Why should I/Anyone care (that/if) 99% of the wealth is held by 1% of the people?

[Todderbob]

I read it all the time: America is messed up because 90-something percent of the wealth is held by (single digit) percent of the people.

My question is: Who cares? Or, Why should I care personally?

My quality of life is good, I have all I could really want. At this point, all more money would do for me let me buy flashy stuff. I own a tier 2 import car, which I bought used, which is easily mistakable for a BMW or Lexus – it’s as nice in every way except the emblems/badges, a big screen TV, I have Cable, an xbox 360, an HTPC, iPad and iPhone. Frankly, at this point I feel like I have too much stuff sometimes (but not often enough for me to want to get rid of any of it :p). Why do I need, or why does anyone in my income bracket (household, upper middle/lower up, individual, middle probably) need more money?

I can understand wanting more money, but why is it a problem if someone else has more money?

I’m not talking about tax policy, why it’s advantageous to tax rich more than poor (I’m of the opinion that rich should be taxed more, but not because they have more, but because they can afford it, and income is the easiest way of determining that).

I’m talking about the statement, that you hear all the time in one manner or another, “You know there’s a problem with Americas Economy because 90+% of the wealth is held by 10-% of the people.” I just don’t think that, in itself, is a problem.

I think what is a problem is that the lowest 20% of income don’t make enough to support themselves, especially if there’s an emergency. But that’s a separate issue entirely than what portion of the wealth they control is.

If they could make it happen at 1USD/person, then who cares if they (collectively) control .0001% of the nations wealth?

[beowulff]

Because, in a Democracy, it’s considered to be undesirable when a handful of people can exert their influence over society as a whole. Since in the US Money = Power, and we profess to be an egalitarian society, having a fraction of the population dictate their whims to everyone else is considered to be a bad thing.

[Inigo_Montoya]

@Todderbob

I’m not talking about tax policy, why it’s advantageous to tax rich more than poor (I’m of the opinion that rich should be taxed more, but not because they have more, but because they can afford it, and income is the easiest way of determining that).

No, the wealthy should be taxed more because the government provides the greatest benefits to the wealthy.

[DCnDC]

@Todderbob

I read it all the time: America is messed up because 90-something percent of the wealth is held by (single digit) percent of the people.

Isn’t this an inevitability of the capitalist system?

[JKilez]

And that’s the only thing I need is this. I don’t need this or this. Just this ashtray… And this paddle game. - The ashtray and the paddle game and that’s all I need… And this xbox 360…

If you are happy were you are at, then that is great. No one is calling you a jerk or anything.

The wealth figure that you mention, though, is an indicator of the strength or prosperity of the middle class in general. When that ratio is extreme, more people have less discretionary income. When real spendable income is reduced for a large swath of the population, less money flows in the economy through normal commerce. Taken far enough, the economy stagnates. Short of that, it just means that prosperity for most is diminished, even if other indicators bode well.

That’s what Obama should do–provide each home an Xbox 360! We will still be poor and dumb, but we would be OK with it.

[firstname]

Anyone remember a website that you could put in your yearly income and it would tell you what percent of wealth you were compared to to the rest of the world? /slight hijack

[even_sven]

I don’t think it’s the concentration of wealth itself that is a problem but rather what that means for the system as a whole. With wealth comes power, and I think we all agree that it’s a problem if 90% of the power is held by 1% of the people. This particular factoid is just an illustration of one of the many ways our society is unbalanced,

[Nametag]

@firstname

Anyone remember a website that you could put in your yearly income and it would tell you what percent of wealth you were compared to to the rest of the world? /slight hijack

You’re probably thinking of this.

[madmonk28]

It’s pretty much the definition of a third world country (I happen to believe that is the course the US is on). With the wealth concentrated in this way, political power will follow suit. What happens is that you end up with pockets of hyper-privledged citizens and a great neglected mass. The middle class will evaporate. There is a misconception that the third world is all open sewers and chickens in the roads, there are actually pockets of comfort and wealth surrounded by squalor.

