Yesterday morning I listened to “The Young Turks” for a few depressing but enlightening minutes. On the program, they were discussing the expansive UN study that demonstrated the income disparities around the world. What particularly blew them away was the news that if you have $500,000 in assets, you are in the richest 1% of the world. They couldn’t believe that was all it took. And I couldn’t believe that they couldn’t believe that, in global terms, having half a million is assets makes a person unbelievably rich. Hell, if I had half a million in assets, I’d feel like a pig at the trough. But what was so disturbing is that liberal talk show hosts, who should be up on these issues, were so damn surprised at how much the wealthy of the world hoarde the world’s assets. (More on the world situation from Echidne, since the rest of this post is mostly about the internal U.S. situation, since the larger situation is way outside anything I have the chops to address in a post._
Not that I’m blaming them. Income disparity is a topic that’s fallen somewhat off the radar for both liberals and conservatives, and has for a long time now. Sure, pundits on the right bitch and moan about “class warfare”, their perverse twisting of a term that describes the relentless attempts by capitalist fat cats to slash labor costs into a term that implies that even the hint that the rich should give back to the society that gives them so much is “war”, but the truth of that matter is that the discussion of actually addressing income disparity, even in the United States where we have a good deal of control, has become taboo. Liberals agitate, with restraint, for minor fixes to relieve the woes of those on the bottom with minimum wage raises, health care reform suggestions, and other minor fixes to relieve poverty. But rarely do I see anyone point out some obvious historical facts, such as the fact that in 1950s, this country had marginal tax rates of 91%, but now it’s at 35%. These things are so rarely discussed that it’s no wonder that even liberals don’t know how successful a job conservatives have done since the 60s of growing the gap between the rich and the poor.
It’s this blanket of silence of the issue that is the background to Neil Cavuto acting like Paul Krugman farted in his face when Krugman came on Fox News to discuss his article in the Rolling Stone about how the super-rich are destroying America. (Via.) Actually, Cavuto, when presented with the facts that his news channel does so much to distract and hide people from, just accused Krugman of lying to him.
CAVUTO: Here’s what I’m saying that you’re doing: You are lying to people. That’s what I think that you’re doing.
KRUGMAN: I haven’t heard a lie yet. But, look, if that’s the way you want to do it, I mean, fair and balanced, go all the way. Look, c’mon, the fact of the matter is–
CAVUTO: No, no, you don’t have to be snide. You have to be factual.
KRUGMAN: You’re being snide.
CAVUTO: No, no, you’re mentioning good data. You’re saying there’s a growing divide between the haves and have nots. Others have argued that very effectively and very eloquently, just like you. All I’m saying is that the math that applied now, can’t you apply it in other periods, when there have been Democratic presidents who’ve had the same dislocations? You’re saying that it’s somehow dramatically worse now than it was 10 years ago, 20 years ago?
KRUGMAN: Yeah, actually, it is dramatically worse now than it was 10 years, 20 years ago. All of the measures of inequalities have just gone off the charts. It didn’t start with Bush — and I actually say that if anybody, you know, buy Rolling Stone, read the article — it actually starts even before Reagan, so this is not just Bush. The point of the matter is that, when, in these last five years, as it’s becomes clear that this is a really growing problem, that most people are not sharing in the economy’s growth, the policies of Bush have been at every point to push that inequality further.
Think Progress included a chart to demonstrate how accurate Krugman’s assertions are.
Compare that to the tax rate and you see exactly why the Republican yappers have such a bug up their butt about taxes. In fact, the correlation between marginal tax rates and income parity is such that, if you’re kind of simplistic, it’s tempting to wonder if the government isn’t just taxing the very rich and handing it out. In fact, it’s that misunderstanding that Cavuto and his crew are trying to bolster.
