I saw a magazine cover reporting on the Occupy Wall Street protests with the words, "We are the 99%." These words have been kicking around in my head for a few days, but probably not for the reason the protesters would like.
Is it really possible that 1% of Americans are wealthy? According to census data, the top 1% of earners make more than $390,000 a year. I would certainly consider that wealthy. I've also done a little googling and found a statistic that's likely out of date that says that 4% of all US households have assets greater that $1,000,000. This could be properties, businesses, etc. For instance, a farmer with a lot of land could easily have $1,000,000 in property, but be nowhere near that in annual income. Still, it ain't chump change.
If you stop and think about it, these numbers are pretty amazing. Has there ever been a society in human history were 1 person out of every 100 was wealthy? 100 people isn't a very large crowd. Can wealth really be that widespread?
If we do have a system that can allow 1 person in 100 to attain this level of wealth, I would argue that we should be very careful about messing it up. 1 in 100 are really pretty swell odds. A hell of a lot better than a lottery ticket.
What a great country!
Hear! Hear! (or is it here! here!)
ReplyDeleteRegardless, well said!
I can whole-heartedly agree with that! Reason TV (a libertarian-leaning site) has an interesting video series featuring Euro Pacific Capital's Peter Schiff -- as he talks with OWS folks.
ReplyDeleteI think it's actually more like 4-5% who are significantly wealthy. It's just the 1% who have accumulated huge assets.
ReplyDeleteWhile there has been an increasing disparity in wealth distribution over the past few decades, the poor have become richer, too. It's more a case of unequal growth than the poor getting poorer. Which doesn't really seem sensible to me to complain about.
Not that there aren't issues to protest. I do think some increased regulation could help people not get into huge debt for things that have little inherent value -- overpriced houses, useless college degrees, inflated medical procedures.
It sure would be nice if the protesters understood a bit about economics, though. :( If you care about being well-off, capitalism is a GOOD THING.
It could be argued that regulations helped make the bubbles in housing, education, and medicine. Food also. America has a corn bubble. Almost anything I can think of that the government tries to make affordable seems to wind up costing more in the long term.
ReplyDeleteI do think that some of the more coherent of the protesters in the Occupy movement have a point I wholeheartedly agree with. Too often, the government funnels money directly to protect the interests of certain well connected industries. When Borders went out of business due to mismanagement and a changing business environment, there was no last second bailout bill designed to keep hundreds of stores open and thousands employed, or to insure that Borders business partners were paid the debts due them. But, when GM faced pretty much the same problems, lawmakers bent over backwards to throw billions to keep the company afloat. Or, when the value of my house fell along with all the others in the market, I wound up selling it at what was in reality a loss, if you add in the money I spent on improvements to the place. The government didn't step in to cover my financial bad break, but when investment firms found that they had bought mortgage debt that exceeded the value of the underlying properties, the Bush administration went to congress with a 700 BILLION dollar plan to bail them out.
ReplyDeleteThis reckless use of tax dollars to spare politically favored industries is a source of well deserved outrage and is, I think, the common thread tying both OWS and the Tea Party. Whether outrage will prove sufficient ot produce actual change, who knows?