An important element of the conversation is does (or how much does) it matter if any specific percentile group is getting disproportionally richer, given all (or a vast majority of) groups are? A group's lack of upward movement is not unjust if their groups actions do not justify a movement upward.
Additionally we also have to recall that the quintile's populations are not necessarily static. to illustrate the idea: members of a quintile may join an adjacent quintile in the next time period. That is, bottom members may move up, top members may move down, mid members may move either way. To the extent their movements are justified by their actions/choices is to the extent we have a fair society.
That is, if people are getting rich from sources not related to taking right actions, or people are taking good actions and getting poorer -- then we have an unjust society.
This can both apply to Rich people abusing their power to get rich, but also with poor people abusing their democratic powers to unjustly take from others that which they have not earned.
The issue is that income/wealth compounds over time. If people in the bottom 40% have very little to invest, they have nothing that compounds. They dont even have an opportunity to risk anything, or make a better decision.
The prices of the essentials are largely out of any individual's control. So any lack of ability to save / invest beyond spending on those is also out of their control. It's a vicious cycle, where excess wealth compounds, and income needed to exist dries up.
Also the rich often see a larger return to their investments than poor people, so having wealth seems to aide in your ability to make more money. Exactly the sort of thing that you implied was unjust.
And your other points about mobility I agree with and are addressed in notes on the site.
What is the issue with wealth compounding? The bottom 40% have a very high value asset -- their agency and actions in the real world. (Working, starting a business (however small), self sufficiency et al.).
The prices of true essentials are exceedingly small. Essential is something like sharing a room with someone, eating rice beans frozen veg mix (ie very inexpensively), wearing clothes from thrift stores, exercising outside and using a library card, medicaid. Everything beyond that is, technically, optional.
Having wealth aiding the overall return doesn't negate my point. Using wealth to get an unjust return does. An example of a better return would be hiring a financial advisor that (somehow) creates better returns using smarter allocations. An example of an unjust return would be creating a monopoly, buying a politician, or extracting profits from unpriced externalities (pollution and bailouts to name a couple). (These do happen in the USA, and I'm all for ending them!)
There's nothing unjust about someone getting more returns on more invested, this will naturally lead to a widening wealth gap over time. It's an inherent property of existence that more invested yields more return yields yet more invested (accelerating).
I do, however, like Scott Galloway's point that we need to find new ways to get the rich to spend their money, we need the poor to start 10000 businesses that gratify the rich and extract their money. Right now they're mostly accumulating it and bidding up investible assets (eg look athe P/E multiple of the S&P 500) .
Most new businesses fail. Then the poor are even deeper in the debt hole.
Some people can/should start businesses, but a lot of people are just not entrepreneurs - I include myself in that group. I realize that there must be ways to extract money from this economy - lots of people are doing it - but I don't think any of my ideas would end up doing that (they're generally too niche), more likely I'd end up losing a bunch of money trying to do that.
You can configure what you believe to be the correct price of essentials on the site. The defaults are BLS group average spending data.
"There's nothing unjust about someone getting more returns on more invested, this will naturally lead to a widening wealth gap over time. It's an inherent property of existence that more invested yields more return yields yet more invested (accelerating)."
Do you see how there is nothing stopping insane accumulation of wealth/power? (assuming returns continue to accelerate in this manner?)
There's nothing wrong with the accumulation of wealth. I fully agree that Citizens united (not capitalism) has created a distortion and corrupting force in the market place.
It's not the wealth that is evil/wrong/unjust/immoral. It's the use of it to corrupt power.
Housing and healthcare are both mentioned and covered.
> sharing a room with someone
> medicaid
in the top 10 CoL metros one can share a room with another person for about $600 a month.
I note that on your links the poverty wage is pretty close to the minimum wage. I'd contend that since contraceptives are widely available, including abortion in many places (or charities helping people get them in other states), we should expect the bottom quintile to not be adding to their expenses.
> "does (or how much does) it matter if any specific percentile group is getting disproportionally richer, given all (or a vast majority of) groups are?"
