Explaining the Ehrlich Simon bet once again and why Limits to Growth was wrong

Most of us are familiar with the story of the Ehrlich Simon bet (for those who aren't, details here.) Essentially, are minerals going to get ever more expensive as they run out or are we going to become ever more ingenious in our methods of finding them and extracting them so that they become cheaper? Bet on how prices move over a decade and see: Simon, taking the ever cheaper stance, wins and wins handily.

Don Boudreaux points us to a good review of a book on the subject and it contains all of the usual arguments about why Simon won. It's worth however looking at the details of exactly why Simon won.

The three metals that declined substantially in price over the decade were copper, tin and tungsten. Why?

The 80s saw the introduction of SX-EW for copper oxide ores. Before this we, as a species, had only extracted copper from sulphide ores. The alteration of an already known technique to work with copper oxide ores meant that large mountains of that material became usable to us. This is very much Simon's point about increasing ingenuity.

It also saw the collapse of the ITC, the commodity board keeping the tin price well above market clearing levels. And for tungsten the end of Maoist insanity in China led to increased mining and export from that country.

Simon did not, by any means, predict these three events. Rather, at heart, his bet was that enough of these sorts of things would happen over a decade that a basket of minerals would fall in price. It's not about the specifics at all: it's about the general trend driven by ever advancing technology.

Then there's this:

The state had to intervene massively to control population and save mankind. Commenting on the 1972 The Limits to Growth by the Club of Rome, a catastrophist monument by itself, zoology professor Bertram Murray said that “collapse is inevitable,” and that a new economic system was needed, “highly regulated,” and “managed by an international team of planners.”

To someone actually in the minerals business that Limits to Growth report is very strange. For there's an obvious mistake made in one of the basic assumptions. One that invalidates everything that comes after it. At least as far as minerals are concerned it is, quite simply, entirely wrong.

The assumption is this: total mineral availability will be ten times mineral reserves.

Seems simple enough but that's the horrible, glaring, error at the heart of the entire report.

Mineral reserves are the working stock of mines currently in production and those just about to go into production. It costs a lot of money to "prove" a reserve to the required legal and technical standard. We tend to therefore do so only for those minerals that we're going to dig up in the next 20-50 years. The time value of money is such that it's much cheaper to leave stuff we're not going to use in that timescale over in mineral resources (what we're pretty sure we can use but haven't "proven") or just in stuff we've not really looked at very closely.

And there is no relationship, no relationship at all, between the amount of stock we have in reserves and what there is in resources or total resources. Simply none: there are no reserves of gallium, germanium or indium, total resources are so vast we'll never use them. There are 30-60 years reserves of potassium and phosphorous, 1,500 and 13,000 year resources of them and total resources amounting to 0.2 and 2.5% of the entire surface of the planet.

There is simply no relationship at all between mineral reserves and the amount available for us to use in the future.

But note what happens if we assume that total resources are 10 times mineral reserves. Our reserves are, for those financial reasons, 30-50 years' worth of usage. We assume that there's only 10 times that available in total. Add in a bit of compound growth of usage and suddenly we're predicting that everything will run out in 150-200 years' time. What did the Club of Rome predict in Limits to Growth? That everything would run out in 150-200 years' time. Why? Because they assumed that total availability is only 10 times reserves.

It's all entirely horse puckey. And we really shouldn't be planning the future of the world or of the economy on such ordure. But somehow we are: more's the pity.

The problem with Uber is that there's no there there

That Uber, the limo and taxi replacement application, has just been valued at $17 billion ($18.2 after the cash actually hits) as they raise another round of investment is all terribly exciting of course. It's also evidence of the vibrancy of technological change at present. The company is only four years old, after all. And it's further evidence of the way that the Silicon Valley ecosystem, especially its financing, enables companies to gain the capital they need to expand.

However, there is a certain amount of headscratching going on. Because there's really no "there" there. What is it that Uber has that is worth so much?

No, we don't mean the basic business model itself: that's just dandy. It disintermediates around the regulation and taxation of the current limo and taxi systems, this is good. Just the idea of electronic hailing increases capacity utilisation and thus overall system efficiency, this is also good. Passengers pay less, drivers earn more, Uber gets its slice, these are all good things.

