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Forums - General - Wealth Inequality in America

ICStats on 15 January 2014
DJEVOLVE said:

Does this include unearned income, because the stock markets trippled since 2009 so who do you think has money in stocks?

If I had $1 million in savings (not a lot really) and it grew to $3 million in this time then yeah it's going to beat any normal wage increase in that time.

I bet the 1% also lost the most wealth during the recession.



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anonymunchy on 15 January 2014
Mr Puggsly said:
anonymunchy said:


"Not acquring the skills needed to get a decent paying job is a choice."
This is far from the truth. Not everyone is born with the same privileges. No one choses where they are born, who raises them, how they get introduced into the world, who teaches them how to live. Someone who is born into poverty may never even realise they want to get out of it. They are a product of their surroundings, just like you. Your words paint an overly simplistic picture of some very complex issues. It may have been a choice for you, it certainly isn't for everyone. Besides this, there is no guarentee that the skill you acquire is going to lead you to a decent paying job. Job markets change constantly and so do education requirements. To go even further, shouldn't "decent paying" be a requirement for all jobs? Someone needs to do the work, so someone needs to survive on what it pays.

Besides some Scandinavian countries I've never heard of a government actually given money to people to go to college. The idea of getting into debt with the government without job security doesn't sound very appealing to me neither.

Not sure whether or not my point will come across, but it's the best I can do right now.

You're making excuses for the people that choose not work towards something better than they're born into. You're basically saying people are ignorant to a better life than poverty, but I feel many are simply content with their situation. A poor American lives a better life than most people in the world.

Many people don't even make the effort to finish High School and that's free. That's a great example of how unmotivated a large number of people are in this country.

Are you aware the US gives money to people so they can go to college? I'm not talking about loans, its free money for people that don't have much money. Many people don't even bother to take advantage of it because they're too damn lazy.


I wasn't aware the US did that no, but why jump to the conclusion they are lazy.

The articles linked here look interesting and I'll definitely give them a read.



Kynes on 15 January 2014
Pristine20 said:
sc94597 said:
Pristine20 said:


What you have done is commendable no doubt but the vast majority are going to be stuck in whatever bracket their parents are in. 

This is incorrect. 

http://www.treasury.gov/resource-center/tax-policy/Documents/incomemobilitystudy03-08revise.pdf

http://www.frbsf.org/economic-research/publications/economic-letter/2013/march/us-economic-mobility-dream-data/

58% of households in the lowest quintile in 1996 were in a higher quintile in 2005. 

57% of households in the top 1% in 1996 were no longer in the top 1% in 2005. 

One problem with popular portrayals of the income gap is that they show income distribution at a single point in time. But for many households, income changes over time. The low-paying jobs from high school days usually give way to better-paying jobs later in life. Figure 1A shows the percentage of households that moved to a higher income quintile from 1996 to 2005. For example, nearly 58 percent of the households in the lowest income quintile in 1996 moved to a higher category by 2005. The reverse also happens, as shown in Figure 1B. Of those households that were in the top 1 percent in income in 1996, for example, more than 57 percent dropped to a lower income group by 2005.

Granted it was 1996 - 2005, but the "Great Recession" hasn't changed things much, based on recent studies (I chose this one, despite its age, because the source for the data is the U.S Treasury.) 

For other studies: 

http://www.businessinsider.com/inequality-and-mobility-in-the-united-states-2013-7

 

 

 

Only 22%-25% stay in the same bracket as his father whether his father was in the top 10% or the bottom 10%. Oddly enough, around 7% go from the bottom to the top. So for every 100 men born in the bottom 10% of fathers, there are seven who went to the top, 2 who went to the 90 percentile, 5 who went to the 80 percentile and 5 who went to the 70th percentile, 11 who went to the 60th percentile and 11 who went to the 50th percentile, 10 who went to the 40th percentile and 10 who went to the 30th percentile, and 17 who went to the 20th percentile. About 51% of men who were born at the bottom moved to the upper 50% of the population. 