I just started Don’t Think, Smile! at the recommendation of Chris Clarke and Michael Bérubé, and in the first essay right off the bat, Ellen Willis discusses just this blanket of silence.* A lot of socialists point out that the New Deal was really a way for the capitalist structure to preserve itself from any kind of socialist insurgency that might have resulted from the Great Depression, and this is true, but Willis takes it a step further and reminds the audience that the megagrowth of the middle class and prosperity for ordinary Americans in the 50s and 60s was a continuation of this. As she puts it, the tumult of the recent decades was such that the capitalist class had to buy your everyday American’s loyalty to the system and they way they did this was to levy enormous taxes and spread the wealth around, which worked like a charm. But it’s not just that Americans buy into the system that allows conservatives to keep growing the income gap without much of a peep of protest. It’s also a historical forgetfulness. The anti-tax ideologues that work for George Bush and run the right wing punditry are generally a generation or more removed from the nightmares that were caused by unchecked capitalism in the first half of the 20th century. In a weird way, I feel them, because it all does seem impossible from a distance. But I dread the price that people will be paying if historical lessons go stubbornly unlearned.
*The entire essay is actually more about another elephant in the room that I leave basically unaddressed in this post, which is the fact that all these national politics are probably moot, anyway, because the world is actually being run now by transnational corporations. The war in Iraq is a good example of how Willis’ predictions are coming true—the American military has been basically commandeered by corporate interests to dismantle a nation-state that was getting in the way of certain assets that they’d like to have control over.
57 Responses to “Krugman points to the elephant standing in the middle of the room”
Leave a comment
Line and paragraph breaks automatic, e-mail address never displayed, HTML allowed: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>
$500,000.00 equals one three bedroom house in middle class northern NJ. It’s a lot of money in some places in the world, not here. Look at what it costs to buy a middle class apartment in NY. That just covers a place to live. Lots of people with $500K in assets are just hard working middle class guys and gals with union, blue collar, etc. jobs.
Income disparity may be a “problem” (of course, not everything that is a “problem” calls for a gov’t “solution”), but that number doesn’t tell you much.
I’m more concerned about CEO’s making $25M (or more) while employees are cut back, or lose bene’s. That seems like an issue worth talking about.
A three bedroom house used to be an everyday luxury in America. Now it’s unfathomable to a huge percentage of the population.
A conservative is someone who will do gladly do anything for his country, except pay his taxes, the sine qua non nationhood.
The wacko anti-tax rebels we heard about in the 1960’s, who had a variety of imaginative rationales for believing that not paying your taxes was the epitome of patriotism, have taken over the Republican party. I think this idea of not giving back (a socialist ideal) to your country has become the heart and soul of the modern Republican party.
Note that Bush signs a bill allowing Federal funding for fetal stem cell research and we hear nary a peep from the Republican faithful, but taxes: this they won’t forgive.
Did you see the interview by Ben Stein of Warren Buffett in last Sunday’s NYT Business Section? He said we are engaged in class warfare, and his side (the rich) were winning.
Amanda, you start off talking about assets and wealth, but then move into income inequality. They’re definitely related, but also distinct concepts and measures, and I don’t think you really make that clear. On my income, I couldn’t afford the root canal my dentist thought I’d need (so far, don’t need it, but still might). Without any assets, that root canal (yes, something that small) could devastate me financially for a while. If I had any kind of wealth, I would be much less affected by it. (It would also be nice if I had dental insurance, but student medical insurance doesn’t cover it, and working as an adjunct–a nice exploitable academic temp–I’m benefits ineligible.)
In talking about issues of inequality, it’s important to keep in mind the distinction, and the effects of that distinction.
Libertarian -
I don’t know if a $500,000 house can be considered an asset unless you own it free and clear (after paying off your mortgage). Otherwise, you’re just borrowing it from the bank.
I think of assets as your back accounts, retirement accounts, and material possessions. Amassing $500,000 in those terms is more of a challenge.
mr. memento,
In the case you note, if the bank still owns it not only are you borrowing it from the bank, you have debt, a negative asset.
MAJeff Dec 7th, 2006 at 9:28 am
That’s only true if the house is worth less than is owed on it. If the house is worth more than is owed on it, you have a net positive asset value.
raj…good point.
BTW, the post is definitely confusing income and net worth (the latter being “wealth”). The disparity is interesting and to some extent disspiriting, but I’ll merely note that, if someone in the US graduates from college with a relatively large college loan debt, he or she may actually have a negative net worth for at least a few years. But, if his or her income prospects are relatively good, that negative net worth can be relatively quickly wiped out, and he or she can quickly amass assets giving him or her a positive net worth.