But wherre is Uber's edge? Fo9r what appears to have been forgotten here is the most basic point about business and competition. A great business model is not the same thing as a great economic model for a business. That latter is something that achieves the above: makes producers and consumers better off at the same time, we really love these sorts of things. But a great business model does this and also protects itself from competition. And that's the thing Uber cannot do.

It's easy enough (as hundreds of companies are showing) to write the basic app that performs the heart of the service. Most drivers in any one of them are in several of them at present. There's not much reason for consumers to be loyal to any one or other of these services. There seems to be no way to stop competition once the value of the basic model has been proven.

Of course, for all of us this is just great: who cares about the producers? We care about the consumption opportunity and as that competition brings the prieds down and down again then we will all benefit.

But it appears that people are valuing Uber for the joy and genius of the model itself, not for what is actually important for a business, how much of that value can they appropriate for the business from that model? And in the long term it's very difficult indeed to see that competition won't reduce margins down to the cost of providing the srvice. Or, as often happens in feeding frenzies over new ideas, below it.

We the consumers make out like bandits of course but it's odd to see this same mistake being made over again by investors. There's no patent lockin, no network effects, no protection from comt#petition. So why the gargantuan valuation?

Retrospective taxation and the rule of law

The UK is considering legislation to prevent people creating multiple trusts in order to pass wealth on to their family free of tax. Setting up a tax-exempt trust as a way of avoiding inheritance tax is very common – particularly when the tax is levied at 40%, and now that rising house values are taking so many families into the tax.

New HM Revenue & Customs rules will make it no longer possible to set up several trusts, each with its own tax-free allowance of up to £325,000. The new rules will come into force in 2015. But in order to prevent a rush of people creating new trusts, the reforms will apply retrospectively to all trusts established since June 6.

Well, there you go again. It is quickly becoming obvious that the rule of law does not apply to UK taxation any more. Already, schemes under which people arrange their affairs in 'tax efficient' ways that are perfectly in line with the UK's (absurdly long and complex) tax code, are being struck down by HMRC, simply because they are arrangements designed to reduce a person's tax bill. And now, it seems, HMRC can now make up new rules and make them apply to actions that take place even before the rules are put in place.

This is a mediaeval attitude to justice, redolent of the age of Morton's Fork. That was the ingenious design of John Morton, Archbishop of Canterbury in the 15th century, who argued that a man living modestly must have plenty of money saved and could therefore be taxed, while a man living extravagantly was so obviously rich that he could easily afford to be taxed.

Retrospective legislation is not confined to tax law. A 2013 House of Commons Standard Note, Number SN/PC/06454, lists many examples, all since 1996 – covering tax on caravans, compensation for mesothelioma, British activities in Antarctica and wireless licence fees. Retrospective liability for war crimes was introduced in 1991. The Conservative minister Nick Herbert used emergency legislation to reverse a High Court ruling on detention. And the Conservative Health Secretary Jeremy Hunt in 2012 retrospectively validated the authority of clinicians to detain people under the Mental Health Act.

Most of these measures were done for good reasons (rather than to raise money, as the tax changes have been). That does not make them any less of an affront to justice. You cannot be guilty of something that was not a crime at the time. The detention of a person by an unauthorised official does not become legitimate by backdating that authorisation. Unless the law is known and certain, there can be no justice. I predict, not a rush of new family trusts being formed, but a rush of tax advisers petitioning the High Court on this very point.

Liberalism Unrelinquished: An interview with Dan Klein

Liberalism Unrelinquished (LU), is a new project by Prof Daniel Klein and Kevin Frei which aims to reclaim the word 'liberal' from those people who want to 'governmentalize' social affairs. So far it has been signed by around 350 people, including Alan Macfarlane, Charles Murray, Deirdre McCloskey, Richard Epstein, and Alan Charles Kors — as well as several members of the ASI. Dan spoke at the ASI back in 2012 on“Mere Libertarianism”, his synthesis of Hayekian and Rothbardian strands of libertarianism. I reviewed his rather excellent book Knowledge and Coordination here. I spoke to Dan about his new project. Bio: Daniel Klein is a professor of economics at George Mason University (where he leads a program in Adam Smith), the JIN Chair at the Mercatus Center at GMU, a fellow of the Ratio Institute in Stockholm, editor of Econ Journal Watch, and the author of Knowledge and Coordination: A Liberal Interpretation(Oxford University Press, 2012).

What is Liberalism Unrelinquished (LU)?