The page says that at least 50% of all people are not, so this seems like a very moot question until such a time as that changes.
And if it ever does change, we can then move on to the issue that "fairness" only exists to the extent that one is willing to acknowledge that having money fundamentally and inherently leads to having more money due to the nature of compounding growth, and the more money you have the more money you get by no real action at all.
You talk about "earned", but how exactly have I "earned" the compounding growth on my holdings? I certainly don't work for it. It just flows in for free as the world population continues to grow and produce. I can do literally nothing at all but drink margaritas on the beach and my assets will grow more per year than an average person ever makes by labor. Would you say that I "earn" it? I call it "getting" not "earning". There's nothing fair about it.
I like your post a lot, in that you're describing how this doesn't say anything about anyone's chances really. However...
> but also with poor people abusing their democratic powers to unjustly take from others that which they have not earned
How would they abuse their democratic powers? It's their decision to vote either way. So who says that's unjust? Certainly it's not abusing their democratic powers.
Abusing of power happens on the other end of the spectrum, especially in the US thanks to citizens united.... Surely all those super PAC dollars don't buy any influence... As a result, the voice of a single rich person might be stronger than a whole quintile of the population. So chances are that they are unjustly given things that aren't theirs (i.e. advantageous contracts, laws that help them etcetera).
I hold, i guess as a basic principle, that tyranny of the majority is an unjust failure case of democratic systems.
Fully agree Citizen's united has resulted in legalized corruption. But 2 wrongs do not make a right, ethically.
There's nothing unjust about a rich person getting superior results through access to better resources though. Eg hiring a better tax accountant or financial advisor.
Wealth inequality is mainly a statistical phenomena.
If you start a perfectly fair society where everyone has exactly the same amount of money and you play a game were people interact and with equal random chance (i.e. each exchange you get a 50/50 chance of earning 1 buck or losing one), after a few exchanges you get a Boltzmann-Gibbs (exponential) distribution.
If each agent wealth chance of increasing depends on what they already have, you get a pareto distribution.
>A group's lack of movement is not unjust if their groups actions do justify a movement upward.
I assume you mean "do not justify" and the bottom line is that this type of thinking is fundamentally erroneous.
We agree to live in a society of this construction not so everyone can pull themselves up by their bootstraps (asinine conception that misunderstands structural vs individual agency) but because it is of collective benefit.
If it it not of collective benefit, the social agreement needs to be renegotiated.
There's no chance everyone will agree to live in an arrangement where a minority of the population accrues all of the benefit because they go out of their way to execute financial scams, but I'm willing to litigate that publicly, which we're doing here.
My whole point is that to the extent accumulated wealth is happening by playing by the rules, there is no injustice in accumulating wealth, nor in accumulating more than those who did not do the actions which relate to wealth building. (And there's a randomness factor involved so it mostly has to be taken on average, on average starting a business is profitable, but also lots of them fail)
If the rules technically allow a loophole that allows a minority group to accrue wealth over the majority, why would the majority agree or consent to be in that system? A minority oppressing a majority is classically a definition of tyranny.
Society isn't some abstract collection of rules that must be followed. Those rules are actively negotiated for majority benefit, and we agree that each person has an equal voice in the west.
If that collection of rules is failing, it's considered unjust and something to amend.
"That's just smart" because someone found a loophole or did a scam to accrue wealth isn't an acceptable negotiated state of affairs to most people.
> Those rules are actively negotiated for majority benefit
This is a presumed goal/value. A more conservative take is that the rules are actively enforced based on values or justice.
A value could be that we do not support ill gotten gains, to the extent that the majority votes for free things paid for by the minority it could "benefit the majority" and still violate the value
I can't think of any known moral system where "willingness and persistence to execute various clever scams and accrue resources" is identified as a value worth prioritizing or protecting.
I've actually gone through the rolodex of all known moral systems and none of them endorse the conception that a minority, who just earned it rightfully, is allowed to accrue outsize resources while other groups do not.
