Wealth Distribution in the USA

KyussBishop · 24-10-2013 08:17PM

gaffer91 wrote: »

To be fair you don't necessarily have to start your own business to receive a high-income. Law, Medicine, Professional and Financial services are all examples of careers in which a person can plant themselves firmly among the highest earners in the country if they lack the creativity and skills needed to be a successful business leader.

Certainly - I have more in mind the top positions in corporations/companies, where the pay may become ridiculous multiples (sometimes in the hundreds) above that over the average worker.

There are different issues in some of the above, (such as, could be wrong on this one, unions restricting supply of doctors - keeping wages favourable, and fraud/decriminalization of fraud in finance) but those are separate to what I've focused on thus far.

KyussBishop · 24-10-2013 08:19PM

bluewolf wrote: »

Hmmm

http://www.admissionsconsultants.com/college/ivy_league_financial_aid.asp

Harvard is committed to meeting 100% of admitted students' demonstrated financial need.
Financial aid is available for international students.
All applicants are automatically considered for the Harvard Financial Aid Initiative, which expands aid to middle- and lower-income families. Families with annual income below $60,000 are not expected to contribute to educational costs. Families with income between $60,000 and $150,000 are expected to pay zero to ten percent. Families with annual income over $150,000 are expected to pay proportionally more.

Yale Families with annual income of $65,000 or less are not expected to contribute to educational costs

You nearly wouldn't think there's an enormous student debt crisis in the US, would you?

Wibbs · 24-10-2013 08:20PM

bluewolf wrote: »

And yet...
http://www.cato.org/publications/white-paper/private-education-is-good-poor-study-private-schools-serving-poor-lowincome-countries

http://www.cato.org/policy-report/septemberoctober-2005/private-schools-poorest-countries

That's incredibly simplistic thinking IMH. Though considering the source... Like FatBuddha.com finding "meditation is good for you".

What's wrong with their picture? A number of things, but most of al, it's not what is good about private schools that's the nub of it, it's what's bad, or lesser about public schools and how can a society change that? Where private schools exist you naturally will find smaller classes, more involved teachers(better paid, but not always), more involved parents. There is a brain drain from the public to private. This is market driven, but that doesn't mean leaving it to the market is the better option.

Look at the US and their private/public schools. How is that working out? Not so well. Every ism that's ever been points to outlier exemplars and says "see our way is better" and usually miss the bigger picture by a country mile. The "we have a hammer, thus every problem is a nail" mode of thinking.

Take an example closer to home. Gaelscoils are essentially open to all, public at varying but usually moderate or no cost, yet have far better grades and smaller classes and more involved teachers than similar public schools and eve do better than many very high cost private schools. In this case it's not the money, it's the culture of education that sets them apart and makes them better. Speaking and promotion of Irish is the environmental pressure for them to be better. Sure the market can also be an environmental pressure, but it's not the only one.

24-10-2013 08:21PM

Jernal wrote: »

Quality of living: Health, Energy and Food* aren't a issue for people. For the financial aspect, I like the expression "to have enough money that the fear of money is taken off the table". Not necessarily comparing the two pairs you mentioned above. More, posing the question about the challenges for people to have access to a standard of living that is acceptable. Should these people be facing these challenges?

*Availability of education, entertainment and other excesses are dependent on how much freedom the person has towards affording the 3 core requirements and how much of the 3 they're willing to sacrifice.

I don't really think you can legislate for people's fears can you? What if you're fairly average income and have fears anyway...?

Iwasfrozen · 24-10-2013 08:22PM

All this talk but no one can answer the question if a CEO can make many times the average worker's wage then why shouldn't they? More power to them.

Wibbs · 24-10-2013 08:28PM

Id agree with the rest of your post KB however not so much with this bit:

KyussBishop wrote: »

Unlike the word/label Libertarian, which people who that word is associated with by other posters, actually openly self-identify with that themselves (thus justifying the label)

Libertarianism is not as monolithic as some seem to think. Libertarians also may pick and choose along a spectrum, just like any other "ism". You most certainly have "hardline" Libertarians and ones who are more a la carte. You even have a Libertarian left which the Libertarians on the right would have issues with. Of course you find a spectrum, that's people for ya. And Libertarians are people? Right? Some of my best friends...