LU is a declaration of no surrender on the word liberal. The 250-word Statement is as follows:

In the 17th and 18th centuries there was an ascendant cultural outlook that may be termed the liberal outlook. It was best represented by the Scottish enlightenment, especially Adam Smith, and it flowed into a liberal era, which came to be represented politically by people like Richard Cobden, William Gladstone, and John Bright. The liberal outlook revolved around a number of central terms (in English-language discourse, the context of the semantic issue that concerns us).

Especially from 1880 there began an undoing of the meaning of the central terms, among them the word liberal. The tendency of the trends of the past 130 years has been toward the governmentalization of social affairs. The tendency exploded during the First World War, the Interwar Years, and the Second World War. After the Second World War the most extreme forms of governmentalization were pushed back and there have since been movements against the governmentalization trend. But by no means has the original liberal outlook been restored to its earlier cultural standing. The semantic catastrophes of the period 1880-1940 persist, and today, amidst the confusion of tongues, governmentalization continues to hold its ground and even creep forward. For the term liberal, in particular, it is especially in the United States and Canada that the term is used in ways to which we take exception.

We the undersigned affirm the original arc of liberalism, and the intention not to relinquish the term liberal to the trends, semantic and institutional, toward the governmentalization of social affairs.

Thus far, about 350 people have signed the statement.

You speak of "governmentalization." What’s that?

“Governmentalization” captures things beyond interventionist restrictions and taxation, such as the role of government or governmentally subsidized institutions in the culture -- government as benefactor, employer, and on-the-field player in commerce, industry, and finance. Government as big player. That comes only from coercive power, of course, but too often critics of governmentalization focus on the coercion and not enough on the resultant cultural power. Government is a ginormous player in social affairs. It both rams and beguiles its way into cultural spaces, to self-validate. Government as cultural vortex. Look at what has become of France, despite its rich history of liberal intellectuals.

What made you decide to start Liberalism Unrelinquished?

Kevin Frei and I started it. Kevin emailed me to propose a Liberalism Day, to talk up the original political meaning of liberal. That morphed into Liberalism Unrelinquished, executed mainly by Kevin, though I drafted the Statement. We approached five individuals as initial signers — Deirdre McCloskey, Stephen Davies, Richard Epstein, James Otteson, and Mario Rizzo. That set the ball rolling.

Why should we care about what word we use to describe ourselves?

The word liberal is powerful. It relates to liberty and toleration, reflected in to liberalize. Words have histories that a generation or two cannot undo. A word has cognates and connotations that make our language cohere, more than we know, more than dictionary definitions can tell.

We need a wider understanding of the semantic changes of the 1880-1940 period. In a way, semantic issues are the momentous issues of our times; semantics tell who and what we are, our selfhood; they condition how we justify our everyday activities.

I’ve heard a few people object that you’re trying to be prescriptivist about the word liberal – that, rightly or wrongly, the word’s meaning has changed and it’s pointless to try to undo that. And you say?

When words hit home everyone is prescriptivist. People who say “That’s just a semantic issue” don’t seem to have thought very deeply about the importance of semantic issues.

If T.H. Green and L.T. Hobhouse could affect how words are used, what they are taken to mean, why shouldn’t we try to do the same when doing so would be to the good? LU does not force anyone to learn about the original political meaning of liberal. People choose for themselves what semantics to practice.

Can you tell me about the differences between ‘liberalism’ and ‘libertarianism’, as you see them? Are there liberals who could not be described as libertarians, and vice-versa?

Since age 16 or 17 I’ve been raised up on American-style libertarianism. As I see it, there is a narrow sense and a better, broader sense. The better sense, to me, rediscovers the outlook of Adam Smith. But the narrow sense of Murray Rothbard, for example, certainly has some tensions with the broader sense (from me on such tensions: one, two, three, four, five). I like to think that libertarianism grows more Smithian; in that sense I don’t see it as a matter of liberalism versus libertarianism.

Are you trying to effect a change within the libertarian movement, or among members of the centre-left who describe themselves as liberal?

The left gains enormously by getting away with calling itself “liberal,” so getting them to give up the goods is not even a prayer. Partly, I just want to self-declare, like Popeye, “I yam what I yam.” An Adam Smith liberal; a lovely little subculture. Next, I’d love to see the center-left, in the US, the Democratic Party people, be called by others something other than “liberal” simpliciter. Progressive, Democratic, social democratic, leftist, or left-liberal – all good. It is unfortunate that so many non-leftists comply with the self-description assumed by the left. For some 100 years the left/center-left dominated the cultural institutions. If non-leftists didn’t go along with their self-description, they were excluded. Then it took on a life of its own, and Republicans and libertarians are now surrendering “liberal.”