So, again; as I said earlier, I open the floor for discussion. This is the moral certainty that the process by which we adjudicate the social order will not be favorable to an unjust conception. The simple light of day ends most of these discussions.
Past a point of wealth, it seems a lot easier to increase wealth through things of no intrinsic value to society.
If I have enough money, I can buy a lot of businesses (or be in a controlling position) and run them poorly (read: efficently) and as wealth concentrates the capital for a new entrant to compete becomes scarcer and regulation on new competition mysteriously materializes, and without any new competition I can raise prices and no one can really do anything.
And now I have more money to do this more times in more places, and wealth is more concentrated, and legislation just seems to go my way more and so on.
That vague playbook is being applied to just about everything today.
Spirit Airlines went through two bankruptcies, and the people who lead the first one were liquidating it while it was still running to pay themselves back for the first one, and turning debt they had forfeited for equity back into debt to increase how much they'd take out of the remains.
I mean you can't even escape that playbook in childrens sports! That playbook is being run into making children sports league a profit squeezing cartel as we speak.
It's just such a simple playbook that if we really go all in on the idea that anything that's technically legal to make money will be allowed, then having more money and basic "high agency" mindset will lead to making money in increasingly perverse ways.
To me the end game seems to be a race between authoritarianism (will these high-agency wealthy types just be able to keep the poorer class under lock and key with TikTok feeds to placate) and collapse (maybe they don't get the poor under deep enough control before the poor realize they've been given a deal that justifies trying to raze it all and start again)(edit: or maybe better framing, they realize they collectively have no meaningful part in the wealth and raze it)
To me everything you've identified is either 1) Corruption or 2) Consumers being sheep.
If the kids sports is a profit seeking cartel that you do not agree with, then do not give them your money. If enough customers do that they will not be profitable and will cease to exist once they can no longer extract investor capital from the very class this post seems to dislike.
Really roughly speaking the American consumer needs to stop being so complacent and naive, the American voter needs to get a good bit more politically active, and people need to stop choosing comfort over action. the average 2.5 hrs a day on social media could easily be spent to make their lives much better.
The market is not able to fix corruption. Regulation is needed. For example, exploitative labor practices weren't ended in the early 20th century because of customer preference. Laws had to be passed.
The global billionaire class now numbers roughly 3,500 people and collectively controls around $15–20 trillion in wealth. That's about the annual GDP of China.
That's about twice as much as the lower 50% of the population (2% of the world's wealth)... a class consisting of 4 billion people.
Why do people pretend "right actions" has anything to do with it. "Right actions" aren't even possible at that scale of difference. How does "earning" even make sense at these proportions? you think 3500 people are doing that much more than 4 billion others?
The P/E Ratio of the S&P 500 is at a historic high level. Interpreted another way, there rarely is a better time to create a profitable business -- You can get paid $30ish dollars per annual dollar of profit you create.
On the flip side, it's never been so expensive to be an investor of capital. In order to get a return you have to wait 30 years (or 10 if you take growth rates into account), just to see your initial investment. An expensive stock market makes current consumption more rational for investors.
that capital might also be doing a lot more if not bottlenecked by the 0.000001% of the population controlling it
but let's not pretend that "right" has anything to do with it... that's like the scale of a single bacterium doing the right thing to turn itself into a school bus
Very hard to parse, not very helpful, and blatantly wrong. Cutting through the slop, the "bottom 50% of households" average income is said to be $22,907 without any expenses? The middle 20% making $60,298? That's...very obviously incorrect.
The average for the bottom 50% of households is $30,000-something. Would take too much effort to figure out the exact figure for a comment, but still way higher what this site says, and I still feel like this is more effort than went into this misinformation site.
Its own linked source says that for 2022 the bottom quintile makes $26.2k before taxes and transfers and $44.8k after, while this site says $17.2k after. No wonder it's coming up with such wacky conclusions like saying a majority of America is going into debt while only buying the bare essentials and nothing else. If you use the correct income numbers, even the bottom quintile averages out to having $16k extra after essentials.
