They're not happy about it. I think a lot of people make that decision under a form of (personal financial) duress. Or put better than I could, by the master of pithy observations:
The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money. Take boots, for example. ... A man who could afford fifty dollars had a pair of boots that'd still be keeping his feet dry in ten years' time, while a poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.
I don't think it's even that. Everyone has been burned by companies that charge for quality and provide less service than the cheapest option. See fast fashion. See Amazon scam reviews. My parents just had a window break- a skylight spontaneously shattered and got glass all over their kitchen. The warranty, a 20 year affair, had specific provisions for "spontaneous shattering" that covered the only way windows fail- and specially disclaimed the important selling point of safety glass, that it doesn't shatter into pieces that get everywhere - safety glass is supposed to stay in one piece, even when it spontaneously shatters. A crumply singular piece is far safer than being showered with shards of glass. Thank goodness nobody was home.
Fraud is the fastest growing sector in America, and until there are daily executions for fraud, we will not be getting better.
Safety glass just means the glass has added safety features - these can be of different types.
Laminated glass is a common one, with multiple layers of glass bonded together. If the glass is broken, the bonding material will (should) hold the glass together. This is presumably what the OP's glass was meant to be. This is common for skylights and automotive windshields.
Another type is toughened glass where the glass is treated (toughened) so that when it breaks it crumbles into small granular chunks that aren't sharp or dangerous in the way glass shards are. This is presumably what you were thinking about, and might have been what OP had installed based on their description of the failure. This is common in the passenger windows of cars.
It's common after an accident to see a broken but intact windshield (laminated glass) and other windows to be completely missing as they fragmented into small chunks (toughened).
There is also wire mesh glass, that you've probably seen in more industrial and commercial settings that is a lot more fire resistant than plain glass.
Depends on the glass and failure modes. On a car at highway collision speed? Sure, it's gonna crumble into lumps. In a house window? It'd damn better stay in one piece. Except... when it doesn't.
But what is the cost of happiness to the corporation? If you buy the $90 mower for which Walmart takes a cut of, and are unhappy about it, vs being happy about buying a $180 mower, if Walmart is making more money on the $90 mower, your happiness is irrelevant to the corporation. We see corporations where that's what makes their whole business model work. Spirit Airlines, Comcast, AT&T.
There, I said it. If Spirit Airlines didn't take advantage of people putting up with being miserable, they would not be viable as a business.
I bet the people that can only afford to fly Spirit are happy once they get to that exotic, faraway place that they couldn't otherwise afford to travel to. We'd all love to fly first class everywhere if we could.
(The drip pricing is a problem and probably needs some tegation or something, and more gates, noreairports, and more route competition. But that is a aseparate issue than deep budget airlines, which you see even in highly competitive markets.)
it's just wrong though, the reason why people are rich is that they have more income streams by producing more valuable things, not consuming less.
It's a nice idiom to have when you use labour to trade for income and your income doesn't increase by your efforts but the reason why people are rich is more based on their production than their consumption.
The analogy makes sense for middle class folk though, but a rich person will stay rich regardless of what they buy as long as their production output is stil desirable.
Is it really fair to say the rich “produce” anything? Having multiple income streams doesn’t at all imply you produce anything whatsoever - some people are born into money, some earned it in the past, every now and again someone wins the lottery.
I’m not saying the wealthy never make anything of value, but rather that wealth is not necessarily correlated to “output” of any kind.
having multiple income streams means you've (the you here is broad, could mean your company, your family trust etc) produced something people find valuable yeah. Producing can mean many things here - like a podcast episode is a "production", a youtube video is a production etc.
I don't dispute that many people are born into wealth, but over the past 20 years there has been more wealth produced in the world than ever before. There are more millionnaires and billionnaires than ever before, most of them were not born rich.
You don't become rich by reducing your expenses, you become rich by making something people want and monetizing it.
The family trust example is a good one, I think - because I think it illustrates my point rather well! What does the family trust “produce”?
We can say it allocates capital to other people who then produce things; and so they “produce” at a distance. I think a better description of that is “control” (or “influence” if you are feeling more charitable). They control what value is produced by others, through the trust.
Does the trust really create anything useful on their own, though? Is there value inherent in their control/influence? Is that an optimal way of allocating resources?
Personally, I don’t think so - I think it’s inefficient, and mostly serves as a way for the wealthy to extract rent (so to speak) from society.
I will admit that this is the only world I have ever known, so it’s hard for me to envision an alternate future. But, I don’t think that means what we have today is really a good idea - and I think recognizing who actually produces “value” in society is an important realization to have.
