Are you the 9.9%?

[samclem]

If you were born in North America, Europe or another developed country, you are privileged. Per the Global Rich List, at an annual income of $13,750, globally you are in the "privileged" 9.9%. That would include most of the US poor referenced in the article.

Maybe the article could have taken a different angle. We are indeed fortunate.

Yep, and that's just those alive today, disregarding the grinding poverty and suffering that mankind has experienced for millennia.

Gratitude, being grateful for what you have and what you have received, is increasingly recognized as an important facet of happiness. People who are grateful and who express this gratitude toward those who have helped them, and who practice doing this consciously, improve their happiness. It is easy to be miserable, regardless of what you have, if you feel that "society" owes you more, more, more.



If the author of this article wanted to help avoid putting people on the defensive, it would have been best to avoid the personal vignettes (which, IMO, helped make the piece much too long for the ideas conveyed. Maybe The Atlantic pays by the word).

 

[Chuckanut]

I would hugely disagree with the 4th one. I don't see how that leads to economic success. Staying single can just as much lead to economic success, too.

One certainly does not have to be married to do well economically, but, IIRC, most statistics show that single people make up a disproportionate share of those who fall below the poverty line. Why? Which is cause and which is effect? I don't know.

 

[Lsbcal]

One of the hazards of life in the 9.9 percent is that our necks get stuck in the upward position. We gaze upon the 0.1 percent with a mixture of awe, envy, and eagerness to obey. As a consequence, we are missing the other big story of our time. We have left the 90 percent in the dust—and we’ve been quietly tossing down roadblocks behind us to make sure that they never catch up.

A very ugly view of people. I think the author is guilty of extremes of generalization. Certainly does not describe us or people I know.

 

[athena53]

I'm thinking of looking at this from the other end:

By virtue of their sheer volume, the 90% sort of set pricing for almost everything.

Food, cars, dining, clothes, (average) homes, utilities, energy and so on.

Not talking about the truly poor but the average non-10%-er.

So, if the average income for the 90% is let's say $50K, how many of us here would be able to RE without that 'price control'? Could we retire if a night out at Applebees cost $300 and a pair of slacks cost $400?

What's happened, though, is that the top half of the 90% are exploiting the bottom half of the 90%. As the 90% have made clear by their purchasing patterns, price is almost everything. That has resulted in squeezing every bit of service out of the product, offshoring to countries with lower wages and less-rigorous workplace and pollution standards, and emphasizing "cheap" over high-quality. It's led to the loss of jobs and resulted in more jobs that are PT and/or don't include any benefits.

Remember when there was a guy (usually a guy) at the shoe store who would measure your foot and bring out shoes from the stockroom in the back so you could try them on? They supported families on those jobs. If you didn't have a lot of money you owned only one or two pair of shoes and might wear hand-me-downs from a sibling (because shoes lasted that long). Now anyone can buy tons of plastic shoes at PayLess or Wal-Mart. Same with clothing. The top half of the 90% could probably afford to choose quality over quantity but they don't. They eat at McDonald's because it's fast and cheap. They're buying $45 knock-offs of Meghan Markle's wedding dress (yes, according to one headline, they are).

I don't have an answer. I can't dictate values to other people. It just saddens me to see people with carts full of cheap crap made in China when some (not all, I know) could do better.

BTW, I own slacks that cost over $400/pair- several of them. Ordered through a local tailor and made in workshops in the US. They're part of the wardrobe I accumulated for business and I still wear pieces when I have to dress up and look respectable. It's also motivation not to gain weight! I still ER'd because the rest of my lifestyle was not on that scale and I made only one trip per year to that tailor.

 

[Amethyst]

OT, I know...it just strikes me as counterintuitive, that someone who excels at Scrabble would do poorly on a test measuring knowledge of words. OK, back to topic.

It was that test which told me I'd have no problem with the Math, and no hope with the verbal.

 

[kcowan]

it doesn’t matter how much you make. what matters is how much you managed to hang onto.

Amen bro! LBYM no matter where the money comes from.

 

[REWahoo]

OT, I know...it just strikes me as counterintuitive, that someone who excels at Scrabble would do poorly on a test measuring knowledge of words.

I understand that can happen if someone has a diet insufficient in chlorophyll.

