7 ms·

"It is a sad and little-known reality that poverty tends to persist between generations". Is it? To me it's intuitively obvious and I can't think of any real p

"It is a sad and little-known reality that poverty tends to persist between generations". Is it? To me it's intuitively obvious and I can't think of any real person who would disagree? I can't even conceive of a different way this could work. Reducing the correlation to zero would require basically removing money's functional utility.

jokoon 5y ago
Most people, particularly in the west, believe that merit can be acquired, "just do it", "self made man", free will etc. Liberal economics are surrounded with those kinds of ideals that always explain that the poor deserve their status, that they only have themselves to blame.
- throwaway55421 5y ago
  The statements are not symmetrical, though. Let's use the less emotionally charged example of the gym rat. An individual who sets out with the goal and drive to become strong can be successful with high probability. But not everyone will do that. Most will give up or just not even bother in the first place.
  - jokoon 5y ago
    It improves the probability, but it's not a requirement, and sometimes it doesn't increase the probability at all.
    - throwaway55421 5y ago
      I mean, sure, if we want to abandon the concept of cause and effect entirely because John went to the gym and ... got hit by a bus on the way, oops.
nerdponx 5y ago
Perhaps "little-acknowledged-by-politicians" is more apt.
- vaidhy 5y ago
  Probably, not just by politicians, but also from everyone who strongly believes is pulling themselves by bootstraps.
Animats 5y ago
Sweden does it. It takes about a 30-35% tax rate.[1] Nigeria is a poor country which still has a high birth rate. Outside of Africa, almost all countries are past that. Even China and India. [1] https://borgenproject.org/poverty-in-sweden/ https://borgenproject.org/poverty-in-sweden/
- beambot 5y ago
  It's true, the nordic countries do well on Social Mobility [1] (measure of intergenerational economic mobility). However, I think we can all agree that they're fairly homogenous ethnically & culturally (e.g. as measured by Fearon's measure [2]), and that these factors play a huge role in social mobility in places like the United States. In fact, if you jointly score social mobility & ethnic diversity, the United States looks to come out very close to the top (if not the top). It's probably not a "one size fits all" solution, though social safety nets are obviously a critical part of the equation. [1] https://en.wikipedia.org/wiki/Global_Social_Mobility_Index https://en.wikipedia.org/wiki/Global_Social_Mobility_Index [2] https://en.wikipedia.org/wiki/List_of_countries_ranked_by_ethnic_and_cultural_diversity_level https://en.wikipedia.org/wiki/List_of_countries_ranked_by_et...
- nine_k 5y ago
  I think it's not the tax rate; most despotic regimes grab as much or even more from their subjects. It's the legal framework, the laws being actually enforced (low corruption), and just the culture of the lay people who learned to trust each other after centuries of that. Formally Sweden is a kingdom while Nigeria is a democratic republic, but it does not change much.
- yardstick 5y ago
  If it was only 30-35% to achieve this that would be great. Sweden has a ~55% marginal tax rate for everything over SEK 309,000 (approx 55k USD). 55k USD isn’t much in most US tech companies.
  - kwhitefoot 5y ago
    It's a lot more than the US median salary though (31 kUSD). And 309 kSEK is roughly the arithmetic mean income in Sweden so most people are paying less than that marginal tax rate.
sp332 5y ago
Being able to work to increase your own wealth isn't really controversial. In fact most Americans over-estimate the amount of economic mobility that we have, which is probably what the article is referring to. And rich families tend to have their wealth eroded in just 2-3 generations. https://www.nasdaq.com/articles/generational-wealth%3A-why-do-70-of-families-lose-their-wealth-in-the-2nd-generation-2018-10 https://www.nasdaq.com/articles/generational-wealth%3A-why-d...
- b9a2cab5 5y ago
  > In fact most Americans over-estimate the amount of economic mobility that we have Your link seems to say otherwise. If economic mobility were low then most rich families would not see their wealth meaningfully eroded for generations. This was the case in feudal Europe and many ancient empires like Rome. The fact that most families lose wealth in 3 generations due to mismanagement implies someone else is gaining that lost wealth - ergo economic mobility should be high. Personally I feel the economic mobility afforded by high paying jobs and widespread capital in the US is unmatched. I started making more money than my parents by my junior year in college and genuinely feel like I have a non-zero chance at hitting 25 million USD net worth during my life. I have friends who have gotten millions of dollars in startup funding and have 10+ paid employees. You can't say the same if you live in Europe.
  - sp332 5y ago
    Here's one source for the over-estimation thing https://www.realclearscience.com/journal_club/2015/11/13/americans_overestimate_social_class_mobility_and_the_effect_is_more_pronounced_among_conservatives_109450.html https://www.realclearscience.com/journal_club/2015/11/13/ame...
  - amcoastal 5y ago
    You think the people gaining the wealth that some rich families are losing are people that need high economic mobility and not just other rich people?
    - 5y ago
thjkgfgrrioppo 5y ago
Is money really the issue? In many places, everybody gets a free education, and even university is free. So everybody could simply become a doctor or a lawyer and expect an income above the poverty line - at least if money was the only issue.
- bobthepanda 5y ago
  That would assume the free education people get is equivalent across income levels, which is a hard thing to do in the best of circumstances. Even independent of educational quality, there is a world of difference between a school's ability to teach a well fed, comfortable child and a child whose only meal of the day is the free school lunch. Similarly, a rich child can afford to do unpaid internships on summer break, whereas a poor one may be working minimum wage jobs to generate an income instead. This is before you get into the weeds of things like teachers preferring to be placed into good schools because it makes their jobs easier, that well-connected schools can raise money outside of the public system, etc. People say they want educational equality, but this is almost never at the perceived cost to their own children.
  - thjkgfgrrioppo 5y ago
    In my country the differences beteren universities (and schools) are not very big. It seems very unlikely that more money could buy a significantly better education. Nobody is starving, either.
  - b9a2cab5 5y ago
    The idea that education (in terms of knowledge and skill acquisition) is zero sum is wrong. Educational equality starts with parents giving a shit about their kids' education. Why do you think Asians overachieve on every benchmark we have? Could it possibly be because there are cultural factors that motivate parents to care very strongly about their childrens' education? America spends the most in the world per capita on our schools and has terrible results. It's clear that tossing more money into a black hole won't fix the problem. Anecdotally, in high school I never heard any white/Latino/black friend joke about getting yelled at if they got a B. > unpaid internships You might want to take a look at levels.fyi. Internship salaries are higher than a lot of full time jobs nowadays.
somesortofthing 5y ago
It's obvious but acknowledging it too loudly can be seen as denying people's agency, both in the abstract(It can be interpreted as devaluing the experiences of people who escaped generational poverty) and in particular(A poor person hearing you say it may interpret it as you saying that their efforts to escape poverty are for naught). I don't agree with these interpretations, but there certainly are people that will deploy them, for one reason or another.