Who knows. The problem is that optimal resource allocation is not an objective concept. You make the argument that the family trust is dead weight, but I would disagree because someone has to do the allocation, and that is real work. Most of that work is done by analysts hired by the family office, and they would just be doing that work for another employer otherwise.
You could also make an argument that the person who has inherited and doesn't have to do any work is economic dead weight. And on that point I would agree with you. But the truth is that the number of people who inherit enough money to never work is vanishingly small. Top 1% in the US is net worth $10 million, and even that is only barely enough after estate tax if they have 1 child. Top 0.1% is 50 million, and that would do it for sure. So we may be losing 0.1 - 1 % of our potential economic productivity to this dead weight, but that's insignificant. And in reality, the people I know from school from families like that are all working anyway. Most rich parents don't want to support dead weight kids even if they can easily afford it.
You're right that the system we have is inefficient and most of it is not suited towards good allocation.
The family trust having that wealth has to have come from somewhere in the first place though - someone (probably you or your ancestor) has to have made something that people wanted and were willing to pay for (obviously this is in general terms, there are exceptions in unethical stuff like stealing etc)
I broadly agree with your critique of the current system we have - which is why sensible social safety nets should be established and a government should exist as a safeguard and as a check on it.
However, production is entirely different to distribution and we're talking about two different things. I'm talking about how an individual becomes and stays rich, you're talking about the system - I agree with the critiques of the system as a whole.
People get rich by creating something people want. It is not by buying higher quality products or w/e the quote implies. You can buy all the crappy products you want and still be rich as long as whatever you're producing is in demand.
> having multiple income streams means you've (the you here is broad, could mean your company, your family trust etc) produced something people find valuable yeah
Oh, dear. I can tell from reading your comments that it’s not gonna matter to try to argue with you, so I’ll just say that this is incredibly deeply profoundly naïve.
The point is that it’s incredibly deeply profoundly naive. It’s not an insult. It’s odd that you took it as one, since it wasn’t even directed at you. But hey, you seem to have gotten some satisfaction out of whatever that puffery immediately above was, so I’m glad I could help you get that off your chest.
> It’s not an insult. It’s odd that you took it as one
I don’t find that odd. Even if accurate, “naive” tends to have more negative connotations and typically codes as an insult.
I tend to find other ways to communicate that same information to someone when needed, even if it is less direct or less accurate: it ends up being better received. The communication winds up more successful overall.
That’s not the point. The point is that at some point there’s a quality quantum jump. If you can’t afford it, you’re always paying more. It's the same thing about buying in bulk. Yes, buying cereal from the warehouse club is cheaper per unit, but you have to be able to afford the 10 pounds of cereal, and the membership fee, and afford a place where you can store the 10 pounds. If you can’t, you’re stuck paying more per unit.
Or let’s take predatory check cashing places. No one should be lose 3% to 7% of their wages to literally cash a check, yet if you can’t carry the minimum savings amount, you can’t get a bank that won’t charge you a monthly “maintenance fee” (lol, like what “maintenance”are they doing? Polishing coins, and ironing bills?), so you lose 3% of your wages as a poor tax, whereas someone with a more lucrative job, keeps all of their take home pay.
FYI, the boxes of cereal at Costco weigh much less than 10 pounds, and are basically just two bags of cereal sold in a box at a grocery store put into one box, it is not onerous to buy or store assuming you have a car to transport it.
>yet if you can’t carry the minimum savings amount, you can’t get a bank that won’t charge you a monthly “maintenance fee” (lol, like what “maintenance”are they doing? Polishing coins, and ironing bills?),
Yes, operating a physical building, employing people, taking on liability all costs money. The US government could do its job and offer people free money transfer services if it wanted to ensure everyone had access to electronic money accounts. I do not see why one would expect a non charity to take up this responsibility.
IME Costco at least is not price competitive with typical grocery store private labels brands. Better quality? Sure, maybe, but they really don't compete at the "bagged discount cereal" price level AFAICT. In general Costco is usually 60% - 100% more expensive than my local HEB's HCF products.
Maybe our Warehouse Stores are run very differently? Not sure. Been awhile since I've gone to Sam's, maybe they compete in that price range.
And I just checked Chase, they charge $12 / month* for basic checking. (*Waived with just $500/month direct deposit, but let's ignore that.) If you're cashing more than $400/month, you should just sign up for it. ($400/month is deep, deep poverty level, like panhandling.) I'm sure there's people who don't get a real checking account and could benefit from it, but the reasons are probably more along thines of "ineligible to get a bank account" or math illiterate, not "too poor for the minimum balance requirements".
