Wealth distribution in the US

[garbon]

I don't know why they would think they should be raising children on a minimum wage. They barely have enough (/not enough) money to take care of themselves.

Yet millions do.

An entirely different discussion.

I don't think it is. In fact, I think it's definitely part of the discussion. If those making minimum wage cannot afford to live by themselves, how can we expect families to survive when they're forced into those jobs? That is, I think, exactly what this discussion is about.

I don't think anyone expect families to live solely on minimum wage.

Also this discussion seemed to be about the wealthy pulling away from the rest of us not that the rest of us are all declining into squalor.

[MadImmortalMan]

So apparently the easy way to guarantee upward mobility is to live on top of shale oil deposits.

Can't that be read also as some of the bluer regions having less difference between bottom and top quintiles? Getting to the top quintile in some of the bigger metro areas (NY, LA) must be pretty fucking difficult, no matter how many opportunities you have, while the same in Bumfuck, ND, should be much easier.

Maybe it'd be much more instructive to have the same map but with the middle quintile as target, rather than the top one.

But NYC for example has a pretty decent rate of upward mobility.

No, the dark blue areas coincide very nicely with the areas undergoing a boom due to shale fracking.

By the way I think you'd get a similar effect in parts of Alberta.  Working in the oil patch = money.  You have plenty of farm kids pulling in incomes higher than mine.  You'd easily be in the top quintile if you work in the patch.

Being willing to do something like moving to Bumfuck, ND is exactly the kind of thing that sets most of us apart from the people who excel.

[The Minsky Moment]

The poor aren't getting poorer . . .Everything from super power computers, cheap cars better than the nicest Ferrari from Magnum P.I., and medical procedures and treatments people in 1980 would have killed for; this idea that the poor are getting poorer is largely unproven, and just accepted as an article of faith. [Wages haven't even truly been stagnant, average real wages are up 10% from the 70s and median wages are up 4%.]

First of all, an increase of 4% (or even 10%) over a period of 40 years is negligible, not materially different from zero.  "Stagnant" is a very fair description of that degree of growth.
Second, as you go into some of the lower strata, the increase may be even lower.
Third, it is true that for some goods there have been hedonic improvements that can fairly be counted as increases in the quality of living.  But it is far from "everything".  Healthcare, electronics, white goods, arguably transport, yes.  But housing in many urban cores has gotten more expensive, displacing workers outward for a net loss in their quality of life.   The quality of certain key public services - namely public education, has declined at the primary and secondary level and become much more costly at the tertiary level.  There are other difficult to define factors which may have a negative impact: declining job security, the increasing use of multiple part time jobs to maintain income, the shift away from defined benefit pension structures, to take a few examples.
How all these factors weight against each other isn't immediately clear.  In some ways working people may be better off, in other ways not.

[The Larch]

So apparently the easy way to guarantee upward mobility is to live on top of shale oil deposits.

Can't that be read also as some of the bluer regions having less difference between bottom and top quintiles? Getting to the top quintile in some of the bigger metro areas (NY, LA) must be pretty fucking difficult, no matter how many opportunities you have, while the same in Bumfuck, ND, should be much easier.

Maybe it'd be much more instructive to have the same map but with the middle quintile as target, rather than the top one.

But NYC for example has a pretty decent rate of upward mobility.

No, the dark blue areas coincide very nicely with the areas undergoing a boom due to shale fracking.

By the way I think you'd get a similar effect in parts of Alberta.  Working in the oil patch = money.  You have plenty of farm kids pulling in incomes higher than mine.  You'd easily be in the top quintile if you work in the patch.

If the top quintile is the same all over the country, it explains how people from the big cities have a higher chance to get there, which doesn't necessarily mean that they're in the top quintile of the city.

[Admiral Yi]

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 would argue that the causality does not run from distribution to wages, but rather the reverse.  The fact that Warren Buffet is worth several billion is not causing my wages to stagnate, but instead my stagnate wages are impacting my ability to accumulate wealth.

The second part to me is the heart of the matter.  Wealth distribution matters because we say it matters, much like the way a winning or losing sports team we root for matters.  It's a widely held organizing principle.  The top 1% holding 40% of wealth is bad because we say it's bad.

The old promise of the American dream was that if you worked hard and played by the rules your children would have a better life than you had.  It was not that they had a chance of becoming a Rockefeller or a Getty.  And the fact that now it is harder and harder to become a Gates or a Buffet is not primarily a function of the unfairness of the rules (though I agree there are some ways in which the rules are rigged--legacy admissions is my favorite) but rather a function of the fact that the distance to travel from 0 wealth to billions is further than the distance from 0 to millions.

[Ideologue]

Is the position being put forth that because of the disparity those of us without such wealth are being forced to live in much worse conditions than we were previously accustomed?

Of course it is.  Don't be one of those people who says because poors can afford a microwave or have access to refrigeration, things are better than they ever were.

[Camerus]

I don't know why they would think they should be raising children on a minimum wage. They barely have enough (/not enough) money to take care of themselves.

Yet millions do.

An entirely different discussion.

Not really.  Any system that holds that poors oughtn't to have kids is neither realistic nor equitable.

[Berkut]

The second part to me is the heart of the matter.  Wealth distribution matters because we say it matters, much like the way a winning or losing sports team we root for matters.  It's a widely held organizing principle.  The top 1% holding 40% of wealth is bad because we say it's bad.

