Wealth in America

[Graham Kennedy]

http://www.upworthy.com/9-out-of-10-ame ... ing-fact-2

This pretty much speaks for itself. At 1:05, I get a rude awakening. At 1:41, he starts talking about you. At 2:24, he says a "bad" word. At 3:50, he kind of breaks my brain. At 4:50, he lets you know how broke you really are. At 5:20, he rubs it in. And at 5:50, he points out that reality isn't close to what we think it is.

[McAvoy]

I have known this for awhile actually.

The 380x figure is shown in Facebook memes all the time.

[sunnyside]

Hold on. He indicated what he's talking about is "wealth" i.e. net worth.

If everyone was making the same amount and saving at the same rate you'd expect a straight line going from zero to some max value on the right just because of the number of years one has been in the workforce.

But savings typically starts off pretty flat as you deal with kids and stuff and then accumulates until retirement and then reduces. So again even if everyone makes the same income and saves at the same rate at the different stages in their lives you'd except a curve more extreme than a straight line.

But of course people are going to save at different rates. And some may spend on stuff that "counts" for net worth vs stuff that doesn't (collectible comics or baseball cards vs downloading video games and movies).

So even in a scenario where everybody had exactly the same income, a wealth distribution chart would probably look rather like the "ideal" one presented there.

I suspect either the presenter is misunderstanding the study, or study participants misunderstood (or just didn't think it through and consider the math).

Which doesn't mean that there might not be various social issues to discuss, just that this is a horrible presentation.

[Captain Picard's Hair]

I suspect either the presenter is misunderstanding the study, or study participants misunderstood (or just didn't think it through and consider the math).

The study itself seemed to be 1. fairly straightforward and 2. presented pretty directly. As to how the participants considered their responses, it's rather unlikely many did any math at all. This has as much to do with psychology as economics: people just aren't calculating machines. I'd assume most of the participants made a quick judgment based on their shared intuitive sense of fairness.

The fact that most Americans don't grasp how skewed the actual distribution of either incomes or net worth in America is has also been demonstrated in many other studies. Moreover, the relationship isn't a one-way street. Those who start with more also have more opportunities to earn more. The same applies to the children of poor and wealthy parents. What we see isn't a meritocratic distribution of income and is becoming less so.

[sunnyside]

people just aren't calculating machines. I'd assume most of the participants made a quick judgment based on their shared intuitive sense of fairness.

I suppose in the context of a quarter of them thinking the sun goes around the earth that result could make sense. Asking about income might reduce the idiot factor somewhat compared the wealth.

Those who start with more also have more opportunities to earn more. The same applies to the children of poor and wealthy parents.

That's a bit of a seperate issue that I think needs to be addressed and one I think people might be able to get behind. Though I suppose it's an issue where the cost to one's own children is laid relatively bare, which might be why it gets relatively little play. And the local level management is probably vastly simpler logistically and allows for variation.

The fact that most Americans don't grasp how skewed the actual distribution of either incomes or net worth in America is has also been demonstrated in many other studies.

Though I bet most of those polls are for income prior to wealth redistribution. While you'll still have some crazy CEO and celebrity salaries, there is a lot of support at the lower end. Actually for a number of scenarios you actually find that people come out behind if they raise their income, usually in a sawtooth sort of pattern (i.e. for a while their actual income/benifits goes up with income, but then they cross some threshold that drops them out of a program and they're net worse off. I remember one study where for a single parent with a child maximum net benifit was at something like $20,000 income, and then was lower until you got to something like $80,000.

Though even after that I don't know how people would take the distribution.

Though it is relative. Maybe throw your income into www.globalrichlist.com and see how you stack up to the world. I bet most of us ARE the 1%.

[McAvoy]

Number one argument between conservatives and liberals is the distribution of wealth. Liberals want it more fair to put it simply and conservatives want that one in a million chance to make the big bucks and be easier to do it.

Me personally it is starting if not already to feel like how the US was a hundred years ago.

[sunnyside]

Liberals want it more fair to put it simply and conservatives want that one in a million chance to make the big bucks and be easier to do it.

No that's a misrepresentation, at least for the conservatives. Or rather that might represent the small number of people who are playing for the big money. But you aren't going to win an election on 1% of the electorate.

Rather conservatives actually believe in capitalism. There is reason for that. Coutries attempting to enact communism have tanked their economies, and China has been increasingly going capitalist because every time they make such a change or pick a region and allow it to act in a capitalistic manner they see a substantial jump in productivity.

