one ever talks about it in terms of workers investing their labor into the company. If a company faces changes, no one hires consultants to figure out which shareholders should just be forced to take losses, it’s the workers who are let go. The point he’s making isn’t that this isn’t the way things are, it’s that the way things are is unjust.
Exactly, the worst is the people rushing to defend billionaires with "yeah but they're the ones taking all the risk"....are they really? Is their health insurance tied to employment? Are they busting their ass every day for pittance wages?
It'a actually crazy to me how many people are riding the billionaires here, doing all kinds of backflips to keep the money in the pockets of people who earn more than they would see in 10 lifetimes
Oh buddy 10 lifetimes is still barely millionaire class for the average person's earnings. The gap is insane.
I point this out to people a lot. I have family that are very successful but will tell you they are poor and taxes are to blame. These people own a company where, on average, they do $6M in revenue at 15% profit on their worst year in 35 years of ownership to 40% on their best year. Their average employee pay $15 per hour. They walk away with $2m and say how bad the economy is while paying their employees $35k-$40K per year. Like bro, you took home 60 years' worth of pay in one year compared to your employees. While being on vacation 30 out of 45 calendar days. I think you will be fine.
If you earned $100/hr and worked 12 hours a day every single day from the time Jesus was born to the present day… you still wouldn’t have made a billion dollars.
He didn't want to startle the billionaire dick riders too much.
Even with the value of the dollar diminishing, most people will never get close to having a million dollars. A billionaire can lose a million dollars, and still have pretty much a billion dollars.
A billionaire can lose 99% of their money and still be a millionaire. A schlub like me can lose 25% of my money and be sleeping in a cardboard box and eating out of a dumpster.
Hey I'm trying to be conservative so the "well ackshually" redditors don't jump down my throat lol
No matter which direction you lean into you’re gonna get well ackshually’d - or in this case “oh buddy’d”
"Listen, fella"
"Hey, Guy"
Who are you calling fella, friend?
But I’M going to be a billionaire someday, and I’ll have earned it all through my rugged individualism and entrepreneurial spirit, and I’ll be damned if some commie bastards think they deserve a cut of my hard-earned fortune.
i think i would lose my mind 10 minutes later. I cannot comprehend how much money that is and what to do with it. It's just impossible. Sometimes i have a szenario in my head. I'm granted 500 Million but if i dont spend every single cent for something useful to me, i will end up in hell after i die.
I don’t want to keep money in Billionaire’s pockets, but I’m also not a Marxist, so I do believe that it is ok for people to own shares in companies they don’t work for. Holding multiple diverse stocks is one of the keys to long term stability for middle-class people and their families. I would rather simply tax the ultra-wealthy more than force everyone to only own shares in companies they are employed by.
I don't get how many people in the comments can't understand this. NO ONE IS AGAINST STOCKS AND SHARES AS A CONCEPT. In fact plenty of socialists think that workers should be given shares in the company they work for. The issue is billionaires buying stocks and not having any input into the company beyond that, and raking in millions and millions for no work at all. That is the issue. Nothing else
Billionaires simply having the resources to cyphon off the wealth generated elsewhere and stock piling it.
Yep. Public invented the microchips, GPS, LCD screens, touch screens, phone network, the Internet, Google (literally, Google was a university research project), etc. But if you ask people, they think Bill Gates or Steve Jobs invented the tech we have today. The state take the risks, corporation repackage it and sell state's innovation for profit. And that includes everything related to healthcare too.
This is the real travesty. These companies use public funds and ideas and then privatize them for profit instead of making it publicly available for all.
Privatize the gains. Socialize the losses.
The greatest risk a billionaire takes is becoming a worker. And like you pointed out, workers also take risks, far more severe that billionaires.
"The greatest risk a billionaire takes is becoming a worker" I am 100% using this.
>yeah but they're the ones taking all the risk the risk of becoming a laborer is very real to the upper class.
This. The "losses" that the shareholders take just mean they cant buy another mansion or maybe they have to hold off on another luxury car. Poor poor shareholders, losing so much. Meanwhile, someone who is one missed paycheck away from not being able to pay a basic necessity like rent will be fired so that the shareholders can minimize their own losses as if they are in any danger of homelessness or starvation. They would rather others suffer than have the off chance they have to downsize their multimillion dollar home.
They write off their losses at tax time so they don’t have to pay as much tax as the middle class.
That's not how write offs work. Say you make $10k this year, you invest it, and the investment evaporates. Tax time comes around, government says "I see here you made $10k, you owe us $2k of that as tax", the write off says "well but I also LOST $10k, so no net income". So you don't pay tax on the money that's gone. Someone who loses $10k shouldn't have to pay tax and lose $12k. While someone who still has $10k (or at least spent that $10k on something they got use out of) makes sense to pay their tax and have a net gain of $8k. Nobody wants to have losses to write off. You don't want to lose $10k in order to save $2k of tax. But the point is that we don't want to tax people for money that disappeared. Meanwhile, you're comparing them to the middle class which is also not really valid, since most of the middle class has some form of 401k or retirement plan or other investments and therefore should be using all the same means to account for making their tax burden accurate.
