Rich people do have trouble understanding what it's like to be poor • Hacker News Board

Re: Rich people do have trouble understanding what it's like to be poor

#91

Post by sidlls » Sat, May 22, 2021, 2:29 PM UTC

Consultant32452 wrote: post #11

I think this suffers from a causation direction bias. Maybe people with the choice mindset wind up in positions of wealth and power because of this mindset. I can only speak anecdotally, but the hand full of millionaires I know all grew up lower middle class, and they all have choice mindset. I think the worst kinds of people create a false dichotomy here where either everything is choice or everything is a product o…

> think the worst kinds of people create a false dichotomy here where either everything is choice or everything is a product of externalities.

> But within their context they are likely to have better outcomes than people who externalize credit/blame.

I think you're interpreting "choice mindset" in the context of this article differently from how it's meant.

Poor people understand very well what it means to have to make choices. They know quite well that their choices impact their lives, and how. That's part of the psychological violence the poor experience, in fact: their choices are often of the form "which harm do I visit on my family this week?" Your comment about the false dichotomy captures it, partially: the wealthy imposing/projecting their view that every condition is the result of a choice made by the individual. Poor people generally don't believe their entire lives are a product of externalities, but the rich certainly do believe it's all about choices.

Re: Rich people do have trouble understanding what it's like to be poor

#92

Post by ta988 » Sat, May 22, 2021, 2:31 PM UTC

eplanit wrote: post #88

nanis wrote: post #36

Wealth is a stock measure, income is flow. You accumulate wealth out of what you can set aside out of the flow. Some of us immigrants do not come to this country with an existing stock of wealth either back home or here. We are also not in the favored group of immigrants. We have human capital which we are trying to convert to financial capital for the next generation. Then, when we sort of "make it" here, people who…

I'm genuinely curious why you chose the USA to migrate to. Would you have been better off in the EU or Asia?

In EU, highly unlikely unless you go to Switzerland (which is not really EU but surrounded by EU).

Re: Rich people do have trouble understanding what it's like to be poor

#93

Post by hnfong » Sat, May 22, 2021, 2:32 PM UTC

gruez wrote: post #85

throwaway3699 wrote: post #61

Earlier quoted context omitted.

Children are not a luxury product like a sports car or yacht. They are a basic function of human life.

All the kid free couples out there beg to differ.

It may be optional for individuals, but as a society, if a significant portion of people cannot afford to have children, that society will go "extinct" very quickly.

Re: Rich people do have trouble understanding what it's like to be poor

#94

Post by lotsofpulp » Sat, May 22, 2021, 2:33 PM UTC

azornathogron wrote: post #79

lotsofpulp wrote: post #42

Earlier quoted context omitted.

When currency is being devalued year after year, lost income (up to a certain amount) most certainly is an expense. The longer you sit out of the asset inflation game, the more you fall behind. So whatever the cause for you falling behind has to make up for it. Maybe I’m wrong, but that model has served me well.

I agree that currency devaluation and so on means that saving money earlier in life has a larger impact on your lifetime comfort than saving money later. I don't really follow how it's classed as an expense though. And I don't know how you determine how much income you have "lost". I think we probably agree on the situation but disagree on what terms make sense to describe it.

Assuming you need $x by some age due to being unable to earn more money (illness, old age, not wanting to work), then not earning income in your possible working years pushes up the amount of income needed in other working years to reach the same $x.

For example, if you get your bachelors in 3 years instead of 4 and spend $30k on tuition and earn $90k by working, then that would result in an extra $120k in compared to spending 4 years in college.

I class it as an expense, because everything has an opportunity cost, which is defined as your 2nd best option. It is not always useful, for example thinking about spending time with your kids rather earning $15 driving for uber or something. But it could be, if you need that $15 to feed your kids.

Re: Rich people do have trouble understanding what it's like to be poor

#95

Post by chii » Sat, May 22, 2021, 2:33 PM UTC

fnord77 wrote: post #20

aspaviento wrote: post #5

Earlier quoted context omitted.

I remember a politician complaining about having difficulties with a salary of 6000€/mo. Some people live in a bubble so far from the real world that almost seems fantasy.

a national politician needs two homes - one in the capital and one in the location they represent. That alone would eat up 6000€ especially if either place is expensive.

why do they need to own the place in the capital, if they only travel there to work? Can't they rent for the duration of the time they spend there?

Re: Rich people do have trouble understanding what it's like to be poor

#96

Post by avianlyric » Sat, May 22, 2021, 2:33 PM UTC

mynameishere wrote: post #62

elliekelly wrote: post #12

Earlier quoted context omitted.