Why is LU generally restricted to over-30s?

Just to put some bounds on it. Wisdom comes with age …

In what countries do you think LU is most relevant? I’ve noticed that in the US ‘liberal’ usually means something like ‘progressive’, whereas in Europe it still generally has its old meaning. In the UK we’re a little bit in between.

I’m learning that, within the English-speaking countries, “liberal” means center-left most in the US and Canada, and that it retains its original political meaning most in Australia and New Zealand. Though I’m really not sure about India, South Africa, Hong Kong, and elsewhere. Yes, the UK is in between. In most of Europe liberal still principally retains its original political meaning.

Discourse from North America extends globally, so I think LU is relevant globally. Although our recruiting has been directed only to those in English-speaking countries, people from other countries, too, have signed on.

Do you think ‘liberalism’ implies a greater sympathy with redistributive public policies than ‘libertarianism’? Where do you see the ‘Bleeding Heart Libertarians’ fitting in to the ‘liberal’ nexus?

I think that Adam Smith liberalism is more flexible, more pragmatic generally, so yes. But I wouldn’t say that Adam Smith liberalism is positively friendly toward redistribution by government coercion. The attitude is more one of compromise.

As for the “Bleeding Heart Libertarians,” I am a fan. I think they are right (and concordant with Smith) that justice should not be confined to commutative justice (CJ). For justice beyond CJ they use “social justice.” I wouldn’t use that term, I’d use “estimative justice” for what they are talking about. But still I like what they are doing.

Do you have any thoughts about how political discourse will change in the future?

The left has a penchant to protest against "the unjust system." But we are wising up to the fact that, to a great and increasing extent, they are the system. The establishment, the status quo, is one of long-standing governmentalization of social affairs. If "conservative" means conserving the way things have been, the term increasingly fits governmentalization, since the trend is well over a century old. The establishment is one of governmentalization and hence cronyism and apparatchism. Since, let's face it, the left is basically about leaning toward governmentalization, more and more it is the left who are the conservatives, strictly speaking. What will come of this? I hope it starts to gnaw on their conscience, and that there is a reconsideration of what it means to be liberal.

Do you think the current left-right dichotomy makes sense and will it last?

The left/center-left dominated discourse. They determined semantics as follows: We the left are the humane ones. If you are not one of us, you are “the right” or “conservative.” So really there is the left and an everything-else category. Whether we can overcome the iron cage of leftist semantics is to be seen. Learning more about the original political meaning of the term liberal, 1769-1880, is a start (from me on that here).

The Statement says that the meaning of many ‘central terms’ fell into confusion during the 1880-1940 period. What terms?

The core set are: liberty, freedom, justice, property, contract, equality, as well as liberal. It was those terms, it seems to me, that confusion most befell. A second set would include equity, rights, law, rule of law, force/coercion, and privilege.

What should people read if they want to learn more about liberalism?

At LU (here), Kevin and I compiled a list of sources on the history of classical liberalism. Let me also offer my short piece “What Should Liberals Liberalize?,” needling left-liberals for failing to promote liberalizations that would promote what they claim to care about. But I see Smith’s The Theory of Moral Sentiments as the most important work of liberalism.

Where do you think the semantic shift that LU wants is most likely to happen – academia, journalism, online, or somewhere else?

The Adam Smith Institute and the Institute of Economic Affairs!

Organic is both bad for you and the environment

Organic food often tastes better, this is true: but it's also often worse for you and the environment as well. This leaves it entireoly up to you aws to what you wish to prioritise. Save the planet and yourself or go down with the smile of the well and tastefully fed?

That we're all told something different, that organic is better for the environment and for us is just one of those great lies of the modern world. The most obvious manner in which it's worse for the environment is that it requires more land. Thus for any given amount of land to feed any given number of people there's less land we can leave wild for nature itself to play with. But the organic practices themselves can also be dangerous to both the land and us:

That hits on a critical issue for organic farming, as noted in a 2012 analysis of more than 100 studies of farming methods across Europe: Getting the same unit production from organic farming tended to lead to "higher ammonia emissions, nitrogen leaching and nitrous oxide emissions." And while organic farming tends to use less energy, it also leads to "higher land use, eutrophication potential" -- that's the dead zones mentioned above -- "and acidification potential per product unit."

