7 ms·

Most of Europe Is a Lot Poorer Than Most of the United States (2016)

51 points by twsttest 6y ago

gshdg 6y ago
Yeah, looking at GDP per capita rather than median income totally disregards the inequality that makes $54k/person ludicrous to describe as typical in the US.
- 1123581321 6y ago
  The US is #6 worldwide measured by median income. Luxembourg, three Nordic states and Australia outrank it. https://en.m.wikipedia.org/wiki/Median_income https://en.m.wikipedia.org/wiki/Median_income
  - mhandley 6y ago
    If you also factored in healthcare and education costs (including university), I suspect the US would rank lower than that.
    - TMWNN 6y ago
      YOu would be wrong in your suspicion. At $45,284 the US has the highest household net disposable income per capita in the OECD (http://www.oecdbetterlifeindex.org/countries/united-states/ http://www.oecdbetterlifeindex.org/countries/united-states/), where "disposable income" (http://stats.oecd.org/glossary/detail.asp?ID=46 http://stats.oecd.org/glossary/detail.asp?ID=46) accounts for healthcare and government benefits.
      - mhandley 6y ago
        That number is for mean, not median, so it rather misses the point.
        TMWNN 6y ago
        As mentioned elsewhere, the US still does quite well in median income rankings (https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income).
        mdorazio 6y ago
        Median available at [1]. US ranks #3, behind Switzerland and Norway. [1] https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income#Median https://en.wikipedia.org/wiki/Disposable_household_and_per_c...
      - deleted 6y ago
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      - pbhjpbhj 6y ago
        $3.8k per month disposable income per person?! Wow. What's the median gross income, and level of tax, that is based on?
        jandrewrogers 6y ago
        The median household income in the US is ~$64k currently. Since disposable income is net various income and social taxes, it implies an effective tax rate of 30% at the median income. This number is deceptive in that the US is geographically massive and the economies, State governments (taxes), and cultures vary widely across thousands of kilometers. The difference between the median income of the highest and lowest States is almost 2x, so your experience will be very different depending on which State you live. Also, in terms of discretionary income, cost of living varies a lot so disposable income isn't the entire story. Note that the average discretionary income (money left over after all ordinary expenses) in the US is ~$2k/month whereas the median discretionary income is $1k/month. This implies that high income earners (think $100k, not FAANG) have a few thousand dollars left over each month after expenses. I've worked in Europe for several years and the differences in discretionary income are stark, both due to income levels and taxation. Americans are kind of oblivious to just how freely they spend money due to having so much discretionary income; we tend to assume the rest of the developed world is similar when that really isn't the case.
  - sushshshsh 6y ago
    How does this account for things like taxes and shifting of expenses? It is common knowledge that in the USA, they will pay you extra in the corporate world, but that extra money goes to family health care, education, transport, and other things that are covered by European taxation schemes. If you look at discretionary income, the median corporate employees are making similar incomes. And of course, SWEs are outperforming in USA, and manual laborers are outperforming in EU
    - deleted 6y ago
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    - 1123581321 6y ago
      I have not researched that until now but it appears the US is #3 for median disposable income behind Switzerland and Norway. If there’s a better metric I’m interested. However, I think it’s safe to say the typical US resident is not relatively impoverished. https://en.m.wikipedia.org/wiki/Disposable_household_and_per_capita_income https://en.m.wikipedia.org/wiki/Disposable_household_and_per...
- harryh 6y ago
  Looking at median income doesn't significantly alter the conclusions. https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income
- nabla9 6y ago
  Usually rich and poor means net wealth, not income. Median net wealth per adult, in US dollars is relatively good measure. US is ranked 22 globally. Source: "Global wealth databook 2019" (PDF). Credit Suisse. https://www.credit-suisse.com/media/assets/corporate/docs/about-us/research/publications/global-wealth-databook-2019.pdf https://www.credit-suisse.com/media/assets/corporate/docs/ab... European countries ahead of the US: Luxembourg, Belgium, Ireland, France, UK, Spain,Austria, Italy, Malta, Norway. Interesting how many countries (France for example) is ahead of Germany in both mean and median net wealth per adult. In the US 34.5% of population has wealth between 100,000 USD and 1 million, In UK 44.8%, France: 46.3%. US has significantly more people with wealth over 1 million. German Gini index is 81.6, France 69.6. USA 85.2. EDIT: Table 3-3 is super interesting. Membership of top wealth groups for selected countries, 2019. (absolute number of people). Over USD 100,000; Number of adults (thousands) China 113,410 United States 103,198 Japan 55,370 Germany 26,012 United Kingdom 25,388 France 25,110 Italy 23,284 China already has more people with wealth over 100,000 USD. (20.8% of total) than any other country. No wonder why US companies want to stay in Chinese markets.
  - gshdg 6y ago
    And yet more than half of Americans don’t have $400 to cover an emergency. I wonder how the US would stack up in 25th percentile wealth against European countries? Also, there are measures like food insecurity that I suspect would be very telling.
    - deleted 6y ago
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    - jandrewrogers 6y ago