 

[scrabbler1]

One certainly does not have to be married to do well economically, but, IIRC, most statistics show that single people make up a disproportionate share of those who fall below the poverty line. Why? Which is cause and which is effect? I don't know.

I don't think being single leads to falling below the poverty line. I think falling below the poverty line leads to being single. Just like doing other stupid things such as being in trouble with the law, doing drugs, drinking too much, having kids out of wedlock, and so forth, lead to being single.

But if you don't do those bad things and then end up being single (by choice, or due to things which aren't self-destructive), that doesn't hurt your chances at falling below the poverty line.

 

[scrabbler1]

OT, I know...it just strikes me as counterintuitive, that someone who excels at Scrabble would do poorly on a test measuring knowledge of words. OK, back to topic.

I took those tests when I was 17. It took me a while, but I figured out words years later. And in Scrabble, you don't have to know what the words mean, only that they are acceptable in Scrabble play.

 

[Huston55]

A very ugly view of people. I think the author is guilty of extremes of generalization. Certainly does not describe us or people I know.

I have to say I’m glad this article was posted (thanks OP), and I’ve enjoyed the discussion thusfar. I quoted ‘Lsbcal’ because, after reading the article more than once, then using the magic of Google to fact check some of the author’s assertions (and conclusions), “extremes of generalization” pretty much captures my reaction.

I’m like most here @ E-R.org...I LOVE the graphs. The first two (Figs 1 & 2) actually summarize his whole thesis (other than the ‘guilt of privilege ‘ part). But, checking under the hood just a bit, one could/would reach a very different conclusion.

First, as has already been posted, the “9.9%” actually lose net worth proportion in the graph he uses, despite his assertion to the contrary.

Second, the Gini Coeffecient graph (Fig 2) he uses is suspiciously focused on a small portion of the global Gini Coefficient (like looking through a knothole in a fence); a favorite trick of those casting about for data to support their already reached conclusions. If you read a bit about the Gini Coefficient, it seems pretty clear that: (1) On almost any scale (world or OECD), the US is not an extremely inequitable country, (2) there are several factors [mysteriously omitted by the author] that cause & help explain upticks in current US income & wealth inequality (baby boom, women entering the workforce, aging population, immigration), & (3) the Gini Coefficient wiki page itself states that US income mobility is improving.

“When men and women are considered together, the Gini coefficient-based Shorrocks index trends imply long-term income inequality has been substantially reduced among all workers, in recent decades for the United States.”

In fairness, other scholars reach different conclusions. But, I’m sure you see the data cherry picking going on here. For more info (to reach your own conclusions), here’s the link.

https://en.m.wikipedia.org/wiki/Gini_coefficient

 

[athena53]

I don't think being single leads to falling below the poverty line. I think falling below the poverty line leads to being single. Just like doing other stupid things such as being in trouble with the law, doing drugs, drinking too much, having kids out of wedlock, and so forth, lead to being single.

But if you don't do those bad things and then end up being single (by choice, or due to things which aren't self-destructive), that doesn't hurt your chances at falling below the poverty line.

I agree- in my case, divorcing my first husband SIGNIFICANTLY improved my economic status. I had a good job bought a smaller house, and didn't have to prop him up anymore. He would have dragged us all down.

 

[Texas Proud]

I walked to school so my parents were freed of any Saturday responsibility.

I recall back then learning that for the purpose of National Merit competition, they doubled the verbal score before adding it to the math score, giving the verbal score double weight. This annoyed me because my math score was so high and the verbal score was so low.

Mine also.... if it was the other way I was in easily as I had just missed it by 10 pts IIRC...


Also, low is a relative term... I still scored in the high 80s percentile...

 

[Mdlerth]

Beware of geeks bearing grifts

As far as 'having won the lottery' by simply being born to the right parents/hemisphere, I have often mentioned on this forum of many of my rich-and-famous-family-name schoolmates who are now broke, dead or wishing they were. As jollystomper pointed out, it's what you do with what you got that makes the difference.

There are plenty of non-monetary inequalities in the world, and most of them are of far more consequence in our lives than the financial ones.

I submit that it's obvious why folks only write pieces about economic disparities.

If an article like this one would go on to decry unequal distributions of intellect, health, good looks, athletic ability, musical talent, etc., then I'll know it's not just a prelude to a money grab. Don't hold your breath waiting for it, though.