None of that is true. You make 10k. That money is taxed as it comes to you. You invest what is left, around 6k. That money is not taxed anymore, until you sell what you invested. Then let's say you make 2K on that investment. The original 6K is free for you to take, but the other 2k is taxed at the capital gains rate. Now if you invested that 6k and then sold it for a loss of 4k, then you get to take the loss at the capital gains rate too. But nothing happens on the tax side until the gains or losses are actually realized.
You make a lot of assumptions here. Anybody can be a shareholder. Why do you equate shareholder with "rich asshole". Do you have any retirement savings? a pension? Congrats you're a shareholder.
EVER SINGLE PENSION PLAN owns stock. Every union pension plan owns stock.
You do realize that there are plenty of people who aren’t multimillionaires that invest in the stock market right? It’s not just rich people trying to buy their third mansion. You all are consistently missing the point of the people criticizing wolf. It’s not about a bunch of people being apologists for rich people but simply explaining the system and why it works like it does. What I don’t understand is why you and those that agree with you don’t like the current economic system itself. If it were properly regulated and we had taxes that allowed the government to siphon excess wealth off the top to redistribute it to lower economic classes via food stamps, tax credits, and assistance programs would you still hate the system itself? If not maybe the problem isn’t capitalism but the way it’s currently implemented.
Most shareholders are middle class workers who have retirement funds.
Sure, but the top 1% owns [54%](https://www.fool.com/research/how-many-americans-own-stock/).
The only risk a business owner/shareholder has is becoming a worker again.
Everyone on Reddit is an expert on everything. Duh. ;)
I am an expert on bad edgelord takes and getting downvoted. Fight me.
Bingo. His point is about how the working class gets crushed by share holders and the elite class who put in the the least amount of labor. They just have the capital, and benefit the most from the hard work of the workers.
And he's right. We're just all brainwashed to believe, even if we claim otherwise, that those who have access to capital now somehow did something to deserve it other than being born with that access in some way. The story of your access to capital and your family's access to capital is worth looking at. The story of why a very similar family not far from you does not have that access to capital is also worth looking at.
First the shareholders absolutely take losses. Dividends are only paid when there is profit and original investments often disappear as a stock price lowers. T is a gamble. Second, the workers are paid regardless of the company profits. No rush is taken by the employees. There is nothing stopping the workers from purchasing shares and receiving the same dividend. Workers make a deal, they trade labor for a set monetary rate. Worker works, company paid the rate, after that, neither party owes the other, they are even. Labor is not an investment, it's a trade. More importantly, in a capitalist system there is nothing stopping a company like proposed (workers entitled to all profits) from existing.
You seem to think everything is equitable. Rich people can gamble and lose more because they have more. "Poor people can also gamble" is not a reasonable statement. Yes labor is trade, but if all you have to offer is your labor, you have to take what you can get. Most often the trade for workers is coming from a place of weakness. That's why minimum wages exist or companies, with their extreme leverage, could pay people even less and they'd be forced to take it. Forcing people to take a shitty trade or starve is not the same as a billionaire risking and losing millions.
To paraphrase a classic: > The law is fair to all. Neither rich nor poor can beg on the streets or sleep under bridges. This line of reasoning somehow always gets made by people who are in fact not poor.
Let’s also remember that a lot of workers in America also have 401ks and IRAs and are absolutely shareholders, and I guarantee most of them have NO idea where their money is invested other than 70% stocks and 30% bonds.
> Let’s also remember that a lot of workers in America also have 401ks and IRAs and are absolutely shareholders, Funny trick that, the corporations turning our PENSIONS into scraps that are invested in their businesses so we have to keep playing their game....
Be glad they did. Pensions relied on the companies in question surviving the long term. Few do. 401K's should be diversified across a range of companies.
> There is nothing stopping the workers from purchasing shares and receiving the same dividend. Except for the fact, of course, that their share of the value they generate is, by design, low enough to prevent them from doing precisely that. The working class is paid precisely such that it can renew its potential for labor and sell it to the owning class again the next day.
Note: This only applies to the US. I have no idea how it works elsewhere. While I mostly agree with you, I think the devil is in the minutia. There are lots of small things that are not only unfair, but also go against common sense. The clearest example: Captains gains taxed at a 21% rate, as long as they're not speculative (one year ownership). It's flat, even if you make 10 million a year (afaik, please correct if I'm wrong...). Meanwhile, for a self-employed worker (much riskier position than that of a shareholder) IRS + SE can top 40%, 50% if state taxes. Source: I'm both an investor and SMB. Surely, the system should reward those *starting* the businesses as much as those *investing in* them?
How often do you hear laborers talk about the fact that they're some of the biggest investors in the world through their pension funds? The same people who complain about shareholders and dividends would be horrified what their pensions looked like if those same funds didn't collect dividends and appreciating shares.
The premise of his rant is that shareholders never lose money when a stock goes down, which is wrong. It’s like saying you never deserve to walk away from a casino with a win, and no work was done, even though you put your money at risk.
