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This is nothing new. Americans have always considered themselves temporarily poor. And while many don't become fantastically rich, there's still a huge amount

This is nothing new. Americans have always considered themselves temporarily poor. And while many don't become fantastically rich, there's still a huge amount of turnover at the top levels of wealth between generations.

krona 8y ago
Indeed, in the US 12% of the population will find themselves in the top 1% of the income distribution for at least one year. (https://www.nytimes.com/2014/04/20/opinion/sunday/from-rags-to-riches-to-rags.html?smid=pl-share https://www.nytimes.com/2014/04/20/opinion/sunday/from-rags-...)
- RickS 8y ago
  > 12% of the population will find themselves in the top 1% of the income distribution for at least one year That is just wild. I wish they dove deeper into the data here. The top 1% of earning, based on a quick google, is 1.3m/yr. That's a lot! Are there, say, estate windfalls pushing people around to cause some of those blips? Also, this article fails to separate income from wealth/assets, which seems to be a common pitfall in this kind of conversation. Many of the people with the most wealth are not those with the most income. So while there appears to be lots of income volatility, I would be interested in seeing the same thing for wealth over time.
  - huffmsa 8y ago
    Wealth typically only lasts 2-3 generations. That might change as people have fewer kids. Takes 2-5 generations to go from poverty to top 1%. I would give citations but I've forgotten where I heard this.
    - munk-a 8y ago
      Your phrasing is a bit misleading, wealth is very fleeting, but the 2-5 generations to get into the top 1% is not "typical" by definition 1% of people reside in the top 1% - if we were to assume that the cycle of boom and bust is the lower bound in your example (two to fall out, two to get in) then one out of every five generations a family should be in the 1%, yielding that 20% of the population should currently be in the top 1% - using your upper bounds it's a bit less silly but still mathematically unsound _and_ I would strongly challenge that 2-3 generations number. Evidence that I've seen doesn't support wealthy families falling out in 2-3 generations (except borderline wealthy families) and the dynamics of money are changing, the estate tax has been abolished and we simply don't have enough information past 1980 to see if that claim will hold true... and what evidence we have (general information about wealth inequality) is showing a strong trend to continue the concentration of wealth.
  - munk-a 8y ago
    Is it wild? I'm guessing this one year is the year they sell their "working" house and downsize into retirement. Many retirees will see a windfall of 1-2 million from going from a paid off property in a city to a house for their retirement in New Mexico. I know some specific cases of similar transitions moving from Boston to Vermont, when you don't need to be located near a job center you can find really cheap real estate.
  - ivalm 8y ago
    Top 1% if 422k/year. 1.3mil is closer to top 0.1%
- notacoward 8y ago
  GP was talking about wealth, not income. There's some room to argue whether a 12% figure for income represents high economic mobility. There's absolutely no room to argue that the much lower number for wealth is anything but a disgrace.
giggles_giggles 8y ago
This old trope again? Being a millionaire isn't even rich in many parts of the US anymore -- just look at Silicon Valley as an example. A million dollars gets you, what exactly in terms of housing there? Most of the millionaires that exist today are older folks that have paid off their homes, and most of that wealth is in their homes. As the article states at the end, Millenials will inherit much of that wealth as the Boomers die, just in time for articles like this to come out about Gen Z.
- idlewords 8y ago
  I never understood the "housing here is expensive so I'm not rich" argument. $500 only gets you a small hotel room at the Ritz-Carlton; that doesn't mean that $500 isn't a lot of money. It just means you elected to pay a lot for something other people get for less.
  - deleted 8y ago
    [deleted]
  - munk-a 8y ago
    It does mean you're not rich[1], what it doesn't mean is that you won't be rich when you retire, at that point you will shift your accumulated wealth to a region with a lower cost of living (in all probability) and then you'll get to enjoy it - but while you need to keep a large portion of your value tied up in a house so you can afford the house you don't have much in terms of liquid assets. [1] Assuming your labor isn't portable - if your labour is portable (i.e. you can move to rural montana and keep your job or a similarly paying one) then you're making an active choice to pay a high cost of living for the environment you're living in, many people can't remote themselves without cost so to continue to earn at the rates they're earning they need to stay put.
notacoward 8y ago
> still a huge amount of turnover at the top levels of wealth That's so far from being true that it's hard to assume good intent.

krona 8y ago

Indeed, in the US 12% of the population will find themselves in the top 1% of the income distribution for at least one year. (https://www.nytimes.com/2014/04/20/opinion/sunday/from-rags-to-riches-to-rags.html?smid=pl-share https://www.nytimes.com/2014/04/20/opinion/sunday/from-rags-...)