 

[Amethyst]

Unfair tallness:

https://www.theatlantic.com/business/archive/2015/05/the-financial-perks-of-being-tall/393518/

Unfair good looks:

https://www.smithsonianmag.com/science-nature/how-much-is-being-attractive-worth-80414787/

Unfair nice families:

https://stream.org/academic-study-having-a-loving-family-unfair/

And of course, there's the ultimate solution to "unfair advantage," proposed many years ago by Kurt Vonnegut:

"
THE YEAR WAS 2081, and everybody was finally equal. They weren't only equal before God and the law. They were equal every which way. Nobody was smarter than anybody else. Nobody was better looking than anybody else. Nobody was stronger or quicker than anybody else. All this equality was due to the 211th, 212th, and 213 th Amendments to the Constitution, and to the unceasing vigilance of agents of the United States Handicapper General. "

https://archive.org/stream/HarrisonBergeron/Harrison%20Bergeron_djvu.txt

There are plenty of non-monetary inequalities in the world, and most of them are of far more consequence in our lives than the financial ones.

I submit that it's obvious why folks only write pieces about economic disparities.

If an article like this one would go on to decry unequal distributions of intellect, health, good looks, athletic ability, musical talent, etc., then I'll know it's not just a prelude to a money grab. Don't hold your breath waiting for it, though.

 

[LOL!]

A very ugly view of people. I think the author is guilty of extremes of generalization. Certainly does not describe us or people I know.

Of course it is extreme. If an author wants to get paid, create buzz, and go on the talk-show circuit, they have to do this. Their editors and publishers will help them out.

If this article was anything less, it would probably have not created a discussion here. OTOH, if it was anything more, then this thread would have been shut down a long time ago.

So kudos to the author for getting people to talk.

 

[brett]

I do not only see the rising edu costs as an issue. When I was in university I was able to get great union pay summer jobs with lots of overtime that covered my living expenses and my tuition. Plus an easily obtained, but significantly lower paid part time retail job during semesters. These jobs no not seem to be there any more in the same quantity.

When I started my career I was fortunate to get and heed the advice of my boss. He was extremely successful in his job and his private financial life.

People around me were making pot fulls of money and spending it as fast. Cars, suits, girl friends, divorces.

His advice was two fold. It is not what you make, but what you keep. And, as we considered buying a home his advice was buy a smaller home in a very good area. Following this advice has paid huge dividends for us over the past 35 years. Not to mention some hard work and opportunity recognition.

 

[Mdlerth]

Redistribute everything all the time

Unfair tallness:

https://www.theatlantic.com/business/archive/2015/05/the-financial-perks-of-being-tall/393518/

Unfair good looks:

https://www.smithsonianmag.com/science-nature/how-much-is-being-attractive-worth-80414787/

Unfair nice families:

https://stream.org/academic-study-having-a-loving-family-unfair/

And of course, there's the ultimate solution to "unfair advantage," proposed many years ago by Kurt Vonnegut:

"
THE YEAR WAS 2081, and everybody was finally equal. They weren't only equal before God and the law. They were equal every which way. Nobody was smarter than anybody else. Nobody was better looking than anybody else. Nobody was stronger or quicker than anybody else. All this equality was due to the 211th, 212th, and 213 th Amendments to the Constitution, and to the unceasing vigilance of agents of the United States Handicapper General. "

https://archive.org/stream/HarrisonBergeron/Harrison Bergeron_djvu.txt

And their proposed solution is:

It seems obvious that parents should love their children, and that a loving family is something for which we should all strive. I’m not so naive as to suppose that this is always the case, but it should certainly be the goal of our society. Unfortunately, there are those who don’t feel that way. Recently, a piece in ABC Australia posed the question, “Is having a loving family an unfair advantage?” Seriously.
The piece sets out their basic argument: ”The power of the family to tilt equality hasn’t gone unnoticed, and academics and public commentators have been blowing the whistle for some time. Now, philosophers Adam Swift and Harry Brighouse have felt compelled to conduct a cool reassessment.”
So, what is the premise of this study by Swift and Brighouse? Buckle your seatbelts, because it’s a little crazy. “One way philosophers might think about solving the social justice problem,” they explain, “would be by simply abolishing the family. If the family is this source of unfairness in society then it looks plausible to think that if we abolished the family there would be a more level playing field.”