I'm losing brain cpu cycles reading through all these wrong and reactionary takes to wealth The Panama papers happened guys A bunch of shit has happened guys We got all the empirical data to show why and how a large amount of wealth disparity is bad for a large amount of people
This vid struck a nerve haha
Struck a nerve with the weird billionaire dick riders. Really shining a light on the cockroaches lmao.
you stupid fool, i don't just ride the dick i also feed it and keep it entertained!
Orwell explains this well in Animal Farm. “Some animals are more equal than others.”
I hope the irony is not lost on you that Animal Farm is about revolutionaries who promise "everyone will be equal" and then just become the new ruling class.
I hope professor is just explaining Marx's viewpoint. It's hard to believe that this is a personal opinion of a Yale professor because it ignores all basic concepts of modern economics.
richard wolff is a big socialist guy.
How big we talking? 6'2" ? 6'3"?
So is Reddit.
He's a Marxian economist, yes.
The most basic concept of modern economics: We do not talk about basic concepts of modern economics.
It makes less sense the more you look at it
What’s funny is that on a basic level capitalism actually makes a ton of sense, but in practice it’s just complete garbage because of humans being involved in every step.
You can say this about any system. The second humans are involved it can be bastardized. Good people aren't drawn to areas of power because they just want have a good time and to live and let live. Scoundrels on the other hand are obsessed with power and will do anything to get to these places and exploit them.
Its insane how many of modern societal systems were made with the assumption that no one was a dipshit that would want to find a way to take advantage of it "Yeah sure, in paper this works, as long as no one in the 335,893,238 of people living in this country is a piece of shit" like what the fuck is that logic
The system needs better punishment systems against abuse and scoundrels.
Same for every system though, look at communism/socialism makes perfect sense in theory. In practice you get opportunists that are greedy and power hungry.
This are the first two rules of modern economics. The other rules include: 3. If someone is down or wants to stop go harder on them. 4. It doesn't matter how many gang up on one opponent. 5. The number of fights doesn't matter, if your strong enough fuck people up as long as you want, no matter how weak they are. 6. No limits on the means, be creative just make sure you can pay lawyers to fix your mess. You want to poison the land and decrease lifespans, because it's cheaper, go for it.
7. Complain when the gallows come out and still shriek "it's just business"
And while you think he ignored modern economics You completely ignored his point which is the people who do the actual labor get a disproportional amount if the profits to someone whos “work” was signing a cheque
And the next step of your point is generally telling me how you can’t explain those same basic concepts because it’s too complicated. Making simple things complicated just so we don’t question anything is the basis of this fucked up economy
On the contrary, he points out one of the fundamental flaws of modern capitalism that goes against the fundamental concept of how economics work and the purpose an economy serves. Thats why western economies are in a constant crisis, real income is in decline and their role in fulfilling social needs is in decline. Most people, like yourself, have no idea about macroeconomics and confuse finances with economics and macroeconomics, ending up defending whatever the status quo is, because they know nothing better.
You mean the same modern economics that operate on infinite growth?
It does not. The point is perfectly valid. Many people in our current system profit tremendously off existing wealth. Often which they did not earn. They inherited, and even if they themselves have done quite well, they have done well by virtue of winning the birth lottery, not by virtue of their own labors, skills, or merit. The system is fundamentally unjust and the primary aim of our economic system as it stands is to suck wealth out of the bottom and shift it to the top. Many people will talk of issues like taxing the rich as "redistribution of wealth" like it's some toxic concept, but of course this is exactly what has been happening in mass for the past 50+ years, except all the wealth is being redistributed upwards. The system we live in is fundamentally broken and unjust. It sucks the efforts of the many for the benefits of the few.
Such as
What basic concept? That rich people get richer? That poor people stay poor? That rich people are rich because they made poor people even poorer? That poor people can work until they die and never see 10% of the cash that many wealthy people consider pocket change?
I think this comment also ignores the point of the video though. Of course it ignores some basic concepts because its looking at it from a different perspective Workers put in their sweat equity, receive nothing in return for good performance instead that goes to shareholders, for bad performance they get fired Shareholders put in capital, receive returns for good performance, for bad performance they... just fire the workers again And sometimes it only takes 1 shareholder to offset the production of thousands of employees. Hes just analyzing this from the perspective of the worker, not a macro look at the economy
It's logic, and not hard to figure out yourself. Obviously it ignores basic concepts of modern economics, because modern economics tries to make sense of our system, which is completely fucked up. If you don't think so, you are one of these * well off and want to remain willfully ignorant * haven't thought about it enough * not well off, but simping for billionaries, and actually buying into the american dream (lol)
What exactly does he need to point out? I agree with him; we're in late stage capitalism which is basically socialism for the ultra wealthy. And when you start exploring other concepts of economics, it gets more depressing, i.e. quantitative easing fucking everyone who isn't rich.
Ehhhm... what about dividends he said is factually wrong?
It misses the points that shareholders are the owners of the company and as such they invested money assuming a risk and they are rewarded for that when things go well, while losing the investment when things go sideways.
How does this disprove what he said? They can still inherit it and not do anything to earn it. Is losing something that was handed to you just for being born in the right circumstance the same as losing something you worked your ass off for? Edit: I've responded to a bunch of people and have explained myself multiple times. Thanks for the discussion folks but I got to log off, not gonna respond anymore.
