Wealth distribution in the US

[Valmy]

Just curious what is a good number for this?  10%?  15%?

[The Minsky Moment]

You need to know why something happened before you can come up with good fixes.

That is very hard to do.  There are lots of variables to track and there isn't any way to re-reun history as a controlled experiment.

The problem if anything is understated.  It is not just that there is a consistent long-dated trend of increasing income *and* wealth dispersion.  Money incomes of working class strata are actually stagnant and over some periods declining.  And most studies to examine the question also report findings that social mobility (measured in economic terms) has declined. (EDIT Thanks Jake for the map)  This is not a sustainable trend in a democracy.  People can tolerate a certain degree of inequality if they have some reasonable hope that their children can rise to the top.  But if that hope seems improbable, eventually there will be a reaction.

I agree with Berkut that redistribution by taxation seems less than optimal as a solution that treats symptoms over causes.  But I admit I don't have a better solution to offer.  But one thing to keep in mind is that the income and wealth flows we see are not the result of some open system of free competition.  The American economy is laden with distortions to competition and subsidies both open and hidden.  Exactly how this impacts ultimate flows of income and assets and hard to say with precision.  But one could take a guess.

[garbon]

The answer seems to be a combination of fracking and mormonism. 

SLC doesn't seem to fare much better than SF.

[derspiess]

My local school district is quite good, and well-funded.

[The Minsky Moment]

My local school district is quite good, and well-funded.

And therein we can see the root of one of the problems.

[alfred russel]

The answer seems to be a combination of fracking and mormonism. 

SLC doesn't seem to fare much better than SF.

It must be that big city living is eroding the strength of their faith.

[DGuller]

Just curious what is a good number for this?  10%?  15%?

I'm curious too.  Seems like 10% is a reasonable number, but looking at just US can skew our perspective.  Obviously it has to be less than 20% in a stable environment (with no shale oil and such), since otherwise that would imply that a top fifth are getting regularly dekulakized.

[Barrister]

The answer seems to be a combination of fracking and mormonism. 

SLC doesn't seem to fare much better than SF.

It must be that big city living is eroding the strength of their faith.

I have read that SLC is becoming much more cosmopolitan than it used to be, and more like the rest of the country...

[garbon]

Just curious what is a good number for this?  10%?  15%?

I'm curious too.  Seems like 10% is a reasonable number, but looking at just US can skew our perspective.  Obviously it has to be less than 20% in a stable environment (with no shale oil and such), since otherwise that would imply that a top fifth are getting regularly dekulakized.

Perhaps but I think this might obscure more than it helps. After all, if you just need 10% then looking at the map, there isn't a social mobility problem for most of the nation.

[garbon]

The answer seems to be a combination of fracking and mormonism. 

SLC doesn't seem to fare much better than SF.

It must be that big city living is eroding the strength of their faith.

I have read that SLC is becoming much more cosmopolitan than it used to be, and more like the rest of the country...

They did have more gay bars than I expected when I visited.

[Ed Anger]

I'm assuming the Ohio one will get less red as the shale oil and gas ramps up in the northeast corner of the state.

[fhdz]

Rather than taxation, it seems to me that we should be looking at the other kinds of benefits that the super-wealthy have essentially "purchased" from our government - subsidies, loopholes, exceptions that are tacked on as riders to bills, etc. - through hardcore lobbying. If people want a capitalist system, then the rules need to be fairly applied to everyone.

Doesn't it stand to reason that if you want to fix a gross inequality the best thing to do is start cleaning up corruption?

[merithyn]

I have read that SLC is becoming much more cosmopolitan than it used to be, and more like the rest of the country...

It has a growing tech industry going on there at the moment. Max applied to a number of jobs out that way.

[Malthus]

You need to know why something happened before you can come up with good fixes.

That is very hard to do.  There are lots of variables to track and there isn't any way to re-reun history as a controlled experiment.

The problem if anything is understated.  It is not just that there is a consistent long-dated trend of increasing income *and* wealth dispersion.  Money incomes of working class strata are actually stagnant and over some periods declining.  And most studies to examine the question also report findings that social mobility (measured in economic terms) has declined. (EDIT Thanks Jake for the map)  This is not a sustainable trend in a democracy.  People can tolerate a certain degree of inequality if they have some reasonable hope that their children can rise to the top.  But if that hope seems improbable, eventually there will be a reaction.

I agree with Berkut that redistribution by taxation seems less than optimal as a solution that treats symptoms over causes.  But I admit I don't have a better solution to offer.  But one thing to keep in mind is that the income and wealth flows we see are not the result of some open system of free competition.  The American economy is laden with distortions to competition and subsidies both open and hidden.  Exactly how this impacts ultimate flows of income and assets and hard to say with precision.  But one could take a guess.

Has anyone done a similar type of study for Canada? My impression is that the situation is nowhere near as severe up here, but I lack hard data.

[garbon]

You need to know why something happened before you can come up with good fixes.

That is very hard to do.  There are lots of variables to track and there isn't any way to re-reun history as a controlled experiment.

The problem if anything is understated.  It is not just that there is a consistent long-dated trend of increasing income *and* wealth dispersion.  Money incomes of working class strata are actually stagnant and over some periods declining.  And most studies to examine the question also report findings that social mobility (measured in economic terms) has declined. (EDIT Thanks Jake for the map)  This is not a sustainable trend in a democracy.  People can tolerate a certain degree of inequality if they have some reasonable hope that their children can rise to the top.  But if that hope seems improbable, eventually there will be a reaction.

I agree with Berkut that redistribution by taxation seems less than optimal as a solution that treats symptoms over causes.  But I admit I don't have a better solution to offer.  But one thing to keep in mind is that the income and wealth flows we see are not the result of some open system of free competition.  The American economy is laden with distortions to competition and subsidies both open and hidden.  Exactly how this impacts ultimate flows of income and assets and hard to say with precision.  But one could take a guess.

Has anyone done a similar type of study for Canada? My impression is that the situation is nowhere near as severe up here, but I lack hard data.

Who cares about Canada?