jokoon 5y ago

Most people, particularly in the west, believe that merit can be acquired, "just do it", "self made man", free will etc. Liberal economics are surrounded with those kinds of ideals that always explain that the poor deserve their status, that they only have themselves to blame.

throwaway55421 5y ago
The statements are not symmetrical, though. Let's use the less emotionally charged example of the gym rat. An individual who sets out with the goal and drive to become strong can be successful with high probability. But not everyone will do that. Most will give up or just not even bother in the first place.
- jokoon 5y ago
  It improves the probability, but it's not a requirement, and sometimes it doesn't increase the probability at all.
  - throwaway55421 5y ago
    I mean, sure, if we want to abandon the concept of cause and effect entirely because John went to the gym and ... got hit by a bus on the way, oops.

nerdponx 5y ago

Perhaps "little-acknowledged-by-politicians" is more apt.

vaidhy 5y ago
Probably, not just by politicians, but also from everyone who strongly believes is pulling themselves by bootstraps.

Animats 5y ago

Sweden does it. It takes about a 30-35% tax rate.[1] Nigeria is a poor country which still has a high birth rate. Outside of Africa, almost all countries are past that. Even China and India. [1] https://borgenproject.org/poverty-in-sweden/ https://borgenproject.org/poverty-in-sweden/

