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Economic Inequality: It’s Far Worse Than You Think

scientificamerican.com

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Re: Economic Inequality: It’s Far Worse Than You Think

#21

Post by sp332 »

brador wrote: post #7
ryandrake wrote: post #2

And, it's only going to get worse while [1] 39% of Americans either believe they are already among the top 1% or believe that they one day will be. If your mentality is one of "Don't tax the top because that's me (or will be)", you're going to constantly vote against your own economic self-interest, and continue to support policies that help the real rich get ultra-rich. 1. http://www.nytimes.com/2003/01/12/opinion/t…

You honestly believe that people think "Don't tax the top because that's me (or will be)"? I suggest people believe their jobs and technological innovations we all enjoy are on the line if the rich are taxed more. If that is true or not is a separate conversation, but I don't think it's 39% of Americans think they will reach the 1%. That's absurd and the kind of thing you hear in mass media sound bites.

The most telling polling result from the 2000 election was from a Time magazine survey that asked people if they are in the top 1 percent of earners. Nineteen percent of Americans say they are in the richest 1 percent and a further 20 percent expect to be someday.

Re: Economic Inequality: It’s Far Worse Than You Think

#22

Post by thecopy »

ghouse wrote: post #14
dandare wrote: post #4

The fact that someone is rich does not mean he took anything from you, no matter how poor you are. Statements like "If poor people knew how rich rich people are, there would be riots in the streets" are not only stupid but also dangerous.

Well, but it also does not mean that he didn't take anything from me. Generally, the US tax code is designed in such a way that capital begets capital. Put differently, if you make money passively from the money you already have, you pay a lower tax rate then if you haul brick on your back, or teach children. Is this taking? No, not directly, but indirectly, sure.

I would argue that the state is taking, not the rich (which are not the only people with money invested in the market).

Re: Economic Inequality: It’s Far Worse Than You Think

#23

Post by jplahn »

spuz wrote: post #15

Is it just me, or does the article contradict its own conclusion? > They asked about 55,000 people from 40 countries to estimate how much corporate CEOs and unskilled workers earned ... the patterns were the same for all subgroups, regardless of age, education, political affiliation, or opinion on inequality and pay > One likely reason for this is identified by a third study, ... that suggests that our indifference l…

I think the keyword is "indifference." While everybody miscalculates the CEO - unskilled pay ratio, the article is implying the indifference caused by "American cultural optimism" is what prevents us from changing it.

Re: Economic Inequality: It’s Far Worse Than You Think

#24

Post by brador »

sp332 wrote: post #21
brador wrote: post #7

Earlier quoted context omitted.

You honestly believe that people think "Don't tax the top because that's me (or will be)"? I suggest people believe their jobs and technological innovations we all enjoy are on the line if the rich are taxed more. If that is true or not is a separate conversation, but I don't think it's 39% of Americans think they will reach the 1%. That's absurd and the kind of thing you hear in mass media sound bites.

The most telling polling result from the 2000 election was from a Time magazine survey that asked people if they are in the top 1 percent of earners. Nineteen percent of Americans say they are in the richest 1 percent and a further 20 percent expect to be someday.

Time magazine readers are not an unbiased sample of America. Not even close.

Re: Economic Inequality: It’s Far Worse Than You Think

#26

Post by whybroke »

kokey wrote: post #5

I always feel a number of important metrics are left out, either by accident or on purpose, when people talk about inequality. Most importantly when it comes to wealth itself, by most measures there is a very, very long tail of people with no wealth. 'No wealth' ranges from the most poor, to those living from paycheck to paycheck all the way to those who have as much debt as their assets. Many of these people are fin…

>while the average worker can be anywhere in their career including eventually being a CEO one day

From the article:

> our indifference lies in a distinctly American cultural optimism. At the core of the American Dream is the belief that anyone who works hard can move up economically regardless of his or her social circumstances.

Aside from the factual error in the notion that there's more social mobility in the US than other countries, there is a difference between "anyone can become CEO" and "everyone will become CEO". If antebellum southern plantations had been structured such that one of the slaves might occasionally become the owner, it would not make it acceptable.

Re: Economic Inequality: It’s Far Worse Than You Think

#27

Post by proveanegative »

I think the popular conceptualization of economic inequality (effectively, "inequality is suffering") is misleading because it doesn't take marginal utility into account.

What I mean is, take the pizza-dividing example and suppose we have doubled the pizza. The inequality (expressed as the ratio of pizza owned to the available total) would stay the same but those with the smallest part of the divide would be noticeably less hungry than before.

In a world of plenty inequality would not mean suffering. More realistically, inequality would not mean (nearly as much) suffering in a world where a minimum slice of pizza was the birthright of a citizen.

Edit: This line of thinking is seriously flawed when applied to the real world. See drabiega's comment for why. metaphorm mentions some examples of where competitive costs may apply.

Re: Economic Inequality: It’s Far Worse Than You Think

#28

Post by sp332 »

blfr wrote: post #10
ghouse wrote: post #8

Earlier quoted context omitted.

There is about a 10x difference between the top 5% and top 1%. So, that's sorta far off. And then again a 20x difference between the top 1% and top 0.1%

Yeah but few people when asked think like that. It's just a type of "rich".

To consider yourself in the top 1%, you just have to be richer than 99 other people you know. Humans are not good at avoiding sampling bias.

Re: Economic Inequality: It’s Far Worse Than You Think

#29

Post by enoch_r »

Every time someone says "X people have a higher net worth than Y% of people COMBINED" I get very, very skeptical. Some net worths are negative. Some net worths are significantly negative. A homeless man has a much higher net worth than 8,000 people who just graduated from medical school with some debt combined. Relevant article.[1]

[1] http://blogs.reuters.com/felix-salmon/2014/04/04/stop-adding...

Re: Economic Inequality: It’s Far Worse Than You Think

#30

Post by nap »

ryandrake wrote: post #2

And, it's only going to get worse while [1] 39% of Americans either believe they are already among the top 1% or believe that they one day will be. If your mentality is one of "Don't tax the top because that's me (or will be)", you're going to constantly vote against your own economic self-interest, and continue to support policies that help the real rich get ultra-rich. 1. http://www.nytimes.com/2003/01/12/opinion/t…

There is an equality in possibilities, not in results. You can't blame anyone because you are bad in investments or can't do business. If you tax people who reach success, why not tax those who was failed? Let's redistribute bankruptcy, depression and suicides.
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