Could've sworn I read a forbes article that made the point I posted but I can't find it now. Your article seems solid. I certainly didn't see that one coming. Interestingly though, as some move up, others move down. I guess some people just have to be poor  for others to be rich both literarily and figuratively i.e if everyone had 1 mil in the bank, 1 mil wont be considered rich anymore. There are limited resources so there will always be unequal distribution.

Equality is only truly achieved in death as per the great quote in my sig.

Talking about deciles of population, it's clear that you can't have more than a 10% of all the population on the same decile, so it's statistically true that as some move some brackets up, some move down. Another different thing is the median wealth of each decile.



Pemalite on 15 January 2014
Mr Puggsly said:
Jay520 said:
Why do you think the poor choose not to escape poverty? Lack of education? Low cognitive capacity? What do you think? I am interested.


I presume the biggest issue is lack of motivation. Perhaps many poor people are content with the little money they make or their government handouts. The fact is even poor people in America live pretty well compared to most people in the world.

I'm not sure what the solution is, but I'm certain most people living in poverty can pull themselves out.

It's not as simple as that.
I have seen people here with excellent skills and qualifications, have a couple of jobs and are still poor, why? Because the amount of high paying jobs is at a relative low, those qualifications do squat if you can't get a job in a particular field. (Something that is occuring more and more across the planet.)

Personally, I would have been classed as poor a few years ago earning only 30k a year, but even with such an income I was still far better off than some of my peers who were bogged down with debt despite earning twice as much.

Years ago, I could jump from job to job whilst studying and not think twice about it, these days it's tough to find a decent paying job, hence why I'm staying where I am. :P

So no, not everyone can pull themselves out of poverty, some can, but they are a relative minority... It doesn't help that the USA's minimum wage is pathetically low compared to my own country Australia, $17 vs $7 is a pretty big bloody difference and you get health care on top of it.




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Rab on 15 January 2014
DJEVOLVE said:


Great quote from the Video

"If Americans want to live the American Dream they should go to Denmark" lol



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DJEVOLVE on 15 January 2014
sales2099 said:
Personally, it comes down to the population exceeding the ability to create jobs to keep up.

We should have a population control plan in place.....but then the riots will happen for restricting free rights.


No it is the fact that you can't compete with slave labor unless you have it your self. Competing with China is rough if you don't put tariffs on them.  Any market that treats their workforce like slaves shoudn't be allowed to enter markets with a good labor laws. until they clean up their act or they have to pay very high tariffs to do so. Only way compete with someone who has slaves, is to have slaves.



MoHasanie on 15 January 2014

The video was interesting but most people already know this. I find it annoying that the narrator keeps mentioning how the graphs and charts look like for the situation where thee 5000 people said they thought how the wealth was distributed. It should have been simple and compared the ideal situation to the current one.



    

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sc94597 on 15 January 2014
Pemalite said:

So no, not everyone can pull themselves out of poverty, some can, but they are a relative minority... It doesn't help that the USA's minimum wage is pathetically low compared to my own country Australia, $17 vs $7 is a pretty big bloody difference and you get health care on top of it.

Again, this is not true. 56% of Men born in the lowest decile (in the United States) change deciles. Even more women do this. Source: U.S Treasury.