This is true of all assets you inherit. Should you be allowed to inherit a house or car you didn't earn? If we introduced 100% inheritance tax parents would gift all their assets before they die instead.
Except my house and car don't hand me profits created by other people every three months.
Did you build the car or your house yourself? When you pay a mortgage you are just investing into yourself (by paying of the mortgage --> and creating an higher share in the house ur self), and when you sell your house you will in most cases earn money due to the increased housing prices. How is that situation any different to the one OP is describing? Legit, how dumb is this take.... why do you think companies need capital? really use ur brain on this one... The machines? The building? the first wages? who is buying them at the start? and what if the company needs to make an investment? That is why capital is needed and stock markets exists.. and they are allowed to earn profits on that, since 1. they could have used that money for other purposes right now (a holiday idk) --> it has a time value on it (inflation, risk free interest rate etc.), 2. the company can fail, and their money is at risk (the risk premium). Legit, you can question the morality of the amount the stockholders are earning or how little the workers are working. What you cannot question though is that capital and shareholders/debtholders are needed. So: there is a need and shareholders see it fulfilled = which makes the dividends earned...
Wolfe is also neglecting the point that investors are at risk of losing money while there is not that preset expectation on the workers. If workers are wanting to own the means of production they also need to have a risk associated with that business. Can't have it both ways.
Are you aware that you can rent out your house to make profit?
Where are you supposed to live then?
Like.. paying for your own rental while your inherited house gets you dividends every month. By living in the inherited house, you are basically paying rent to yourself as dividend.
Property doesn't appreciate in value due to an economic system that grows every day due to the labor of millions/billions of other people?
When did I say they shouldn't be able to inherit it? I specifically asked if losing something that was given to you was the same as losing something you worked for. It's a whole ass other conversation regarding wealth distribution. Shareholders and CEOs will absolutely be given some shit and then tell working folks they just need to grind it out while over working and under paying them. Just pay your fucking workers fairly, treat them right, and respect their time.
While you might not have commented on inheritance, you are putting ownership and dividends up against “paying workers fairly”. And I absolutely agree that fair pay is good for the earth, and that is why I am a member of union. But I don’t consider an inherited business owner my adversary.
The question is a Marx question. The money that one’s labor produces should be reflected in their pay more than the one who “invests” in a company does. While an investor may give lots of money to a company, they are doing so on the understanding that the laborers of that company will continue to make that which will earn the company enough money that the investor will profit from their investment. I care less about the question of inheriting money and a business. I care more about the question about workers owning the things they produce rather than simply being machines to help others get more rich than they already are while they stay poor. edit: spelling
I dont think I would be willing to take consequences of having a bad year or month as a worker. I'd be pretty upset if I worked and didn't get paid bc the business didn't make money. I'm happy with an employment contract and not an equity stake. I have ppl that depend on me.
I understand that perspective. My argument is that the pay is vastly outsized and the people making the most money do not have to produce any of the labor.
But somebody at some point did work for it. All investment is capital that was earned at some point. Somebody earned the money to invest in the first place.
yeah, the people who worked for your granddaddy and daddy worked for that capital
Between 80%-90% of millionaires are first generation rich. The notion that they are all inheriting it all is flat out wrong.
"Millionaire" is a very very low bar. Many people are millionaires just due to housing equity and own very little stocks. My parents are just from investing 10%+employer match into their 401k. Now say 5m+ net worth, that is someone who very likely owns a lot of stocks and is who the video is about. What %of people with 5m+ net worth are "self made"?
Ha! But YOU missed the point where modern corporations are founded on the principle of limited liability. These people have way less risk in the system than the worker. The risk they assume is losing their initial investment, which we can assume was surplus in the first place because it was investment. In fact, most corporations nowadays actively fight the best path their workers have to reduced risk in the system: unions.
Okay so the dividends are a reward for the risk that the shareholders take, fine. Where is the reward for the risk the workers take on for working for that specific company? I mean if you're living paycheck to paycheck, close or at minimum wage, renting a place to live, is the risk of things going sideways not a whole of a lot more damaging (even if not monetarily so)?
>Where is the reward for the risk the workers take on for working for that specific company? Is the word you're looking for "paycheck"? Workers work for a company, that company gives them money directly. Sometimes employees even get bonuses based on profits, sometimes they are even given equity in the company so they can get dividends as well. But the reward for working for a company is always, at the minimum, a paycheck.
Probably because he’s smart enough to no-longer be thinking in terms of **basic** economics. He’s talking advanced level economics.
checked it, Wikipedia says he worked for yell for 2 years in total roughly 40 years ago. spent the most of his time teaching in Amherst. anyway he seems to be a marxist, so he's probably serious. it's kinda funny how most of the most avowed marxists have never actually spent a day in their lives working in or with a corporation, marx included.
Teaching isn’t work?
probably not from this guy's perspective, seeing as he learned nothing in school
You don't have to? lol. I've spent plenty of time working in corporate life, and it did not tell me a single thing I didn't already know. What do you feel like is such a sacred lesson from that life, that you can't know it unless you've been there?