KyussBishop · 24-10-2013 08:28PM

UCDVet wrote: »

I used to have a very high opinion of the poor. I thought they were just people who were dealt a bad hand. I didn't think less of them, I just assumed they didn't have all the same advantages as other people.

Then I became a poor, dirty, immigrant. I left my nice upper-middle class, single family detached home, and got to rub shoulders with poor people.

That pretty much changed my mind completely. Sure, yes, absolutely, there are some poor people who are decent enough. For the most part though....I'm sorry, I'll gladly pay more money for the same stuff for the sole purpose of making it inaccessible to poor people. I mean, I don't want to hurt them or anything, I just don't want to be around them. And not because of their income, or not having a fancy car - I'm referring to attitudes and behaviours. Things that are FREE. Go to a park in a trashy neighborhood, and it is trashed. Go to a park in a nice neighborhood, and it's clean - even when it's cleaned on the same schedule. Just an example, there are millions more. Makes me angry just to think about it.

In the US, you get a free education until you finish high school. Then, you get (virtually) unlimited funding from the government for college. I'm not saying everyone can be rich by doing well academically, studying a practical field, and working hard. But you can certainly be not poor.

Poverty in an area can lead to escalating social trouble, especially if there are kids who get stuck with a lack of future prospects and become more anti-social, thus negatively affecting the entire area and the people there; it's not right to generalize and blame an entire subset of people like that, due to these issues which are largely out of their control.

KyussBishop · 24-10-2013 08:30PM

drumswan wrote: »

This is the crux of the libertarian argument at its ugliest. The poor are lazy and have everything handed to them by some imaginary hero-elite that the libertarian is always part of. The reality that the poor need to expend the same amount of work just to thread water in our system is ignored. Its truly nauseating.

Luckily there are only about 20 of these nuts in Ireland. Ive better things to do than argue with such cretins.

The posters who do seem to promote a "the poor deserve it" attitude, only ever seem to allude to it, they never seem to have the honesty to just state it straight-out.

There are a lot of things alluded to, but ultimately left unsaid like that - it is very cowardly.

KyussBishop · 24-10-2013 08:33PM

EmptyTree wrote: »

Cant say I'd agree with this completely, nobody every few want to see their business damaged/go toes up or would risk their business on a stupid gambl. At the higher end of the scale reputation is everything in order to move over to the next company and get paid even more

Well, taking a look at the banking and finance industry, reputation and business opportunity doesn't seem to get damaged a whole lot, even if failures in leadership damage sizable portions of entire economies.

Can't say there's much accountability imposed upon peoples reputations there.

Maximus Alexander · 24-10-2013 08:34PM

Nobody ever has a problem with the 1% after the become part of it.

clairefontaine · 24-10-2013 08:34PM

Wibbs wrote: »

That's incredibly simplistic thinking IMH. Though considering the source... Like FatBuddha.com finding "meditation is good for you".

What's wrong with their picture? A number of things, but most of al, it's not what is good about private schools that's the nub of it, it's what's bad, or lesser about public schools and how can a society change that? Where private schools exist you naturally will find smaller classes, more involved teachers(better paid, but not always), more involved parents. There is a brain drain from the public to private. This is market driven, but that doesn't mean leaving it to the market is the better option.

Look at the US and their private/public schools. How is that working out? Not so well. Every ism that's ever been points to outlier exemplars and says "see our way is better" and usually miss the bigger picture by a country mile. The "we have a hammer, thus every problem is a nail" mode of thinking.

Take an example closer to home. Gaelscoils are essentially open to all, public at varying but usually moderate or no cost, yet have far better grades and smaller classes and more involved teachers than similar public schools and eve do better than many very high cost private schools. In this case it's not the money, it's the culture of education that sets them apart and makes them better. Speaking and promotion of Irish is the environmental pressure for them to be better. Sure the market can also be an environmental pressure, but it's not the only one.

You can't generalise about US public and private schools. In many instances, many many, the public schools are academically better, but people choose the values that a private school may espouse, sometime religious, sometimes civic, etc.

Some private schools suck too. It really does depend. Some are filled with rich spikes obnoxious kids.

Nd then we have charter schools too.

