Being another bald statement substantiated only by the World’s Foremost Authority. Seems that for such a powerless and obscure minority, they do rather well when it comes to tax policies and such. Why do you suppose that is, Starv? The thanks of a grateful nation?
So the solution to a set of people having undue influence in legislation is to pass legislation removing the undue influence?
Certainly somebody managed to reduce the rate they pay from what it was, to what it is. Without disproportionate power, how was that accomplished? The thanks of a grateful nation, a universal outpouring of gratitude for all that they have done to us? For us. All they’ve done for us.
Maybe, but I’d be willing to bet that “crippling” is your term, not his. And it stands again as substantiated only by your awesome Authority.
Well, then, who needs them? If they money is already where it should be, what good are they? If we replace one rich man with a couple thousand of lesser standing, isn’t that a benefit without a down side? We may, of course, lose the wise counsel of the American Enterprise Institute, or the Heritage Foundation, but I trust we will manage to struggle along without them. After all, we have you! You say almost exactly the same stuff, and are vastly more entertaining.
There goes the uninformed use of " socialist" again. They try to open the government to scrutiny. They don’t think the working of the government should be kept from the citizens who pay for it.
I did not know capitalism was supposed to be a war between the haves and have nots. I thought Americas strength was that our people made good products and got good wages. We impacted the economy by the buying power of Americas people. Gutting the middleclass and moving jobs abroad is not a tactic that has the best interests of the country as part of the equation. Our corporations have gone from job producers to job killers. They use tax shelters and avoid paying their fair share of taxes.
The top 1% in America in 1983 had 33.8% of the wealth. By 2004, that percentage had grown to a shocking… 34.3%. Want to bet that with the recession the top 1% now have less of the country’s wealth than they did 30 years ago?
To get to 90% of the wealth, you have to drop down to about the top 25% of the country. The bottom 80% of the country has 15% of the wealth. But over 60% of the wealth held by the top 10% is in the form of business assets. In other words, they own companies. This is not a bad thing. You generally want your companies to be owned and run by the cream of the crop.
Those numbers might look familiar to anyone who has learned about Pareto’s principle, or the 80/20 rule. In any large complex system, 80% of a measure comes from 20% of the sample. To within an error range of a few percentage points, this rule holds across wide swaths of human behavior. 80% of crime is caused by 20% of the population. 80% of the wealth is controlled by 20% of the population. 80% of tech support calls come from 20% of the customers. 80% of productivity comes from 20% of employees. And on and on and on.
This is what happens when people are free. Some people work harder, save more, are smarter, more industrious, have better judgment, etc. They tend to rise to the top. But they do so because they are benefiting everyone else in much greater proportion than do the average people in the population. The guy who stays at work at night and busts his ass to meet a deadline goes farther than the guy who punches the clock at 5pm regardless. But the first guy is the one who helps products stay in budget, who helps people afford those products, who helps businesses stay profitable so they can create more products for everyone. Everntually, that guy will be rewarded. And probably hated by the guy who punches the clock and thinks the other guy got lucky or kissed the bosses’ ass to get where he is.
If you could wave a magic want tomorrow and evenly distribute all the nation’s wealth across the population, twenty years from now 80% of it would again be in the hands of 20% of the population. The only way you can prevent this is to constantly take wealth away from the most productive and give it to the least productive. The long-term consequence of doing so means everyone will be poorer.
As for those measures above - The U.S. has a high poverty rate only because poverty is measured against GDP in the same country. This makes it impossible to compare poverty between countries. But tell you what: treat the world as a whole, and convert income to purchasing power so you have a common measure of how wealthy people really are. Now use 60% of the world average as the poverty line, and see where the U.S. stacks up.
I’ll give you a hint as to what the outcome will be: The poverty line for a single adult in the U.S. is higher than the world median income. In terms of equivalent purchasing power, 36% of the people in France live below the U.S. poverty line.
In addition, the income used to determine poverty does not include benefits such as Medicaid, refundable tax credits, food stamps, school lunches, or any of the other numerous government benefits available to the poor. That might give you a hint about the real purpose of the ‘poverty line’. It’s not a measure of real well-being - it’s a political weapon. If you were trying to really measure hardship, you’d include every aspect that affects quality of life. But now you can use the poverty line to justify giving everyone below it a $5,000 refundable tax credit - and the number of people defined as having income below the poverty line won’t change despite them all being $5,000 richer.
So how are the poor in America doing?
The median size of a home for people below the poverty line in the United States is larger than the median home size for an equivalent middle class family in France. Three quarters of the people living below the poverty line have a car, and 1/3 of them have two cars.
46% of families living below the poverty line own their own homes.
76% of families living below the poverty line have air conditioning.
97% of poor households have at least one color TV. 78% have a DVD player and/or VCR.
Most of these measures are better than what you’d find in the middle class in Europe. I guess a rising tide really does lift all boats.