And as ever, those "chemicals" left on food as a result of conventional practices. 99.9% of the pesticides in any and every piece of food are the natural defences of the plants to parasite and symbiote attacks. What may or may not be there as a result of human action is so small as to be immaterial.

Organic: opften tastes better, is worse for the environment and possibly worse for you:

Some types of organic production, notably the use of manure concentrations, actually lead to higher levels of toxins in food. One study in Belgium found that organically cultivated winter wheat had higher levels of lead and cadmium than conventionally grown wheat.

Entirely your choice, of course.

So that's the housing shortage solved then

This is just excellent news, the Labour Party seems to have figured out what's wrong with the UK housing market.

Sir Michael Lyons told the Guardian he had identified protracted delays in the release of land as the single biggest cause of Britain's housing crisis.

Hurrah!.

We have no shortage of land in the UK, only 3% of the country is housing and under 10% is developed in any manner whatsoever. So there's plenty of room to increase housing by, say, 25%, for that would take some 1% of the country. This really isn't a land shortage.

However, what we do have is a shortage of land that people are allowed to build housing upon. It is this which makes housing itself so expensive: the scarcity value of the permission slip to build a house on a particular piece of land. So, issue more permission slips more quickly and that scarcity value will fall.

Yes, we know, we've been saying this ad nauseam this past decade. You're getting sick of hearing it and we're getting very bored with saying it. But if even the Labour Party's housing investigation committee is now coming around to this idea than obviously our repetition has not been in vain.

If not enough permission slips to build houses makes housing expensive then the answer is to issue more permission slips.

It's so simple an idea that even Labour are managing to get it.

Jackie Ashley has seen the future of the NHS and it works!

I think it's quite lovely that Jackie Ashley of The Guardian has been able to see the future of the NHS. Not just that, she says that it works!

It's in a sprawling house in Twickenham, west London, housing a staff of 30 in former bedrooms. It doesn't look much like the future of healthcare in Britain, but at a time when the debate rages about NHS charges, privatisation and scarce resources, this organisation could provide part of the answer.

Excellent, so what is it that they're doing? Well, there's a charity which provides some health care that the NHS doesn't, or which it provides not very well. They get some cash from the NHS itself, some from various people who think they're doing good stuff and none at all from patients. So, free at the point of use health care but not being provided by the monolith of the NHS. You know, just like hospices which most agree do a pretty good job as well.

So now here's the rub. How is INS financed, and how can it be spread nationwide? Its founding principle is that treatment is free to all of those who need it. It receives £250,000 a year from the NHS, and the salary of the chief executive, Ann Bond, and one of the two fundraisers are paid from the Big Lottery fund. As it happens, the charity's contract comes up for renewal in a year's time. If Big Lottery doesn't renew this funding it would be a big mistake.

Excellent we could say.

At the core of this success story is flexibility – what the patients want. There is no talk of outcomes, waiting times, service provision and the rest of the NHS jargon. Above all, there is no talk of profit. Profit is the last thing that would motivate staff – their reward is seeing the progress of their patients, and in simply continuing, year on year, to provide that help. This is absolutely not a privatised service, unlike Hinchingbrooke hospital in Cambridgeshire, run by Circle group. INS started from the bottom – two therapists who saw a desperate need in the community. It has been nurtured by the local community, with many volunteers helping to raise funds. Ultimately, it will only be sustained by NHS contracts, lottery money and community spirit. Surely, until the great British public is prepared to pay high enough taxes to fund the NHS properly, it is part of the future.

Well, actually, it's exactly what the current reforms of the NHS management system are trying to encourage. Other providers, whether charitable, for profit, even state owned, offer services which are then paid for by the tax take that funds the NHS. Allowing exactly this sort of experimentation outside the centralised management structures of that NHS.

What would Confucius have made of UKTI?

Far be it for me to belabour the UK Trade and Investment quango: I seek only to help.  In that context my attention was drawn to UKTI’s 1st Edition of “Doing Business in China”, their 164 page guide.  It would not have impressed Confucius.

