40% of Americans can't cover a $400 emergency expense • Hacker News Board

Re: 40% of Americans can't cover a $400 emergency expense

#191

Post by dpark » Wed, May 23, 2018, 12:27 AM UTC

sigstoat wrote: post #188

dpark wrote: post #157

Earlier quoted context omitted.

The average American spends about twice that on just beer (not all alcohol) every year. I share your concern for poor people dumping money into the lottery, but that’s actually a pretty small vice.

easier to get rid of lotteries; no constitutional amendment required. some of the beer spending also comes from people more able to tolerate the wasted funds; those with the least are the most likely to play lotteries. https://journalistsresource.org/studies/economics/personal-f...

I’m not sure that’s true. The Supreme Court just struck down an anti-gambling federal law.

https://mobile.nytimes.com/2018/05/14/us/politics/supreme-co...

It’s not clear at all that the federal government could ban the lottery without a constitutional change.

Re: 40% of Americans can't cover a $400 emergency expense

#192

Post by scarface74 » Wed, May 23, 2018, 12:28 AM UTC

maxsilver wrote: post #187

scarface74 wrote: post #178

Earlier quoted context omitted.

Yes and when they demand change and start "taxing the rich". You're going to find that a lot of doctors, lawyers, and people in IT who are making low six figures are going to be classified as "the rich".

> "According to statistical data from the Internal Revenue Service (IRS), the top 1% had an adjusted gross income of $465,626 or higher for the 2014 tax year." "Doctors, lawyers, and IT people making low six figures" have absolutely nothing to fear. And for the extremely few fortunate people who actually make more than half a million dollars each year, they will easily be able to afford the new taxes.

You really think the "populists" who want to "tax the rich" are going to stop At the 1%? It's not the 1% they despise - as evidence by the election - it's "the liberal west coast elites". The other 80% with households making less than $116K year would just as likely start taxing everyone who makes more than that.

Have you noticed that most tax deductions that are designed to help the middle class phase out in the $120 - $160K?

Re: 40% of Americans can't cover a $400 emergency expense

#193

Post by jartelt » Wed, May 23, 2018, 12:32 AM UTC

maerF0x0 wrote: post #34

I had a coach that when I'd ask about how to get out of tricky situations he'd often respond with something along the lines of "Bro, you f'd up a long time ago"... I don't think 40% is some magic number to begin hysteria. Neither is $400. Selling something to cover your expenses might be a blessing in disguise if the thing you sell is a liability in the first place (ex: a car you cant really afford). My observation o…

I bet a lot of the people with little savings would argue that they didn't F up, they just were born into a poor family.

If you are poor, it's much harder to take risks and try to get ahead. You are always on the hook for your rent and can't just go ask your parent for a 0% interest loan to help you out for a couple months.

Yes, a lot of Americans have bad financial habits and buy unnecessary things. But some of these people with little savings are doing everything they can to stay afloat and just don't have the luxury of doing an 8 week data science boot camp to get a better job (or they would miss rent and get evicted).

Re: 40% of Americans can't cover a $400 emergency expense

#194

Post by ryanx435 » Wed, May 23, 2018, 12:33 AM UTC

dragonwriter wrote: post #120

scarface74 wrote: post #110

Earlier quoted context omitted.

Why do I have the feeling that most posters on HN who consider themselves the "middle class", actually fall well above of the middle quintile of household income and most are in the 5th quintile. The true Middle Class probably don't make any distinction between anyone who is in the top 20% (household income over $116,000) or especially the top 10% ($161,000). https://dqydj.com/household-income-percentile-calculator-2…

> Why do I have the feeling that most posters on HN who consider themselves the "middle class", actually fall well above of the middle quintile of household income and most are in the 5th quintile. Because middle class in a capitalist society is an economic relationship between the captialist and working class (characterized by mixed dependence on capital and labor, most archetypically the independent operator who su…

It's funny to me that you are using words like proletariat and bourgeois, words used to describe class differences in an agrarian basee society/economy, to describe modern america, which is as opposite as you can get from an agrarian society.

The social Dynamics of the modern anerican situation have changed so much from when Marx was alive his labels no longer accurately apply.

Re: 40% of Americans can't cover a $400 emergency expense

#195

Post by skookumchuck » Wed, May 23, 2018, 12:34 AM UTC

> Those who don't have the cash on hand say they'd have to cover it by borrowing or selling something.

Be careful about concluding that these people are poor. I'm not poor, and I have no cash. Everything is invested. Piling up cash in a savings account just means it'll get eaten away by inflation.

This is hardly uncommon. If you've got a house with a large payment, you aren't poor, even though you may not have any cash. Your money is invested in the house.

