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I have yet to see a solid discussion of wealth inequality that removes the outliers. Given that 85 people have half the worlds wealth, it would appear to me tha

I have yet to see a solid discussion of wealth inequality that removes the outliers. Given that 85 people have half the worlds wealth, it would appear to me that a study which looks at the numbers without those people would be more interesting in helping us understand how our systems and markets are moving wealth for 99.999% of us. Even still, the goal should not be balanced wealth but continual upward mobility for all people - or more aptly distance from poverty. There will always be rich and poor but the standard of living and equity of opportunity for the poor is what we should focus on. It is more important that a poor kid have good education, healthcare and living standards than it is to rebuke the rich guy for having a yacht. It seems we are in this stage where we recognize something isn't right but we are immaturely blaming the rich guy and saying he should give his money to the poor kid rather than finding real solutions to the plight of the poor kid.

HarryHirsch 13y ago
Why would you remove the outliers? There is information in the sample distribution, and if you are removing everything outside 3sigma (or even 6sigma) you are squashing the data. A high level of wealth comes with disproportionate political power. One shouldn't disregard this aspect and confine the discussion to most people having a fairly comfortable life.
abduhl 13y ago
The problem is that poverty is continually redefined as standard of living and opportunities increase. Poverty used to be living in a shanty town during the dust bowl where you could possibly die of dehydration any day. Poverty now is living in a house where you only get basic cable and don't have the money to buy a nice steak dinner.
- ctdonath 13y ago
  Some 87% of world population lives below the "poverty line" as defined in the USA. Without everyone sharing a sensible consistent definition of the word, the discussion will come to nothing but blows.
  - digikata 13y ago
    Different places in the world should have different poverty lines related to the purchasing power needed to acquire at least the basic living needs: food, shelter, and clothing. (and healthcare) Comparing the numerical figure of the poverty line around to world is nonsensical.
    - bd_at_rivenhill 13y ago
      Absolutely agree, having a single worldwide standard would put ALL US residents in the 'wealthy' category when compared to places like Haiti.
      - ctdonath 13y ago
        I'll agree there. Haitians, on the whole, are indeed objectively poor: given the limited land to work with, the large & growing population, and the high cost of import/export infrastructure, there just isn't enough resources to support residents. This vs the USA, where there is enough resources, and the best answer to poverty in most cases is MOVE to where there are sufficient opportunity & resources (like the Dakotas, where even mundane jobs pay very well because they can't get enough people to do the work needed to facilitate extracting wealth from natural resources).
    - ctdonath 13y ago
      The "87%" is PPP corrected. You make my point: it is nonsensical to argue about "poor" when wildly contradictory definitions are being used. A great many legally "poor" in the USA have homes, cars, running hot/cold clean water, HVAC, cable TV, smartphones, etc. and a livable income plus generous free food. For other areas, having a little more than an objectively minimal nutritional intake, survivable shelter, adequate clothing, and mundane healthcare counts one as "not poor" despite still being well below the official US standard. We need an objective definition of "poor" better than "can't get by on $X in the world's most expensive cities".
Guvante 13y ago
Wealth inequality is actually not all that interesting, income inequality is all that really matters. Most of the US doesn't save a significant percentage of their income. And while that may prove a problem when they go to retire, it doesn't mean they aren't receiving their fair share.
anigbrowl 13y ago
85 people have half the worlds wealth I carelessly posted a story with a headline like this a week or two ago, but a more accurate statement would be that 85 people have as much wealth as the poorest half of the world's population. that's still a pretty startling concept though - that you could make half the people in the world twice as well off as they are now by disenfranchising a mere 85 individuals, or that each of those on average holds as much wealth as 41 million very poor people. Of course there would be a knock-on effect that would hurt all the people who work for or do business with those 85. And as a statistic I'm not sure how valuable it is; even my averaging comment is misleading because the distribution of wealth within those 85 individuals likely has a rough Pareto distribution. Like the author I'm not entirely convinced that this is bad, for the same reason that I don't consider elephants and whales to be in opposition to ants or plankton; Pareto distributions seem to be a fact of the natural world and so we shouldn't be too surprised to see them appear in distributions of wealth. Of course there are lots of natural things that are widely considered undesirable, so I anticipate increasing political pressure to alter such imbalances.
- SigmundA 13y ago
  Most of the issue seems to comes down to "fairness". The natural world is not fair, but it is a working system. A elephant does not work harder than a an ant to survive, in fact you might say the opposite is true. The elephant won the ovarian lottery, this is not fair to the ant, but the system works. I think it would be ridiculous to suggest that those 85 people worked 41 million times harder to get where they are compared to the other 3.5 billion, that's simply impossible. The successful seem to have a hard time grasping or accepting the amount of opportunity (luck) involved in their success. I personally think its better to look at the economy as a game and the game must have arbitrary rules defined to "level the playing field". These rules must followed and enforced to maximize the enjoyment of the games participants. After all thats what a modern economy does, improve quality of life, not just survival. The rules will need to be modified and tuned over time to find the sweet spot. As with all games there will be super-stars and weak players that get compensated differently, however the ruleset will limit inequality to something "fair" and "enjoyable" to all participants. One quote that always comes to mind: "The free market should be a prize fight not a barroom brawl".