The real elephant in the room is that the only media voices we hear in the national discussion of income disparity are those of the relatively privileged. (Yes, even Paul Krugman, who is on the side of the angels.)
This is why we hear “liberal” think tank scholars publicly advocate for corporatist measures like higher insurance co-pays to deal with the rising costs of healthcare. (Spoken like someone who has never had to make the choice between groceries and antibiotics for your baby’s ear infection.)
As long as the Democratic party continues to solicit policy input only from those to whom poverty is only a theoretical issue, the more removed they become.
What do you expect from the Air America equivalent to ESPN’s Cold Pizza. Has been corporate rock exec thinks he can lure college age listeners in with a show named after a Rod Stewart video MTV overplayed back when Nina Blackwood was drawing few advertising dollars.
Just kidding. Everybody knows the program was named in tribute to the power hungry liberals responsible for the Armenian Genocide.
In fact, if that $500,000 house used to be worth $600,000, by owning it you might be in the hole by “owning” it.
MAJeff’s point is a crucial one. Income disparity (especially when you don’t have a lot of taxes and there’s no estate tax) is how you get wealth disparity, but in a lot of ways it’s wealth disparity that counts. Wealth disparity is what lets people make investments in themselves — college tuition, professional education, low-paid or unpaid internships at prestigious organizations — without going deep into debt and constraining all the rest of their life’s choices. It’s what lets them weather a few months or a few years of finding a new job that fits their skills and desires, and insulates them against many of the effects of illness and accident.
In more civilized countries there’s also the notion of the wealth you can tap into simply by being a member of that society — free or low-cost education and housing, medical care, disability and retirement pensions. That reduces the effect of disparities in personal wealth. (Which means that the effect of the numbers Krugman cites in the US is even worse than it might appear.)
And the amazing thing in the US is the way all of this has been normalized, so that many of the people on the bottom of the ladder would be among the first to defend the proerogatives of the people at the top. That’s one big difference between the situation now and at the beginning of last century.
This is interesting and topical given the fact that this morning I heard an article on Morning Edition on NPR as I was getting ready (to step out to 9 F, and that’s without the windchill) where they talked about “low cost alternative gift options for children” as this amazing thought … I started thinking “who REASONABLY expects to get a PS3 for an xmas gift? I mean, SERIOUSLY?”
And the talk in the commuter-newspaper (the “don’t think, don’t be challenged, not requiring actual brain function” rag where the front cover article was on the hypothetical breakup between Vince Vaughan and Jennifer Anniston and a letter from a reader decrying that Brian Urlacher didn’t get “sexiest chicago sports figure” got back page column inches) has recently been about how to ‘manage your xmas gift debt’ … it’s just assumed you’re going into debt, or suggests when it might be okay to not give everyone in a friend’s family a gift individually.
Huh? Am I missing something here? I am agreeing with MAJeff here that while Amanda’s points were excellent, and bringing up this issues is highly needed (elephant very much indeed) her equation of different measures needs a little work.
Oh, and its interesting you bring up dental Jeff, as I technically have dental insurance coverage as part of my graduate student health insurance package. The reality is that it is atrocious. I’m simply not using it, because chances are I would end up with a HUGE bill (huge relative to my student income) that would cripple me financially, literally. Unless I have some major issues, I’ll stick to flossing, listerine, and twice daily brushing. Once I actually finish my PhD and am earning, THEN I can let a dentist go deep fissure mining, but until then, you gotta make those trade-offs.
I would not live in this country if I did not have even the meagre health insurance I do, and honestly, one of the reasons I am not staying here after study is because the pathetic health care system here (”best in the world” my arse) … I once had to take public transportation across town after being attacked by a dog, bleeding, because to not go to my university’s hospital would have resulted in a huge bill.