      Per the government, the median American household has >$1000 remaining every month after all ordinary expenses, far more than enough to cover a $400 emergency. The "can't cover $400" trope doesn't imply what you think it does, it is pulled out of context from a survey about how people would cover an emergency, not whether they could. Many popular financial stats used in the media are misleading in service of a narrative. As another example, you'll see many articles stating some large percentage of Americans don't have any savings, which is only true because they define "savings" as having a savings account, which many Americans with plenty of money don't even have (myself included). And then there is the one about Americans having no retirement savings, where "retirement savings" excludes any real estate investments, taxable brokerage accounts, etc which is where many Americans have the majority of their retirement savings. The "food insecurity" surveys are a similar story. Same with "food deserts". If you dig into the underlying studies none of them imply what the media tries to imply with them. It is a hazard to uncritically accept statistics from the media. They have an incentive to paint the most dire story possible.
- rst 6y ago
  And even looking at median income would still leave other things out -- like the much higher fraction of that household income which goes to medical expenses in the US than in, well... the entire EU for starters.
  - TMWNN 6y ago
    No. At $45,284 the US has the highest household net disposable income per capita in the OECD (http://www.oecdbetterlifeindex.org/countries/united-states/ http://www.oecdbetterlifeindex.org/countries/united-states/), where "disposable income" (http://stats.oecd.org/glossary/detail.asp?ID=46 http://stats.oecd.org/glossary/detail.asp?ID=46) accounts for healthcare and government benefits.
    - chmod775 6y ago
      That's an average again. Also not sure what you mean by "No." That data neither proves nor disproves what your parent comment said. Additionally disposable income doesn't account for "optional" spending on healthcare etc. by the individual. When you look at median disposable household income, the US still comes in somewhere at the top, but the top 15 countries all have about the same ballpark figure (~30k USD), with US being the only country among them that doesn't have unemployment benefits, affordable healthcare, etc. https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income#Median https://en.wikipedia.org/wiki/Disposable_household_and_per_c...
      - TMWNN 6y ago
        As mentioned elsewhere, the US still does quite well in median income rankings (https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income).
        chmod775 6y ago
        Is there any particular point you're trying to make? You keep responding to people with at best tangentially related data that is not relevant to the discussion. Now suddenly we're looking at median gross income. And this time I don't know at all how to respond to that in a manner that will somehow make it relevant to the discussion again.
- defertoreptar 6y ago
  The author is looking at consumption, not income. It's been shown that when you look at consumption, inequality isn't nearly what people think. https://economics21.org/html/when-it-comes-inequality-consumption-what-matters-978.html https://economics21.org/html/when-it-comes-inequality-consum...
  - standardUser 6y ago
    Doesn't focusing on consumption completely obscure to bulk of inequality, which takes the form of endless billions constantly accumulating among a minuscule portion of the population?
- amiga_500 6y ago
  Even per capita is misleading. Go to get stitches in the eu vs america. Buy a regular pizza in the eu, get quality, buy it in the usa get synthetic yuk.
- LargeWu 6y ago
  Indeed. Don't be fooled by North Dakota as the top GDP per capita state in the US. There are a relatively small number of landowners in the western half of the state making crazy passive income from oil rights their great-grandfathers lucked into when they immigrated a hundred years ago. The state is very working-class. It maybe doesn't have the same amount of abject poverty that you see in other places, but people here work hard for a living. Also, the numbers in the article are from 2014 when the oil boom was in still full swing. That's what provided a lot of the highest paying jobs in the state. Drilling levels today are less than 10% of what they were at the peak, and consequently many of those jobs have gone with it.
op00to 6y ago
It’s almost as if you don’t need to be filthy rich, standing on the shoulders of the poor like in America to have an acceptable quality of life in Europe due to social programs that make sure everyone has what they need.
- bromuro 6y ago
  When i was living in italy, most of my local friends were “poor” (no money) but they had everything they need - they were not even trying to become richer. A different idea of “personal success”, i guessed.
galuggus 6y ago
What about health care costs? A big difference in much of the eu is that a health emergency won't bankrupt you.
- PragmaticPulp 6y ago
  I fully agree that we need to fix health care for the uninsured and underinsured in the United States. However, do you ever wonder why so many Americans aren’t voting for socialized healthcare? In reality, most of us aren’t at risk of going bankrupt from a health care emergency. Again, I fully agree that too many people are at risk of going bankrupt from a healthcare emergency, but it’s not the norm for the average American like you might read online. The United States does actually have government health care programs for low income and disable people (Medicaid, covers approximately 23% of the US population) and for elderly (Medicare, covers people 65 and over). We also have government subsidies for lower income people (up to 400% of the federal poverty level) who need to buy their own health care plans through the marketplace. Again, it’s not perfect and I agree that improvements are necessary, but the reality of the situation is a bit different than many of the reductionist comments you read online. When you’re earning 2x or even 3x as much as European counterparts (using my real-world experience managing international remote teams), paying the health insurance premiums doesn’t feel like as much of an inconvenience. In my case, my employer pays my premiums and my out of pocket maximum spending is capped at $1000 per year, worst case.
  - chrismatheson 6y ago
    But most of Europe aren’t spending 20-30% of their income on healthcare. If you take that into account I wonder how these numbers stack up
    - PragmaticPulp 6y ago
      Neither are Americans. I think you have some flawed numbers: https://www.cnbc.com/2019/10/09/americans-spend-twice-as-much-on-health-care-today-as-in-the-1980s.html https://www.cnbc.com/2019/10/09/americans-spend-twice-as-muc... The average American spends about $5000 on healthcare per year. That’s only 20-30% if your income is $15,000 per year. If you’re making $100K per year or more (median SWE compensation) or even $200K or more (upper end SWE compensation) then it’s really not a big deal. EDIT: This is why I loathe discussions about politics ok HN. Would appreciate some responses rather than downvotes for citing the corrected numbers.