beambot 5y ago
It's true, the nordic countries do well on Social Mobility [1] (measure of intergenerational economic mobility). However, I think we can all agree that they're fairly homogenous ethnically & culturally (e.g. as measured by Fearon's measure [2]), and that these factors play a huge role in social mobility in places like the United States. In fact, if you jointly score social mobility & ethnic diversity, the United States looks to come out very close to the top (if not the top). It's probably not a "one size fits all" solution, though social safety nets are obviously a critical part of the equation. [1] https://en.wikipedia.org/wiki/Global_Social_Mobility_Index https://en.wikipedia.org/wiki/Global_Social_Mobility_Index [2] https://en.wikipedia.org/wiki/List_of_countries_ranked_by_ethnic_and_cultural_diversity_level https://en.wikipedia.org/wiki/List_of_countries_ranked_by_et...
nine_k 5y ago
I think it's not the tax rate; most despotic regimes grab as much or even more from their subjects. It's the legal framework, the laws being actually enforced (low corruption), and just the culture of the lay people who learned to trust each other after centuries of that. Formally Sweden is a kingdom while Nigeria is a democratic republic, but it does not change much.
yardstick 5y ago
If it was only 30-35% to achieve this that would be great. Sweden has a ~55% marginal tax rate for everything over SEK 309,000 (approx 55k USD). 55k USD isn’t much in most US tech companies.
- kwhitefoot 5y ago
  It's a lot more than the US median salary though (31 kUSD). And 309 kSEK is roughly the arithmetic mean income in Sweden so most people are paying less than that marginal tax rate.

sp332 5y ago

Being able to work to increase your own wealth isn't really controversial. In fact most Americans over-estimate the amount of economic mobility that we have, which is probably what the article is referring to. And rich families tend to have their wealth eroded in just 2-3 generations. https://www.nasdaq.com/articles/generational-wealth%3A-why-do-70-of-families-lose-their-wealth-in-the-2nd-generation-2018-10 https://www.nasdaq.com/articles/generational-wealth%3A-why-d...

b9a2cab5 5y ago
> In fact most Americans over-estimate the amount of economic mobility that we have Your link seems to say otherwise. If economic mobility were low then most rich families would not see their wealth meaningfully eroded for generations. This was the case in feudal Europe and many ancient empires like Rome. The fact that most families lose wealth in 3 generations due to mismanagement implies someone else is gaining that lost wealth - ergo economic mobility should be high. Personally I feel the economic mobility afforded by high paying jobs and widespread capital in the US is unmatched. I started making more money than my parents by my junior year in college and genuinely feel like I have a non-zero chance at hitting 25 million USD net worth during my life. I have friends who have gotten millions of dollars in startup funding and have 10+ paid employees. You can't say the same if you live in Europe.
- sp332 5y ago
  Here's one source for the over-estimation thing https://www.realclearscience.com/journal_club/2015/11/13/americans_overestimate_social_class_mobility_and_the_effect_is_more_pronounced_among_conservatives_109450.html https://www.realclearscience.com/journal_club/2015/11/13/ame...
- amcoastal 5y ago
  You think the people gaining the wealth that some rich families are losing are people that need high economic mobility and not just other rich people?
  - 5y ago

thjkgfgrrioppo 5y ago

Is money really the issue? In many places, everybody gets a free education, and even university is free. So everybody could simply become a doctor or a lawyer and expect an income above the poverty line - at least if money was the only issue.

bobthepanda 5y ago
That would assume the free education people get is equivalent across income levels, which is a hard thing to do in the best of circumstances. Even independent of educational quality, there is a world of difference between a school's ability to teach a well fed, comfortable child and a child whose only meal of the day is the free school lunch. Similarly, a rich child can afford to do unpaid internships on summer break, whereas a poor one may be working minimum wage jobs to generate an income instead. This is before you get into the weeds of things like teachers preferring to be placed into good schools because it makes their jobs easier, that well-connected schools can raise money outside of the public system, etc. People say they want educational equality, but this is almost never at the perceived cost to their own children.
- thjkgfgrrioppo 5y ago
  In my country the differences beteren universities (and schools) are not very big. It seems very unlikely that more money could buy a significantly better education. Nobody is starving, either.
- b9a2cab5 5y ago
  The idea that education (in terms of knowledge and skill acquisition) is zero sum is wrong. Educational equality starts with parents giving a shit about their kids' education. Why do you think Asians overachieve on every benchmark we have? Could it possibly be because there are cultural factors that motivate parents to care very strongly about their childrens' education? America spends the most in the world per capita on our schools and has terrible results. It's clear that tossing more money into a black hole won't fix the problem. Anecdotally, in high school I never heard any white/Latino/black friend joke about getting yelled at if they got a B. > unpaid internships You might want to take a look at levels.fyi. Internship salaries are higher than a lot of full time jobs nowadays.

somesortofthing 5y ago

It's obvious but acknowledging it too loudly can be seen as denying people's agency, both in the abstract(It can be interpreted as devaluing the experiences of people who escaped generational poverty) and in particular(A poor person hearing you say it may interpret it as you saying that their efforts to escape poverty are for naught). I don't agree with these interpretations, but there certainly are people that will deploy them, for one reason or another.