[rowrrbazzle]

Odd how your prediction for the USA and the reality of Communism coincide. And it seems like the welfare states of Europe are going that way, too.

[Wesley_Clark]

My personal views on the subject

1. Productivity constantly goes up, but all the economic benefits go to the top. In the US we work about 1800 hours a year, in Europe people work closer to 1400 hours a year. Despite that Europeans arguably have a higher standard of living than we do because they have more security, more affordable services and more social mobility. Europeans also have a lower gini coefficient, so the productive wealth of their labors is spread more evenly among the bottom 90%. So in the US we work more hours for less security and benefits because our extra labor goes to making the wealthy wealthier. People complain that we work 300-400 hours a year in order to pay taxes, but we arguably work another 300-400 hours a year (compared to europeans) to make the top 1% richer. We work more hours and have a lower standard of living because so much wealth goes to the top. Per Capita income in the US is $50,000 if you divide population by GDP. But real per capita income for the bottom 90% is closer to $12,000 a year. So people work harder, produce more wealth, and have less to show for it than other nations.

2. When wealth congregates at the top it is easy for the wealthy to subvert democracy and create an oligarchy designed to benefit them. You can buy political parties, media outlets and public opinion with your pocket change. Koch industries, the Waltons & the Coors foundation on the right are billionaire groups pushing right wing agendas, while the Democracy Alliance on the left pushes liberal agendas. But fundamentally it is a tug of war between superwealthy groups and individuals finding ways to push their ideas on the rest of society. When wealth congregates, it is easier to slip into oligarchy, which is undemocratic.

3. Wealth isn’t infinite. The costs of health care, education and real estate have skyrocketed while wages have stagnated. So people are going bankrupt, living with family members and avoiding seeing a doctor because they can’t make ends meet or live like their parents generation. Asking people to pay higher expenses with lower incomes isn’t sustainable. When the middle class collapses, so does the economy. The US economy is driven by consumer demand, and as the bottom 90% are driven further and further into bankruptcy and desperation demand collapses, and it will bring the US and global economy down with it.
   The fact that you are doing OK financially (many others are not) doesn’t mean that our current economic system is sustainable or democratic.

[Happy_Fun_Ball]

@Nametag

You’re probably thinking of this.

Damn, no matter how much money I make there are still 107,564 people richer than me. Try it.

[Snowboarder_Bo]

@Wesley_Clark

My personal views on the subject

1. Productivity constantly goes up, but all the economic benefits go to the top. In the US we work about 1800 hours a year

[nitpick]

A US work-year is 2000 hours.

(8 hours per day) x (5 days) = (40 hours per week) x (50 work weeks per year) = 2000 work hours per year.

Note that this includes 2 weeks unpaid vacation.

Your 1800 hour figure misses 5 weeks of work.

[/nitpick]

[Der_Trihs]

@Todderbob

I read it all the time: America is messed up because 90-something percent of the wealth is held by (single digit) percent of the people.

My question is: Who cares? Or, Why should I care personally?

Because the country is likely to collapse because of it, since the rest of us are carrying them on our back. They are allowed to hog more and more money and power at the expense of everyone else. And we aren’t going to force them to pay their fair share towards running the country no matter how high the debt rises or how badly the nation falls apart; we’d rather see the country collapse than force the sacred, godlike rich pay what they owe.

[Blalron]

@Snowboarder_Bo

@Wesley_Clark

My personal views on the subject

1. Productivity constantly goes up, but all the economic benefits go to the top. In the US we work about 1800 hours a year

[nitpick]

A US work-year is 2000 hours.

(8 hours per day) x (5 days) = (40 hours per week) x (50 work weeks per year) = 2000 work hours per year.

Note that this includes 2 weeks unpaid vacation.

Your 1800 hour figure misses 5 weeks of work.

[/nitpick]

You assume that everybody has a full time job. Many people work less than that.

[Todderbob]

@Der_Trihs

@Todderbob

I read it all the time: America is messed up because 90-something percent of the wealth is held by (single digit) percent of the people.