Also, the public schools are tied into national testing from 2 nd grade onwards. So if a student stands out, he or she will be noticed, and this from an objective criteria which private schools don't employ, his making it more Limey for that student to enjoy benefits such as gifted program's and scholarships.

K-9 · 24-10-2013 08:35PM

Iwasfrozen wrote: »

All this talk but no one can answer the question if a CEO can make many times the average worker's wage then why shouldn't they? More power to them.

Well I doubt anybody is going to stop them. If that together with other factors means the rich get richer and the poor poorer, why shouldn't they?

Iwasfrozen · 24-10-2013 08:37PM

K-9 wrote: »

Well I doubt anybody is going to stop them. If that together with other factors means the rich get richer and the poor poorer, why shouldn't they?

Person A has no moral obligation to meet the social needs of person B.

KyussBishop · 24-10-2013 08:41PM

gaffer91 wrote: »

But you see, I think that a culture that doesn't reward success and hard work handsomely has a more harmful effect on society overall. I do agree that money can have a corrosive influence on politics and that is definitely something that a close eye must be kept on.
...
Working and middle classes are disadvantaged by higher taxes as well. Many people would find the low level at which the higher rate of income tax kicks in and things like the USC to be more than a little unfair.

Well, we're in agreement here so; I've said it a few times there, I definitely do want success in business to be very handsomely rewarded - I just think there needs to be a limit, due to the societal damage we know excessive income inequality (and the massive power over the rest of society it gives the wealthy) causes.

You can have both - handsome rewards, and limits to prevent societal harm.

A lot of posters with right-leaning views mistake me for a Marxist or something, but ultimately, I'm a big supporter of the market economy, private business, small government (ready to step in temporarily in the bad times), and possibly even complete elimination of income/corporate tax

(though not in economies as they are today - that wouldn't work)

My views on all that are pretty complex, and don't fit into traditional left/right views - though that'd have to be for another thread.

KyussBishop · 24-10-2013 08:42PM

clairefontaine wrote: »

Poverty is not a destiny.

The US has a very flexible class system and many roads inwards. I can see how you might have your views in a European context where class is more fixed and more socialist. Odd that isn't it, the more socialist a place is, the more classist it is.

That isn't true though - the US has worsening social mobility:
http://www.alternet.org/news-amp-politics/usa-usa-america-now-has-less-class-mobility-most-europe

K-9 · 24-10-2013 08:45PM

NiallSparky wrote: »

I'm somewhere in between where a lot of posters on this, and find myself agreeing with aspects of both sides.

I do believe the state has a responsibility to its citizens in this area. That responsibility for me is in limited redistribution of wealth (basic social welfare payments) and perhaps more importantly in creating an environment that promotes and facilitates social mobility. Victorian England failed here, Modern "caste system" India fails here and so do many others.

People have no inherent right to wealth that is in any way proportional to what the "1%" get, they do however have an inherent right to have the opportunity to earn that level of wealth. "Earn" is a tricky word here, as many people clearly have very different views on what this is. Seeing as such differences of opinion exist on what "earning" constitutes, it seems fairest to let the overall society, via the market system, decide on fair pay scales. Obviously, actual post-tax income is an extension of this.

So for me, income inequality is only a big issue when social mobility is also.

This OECD report gives a good indicator of levels of social mobility across its members: http://www.oecd.org/eco/growth/49849281.pdf

Thanks for that link, education is very important here and inheritance isn't as much a factor here as many other European countries going from a quick scan of it.

KyussBishop · 24-10-2013 08:49PM

bluewolf wrote: »

All I've seen on the last two pages is "you can't do anything if you're poor, you can't even get into an IL college" which is demonstrably untrue. It was CF's point, and I don't think she was far off the mark with it either. If you're being told a lot you can't do anything or go to college or that you can't run a big company ever or whatever else because you're poor, it might well introduce a psychological barrier. in combination with the other points raised especially

Nobody is saying it can't be done, people are pointing out the very real barriers - these barriers don't stop success, but they greatly skew in favour of the 'top percentiles', and to the disadvantage of the 'lower percentiles' - it's not a level playing field.

It's a problem that doesn't seem to get acknowledged, just deflected from - it's a problem people of a Libertarian perspective would need to provide solutions for as well in their preferred system.