Indeed, its a pretty good start! Gosh, sure hope none of those people are broken down to their last ten million, what with squandering their money on schools, clinics, roads, bridges, free heroin, stuff like that. But it seems these are a bunch of people who never tire of telling us how patriotic they are, how they love their country. They’ll be tickled pink, I’m sure.
You’re still way off. The top 10% have about 69% of the wealth.
By the way, that last measure was of total wealth. If you just look at income the tax system looks even more progressive. The top 1% earned about 17% of the income, but paid over 40% of the income tax.
For somebody who seems to have an otherwise decent grasp of statistics, you sure do come off as awfully naive about how the world works.
Person A is born to a well-off pair of parents, whose combined income equals six figures. Person A goes to good private schools for grade school and high school, and their college is also covered by their parents.
Person B is born to a single mom with no high school diploma who works two minimum-wage jobs. Person B is stuck with overcrowded inner-city schools and graduates high school, but they can’t afford college.
Assuming Person A and Person B put exactly the same effort into their schoolwork and their jobs, who do you think is going to be making more money at age 50?
Since I’m someone with a decent grasp of statistics, I can point out that while the U.S. has a fairly high measure of intergenerational elasticity (i.e. your parent’s income matters quite a bit in determining your own income), it’s actually higher in the UK, and almost as high in France. The U.S. measure is .47, which translates into a 22% better chance of being rich as an adult if your parents were rich. Which means the large majority of drivers of wealth for the average American are something other than how wealthy your own family was. By the way, in France, with its worker protections, and social programs and all the other trappings of egalitarianism, the influence of your parents declines all the way down to an amazing… 17%. Not that different.
Person A is pampered and develops no work ethic. Person A gets everything easily, and decides to take the easy road and live off mom and dad - and winds up unemployable. Person A just isn’t that smart. Person A decides that, since he comes from a wealthy background, he doesn’t need to study anything hard like engineering, and parties his way through college taking the weakest liberal arts degree he can manage.
There are many, many ways in which someone who is born with advantages can wind up not making a whole lot of money. Now bear in mind we’re not talking about the ultra-rich here. I’m sure the Rockefeller kids will be fine no matter what they do. Rather, we’re generally talking about kids in families where Dad is a doctor, or both parents are lawyers, or perhaps the family has grown a business and now has a million or two in assets. This is the type of situation that describes the large majority of people in the upper quintile, and it’s not as big an advantage as you’d think.
Hey, you just described me. How’d you know? Everything above describes my life perfectly. I even had to work after high school for three years until I could save up enough to manage to go to college while working part time. And I’m doing just fine.
In order of importance, I’d say the one who chose the right career, the one who managed to remain married, the one who is more intelligent, the one who avoided alcoholism or other addictions, the one who was most willing to change jobs when the need arose, and the one who saved the most money. Family influence is pretty high on the list, but it’s not the main determining factor. For example, IQ correlates to income to about the same degree as does parental wealth. There are lots of smart people who simply choose not to pursue high-income careers, or who have other character flaws which prevent their IQs from being determinative. Likewise, there are plenty of people with average intellects who made it big through sheer hard work, or by choosing the right career, or by having an entrepreneurial spirit.
Here’s another measure for you: If you were born to parents in the top income quintile (over 166,000 in income), the chance of you winding up in the same top income quintile is about 22%. If your parents are in the middle quintile (total family income of $50,000 to $70,000, or right smack in the middle class), your chance of reaching the top quintile declines to about 6%. Either way, at least 8 out of 10 kids are going to have to work for what they get. Being born rich isn’t going to do it.
But if you’re happy just making it to the upper middle class ($98,000 or over), you’ve got a 25% chance of making it if you come from the middle class, vs a 50% chance of making it if you’re born wealthy. And if you’re born poor, in the absolute bottom quintile, you’ve still got a 60% chance of making it into the middle class, a 20% chance of making it into the upper middle class, and a 6% chance of making at least 98,000 per year.
So yes, wealth is an advantage, but it’s not an overwhelming advantage. And the majority of people born poor move up into at least the middle class.
Diogenes, I’d like to point something out for your consideration.
Your first guess as to the concentration of wealth and power was that the top 1% controlled 90% of the wealth.
I corrected you, and you said, “Okay top 10%. Whatever”.
The actual ratio is that the top 10% have 68% of the wealth. This is a HUGE difference. A country with 90% of the wealth controlled by 1% of the population is an oligarchy or a monarchy. A country where where 20% of the population has 80% of the wealth is a meritocracy.
Yet, the difference apparently is completely irrelevant to your worldview. You don’t seem to even care what the real number is. So, I would suggest you think a bit more about your motivations and logic.
Sorry, gov’nuh, we did our best with him, trying to teach him the difference between a beastly, wretched oligarchy and the shining truth of meritocracy, but he would just yell “plutocracy” and, well, what are you gonna do…
So… I’m right, but other countries are bad, too, so it doesn’t matter? Thanks for proving that you were wrong about success in the U.S. being determined mainly by how hard you work and/or how smart you are.
