9 ms·

Why America Is the World’s First Poor Rich Country

99 points by monsieurpng 8y ago

avgDev 8y ago
I think this is pretty spot on. I recently visited Poland where i was born and raised for 14 years of my life. I know many people who came to US for work but have left. They earned more but spent more and did not feel good about their shitty low wage jobs. I think life is relatively good for tech people, and business people in high positions. There was a point in my life when I used foodstamps and medicaid. I suffered a serious allergic reaction to a medication which caused permanent damage to my neurological system and tendons. I ruined my credit due to the high cost of healthcare. However, I became really passionate about tech, now bought a house and rebuilt my credit. I still suffer from chronic pain but I manage it quite well and you would not be able to tell something is off. The US healthcare caused massive mental issues and suicidal thoughts. First I lost my job, then I lost my insurance....it was scary. Then, ACA passed and I was covered under medicaid. Seriously, if it wasn't for ACA I dont think I would continue my existence. I am back in work force making good money and am pretty happy. This article is really interesting, I feel as US has failed its citizens. Legislation is driven by lobbying. Seems like nobody cares about science and facts anymore in politics. I wonder if some of this is caused by massive data collection and gearing speeches towards things people want. Same thing happened to many news article, some dude looked at data said "these sensational titles/articles drive traffic", which drives revenue, WE NEED MORE. That's why CNN interviewed a dude that got sued by their parents because he would not move out at 31...... I love US and most people are great. I hope we can turn things around. I think politicians should be educated, smart people that work towards a greater good of a society.
- nsporillo 8y ago
  Yeah that dude who wouldn't move out was from the same town I grew up in and whenever I read the local news lately his story is always top news. As you might expect, a story like that generates a lot of user engagement.. tons of comments and replies.
- TangoTrotFox 8y ago
  'My fellow Americans, ask not what your country can do for you — ask what you can do for your country.' That's undoubtedly one of JFK's most famous quotes. It's interesting to think how much things have changed since then. Imagine if a politician, let alone a democratic one, said that. The response would be... less than positive. So what's changed? One thing that I think is easy to pinpoint is that we've turned sharply against nationalism for various reasons. But then a simple question. If we're to believe that devotion to the American culture and interests is bad, what is supposed to make people in this enormous nation of 325 million care for one another? Right, we can say we -as humans- ought care for one another naturally and unconditionally. And lots of people say they care about e.g. what's happening in places outside of this country (Africa as a typical example). The median energy/income put towards doing anything about those situations, even just among those who claim to care? Absolutely 0. In the heyday of America when there was a much stronger sense of connection between employer, employee, and generally people at large. Rich or poor, urban or rural, politician or voter, liberal or conservative - you were a fellow American. For instance the last time that a basic income in the US was mentioned actually came from a republican - Richard Nixon. That's not to say that I think it is/was a great idea, but rather that this deterioration of concern in society is a very new phenomena. Now we live in a society when a person goes to a congressional ballgame to try to kill as many congressmen as he can - many people were, shall we say, less than upset about his actions. There's certainly a chicken and egg question there, but the tautology needs to said: when people could not care less about one another (if they don't fit into their ingroup), it should come as no surprise when people could not care less about one another (if they don't fit into their ingroup).
ovulator 8y ago
I didn't make it past his first "fact" that most American's can't afford to scrape together $500. His source is a Google search, that search's first result is a CBS article, that article's source is a Bankrate.com survey. That survey[1] asked how someone would pay for an unexpected emergency, in which that % responded "from savings" The other options on the survey were "use a credit card", "borrow from friends/family" & "reduce spending". So this obviously doesn't mean they don't have the money, it simply shows how they would pay for it. As I would use a credit card to pay for an unexpected expense 100% of the time, but that doesn't mean I don't have the means to pay for the expense. [1]https://www.bankrate.com/banking/savings/survey-how-americans-contend-with-unexpected-expenses/ https://www.bankrate.com/banking/savings/survey-how-american...
- extralego 8y ago
  If you don’t have savings, that is not a solution. I understand it was offered as a multiple choice option on the test, but if not feasible in the person’s actual life, it is not an option for them. And same thing with the credit card idea. Getting credit cards is impossible or already maxed out for most people living in poverty, which is the grounds for the predatory pay day loan industry.
- shalmanese 8y ago
  If you want a more reliable cite, the Federal Reserve has studied this problem as well: https://www.federalreserve.gov/publications/files/2017-report-economic-well-being-us-households-201805.pdf https://www.federalreserve.gov/publications/files/2017-repor... "Four in 10 adults, if faced with an unexpected expense of $400, would either not be able to cover it or would cover it by selling something or borrowing money. This is an improvement from half of adults in 2013 being ill-prepared for such an expense."
- IOT_Apprentice 8y ago
  if you didn't make it past (ie didn't read further), then you are missing some salient points. If you unexpectedly end up unemployed for more than a few months, you will find that your options for scraping together $500 will get tighter and tighter as your credit cards max out, and you have no additional income to tap.
eddieplan9 8y ago
