Myths of the 1 Percent: What’s Putting People at the Top
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Re: Myths of the 1 Percent: What’s Putting People at the Top
#2What I find interesting is that it is in the 'professions'.
I would have thought it was massively wealthy equity owners/holders, hedge fund managers etc..
But yes - if we are paying doctors $1M/year then this will happen.
At a nearby hospital in Canada, technology improvements have allowed doctors to diagnose using x-rays a lot faster ... but the Unions have kept pay scale the same. The doctor at the Orangevill hospital earns over a million dollars a year, and he works from home. Swipe, swipe, swipe, swipe - done.
Faster tech = more money for the doctor. Savings not passed on to taxpayers.
Innovators thought they were improving healthcare, but they really were throwing more surpluses onto the value chain, to be captured by those with the most power: doctors, possibly drug companies.
One would think a private system would be more efficient ... but it's probably just as bad in the US.
Re: Myths of the 1 Percent: What’s Putting People at the Top
#3>Almost all of the growth in top American earners has come from just three economic sectors: professional services, finance and insurance, and health care, groups that tend to benefit from regulatory barriers that shelter them from competition.
>The groups that have contributed the most people to the 1 percent since 1980 are: physicians; executives, managers, sales supervisors, and analysts working in the financial sectors; and professional and legal service industry executives, managers, lawyers, consultants and sales representatives.
Not a surprising result at all when you consider that the bottom of the top 1% has an income of high 6 figures to somewhat above $1M. That number is something very achievable for the most successful "professionals" -- doctors, lawyers, bankers (not HF managers), traders, and there are a lot of these people out there!
It's a natural consequence that if you look for a large number of people earning $1M, you'll end up with highly successful "professionals" rather than outlier level wealth from business ownership, which is much more rare.
Re: Myths of the 1 Percent: What’s Putting People at the Top
#4>Almost all of the growth in top American earners has come from just three economic sectors: professional services, finance and insurance, and health care, groups that tend to benefit from regulatory barriers that shelter them from competition. >The groups that have contributed the most people to the 1 percent since 1980 are: physicians; executives, managers, sales supervisors, and analysts working in the financial s…
Im very confident the author knew this and thought this little shell game would make his calls for deregulation look convincing.
Re: Myths of the 1 Percent: What’s Putting People at the Top
#5This is such an interesting article, attempting to answer one of the biggest questions of the 21st century in one fell swoop. However, I'm not sure all of the reasoning and analysis holds up. For example, software engineers with salaries over 390K are far from rare in the US, and Switzerland has both large numbers of bankers per capita and private doctors with incredibly high incomes.
Re: Myths of the 1 Percent: What’s Putting People at the Top
#6>Almost all of the growth in top American earners has come from just three economic sectors: professional services, finance and insurance, and health care, groups that tend to benefit from regulatory barriers that shelter them from competition. >The groups that have contributed the most people to the 1 percent since 1980 are: physicians; executives, managers, sales supervisors, and analysts working in the financial s…
*> business ownership, which is much more rare.
First, you're assuming that all these "professionals" are not also business owners, which is often false; doctors and lawyers earning enough to put them in the top 1% are most likely owners of or partners in a private practice.
Second, if we restrict "business ownership" to those who are not "professionals", the fact that it is rare is a consequence of regulation, not an independent fact. Regulatory barriers don't just benefit "professionals" who have the requisite qualifications; they also hamstring people trying to start businesses not in those particular "professional" sectors.
So the result is only "not surprising" if you take the level of regulation we have now for granted.
Re: Myths of the 1 Percent: What’s Putting People at the Top
#7>Almost all of the growth in top American earners has come from just three economic sectors: professional services, finance and insurance, and health care, groups that tend to benefit from regulatory barriers that shelter them from competition. >The groups that have contributed the most people to the 1 percent since 1980 are: physicians; executives, managers, sales supervisors, and analysts working in the financial s…
Im very confident the author knew this and thought this little shell game would make his calls for deregulation look convincing.
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Re: Myths of the 1 Percent: What’s Putting People at the Top
#8What I find interesting is that it is in the 'professions'. I would have thought it was massively wealthy equity owners/holders, hedge fund managers etc.. But yes - if we are paying doctors $1M/year then this will happen. At a nearby hospital in Canada, technology improvements have allowed doctors to diagnose using x-rays a lot faster ... but the Unions have kept pay scale the same. The doctor at the Orangevill hospi…
> One would think a private system would be more efficient ... but it's probably just as bad in the US.
The US health care system is not a "private system". It's a mishmash of private and public which combines the worst features of both. The reason we have it in the US is that during WW II, the government controlled wages, so businesses trying to compete for employees had to offer something else as an incentive, and they mainly picked health care benefits. Then, when the war was over and the government stopped controlling wages, instead of going back to competing on wages and dropping employer-provided health benefits, the system of employer-provided health benefits kept on growing. Which now meant it had to be regulated by the government, and so on, and so on...
Re: Myths of the 1 Percent: What’s Putting People at the Top
#9It's interesting what words are not in the article. Words like heir, inheritance, profit, interest, rentier. The word rent is there, but assumed as a tenant, not landlord.
I assume the Forbes 400 richest are in the 1%. How did the Koch brothers get their $100 billion? Where did the Waltons get their $140 billion? Where did the Mars family get their $75 billion? The article makes it sound like these people became rich when they decided whether or not to go to law school.
It's important to note how in the US how FIRE (Finance, Insurance, Real Estate) and health care affect the economy. But a lot of what puts people at the top is at which hospital they took their first breath.
Re: Myths of the 1 Percent: What’s Putting People at the Top
#10Few things are sadder than seeing Britain and China post equal "gains" for the 1 percent.