kolinko 6y ago
There is so much wrong with this article. First of all, a lot of the "yellow" areas in the post-soviet block, that were catching up in the past 30 years. The standards of living are increasing there every year. Secondly - GDP is the weirdest metric possible to measure the quality of life. Even purchasing power index is not as good, because it ignores the things that the government gives for semi-free. Growing in one of the poorest Polish regions, me and my friends' families could buy fewer iPhones, and cars were a distant dream, but we had free public education, free healthcare, cheap but decent housing, and the public transit. I wonder if the post's author has actually been to any of the poor European regions - even comparing them with rich US, they look seriously decent.
cs702 6y ago
This is a highly opinionated piece that selectively uses a tiny bit of data while ignoring a ton of inconvenient data to make a persuasive argument that does not stand up even to mild scrutiny. It is cleverly disguised as objective research. In other words, this is political propaganda of the highest quality. I mean that as a compliment. It doesn't belong on HN. I flagged it.
- locacorten 6y ago
  It might be flawed, wrong, stupid, etc. but that’s not a reason to flag it. Argue against, bring more light into the discussion. Censoring it brings no good. Censorship should be rarely and carefully used.
  - cs702 6y ago
    It was NOT intended as "censorship." According to the HN guidelines, as I understand them, this kind of writing simply does not belong on HN. As I wrote above, that's why I flagged it. Please don't attack a straw-man. For reference, see https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
kstenerud 6y ago
I've lived and worked in Canada, USA, UK, Japan, and Germany. I've also done a fair bit of traveling. Yes, on a per-capita GDP basis, the USA is technically "ahead", but when it comes to daily living, it's FAR behind. During my 6 years in the USA, I saw roads falling apart, terrible infrastructure, litter everywhere, crime and poverty the likes I've never seen outside of third world countries. The only thing even close to the USA was urban UK, which (other than parts of Southern Europe and Paris) is probably the dirtiest of the Western European countries. But even they weren't as bad as the USA. (Bear in mind I lived in the UK in the late 90s. Things may have changed since then) Put simply, the quality of life in America was FAR worse than any other country I've lived in. The consumption index is also not the greatest measure, since it has a lot to do with consumer attitudes & materialism, which are different in most of the world compared to America and Japan (I've never seen materialistic attitudes as strong as there). After moving to Germany, I have no desire to live elsewhere.
- rmellow 6y ago
  As someone in tech who chose to grow their career in Canada instead of the US (where I could easily make double), I very much appreciate your comment. I still haven't discarded the possibility to move to Europe, as there are aspects of the lifestyle here that I have a hard time getting used to. Comes to mind: the high amount of drug users and mentally ill people screaming on the streets, completely ignored by the state. Are there any metrics for quality of life that take into account happiness?
  - kstenerud 6y ago
    Hmm, this site might help: https://www.theearthawaits.com/ https://www.theearthawaits.com/ Generally, you want to live in a place with a low disparity between rich and poor. They'll usually have lower crime, lower social problems, better maintained infrastructure, lower corruption, better culture. Scandinavia is probably the best you can get, if you don't mind the cold ;-)
- david38 6y ago
  America is a really really big country. What parts were you talking about? The wealth diversity even within say, California or even Virginia, hell even a tiny state like New Jersey is enormous. In no places I’ve ever lived has infrastructure been a problem. Crime has been a slight problem, but not much.
jeroenhd 6y ago
I have my doubts about some of the statistics in this article (Groningen the number 6 wealthiest place in Europe? I'm not so sure about that) but I can't deny that wages and freely expendable income in the US are much higher than most of Europe. However, with the work ethic and the hours many US workers pull to maintain those standards, I'm not so sure if I'd want Europe to move towards the rich American standard. From a rich man's perspective, which many of HN's readers are very likely to know because this crowd is seemingly highly educated or intelligent through their own pursuit, the US does allow for a better standard of living than most of Europe. The wages are higher, the taxes are often loert and there's better access to luxury items. However, in pursuit of happiness, I'd prefer less work and more free time to enjoy the fruits of my labour over amassing wealth. Having access to expensive laptops instead of needing to cheap out is nice, but what's the point if you barely have time to enjoy your purchase? There's also the perspective of poor, uneducated people. In a lot of cases I'd much rather be jobless or stuck in uneducated labour in Europe than in the US with the Labour rights situation in a lot of states. The right to work system means you have a lot more power if your boss depends on your skill, but if you don't have any unique skills or can't sell them, the same power can be turned against you to limit your options. The employee-oriented labour protection a large part of Europe enjoys is worth more to me than he ability to get a raise or leave for another employee tomorrow. I wonder what this article would look like if it weren't written by an economist, but rather by someone researching general happiness. I'll take poor and happy over being rich and unhappy any time, and wealth can only add so much to your hapiness.
throw0101a 6y ago
