4 ms·

Isn't wealth the red herring, and income the proper measure? After all, the median (50%tile) wealth is nearly zero. Amongst those with zero wealth, the top in

Isn't wealth the red herring, and income the proper measure? After all, the median (50%tile) wealth is nearly zero. Amongst those with zero wealth, the top income earners clearly have better lives than the low income earners, since the top income earners can consume more. The ultimate measure of resources is how much a person can consume a year. Income is equivalent to what you can steady-state consume. Wealth is just what you happened to save up to that point in time. Since the wealth gap is larger than the income gap (since wealth is saved past income), the wealth gap tends to be pointed out by people who want to overemphasize inequality.

alexkcd 7y ago
No, because 10M generates a steady return in a growing economy. So the steady-state consumption of someone with a net worth of $10M is much greater than someone with $0, all other things (e.g., income) being equal.
bobbydroptables 7y ago
A person with $10M in wealth should be earning $500k a year taxed at capital gains rates. This person does not and will not ever live like a mere mortal (unless for show or sport). Assuming he's not an idiot, the $10M guy would have to try reasonably hard to become broke. A person earning $500k/yr is reasonably likely to be a normal guy--maybe semi talented business person or tech exec paying regular income taxes (at least partly) that could quickly become broke or at least become a mere mortal again if he stopped working. I don't really have anything against this guy. He's not a pervasive driver of inequality. He's not at the tier of wealth where you're buying influence. He's likely stuck in an expensive COL place. Unlike Mr. $10M, he probably hasn't carefully shielded his funds from divorce, family, etc. >Wealth is just what you happened to save up to that point in time. Nobody just "happens to save up" $10m. You either inherited it, lucked into it or grinded for years or (more likely) decades with the express aim of a payday (and you got lucky enough to get one).
thatfrenchguy 7y ago
> After all, the median (50%tile) wealth is nearly zero Median wealth in the US ~97k. It’s quite stunning one could think a society would work with the 50-percentile being zero.
- cannonedhamster 7y ago
  Median income in the US is much lower than 97k. It's around 65k. Median net worth is about 68k. Mean is slightly higher because the top .001 makes so much more than everyone else. It's definitely higher than zero. Not sure where your numbers came from?
  - MR4D 7y ago
    According to Marketwatch [1] you are incorrect. The MEDIAN NET WORTH is $97,300. The MEAN is way higher at $692,100. Also, note that this figure varies considerably by age and education, as you might expect. [1] - https://www.nerdwallet.com/article/how-your-net-worth-compares-and-what-matters-more https://www.nerdwallet.com/article/how-your-net-worth-compar...
    - thatfrenchguy 7y ago
      Yeah, everyone knows means are lying, especially in super-unequal societies. No-one cares about the mean, you want to look at the distribution
JDiculous 7y ago
> the median (50%tile) wealth is nearly zero That sounds way more alarming than whatever the median income is. > the top income earners clearly have better lives than the low income earners, since the top income earners can consume more. The top wealth owners clearly have better lives than low wealth owners because the former don't have to work, yet make more money and pay less in taxes than everyone else. You haven't made a convincing case for why wealth shouldn't get more attention than income (or at least why it shouldn't get more attention, since the dialogue among politicians and in the media seems to exclusively focus on income despite income taxes being significantly higher than capital gains taxes).
LeftHandPath 7y ago
It also seems that the title is misrepresenting the facts. Needing more to reach the top one percent of an arbitrarily separated population should suggest that the rest of the population is also benefiting. E.g. if you needed less to join the top 1%, then it could be suggested that the gap is increasing. If you need more... well, it could just as easily follow that the bottom 99% percent have merely moved closer to the top 1%, effectively raising the bar (which, as an arbitrary point, shifts all the time anyways). That said, it could be argued the other way - but the evidence for either direction is lacking. Because the issue is being raised by people who tend to overemphasize inequality, I tend to lean the opposite direction - perhaps we should re-evaluate the way we define upper and lower class.

alexkcd 7y ago

No, because 10M generates a steady return in a growing economy. So the steady-state consumption of someone with a net worth of $10M is much greater than someone with $0, all other things (e.g., income) being equal.

bobbydroptables 7y ago

A person with $10M in wealth should be earning $500k a year taxed at capital gains rates. This person does not and will not ever live like a mere mortal (unless for show or sport). Assuming he's not an idiot, the $10M guy would have to try reasonably hard to become broke. A person earning $500k/yr is reasonably likely to be a normal guy--maybe semi talented business person or tech exec paying regular income taxes (at least partly) that could quickly become broke or at least become a mere mortal again if he stopped working. I don't really have anything against this guy. He's not a pervasive driver of inequality. He's not at the tier of wealth where you're buying influence. He's likely stuck in an expensive COL place. Unlike Mr. $10M, he probably hasn't carefully shielded his funds from divorce, family, etc. >Wealth is just what you happened to save up to that point in time. Nobody just "happens to save up" $10m. You either inherited it, lucked into it or grinded for years or (more likely) decades with the express aim of a payday (and you got lucky enough to get one).

thatfrenchguy 7y ago

> After all, the median (50%tile) wealth is nearly zero Median wealth in the US ~97k. It’s quite stunning one could think a society would work with the 50-percentile being zero.

cannonedhamster 7y ago
Median income in the US is much lower than 97k. It's around 65k. Median net worth is about 68k. Mean is slightly higher because the top .001 makes so much more than everyone else. It's definitely higher than zero. Not sure where your numbers came from?
- MR4D 7y ago
  According to Marketwatch [1] you are incorrect. The MEDIAN NET WORTH is $97,300. The MEAN is way higher at $692,100. Also, note that this figure varies considerably by age and education, as you might expect. [1] - https://www.nerdwallet.com/article/how-your-net-worth-compares-and-what-matters-more https://www.nerdwallet.com/article/how-your-net-worth-compar...
  - thatfrenchguy 7y ago
    Yeah, everyone knows means are lying, especially in super-unequal societies. No-one cares about the mean, you want to look at the distribution

JDiculous 7y ago

> the median (50%tile) wealth is nearly zero That sounds way more alarming than whatever the median income is. > the top income earners clearly have better lives than the low income earners, since the top income earners can consume more. The top wealth owners clearly have better lives than low wealth owners because the former don't have to work, yet make more money and pay less in taxes than everyone else. You haven't made a convincing case for why wealth shouldn't get more attention than income (or at least why it shouldn't get more attention, since the dialogue among politicians and in the media seems to exclusively focus on income despite income taxes being significantly higher than capital gains taxes).

LeftHandPath 7y ago

It also seems that the title is misrepresenting the facts. Needing more to reach the top one percent of an arbitrarily separated population should suggest that the rest of the population is also benefiting. E.g. if you needed less to join the top 1%, then it could be suggested that the gap is increasing. If you need more... well, it could just as easily follow that the bottom 99% percent have merely moved closer to the top 1%, effectively raising the bar (which, as an arbitrary point, shifts all the time anyways). That said, it could be argued the other way - but the evidence for either direction is lacking. Because the issue is being raised by people who tend to overemphasize inequality, I tend to lean the opposite direction - perhaps we should re-evaluate the way we define upper and lower class.