I think some of these numbers can be fairly meaningless if you’re not factoring in local costs-of-living. A US family with two minimum-wage income earners will pull in around $30K gross under the proposed minimum wage increase. It’s hard for me to imagine how an American household with kids could get by on that, let alone on the current minimum wage which would put that household at roughly $21K. But you could live high-on-the-hog in India, Thailand, etc. on $30K.
mr. m
Lot’s of middle age (40 to 50) people here bought houses 15 years ago, with 15 year mortgages. Unless, they re-fied, they now own those houses (which they may have paid $125K to $200K for) free and clear. We were in that position, until the college costs for our girls kicked in.
Those people, despite owning a $500K asset (and maybe they have a couple hundred thou in mutuals, 401k’s etc), largely still work two jobs (one each or more), and work to pay ongoing expenses, college, vacation, put some away to retire some day, and aren’t “rich” by any stretch of the imagination.
Oh, listen to the violins.
I wish I had the problem of owning a $500K asset. Or even $50K. Or even $5K.
Libertarian, I’m shocked that I actually agree with you on something…
Pandagon truly has the power to bring people together (at least for a while)…
The surprisingly quality of US taxes is that we essentially have a flat tax already. The so-called payroll tax is a regressive income tax, as are capital gains, dividends, and estate taxes. Together with wealth (property) and sales taxes, along with income tax deducations, they even out the progressive IRS income tax.
See here for a graph: http://www.discourse.net/archives/pix/flat-tax.html
Own Home … Education … Vacation … Retirement Funds
Considering the figure was the richest 1% in the WORLD, I don’t need to stretch my imagination at all.
Kinda brings home how rich a country the US is, even for its disastrous faults.
And the amazing thing in the US is the way all of this has been normalized, so that many of the people on the bottom of the ladder would be among the first to defend the proerogatives of the people at the top. That’s one big difference between the situation now and at the beginning of last century.
That’s because we’re still being spoonfed the “American dream” myth of class mobility. In his article in Rolling Stone, Krugman calls it a myth, and notes that there’s greater class mobility in the UK, which is generally seen as extremely class static, than there is in the US.
Ah…good old Patriarch Verlch. You know how he loves to tell women they must learn to submit because the Bible says so…and you have to take the whole Bible literally? Well, he has a new theory. Adam did not eat of the fruit willingly and is therefore in no way responsible for sin and death entering the world. What really happened is that Eve took the fruit and mixed it with other fruit and “tricked” him. You know how devious we women are! This is in NO way even hinted at in the Bible…forget about taking things out of context…he’s just going to rewrite the whole thing to suit himself!
There is a difference beween income and wealth, so in that regard, this chart is tangental.
However, the is evidence that INCOME disparity is worse now than previously, and Krugman was, as usual, correct while Cavuto, as usual, was blowing smoke from his ass. See here:
http://angrybear.blogspot.com/2006/12/income-inequality-some-evidence-for.html
Exactly!
Those who benefit from this ‘glowing economy’ are just three.
Capital gainers…various sorts
Landlords (rentors).
Share-holders (dividend clippers).
Thay all LOVE the GDP…because it’s reallygood for them.
But is not… for the vast majority of us.
Scientific American…while back..had a piece on this and ended
recommending what they called the ISEW.
Index of Sustainable Economic Welfare which, while also bringing
environmental benefits, better reflects how the WAY most of us are doing.
Made sense to me…for that all that I’m pretty fervent socialist/’regulationist’….
By no means an economist.
[Andrew Leonard in Salon really likes Nobel winner Stiglitz for that role]
WTF! Have you not been reading what people are saying? No one is asking you to feel sorry for people with assets like these. The point is that local cost of living is important. A $500,000 house in north Jersey is a $150,000 house in Iowa. The differences are even greater when you look on a global scale. Take Egypt, for example. A luxury three bedroom apartment in Zamalek (one of Cairo’s weathiest neighborhoods) can be had for well under $50,000 (I’m not missing a zero there, 1,500,000 pounds Egyptian, 3.35 pounds to the dollar - and that was one of the most expensive on the page http://www.e-dar.com/cgi-bin/newedar/newedarasp.pl).
People with apartments like this in Cairo are much “richer” than most owners of $500,000 houses in north Jersey (they’d be more comparable to people with 3 bedroom apartments on the upper east side of New York). But, according to raw measures of assets they don’t qualify as wealthy because assets in their country are worth so much less in the global marketplace.