HarryHirsch 13y ago

Why would you remove the outliers? There is information in the sample distribution, and if you are removing everything outside 3sigma (or even 6sigma) you are squashing the data. A high level of wealth comes with disproportionate political power. One shouldn't disregard this aspect and confine the discussion to most people having a fairly comfortable life.

abduhl 13y ago

The problem is that poverty is continually redefined as standard of living and opportunities increase. Poverty used to be living in a shanty town during the dust bowl where you could possibly die of dehydration any day. Poverty now is living in a house where you only get basic cable and don't have the money to buy a nice steak dinner.

ctdonath 13y ago
Some 87% of world population lives below the "poverty line" as defined in the USA. Without everyone sharing a sensible consistent definition of the word, the discussion will come to nothing but blows.
- digikata 13y ago
  Different places in the world should have different poverty lines related to the purchasing power needed to acquire at least the basic living needs: food, shelter, and clothing. (and healthcare) Comparing the numerical figure of the poverty line around to world is nonsensical.
  - bd_at_rivenhill 13y ago
    Absolutely agree, having a single worldwide standard would put ALL US residents in the 'wealthy' category when compared to places like Haiti.
    - ctdonath 13y ago
      I'll agree there. Haitians, on the whole, are indeed objectively poor: given the limited land to work with, the large & growing population, and the high cost of import/export infrastructure, there just isn't enough resources to support residents. This vs the USA, where there is enough resources, and the best answer to poverty in most cases is MOVE to where there are sufficient opportunity & resources (like the Dakotas, where even mundane jobs pay very well because they can't get enough people to do the work needed to facilitate extracting wealth from natural resources).
  - ctdonath 13y ago
    The "87%" is PPP corrected. You make my point: it is nonsensical to argue about "poor" when wildly contradictory definitions are being used. A great many legally "poor" in the USA have homes, cars, running hot/cold clean water, HVAC, cable TV, smartphones, etc. and a livable income plus generous free food. For other areas, having a little more than an objectively minimal nutritional intake, survivable shelter, adequate clothing, and mundane healthcare counts one as "not poor" despite still being well below the official US standard. We need an objective definition of "poor" better than "can't get by on $X in the world's most expensive cities".

Guvante 13y ago

Wealth inequality is actually not all that interesting, income inequality is all that really matters. Most of the US doesn't save a significant percentage of their income. And while that may prove a problem when they go to retire, it doesn't mean they aren't receiving their fair share.

anigbrowl 13y ago

85 people have half the worlds wealth I carelessly posted a story with a headline like this a week or two ago, but a more accurate statement would be that 85 people have as much wealth as the poorest half of the world's population. that's still a pretty startling concept though - that you could make half the people in the world twice as well off as they are now by disenfranchising a mere 85 individuals, or that each of those on average holds as much wealth as 41 million very poor people. Of course there would be a knock-on effect that would hurt all the people who work for or do business with those 85. And as a statistic I'm not sure how valuable it is; even my averaging comment is misleading because the distribution of wealth within those 85 individuals likely has a rough Pareto distribution. Like the author I'm not entirely convinced that this is bad, for the same reason that I don't consider elephants and whales to be in opposition to ants or plankton; Pareto distributions seem to be a fact of the natural world and so we shouldn't be too surprised to see them appear in distributions of wealth. Of course there are lots of natural things that are widely considered undesirable, so I anticipate increasing political pressure to alter such imbalances.

SigmundA 13y ago
Most of the issue seems to comes down to "fairness". The natural world is not fair, but it is a working system. A elephant does not work harder than a an ant to survive, in fact you might say the opposite is true. The elephant won the ovarian lottery, this is not fair to the ant, but the system works. I think it would be ridiculous to suggest that those 85 people worked 41 million times harder to get where they are compared to the other 3.5 billion, that's simply impossible. The successful seem to have a hard time grasping or accepting the amount of opportunity (luck) involved in their success. I personally think its better to look at the economy as a game and the game must have arbitrary rules defined to "level the playing field". These rules must followed and enforced to maximize the enjoyment of the games participants. After all thats what a modern economy does, improve quality of life, not just survival. The rules will need to be modified and tuned over time to find the sweet spot. As with all games there will be super-stars and weak players that get compensated differently, however the ruleset will limit inequality to something "fair" and "enjoyable" to all participants. One quote that always comes to mind: "The free market should be a prize fight not a barroom brawl".