Sleevoo · 24-10-2013 08:50PM

KyussBishop wrote: »

And this supply is constrained, largely to those in the 'top percentiles', who have more favourable opportunity to develop the right skills, with those in the lower percentiles having much higher barriers to entry.

Lets also point another thing out: There can only be so many businesses out there, because labour is limited - this puts a constraint on 1: the number of businesses, and 2: the size of businesses.

This limits the supply of managerial/CEO jobs, and restricts the number of people who get the opportunity to take those jobs - these are not jobs open to contesting from the markets, mostly they are hierarchical, with pretty high job security - certainly, when managers/CEO's do a bad job, often the company ends up covering their ass rather than firing them, so I'm not convinced it's all down to skill/merit at all (in a lot of cases it is, though equally, in a lot of cases it is not...).

This would lead me to think, that it's not the number of capable of qualified leaders out there that is of limited supply, it is more the jobs.

Whats stopping someone getting skills?

Study hard and save up for college fees.

I keep hearing about the unfair advantages others have. Thats life some people have an advantage. So what, stop worrying about other people, there is nothing nothing stopping you from being financially well off. Study hard, save, do a course or learn a craft. Don't waste your time like most people watching tv.

Children of rich parents may have an advantage, but they are often disadvantaged by never having a work ethic instilled in them. Succesful people often have an emotional framework in place whereby they feel good putting in the hard work. This never develops when you are given everything without having to work for it.

But back to advantages, we live in the best time of the history of the planet to be alive. Imagine telling egyptian slaves a few thousand years ago about the plight you must endure in this modern world.

KyussBishop · 24-10-2013 08:51PM

K-9 wrote: »

Oh they do, no argument from me on that. My argument would be that resources are wasted on waste like that and should be targeted at the actual delivery of the health service, others just see cut, cut, cut.

Ya good point: When people talk of 'fixing' any public service due to waste, they never talk of redistributing the wasted resources into more useful areas (which badly need more resources), but of cutting resources/money altogether.

That shows a motive, that isn't anything to do with solving waste or improving service, but of a more ideological motive, of just wanting to get rid of public service.

Amirani · 24-10-2013 08:52PM

clairefontaine wrote: »

You can't generalise about US public and private schools. In many instances, many many, the public schools are academically better, but people choose the values that a private school may espouse, sometime religious, sometimes civic, etc.

You can't generalise about US public and private schools and yet you can generalise about the entire continent of Europe.

K-9 · 24-10-2013 08:52PM

Iwasfrozen wrote: »

Person A has no moral obligation to meet the social needs of person B.

Well all you have to do is the change the system here or maybe move to a country that has a similar belief system, Hong Kong or Singapore seem good examples.

Wibbs · 24-10-2013 08:54PM

Iwasfrozen wrote: »

All this talk but no one can answer the question if a CEO can make many times the average worker's wage then why shouldn't they? More power to them.

Ok I'll bite

Why not indeed? I mean if we could get away with it we likely would. Actually I think this higher pay will start to be reduced as shareholders start to see that many CEO's and higher execs, especially bought in ones actually don't do so well for the companies. This high pay/bonuses stuff is more a tradition rather than raw market forces(which is ironic in of itself). If mapped against actual results then many CEO's might face a paycut, even in some cases the sack by the shareholders.

Steve JObs and Apple were mentioned earlier. That company is a good example of CEO's fcuking up more than winning, yet still getting the big bucks. Apple is huge now, but younger viewers may easily forget how close to going into the bin they were. While the company was driven by Jobs in the early days, he nearly drove it into the ground too. His absolute faith in the Macintosh system nearly killed them. They kept making Apple 2's because they were the only things selling. Soon after John Sculley(a bought in exec) and the rest of the board neutered Jobs so much he left. They were right to BTW, but how they did it, they could have handled it better.

Then we had the 90's. Where the ceo and execs really screwed up all over the place. Then they bought in another ceo Amelio, who buggered them even more. All of these guys were very very well paid, yet their results were clearly lacklustre at best. Basically a core set of fanboys kept the company going by buying their products. The market should have informed the shareholders that these guys weren't performing, but people weren't listening or listening enough.