Also since a lot of people have stocks (i.e. retirement accounts) they have some skin in the overall game.

Put it this way. A quick check has Mother Jones claiming that the mean nasty top .01% average an income of ~$23,800,000. If you took a third of that money from them (in addition to whatever taxes they're already paying) and divide that among all the other households, average earners per household (1.3), and a 2000 hour a year job than you get a pay increase of ~30 cents an hour for everbody. Not nothing I suppose, but not exactly a massive change. You don't have to hurt the system much before that comes out at a net negative.

The other side of that is that conservatives don't tend to think much of certain types of handouts. You do have some common ground. But, being common ground, we already have those programs. So generaly new programs would be seen as going "too far" to support what is seen as a luxurious life on welfare or in a part time job (not so much luxurious in terms of wealth but in terms of getting to be on "vacation" so much more).

Of course there a lots of different sorts of conservatives, but I think that's more of the issue.

I should also point out that most conservatives don't think Liberals want things to be more "fair" they think liberals just want more money for themselves, be they poor, government workers, or government funded academics, and they just don't care what the effects on the country would be.

------

On a seperate note you got me poking around on income inequality. A couple things:

#1 The congression budget office did put out a report on increasing income inequality. But I note they don't compensate for inflation. Going online to an inflation calculator it looks like the rich aren't actually any richer, they've just managed to almost keep up with inflation. That would mean the other quintiles have less inflation adjusted income.

#2 Everything is done by households. I'm having a difficult time finding information on pay rates for specific jobs. Households are going to be missleading vs the 70s. Every couple that divorces or doesn't get married produces two households with half the income vs the 70s. Similarly if you have a dual income household that potentially doubles their income vs more traditional times. Both of those are going to artificially increase inequality.

Or maybe artificial isn't the right word, but that would make it a social family structure issue not a wage issue.

If you can find info on equivalent jobs I'd be interested.

[Graham Kennedy]

No that's a misrepresentation, at least for the conservatives. Or rather that might represent the small number of people who are playing for the big money. But you aren't going to win an election on 1% of the electorate.

But that's not what he said. He said that conservatives play to those who want the chance for the big bucks.

Seems to me that that's a big thing in America; no matter how poor a person might be, they don't consider themselves to be actually "a poor person" - in their mind, their poverty is just a temporary thing. All it takes is lots of hard work, or one lucky turn, one lottery win or one viral youtube video or whatever, and they will be millionaires.

Put crudely, Americans are willing to have a society in which rich people shit on poor people because the believe on some level that one day they'll be up there shitting on everyone else.

Rather conservatives actually believe in capitalism. There is reason for that. Coutries attempting to enact communism have tanked their economies, and China has been increasingly going capitalist because every time they make such a change or pick a region and allow it to act in a capitalistic manner they see a substantial jump in productivity.

That's such BS. The choices are NOT "you can be capitalist or you can be communist"; there's about a million shades between those two things, a million levels of government interference and regulation. The last 25 years or so have seen the US slide very much towards the capitalist end of that, and it is doing real harm to the country and to tens of millions of people in it.

But it's all being sold to them on the direct lie that this will help everyone, that the problem is government and if they can just get government out of the way then it will all be gravy. Meanwhile that agenda does nothing but concentrate the wealth of the nation in the hands of the tiny minority whilst everyone else has been relentlessly squeezed.

I should also point out that most conservatives don't think Liberals want things to be more "fair" they think liberals just want more money for themselves, be they poor, government workers, or government funded academics, and they just don't care what the effects on the country would be.

Indeed. And there are probably a few on the left who would support that, the Chomskys of this world and whatnot. But it's not even close to resembling mainstream thought on the left. Whereas "dismantle all government" gets FAR more traction on the right.

[McAvoy]

Let's keep in mind I did generalize. But I do that out of sarcasm because that is what it seems like now a days either you are a Racist Bigot Conservative or a Libtard Moocher. With nothing in between. Of course it's the always the idiots who scream the loudest while the majority which I belong in is in the grey area in between who say nothing.

Conservatives above all else want those who earned that fifty billion dollars to keep it and maintain whatever business practice that made them that money to remain intact. Anything against that you are a socialist.

[sunnyside]

Let's keep in mind I did generalize. But I do that out of sarcasm because that is what it seems like now a days either you are a Racist Bigot Conservative or a Libtard Moocher. With nothing in between. Of course it's the always the idiots who scream the loudest while the majority which I belong in is in the grey area in between who say nothing.

