7 ms·

> America has a social mobility problem. Children born in 1940 had a 90% chance of earning more than their parents. For children born in 1984, the odds were 50-

by swalsh 7y ago

> America has a social mobility problem. Children born in 1940 had a 90% chance of earning more than their parents. For children born in 1984, the odds were 50-50. I think it's not unimportant to remember that Americas economic position in the world was dramatically different then. With the end of WWII, we had the Brenton Woods system, and the Marshall Plan. Those 2 systems drove economic growth, and placed America in the center of it. It was an unprecentented period of economic development worldwide, but especially so for America. The tech boom drove quite a bit of growth too, but it was narrower, and not in the same level of magnitude. The point is, 1944 - 1991 is a HIGHLY unusual economic state, and it's not reasonable to expect that the mobility that existed then should still exist today.

wonderwonder 7y ago
This ignores the fact that the current system is completely rigged to favor the rich and those with access to wealth. 1. The IRS has admitted that its to hard to audit the rich so it goes after poor people instead. 2. Its much easier to take risk if you have a safety cushion. If a rich kid takes a risk and starts a company, often with his parents capital, the worst that happens is he may have to move back in with his parents. If a less wealthy / poor person takes a risk and fails, there is a very real chance of becoming homeless or so entrenched in debt that escape is close to impossible without bankruptcy. 3. For people with no family support and who's parents did not guide them towards college, if they work 2 jobs and each of those jobs pays $15 and somehow work 40 hours a week at both, that's still only 60k a year, completely upending the argument that those who succeed do so only because they work hard. People are not going to be able to start a business, save for retirement and raise a family with that. 4. The rich can use campaign donations and lobbyists to further rig the system in their favor. This list can go on forever. I am not saying its impossible to come from nothing and gain great wealth but the odds are very much stacked against you, regardless of the amount of effort you put in.
FussyZeus 7y ago
> The point is, 1944 - 1991 is a HIGHLY unusual economic state This part I agree with. > and it's not reasonable to expect that the mobility that existed then should still exist today. This part I absolutely do not. Perhaps the social mobility wouldn't be exactly the same, but surely we can do better than the current state of affairs? I wonder how many people could be elevated to comfortable middle class status with all the money hoarded so Jeff Bezos can have over 20 different extravagant homes? And that's to say nothing for the cost of college going through the roof while conferring even less benefit to people's careers, stagnant wages, ever-rising taxes on the 99% since the IRS finds it difficult to audit the wealthy...
- rpiguy 7y ago
  Higher income taxes only protect the rich, because their wealth is largely asset, not income based. Unless you go full Marxist and seize property (assets) higher income taxes only prevent the middle class from accumulating wealth. Warren's asset tax for medicare for all is the fist serious contemplation of asset seizure that I can think of by a mainstream politician in recent memory. Similarly, massive redistribution of wealth just further divides society into givers and receivers. The elite will continue to control the government, education, and big corporations and continue locking out the receivers. In Europe, for example, the same families have been rich and in control forever, because the high income tax scheme protects them from new entrants, while their assets continue to appreciate. The middle and lower classes are supplicated through state benefits, so moving up the ladder isn't as much of a concern. By the way, I am not against high taxes and redistribution, but people should be totally aware of the trade offs being made. High taxes and redistribution are often sold as "socking it to the rich" but in reality it is the complete opposite and cements the position of the rich. I agree University reform is absolutely needed in the US. The cost is too high, we subsidize garbage degrees, rich kids benefit the most from it, grades are too subjective (because outside of engineering/medicine objective testing is racist/sexist/etc.) Kick out the legacy students that shouldn't be a factor at all.
- tachyonbeam 7y ago
  > how many people could be elevated to comfortable middle class status with all the money hoarded so Jeff Bezos can have over 20 different extravagant homes? More fundamentally: money is created through debt. Central banks print money to increase the money supply. This money is being used to buy assets to float up the stock and real estate markets. In other words, central banks are a form or corporate welfare for the rich. It doesn't have to be this way. We could print money and use it to build housing for those who can't afford it. That would also stimulate the economy. The problem is that we think of real estate as an investment, when housing is actually a fundamental need.
  - SpicyLemonZest 7y ago
    There's a sense in which it's true that central banks print money to increase the money supply. But it's not at all the case that central banks say "hey, Jeff Bezos, have some of these millions". There's no transaction where the central bank just hands people money for free.