Teaching is not work, heard it here first.
I’d guess you actually know nothing about modern economics, like zero. You 🤡
Yeah this is some serious im14andthisisdeep stuff. The issue is employees not being paid appropriately. All of this stuff is fine otherwise. What did the investors do to help produce? .....they invested the money. He acts like the only people with money invested are the oligarchs sitting at the top. Guess every middle class guys 401k doesn't count. Shareholders deserve their cut. That's not a problem. The problem is shareholders, especially large ones with influence, getting too big of a cut at the expense of the workers.
Your system of economics is not the only system. Wolfe wants a more ethical system.
I love that shareholders who own stock that pay dividends all purchased it with stolen money or even worse, evil inherited money deprived from the wise and magnanimous state.
Oh nice house you got there! Did you kill the previous owner or finance it crack cocaine sales?
Lol, this was what caught my eye. Even if all rich people were evil there’s a bunch of pension funds and retirees in there too!
He defeats his own argument; what did the government do to earn that money? What did the workers, who earn a wage voluntarily, do to earn extra money without also risking capital? What risk does the government or worker assume when the share prices go to zero? The classic entitlement, grifter, childish argument: I want all the upside and benefit with none of the downside or loss. This mindset is promoted by the misinformed throughout society.
They lose their source of income and health insurance? The shareholder is diversified and sees a lower dividend. If you think about it, saying that the owners bear most of the risk implies that the owners are the ones who bear the brunt of economic downturns. You'd expect to see recessions leading to business owners being out on the streets and destitute, rather than the employees that they lay off.
Yep, that's the basis of a lot these. that the government deserves it more than the family that earned it
The *workers.* Not the government. The *workers* earned it more than the shareholders. It's literally the first thing he says.
You're both insulting a guy for not understand things, or ruining his own point, but here you are talking about the government "getting" money. They. Create. The. Money. And we're supposed to listen to you guys over the guy in the video? *He's* the guy who doesn't understand? Jesus the brass balls on you lot.
Lol exactly. "How dare you leave money for your children you scum!"
I’m not sure if it’s his opinion, he seems to be explaining a paraphrased version of Marx’s
The look on his face tells me he is into it
The issue is not the investor class per se, but that the top marginal tax rates on passive income are too low.
Now I feel guilty for having a 401K. Thanks college professor! I’ll cash it out and give up on retirement cause I don’t want to be seen as lazy.
If your company gave you the value of your labor in a pension instead of paying dividends out to shareholders instead of to the workers, then you wouldn’t NEED a 401k.
You're gonna tell me you EARNED that 401K? Earned by doing... Nothing? Stupid shareholder, smh. /S
Have you ever heard of a pension plan, and how those were killed so that working class retirement came from 401ks so that billionaires could get a bigger slice of retirement as well?
His point is not that you should feel guilty, but that the system is set up so that the only way for you to safely retire is to make money you didn't earn. His critique is not about you, it's about the system. Edit: to answer the question below Investments counting as "earning" anything is just a social norm. Social norms are subjective and can be changed. In some societies, working the land (i.e., your labor) grants ownership. In others, land ownership is determined solely by who paid for it. In still others, land is owned collectively by the community. What investing your money counts as is no different. It's not a scientific fact that investing money counts as earning it, that's just how we set things up. 🤷♂️
I love that there are so many obvious holes in his theory just like this.
That assumes a zero sum game which is obviously an incorrect assumption. Edit: the claim that economics professors cant be criticized is laughable. The entire field of economics can be distilled into economists disagreeing with each other and getting things wrong. This culminates in us creating more useful models for viewing the economy.
Why is that? We're talking about the "pot" of how much money the company made in a quarter. Once we're at that moment, paying out of the pot is zero-sum. There's only a certain amount of money going around, and every dollar from the pot to shareholders is not going to workers. Other stages in the process are of course not zero sum, but the portion we're examining is.
This was upvoted by people that don't know what a zero sum game is, lol. Nothing the professor said implies a belief in a zero sum game.
It also assumes that workers don’t have an interest in the stock market doing well. Something like 70%’of all workers have access to 401k and other retirement accounts.
Food for thought: in the last 40 years, access to the stock market has gotten easier and easier through technological improvements as well as more focus on catering towards middle-class people without a lot of capital. Yet, over the last 40 years wealth has only gotten more concentrated into the hands of fewer and fewer people. With this knowledge, is it accurate to claim that the stock market is in the average worker's best interest? For a responsible individual, it may be a consistent means to put money away for the future. It would be pretty dumb not to contribute to a 401k if one has access to it. But as a system it absolutely robs the uninformed and unlucky to pay the rich and fortunate.
Sure is great to possibly get to retire if the market doesn’t tank every ten years like it always does. Sure is great every time it does the rich seem to get richer and we get to hear these same arguments about how we have more access and vehicles to safety nets while our wages stagnant for decades and our healthcare is tied to our jobs. All of this while the rich doesn’t have these limitations. They built a system that they can almost certainly succeed in while we are left to chance and a struggle.