In addition I find that there is a strong desire on both sides to demonize and misrepresent the other. Though I suppose that's probably been popular and effective for thousands of years, I feel like the groups aren't mixing as much and so it's sticking.

On that note I'm a moderate split ticket sort of voter here in the US. So I have liberal and conservative friends. This means I can't post anything political on Facebook because both groups can comment and the fit hits the shan.


on that note:

Put crudely, Americans are willing to have a society in which rich people shit on poor people because the believe on some level that one day they'll be up there shitting on everyone else.

Um... I think you've been watching too many episodes with Ferengi.

Whereas "dismantle all government" gets FAR more traction on the right.

No. That would be anarchists. In the US the anarchists are mostly Libertarians of the anarcho-capitalist variety. They tend to vote republican because while both parties want to legislate how you live, the Democrats also want to legislate away how your run your business and more of your money.

Conservatives just want a smaller government, or possibly even the same size, just move the people and funding over to the departments of energy and defense and the like.

The choices are NOT "you can be capitalist or you can be communist"; there's about a million shades between those two things, a million levels of government interference and regulation.

Agreed. I'm just saying there are clear examples of capitalism being decisively better than socialism/communism to get you to "get" what "they" are thinking and see that it isn't so unreasonable a heuristic as they go.

Seems to me that that's a big thing in America; no matter how poor a person might be, they don't consider themselves to be actually "a poor person" - in their mind, their poverty is just a temporary thing. All it takes is lots of hard work, or one lucky turn, one lottery win or one viral youtube video or whatever, and they will be millionaires.

I disagree. Though I decided to poke around a bit to find a poll. I'm not sure how great a poll it is or how well the site is characterising it, but this is what I found on that and it strikes me as rather interesting.
http://www.bankrate.com/finance/financi ... day-1.aspx

For one thing one-third say it's very or somewhat likely they'll get rich.

But also that two percent think they already ARE rich. Which seems to me to indicate an issue with the definition of rich.

But they asked about that, and that's the really interesting part.

It found

"17 percent say that being rich means having a net worth of $1 million or more, and 11 percent say that a six-figure annual income makes someone rich."

That might have made you rich back in the 1920s or something. These days it's maybe upper class if you're young but I'd say still middle class, though maybe upper middle, if it takes you your whole carer to get that million net worth. So that alone surprised me.

But then the more shocking bit to me:

"7 percent of respondents define "rich" by possessions such as houses, cars and boats.
...rich means having just enough money not to worry, to at least one-third of Americans (33 percent)"

I've seem some attempts to define "middle class" and often that's about it. Having just enough money not to worry coupled with things like home ownership and having a car.

If 40% of Americans really are defining rich that way than it makes sense a third of Americans think they'll become rich.

But that makes me wonder if maybe that's causing some communication issues. Democrats are always talking about how they're going to go after "the rich".

If a lot of people think that means the Democrats are saying they're going to rip the finances of anybody that owns their own car and home than the Democrats sound rather nasty and a lot of people might be spooked that their wallet is directly on the chopping block.

[Graham Kennedy]

Um... I think you've been watching too many episodes with Ferengi.

And I think I haven't.

No. That would be anarchists. In the US the anarchists are mostly Libertarians of the anarcho-capitalist variety. They tend to vote republican because while both parties want to legislate how you live, the Democrats also want to legislate away how your run your business and more of your money.

Call them what you wish, but the fact is that there is a large contingent of the US right wing who openly advocate the end of federal government. Look at the recent shutdown - some of them were positively gleeful over it until it began to sink in that it was hurting them politically. Some of them still think their only error was in finally giving in.

Conservatives just want a smaller government, or possibly even the same size, just move the people and funding over to the departments of energy and defense and the like.

Many conservatives just want smaller government, perhaps. Just as many liberals just want a somewhat fairer society where the poorest and most vulnerable don't suffer quite so much.

The point I was making is that both parties have more extreme elements, and the difference is that on the left the extreme elements are pretty much ignored by those with the power, whilst on the right the extreme elements drive a great deal of the mainstream agenda.

Agreed. I'm just saying there are clear examples of capitalism being decisively better than socialism/communism to get you to "get" what "they" are thinking and see that it isn't so unreasonable a heuristic as they go.