Take this piece with a huge grain of salt because it misquotes to exaggerate. The second statement - "A third of Americans can’t afford food, shelter, and healthcare" - is based on a CFPB survey [1] that scores "how people in the U.S. feel about their financial well-being". The survey finds that a third of Americans, experience "running out, or worrying about running out, of food, not being able to afford medical treatment or a place to live, or having utilities turned off". It's not hard to find enough people who are worrying about not being to afford medical treatment. The third statement - "Healthcare for a family now costs $28k " - is a misquote. The original report [2] states that "the cost of healthcare for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan is $28,166". The same report lists that employee contribution is $7,674, and employee out-of-pocket is $4,704. If you want to include the full premium as "cost", then you also need to adjust the median household income to include employee contribution and all sorts of non-wage benefits. [1] https://files.consumerfinance.gov/f/documents/201709_cfpb_financial-well-being-in-America.pdf https://files.consumerfinance.gov/f/documents/201709_cfpb_fi... [2] http://us.milliman.com/uploadedFiles/insight/Periodicals/mmi/2018-milliman-medical-index.pdf http://us.milliman.com/uploadedFiles/insight/Periodicals/mmi...
- donald123 8y ago
  1. Have you actually read the survey you referenced? It is not just finding random people on the street, it's using "GfK Knowledge Panel® (GfK panel), a recruited internet panel designed to be nationally representative of U.S. households.". You need better argument or evidence to dismiss the survey. 2. The point of the quote is to prove high cost of healthcare overall to the society, not just the employee. In employer's perspective, insurance premium is considered cost of the employee, which has impacts on the employees' wages. So although the statement may not be precise, the point is not wrong.
  - eddieplan9 8y ago
    1. I have. My main point is that the survey is about how people feel about their finance, not actual financial reality as in "one-third cannot afford food, shelter, and healthcare". The survey itself actually says > roughly one-third of individuals have difficulty making ends meet and approximately one out of five sometimes have difficulty paying for basic needs like food, housing, and medical care. So even taking it at face value, the ratio is 1/5 instead of 1/3? And also > while financial circumstances are highly correlated with financial well-being scores, individuals with quite different experiences can arrive at the same score This further indicates the survey is about people's perception about personal finance, not objective financial reality. 2. IMHO, the author's point is not really "US spends a lot on healthcare as a country", but that US is a "rich" country but people are "poor" because they have little dispensable income after paying for healthcare etc. Comparing total insurance premium against household income is a faulty way to support that point. I agree US spends a lot on healthcare, but it's not bad enough to justify labeling US people as "poor".
trevyn 8y ago
This article is completely ignorant of history. Massive numbers of people have lived in dismal conditions since the beginning of humanity, in regions that would be considered rich in their time.
- hsitz 8y ago
  >This article is completely ignorant of history. . . It doesn't sound like you actually read the article. Whether people have lived like that in former eras is irrelevant. The article talks about the U.S. in comparison with other rich democracies, and argues that the U.S. is "poor" (a "poor rich country") in a way we haven't seen before. The article also argues that the poverty in the U.S. is likely to give rise to authoritarianism and extremism, which are less likely to occur in a better balanced society.
  - trevyn 8y ago
    Ok, then it is an inaccurately titled article. :-)
    - arcticbull 8y ago
      Just read it. I'm curious what your thoughts are after you do, and how that compares to your initial reaction.
      - trevyn 8y ago
        It is filled with factual errors, unsupported assertions, and appeals to emotion. The rest of the site appears to be of similarly poor journalistic quality. Looking at the author's Amazon author description page, I judge that he is attempting to make a career of telling a certain segment of the population what they want to hear, and leveraging that echo-chamber passion to sell books, get speaking gigs, and the like.
        mbrodersen 8y ago
        What "factual errors"? On what basis is the site "of similarly poor journalistic quality"? Why do you attack the author instead of arguing facts?
oprah2018 8y ago
There is another way to look at this. In the current economy, anyone who wants to can get IT and programming skills and get a pretty good job. In fact, IT in general is a pathway to wealth, which is open to anyone, and leads to more wealth than many other career paths. You can be a 17 year old Javascript expert a get a $200k job without going to college. All the training materials you need to do this are online, for free. You need a $200 Chromebook, a Wifi connection, and some kind of ambition or drive.
- lightbyte 8y ago
  >You can be a 17 year old Javascript expert a get a $200k job without going to college. Please elaborate on what companies hire 17 year "javascript experts with no degree" starting at 200k
  - phil21 8y ago
    Yeah, not any more. Maybe in 1999 you could come in as a high school dropout and make an easy six figures since you truly were better at this "internet stuff" than the vast majority of the older IT folks. I doubt we're in for another massive technology shift like that though in our lifetimes where toys turn into business tools exceedingly rapidly. AI is about the only one I could think of, and the barrier of entry there is far higher than the $150k/yr 17 year old webdev job of olde. They were outliers, but they certainly existed within my friends group. Those that built independent websites/marketing/etc. did even better, and built rather good careers out of them over time. Many are now retired or semi-retired in their 30's. Those doors have since been firmly slammed shut though by those who came afterwards, now you are gated by the HR dragons from most jobs. It was a unique point in tech history I doubt will be re-created, but it's easy for those who lived it to think things are still like that. I got lucky to experience that and "come up" at the right time being interested in the right things. Today I'd have zero chances being unable to afford college. The competition is much more fierce as well.
- avgDev 8y ago
  I have CS degree, I interviewed recently in Chicago burbs. Junior income is around $60k to $80k......where do I sign up for these $200k Javascripts jobs?
maym86 8y ago