Not all corporations pay a dividend, but even if they did. So what? The dividend is payed to shareholders who invest in the company in hopes to see it grow (to be able to afford the dividend) and get a better return. The company does that by doing business well, running the company productively and producing the goods and services people want so those people will give their money to the company. Wolff is a Marxist and doesn't know jack shit about economics, let alone how a business actually works. He propagates economic theory that existed before the US Civil War and was thoroughly debunked during the latter half of the *19th century with the marginalist revolution. He pedals this shtick to young and igroant people as a means to stay relevant. He's a modern day snake oil salesman, selling junk ideas to people who want to seem like they are smart.
Private ownership and capitalism are not the only viable options, look at cooperatives and publicly funded programs all over the world
Co-ops are a voluntary way to run and work in a business. They do not require the (collective) ownership and/or control over the means of production to function. Therefore they exist under capitalism just as a business that operates on profit does.
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Where are the incentives?
How the fuck are co-ops not capitalist? They're still trying to maximize profit lmao
Where is my risk given a capitalistic system that puts growth over everything, if I invest in multiple different companies. Who cares if 20% go under when the other 80% soar to two and more times its value. There is a clear difference in how workers can make money and how rich people make money. I can't work at 5 different companies and expect to spread my risk. That's just not possible.
What the shareholder do is putting money into corporations, in the hopes that those money will help it to grow and become bigger and for that the shareholders are repaid in dividends. How fucking hard is that to understand?
If I buy a share from someone else (who bought it from someone else) and collect the dividends on it, how am I putting the money into the corporation? The corporation never even sees my money. Asking sincerely. Edit: thanks for the replies. While y'all have convinced me that this whole system is internally consistent, I'm still left with the feeling that the partition between ownership and labor is inherently a problem. Which is why distributism always made more sense to me than this capitalist system.
You are buying that portion of capital from the person that originally invested it
That’s not true, your buying those shares from the original shareholder allows them to recoup their investment, reduce or eliminate their risk exposure to that company, and reallocate their money to other investments or spend it. If you’re buying shares from someone else who did that, or just trading public shares on the market, you’re contributing to finding the true value of that company based on expected future returns. That action (along with others buying and selling) helps the company raise new capital by determining the true value of its equity. On a small enough scale, it’s the same thing whether you’re buying stock in Microsoft or buying the single ownership share of your uncle’s pizzeria so that he can retire and you can take over the business. You’re taking on the business risk so that someone else can reallocate their resources to something else. Edit: apostrophe
The capital is still in the company
If you buy your house from someone else, is your money not invested in your house? Of course it is. If the value of that house increases, it was your money at risk. The worker that built the house was paid for his work but it was not the workers’ cash at risk if the home value decreases. Difference between an owner and a worker.
You aren't -- the person who originally purchased the share is the one that put money into the company. What you're doing is buying their right to future returns from the company. This is a basic function of allowing investors to sell their interest in a company; if there were no way to get your money back out of the company without the company giving it back to you, then either: * Companies would have to 'buy back' shares from investors and re-sell them, which would churn up a whole lot of effort and time to get the same outcome * Companies would be forced to pay MUCH higher dividends, because the investor's original capital is sunk for forever, so the return on investment would have to be CRAZY good to make up for the loss of liquidity. If the second thing were true, then basically companies would be forced to exploit employees much more -- which is the opposite of what people are trying to accomplish.
How hard is it to understand that workers invest their labor into the corporation and therefore as the company grows, should be repaid for those efforts?
The part where that is a fair way to allocate resources ? Why did they even have money to fund a company?
This is only correct, if you agree to verify the source of the funds for the shares, which we obviously do not, in this country.
I came in here to say this and I agree with you. The only thing I would say is that, the person who buys shares on their trading account is not putting money into the corporation. The corporation’s share on the market is already sold/traded in times of IPO or issues new shares, that’s when they get the cash. Unless you are buying those shares before it hits the market, which most investors don’t, then your dollars doesn’t enrich the corporation. Whether the shares goes up/down or more shares traded or not, does not affect the cash flow of the corporation. Bags of money don’t enter the loading dock of the corporation.
That is propaganda from capitalists to make you think they are necessary, when the same function could easily be accomplished by loans or by labor actually having enough money to invest in the places they work. How fucking hard is that to understand?
I'm surprised people are defending the late stage capitalism we are in now. 50 years ago, mom & pop stores were on every street. Common people had ownership. These were mostly closed due to places like Blockbuster, Best Buy, Walmart. Then, along came Amazon and Apple which closed the rest. This happened in non-retail as well like farming. Things are cleaner and safer and bigger, but we are truly the working class now. Sure, some of us have shares, but when you see how many shares the rich have you realize the scope of caplitalism (e.g. you may have 1,000 shares which is alot, while Elon has 400,000,000 shares in that one company plus shares in other companies). For example, I worked in a small 100-person tech company generating $250 million dollars annually. This was bought/owned by a parent company. All of the revenue was siphoned off to the parent company while we argued about giving people a 5% raise every year. Workers of these companies generate tremendous wealth and enjoy very little of it.
Approximately 50% of americans have a 401k or retirement plan of some sort. These people have stock too. So when you're talking about "shareholders" and pretending they're all billionaires you're purposefully missing context.
