"Thomas Jefferson put a lot of effort into laying a strong legal basis for widespread ownership of family farms in the U.S. It helped make the U.S. different from Latin America where the land tends to wind up in the hands of a handful of families."
This is/was one of the most critical foundations of early modern prosperity imo like the 100 year leases on family farms in England.
"Ukraine is currently a really, really poor country, with a GDP per capita about a third of Poland's...But Ukraine has a lot of billionaires"
This goes together.
Option1: 10% rich with 90% of wealth, 90% poor
Option2: 10% rich with 20% of wealth, 90% middle class
In option 1 the velocity of money is very low because the 90% have no disposable income and the rich, although they have vast amounts of disposable income only need to spend small amounts at a time so most sits stagnant in the form of stored wealth.
In option 2 the velocity of money is very fast because the 90% middle class have a lot of disposable income between them and they spend most of it every month. The rich spend about the same as they did in option 1.
The huge increase in the velocity of money in option 2 generates a much higher GDP so even though the rich have only 20% of the total wealth, in absolute terms they are richer than they were in option 1.
The trouble in paradise is that in option 1 the rich having 90% of the wealth - even if in absolute terms it is less than in option 2 - means the rich have 90% of the power whereas in option 2 they only have 20% of the power.
What exists in Ukraine today is where the West is heading because of the oligarchs and their control of the media-politics-finance complex.
Wednesday, February 26, 2014
Posted by AmericanGoy at 4:18 PM