IOW, the sociological equivalent of The Money Grab.

 

[GravitySucks]

With around half of all marriages (USA) ending in divorce, I surely wouldn't want to risk half my portfolio (and with it, my early retirement) on a marriage ending in divorce; or depend on an iron-clad pre-nup to keep it. Even alimony payments would wreck my budget, what a waste of money going to someone you want out of your life!

Then there are those like me who without DW would probably be dead or imprisoned before 30.
Picking a partner well saved me all types of self imposed foolishness.

 

[athena53]

IHis advice was two fold. It is not what you make, but what you keep. And, as we considered buying a home his advice was buy a smaller home in a very good area.

Since I seem to be lingering on the sad tale of my Ex today, I'll tell a story that illustrates this perfectly. When we divorced, we each got $100K from the sale of the house. He'd actually gotten 60% of the equity because the down payment had come from an inheritance, but after his debts were paid from his share, we had similar amounts.

I put mine down on a smaller house in the same HCOL area (commutable to NYC, well-regarded school system) and took on a $250K mortgage. I sold it 6 years later at a $200K profit. Yeah, the market bit was partly luck, I'll admit that.

My Ex, who had been raised in a wealthy family with solid financial values, never found a job which fit his exalted perception of his skillset and just stayed in the cheap motel where he was living until the money was gone a few years later. He lived off various social programs after that and died in 2010.

You also mentioned the cost of an education in your post- I suspect that the "good union jobs" you could get over the summers when you were in school are gone now. Most studies also show that the cost of a college education has risen far faster over the past 30-40 years than wages, so getting out debt-free is a lot more of a challenge than it used to be.

One hope is the growth of Co-Op programs- Dad was in an early one in Engineering at the University of Cincinnati. You went to school the entire first year but then alternated quarters between your co-op job and school. The co-op job was typically with the same employer your whole academic career. The university would actually receive feedback and monitor your progress. Responsibilities increased every time you returned for another work quarter. Back then it paid well enough that you could fund your education with the work income if you were frugal (and especially if your co-op job enabled you to live with your parents). Most of the Engineers I graduated with accepted a permanent offer with the co-op employer. Even if they didn't, they were highly marketable given their work experience.

So- it's one route for people who want to minimize student debt. It got our family onto the "college track".

 

[Lsbcal]

Unfair tallness:

https://www.theatlantic.com/business/archive/2015/05/the-financial-perks-of-being-tall/393518/

Unfair good looks:

https://www.smithsonianmag.com/science-nature/how-much-is-being-attractive-worth-80414787/

Unfair nice families:

https://stream.org/academic-study-having-a-loving-family-unfair/

And of course, there's the ultimate solution to "unfair advantage," proposed many years ago by Kurt Vonnegut:
...https://archive.org/stream/HarrisonBergeron/Harrison Bergeron_djvu.txt

All this unfairness, it's just not fair.

 

[CardsFan]

One hope is the growth of Co-Op programs- Dad was in an early one in Engineering at the University of Cincinnati. You went to school the entire first year but then alternated quarters between your co-op job and school. The co-op job was typically with the same employer your whole academic career. The university would actually receive feedback and monitor your progress. Responsibilities increased every time you returned for another work quarter. Back then it paid well enough that you could fund your education with the work income if you were frugal (and especially if your co-op job enabled you to live with your parents). Most of the Engineers I graduated with accepted a permanent offer with the co-op employer. Even if they didn't, they were highly marketable given their work experience.

So- it's one route for people who want to minimize student debt. It got our family onto the "college track".

As the product of an Engineering Co-op program (Northeastern '78) I have long touted the benefits, and never understood why more schools (particularly those with technical programs) have not taken this approach. It was the only way I could afford a quality education without having any student debt.

I wonder sometimes if the problem is the competition offers "free money" with no work to be done. Just your promise to pay it back. Sometime. In the future. Maybe.

 

[mrWinter]

If it's at all possible to keep this thread from going off the rails, I'd like to suggest that we pull back a little from the straw man arguments here like Amethyst and Mdlrth are putting forth (you guys aren't jerks, we're just getting a little far afield here IMO). The Atlantic article is not proposing any 1984 style solutions, nor does it anywhere argue that a loving family is an unfair advantage that should be corrected somehow, let's not bring in other articles that may be saying that.