Yes, I was initially confused by the title and the content talking about two different things. I've edited my post with the correct numbers now. Even the household numbers are wrong, and the taxes and benefits numbers are very wrong.
What does not help, in my opinion, is that the wealthy people often have enough resources to optimize their taxes to a point where they pay much lower rate than their fair share. While the others cannot afford to do that and pay the full rate. That in itself creates inequality.
If a base rate that the society agrees on is e.g. n %, then, in my opinion, everyone should pay that n %. But in reality the poor people pay n % because they have no time to even think about optimizing it. As they often work around the clock to make ends meet. While the richer people hire professionals to take care of their taxes and optimize them to the extent that they pay significantly less than n %. And then there are super rich, some of whom, such as Donald Trump, pay almost no taxes at all.
This is, in my opinion, wrong and significantly contributes to wealth inequality. And therefore I believe that it needs fixing.
A visit to Disney World introduces some questions that bring doubts to this article. The park is overrun with young families, with a great many speaking English as a second language. They don’t seem to be top percenters, but they’ve got cash for tickets and food. ( The food seems to be priced about 5x what I’d imagine it to be at a real store. )
If they truly are poor, they’re surely living YOLO.
The Disney World visitors are a specific group of people. The vast majority of them do not go there every week, nor every month. So the behavior you observe in there is not representative of the routine behavior of those people.
In other words, yes, they may pay 5x the price for a meal in an amusement park that they visit once a year. That does not mean they are willing to pay anything close to that for a meal every week or every day.
It's my observation over time that there has been a sharp increase in the what people would call the "bare minimum" life. I think it's a combination of credit, a loss of stoicism, and social media pushing a distortion of reality.
I mean, Piketty showed this a decade ago in capital in the 21th century: the higher your income percentile and wealth percentile, the higher saving rate and the higher returns on your investment (which is negative for folks at the bottom of the distribution).
Of course the other problem with the projection is that BLS average expenses aren’t super accurate to project what people are spending on at those income percentiles :)
I don’t think that many people have read Piketty given how dense his work is. I’m glad I share my native language with him which makes it a bit easier to understand some of his points, but his writing is really difficult to grasp IMHO
This is hiding the real truth. Rich people invest more money and its a good thing that they invest because the investment goes into productive areas which ends up back into consumption.
The other way round is much much worse - imagine if rich people don't invest but rather just consume. It _takes_ away money from poor instead of building more wealth for everyone.
So the overall point being made here is not that true
This is just trickle down economics, which has led to great wealth inequality while the middle and lower class wages have stagnated as inflation has gone up. What really helps is strong social safety nets and programs that help struggling people. The Nordic model leads to better societal outcomes.
This is just trickle down economics, which has led to great wealth inequality while the middle and lower class wages have stagnated as inflation has gone up and more people have to rent instead of owning their own porpoerty. What really helps is strong social safety nets and programs that help struggling people. The Nordic model leads to better societal outcomes.
i’m pretty skeptical of this analysis because it (by default) hides the effect of welfare and advocates for a wealth tax. Hiding the existing social safety net in order to advocate for taxes feels very propagandistic.
More than propagandistic, it calls into question whether they are actually trying to solve a problem at all. The US has considerable support for low income families. That's a good thing, if you don't want to even see whether it works, what's your goal?
An important element of the conversation is does (or how much does) it matter if any specific percentile group is getting disproportionally richer, given all (or a vast majority of) groups are? A group's lack of upward movement is not unjust if their groups actions do not justify a movement upward.
Additionally we also have to recall that the quintile's populations are not necessarily static. to illustrate the idea: members of a quintile may join an adjacent quintile in the next time period. That is, bottom members may move up, top members may move down, mid members may move either way. To the extent their movements are justified by their actions/choices is to the extent we have a fair society.
That is, if people are getting rich from sources not related to taking right actions, or people are taking good actions and getting poorer -- then we have an unjust society.