The amount of poverty I saw in the States after coming from the UK was shocking to me. So much money in the country but for people at the bottom it was visibly worse with much more homelessness and visible health problems.
- oh_sigh 8y ago
  Where did you travel in the states?
  - HarryHirsch 8y ago
    Can't speak for him, but long ago I took the wrong exit from the highway, ending up in North Philly. Merthyr Tydfil has nothing on North Philadelphia.
    - thiagocsf 8y ago
      How does it compare to Port Talbot?
      - HarryHirsch 8y ago
        Port Talbot can't have improved with they closed the steelworks down, but it can't possibly compete with Philly, the level of decay is unimaginable to a person from Western Europe.
  - Maarten88 8y ago
    I had the same experience, I was mostly in big, rich cities like NY, SF, LA, Seattle. From other travelers I heard when you travel deep into South Central US, you can find full-on third world scenery. It is shocking how many poor people are begging on the streets, in a country that is, on average, richer than where I live.
    - ravitation 8y ago
      The difference between urban and rural America is that in urban America you have the juxtaposition of wealth and poverty and in rural America you just have poverty.
weeksie 8y ago
While this is a bit breathless, I think it does call out the fact that American poor are much worse off than those in a typical rich country. Since the 80s the upper middle class has grown quite a bit while the working class and poor have lost ground. Still, the typical poor in America are far, far from the poor in a developing nation. The homeless (~500k out of 325mm) are pretty close though. The poverty rate has remained quite steady in the US, so despite the "feel" of there being more poor in the country that doesn't square with the facts [0]. The real issue which the article does a great job of calling out is the way that Americans pay a premium for many goods; it just doesn't connect that thought to anything illuminating. [0] https://www.washingtonpost.com/news/wonk/wp/2012/07/11/poverty-in-the-50-years-since-the-other-america-in-five-charts/ https://www.washingtonpost.com/news/wonk/wp/2012/07/11/pover...
- newnewpdro 8y ago
  Population growth necessitates a proportional drop in poverty rate just for things to stay the same. Looking at poverty through a lens which normalizes for population growth paints a completely different picture from what one will see in real life on the streets. When the rate stays constant and the population grows, the situation on the ground is worse, period.
  - weeksie 8y ago
    No. The poverty _rate_ declined since 1960 and has held steady since. That is a per capita measure and scales with population growth.
    - newnewpdro 8y ago
      That's the whole point - using a per capita measure is inappropriate.
      - weeksie 8y ago
        Ah I did misread your comment. That said, I have no idea why that would be inappropriate. Can you go into more detail because I must have missed your point. For instance, how are you judging the situation on the ground? From any objective measure a per capita decrease seems to be a win.
jorblumesea 8y ago
In other countries, the government (and the wealthy) subsidize services used by all to a much greater extent and are considered "public industries". In America, everyone is much more on their own and industries like healthcare are expected to turn a profit. Should people like Martin Shkreli have control over medicines? Most in the world would say no, in America it's yes. That's the difference. The American people are treated as a cash cow and industries that they use are businesses without any expectation of contributing to the public good. So while we are rich, we are nickle and dimed for everything from healthcare to education.
oh_sigh 8y ago
Besides for a few facts thrown around in the beginning, this is entirely an opinion piece. Even the facts in the beginning are presented in a misleading manner IMHO: > The average American can’t scrape together $500 for an emergency. A third of Americans can’t afford food, shelter, and healthcare. Healthcare for a family now costs $28k — about half of median income, which is $60k. The "source" in the first statement links to a google search for "american 500 emergency". Not a compelling source IMHO. The source for the second statement seems to be legitimate, but the author claims that 'a third of Americans can't afford food, shelter, and healthcare', when in fact the source only claims that a third of americans may struggle to afford those things. There is a difference. The final statement is conflating employer-paid healthcare costs with median income, as if that $28k is coming out of the $60k - when it is not - most of it is being paid by an employer. And then the rest of the article is an opinion piece full of assertions and little evidence. Pretty low quality article for HN in my opinion.
- thiagocsf 8y ago
  I don’t think it matter that the 28k are paid by the employer and not from the 60k salary. Perhaps this person could be making 88k instead? Also, while you’re inbetween jobs, health care still costs 28k.
  - oh_sigh 8y ago
    I agree. My point is that it is a misleading juxtaposition. I think most people who read that sentence would parse it as something like Americans income is 60k, and then after they pay for healthcare they have 32k or less left
    - arcticbull 8y ago
      It's really hard to make a direct comparison as in countries with socialized medicine, you don't really have co-pays, deductibles, caps, out-of-pocket maximums, etc. The implicit assumption you make is also that the average American gets their insurance through their employer -- they do, but that's not the whole picture. 55.7% of Americans get cover from employers, 16.2% from individual markets, 19.4% from Medicaid and 16.7% from Medicare. [1] After all, if people can't come up with $500 for emergencies, what's the chance they can come up with co-pays? This is measured in [2] and they conclude 41,000,000 Americans are underinsured. So they may not have 32K left, but they probably do have less than 60K left. In fact I'd imagine that the 55.7% who have employer-paid coverage probably make way more than the 44.3% who do not. [1] https://en.wikipedia.org/wiki/Health_insurance_coverage_in_the_United_States https://en.wikipedia.org/wiki/Health_insurance_coverage_in_t... [2] http://www.commonwealthfund.org/~/media/files/publications/issue-brief/2017/oct/collins_underinsured_biennial_ib.pdf http://www.commonwealthfund.org/~/media/files/publications/i...
deleted 8y ago
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mnm1 8y ago