RickS 8y ago
> 12% of the population will find themselves in the top 1% of the income distribution for at least one year That is just wild. I wish they dove deeper into the data here. The top 1% of earning, based on a quick google, is 1.3m/yr. That's a lot! Are there, say, estate windfalls pushing people around to cause some of those blips? Also, this article fails to separate income from wealth/assets, which seems to be a common pitfall in this kind of conversation. Many of the people with the most wealth are not those with the most income. So while there appears to be lots of income volatility, I would be interested in seeing the same thing for wealth over time.
- huffmsa 8y ago
  Wealth typically only lasts 2-3 generations. That might change as people have fewer kids. Takes 2-5 generations to go from poverty to top 1%. I would give citations but I've forgotten where I heard this.
  - munk-a 8y ago
    Your phrasing is a bit misleading, wealth is very fleeting, but the 2-5 generations to get into the top 1% is not "typical" by definition 1% of people reside in the top 1% - if we were to assume that the cycle of boom and bust is the lower bound in your example (two to fall out, two to get in) then one out of every five generations a family should be in the 1%, yielding that 20% of the population should currently be in the top 1% - using your upper bounds it's a bit less silly but still mathematically unsound _and_ I would strongly challenge that 2-3 generations number. Evidence that I've seen doesn't support wealthy families falling out in 2-3 generations (except borderline wealthy families) and the dynamics of money are changing, the estate tax has been abolished and we simply don't have enough information past 1980 to see if that claim will hold true... and what evidence we have (general information about wealth inequality) is showing a strong trend to continue the concentration of wealth.
- munk-a 8y ago
  Is it wild? I'm guessing this one year is the year they sell their "working" house and downsize into retirement. Many retirees will see a windfall of 1-2 million from going from a paid off property in a city to a house for their retirement in New Mexico. I know some specific cases of similar transitions moving from Boston to Vermont, when you don't need to be located near a job center you can find really cheap real estate.
- ivalm 8y ago
  Top 1% if 422k/year. 1.3mil is closer to top 0.1%
notacoward 8y ago
GP was talking about wealth, not income. There's some room to argue whether a 12% figure for income represents high economic mobility. There's absolutely no room to argue that the much lower number for wealth is anything but a disgrace.

giggles_giggles 8y ago

This old trope again? Being a millionaire isn't even rich in many parts of the US anymore -- just look at Silicon Valley as an example. A million dollars gets you, what exactly in terms of housing there? Most of the millionaires that exist today are older folks that have paid off their homes, and most of that wealth is in their homes. As the article states at the end, Millenials will inherit much of that wealth as the Boomers die, just in time for articles like this to come out about Gen Z.

idlewords 8y ago
I never understood the "housing here is expensive so I'm not rich" argument. $500 only gets you a small hotel room at the Ritz-Carlton; that doesn't mean that $500 isn't a lot of money. It just means you elected to pay a lot for something other people get for less.
- deleted 8y ago
  [deleted]
- munk-a 8y ago
  It does mean you're not rich[1], what it doesn't mean is that you won't be rich when you retire, at that point you will shift your accumulated wealth to a region with a lower cost of living (in all probability) and then you'll get to enjoy it - but while you need to keep a large portion of your value tied up in a house so you can afford the house you don't have much in terms of liquid assets. [1] Assuming your labor isn't portable - if your labour is portable (i.e. you can move to rural montana and keep your job or a similarly paying one) then you're making an active choice to pay a high cost of living for the environment you're living in, many people can't remote themselves without cost so to continue to earn at the rates they're earning they need to stay put.

notacoward 8y ago

> still a huge amount of turnover at the top levels of wealth That's so far from being true that it's hard to assume good intent.