This can both apply to Rich people abusing their power to get rich, but also with poor people abusing their democratic powers to unjustly take from others that which they have not earned.
See figure 2.
The issue is that income/wealth compounds over time. If people in the bottom 40% have very little to invest, they have nothing that compounds. They dont even have an opportunity to risk anything, or make a better decision.
The prices of the essentials are largely out of any individual's control. So any lack of ability to save / invest beyond spending on those is also out of their control. It's a vicious cycle, where excess wealth compounds, and income needed to exist dries up.
Also the rich often see a larger return to their investments than poor people, so having wealth seems to aide in your ability to make more money. Exactly the sort of thing that you implied was unjust.
And your other points about mobility I agree with and are addressed in notes on the site.
What is the issue with wealth compounding? The bottom 40% have a very high value asset -- their agency and actions in the real world. (Working, starting a business (however small), self sufficiency et al.).
The prices of true essentials are exceedingly small. Essential is something like sharing a room with someone, eating rice beans frozen veg mix (ie very inexpensively), wearing clothes from thrift stores, exercising outside and using a library card, medicaid. Everything beyond that is, technically, optional.
Having wealth aiding the overall return doesn't negate my point. Using wealth to get an unjust return does. An example of a better return would be hiring a financial advisor that (somehow) creates better returns using smarter allocations. An example of an unjust return would be creating a monopoly, buying a politician, or extracting profits from unpriced externalities (pollution and bailouts to name a couple). (These do happen in the USA, and I'm all for ending them!)
There's nothing unjust about someone getting more returns on more invested, this will naturally lead to a widening wealth gap over time. It's an inherent property of existence that more invested yields more return yields yet more invested (accelerating).
I do, however, like Scott Galloway's point that we need to find new ways to get the rich to spend their money, we need the poor to start 10000 businesses that gratify the rich and extract their money. Right now they're mostly accumulating it and bidding up investible assets (eg look athe P/E multiple of the S&P 500) .
> we need the poor to start 10000 businesses
Most new businesses fail. Then the poor are even deeper in the debt hole. Some people can/should start businesses, but a lot of people are just not entrepreneurs - I include myself in that group. I realize that there must be ways to extract money from this economy - lots of people are doing it - but I don't think any of my ideas would end up doing that (they're generally too niche), more likely I'd end up losing a bunch of money trying to do that.
You can configure what you believe to be the correct price of essentials on the site. The defaults are BLS group average spending data.
Do you see how there is nothing stopping insane accumulation of wealth/power? (assuming returns continue to accelerate in this manner?)There's nothing wrong with the accumulation of wealth. I fully agree that Citizens united (not capitalism) has created a distortion and corrupting force in the market place.
It's not the wealth that is evil/wrong/unjust/immoral. It's the use of it to corrupt power.
It's laughable to call housing and the big one you skipped healthcare "exceedingly small".
Please spend even 1-2 minutes on the https://livingwage.mit.edu/ for example this calculation for Philadelphia: https://livingwage.mit.edu/metros/37980
Housing and healthcare are both mentioned and covered.
> sharing a room with someone
> medicaid
in the top 10 CoL metros one can share a room with another person for about $600 a month.
I note that on your links the poverty wage is pretty close to the minimum wage. I'd contend that since contraceptives are widely available, including abortion in many places (or charities helping people get them in other states), we should expect the bottom quintile to not be adding to their expenses.
> "does (or how much does) it matter if any specific percentile group is getting disproportionally richer, given all (or a vast majority of) groups are?"
The page says that at least 50% of all people are not, so this seems like a very moot question until such a time as that changes.
And if it ever does change, we can then move on to the issue that "fairness" only exists to the extent that one is willing to acknowledge that having money fundamentally and inherently leads to having more money due to the nature of compounding growth, and the more money you have the more money you get by no real action at all.
You talk about "earned", but how exactly have I "earned" the compounding growth on my holdings? I certainly don't work for it. It just flows in for free as the world population continues to grow and produce. I can do literally nothing at all but drink margaritas on the beach and my assets will grow more per year than an average person ever makes by labor. Would you say that I "earn" it? I call it "getting" not "earning". There's nothing fair about it.