I **specifically posited **that Person A and Person B put in the **same **amount of effort. Sure, there are plenty of circumstances where the person with the better situation doesn’t take advantage of it, and the person with the worse situation works extra-hard to overcome the extra hurdles placed in front of them. But that’s not the hypothetical–I was testing your assertion that effort is truly the determiner of success in the U.S., generally regardless of personal circumstances.
How about avoiding cancer, as long as we’re talking diseases? 'Cause you can pick those, right?
Because when you’re stuck in a minimum-wage job because you had to drop out of high school to help take care of your family, you **can **afford to put 20% of your paycheck aside! And boy, that $3k a year in savings is really going to help you succeed! You’re going to be right up there with the guy who brings home that much in a paycheck!
Let me be clear: Success in the U.S. is largely NOT determined by how wealthy your parents are. Your family’s wealth makes up about 22% of the total sum of effects that determine your own adult income status.
There is no doubt that coming from a wealthy family is an advantage. It would be silly to think otherwise. But it is not an overwhelming advantage. Coming from wealth is not a guarantee of success in America, and coming from poverty is not an insurmountable wall, or even a grinding uphill slog. I know many, many people who come from poor backgrounds, because that’s where I and most of my friends come from. So I know exactly how hard it is to ‘make it’. You have to work harder. You might have to delay gratification more than the richer kids do. You might have to work part-time in college, and you might have to go to the college that happens to be in your town rather than have the luxury to move away from home and go to the college of your choice. When spring break arrives, the rich kids go to Cancun and the poor kids sign up for extra shifts at the grocery store.
But you CAN go to college, assuming you’re smart enough. And really, the advantage that the kids from rich families have ends once you graduate from college. When I’m hiring people, their financial background is totally irrelevant to me, and I guarantee that that’s true for just about everyone who hires people in America. The disadvantage of poverty pretty much centers around the added difficulty of getting a good education.
And that’s why parental wealth is a relatively weak force. Because ultimately, the kind of education you get has a lot more to do with factors other than your parent’s wealth. It has more to do with your own intelligence and work ethic, your choice of faculty, your willingness to work hard, and your willingness to sacrifice to get what you need.
I hope you understand that this particular tool you’ve chosen to demonstrate your point is completely useless. Here, watch me prove that America is a ‘Tallocracy’:
“If you hold all other factors completely equal - if two people come from identical backgrounds, have identical educations, work exactly as hard, and in all other ways are identical, then the taller one will make more money than the shorter one.”
That is a true statement, because height has been shown to be somewhat determinative of success. But it’s a small factor. But if we hold ALL other variables constant, then yes, your wealth will be determined by your height.
This in no way gives us any insight as to whether we need to enact social policy to mitigate the advantage of height in America.
Have you ever heard of the five dollar millionaire? My grandparents retired with a net worth of close to a million dollars, and my grandfather was working as a pump jockey in a gas station when he was 55 years old. What they did was save their money. Eventually they got enough to put a down payment on a farm, then they worked their asses off, built their own home, and grew their wealth once they owned their own property.
My mother earned minimum wage or close to it her whole life. But she saved enough money to put a down payment on a small duplex, then paid it off and used the equity to buy a small country store, and had a perfectly happy existence with enough money for her needs, then sold the store to pay for her retirement.
You’d have a much better argument if you’re limit your class distinctions to minorities in inner cities who honestly have many barriers in front of them. But if you’re a white kid from Muncie Indiana whose parents just happen to be poor, your personal outcome is going to have a hell of a lot more to do with your own behavior than with your parent’s wealth.
By the way, if you could put away $3,000 per year, and you earned the historical average of 10% on your money, and you started doing that at age 25, then when you retire you would have 1.6 million dollars in the bank. Or if you put away $1,000 per year (not outrageous - less than the cost of a pack of cigarettes a day), then at retirement you’ll have half a million dollars. The miracle of compound interest.
Well, it could be the Lefties out to make you look all foolish…
Or it could be a function of VBulletin put in place for perfectly good reasons having nothing to do with your political views, doing what it’s supposed to.
I think a better question should be what was the share of that top 10% say in 1940, 50, 60, 70 etc. The speculation is their share has been on a dramatic rise and eventually the middle class will erode away. When does it become a problem that even conservatives will become be alarmed? The top 10% now have 68% of the wealth, what if they have 75%, 80%, 90%.
What will stop the ever increasing share of those at the top, some don’t care if the top have 90% the rest are just lazy losers. Huge income disparities are the seeds of violence and revolution. I am reminded of that 1940s billboard of the family in the car with the caption “America, highest standard of Living in the World” I wonder what share of the top 10% was then?
Thanks for proving that you were wrong about success in the U.S. being determined mainly by how hard you work and/or how smart you are.