by swalsh 7y ago

wonderwonder 7y ago

This ignores the fact that the current system is completely rigged to favor the rich and those with access to wealth. 1. The IRS has admitted that its to hard to audit the rich so it goes after poor people instead. 2. Its much easier to take risk if you have a safety cushion. If a rich kid takes a risk and starts a company, often with his parents capital, the worst that happens is he may have to move back in with his parents. If a less wealthy / poor person takes a risk and fails, there is a very real chance of becoming homeless or so entrenched in debt that escape is close to impossible without bankruptcy. 3. For people with no family support and who's parents did not guide them towards college, if they work 2 jobs and each of those jobs pays $15 and somehow work 40 hours a week at both, that's still only 60k a year, completely upending the argument that those who succeed do so only because they work hard. People are not going to be able to start a business, save for retirement and raise a family with that. 4. The rich can use campaign donations and lobbyists to further rig the system in their favor. This list can go on forever. I am not saying its impossible to come from nothing and gain great wealth but the odds are very much stacked against you, regardless of the amount of effort you put in.

FussyZeus 7y ago

> The point is, 1944 - 1991 is a HIGHLY unusual economic state This part I agree with. > and it's not reasonable to expect that the mobility that existed then should still exist today. This part I absolutely do not. Perhaps the social mobility wouldn't be exactly the same, but surely we can do better than the current state of affairs? I wonder how many people could be elevated to comfortable middle class status with all the money hoarded so Jeff Bezos can have over 20 different extravagant homes? And that's to say nothing for the cost of college going through the roof while conferring even less benefit to people's careers, stagnant wages, ever-rising taxes on the 99% since the IRS finds it difficult to audit the wealthy...

rpiguy 7y ago
Higher income taxes only protect the rich, because their wealth is largely asset, not income based. Unless you go full Marxist and seize property (assets) higher income taxes only prevent the middle class from accumulating wealth. Warren's asset tax for medicare for all is the fist serious contemplation of asset seizure that I can think of by a mainstream politician in recent memory. Similarly, massive redistribution of wealth just further divides society into givers and receivers. The elite will continue to control the government, education, and big corporations and continue locking out the receivers. In Europe, for example, the same families have been rich and in control forever, because the high income tax scheme protects them from new entrants, while their assets continue to appreciate. The middle and lower classes are supplicated through state benefits, so moving up the ladder isn't as much of a concern. By the way, I am not against high taxes and redistribution, but people should be totally aware of the trade offs being made. High taxes and redistribution are often sold as "socking it to the rich" but in reality it is the complete opposite and cements the position of the rich. I agree University reform is absolutely needed in the US. The cost is too high, we subsidize garbage degrees, rich kids benefit the most from it, grades are too subjective (because outside of engineering/medicine objective testing is racist/sexist/etc.) Kick out the legacy students that shouldn't be a factor at all.
tachyonbeam 7y ago
> how many people could be elevated to comfortable middle class status with all the money hoarded so Jeff Bezos can have over 20 different extravagant homes? More fundamentally: money is created through debt. Central banks print money to increase the money supply. This money is being used to buy assets to float up the stock and real estate markets. In other words, central banks are a form or corporate welfare for the rich. It doesn't have to be this way. We could print money and use it to build housing for those who can't afford it. That would also stimulate the economy. The problem is that we think of real estate as an investment, when housing is actually a fundamental need.
- SpicyLemonZest 7y ago
  There's a sense in which it's true that central banks print money to increase the money supply. But it's not at all the case that central banks say "hey, Jeff Bezos, have some of these millions". There's no transaction where the central bank just hands people money for free.