Re: 40% of Americans can't cover a $400 emergency expense

#196

Post by jarfil » Wed, May 23, 2018, 12:34 AM UTC

roenxi wrote: post #96

sjg007 wrote: post #19

Earlier quoted context omitted.

We should but you know personal responsibility and all that jazz. The wealthy only care when the pitchforks come out. The biggest achievement of the wealthy has been to convince the middle class to eat itself.

The problem with personal responsibility, which I am very much in favour of and wish we promoted a bit more, is that the deck is so stacked against people who don't have assets that I'm not sure average person can keep up. I keep saying it; the amount of money in the system has increased +50% since 2008 [1], and worker compensation has gone up +25% (the BLS publishes a lot of series, I use [2]; hope it is right). So…

Some people are getting huge amounts of money just because they can, and today's society, with the growing relevance of intellectual property, is geared more and more towards income inequality.

It used to be that one could somewhat easily get $1M by just selling 1 million people some $1 items, however that required making 1M items in the first place. Nowadays one can get the same $1M by making just a single unit of IP, and selling 1M copies at $1 each. Sure there is no guaranteed way of knowing whether some IP will sell 1M copies, but that only turns it into a sort of lottery which exacerbates the inequality even more.

Given that money -and particularly M2- is credit, which is kind of an "intellectual property" on itself, it isn't really surprising that a greater amount of IP in circulation would also mean a greater amount of credit/money.

Workers who exchange their effort for a fixed amount of income, are just out of all this IP lottery and its income multiplying potential.

Re: 40% of Americans can't cover a $400 emergency expense

#197

Post by ryanx435 » Wed, May 23, 2018, 12:35 AM UTC

Maybestring wrote: post #181

dragonwriter wrote: post #166

Earlier quoted context omitted.

In discussion of capitalist economies, a rough definition (loosely following Marx) of the major classes is: haut bourgeoisie (capitalists): those who own capital and rent labor to apply to it. petit bourgeoisie (middle class): those who live by a combination of labor and capital, particularly those who apply their own labor (perhaps alongside a small amount of rented labor) to their own capital. proletariat (working…

Do I understand correctly that an Uber driver with a 30k capital investment in a car is part of the petite bourgeoise, and a surgeon working for a hospital who has put 400k toward education is part of the proletariat? Or do you count education as capital?

Marx's labels are so outdated it doesn't make sense to use them in our modern economy.

Re: 40% of Americans can't cover a $400 emergency expense

#198

Post by derekp7 » Wed, May 23, 2018, 12:36 AM UTC

Maybestring wrote: post #181

dragonwriter wrote: post #166

Earlier quoted context omitted.

In discussion of capitalist economies, a rough definition (loosely following Marx) of the major classes is: haut bourgeoisie (capitalists): those who own capital and rent labor to apply to it. petit bourgeoisie (middle class): those who live by a combination of labor and capital, particularly those who apply their own labor (perhaps alongside a small amount of rented labor) to their own capital. proletariat (working…

Do I understand correctly that an Uber driver with a 30k capital investment in a car is part of the petite bourgeoise, and a surgeon working for a hospital who has put 400k toward education is part of the proletariat? Or do you count education as capital?

Capital is something you purchase or work to build from raw material, or some combination. And an education (with or without a degree) is considered an asset. So why not?

Re: 40% of Americans can't cover a $400 emergency expense

#199

Post by dionidium » Wed, May 23, 2018, 12:36 AM UTC

skookumchuck wrote: post #195

> Those who don't have the cash on hand say they'd have to cover it by borrowing or selling something. Be careful about concluding that these people are poor. I'm not poor, and I have no cash. Everything is invested. Piling up cash in a savings account just means it'll get eaten away by inflation. This is hardly uncommon. If you've got a house with a large payment, you aren't poor, even though you may not have any ca…

A version of this comment appears every time this is discussed. This isn’t what we’re talking about. These aren’t liquidity problems. People really just don’t have the money.

Re: 40% of Americans can't cover a $400 emergency expense

#200

Post by skookumchuck » Wed, May 23, 2018, 12:38 AM UTC

alasdair_ wrote: post #165

ralusek wrote: post #72

Earlier quoted context omitted.

Being trapped in a debt spiral due to past financial desperation is just a way of iterating forward in the loop of bad decision making. What I am saying is that to enter financial desperation in the United States is not actually possible if you utilize the available social safety net and make proper decisions.

>Being trapped in a debt spiral due to past financial desperation is just a way of iterating forward in the loop of bad decision making. Imagine you went to a crappy school where you spent most of your days trying to avoid gangs rather than learning anything. You did everything people told you to do and you applied to some for-profit bullshit college that accepted you. You signed some paperwork that you literally did…

None of my public school classes ever mentioned compound interest.