Nothing in this article should be a surprise to anyone who has been following what's been happening in America lately or to anyone who understands its history. America has throughout its history developed extreme systems of oppression, subjugation, and poverty to control its people and in attempts to control other nations. The main difference between the current implementation described in the article and previous implementations is that it's less focused on race. In the true spirit of progressiveness, the current implementation tries to fuck over everyone, not just minorities, in an effort to update the systems of old. It is a new type of poverty to exist, but not a novel one. It's one that was available to all other developed countries, one that every single one of those countries explicitly rejected. I think analyzing why all other developed, rich countries of the world blatantly rejected this system while the US supported and supports it to the extreme would be a fascinating study.
ciconia 8y ago
I find the article quite a bit hyperbolic, but it still rings true. Technology is a double-edged sword, and America's obsession with it is wreaking havoc. The more you use it, the more you depend on it. and the more people spend time tapping virtual buttons on touch screens, the more they become removed from the "basics of life", separated from physical existence by more and more layers of "abstraction" - in more than one sense. It does seem like lots of people today don't know how to care of themselves in the most basic way - cook healthy food, grow some vegetables, do laundry or wash dishes by hand, prepare a grandma medicine for one's children when they have a fever... Instead they automatically reach for their credit card and make a purchase. No wonder everything is so expensive when you depend on "services" for every little necessity of life.
kinsomo 8y ago
I liked his idea that the common American is stuck at the loser-end of a system of "asymmetric risk." Americans are expected to take on more and more "personal responsibility" (i.e. risk) for healthcare, for securing income, etc. and that means they're subject to all the consequences of any failure. On the other hand the powerful and wealthy monopolize the rewards of risk, and broadly refuse to share it. However, they have such large cushion (and connections) that they never really took any personal risks at all. If they fail, they'll probably be fine (except maybe with some hurt feelings).
- jorblumesea 8y ago
  The rich (and their lobbyists) write the laws. The system is set up this way intentionally. The public subsidize the risks of the wealthy while brainwashing the lower classes to accept these risks as their "lot in life". It's not some crazy accident, the game is rigged. You can see this play out in the bank bailouts, the new tax laws and various other policies. America is a country for the rich with rules written by the rich.
- Chyzwar 8y ago
  There are other factors. The US is a big sparsely populated country that is relatively far from business partners. Military dominance is required to continue a current foreign relationship and protect global corporations originated in the US. Even Obama manage to only make a tiny turn to the left. The US is like Titanic, too big to make drastic turns and cannot afford to slow down. Larger geopolitical plays influence US more than social rich vs poor. Look how China outmaneuver the US with peaceful foreign policy making military complex useless. Free trade that allowed to move/outsource low-value manufacturing now is turned against the US when technology advantage is shrinking.
pasbesoin 8y ago
Years ago, I saw/read a presentation from a prominent economist arguing that, more than financial resources, people should look at the changing distribution of risk in the U.S. So, I started doing so. And so far, it has corresponded pretty well with other circumstances I've been observing. There's been an enormous shift of risk from institutions to individuals. This economist argued for it accelerating in the 1970's and continuing since. Sometimes, simplistic phrases are nonetheless useful -- sometimes even defining, if devoid of the details. Divide and conquer. I think of that often, with regard to present circumstances in the U.S. Just lately, I ran across a "random" article on social media. About a relatively little known Nobel laureate who has apparently significantly informed -- or, provided cover for -- the very self-centered and transactional philosophy and behavior of oligarchs and monopolists like the Koch brothers. I had to leave off reading it about halfway through, with the intention to return. And, it mentions an apparently well-received book on the topic. I'm not familiar with this web site, but here's that article's URL: https://www.ineteconomics.org/perspectives/blog/meet-the-economist-behind-the-one-percents-stealth-takeover-of-america https://www.ineteconomics.org/perspectives/blog/meet-the-eco...
tolger 8y ago
That was definitely worth reading. I feel the crunch as a software engineer. I am still able to max my 401k, but after taxes, insurance premiums, mortgage, and a few nights out with the wife, I have little, if any, to invest. I feel like I should be saving more, but somehow the cost of living is rising while our incomes are staying flat.
xupybd 8y ago
"It’s extreme capitalism meets Social Darwinism by way of rugged self-reliance crossed with puritanical cruelty." I don't know if this is true. There seems to be something else emerging in America.A failed attempt at socialising thing one making the situation worse. Yes medical costs have sky rocketed due in part to an attempt to give universal health care. They are accused of extreme capitalism but bail out large corporations and subsidise the growing of corn. Things seem pretty bad over there but I don't think think they have a well regulated free market, they have something else. The article accurately pointed out the asymmetric risk. A society cannot function with everyone living on the knife edge like that. The only insulation seems to be extreme wealth. But I don't know that socialism will fix this.
volgo 8y ago
Quality of life is not just about amount of money you earn. It's about your status in society. You can make a ton of money feel low status (ex. oppressed minorities) and your life wouldn't be very good You can make very little money and feel very high status (ex. a village elder) and your life would be amazing. In America, the upper class have a ton of money and medium status - the poor hates them and it's generally considered impolite to show off your wealth. The lower class have no money and no status. No one really feels that secure