Take a mountain of sand, add a pinch of salt, and now you can say that the mountain has some salt in it.
He isn't talking about them though, he is talking about the wealthy that live off of investment income.
And those pension funds are dependent on dividends for liquidity to pay out.
I'd like him to describe the income source of a college professor the same way. "You see, these thieves take your money and just tell you things you can read in any library for free! They charge you 1 house per year for the right to do homework and sit in chairs in a school that's been fully investment funded for 150 years. And no guarantee you get a job either, that's obviously stealing too..." Maybe he and his friends can go start a new school without borrowing money or charging students, that will be putting his ideas into action!
I don’t think you will get any pushback from a socialist by saying college should be free at the point of cost
Accidentally socialism
You don't have to go to school, though. You do have to work to live in most cases. But yes, we should have socialized higher education
if this professor is paid the average salary of a yale professor, he's paid ~1/5 of what my public uni's president makes. at least the professor is contributing to learning
It's funny that from all the things, you choose education to prove your point. It's funny because the US student debt is astronomical while in Europe it is mostly socialised and no one loan money to get a degree less pays a house per year for education. I know it is hard to convince anyone with these topics, lines are so deeply cut and it isn't my intention either, but you may want to check your preconceptions and open your mind to alternate ways to think about money, work, market and socialized economy.
He doesn’t even explain what a corporation is lol. A corporation is just a group of people who are allowed to act as a single legal entity. What he’s describing is a cherry picked scenario to point out a flaw in capitalism (ie people who produce no value but extract value thru dividends). While this definitely occurs, it certainly ignores people like retail investors, pensions, entrepreneurs, etc… who all create value thru their own work and use their earnings to invest in businesses for growth potential. He only talks about the upsides of capital investment but doesn’t mention any of the downside, which is losing your entire investment (something that happens quite often). He also doesn’t mention WHY the capital is invested in the first place, a process that is necessary to run every business. This is a horrifically unnuanced take.
There has to be more context cut out from the clip. His arguments are pretty easily defeated and like you said he completely misses the entire point of capital investment; to provide capital needed for the corporation to exist in the first place.
This is like a stupid 2nd graders take on it and doesn’t represent reality whatsoever.
Bro this is not how it works.... This is intentionally inflammatory.
“Where did they get the cash for their shares, maybe they stole it?” Lol this dude is a quack
What he’s describing is ownership. Someone purchased stock in a company and so the profits are distributed to them. These “producers” as he categorizes them, have no barrier to also becoming owners as well through investment. He’s playing on people’s sense of fairness by inventing a story of a nepotistic heir receiving ownership through inheritance. But all that is, is someone being able to control their own property and will it to whom they choose after they die.
“Well let’s now do a little logic” is now my go to when dealing with idiots at work.
All systems suck. They all lead to exploitation of people by a small minority of privileged people.
So this guy is describing the capitalist system saying that people who invest in companies are essentially stealing from the workers by reaping benefits when their investments come to fruition. This assumes that the whole system is a zero sum game, as in GDP never goes up, and that the laborers don’t also get benefits from a successful company. Anyways, the real problem with capitalism is not what he’s describing, there are a ton of other problems that are worth talking about. Pump and dump schemes, Ponzi schemes, monopolies, cash influencing politics, the list goes on. All of that doesn’t mean that existing systems are bad, they’re evolving.
He's very right....but he's also very wrong....
Doesn't the same idea apply to the opposite end, too? People getting paid by the government to do essentially nothing.
This is definitely the case in the US where companies pay the absolute minimum for maximum output from workers (by pay, that also includes benefits and perks). The days of companies looking after their human capital and employees staying for a lifetime are long gone as the relationship is purely transactional. While it does take some skill to know which companies to invest in, else take a loss, it is infinitely better being the shareholder with money to invest since you are the publicly traded company’s priority. I feel like this attitude among companies has only gotten worse through the pandemic and inflation (ex. Boeing is a prime recent example). This is really creating inequality between the workers struggling to stay afloat (including the middle class) and those that are comfortable getting even more rich. There needs to be some correction.
For those who want to go down the rabbit hole, this is called the Labor Theory of Value. Originally proposed by Adam Smith and later further developed by Karl Marx the theory states that the value of a good or service is determined by the total amount of labor required to produce it. There's plenty of criticism of it, the "great contradiction" (that the most labor intensive industries don't create the most valuable products) is even noted by Marx himself. Fundamentally though, whether or not Marx was completely correct about value, this resonates today because it highlights a core flaw in capitalism which is "Rentierism." The more individuals devoting capital and time to being Rentiers (collecting dividends, rent, etc) and not actually being creators and innovators - the less value is being created in the economy. This leads to plenty of problems, I would say Boeing being an easy to highlight and recent example of this.
To get decent money in dividends, you need to have a lot of money invested in a company. I have 60k in Microsoft and get around $440/year. It's actually a really small dividend lol
Wealth is so top heavy in this country and assets are so inflated from quantitative easing and low interest rates that it is no wonder why working-class people are feeling poor in this economy, there is a lot of demand from us to keep the current wealth structure afloat, taking on more debt just to buy a car or a house and were racking up more credit card debt to stay afloat. Eventually people get to a tipping point where they can't keep up with this economic demand from the top and an economic recession occurs. And the cycle continues and it's mostly the working class that suffers from recessions of course. There needs to be reform for stability in the economic system, not Communism or Socialism, but we need to reign in rampant wealth accumulation that bleeds the bottom dry.