No, it is bad because it allows the top 1% to hold a ludicrously disproprotionate level of power and control over society in general. So much in society is driven by your ability to influence via access to wealth that allowing these kind of radcial income distributions is in fact damaging, and in fact I would argue that letting it get to some fraction of what it is at now is very much why the number has gotten to where it is at now. And is what will likely allow it to continue.

I do not have any illusions that this increase is also happening at the same time poltiical contributions to parties has exploded as well, and the laws governing those contriobutions have at the same time been continually relaxed.

Now, whether uber rich Dude #1's candidate or uber rich Dude #2's candidate wins the ensuing election is of great interest to them, what we can be sure of is that ALL the candidates will be funded by some uber rich dude or another, and there won't be a candaidate for the non-uber rich at all. Already we see that the relevance of smaller donors is becoming less and less, and hence policy makers are becoming less and less beholden to the masses.

This is just one example of course, albeit a critical one.

It is NOT important just because we think it is important. It is important because relative concentrations of wealth go right along with relative concentrations of power and control.

[merithyn]

No, it is bad because it allows the top 1% to hold a ludicrously disproprotionate level of power and control over society in general. So much in society is driven by your ability to influence via access to wealth that allowing these kind of radcial income distributions is in fact damaging, and in fact I would argue that letting it get to some fraction of what it is at now is very much why the number has gotten to where it is at now. And is what will likely allow it to continue.

[Ideologue]

$14.50.

I was like Croesus, with my no house and car from 1999.

[alfred russel]

Aka a society that'll never happen (/sounds like a nightmare) as people higher up the ladder aren't going to want such instability for their children.

It will obviously never happen as it is impossible to achieve same starting chance in life.

But I am not sure what sounds like a nightmare about a perfect meritocratic society. Everybody making their own destiny based on their ability sounds like a good thing to me.

It implies that family and parents have by some mechanism been made unable to contribute to the success of their children. It gets down to an almost philosophical question: what is "ability"?

If it is genetics, then perhaps there will be perfect social mobility in our future gattica world, though I am unsure that whatever genes contribute to "ability" are evenly distributed across income groupings.

If it is knowledge, work ethic, social skills, etc, as determined at some future point in life, then it almost certainly won't be perfect social mobility. Parental impact is going to have a major role. Parents who earn higher incomes should be (on average) better teachers of skills that result in higher incomes, and also have the resources to have others help where they can not.

[ulmont]

Which can be looked at as a bit silly in and of itself. Even the rich in 3rd world hellholes like Georgia only make like, $14/hour. I think.

I get billed out at somewhat higher than $14/hour, but if you're just looking at what I get paid that sounds about right.

[Ideologue]

Which can be looked at as a bit silly in and of itself. Even the rich in 3rd world hellholes like Georgia only make like, $14/hour. I think.

I get billed out at somewhat higher than $14/hour, but if you're just looking at what I get paid that sounds about right.

[Admiral Yi]

Berkut:

First, I think you're overstating the case.  We just went through an election in which unfettered fat cat money was predicted to buy the election, and the fat cat candidate got stomped.  A rich old Jew tried to buy the GOP nomination for Newt, and Newt got stomped.  Congress, a house controlled by the fat cat party and ostensibly beholden to their paymasters, recently passed a tax increase on anyone making more than $450,000, ostensibly the one policy area that fat cats cared about most and expected the most return for campaign money.

Second, there is quite a bit of circularity in the argument.  Let's assume for the sake of argument that the thing that fat cats care about most is staying fat or getting fatter, and that they will spend their campaign money in the hopes of achieving this end.  As I already said, this didn't work out, but leaving that aside, your objection to unequal distribution is that it will be leveraged to create even more unequal distribution.

[Berkut]

Berkut:

First, I think you're overstating the case.  We just went through an election in which unfettered fat cat money was predicted to buy the election, and the fat cat candidate got stomped.  A rich old Jew tried to buy the GOP nomination for Newt, and Newt got stomped.  Congress, a house controlled by the fat cat party and ostensibly beholden to their paymasters, recently passed a tax increase on anyone making more than $450,000, ostensibly the one policy area that fat cats cared about most and expected the most return for campaign money.

Second, there is quite a bit of circularity in the argument.  Let's assume for the sake of argument that the thing that fat cats care about most is staying fat or getting fatter, and that they will spend their campaign money in the hopes of achieving this end.  As I already said, this didn't work out, but leaving that aside, your objection to unequal distribution is that it will be leveraged to create even more unequal distribution.

You really think the uber rich give two shits about income tax?

Please, that is just plain naive. The fat cat candidate most certainly won - you can't BE a candidate in this world without being a fat cat's candidate. Uber Rich Dude #2 beat out Uber Rich Dude #1.

And really, if you want to argue that forever increasing relative wealth disparity (I guess it can't increase forever, at some point the richest 1% will own everything, I guess at that point it can stop?) is not a problem, I don't even think we have common ground of any kind to even have a discussion. I am rather astounded that you will hold  up the outcome of the last election to "prove" that the wealthy becoming more wealthy somehow has no effect, while ignoring the fact that the wealthy have increased their share of the wealth by an order of magnitude as being somehow unimportant to the discussion.

You are arguing that this is simply not an issue - the uber rich increasing their ownership of the nations aggregate wealth by an order of magnitude simply doesn't matter, and pointing out that some of them had a trivial tax increase as evidence that them having insane wealth doesn't actually give them power? If they didn't have an insane amount of power, I suspect we would have a racially more progressive tax system.

The fact that they are contiunally growing that power and wealth simply demolishes any claim that somehow it "doesn't matter". THEY certainly seem to think it matters.