Now, there are other factors to consider. If an earthquake were to hit Cairo, people in buildings like these would be more likely to be killed than people living in housing projects in major U.S. cities. While the basic necessities - food, clothing and shelter - are much cheaper in third world countries luxury products like cars and computers are much more expensive.
The point is, in determining who is “richest” you need to take into consideration what people’s money can buy where they are.
You know, that’s one of the reasons that my husband says he came here. Because we sell that myth like crazy to the rest of the world (and also here at home)–that we are the most free and most economically mobile society on the planet. He was very disappointed that it isn’t atually true. We don’t actually do all that badly (i.e., we can pay our bills and have the occasional fun evening out), as we’re both educated and have jobs, but it does suck. In fact, his theory is that, because of the economic disparity and the religious fundamentalism running rampant these days, there will be some sort of uprising and ‘blood in the streets’ in the next 50 years. I really, really hope he’s wrong and that our problems can be fixed more peacefully, but I somehow think he’s right in this.
well under $50,000 (I’m not missing a zero there, 1,500,000 pounds Egyptian, 3.35 pounds to the dollar
You in fact do appear to be missing a zero somewhere - 1,500,000 (one million, five hundred thousand) divided by 3.35 is about 447,000 (four hundred and forty-seven thousand).
Kate: Thank you! I’ve been saying exactly that kind of thing for years, especially when (stupid) people feel compelled to “translate” my salary into US dollars in order to “understand” it. No, I don’t make the equivalent of my salary minus the exchange rate; if I spend Canadian dollars here at home, they go roughly as far as US dollars spent in the US, and farther than some people’s US dollars spent some places in the US. I also get really mad at those cheapjack “99% of the world lives on $2 a day or less” melodrama appeals. Okay, asshole, now tell me how much you can buy with $2 US a day in a lot of the world…
Personally, I have a negative net worth. I’m also awfully tired of the economically-advantaged just assuming in my direction that if I need money, I can find it, because sometimes, I can’t. If I didn’t have wealthy parents who are occasionally willing to pull my rear out of the fire once in a while, I’d be totally screwed. (At least I know that, and I’m not going around braying about how “self-made” I am. Heh.)
Actually, the largest increase in inequality has been in pre-tax income. Post-tax income inequality has increased more slowly, because at least before Bush took office, there was a steady trend of closing tax loopholes.
The lion’s share of the increase in inequality in the US comes not from tax rates - after all, income inequality kept increasing in the 1990s even though Clinton raised taxes on the rich - but from the fact that CEO pay has exploded while wages at the bottom and in the middle stagnate. The most relevant statistic here, median household income, is calculated pre-tax, and did not increase between 1990 and 2003 (more precisely, it stagnated in the early 1990s, increased in the late 1990s, and fell again in the early 2000s).
I don’t know what “liberals” means, since single-payer health care is far from a minor fix, and raising the minimum wage even to $7.25 will exert upward pressure on wages close to the bottom. Personally I’d be more comfortable with incrementally raising the minimum wage to about $10.00 in 2006 dollars, guaranteeing a minimum income at the poverty level with no preconditions but a simple means test, seizing control of education spending from school districts and distributing money on an equal per-student basis instead, and capping military spending at 2% of GDP. And I’m fairly certain that if you polled the 21% of Americans who identify as liberal, you’d mostly get agreement with that platform.
Purchasing power, yes, purchasing power. That is the issue.
Also, this says nothing about entitlements and how they play into the relative wealth equation. A lot of Brits and Swedes don’t own houses, but they also are not expected to completely drain their house equity to educate their children if they do, or to be able to afford food when they are 75.
Even Brazillians get some form of socialized health care. As do Cubans are most certainly impoverished, but if they do well in school they are educated and everybody has free access to whatever health care the country can manage.
Actually, it’s usually factored in. Not that many people live on the PPP equivalent of $2/day - if I remember correctly, what is called the $2/day level is actually equivalent to $1,500 a year. Which, if you ask me, is still obscene.