A comparison of GDP per capita per hour worked: * https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_hour_worked https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)... Many EU countries are with-in 80-90% of the US by this measure. Also, the US, nationally- / federally-speaking, has no mandatory annual leave; countries in the EU have many days, and people tend take them: * https://en.wikipedia.org/wiki/List_of_minimum_annual_leave_by_country https://en.wikipedia.org/wiki/List_of_minimum_annual_leave_b... Further, using OECD data on labour productivity, the US is down the list, so it seems that when Europeans are working, they get more done: > GDP per hour worked is a measure of labour productivity. It measures how efficiently labour input is combined with other factors of production and used in the production process. * https://data.oecd.org/lprdty/gdp-per-hour-worked.htm https://data.oecd.org/lprdty/gdp-per-hour-worked.htm And let's not forget that these per capita numbers are averages: * https://en.wikipedia.org/wiki/List_of_countries_by_income_equality https://en.wikipedia.org/wiki/List_of_countries_by_income_eq... And from the article: > I’m simply making the modest — yet important — argument that Europeans would be more prosperous if the fiscal burden of government wasn’t so onerous. That does not necessarily follow. Given that in capitalism the 'excess' value created goes to Capital and not Labour, it is debatable whether Joe the Plumber or Jacques the Baker would see more money in their pockets.
- uniqueid 6y ago
  I searched the page for "health" and "med" and could not find any mention. Then I looked up "Foundation for Economic Education" on wikipedia, and understood why: it's a libertarian think tank. To factor in healthcare would weaken their message.
new2628 6y ago
Having lived all over Europe and US for varying amounts of time, this is true. Yet, the subjective quality of life is higher in most of Europe than in most of the US. Funnily, this is true within Europe as well. Most of Northern Europe is richer than most of Southern Europe. Yet, the subjective quality of life is by and large higher in the south. (This last part is my opinion, take it with a grain of salt.)
- abnry 6y ago
  And if you read the comments here, you'd think the subjective quality of life in the US is lower than in Europe.
  - benjohnson 6y ago
    I think it really depends on what you appreciate in your life. Europe is better for a stroll down to the pub to grab a pint with friends and then going to a museum . America is better for using some snow-mobiles with friends and driving around in a fancy car. As an American, there's some things that I just couldn't do in Europe: I'm making my own aluminum plane and learning to fly it. That's basically impossible in Europe.
    - new2628 6y ago
      More so in Eastern Europe -- the other day there was an article about an entire bootleg helicopter factory in Moldova.
aww_dang 6y ago
Here's a well known site that promotes free-market ideals. Unlike the other one, fee.org has not been shadow-banned.
anonymfus 6y ago
The argument in this article is double stupid. The obvious reason why it's stupid (economic metrics vs quality of life metrics) is already pointed out by other comments. The not so obvious one is that the article compares current metrics but to really compare effect of the policies on the economics you need a long term measures of change because European countries and USA obviously had a very different starting places cos WW2 and USSR collapse.
toberoni 6y ago
This looks like a heavily opinionated article with a questionable use of data. Others have mentioned the lacking focus on inequality already, so I want to add some other points: While European countries have lower GDPs, their citizens work less hours than Americans[1] and spend less on health care[2] while having similar or longer life expectancies. Privatized education might similarly inflate GDP numbers without improving the actual quality of life. The author - funnily enough a specialist for tax competition and board member of the Cayman Financial Review - is way too eager to draw political council from this apples to oranges comparison. [1] https://en.wikipedia.org/wiki/Working_time https://en.wikipedia.org/wiki/Working_time [2] https://data.worldbank.org/indicator/SH.XPD.CHEX.GD.ZS https://data.worldbank.org/indicator/SH.XPD.CHEX.GD.ZS
- Jdam 6y ago
  Literally any discussion about EU vs US: „But what about healthcare??“ Disclaimer: I’m European.
  - muro 6y ago
    If you can afford it, it's very good in the US.
    - rebolek 6y ago
      If you can afford to have same living standards as poor Europeans, it's pretty good in the US.
- 0xy 6y ago
  Speaking in the very narrow view of tech, if you work in tech in the US you are likely to make anywhere from 2 to 5 times as much as in Europe, including taxes and healthcare costs. There simply is no comparison. Switzerland comes second, with the UK or Canada next. Europeans always mention free healthcare. But when your salary in the US is triple before taxes then the healthcare costs are irrelevant. The absolute truth is that by choosing to work in Europe rather than the US, you're losing potentially millions of dollars by time you reach retirement (with compounding interest investments) -- as an average individual contributor. If you're a high performer, you might lose far more than that. Entry level grads in the US can in some cases be paid more than senior developers in the EU.
tluyben2 6y ago
Most people in my village are making around E500/month and they are pretty happy ; is that possible anywhere in the US? I think that would explain something; it's basically that people can afford to live happily because the things that really matter are from the gov. Public transport, healthcare and food if you really cannot pay for it (500 is enough actually to get to restaurants here a few time per month and a drink at the bar daily). But if something goes wrong (fridge breaks etc), you don't end up under a bridge.
jinushaun 6y ago
Sweden and South Korea are poorer than Mississippi? This article really bad.
superjan 6y ago
It is no news that average income is higher in the US, compared to Europe. The point of social safety nets is not to improve your gross national product, but to reduce poverty.
bane 6y ago
Average is a difficult measure to use in isolation. Gini also has to be considered. While the average income (even figuring in PPP) in say, Czech Republic, is far lower than in the U.S., the poorest people in the U.S. are far poorer.
mping 6y ago
If you said to me: you are gonna die and reborn, no guarantees about what your life will be in terms of health, education, personal wealth or personality traits, in which country do you want to be born? Most probably not the US for me.

