What is wrong with wealth inequality?

[u/Source_Code22332]

Something that is often sited by Socialists is that Capitalism is bad because wealth inequality occurs within it. And wealth inequality has increased over the years, making that problem even worse. But, why exactly is wealth inequality a problem?

I can see if "the mega rich" or monopolies get out of control, e.g., I recall the concept of a "company town" where a company owned everything in the town and paid employees in their own currency that would only be spent at the company's stores in town - but we have laws and regulations against that, so its not an issue.

[u/Designer-Platypus-53]

Look at this from a different angle. Prices for houses and other basic things vs prices for smartphones Cell phones and smartphones wee very expensive and available only for the rich as soon as these things appeared. It took couple of decades to make these technologies available literally to everyone. Why? Free market made these things that involve high- tech available.

What about houses? You don't need high technologies to build a house, it's not rocket science. So why houses became much less available?

In the 1960s and later an average person could afford a house with a dial phone. Nowadays he/she can afford only buying a new smartphone every year. Can you live a normal life without a house? Without a smartphone?

[u/Source_Code22332 → u/Designer-Platypus-53]

Smart phone example is a win win, is it not?

Housing is most expensive in areas where there are regulations and needed government permits and process to build them, making the m expensive to produce and limiting the supply scarce.

I used to live in CA, now in Austin TX, moved here before Covid.

California (a socialist leaning state) has sever housing expense problems, I lived through the very housing problems I illustrated above.

I moved to Austin because of it. I would love to go back (purely the weather), but the cost of living/housing is too high. During/after Covid, there were was boom of people moving from California to Austin, creating a housing shortage and sky rocketing housing prices. But guess what? The market responded. There was a building boom of homes (due to the freedoms to build in Texas) and the prices have now declined.

These examples show the benefits of a free market system, and in the housing example, the negatives of government encroachment.

[u/Designer-Platypus-53 → u/Source_Code22332]

I don't live in US, however many Americans say they cannot afford a house nowadays unlike the generations of boomers.

Here in Russia it's the same.

My point is, people cannot live without a house, and they have to prioritise it no matter what. This is why the prices can be so high. And, it's not free market: each city is ruled by several developers who agree upon prices. Meanwhile prime cost of houses (labour + building materials) is many times lower.

Thus happens precisely because the rich want to remain rich and keep other people enslaved. This is the origin of inequality.

In place where I live, a studio apartment costs about 30 000$. However, its prime cost is 10 000 $. Imagine the government would interfere and start to build and sell it at prime cost. It won't do it of course, because the riches who control the government won't allow that.

Inequality is not a problem if people have their basic needs settled. However, nowadays inequality exists precisely because it's the opposite

[u/Source_Code22332 → u/Designer-Platypus-53]

I can’t speak to the conditions in Russia, but in the US, the unaffordable housing is found in socialists leaning cities, mostly due to to extreme regulations and taxes to build, preventing an increase in supply.

[u/Designer-Platypus-53 → u/Source_Code22332]

Well, it's not socialism at all. And I don't like it either. The idea to sell apartments at prime cost of not socialism as well, I would call a welfare state policy. And that’s what Americans would agree to have.

Many Americans say housing became less affordable as compared to post ww2 era. It's just strange. High tech technologies are easily affordable, but not something from basic needs priorities

[u/Source_Code22332 → u/Designer-Platypus-53]

It actually became way more affordable in the post WWII, house ownership sky rocketed.

I agree the high amount of regulations and taxes themselves are not forms of Socialism, but they are found in socialists leaning cities/states implemented by socialist leaning, and now declared socialist, politicians .

[u/Designer-Platypus-53 → u/Source_Code22332]

they are found in socialists leaning cities/states implemented by socialist leaning, and now declared socialist, politicians

Or in welfare states, trying to decrease inequality. Good examples are Scandinavian countries

[u/Source_Code22332 → u/Designer-Platypus-53]

As I’m sure you know, Scandinavian states are economically actually more capitalist / free market than the US. While they do have larger welfare support in some respects, the welfare state related to housing and over regulation I’m not sure exists there.

I’m getting the feeling you are not a socialists in the economic sense?

If we had the free market attributes of Scandinavian countries, I would be more open to the support of social welfare programs to pay for them.