Why Krugman had to compare the US to the one country in the first world that has a lower level of income mobility, I don’t know. Personally, I’m happy with “The US has an intergenerational income regression coefficient of 0.47; Sweden is at 0.27, Canada is at 0.19, and Denmark is at 0.15.” Incidentally, the fact that Canada is mobile suggests that you don’t have to have massive government spending to have a mobile society, since Canada has a smaller government than every European country I know of, counting both the federal and provincial levels.
I heard a synopsis of this story on the radio, and one of the facts given was that if you divided the world’s wealth evenly among everybody alive today, everybody would have $25,000. Um, how did they come up with that? I mean, did they include the Catholic Church, real estate, adults only, what?
That’s the last time I comment before my coffee. But, the point is that there are major cost of living differences in different regions of the world. An income that would be poverty level in New York can be quite comfortable in less expensive parts of the U.S. and even more comfortable in less expensive countries. Now, there are major reasons why those areas are less expensive - political instablity, poor heath care infrastructure, etc. etc. People in wealthier areas can choose to up their standard of living my moving to a cheaper area - people in poorer areas don’t have that option.
But, trying to make americans with a modest home, and a little money saved for retirement feel guilty because they have so much - that’s what sends them to the Republicans. Plumbers and pastry chefs who manage to save up for three bedroom homes in the suburbs really aren’t the problem, in the U.S. or globally.
put some away to retire some day
This comparison isn’t meant to imply that people who can’t afford to have a cavity filled but can afford to feed themselves should be content with their lot, or that dental care is a luxury item. It’s meant to illustrate the depth of the disparity–ludicrous enough that this country’s economy is set up to include our conventional definition of poor, but a whole order of magnitude more shameful that there are people as distant from antibiotics as a middle-class American is from a personal jet.
Class mobility is not dead; it is just hard, and going back to being harder.
My maternal grandparents both grew up on the bottom of the economic scale. My paternal great-grandparents, ditto.
My oldest brother and I both own homes/property and have income nudging us towards that $500K in assets. My sister and youngest brother, not so much. But neither is worrying about eating and keeping a roof overhead.
Cost of living absolutely needs to be taken into account. Most of my “wealth” is tied up in the MA house, which has doubled in value since we bought it a decade ago. If we sold it to get the money out, we would have to spend an equivalent to find the same unless we were willing to relocate. How then is it really more wealth than that $150K house in Iowa? Other than being available for a home equity line that would put us into debt, of course.
Class mobility and economic security are largely trade-offs for one another. If you want to have a secure job and all that, fine, but it’s unlikely that the economic system providing the secure job will simultaneously provide you with upwards mobility. If you want mobility, you must bear risk.
The story of income inequality is the story of the growing disparity in the psychology of wealth for individual Americans.
I’m not clear on how this purchasing power thing changes the the fact that people with $500k in assets are in the top 1% globally, even if they’re only middle class locally. Libertarian may not “imagine” him/herself as rich, probably doesn’t feel rich living among the world’s richest, but that doesn’t change the fact that compared to the rest of the world, s/he is very, very rich.
And isn’t the fact that 1-percenters don’t understand themselves as rich precisely the problem Amanda discusses at the beginning of her post?
What am I missing here?
The point is, in determining who is “richest� you need to take into consideration what people’s money can buy where they are.
I agree completely, Kate. I was trying to make the point — badly, it seems, and out of context — that owning a home, paying college tuition, saving for retirement, and having vacation time are all luxuries, and that these things, not the literal amount of money or assets you have, are what make you “rich.”
But let’s pretend I never said anything.
Uh, no. In Sweden, employers are by and large not allowed to fire workers, and I suspect that Denmark and Norway aren’t that different. See my above comment for levels of class mobility in these countries versus in the US (Norway’s at 0.17, I should add).
Elsewhere, there are discussions about dreams for a better America. I don’t know about that, but I have a dream of a better blogosphere, where people who make factual claims have to back them up.
The story of income inequality is the story of the growing disparity in the psychology of wealth for individual Americans.
Instead of What Color is Your Parachute, what we have here is What Color Is Your Kool-Aid!
Because whatever it is you are drinking, it is making you hallucinate if that is what you think. You want fries with it?