The whole idea is just ridiculous. The main consumer good people get screwed over like this is housing, but that's 60% screwing over the other 40%, not the top 1% vs the 99%, so most people don't see themselves in those terms.
You would have to compare prices for Costco's Kirkland brand to HEB's proprietary brand. Also, Costco's goal is not to be the lowest price. Their goal is to be the lowest price relative to the quality, and their claim is they do the due diligence of providing a minimum level of quality for their products such that the customer will be more likely to be satisfied with the product than at other stores.
Awfully convenient that their due diligence results in everyone spending a lot more money!
Seriously though I have no problem with them setting a minimum quality bar, but the idea that poor people would be rich but for their ability to shop at Costco is just wrong.
The reason people are still rich is the same reason nobody would watch sports if they didn’t reset the score at the end of each game.
“Today the New York Yankees will play the Montreal Expos. Our game begins with the Yankees having a score of 79,613 runs and the Expos having a score of 12,177 runs.”
If this is how baseball worked how much energy do you think the Yankees would spend recruiting a hot new pitcher versus starting one of the owners kids?
I'd like to add that those teams could have always been playing equally-well.
This phenomenon happens even in simpler models, where it's easy to see that the eventual "winner" is only there through pure long-term luck, with zero distinguishing merit or intelligence etc.:
> If you simulate this economy, a variant of the yard sale model, you will get a remarkable result: after a large number of transactions, one agent ends up as an “oligarch” holding practically all the wealth of the economy, and the other 999 end up with virtually nothing.
> It does not matter how much wealth people started with. It does not matter that all the coin flips were absolutely fair. It does not matter that the poorer agent's expected outcome was positive in each transaction, whereas that of the richer agent was negative. Any single agent in this economy could have become the oligarch—in fact, all had equal odds if they began with equal wealth. In that sense, there was equality of opportunity. But only one of them did become the oligarch, and all the others saw their average wealth decrease toward zero as they conducted more and more transactions. To add insult to injury, the lower someone's wealth ranking, the faster the decrease.
> I'd like to add that those teams could have always been playing equally-well.
Depending on how you count things, the Yankees were founded in either 1901 or 1903, while the Expos were created in the 1968 baseball expansion and started playing in 1969.
Without reseting the score for every game, there is simply no way for the Expos (now called the Washington Nationals) to ever have equality with the Yankees. (well, ok, it is possible but is just plain never going to happen).
At the end of the last (American) football season, the Green Bay Packers beat the Chicago Bears, and in doing so passed the Bears for the most all-time wins in professional (American) football, which is the first time ever that the Bears did not have the most all-time wins. The Bears are one of the founding teams, and the Packers joined the league in the second season. If the Bears and Packers both won 0 games for 4 straight years, the New York Giants would catch up with both of them. But only if they won all 16 games every year. Then again, the Giants joined the league in its 5th year. Is there any reasonable situation in which a non-first-decade team manages to catch up? No: it would take a generation of spectacularly bad performance by all the old clubs while at the same time a newer club needs to be spectacularly good the entire time!
I'm ideologically predisposed against centralization (including that of government), but I've still got to acknowledge the extreme slashing of tax rates that took place over the last several decades. Not only the income tax, but also the estate tax. Take a look back at the historical rates for both, and they're shocking compared to what we consider "high taxes" today.
These taxes were gutted under a pretend banner of limiting government, while government spending continued full steam ahead - including spending on mega subsidies to the financial industry by the federal reserve. Those taxes were all money that used to be recaptured by the government, now continually accumulating in private hands. The only reason we haven't had massive price inflation over the past several decades is that technological progress and outsourcing has made manufactured goods continually less expensive to produce. Instead the inflation has shown up in the "everything bubble", with asset prices mostly exempt from CPI, as ever-growing anti-productive wealth pools bid up ownership of our entire society.
Kids of the rich don't need to produce anything. Very often, they inherit the sense of entitlement to the riches, and none of the desire to create anything. At best, they are immersed in the lazy loop of self-gratification; at worst they are scheming how to destroy things and grab as much as possible from the ruins.
That was meant to be funny thought process of a simple man (Vimes). That was not supposed to be everything explaining economical analyses.
In those book, Vimes is practical simple man with little time for big picture side of things. He deals with what is immediately around him and never really cares about root causes or anything like that.