My question is: Who cares? Or, Why should I care personally?

Because the country is likely to collapse because of it, since the rest of us are carrying them on our back. They are allowed to hog more and more money and power at the expense of everyone else. And we aren’t going to force them to pay their fair share towards running the country no matter how high the debt rises or how badly the nation falls apart; we’d rather see the country collapse than force the sacred, godlike rich pay what they owe.

How are they “riding on our backs” though? How is a rich person who doesn’t do anything riding on your back any more than a poor person who doesn’t do anything, or a retired person who doesn’t do anything?

How are they going to make the US collapse, beyond some vague sense of unease you feel around the ridiculously wealthy?

At those who said: “I’m assuming I’m okay, but others are not.” No, I’m not. I specifically said being poor is a problem, I asked why the 90+%/10-% problem was specifically a problem, or if it was just a shock value number that isn’t, in itself, a problem in an otherwise functional system.

For instance, say we had no scarcity of basic goods in the USA, for whatever reason. Then it wouldn’t matter if one person controlled 99.5% of the wealth, because everyones basic needs would be covered. On the other hand, if the wealth were perfectly evenly distributed after a nuclear holocaust, it’d be pretty irrelevant.

[scr4]

@Todderbob

I can understand wanting more money, but why is it a problem if someone else has more money?

I think the main issue is whether everyone has equal opportunity to get rich. If it’s just a function of how hard you work, and how much time you invest in education/training, I don’t think anyone would complain about the resulting inequalities. But that’s not the way it works, there’s also a strong positive feedback - i.e. easy for rich people to get even richer, but difficult for poor people to get even moderately rich.

[Bosstone]

@scr4

@Todderbob

I can understand wanting more money, but why is it a problem if someone else has more money?

I think the main issue is whether everyone has equal opportunity to get rich. If it’s just a function of how hard you work, and how much time you invest in education/training, I don’t think anyone would complain about the resulting inequalities. But that’s not the way it works, there’s also a strong positive feedback - i.e. easy for rich people to get even richer, but difficult for poor people to get even moderately rich.

Louis CK sums it up best with the way banks function:

What kind of a system is that? They have people at the bank that go, “Okay, some of these people don’t have enough money, so we better take their money away from them because they have so little.” That’s it! There’s no better explanation than that. Then they go, “These people have so much -” if you have a lot of money, they give you money. Just for having it! They go, “You have so much money, that, I mean, we should give you more because you have so much!”

[Der_Trihs]

@Todderbob

@Der_Trihs

Because the country is likely to collapse because of it, since the rest of us are carrying them on our back. They are allowed to hog more and more money and power at the expense of everyone else. And we aren’t going to force them to pay their fair share towards running the country no matter how high the debt rises or how badly the nation falls apart; we’d rather see the country collapse than force the sacred, godlike rich pay what they owe.

How are they “riding on our backs” though?

By sucking the country down into debt and letting the infrastructure collapse just so that can have low taxes. By using their grossly disproportionate wealth to control the nation politically and shape everything in it to their benefit at the cost of everyone else. By ensuring that we, the bottom 90%+ of the country with the lesser share of money pick up the slack for their tax cuts and regulation slashing; after all, if we die due to the lax enforcement of health and safety regulations or because levees break, or just have to live in a wasteland of decay, we don’t count because we aren’t people by American standards. Only the rich are people.

[Sage_Rat]

@Todderbob

I read it all the time: America is messed up because 90-something percent of the wealth is held by (single digit) percent of the people.

Actually, if you multiply a salary by the number of people at that salary, you get a graph that looks like this:

In reality, wages generally are pegged at increments of $1000, so the graph would be far more jagged, but the message is the same. Nearly all money is held by people making below $100k per year, with the peak occurring somewhere around $25k. If you gave all the money held by those making under $100k to everyone making over $100k, the wealthy would have many multiples the wealth that they have now. But if you were to take all of the money from everyone making over $100k and spread it out evenly to those under $100k, everyone wouldn’t be anything more than maybe like $50 wealthier per year.