51 points by twsttest 6y ago

Yeah, looking at GDP per capita rather than median income totally disregards the inequality that makes $54k/person ludicrous to describe as typical in the US.

1123581321 6y ago
The US is #6 worldwide measured by median income. Luxembourg, three Nordic states and Australia outrank it. https://en.m.wikipedia.org/wiki/Median_income https://en.m.wikipedia.org/wiki/Median_income
- mhandley 6y ago
  If you also factored in healthcare and education costs (including university), I suspect the US would rank lower than that.
  - TMWNN 6y ago
    YOu would be wrong in your suspicion. At $45,284 the US has the highest household net disposable income per capita in the OECD (http://www.oecdbetterlifeindex.org/countries/united-states/ http://www.oecdbetterlifeindex.org/countries/united-states/), where "disposable income" (http://stats.oecd.org/glossary/detail.asp?ID=46 http://stats.oecd.org/glossary/detail.asp?ID=46) accounts for healthcare and government benefits.
    - mhandley 6y ago
      That number is for mean, not median, so it rather misses the point.
      - TMWNN 6y ago
        As mentioned elsewhere, the US still does quite well in median income rankings (https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income).
      - mdorazio 6y ago
        Median available at [1]. US ranks #3, behind Switzerland and Norway. [1] https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income#Median https://en.wikipedia.org/wiki/Disposable_household_and_per_c...
    - deleted 6y ago
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    - pbhjpbhj 6y ago
      $3.8k per month disposable income per person?! Wow. What's the median gross income, and level of tax, that is based on?
      - jandrewrogers 6y ago
        The median household income in the US is ~$64k currently. Since disposable income is net various income and social taxes, it implies an effective tax rate of 30% at the median income. This number is deceptive in that the US is geographically massive and the economies, State governments (taxes), and cultures vary widely across thousands of kilometers. The difference between the median income of the highest and lowest States is almost 2x, so your experience will be very different depending on which State you live. Also, in terms of discretionary income, cost of living varies a lot so disposable income isn't the entire story. Note that the average discretionary income (money left over after all ordinary expenses) in the US is ~$2k/month whereas the median discretionary income is $1k/month. This implies that high income earners (think $100k, not FAANG) have a few thousand dollars left over each month after expenses. I've worked in Europe for several years and the differences in discretionary income are stark, both due to income levels and taxation. Americans are kind of oblivious to just how freely they spend money due to having so much discretionary income; we tend to assume the rest of the developed world is similar when that really isn't the case.
- sushshshsh 6y ago
  How does this account for things like taxes and shifting of expenses? It is common knowledge that in the USA, they will pay you extra in the corporate world, but that extra money goes to family health care, education, transport, and other things that are covered by European taxation schemes. If you look at discretionary income, the median corporate employees are making similar incomes. And of course, SWEs are outperforming in USA, and manual laborers are outperforming in EU
  - deleted 6y ago
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  - 1123581321 6y ago
    I have not researched that until now but it appears the US is #3 for median disposable income behind Switzerland and Norway. If there’s a better metric I’m interested. However, I think it’s safe to say the typical US resident is not relatively impoverished. https://en.m.wikipedia.org/wiki/Disposable_household_and_per_capita_income https://en.m.wikipedia.org/wiki/Disposable_household_and_per...
harryh 6y ago
Looking at median income doesn't significantly alter the conclusions. https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income
nabla9 6y ago
Usually rich and poor means net wealth, not income. Median net wealth per adult, in US dollars is relatively good measure. US is ranked 22 globally. Source: "Global wealth databook 2019" (PDF). Credit Suisse. https://www.credit-suisse.com/media/assets/corporate/docs/about-us/research/publications/global-wealth-databook-2019.pdf https://www.credit-suisse.com/media/assets/corporate/docs/ab... European countries ahead of the US: Luxembourg, Belgium, Ireland, France, UK, Spain,Austria, Italy, Malta, Norway. Interesting how many countries (France for example) is ahead of Germany in both mean and median net wealth per adult. In the US 34.5% of population has wealth between 100,000 USD and 1 million, In UK 44.8%, France: 46.3%. US has significantly more people with wealth over 1 million. German Gini index is 81.6, France 69.6. USA 85.2. EDIT: Table 3-3 is super interesting. Membership of top wealth groups for selected countries, 2019. (absolute number of people). Over USD 100,000; Number of adults (thousands) China 113,410 United States 103,198 Japan 55,370 Germany 26,012 United Kingdom 25,388 France 25,110 Italy 23,284 China already has more people with wealth over 100,000 USD. (20.8% of total) than any other country. No wonder why US companies want to stay in Chinese markets.
- gshdg 6y ago
  And yet more than half of Americans don’t have $400 to cover an emergency. I wonder how the US would stack up in 25th percentile wealth against European countries? Also, there are measures like food insecurity that I suspect would be very telling.
  - deleted 6y ago
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  - jandrewrogers 6y ago
    Per the government, the median American household has >$1000 remaining every month after all ordinary expenses, far more than enough to cover a $400 emergency. The "can't cover $400" trope doesn't imply what you think it does, it is pulled out of context from a survey about how people would cover an emergency, not whether they could. Many popular financial stats used in the media are misleading in service of a narrative. As another example, you'll see many articles stating some large percentage of Americans don't have any savings, which is only true because they define "savings" as having a savings account, which many Americans with plenty of money don't even have (myself included). And then there is the one about Americans having no retirement savings, where "retirement savings" excludes any real estate investments, taxable brokerage accounts, etc which is where many Americans have the majority of their retirement savings. The "food insecurity" surveys are a similar story. Same with "food deserts". If you dig into the underlying studies none of them imply what the media tries to imply with them. It is a hazard to uncritically accept statistics from the media. They have an incentive to paint the most dire story possible.
rst 6y ago
And even looking at median income would still leave other things out -- like the much higher fraction of that household income which goes to medical expenses in the US than in, well... the entire EU for starters.
- TMWNN 6y ago
  No. At $45,284 the US has the highest household net disposable income per capita in the OECD (http://www.oecdbetterlifeindex.org/countries/united-states/ http://www.oecdbetterlifeindex.org/countries/united-states/), where "disposable income" (http://stats.oecd.org/glossary/detail.asp?ID=46 http://stats.oecd.org/glossary/detail.asp?ID=46) accounts for healthcare and government benefits.
  - chmod775 6y ago
    That's an average again. Also not sure what you mean by "No." That data neither proves nor disproves what your parent comment said. Additionally disposable income doesn't account for "optional" spending on healthcare etc. by the individual. When you look at median disposable household income, the US still comes in somewhere at the top, but the top 15 countries all have about the same ballpark figure (~30k USD), with US being the only country among them that doesn't have unemployment benefits, affordable healthcare, etc. https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income#Median https://en.wikipedia.org/wiki/Disposable_household_and_per_c...
    - TMWNN 6y ago
      As mentioned elsewhere, the US still does quite well in median income rankings (https://en.wikipedia.org/wiki/Median_income https://en.wikipedia.org/wiki/Median_income).
      - chmod775 6y ago
        Is there any particular point you're trying to make? You keep responding to people with at best tangentially related data that is not relevant to the discussion. Now suddenly we're looking at median gross income. And this time I don't know at all how to respond to that in a manner that will somehow make it relevant to the discussion again.
defertoreptar 6y ago
The author is looking at consumption, not income. It's been shown that when you look at consumption, inequality isn't nearly what people think. https://economics21.org/html/when-it-comes-inequality-consumption-what-matters-978.html https://economics21.org/html/when-it-comes-inequality-consum...
- standardUser 6y ago
  Doesn't focusing on consumption completely obscure to bulk of inequality, which takes the form of endless billions constantly accumulating among a minuscule portion of the population?
amiga_500 6y ago
Even per capita is misleading. Go to get stitches in the eu vs america. Buy a regular pizza in the eu, get quality, buy it in the usa get synthetic yuk.
LargeWu 6y ago
Indeed. Don't be fooled by North Dakota as the top GDP per capita state in the US. There are a relatively small number of landowners in the western half of the state making crazy passive income from oil rights their great-grandfathers lucked into when they immigrated a hundred years ago. The state is very working-class. It maybe doesn't have the same amount of abject poverty that you see in other places, but people here work hard for a living. Also, the numbers in the article are from 2014 when the oil boom was in still full swing. That's what provided a lot of the highest paying jobs in the state. Drilling levels today are less than 10% of what they were at the peak, and consequently many of those jobs have gone with it.