I like your post a lot, in that you're describing how this doesn't say anything about anyone's chances really. However...
> but also with poor people abusing their democratic powers to unjustly take from others that which they have not earned
How would they abuse their democratic powers? It's their decision to vote either way. So who says that's unjust? Certainly it's not abusing their democratic powers.
Abusing of power happens on the other end of the spectrum, especially in the US thanks to citizens united.... Surely all those super PAC dollars don't buy any influence... As a result, the voice of a single rich person might be stronger than a whole quintile of the population. So chances are that they are unjustly given things that aren't theirs (i.e. advantageous contracts, laws that help them etcetera).
I hold, i guess as a basic principle, that tyranny of the majority is an unjust failure case of democratic systems.
Fully agree Citizen's united has resulted in legalized corruption. But 2 wrongs do not make a right, ethically.
There's nothing unjust about a rich person getting superior results through access to better resources though. Eg hiring a better tax accountant or financial advisor.
Wealth inequality is mainly a statistical phenomena.
If you start a perfectly fair society where everyone has exactly the same amount of money and you play a game were people interact and with equal random chance (i.e. each exchange you get a 50/50 chance of earning 1 buck or losing one), after a few exchanges you get a Boltzmann-Gibbs (exponential) distribution.
If each agent wealth chance of increasing depends on what they already have, you get a pareto distribution.
It's extremely hard to avoid at large scale.
>A group's lack of movement is not unjust if their groups actions do justify a movement upward.
I assume you mean "do not justify" and the bottom line is that this type of thinking is fundamentally erroneous.
We agree to live in a society of this construction not so everyone can pull themselves up by their bootstraps (asinine conception that misunderstands structural vs individual agency) but because it is of collective benefit.
If it it not of collective benefit, the social agreement needs to be renegotiated.
There's no chance everyone will agree to live in an arrangement where a minority of the population accrues all of the benefit because they go out of their way to execute financial scams, but I'm willing to litigate that publicly, which we're doing here.
correct on the typo, edited it to fix.
My whole point is that to the extent accumulated wealth is happening by playing by the rules, there is no injustice in accumulating wealth, nor in accumulating more than those who did not do the actions which relate to wealth building. (And there's a randomness factor involved so it mostly has to be taken on average, on average starting a business is profitable, but also lots of them fail)
If the rules technically allow a loophole that allows a minority group to accrue wealth over the majority, why would the majority agree or consent to be in that system? A minority oppressing a majority is classically a definition of tyranny.
Society isn't some abstract collection of rules that must be followed. Those rules are actively negotiated for majority benefit, and we agree that each person has an equal voice in the west.
If that collection of rules is failing, it's considered unjust and something to amend.
"That's just smart" because someone found a loophole or did a scam to accrue wealth isn't an acceptable negotiated state of affairs to most people.
> Those rules are actively negotiated for majority benefit
This is a presumed goal/value. A more conservative take is that the rules are actively enforced based on values or justice.
A value could be that we do not support ill gotten gains, to the extent that the majority votes for free things paid for by the minority it could "benefit the majority" and still violate the value
I can't think of any known moral system where "willingness and persistence to execute various clever scams and accrue resources" is identified as a value worth prioritizing or protecting.
I've actually gone through the rolodex of all known moral systems and none of them endorse the conception that a minority, who just earned it rightfully, is allowed to accrue outsize resources while other groups do not.
So, again; as I said earlier, I open the floor for discussion. This is the moral certainty that the process by which we adjudicate the social order will not be favorable to an unjust conception. The simple light of day ends most of these discussions.
Past a point of wealth, it seems a lot easier to increase wealth through things of no intrinsic value to society.
If I have enough money, I can buy a lot of businesses (or be in a controlling position) and run them poorly (read: efficently) and as wealth concentrates the capital for a new entrant to compete becomes scarcer and regulation on new competition mysteriously materializes, and without any new competition I can raise prices and no one can really do anything.
