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The factor in this: When you ask people how they are skillwise or knowledgewise, or how they stand in quality, most people will rate themselves above average:
http://en.wikipedia.org/wiki/Illusory_superiority

Add that factor, with a belief in fairness, or meritocracy, and that people should get what they deserve, and factor in the other things discussed here, and you run into a situation of disconent in a society.

This goes even for looks:
http://www.msnbc.msn.com/id/39044399/ns/health-skin_and_beauty/t/most-us-think-were-hotter-average-survey-says/