op00to 6y ago

It’s almost as if you don’t need to be filthy rich, standing on the shoulders of the poor like in America to have an acceptable quality of life in Europe due to social programs that make sure everyone has what they need.

bromuro 6y ago
When i was living in italy, most of my local friends were “poor” (no money) but they had everything they need - they were not even trying to become richer. A different idea of “personal success”, i guessed.

galuggus 6y ago

What about health care costs? A big difference in much of the eu is that a health emergency won't bankrupt you.

PragmaticPulp 6y ago
I fully agree that we need to fix health care for the uninsured and underinsured in the United States. However, do you ever wonder why so many Americans aren’t voting for socialized healthcare? In reality, most of us aren’t at risk of going bankrupt from a health care emergency. Again, I fully agree that too many people are at risk of going bankrupt from a healthcare emergency, but it’s not the norm for the average American like you might read online. The United States does actually have government health care programs for low income and disable people (Medicaid, covers approximately 23% of the US population) and for elderly (Medicare, covers people 65 and over). We also have government subsidies for lower income people (up to 400% of the federal poverty level) who need to buy their own health care plans through the marketplace. Again, it’s not perfect and I agree that improvements are necessary, but the reality of the situation is a bit different than many of the reductionist comments you read online. When you’re earning 2x or even 3x as much as European counterparts (using my real-world experience managing international remote teams), paying the health insurance premiums doesn’t feel like as much of an inconvenience. In my case, my employer pays my premiums and my out of pocket maximum spending is capped at $1000 per year, worst case.
- chrismatheson 6y ago
  But most of Europe aren’t spending 20-30% of their income on healthcare. If you take that into account I wonder how these numbers stack up
  - PragmaticPulp 6y ago
    Neither are Americans. I think you have some flawed numbers: https://www.cnbc.com/2019/10/09/americans-spend-twice-as-much-on-health-care-today-as-in-the-1980s.html https://www.cnbc.com/2019/10/09/americans-spend-twice-as-muc... The average American spends about $5000 on healthcare per year. That’s only 20-30% if your income is $15,000 per year. If you’re making $100K per year or more (median SWE compensation) or even $200K or more (upper end SWE compensation) then it’s really not a big deal. EDIT: This is why I loathe discussions about politics ok HN. Would appreciate some responses rather than downvotes for citing the corrected numbers.

