2
$\begingroup$

If you think this is going to lead to answers which are too speculative, let me know, but I think it should be possible to at least make some strong educated guesses...

What would happen if there was a one-time redistribution of wealth from the wealthiest 1% of people in the US to the other 99% of people?

I was directed to this question on the website “Quora” by a friend the other day, and the answer posted there made me want to bang my head against the wall. I don’t want to say what it was because I don’t want to bias the answers, but it basically led to a never ending back-and-forth between my friend and myself, so I thought it was time to ask some qualified people to weigh in.

What would happen? I’m interested in both short-term and long-term consequences (as well as possible large-scale psychological consequences, though those might be outside the scope of this site).

With my friend we discussed whether it would be different depending on whether the 1%’s assets were first sold, then distributed, or first distributed, then sold. We discussed whether there would be buyers for the assets, given that those who previously had the most money now have none in this scenario. (Of course there could be buyers from foreign markets). We discussed whether it would affect employment and lending, given that the 1% by and large own businesses which employ a lot of people. We discussed whether various groups of people would choose to keep working and what kind of effect that would have.

You can find the stats to calculate this on the Internet, but just to speed things along, the numbers would wind up being a little under 100k per person (if minors are included).

I want to clarify that this was not (I hope) posed as a real suggestion - because robbing people of their assets just because they’ve been more successful than other people seems obviously morally wrong - the question is whether, in a practical sense, the consequences of this scenario would be good or bad overall, for the average individual, and for humanity as a whole, long-term.

Edit:

Assume that:

  1. The total net worth of the USA is $84 trillion.

  2. The population of the USA is 323 million.

  3. The “wealthiest 1%” is any individual possessing $8 million or more in total assets.

  4. The “wealthiest 1%” controls 38% of the nation’s wealth.

  5. The time period is 2018.

  6. The mechanism is government.

$\endgroup$

closed as primarily opinion-based by EnergyNumbers, Giskard, london, Herr K., Maarten Punt Jan 15 '18 at 12:52

Many good questions generate some degree of opinion based on expert experience, but answers to this question will tend to be almost entirely based on opinions, rather than facts, references, or specific expertise. If this question can be reworded to fit the rules in the help center, please edit the question.

  • 1
    $\begingroup$ If something is "obviously morally wrong", it's probably much more complicated than you've considered. Also, unless you've got a circular definition of "successful", "more assets" is not equivalent to "more successful" $\endgroup$ – EnergyNumbers Jan 10 '18 at 8:51
  • $\begingroup$ @EnergyNumbers I disagree with both of those things. I have not begun to scratch the surface of the complexity with the elements I mentioned in the body of the question - I merely selected the things to mention which I thought wouldn’t be immediately obvious, and would therefore aid in thinking about the problem. As to the other - to a degree, people define their own successfulness. However, material assets are certainly a good measure of FINANCIAL success, especially when you consider whether their trend has been to increase or decrease their own net worth over time. $\endgroup$ – MAA Jan 10 '18 at 9:02
  • $\begingroup$ You write: "I have not begun to scratch the surface of the complexity with the elements I mentioned in the body of the question", and indeed you haven't. That why I've voted to close this as too broad. It's too large a question for a decent PhD thesis, let alone a question on this site. $\endgroup$ – EnergyNumbers Jan 10 '18 at 9:41
  • 1
    $\begingroup$ @EnergyNumbers it may be a question of large scope - but it isn’t broad, it’s highly specific. And I believe relevant and important to address, because it seems to me to represent a widespread sickness in people’s thinking about economic issues in general, and would be of tremendous benefit to realistically analyze. I request that you leave this question open so that if someone thinks it is worth the work to answer it, we can all reap the benefit. $\endgroup$ – MAA Jan 10 '18 at 9:46
  • 1
    $\begingroup$ You probably end up writing a book by the time you get to the bottom of the answers. The complete answer may need to be supported by a scenario-based approach because of the scope and the depthth of the issues you are going to deal with in each scenario. Also, albeit poor analogy, this is reminiscent of the 'experiment' Bolsheviks conducted to impose Marxist ideology in Soviet Union. $\endgroup$ – london Jan 10 '18 at 12:35