Much easier to have that “Psycosis of Wealth” or whatever when you don’t have to join the military to have even a hope of going to college, or take on enormous debt, or have no access or entre to the kinds of things you need to get capital for a small business, etc.
So easy for white male middle and upper class types to speculate about - so hard for the true realities of starting behind the curve and being held there by increasingly regressive politics.
I think one of the things that gets overlooked about people who own a $500,000 house, but don’t seem rich, is that they’re just kind of dumb. I mean, I’m sure there are plenty of reasons why they want to continue living where they do and I’m sure that some really are limited in some way, but for most, they can hardly complain about the cost. If you have a $500,000 asset, but you refuse to invest it properly- by using it yourself instead, then you are just making a particular choice. Those people would seem a lot more wealthy if they moved somewhere where they could buy the equivalent $200,000 house and have an extra $18,000 income guaraunteed.
So yeah, some people with $500,000 in assets don’t appear wealthy, but that may b/c they’re effectively flushing $2.5K a month down the toilet in rent. Its still a lot of money.
Generally speaking, the places with the lower housing also have lower pay for equivalent jobs. A house worth 300K now that was purchased a decade ago at $150K would have a mortgage payment closer to $1K/mo. To keep the say level of income, one must stay in the same area (generally) where replacement property will be no cheaper.
Nice try at completely missing the point of local costs.
Libertarian, you’re looking at it backwards. However ‘rich’ you are or aren’t, you are ahead of 99% of the world. That is, the vast majority of the planet’s population is fucking poor. That’s the real problem.
The point about local costs is,it seems to me, that the United States is, by any definition a propserous society. Within the context of that prosperity, most of us feel shafted because the bulk of this enormous group welath is being funnelled to a few. It only makes it more egregious that, by and large, these same few are also tapping other societies, both prosperous and non. And to add insult to injury, the top of our very tall heap tell us that we have THEM to thank for the heap to begin with. ConservAtive/libertarian econmoics seem predicated on a fundamental misunderstanding of cause and effect between rich people and prosperous societies. the Right would have us beleive that it’s rich people who create prosperity for the rest of us, by the act of being rich and getting richer. The fact that even desperately poor countries throughout history have had _some_ locally rich folks seems to contradict that. For a rising tide to lift everyone’s boat, it has to be an actual tide, and not somone diverting the river over to the swank marina where the richies keep their yachts. Am I at all coherent here, folks, or do I need to stop osting on cold medicine?
For a rising tide to lift everyone’s boat, it has to be an actual tide, and not somone diverting the river over to the swank marina where the richies keep their yachts.
Good one.
I would not live in this country if I did not have even the meagre health insurance I do, and honestly, one of the reasons I am not staying here after study is because the pathetic health care system here (�best in the world� my arse) … I once had to take public transportation across town after being attacked by a dog, bleeding, because to not go to my university’s hospital would have resulted in a huge bill.
Hey, Sarah, if you’re coming back home, we must arrange for me to buy you a drink or something.
*having just checked Sarah’s LJ* Yay Wellingtonians!
$500,000 American would get you something pretty decent here…
Sorry Phoenician (and Annamal!) but I’m not coming back to NZ any time soon (not to live anyway) … I’m actually looking at Canada for employment when I am done, as as much as I love, adore and miss NZ (hell, I have a live webcam widget looking out across Wellington on dashboard on my Mac), there aren’t that many options there at the PhD level, not and do what you want to do that is … course, though, if something is offered at the Department of Justice in Wellers, I would definitely be interested …
Uh, no. In Sweden, employers are by and large not allowed to fire workers, and I suspect that Denmark and Norway aren’t that different. See my above comment for levels of class mobility in these countries versus in the US (Norway’s at 0.17, I should add).
Different system, but the tradeoff still exists. They’d have higher class mobility if they loosened their economic system somewhat, and they could improve security by adding more regulation to the economy. Their balance point may be preferable to ours, depending on your point of view, but it’s still a balance point between conflicting goods.
I don’t know about that, but I have a dream of a better blogosphere, where people who make factual claims have to back them up.
