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The Zero-Sum Fallacy is but one fallacy - Elf M. Sternberg
The Zero-Sum Fallacy is but one fallacy
Every morning, there's a ten-minute drive between my house and the local light rail station that takes me into the city and my day job. It's not long enough to be memorable, or short enough to avoid, so I tend to flip through the radio on the way to work, and since out of the give talk show stations in Seattle three are conservative, one is "conservative," and one is NPR (which is about as liberal as its corporate sponsors want it to be), I tend to get an earful of the right's zeitgeist.

They were really depressed this morning. Not one of them can see a way out of the mess Donald Trump's primary supporters have gotten them into. One guy, though, was putting on a brave face.

It's a common trope on the left that right-wing talkers take their own worst sins and project them onto others. It's well-documented that white people see racial equality as a zero-sum game: the granting of privilege to minorities is seen as a loss for white people. (And it's quite real; in all of the "he says what we're all thinking" commentary on Donald Trump, one thing these people feel deeply is the pain of not being allowed to mistreat minorities or women without obloquy. They miss that, a lot.) So when I heard a right-wing talker use the phrase "zero sum," I let the radio dial lie.

"Leftists believe in the zero-sum fallacy," he said. "They believe that if one group is making a lot of money, they must be taking it away from others. They don't believe in growth. This is why the right doesn't care about the 1%. You shouldn't care about the 1%. Fear of the 1% exists only because of the zero-sum fallacy."

Well, no, I wanted to explain. There are actually worse things than a zero-sum game. We could have growth, and the 1% could be sucking up all of the newly-generated returns, leaving nothing for the rest, which is exactly what's been happening for 40 years. Because r > g (The rate of return on capital is greater than the rate of economic growth, and regulatory capture dictates that it will stay that way for the foreseeable future), money generated through growth gravitates toward the biggest deposits, resulting in corporate fiefdoms, massive index pools, and more regulatory capture.

The 1% own 36.4 of the wealth. And here's the real problem: The rest of us simply don't believe the 1% generate the kind of economic growth that justifies allocating that much of the nation's ongoing income toward them. We don't believe that the CEO really generates 200 times the amount of wealth for a company as a factory floor worker. There are only so many hours in a day; the CEO can't create 200 times as much money per day, every day, compared to the steady output of labor.

Rich people don't really create jobs. Entrepreneurs do, but they're not "rich" people; they're entrepreneurs, who could be anywhere in the cash cycle from wealthy to indebted. It is the middle class, not the rich, that make the economy grow.

All of which is to say that one shouldn't listen to right-wing radio.

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