99 points by monsieurpng 8y ago

I think this is pretty spot on. I recently visited Poland where i was born and raised for 14 years of my life. I know many people who came to US for work but have left. They earned more but spent more and did not feel good about their shitty low wage jobs. I think life is relatively good for tech people, and business people in high positions. There was a point in my life when I used foodstamps and medicaid. I suffered a serious allergic reaction to a medication which caused permanent damage to my neurological system and tendons. I ruined my credit due to the high cost of healthcare. However, I became really passionate about tech, now bought a house and rebuilt my credit. I still suffer from chronic pain but I manage it quite well and you would not be able to tell something is off. The US healthcare caused massive mental issues and suicidal thoughts. First I lost my job, then I lost my insurance....it was scary. Then, ACA passed and I was covered under medicaid. Seriously, if it wasn't for ACA I dont think I would continue my existence. I am back in work force making good money and am pretty happy. This article is really interesting, I feel as US has failed its citizens. Legislation is driven by lobbying. Seems like nobody cares about science and facts anymore in politics. I wonder if some of this is caused by massive data collection and gearing speeches towards things people want. Same thing happened to many news article, some dude looked at data said "these sensational titles/articles drive traffic", which drives revenue, WE NEED MORE. That's why CNN interviewed a dude that got sued by their parents because he would not move out at 31...... I love US and most people are great. I hope we can turn things around. I think politicians should be educated, smart people that work towards a greater good of a society.

nsporillo 8y ago
Yeah that dude who wouldn't move out was from the same town I grew up in and whenever I read the local news lately his story is always top news. As you might expect, a story like that generates a lot of user engagement.. tons of comments and replies.
TangoTrotFox 8y ago
'My fellow Americans, ask not what your country can do for you — ask what you can do for your country.' That's undoubtedly one of JFK's most famous quotes. It's interesting to think how much things have changed since then. Imagine if a politician, let alone a democratic one, said that. The response would be... less than positive. So what's changed? One thing that I think is easy to pinpoint is that we've turned sharply against nationalism for various reasons. But then a simple question. If we're to believe that devotion to the American culture and interests is bad, what is supposed to make people in this enormous nation of 325 million care for one another? Right, we can say we -as humans- ought care for one another naturally and unconditionally. And lots of people say they care about e.g. what's happening in places outside of this country (Africa as a typical example). The median energy/income put towards doing anything about those situations, even just among those who claim to care? Absolutely 0. In the heyday of America when there was a much stronger sense of connection between employer, employee, and generally people at large. Rich or poor, urban or rural, politician or voter, liberal or conservative - you were a fellow American. For instance the last time that a basic income in the US was mentioned actually came from a republican - Richard Nixon. That's not to say that I think it is/was a great idea, but rather that this deterioration of concern in society is a very new phenomena. Now we live in a society when a person goes to a congressional ballgame to try to kill as many congressmen as he can - many people were, shall we say, less than upset about his actions. There's certainly a chicken and egg question there, but the tautology needs to said: when people could not care less about one another (if they don't fit into their ingroup), it should come as no surprise when people could not care less about one another (if they don't fit into their ingroup).

ovulator 8y ago

I didn't make it past his first "fact" that most American's can't afford to scrape together $500. His source is a Google search, that search's first result is a CBS article, that article's source is a Bankrate.com survey. That survey[1] asked how someone would pay for an unexpected emergency, in which that % responded "from savings" The other options on the survey were "use a credit card", "borrow from friends/family" & "reduce spending". So this obviously doesn't mean they don't have the money, it simply shows how they would pay for it. As I would use a credit card to pay for an unexpected expense 100% of the time, but that doesn't mean I don't have the means to pay for the expense. [1]https://www.bankrate.com/banking/savings/survey-how-americans-contend-with-unexpected-expenses/ https://www.bankrate.com/banking/savings/survey-how-american...

extralego 8y ago
If you don’t have savings, that is not a solution. I understand it was offered as a multiple choice option on the test, but if not feasible in the person’s actual life, it is not an option for them. And same thing with the credit card idea. Getting credit cards is impossible or already maxed out for most people living in poverty, which is the grounds for the predatory pay day loan industry.
shalmanese 8y ago
If you want a more reliable cite, the Federal Reserve has studied this problem as well: https://www.federalreserve.gov/publications/files/2017-report-economic-well-being-us-households-201805.pdf https://www.federalreserve.gov/publications/files/2017-repor... "Four in 10 adults, if faced with an unexpected expense of $400, would either not be able to cover it or would cover it by selling something or borrowing money. This is an improvement from half of adults in 2013 being ill-prepared for such an expense."
IOT_Apprentice 8y ago
if you didn't make it past (ie didn't read further), then you are missing some salient points. If you unexpectedly end up unemployed for more than a few months, you will find that your options for scraping together $500 will get tighter and tighter as your credit cards max out, and you have no additional income to tap.