And there's really no disagreement on that. But there's a tendency in US politics in the last decade or so to declare that anything even slightly left of the teabaggers is socialism. The fact that people actually accuse Obama of being a Marxist because he wants to put a few cents on the top rate of tax is laughably absurd.

I disagree. Though I decided to poke around a bit to find a poll. I'm not sure how great a poll it is or how well the site is characterising it, but this is what I found on that and it strikes me as rather interesting.
http://www.bankrate.com/finance/financi ... day-1.aspx

For one thing one-third say it's very or somewhat likely they'll get rich.

Which demonstrates that a full third of the population is delusional.

But also that two percent think they already ARE rich. Which seems to me to indicate an issue with the definition of rich.

Very possibly. One could argue that most anybody living in the western world is rich on a global scale.

"17 percent say that being rich means having a net worth of $1 million or more, and 11 percent say that a six-figure annual income makes someone rich."

That might have made you rich back in the 1920s or something. These days it's maybe upper class if you're young but I'd say still middle class, though maybe upper middle, if it takes you your whole carer to get that million net worth. So that alone surprised me.

The word "millionaire" still has a lot of cachet, for purely cultural/historical reasons. As you say, in the 1920s a millionaire would be truly rich. Even thirty years ago you'd be pretty well off. These days, not so much.

But that makes me wonder if maybe that's causing some communication issues. Democrats are always talking about how they're going to go after "the rich".

If a lot of people think that means the Democrats are saying they're going to rip the finances of anybody that owns their own car and home than the Democrats sound rather nasty and a lot of people might be spooked that their wallet is directly on the chopping block.

Could be.

[McAvoy]

I think it is safe to say that majority of the people here if not all are liberals. Damn filthy Libtards as Facebook or YouTube commentors would say. I know the Liberal left in the US is really more moderate than the rest of the world and Conservatives are more unique to the US than anywhere else.

IMO America is starting to look like what it was a hundred years ago in terms of the wealth distribution. It took an incredibly strong and powerful President who was practically independent of it all to fix it or at least tried to fix it. This is just my observation though.

[sunnyside]

Call them what you wish, but the fact is that there is a large contingent of the US right wing who openly advocate the end of federal government. Look at the recent shutdown - some of them were positively gleeful over it until it began to sink in that it was hurting them politically. Some of them still think their only error was in finally giving in.

It's more about what they would call themselves. Libertarians do not appreciate being called "right wing" even if they tend to end up supporting right wing candidates and supporting right wing organizations. It's only because our particular system is organized in such a way that it's hard to have a viable third party, so you either throw your votes and donations away or affiliate with one of the two.

Actually on that note are we talking about the same thing here? When you say conservative are you meaning US conservatives or more UK conservatives? Do you know any US conservatives or does your knowledge on the subject come from watching Piers Morgan or somesuch? I wouldn't presume to tell you all about what the Tories or Labour or whatever you have over there think.

And there's really no disagreement on that. But there's a tendency in US politics in the last decade or so to declare that anything even slightly left of the teabaggers is socialism. The fact that people actually accuse Obama of being a Marxist because he wants to put a few cents on the top rate of tax is laughably absurd.

Hyperbole, demonizing, and "poisoning the well" all work and are all popular. I mean you seem to have gotten a rather caricature like impression of conservatives and I'm not at all sure I'll be able to shake you from the comfortable feeling I'm sure that provides.

Our media is a constant bombardment of arguments along the line of "They say they want <small measure> therefore they are a <perjurative term> and what they really want is <extreme measure>"

I think it is safe to say that majority of the people here if not all are liberals. Damn filthy Libtards as Facebook or YouTube commentors would say.

Yeah, I think as a swing voter I'm the closest you get to a US conservative. Unless you know of somebody else.

I know the Liberal left in the US is really more moderate than the rest of the world and Conservatives are more unique to the US than anywhere else.

Whoa whoa whoa. If you replace "rest of the world" with something more along the lines of the "western" world than maybe. In terms of the whole world by population the US would fall well on the liberal side of the balance. The western euro countries make up the extreme left.

IMO America is starting to look like what it was a hundred years ago in terms of the wealth distribution. It took an incredibly strong and powerful President who was practically independent of it all to fix it or at least tried to fix it. This is just my observation though.[/quote]

[McAvoy]

Yes I meant Western World and I did mean with those countries having similar party systems as the US.

I wonder if Deepcrush was a conservative...

[Tsukiyumi]

I wonder if Deepcrush was a conservative...

On some things, yes. On others, quite the opposite. Sort of like me, actually.