Also, the cost of living in Australia is higher than in the U.S, with the USD having higher local purchasing power. Seeing as the federal minimum wage must consider the lowest cost of standards of living (in a very diverse economic landscape), it makes sense that the minimum wage is where it is at. Some states have higher minimum wages. The highest being $9.19 (by statual law.) We know that minimum wage laws can lead to more inflation and unemployment when poorly implemented. As for health-care, half of Americans are covered by their jobs, 16% are on Medicaid (the ones with minimum wage jobs or no wage that we're referring to), 14% are on Medicare. Only 5% of Americans pay for their own insurance, and 15% are uninsured. Plus the health-care you speak of is paid for by somebody. There is no free lunch. 

http://www.numbeo.com/cost-of-living/compare_countries_result.jsp?country1=Australia&country2=United+States

http://www.numbeo.com/cost-of-living/rankings_by_country.jsp

Consumer Prices in United States are 29.39% lower than in Australia

 Consumer Prices Including Rent in United States are 31.98% lower than in Australia

Rent Prices in United States are 37.15% lower than in Australia

Restaurant Prices in United States are 30.83% lower than in Australia

Groceries Prices in United States are 22.03% lower than in Australia

Local Purchasing Power in United States is 27.32% higher than in Australia



Pemalite on 15 January 2014
sc94597 said:

Again, this is not true. 56% of Men born in the lowest decile (in the United States) change deciles. Even more women do this. Source: U.S Treasury.

Also, the cost of living in Australia is higher than in the U.S, with the USD having higher local purchasing power. Seeing as the federal minimum wage must consider the lowest cost of standards of living (in a very diverse economic landscape), it makes sense that the minimum wage is where it is at. Some states have higher minimum wages. The highest being $9.19 (by statual law.) We know that minimum wage laws can lead to more inflation and unemployment when poorly implemented. As for health-care, half of Americans are covered by their jobs, 16% are on Medicaid (the ones with minimum wage jobs or no wage that we're referring to), 14% are on Medicare. Only 5% of Americans pay for their own insurance, and 15% are uninsured. Plus the health-care you speak of is paid for by somebody. There is no free lunch.


Probably true.

As for cost of living, that's most certainly true, but you also get more benefits.
For instance, you get universal health care which obviously has done more good than harm, life expectancy in Australia is one of the highest in the world, the wealthy pay a 1.5% levy to fund it, for me that's about $1,000 a year, others it is less than half that.
You also have the option of private insurance if you wan't.

The IHDI/HDI or inequality-adjusted human development index easily eclipses that of the US, it's a good indicator of standard/quality of living.
You also get more Sick leave, Paid Holidays and Paid Annual Leave.
The way I look at it, Americans live to work while Australians work to live.

Plus... Because the minimum wage is higher, people spend more, when our dollar was higher than the USD, I was spending hundreds every week importing stuff and because the minimum wage is higher for workers at places like resturants, people don't leave "tips" which is something expected in the USA, those are things that are usually not accounted for in most cost of living reports.

All in all, those who are on the minimum wage can live comfortable and happy lives in Australia, even if you have children, the same thing can't be said about the US for allot of families on the minimum wage working a single job.
Besides, on average the cost of living is roughly only 30%-50% more, but workers get paid almost 100% more and has kept in line with inflation which didn't really happen in the US, it's been at the same rate for how many years?




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sc94597 on 15 January 2014
Pemalite said:

All in all, those who are on the minimum wage can live comfortable and happy lives in Australia, even if you have children, the same thing can't be said about the US for allot of families on the minimum wage working a single job.

For now I won't address the rest of the post (if I ever do.) But I would like to say that minimum wage jobs also tend to be part-time jobs. I can't think of a full-time career/job that pays a minimum wage. That is the main reason why one can't survive on a minimum wage job. 7.25/hr for only 20 hours/week is not livable, unless one makes big sacrifices (although I'm sure it is possible when combined with food stamps and subsidized housing, or even without those.) 7.25/hr with full-time benefits for 40 hours a week would see much more bearable for somebody on their own. That is about the stipdend of a graduate student.  

As for the Human Development Index, Australia isn't very far ahead when one doesn't consider "economic inequality" (IHDI.) The overwhelming majority of U.S states surpass Australia's states (and Australia's average.) Because there is so much variation; however, we see a slight difference. 

http://en.wikipedia.org/wiki/Human_Development_Index

2.  Australia 0.938 ()

3. United States 0.937 ( 1)