I thought this for the longest time. An embarrassingly long time. Then I volunteered with a program that helps people who qualify for EITC to prepare their taxes and budget how they’ll use their tax return to “get them out of their situation”. Person after person came in, we did their taxes, and then we went over their expenses and each case was a frustrating puzzle that was impossible to solve. There just wasn’t eno…

Okay...but on /r/personalfinance, people show up all the time with a litany of complaints and a litany of awful, awful budget mistakes they have no interest in fixing. 120/month cellphone, 400/month doordash, Dodge Charger with a 600/month note. And so on. each case was a frustrating puzzle What puzzled you? The necessities should never be a puzzle. If the rent, the food, the utilities, the insurance, and the day car…

And what if they already have a second and third job, have already started cutting back necessities.

What do they do then? Starve?

Re: Rich people do have trouble understanding what it's like to be poor

#97

Post by an_opabinia » Sat, May 22, 2021, 2:34 PM UTC

fortran77 wrote: post #68

hn_throwaway_99 wrote: post #65

Earlier quoted context omitted.

I think this is an excellent comment. What makes me very sad is that during the past 14 months the divide between those who own assets and those who don't has reached gargantuan proportions. I mean, in my raging inferno of a housing market, over the past couple of years home prices have easily doubled. So a 400k house from 2018 now sells for 800k. Yes, if I want to move to another house in my area I'll pay similarly…

Taxes even that out a bit. The person with an 800k house pays twice as much in property taxes. In many states, the amount that the state can raise taxes on someone whose house may have "increased" in value is limited.

You have a lot of reading to do about property taxes in California.

Re: Rich people do have trouble understanding what it's like to be poor

#98

Post by ddingus » Sat, May 22, 2021, 2:36 PM UTC

andyana wrote: post #37

danaris wrote: post #31

Earlier quoted context omitted.

> Obviously, you can't undestant what you do not experience yourself Sure you can. That's what imagination and empathy are for. I've never been truly poor myself (though I did grow up what I would term lower-middle-class), but I can understand it, because I've read about it, I know the basic concepts of what the differences are between my situation and that situation, and I'm good at putting myself in someone else's…

No, you can try to understand, but you have no way of knowing how it really is. As a male, I can try to understand pregnancy. There is no amount of learning that would beat the experience of a mother.

I grew up poverty myself. While I do not entirely disagree with you, poverty is an experience available to all of us.

Women have pregnancy to themselves.

That does blunt your point some.

I also believe people can come to understand well enough to matter when they seek that understanding.

The raw nature of it may remain elusive, the part of your point I consider strong, but what it means is a different, shareable thing.

And I have shared it to great effect. Many have.

In my view, one of the most important things struggling people can do is share their stories. That does add up. Others can feel something of it and can reason better about it.

A national dialog of this kind is missing and too many of us need what a dialog like that can mean.

Re: Rich people do have trouble understanding what it's like to be poor

#99

Post by renewiltord » Sat, May 22, 2021, 2:37 PM UTC

hn8788 wrote: post #57

I had a co-worker who thought he had a typical american childhood because he didn't consider his family wealthy, even though they had millions of dollars of networth over 30 years ago. Him and his 3 bothers went to a very exclusive private school that was 50k a year per child, but since his classmates were mostly "old money" that were from family worth 10s to 100s of millions of dollars, he was picked on for being th…

Fast food gives me the runs too and I don’t have that association. McDonalds, Taco Bell, Chic Fil A. I can eat at Super Duper just fine, though.

Doctors aren’t infallible.

Re: Rich people do have trouble understanding what it's like to be poor

#100

Post by skeeter2020 » Sat, May 22, 2021, 2:38 PM UTC

fortran77 wrote: post #68

hn_throwaway_99 wrote: post #65

Earlier quoted context omitted.

I think this is an excellent comment. What makes me very sad is that during the past 14 months the divide between those who own assets and those who don't has reached gargantuan proportions. I mean, in my raging inferno of a housing market, over the past couple of years home prices have easily doubled. So a 400k house from 2018 now sells for 800k. Yes, if I want to move to another house in my area I'll pay similarly…

Taxes even that out a bit. The person with an 800k house pays twice as much in property taxes. In many states, the amount that the state can raise taxes on someone whose house may have "increased" in value is limited.

That's rarely true. Property taxes are typically set by dividing the budget by the total value of all real estate to set the mill rate and then allocating it by the specific value of your property, so if the entire market increases the tax impact based on assessed value doesn't change much. You only see dramatic changes when certain areas in a taxed area increase or decrease significantly relative to others.