Americans Are Horribly Misinformed About Who Has Money • Hacker News Board

Re: Americans Are Horribly Misinformed About Who Has Money

#191

Post by IvanAcostaRubio » Tue, Dec 28, 2010, 9:26 PM UTC

pelle wrote: post #167

dkarl wrote: post #130

Earlier quoted context omitted.

Are you suggesting that if you removed the grossly incorrect image of reality someone has and replaced it with a radically different one, that they would have the same opinions about closely related policy questions? I'm skeptical. People try to keep their view of reality in line with their political beliefs. How do you think Americans end up believing such wacky things? The survey show something like 19% of people t…

The whole problem with these scaremongering articles about equality and the lack of it is that it doesn't matter. They promote this because it fits in to their zero sum world view. A world where it is always someone-elses fault and where we as community must do something or we are selfish. This world view thats based on Dickensian stories of children living on the streets with coal dust on their cheeks. It just isn't…

"The richest people in the US (the ones with 80% of the wealth) have probably in most cases earned it"

That is a lie. Only a negligible fraction of actual capital accumulation can be tie to life cycle savings. Therefore, we must conclude that intergenerational transfers account (inherit capital) for the VAST MAJORITY of aggregate capital accumulation in the USA.

See an MIT/Yale study on the subject. http://bit.ly/fjmyIw

I am not advocating a cero sum game or that everybody should be equal, but when you have the VAST majority of capital in the USA being inherit, the merit of earning that capital fades away pretty quickly.

Re: Americans Are Horribly Misinformed About Who Has Money

#192

Post by hackinthebochs » Wed, Dec 29, 2010, 2:44 AM UTC

pelle wrote: post #190

hackinthebochs wrote: post #185

Earlier quoted context omitted.

Assuming it wasn't inherited, I would still argue that its mostly unearned. I don't believe "passive" income is earned. In most cases, wealth over a certain threshold is essentially passive generation--money making money. The wealthy own the means of production and when technology advances makes this more productive, they're able to create more passive wealth. I don't consider this earned wealth. The same goes for ba…

What do you mean passive income isn't earned? Isn't someone's pension earned? What about VC's? PG? Isn't PG earning his keep or is he just sucking blood out of the productive masses? What is going on with this kind of neo marxism on HN?

A pension is more deferred income than anything, so it isn't passive. I don't know the details of how PG gets the money he invests, but for what he does there isn't a requirement that he have millions to begin with. He could simply be manager of a fund. And whether he's earning his keep or sucking blood depends more on the specific arrangements.

If PG's terms were that he collect 100% of the profits of successful companies, while paying people a flat rate, then yes he would be 'sucking blood from the productive masses'. Yet, this is essentially what happens in most other spheres. Those who own the means of production let those on the bottom use their "property" while keeping the ever-increasing profits to themselves.

Yes, everyones quality of life increases, but at a radically disproportionate rate. At this point the income is passive and there should be a line where you're not entitled to any more of it.

Re: Americans Are Horribly Misinformed About Who Has Money

#193

Post by billybob » Wed, Dec 29, 2010, 6:58 PM UTC

zacharypinter wrote: post #162

jshen wrote: post #98

Earlier quoted context omitted.

and there was no evidence given to support the original statement. How is quality of life for the middle class better now even though the disparity between them and the rich is far larger than before. I think I gave concrete examples of how it's worse, which is more than the OP.

An economist (I forget which one) posed an interesting thought experiment: Would you rather be a millionaire 100 years ago, or middle-class today. Sure, some people would choose 100 years ago, but a large majority of people, when asked, would rather live a middle-class life today than as millionaires 100 years ago. Clean water, sewer systems, restaurants, the Internet, television, microwaves, dishwashers, transportat…

I'd also choose being middle-class today, but there are several complicating factors.

1) Loss aversion. I know that I like modern conveniences and would hate to lose them. Psychologically, we place greater weight on losing something than getting something. Maybe I'd be dumb not to give up my microwave burritos for fresh roasted grouse, but the burritos are comfortingly familiar.

2) I'm just guessing about fresh roasted grouse. What ARE the nice features of being a millionaire 100 years ago? I'm probably ignorant about most of them. Maybe people back then would pity me for not experiencing what they did.

3) I'm a bad estimator of what will make me happy. Sure, I like the internet. Does it make me happier, or does it just scratch weird psychological itches? People WANT to play Farmville, but does it make them happy? Maybe I'd be happier having 10 close friends in my neighborhood and no telephone than having 200 friends on Facebook.

The one thing that's hard to dispute is that illness was more likely and more painful in the past. Other than that, whether then or now is better is something I'm unable to judge well. And I suspect the same is true for most people.

Re: Americans Are Horribly Misinformed About Who Has Money

#194

Post by billybob » Wed, Dec 29, 2010, 7:06 PM UTC

arvinjoar wrote: post #12

pg wrote: post #6

I wouldn't be surprised if most respondents are answering as if the question were about income rather than wealth.

Exactly, and I can't see why the charts shouldn't look like this. Saving money is a luxury, it's a good thing to do if you can afford it and if you're saving your money for something worthwhile. What's important is that people are living the lives they want to be living, and I'm sure that's possible without lots of savings (although wealth could probably help). Most people like to spend money now instead of later tho…

Saving money is not a luxury. It's completely irrational not to save unless you are truly destitute.

Put it this way: you have a car. Sooner or later it will break. Are you preparing for that? Are you setting aside money to repair and replace it - money that earns you interest while it builds up? Or are you borrowing money and spending all your money on payments, risking that you won't be able to pay rent if your transmission breaks?

OK, if you make minimum wage, this is hard to get out of. But it's possible. Can you live with your mom? Can you drive a worse car? If you can get that thing paid off and get ahead of the debt, get some savings going, you'll be on a moving sidewalk to better finances, less stress and unhappiness, etc. If you're spending everything on a payment, you're on a treadmill pushing you toward bankruptcy.

Yes, it's hard to make do with a small income. But saving is something that really, almost anybody can and should do. Liking to spend money NOW should not overrule our desire not to be thrown out in the cold next month, or our desire to sleep peacefully. There must be a balance, and all but the most destitute can do this. By which I mean "half a cup of rice a day."