eddieplan9 8y ago

Take this piece with a huge grain of salt because it misquotes to exaggerate. The second statement - "A third of Americans can’t afford food, shelter, and healthcare" - is based on a CFPB survey [1] that scores "how people in the U.S. feel about their financial well-being". The survey finds that a third of Americans, experience "running out, or worrying about running out, of food, not being able to afford medical treatment or a place to live, or having utilities turned off". It's not hard to find enough people who are worrying about not being to afford medical treatment. The third statement - "Healthcare for a family now costs $28k " - is a misquote. The original report [2] states that "the cost of healthcare for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan is $28,166". The same report lists that employee contribution is $7,674, and employee out-of-pocket is $4,704. If you want to include the full premium as "cost", then you also need to adjust the median household income to include employee contribution and all sorts of non-wage benefits. [1] https://files.consumerfinance.gov/f/documents/201709_cfpb_financial-well-being-in-America.pdf https://files.consumerfinance.gov/f/documents/201709_cfpb_fi... [2] http://us.milliman.com/uploadedFiles/insight/Periodicals/mmi/2018-milliman-medical-index.pdf http://us.milliman.com/uploadedFiles/insight/Periodicals/mmi...

donald123 8y ago
1. Have you actually read the survey you referenced? It is not just finding random people on the street, it's using "GfK Knowledge Panel® (GfK panel), a recruited internet panel designed to be nationally representative of U.S. households.". You need better argument or evidence to dismiss the survey. 2. The point of the quote is to prove high cost of healthcare overall to the society, not just the employee. In employer's perspective, insurance premium is considered cost of the employee, which has impacts on the employees' wages. So although the statement may not be precise, the point is not wrong.
- eddieplan9 8y ago
  1. I have. My main point is that the survey is about how people feel about their finance, not actual financial reality as in "one-third cannot afford food, shelter, and healthcare". The survey itself actually says > roughly one-third of individuals have difficulty making ends meet and approximately one out of five sometimes have difficulty paying for basic needs like food, housing, and medical care. So even taking it at face value, the ratio is 1/5 instead of 1/3? And also > while financial circumstances are highly correlated with financial well-being scores, individuals with quite different experiences can arrive at the same score This further indicates the survey is about people's perception about personal finance, not objective financial reality. 2. IMHO, the author's point is not really "US spends a lot on healthcare as a country", but that US is a "rich" country but people are "poor" because they have little dispensable income after paying for healthcare etc. Comparing total insurance premium against household income is a faulty way to support that point. I agree US spends a lot on healthcare, but it's not bad enough to justify labeling US people as "poor".

trevyn 8y ago

This article is completely ignorant of history. Massive numbers of people have lived in dismal conditions since the beginning of humanity, in regions that would be considered rich in their time.

hsitz 8y ago
>This article is completely ignorant of history. . . It doesn't sound like you actually read the article. Whether people have lived like that in former eras is irrelevant. The article talks about the U.S. in comparison with other rich democracies, and argues that the U.S. is "poor" (a "poor rich country") in a way we haven't seen before. The article also argues that the poverty in the U.S. is likely to give rise to authoritarianism and extremism, which are less likely to occur in a better balanced society.
- trevyn 8y ago
  Ok, then it is an inaccurately titled article. :-)
  - arcticbull 8y ago
    Just read it. I'm curious what your thoughts are after you do, and how that compares to your initial reaction.
    - trevyn 8y ago
      It is filled with factual errors, unsupported assertions, and appeals to emotion. The rest of the site appears to be of similarly poor journalistic quality. Looking at the author's Amazon author description page, I judge that he is attempting to make a career of telling a certain segment of the population what they want to hear, and leveraging that echo-chamber passion to sell books, get speaking gigs, and the like.
      - mbrodersen 8y ago
        What "factual errors"? On what basis is the site "of similarly poor journalistic quality"? Why do you attack the author instead of arguing facts?

oprah2018 8y ago

There is another way to look at this. In the current economy, anyone who wants to can get IT and programming skills and get a pretty good job. In fact, IT in general is a pathway to wealth, which is open to anyone, and leads to more wealth than many other career paths. You can be a 17 year old Javascript expert a get a $200k job without going to college. All the training materials you need to do this are online, for free. You need a $200 Chromebook, a Wifi connection, and some kind of ambition or drive.

lightbyte 8y ago
>You can be a 17 year old Javascript expert a get a $200k job without going to college. Please elaborate on what companies hire 17 year "javascript experts with no degree" starting at 200k
- phil21 8y ago
  Yeah, not any more. Maybe in 1999 you could come in as a high school dropout and make an easy six figures since you truly were better at this "internet stuff" than the vast majority of the older IT folks. I doubt we're in for another massive technology shift like that though in our lifetimes where toys turn into business tools exceedingly rapidly. AI is about the only one I could think of, and the barrier of entry there is far higher than the $150k/yr 17 year old webdev job of olde. They were outliers, but they certainly existed within my friends group. Those that built independent websites/marketing/etc. did even better, and built rather good careers out of them over time. Many are now retired or semi-retired in their 30's. Those doors have since been firmly slammed shut though by those who came afterwards, now you are gated by the HR dragons from most jobs. It was a unique point in tech history I doubt will be re-created, but it's easy for those who lived it to think things are still like that. I got lucky to experience that and "come up" at the right time being interested in the right things. Today I'd have zero chances being unable to afford college. The competition is much more fierce as well.
avgDev 8y ago
I have CS degree, I interviewed recently in Chicago burbs. Junior income is around $60k to $80k......where do I sign up for these $200k Javascripts jobs?