kolinko 6y ago

There is so much wrong with this article. First of all, a lot of the "yellow" areas in the post-soviet block, that were catching up in the past 30 years. The standards of living are increasing there every year. Secondly - GDP is the weirdest metric possible to measure the quality of life. Even purchasing power index is not as good, because it ignores the things that the government gives for semi-free. Growing in one of the poorest Polish regions, me and my friends' families could buy fewer iPhones, and cars were a distant dream, but we had free public education, free healthcare, cheap but decent housing, and the public transit. I wonder if the post's author has actually been to any of the poor European regions - even comparing them with rich US, they look seriously decent.

cs702 6y ago

This is a highly opinionated piece that selectively uses a tiny bit of data while ignoring a ton of inconvenient data to make a persuasive argument that does not stand up even to mild scrutiny. It is cleverly disguised as objective research. In other words, this is political propaganda of the highest quality. I mean that as a compliment. It doesn't belong on HN. I flagged it.

locacorten 6y ago
It might be flawed, wrong, stupid, etc. but that’s not a reason to flag it. Argue against, bring more light into the discussion. Censoring it brings no good. Censorship should be rarely and carefully used.
- cs702 6y ago
  It was NOT intended as "censorship." According to the HN guidelines, as I understand them, this kind of writing simply does not belong on HN. As I wrote above, that's why I flagged it. Please don't attack a straw-man. For reference, see https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

kstenerud 6y ago

I've lived and worked in Canada, USA, UK, Japan, and Germany. I've also done a fair bit of traveling. Yes, on a per-capita GDP basis, the USA is technically "ahead", but when it comes to daily living, it's FAR behind. During my 6 years in the USA, I saw roads falling apart, terrible infrastructure, litter everywhere, crime and poverty the likes I've never seen outside of third world countries. The only thing even close to the USA was urban UK, which (other than parts of Southern Europe and Paris) is probably the dirtiest of the Western European countries. But even they weren't as bad as the USA. (Bear in mind I lived in the UK in the late 90s. Things may have changed since then) Put simply, the quality of life in America was FAR worse than any other country I've lived in. The consumption index is also not the greatest measure, since it has a lot to do with consumer attitudes & materialism, which are different in most of the world compared to America and Japan (I've never seen materialistic attitudes as strong as there). After moving to Germany, I have no desire to live elsewhere.

rmellow 6y ago
As someone in tech who chose to grow their career in Canada instead of the US (where I could easily make double), I very much appreciate your comment. I still haven't discarded the possibility to move to Europe, as there are aspects of the lifestyle here that I have a hard time getting used to. Comes to mind: the high amount of drug users and mentally ill people screaming on the streets, completely ignored by the state. Are there any metrics for quality of life that take into account happiness?
- kstenerud 6y ago
  Hmm, this site might help: https://www.theearthawaits.com/ https://www.theearthawaits.com/ Generally, you want to live in a place with a low disparity between rich and poor. They'll usually have lower crime, lower social problems, better maintained infrastructure, lower corruption, better culture. Scandinavia is probably the best you can get, if you don't mind the cold ;-)
david38 6y ago
America is a really really big country. What parts were you talking about? The wealth diversity even within say, California or even Virginia, hell even a tiny state like New Jersey is enormous. In no places I’ve ever lived has infrastructure been a problem. Crime has been a slight problem, but not much.

jeroenhd 6y ago

I have my doubts about some of the statistics in this article (Groningen the number 6 wealthiest place in Europe? I'm not so sure about that) but I can't deny that wages and freely expendable income in the US are much higher than most of Europe. However, with the work ethic and the hours many US workers pull to maintain those standards, I'm not so sure if I'd want Europe to move towards the rich American standard. From a rich man's perspective, which many of HN's readers are very likely to know because this crowd is seemingly highly educated or intelligent through their own pursuit, the US does allow for a better standard of living than most of Europe. The wages are higher, the taxes are often loert and there's better access to luxury items. However, in pursuit of happiness, I'd prefer less work and more free time to enjoy the fruits of my labour over amassing wealth. Having access to expensive laptops instead of needing to cheap out is nice, but what's the point if you barely have time to enjoy your purchase? There's also the perspective of poor, uneducated people. In a lot of cases I'd much rather be jobless or stuck in uneducated labour in Europe than in the US with the Labour rights situation in a lot of states. The right to work system means you have a lot more power if your boss depends on your skill, but if you don't have any unique skills or can't sell them, the same power can be turned against you to limit your options. The employee-oriented labour protection a large part of Europe enjoys is worth more to me than he ability to get a raise or leave for another employee tomorrow. I wonder what this article would look like if it weren't written by an economist, but rather by someone researching general happiness. I'll take poor and happy over being rich and unhappy any time, and wealth can only add so much to your hapiness.