To clarify what the article is criticizing and in answer to what some others have asked about what the Atlantic article proposes as solutions (for those who didn't get through the admittedly long read), I think the majority of it boils down to ending tax breaks of various kinds that go far disproportionately to the wealthy. Things that sounds good on paper but end up being welfare for the rich. For example, tax breaks on employer-sponsored health plans, home mortgage interest deductions, lower tax rates on capital gains, 529 savings, etc. These are all breaks that in theory every citizen can benefit from, but in reality only the wealthy are able to make use of. And because all these benefits are based on percentages, the more money you have that falls into these categories the more you benefit. On the surface sounds fair (because anyone could take advantage of them), and incentivizing the right behavior, but in reality ends up only helping exactly the people who don't need help.

A similar argument has been made in the past against Bernie Sander's proposal for free college for everyone. Sounds great, fair, and equalizing, but in reality, since college admissions are already tilted heavily toward wealthy students, it would only go further to take more money from the pot and give it to the wealthier section of Americans, most of whom were going to go to college anyway.

Just like home-mortgage interest deductions may have sounded like a great idea, but many didn't consider that many people can't save enough for a down payment to ever buy a home in the first place, and they are likely the ones who need the greater breaks and/or incentives to get into home ownership, or that the people who will be deducting the most money and getting the biggest tax break, are those with literal mansions. Not to mention the fact that vacation homes have been allowed to qualify for a deduction too. Also of note, any boat big enough to have a bathroom on it can qualify as a second home so there are millionaires deducting interest on 1 million dollars of their home, as well as another 100,000 of their yacht, and they are getting the biggest tax break. These people aren't evil, and they need not feel guilt, (hell I plan to be one of them and I'm sure many on this forum are), they are operating in their best interest and the best interest of their family given the incentives presented to them. The argument is just that maybe it's best for the economy and society as a whole if these aren't the people the government is giving the biggest tax breaks to.

Other suggested solutions include changing regressive payroll tax system (interesting implications for Social Security, more straight forward for medicare). Also possibly lowering the estate tax limit, suggesting that wealth should be earned more by individuals rather than gifted by parents.

 

[ExFlyBoy5]

I think the majority of it boils down to ending tax breaks of various kinds that go far disproportionately to the wealthy. Things that sounds good on paper but end up being welfare for the rich. For example, tax breaks on employer-sponsored health plans, home mortgage interest deductions, lower tax rates on capital gains, 529 savings, etc. These are all breaks that in theory every citizen can benefit from, but in reality only the wealthy are able to make use of.

I am an early retiree. I was an ENLISTED dude in the military and not wealthy by stretch of the mind or even in the most liberal calculations. BUT....I have "taken advantage" of several of the tax breaks you mention. I can also show you 100+ folks who I served with (also enlisted) that got generous tax breaks...such as the earned-income-credit. So, your assertion that these tax breaks are only taken by the wealthy is just not correct.

 

[mrWinter]

I am an early retiree. I was an ENLISTED dude in the military and not wealthy by stretch of the mind or even in the most liberal calculations. BUT....I have "taken advantage" of several of the tax breaks you mention. I can also show you 100+ folks who I served with (also enlisted) that got generous tax breaks...such as the earned-income-credit. So, your assertion that these tax breaks are only taken by the wealthy is just not correct.

Yeah you are right, I shouldn't have stated it that way. I shouldn't have said only the wealthy take advantage of those breaks, and instead said the wealthy get to take advantage of them, and do so disproportionately compared to the rest of the population.

 

[RunningBum]

mrWinter, now you are getting into policy and law changes, and few if any of us have ability to make those kind of changes. About all we can do is work to elect officials that favor those changes, and (edit: ) you can read for yourself what the author says about the last election. But even the author admits it's the 0.1% who have the money to actually influence elections. I don't want to venture any more into politics so I'll stop.

And if that's the author's point, why get into calling us a toxic part of the problem and taking other potshots?

Edit to add: One more point I wanted to make/ask, you aren't seriously telling us to bypass those benefits, are you? I'm not going to be the lone sucker who doesn't take fair advantage of tax breaks. Change the rules if you don't want me to have them, but don't tell me to not use them when I can be pretty certain others will continue to.