Oh, come on. Where would we all go for fun if that were to happen? It’d be chirping crickets on 99% of blogs.
as as much as I love, adore and miss NZ (hell, I have a live webcam widget looking out across Wellington on dashboard on my Mac),
“She’s flying over Wellington harbour,
Oriental Bay standing there in the sunlight,
And they’re playing a tape for the landing,
Speed bonny boat, like a bird on the wing,
Onward the sailors cry,
No, she didn’t want to stay there,
She’s on her flight,
She’ll be standing on the same ground as we are,
Tomorrow night…”
Or perhaps not.
there aren’t that many options there at the PhD level, not and do what you want to do that is … course, though, if something is offered at the Department of Justice in Wellers, I would definitely be interested …
Well, you have got a point. Get too specialised and you have to seek a bigger place than 4 million people. I had an acquaintance who got her Phid hacking through sheep’s ovaries, but now runs a web design place.
Best of luck.
Given that the correlation between economic security and class mobility is positive, I’d say that the tradeoff doesn’t exist. The regulations ensure that people who don’t have rich parents can go to a good school on the state’s dime, get a good professional job, and get promoted without fear of getting arbitrarily fired by a psychotic boss.
Well, you know, seriously, web design might pay better …
But yeah, while not excessively specialised, my research focus doesn’t really work with NZ too much … I specialise in group identity conflicts and violence, such as inter-ethnic, inter-religious, etc … particularly hate crimes (which for my PhD I am focusing on against gays and lesbians).
I mean, NZ has it problems in those regards, sure, but on the whole we’re just too damn NICE *smile*
Thanks, I am going to need it … though that all said, the first chance I can get to go back home for a break, I’m totally going to be winging my way down there yesterday.
I could totally murder a steak & kidney pie, or a mince and cheese pie, with slatherings of Watties … or a pizza from Hell Pizza or Spagalimi’s Pizza… or a kiwi takeaway style giant burger, with pineapple, and egg, and bacon, and cheese, and tomato, and beetroot, etc, etc …
Or, you know, a simple filled-roll, a custard square, and a bottle of L&P …
Okay, it’s butt-crack early in the morning, and now I am making myself hungry ..
I remember reading this in Howard Zinn’s People’s History of the United States, and ever since then, whenever I’ve heard a conservative going on and on, Lileks-style, about how great things were back in the 50s, I’ve always wondered if they knew that part of the good ole 50s were these marginal tax rates. Probably not, eh?
Considering that I just had a major argument with my husband this morning over an offer I received to help organize a science journalism conference at my university that would also pay about half of what I currently make as a web monkey, this hit uncomfortably close to home for me. I find that, as someone who actually has to work to live, a lot of the things I’m told I need to do in order to become a journalist (unpaid or low-paid internships, entry level jobs making seven bucks an hour, and so on) are simply not within my means. Not that I expect to rake in the big bucks as a journalist, but when your rent gets jacked up because insurance has increased by something like 200% and property taxes by 150%, it makes it that much harder to stay afloat.
I thought this was a problem uniquely related to living in Florida (land of the corrupt and ineffective politicians who can’t seem to remove their lips from the asses of insurance companies and real estate developers), but evidently it’s much more widespread and insidious than I thought it was.
The entire essay is actually more about another elephant in the room that I leave basically unaddressed in this post, which is the fact that all these national politics are probably moot, anyway, because the world is actually being run now by transnational corporations. The war in Iraq is a good example of how Willis’ predictions are coming true—the American military has been basically commandeered by corporate interests to dismantle a nation-state that was getting in the way of certain assets that they’d like to have control over.
Not really. Have you read this by Eric over at Alterdestiny? It seems more and more that things are headed back to the way they were in the late 18th/early 19th centuries.
The top marginal rate was 91%, but nobody paid it. There were far more loopholes and tax shelters in those days.
The “real” tax rate (IE, what a real person generally pays) has been in a more or less steady upward trend through the 20th century, with some periods where it’s gone down. We pay more of a percentage of national income to the government today than we did in the 1950s.
Hmm, bad link?
Well, Just to reiterate, it’s a post about the former president of United Fruit Company, Sam Zemurray, and how the US government was complicit in his actions in destabilizing Honduras and how he helped overthrow the government to reinstall Bonilla.