Quite soon (p.24) the novice SME exporter gets to this advice:

Do you know the answers to the following questions before you start venturing into China:

• What are the unique selling points to [sic] your business proposition? • Will there be a market for your product and services? • Are there any legal barriers to your business model? • Where in China would you start? • Do you have sufficient resources (management time, project finance and expenses) to fund your China projects? • Who will be leading the project within your company? • Do you need to work with a partner in China to succeed? • Can you communicate with them effectively? • Have you evaluated business risks (such as protecting your IP) and conducted research and due diligence? • Do you know how to secure payment and get the right quality products? • Would Hong Kong be a safer place to start?

It seems that no British SME should even consider visiting China, soon to be the largest market in the world, without knowing the answers to all those questions. How on earth could a novice exporter answer those questions without visiting China? What world is UKTI living in?

None of the producers of this guide are Chinese and, although the usually admirable China Britain Business Council have had a hand in it, there is no sign the producers have any relevant experience.  There is no bibliography which might point novice exporters to China guides with better foundations.

We should not belabour UKTI but try to help.  And especially try to help them focus their limited resources in the most productive way.  They could begin by burning this book and starting again.

Tim Ambler is a co-author of Doing Business in China, published by Routledge (2010, 3rd edition).

Perhaps we should be scientific rather than all of this chaos of markets?

As we all know there are plenty of people out there who think that we should do away with this chaos and disorder of markets and properly plan things. This scientific socialism idea, that clever people acting altruistically will be able to determine what we should all be doing. It's not so much that such people don't grasp the point of markets, it's that they're not doing very well in understanding science.

From The Science of Discworld IV:

There is a common misconception of the scientific method, in which it is argued that there is no such thing because specific scientists stuck to their guns despite apparent contrary evidence. So science is just another belief system, right?

Not entirely. The mistake is to focus on the conservatism and arrogance of individuals. who often fail to confiorm to the scientific ideal. When they turn out to have been right all along we hail them as maverick geniuses; when they don't, we forget their views and move on. And that's how the real scientific method works. All the other scientists keep the individuals in check.

The beauty of this set up is that is would work even if no individual operated according to the ideal model of dispassionate science. Each scientist could have personal biases- indeed, it seems likely they do- and the scientific process would still follow a universe-centered trajectory. When a scientist proposes a new theory, a new idea, other scientists seldom rush to congratulate him or her for such a wonderful thought. Instead, they try very hard to shoot it down. Usually, the scientists proposing the idea has already done the same thing. It's much better to catch the flaw yourself, before publication, than to risk public humiliation when someone else notices it.

In short, you can be objective about what everyone else is doing even if you are subjective about your own work. So it is not the actions of particular individuals that produce something close to the textbook scientific method. It is the overall activity of the community of scientists, where the emphasis is on spotting mistakes and trying to find something better. It only takes one bright scientist to notice a mistaken assumption. A PhD student can prove a Nobel prize-winner wrong.

It occurs to me that you'd only have to tweak that a little to make it a description of markets. The "market" is the community in which things are tried, we use profit (as a synonym for satisfying consumer desires) instead of reputation but other than that it's remarkable how similar the two structures are. Given which we can thus see why that centralised planning doesn't work. For to gain either useful science or a useful economy we need to use that try it and test it method of working out what does actually work.

As an example, Lysenko was just as damaging to Soviet biology as GOSPLAN was to the Soviet economy.

More on how inheritance is becoming less important

One of Piketty's little insistences is that inheritance already plays a much more important part in who is rich that it used to in mid-century. And, of course, that this is bad. And thus our little picture of Ms. Hilton. For as far as I know she's famous for being an heiress. But also, at least as far as I know, she's not inherited. She has however made her own fortune by being known as a future heiress. Which doesn't really support Piketty all that much.

Further, via Marginal Revolution, we get this:

Using estate tax returns data, we observe that the share of women among the very wealthy in the United States peaked in the late 1960s at nearly one-half and then declined to one-third. We argue that this pattern reflects changes in the importance of dynastic wealth, with the share of women proxying for inherited wealth. If so, wealth mobility decreased until the 1970s and rose thereafter. Such an interpretation is consistent with technological change driving long-term trends in mobility and inequality, as well as the recent divergence between top wealth and top income shares documented elsewhere.

It is of course possible that all sorts of dire things will happen in the future but shouldn't we be asking for at least some evidence that they are going to happen, that there are really some trends likely to make them happen, before we drive the rich into penury just because lefties like doing so?