throw0101a 6y ago

A comparison of GDP per capita per hour worked: * https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_hour_worked https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)... Many EU countries are with-in 80-90% of the US by this measure. Also, the US, nationally- / federally-speaking, has no mandatory annual leave; countries in the EU have many days, and people tend take them: * https://en.wikipedia.org/wiki/List_of_minimum_annual_leave_by_country https://en.wikipedia.org/wiki/List_of_minimum_annual_leave_b... Further, using OECD data on labour productivity, the US is down the list, so it seems that when Europeans are working, they get more done: > GDP per hour worked is a measure of labour productivity. It measures how efficiently labour input is combined with other factors of production and used in the production process. * https://data.oecd.org/lprdty/gdp-per-hour-worked.htm https://data.oecd.org/lprdty/gdp-per-hour-worked.htm And let's not forget that these per capita numbers are averages: * https://en.wikipedia.org/wiki/List_of_countries_by_income_equality https://en.wikipedia.org/wiki/List_of_countries_by_income_eq... And from the article: > I’m simply making the modest — yet important — argument that Europeans would be more prosperous if the fiscal burden of government wasn’t so onerous. That does not necessarily follow. Given that in capitalism the 'excess' value created goes to Capital and not Labour, it is debatable whether Joe the Plumber or Jacques the Baker would see more money in their pockets.

uniqueid 6y ago
I searched the page for "health" and "med" and could not find any mention. Then I looked up "Foundation for Economic Education" on wikipedia, and understood why: it's a libertarian think tank. To factor in healthcare would weaken their message.

new2628 6y ago

Having lived all over Europe and US for varying amounts of time, this is true. Yet, the subjective quality of life is higher in most of Europe than in most of the US. Funnily, this is true within Europe as well. Most of Northern Europe is richer than most of Southern Europe. Yet, the subjective quality of life is by and large higher in the south. (This last part is my opinion, take it with a grain of salt.)

abnry 6y ago
And if you read the comments here, you'd think the subjective quality of life in the US is lower than in Europe.
- benjohnson 6y ago
  I think it really depends on what you appreciate in your life. Europe is better for a stroll down to the pub to grab a pint with friends and then going to a museum . America is better for using some snow-mobiles with friends and driving around in a fancy car. As an American, there's some things that I just couldn't do in Europe: I'm making my own aluminum plane and learning to fly it. That's basically impossible in Europe.
  - new2628 6y ago
    More so in Eastern Europe -- the other day there was an article about an entire bootleg helicopter factory in Moldova.

aww_dang 6y ago

Here's a well known site that promotes free-market ideals. Unlike the other one, fee.org has not been shadow-banned.

anonymfus 6y ago

The argument in this article is double stupid. The obvious reason why it's stupid (economic metrics vs quality of life metrics) is already pointed out by other comments. The not so obvious one is that the article compares current metrics but to really compare effect of the policies on the economics you need a long term measures of change because European countries and USA obviously had a very different starting places cos WW2 and USSR collapse.

toberoni 6y ago

This looks like a heavily opinionated article with a questionable use of data. Others have mentioned the lacking focus on inequality already, so I want to add some other points: While European countries have lower GDPs, their citizens work less hours than Americans[1] and spend less on health care[2] while having similar or longer life expectancies. Privatized education might similarly inflate GDP numbers without improving the actual quality of life. The author - funnily enough a specialist for tax competition and board member of the Cayman Financial Review - is way too eager to draw political council from this apples to oranges comparison. [1] https://en.wikipedia.org/wiki/Working_time https://en.wikipedia.org/wiki/Working_time [2] https://data.worldbank.org/indicator/SH.XPD.CHEX.GD.ZS https://data.worldbank.org/indicator/SH.XPD.CHEX.GD.ZS

Jdam 6y ago
Literally any discussion about EU vs US: „But what about healthcare??“ Disclaimer: I’m European.
- muro 6y ago
  If you can afford it, it's very good in the US.
  - rebolek 6y ago
    If you can afford to have same living standards as poor Europeans, it's pretty good in the US.
0xy 6y ago
Speaking in the very narrow view of tech, if you work in tech in the US you are likely to make anywhere from 2 to 5 times as much as in Europe, including taxes and healthcare costs. There simply is no comparison. Switzerland comes second, with the UK or Canada next. Europeans always mention free healthcare. But when your salary in the US is triple before taxes then the healthcare costs are irrelevant. The absolute truth is that by choosing to work in Europe rather than the US, you're losing potentially millions of dollars by time you reach retirement (with compounding interest investments) -- as an average individual contributor. If you're a high performer, you might lose far more than that. Entry level grads in the US can in some cases be paid more than senior developers in the EU.

tluyben2 6y ago

Most people in my village are making around E500/month and they are pretty happy ; is that possible anywhere in the US? I think that would explain something; it's basically that people can afford to live happily because the things that really matter are from the gov. Public transport, healthcare and food if you really cannot pay for it (500 is enough actually to get to restaurants here a few time per month and a drink at the bar daily). But if something goes wrong (fridge breaks etc), you don't end up under a bridge.

jinushaun 6y ago

Sweden and South Korea are poorer than Mississippi? This article really bad.

superjan 6y ago

It is no news that average income is higher in the US, compared to Europe. The point of social safety nets is not to improve your gross national product, but to reduce poverty.

bane 6y ago

Average is a difficult measure to use in isolation. Gini also has to be considered. While the average income (even figuring in PPP) in say, Czech Republic, is far lower than in the U.S., the poorest people in the U.S. are far poorer.

mping 6y ago

If you said to me: you are gonna die and reborn, no guarantees about what your life will be in terms of health, education, personal wealth or personality traits, in which country do you want to be born? Most probably not the US for me.