And now I have more money to do this more times in more places, and wealth is more concentrated, and legislation just seems to go my way more and so on.
That vague playbook is being applied to just about everything today.
Spirit Airlines went through two bankruptcies, and the people who lead the first one were liquidating it while it was still running to pay themselves back for the first one, and turning debt they had forfeited for equity back into debt to increase how much they'd take out of the remains.
I mean you can't even escape that playbook in childrens sports! That playbook is being run into making children sports league a profit squeezing cartel as we speak.
It's just such a simple playbook that if we really go all in on the idea that anything that's technically legal to make money will be allowed, then having more money and basic "high agency" mindset will lead to making money in increasingly perverse ways.
To me the end game seems to be a race between authoritarianism (will these high-agency wealthy types just be able to keep the poorer class under lock and key with TikTok feeds to placate) and collapse (maybe they don't get the poor under deep enough control before the poor realize they've been given a deal that justifies trying to raze it all and start again)(edit: or maybe better framing, they realize they collectively have no meaningful part in the wealth and raze it)
To me everything you've identified is either 1) Corruption or 2) Consumers being sheep.
If the kids sports is a profit seeking cartel that you do not agree with, then do not give them your money. If enough customers do that they will not be profitable and will cease to exist once they can no longer extract investor capital from the very class this post seems to dislike.
Really roughly speaking the American consumer needs to stop being so complacent and naive, the American voter needs to get a good bit more politically active, and people need to stop choosing comfort over action. the average 2.5 hrs a day on social media could easily be spent to make their lives much better.
The market is not able to fix corruption. Regulation is needed. For example, exploitative labor practices weren't ended in the early 20th century because of customer preference. Laws had to be passed.
The global billionaire class now numbers roughly 3,500 people and collectively controls around $15–20 trillion in wealth. That's about the annual GDP of China.
That's about twice as much as the lower 50% of the population (2% of the world's wealth)... a class consisting of 4 billion people.
Why do people pretend "right actions" has anything to do with it. "Right actions" aren't even possible at that scale of difference. How does "earning" even make sense at these proportions? you think 3500 people are doing that much more than 4 billion others?
The capital of those 3500 might be.
The P/E Ratio of the S&P 500 is at a historic high level. Interpreted another way, there rarely is a better time to create a profitable business -- You can get paid $30ish dollars per annual dollar of profit you create.
On the flip side, it's never been so expensive to be an investor of capital. In order to get a return you have to wait 30 years (or 10 if you take growth rates into account), just to see your initial investment. An expensive stock market makes current consumption more rational for investors.
that capital might also be doing a lot more if not bottlenecked by the 0.000001% of the population controlling it
but let's not pretend that "right" has anything to do with it... that's like the scale of a single bacterium doing the right thing to turn itself into a school bus
Very hard to parse, not very helpful, and blatantly wrong. Cutting through the slop, the "bottom 50% of households" average income is said to be $22,907 without any expenses? The middle 20% making $60,298? That's...very obviously incorrect.
The median household income is $83,730: https://fred.stlouisfed.org/series/MEHOINUSA646N
The average for the bottom 50% of households is $30,000-something. Would take too much effort to figure out the exact figure for a comment, but still way higher what this site says, and I still feel like this is more effort than went into this misinformation site.
Its own linked source says that for 2022 the bottom quintile makes $26.2k before taxes and transfers and $44.8k after, while this site says $17.2k after. No wonder it's coming up with such wacky conclusions like saying a majority of America is going into debt while only buying the bare essentials and nothing else. If you use the correct income numbers, even the bottom quintile averages out to having $16k extra after essentials.
There is a per person and per household toggle. That is where the lower numbers are coming from. I'll try and make that more clear.
Yes, I was initially confused by the title and the content talking about two different things. I've edited my post with the correct numbers now. Even the household numbers are wrong, and the taxes and benefits numbers are very wrong.