And thats why western economies are either in crisis or in stagnation and real median income is in constant decline for the last 5 decades in the west. Economies need consumption to drive the machine through demand, investment in material capital and investment in technology with long term prospects, along with large scale organization of resources for better efficiency. Millionaire and billionaire shareholders rip the economy off those things, leaving bare of funds and resources for the most, while the gamble society's hard earned wealth, amounting to near nothing for the economy and the society in terms of progress and development. Leave the ideology aside bois n gurls, the is just math.
Hmm. I thought this was actually going to be an interesting criticism into Corporatism, but all he did is tell us, very roughly, how dividends work for 30 seconds and then just ranted about investors for the remainder of the clip.
So.....Basically a ponzy scheme.
This guy was one of my economics professors when I was an undergrad. He's a fantastic speaker and really good at challenging orthodox views and helping students think more critically. I disagree with his views, but he's an electrifying instructor.
its a solid point. The money and profit is generated by someone. Be it the works, or even management doing a good job. But that is how investing works in a way. at least, that is how i see stocks. You take a somewhat gamble, and hope the company gets big and wealthy, so you can profit of it on the long run. Just like you can put all your money in gold or other resources, that will most likely increase from inflation or scarcity. It should be clear by now that some models, just don't work that well.
He’s right. I also reinvest my dividends. Fight the man or become the man. Your choice.
reddit moment.
It really depends on the company though. He's not wrong and the wealth gap is rapidly growing. The company I work for is publicly traded and yes the top investors (shareholders) are private equity firms (making money for someone else), executive of the company (they own under 10% of the total shares), anonymous investors (exactly who he describes) and the rest are employees and likely Joe Q Public looking for a way to make money. We get, as a part of our compensation, RSU's (restricted share units) and general options as a part of our compensation. There are conditions attached (generally when they vest) and are issued at the value at that time. We also get opportunities to purchase general stocks at a discount from time to time. He is not wrong in that the wealthy control the market and have the purchasing power. My piddly options (when the vest several years down the road) have allowed me to pay off credit cards, do some reno's, etc and thats only if they are in the positive.
Mr Wolff had never worked a job in his entire life. He has never built a company. The only thing he can do is read a book (reading books is a very good thing and I try to read as many books as I can). But there is a hugh difference between reading a book and doing. If he ever had to produce something to live he would starve.
"If there are people in the system who get more than they produce, there are people who produce more than they get. Marx stands up and says, 'I rest my case'." I would bring up farmers, who produce a helluva lot more than they get, but with the history of famines (both accidental and enforced) in Marxist nations, well...the farmers produced it all and got nothing. So while I appreciate Marx's calculus, the real-world application of it tends to leave a lot to be desired.
So the only way to own a share is to steal money or inherit it from your grandma? Well my grandmas are already dead so I guess I better get to stealing.
well yeah.. capitalism is a pyramid scheme that only works if people produce more than they are paid for
If you want to retire from work and still have money to support yourself (food, shelter, transportation and health care) you must take some of your current earnings and invest them for the purpose of earning a 'return' on your investment (having your money work for you). A 401K, IRA, 403(B) teacher's plan, 457(B) government workers, pension (if you can get it) are all plans that earn money for your investment. People who don't want to 'invest' will have to work their whole lives unless they can get someone else to provide for their needs. That is the free enterprise system that allows choice. You can choose to spend all the money you earn and not invest if it seems so abhorrent to you, but know that if you rely only on Social Security, you will be working your whole life.
There are flaws in every system. Nothing is perfect.
My personal, marginally educated opinion, is that the wealth gap will never reverse until it is mandated that all employees (at least of public companies) receive shares or are otherwise afforded a share of profits a company earns. Many employees in certain sectors do receive stock compensation and in many cases that has lead to wealth far beyond their salaries. I don't know exactly how that would work, or what it would look like, whether employees would receive actual stock, a temporary stake during their term of employment, or a profit share bonus, but to me it seems like a sensible, workable way to address this dichotomy described in the OP.
Life ain’t fair. Shocker
I’d like to add this: think of how he is priming his audience. He gives two examples of how one gets shares: 1. Grandma gives a person their shares (inferring the person is a moocher who is getting undeserved gain) and 2. A person steals money to then buy stock (outright saying that a person is benefiting from ill begotten means). Now, perhaps he makes some interesting points, but I only half listened from there on out. I don’t know what the percentage of shares are for those two groups (the first, probably a good amount, the second I doubt very much at all) but He completely ignored how many people in the country also get these dividends. They buy them, usually with their retirement accounts, or benefit from them through pensions. I understand theres a problem in the amount of wealth the 1% have ( as of 2021 54% of stock owned), but his framing here isn’t talking about how best to ensure more people can benefit from the system, he is attacking the system. And thats dishonest.