maym86 8y ago

The amount of poverty I saw in the States after coming from the UK was shocking to me. So much money in the country but for people at the bottom it was visibly worse with much more homelessness and visible health problems.

oh_sigh 8y ago
Where did you travel in the states?
- HarryHirsch 8y ago
  Can't speak for him, but long ago I took the wrong exit from the highway, ending up in North Philly. Merthyr Tydfil has nothing on North Philadelphia.
  - thiagocsf 8y ago
    How does it compare to Port Talbot?
    - HarryHirsch 8y ago
      Port Talbot can't have improved with they closed the steelworks down, but it can't possibly compete with Philly, the level of decay is unimaginable to a person from Western Europe.
- Maarten88 8y ago
  I had the same experience, I was mostly in big, rich cities like NY, SF, LA, Seattle. From other travelers I heard when you travel deep into South Central US, you can find full-on third world scenery. It is shocking how many poor people are begging on the streets, in a country that is, on average, richer than where I live.
  - ravitation 8y ago
    The difference between urban and rural America is that in urban America you have the juxtaposition of wealth and poverty and in rural America you just have poverty.

weeksie 8y ago

While this is a bit breathless, I think it does call out the fact that American poor are much worse off than those in a typical rich country. Since the 80s the upper middle class has grown quite a bit while the working class and poor have lost ground. Still, the typical poor in America are far, far from the poor in a developing nation. The homeless (~500k out of 325mm) are pretty close though. The poverty rate has remained quite steady in the US, so despite the "feel" of there being more poor in the country that doesn't square with the facts [0]. The real issue which the article does a great job of calling out is the way that Americans pay a premium for many goods; it just doesn't connect that thought to anything illuminating. [0] https://www.washingtonpost.com/news/wonk/wp/2012/07/11/poverty-in-the-50-years-since-the-other-america-in-five-charts/ https://www.washingtonpost.com/news/wonk/wp/2012/07/11/pover...

newnewpdro 8y ago
Population growth necessitates a proportional drop in poverty rate just for things to stay the same. Looking at poverty through a lens which normalizes for population growth paints a completely different picture from what one will see in real life on the streets. When the rate stays constant and the population grows, the situation on the ground is worse, period.
- weeksie 8y ago
  No. The poverty _rate_ declined since 1960 and has held steady since. That is a per capita measure and scales with population growth.
  - newnewpdro 8y ago
    That's the whole point - using a per capita measure is inappropriate.
    - weeksie 8y ago
      Ah I did misread your comment. That said, I have no idea why that would be inappropriate. Can you go into more detail because I must have missed your point. For instance, how are you judging the situation on the ground? From any objective measure a per capita decrease seems to be a win.

jorblumesea 8y ago

In other countries, the government (and the wealthy) subsidize services used by all to a much greater extent and are considered "public industries". In America, everyone is much more on their own and industries like healthcare are expected to turn a profit. Should people like Martin Shkreli have control over medicines? Most in the world would say no, in America it's yes. That's the difference. The American people are treated as a cash cow and industries that they use are businesses without any expectation of contributing to the public good. So while we are rich, we are nickle and dimed for everything from healthcare to education.

oh_sigh 8y ago

Besides for a few facts thrown around in the beginning, this is entirely an opinion piece. Even the facts in the beginning are presented in a misleading manner IMHO: > The average American can’t scrape together $500 for an emergency. A third of Americans can’t afford food, shelter, and healthcare. Healthcare for a family now costs $28k — about half of median income, which is $60k. The "source" in the first statement links to a google search for "american 500 emergency". Not a compelling source IMHO. The source for the second statement seems to be legitimate, but the author claims that 'a third of Americans can't afford food, shelter, and healthcare', when in fact the source only claims that a third of americans may struggle to afford those things. There is a difference. The final statement is conflating employer-paid healthcare costs with median income, as if that $28k is coming out of the $60k - when it is not - most of it is being paid by an employer. And then the rest of the article is an opinion piece full of assertions and little evidence. Pretty low quality article for HN in my opinion.

thiagocsf 8y ago
I don’t think it matter that the 28k are paid by the employer and not from the 60k salary. Perhaps this person could be making 88k instead? Also, while you’re inbetween jobs, health care still costs 28k.
- oh_sigh 8y ago
  I agree. My point is that it is a misleading juxtaposition. I think most people who read that sentence would parse it as something like Americans income is 60k, and then after they pay for healthcare they have 32k or less left
  - arcticbull 8y ago
    It's really hard to make a direct comparison as in countries with socialized medicine, you don't really have co-pays, deductibles, caps, out-of-pocket maximums, etc. The implicit assumption you make is also that the average American gets their insurance through their employer -- they do, but that's not the whole picture. 55.7% of Americans get cover from employers, 16.2% from individual markets, 19.4% from Medicaid and 16.7% from Medicare. [1] After all, if people can't come up with $500 for emergencies, what's the chance they can come up with co-pays? This is measured in [2] and they conclude 41,000,000 Americans are underinsured. So they may not have 32K left, but they probably do have less than 60K left. In fact I'd imagine that the 55.7% who have employer-paid coverage probably make way more than the 44.3% who do not. [1] https://en.wikipedia.org/wiki/Health_insurance_coverage_in_the_United_States https://en.wikipedia.org/wiki/Health_insurance_coverage_in_t... [2] http://www.commonwealthfund.org/~/media/files/publications/issue-brief/2017/oct/collins_underinsured_biennial_ib.pdf http://www.commonwealthfund.org/~/media/files/publications/i...