What does not help, in my opinion, is that the wealthy people often have enough resources to optimize their taxes to a point where they pay much lower rate than their fair share. While the others cannot afford to do that and pay the full rate. That in itself creates inequality.
If a base rate that the society agrees on is e.g. n %, then, in my opinion, everyone should pay that n %. But in reality the poor people pay n % because they have no time to even think about optimizing it. As they often work around the clock to make ends meet. While the richer people hire professionals to take care of their taxes and optimize them to the extent that they pay significantly less than n %. And then there are super rich, some of whom, such as Donald Trump, pay almost no taxes at all.
This is, in my opinion, wrong and significantly contributes to wealth inequality. And therefore I believe that it needs fixing.
This is vibe coded I guess? Toggling the "Happiness plateau line" does nothing.
>Made by Patrick Glenn by way of Claude and ChatGPT. Code under the MIT License; text and charts under CC BY 4.0.
> Code under the MIT License
If the code is written by an LLM, then it can't be copyrighted, and a license can't be applied.
Why do you believe that?
It's a basic principle of copyright that only a natural person can be an author.
The US Copyright Office has stated such: https://www.copyright.gov/ai/Copyright-and-Artificial-Intell...
The Council of the EU has also stated such AFAIK.
fixed.
A visit to Disney World introduces some questions that bring doubts to this article. The park is overrun with young families, with a great many speaking English as a second language. They don’t seem to be top percenters, but they’ve got cash for tickets and food. ( The food seems to be priced about 5x what I’d imagine it to be at a real store. )
If they truly are poor, they’re surely living YOLO.
The Disney World visitors are a specific group of people. The vast majority of them do not go there every week, nor every month. So the behavior you observe in there is not representative of the routine behavior of those people.
In other words, yes, they may pay 5x the price for a meal in an amusement park that they visit once a year. That does not mean they are willing to pay anything close to that for a meal every week or every day.
It's my observation over time that there has been a sharp increase in the what people would call the "bare minimum" life. I think it's a combination of credit, a loss of stoicism, and social media pushing a distortion of reality.
I mean, Piketty showed this a decade ago in capital in the 21th century: the higher your income percentile and wealth percentile, the higher saving rate and the higher returns on your investment (which is negative for folks at the bottom of the distribution).
Of course the other problem with the projection is that BLS average expenses aren’t super accurate to project what people are spending on at those income percentiles :)
I don’t think that many people have read Piketty given how dense his work is. I’m glad I share my native language with him which makes it a bit easier to understand some of his points, but his writing is really difficult to grasp IMHO
This is hiding the real truth. Rich people invest more money and its a good thing that they invest because the investment goes into productive areas which ends up back into consumption.
The other way round is much much worse - imagine if rich people don't invest but rather just consume. It _takes_ away money from poor instead of building more wealth for everyone.
So the overall point being made here is not that true
This is just trickle down economics, which has led to great wealth inequality while the middle and lower class wages have stagnated as inflation has gone up. What really helps is strong social safety nets and programs that help struggling people. The Nordic model leads to better societal outcomes.
This is just trickle down economics, which has led to great wealth inequality while the middle and lower class wages have stagnated as inflation has gone up and more people have to rent instead of owning their own porpoerty. What really helps is strong social safety nets and programs that help struggling people. The Nordic model leads to better societal outcomes.
I shape economy is real
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Okay, this site is becoming unreadable slop.
Flag and move on
i’m pretty skeptical of this analysis because it (by default) hides the effect of welfare and advocates for a wealth tax. Hiding the existing social safety net in order to advocate for taxes feels very propagandistic.
good point. taxes and welfare should probably be on by default. ill change that.
I just thought it was a better illustration, easier for the average person to comprehend without those.
I didnt mean to do any advocating. Just provided the info because I wanted to see how it'd affect things.
More than propagandistic, it calls into question whether they are actually trying to solve a problem at all. The US has considerable support for low income families. That's a good thing, if you don't want to even see whether it works, what's your goal?