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mnm1 8y ago

Nothing in this article should be a surprise to anyone who has been following what's been happening in America lately or to anyone who understands its history. America has throughout its history developed extreme systems of oppression, subjugation, and poverty to control its people and in attempts to control other nations. The main difference between the current implementation described in the article and previous implementations is that it's less focused on race. In the true spirit of progressiveness, the current implementation tries to fuck over everyone, not just minorities, in an effort to update the systems of old. It is a new type of poverty to exist, but not a novel one. It's one that was available to all other developed countries, one that every single one of those countries explicitly rejected. I think analyzing why all other developed, rich countries of the world blatantly rejected this system while the US supported and supports it to the extreme would be a fascinating study.

ciconia 8y ago

I find the article quite a bit hyperbolic, but it still rings true. Technology is a double-edged sword, and America's obsession with it is wreaking havoc. The more you use it, the more you depend on it. and the more people spend time tapping virtual buttons on touch screens, the more they become removed from the "basics of life", separated from physical existence by more and more layers of "abstraction" - in more than one sense. It does seem like lots of people today don't know how to care of themselves in the most basic way - cook healthy food, grow some vegetables, do laundry or wash dishes by hand, prepare a grandma medicine for one's children when they have a fever... Instead they automatically reach for their credit card and make a purchase. No wonder everything is so expensive when you depend on "services" for every little necessity of life.

kinsomo 8y ago

I liked his idea that the common American is stuck at the loser-end of a system of "asymmetric risk." Americans are expected to take on more and more "personal responsibility" (i.e. risk) for healthcare, for securing income, etc. and that means they're subject to all the consequences of any failure. On the other hand the powerful and wealthy monopolize the rewards of risk, and broadly refuse to share it. However, they have such large cushion (and connections) that they never really took any personal risks at all. If they fail, they'll probably be fine (except maybe with some hurt feelings).

jorblumesea 8y ago
The rich (and their lobbyists) write the laws. The system is set up this way intentionally. The public subsidize the risks of the wealthy while brainwashing the lower classes to accept these risks as their "lot in life". It's not some crazy accident, the game is rigged. You can see this play out in the bank bailouts, the new tax laws and various other policies. America is a country for the rich with rules written by the rich.
Chyzwar 8y ago
There are other factors. The US is a big sparsely populated country that is relatively far from business partners. Military dominance is required to continue a current foreign relationship and protect global corporations originated in the US. Even Obama manage to only make a tiny turn to the left. The US is like Titanic, too big to make drastic turns and cannot afford to slow down. Larger geopolitical plays influence US more than social rich vs poor. Look how China outmaneuver the US with peaceful foreign policy making military complex useless. Free trade that allowed to move/outsource low-value manufacturing now is turned against the US when technology advantage is shrinking.

pasbesoin 8y ago

Years ago, I saw/read a presentation from a prominent economist arguing that, more than financial resources, people should look at the changing distribution of risk in the U.S. So, I started doing so. And so far, it has corresponded pretty well with other circumstances I've been observing. There's been an enormous shift of risk from institutions to individuals. This economist argued for it accelerating in the 1970's and continuing since. Sometimes, simplistic phrases are nonetheless useful -- sometimes even defining, if devoid of the details. Divide and conquer. I think of that often, with regard to present circumstances in the U.S. Just lately, I ran across a "random" article on social media. About a relatively little known Nobel laureate who has apparently significantly informed -- or, provided cover for -- the very self-centered and transactional philosophy and behavior of oligarchs and monopolists like the Koch brothers. I had to leave off reading it about halfway through, with the intention to return. And, it mentions an apparently well-received book on the topic. I'm not familiar with this web site, but here's that article's URL: https://www.ineteconomics.org/perspectives/blog/meet-the-economist-behind-the-one-percents-stealth-takeover-of-america https://www.ineteconomics.org/perspectives/blog/meet-the-eco...

tolger 8y ago

That was definitely worth reading. I feel the crunch as a software engineer. I am still able to max my 401k, but after taxes, insurance premiums, mortgage, and a few nights out with the wife, I have little, if any, to invest. I feel like I should be saving more, but somehow the cost of living is rising while our incomes are staying flat.

xupybd 8y ago

"It’s extreme capitalism meets Social Darwinism by way of rugged self-reliance crossed with puritanical cruelty." I don't know if this is true. There seems to be something else emerging in America.A failed attempt at socialising thing one making the situation worse. Yes medical costs have sky rocketed due in part to an attempt to give universal health care. They are accused of extreme capitalism but bail out large corporations and subsidise the growing of corn. Things seem pretty bad over there but I don't think think they have a well regulated free market, they have something else. The article accurately pointed out the asymmetric risk. A society cannot function with everyone living on the knife edge like that. The only insulation seems to be extreme wealth. But I don't know that socialism will fix this.

volgo 8y ago

Quality of life is not just about amount of money you earn. It's about your status in society. You can make a ton of money feel low status (ex. oppressed minorities) and your life wouldn't be very good You can make very little money and feel very high status (ex. a village elder) and your life would be amazing. In America, the upper class have a ton of money and medium status - the poor hates them and it's generally considered impolite to show off your wealth. The lower class have no money and no status. No one really feels that secure