Their fortunes were reversed only when Jobs came back, older and a lot wiser and proceeded to strip out the BS*, the board, the high end execs in exchange for actual performers. Now he's dead, mark me that same old guff will happen again. If not worse as hubris will be stronger,

This is a good read on the subject(PDF file)

TL;DR? I don't blame "capitalism" or the "market" for overinflated ceo and other exec wages(costs really), I blame human nature, a historic system, bragging rights between companies(we pay our execs more), uninformed shareholders and those who don't want to rock the boat. Among them the CEO class of course. Turkey's aint gonna vote for xmas.

* the list of inefficiencies, nay gross stupidity that Jobs found when he came back and had a look around floored him. EG Amelios secretary didn't even have a direct line to the top guys at their CPU suppliers Motorola. She had to ring directory enquiries. In a 40 page internal "how the hell are we doing" documnet he commissioned the information that Apple was the worlds biggest supplier of goods to the education market was buried on page 20 and details of their fixed and high value assets was buried even deeper.

clairefontaine · 24-10-2013 08:55PM

KyussBishop wrote: »

Nobody is saying it can't be done, people are pointing out the very real barriers - these barriers don't stop success, but they greatly skew in favour of the 'top percentiles', and to the disadvantage of the 'lower percentiles' - it's not a level playing field.

It's a problem that doesn't seem to get acknowledged, just deflected from - it's a problem people of a Libertarian perspective would need to provide solutions for as well in their preferred system.

Of course there are barriers, of course there are inequalities. That's life and no point pretending otherwise.

But telling people over and over and over again about closed doors and lack of access yadda yadda yadda, that they cant achieve something or get access to something,is only going to convince them that they cant.

Sure you may have to work a little harder, study a little harder, make compromises others don't have to, so do it! What other choice is there? Wait for someone to do it for you? Sit around and feel sorry for yourself while those professors up in the NE making pretty good salaries propegate more of this rhetoric of paralysis?

Door is closed, find the window.

There are no guarantees, just opportunities.

KyussBishop · 24-10-2013 08:55PM

UCDVet wrote: »

100% correct.

In addition to school specific programs, the US Federal Government backs all of the student loans. People in the US don't pay to go to college, and they don't need jobs or credit history. They fill out paperwork and wait for their check. Each year they can get more and more money.

The idea that poor people can't afford to go to college in the US is crazy.

There are lots of US students at UCD who borrow 80k USD per year, for their educational costs. And they are posting pictures of their fancy holidays and yacht cruises. All financed with their student loans.

They get more and more debt. As I posted in a reply earlier, there is an enormous student debt crisis in the US, as a result of this - one which could cause another economic crisis down the line if it blows like the housing bubble did.

clairefontaine · 24-10-2013 08:56PM

KyussBishop wrote: »

They get more and more debt. As I posted in a reply earlier, there is an enormous student debt crisis in the US, as a result of this - one which could cause another economic crisis down the line if it blows like the housing bubble did.

yeah, you know why? All the subsidies created a way way over inflated market.

donegal__road · 24-10-2013 09:07PM

Maximus Alexander wrote: »

Nobody ever has a problem with the 1% after the become part of it.

unless of course, you happen to be the president of Uruguay who gives 90% of his income to charity.

*I know Uruguay is not the USA.. but if he lived there he would qualify to be a member of the 1% club.

KyussBishop · 24-10-2013 09:10PM

UCDVet wrote: »

To be fair, I think everyone has examples of how someone coming from a rich family ended up putting them on top. All of the most successful people I know, if you really get to know their story, they really owe their success to someone else.

True story (anecdotal, I know, but I like it)...
...

Good post

I wouldn't begrudge him that success either, as (even if he got a significant helping hand) he's still got that company put together and running successfully now, so certainly deserves good reward for that.

While wealth begets more wealth, and it gets passed along in families and gives advantages like that, I don't think that is something that specifically needs to be clamped down on - but what is important I think, is being able to factor this in, and set some limits (to salaries say) to prevent income inequality being too great and getting perpetuated - because we know that harms opportunities for the less well off even more (and limiting it, would just be preventing an even greater imbalance in the playing field).

Wibbs · 24-10-2013 09:10PM

Iwasfrozen wrote: »

Person A has no moral obligation to meet the social needs of person B.

Maybe not, but wider society does or should. Otherwise it may as well be a free for all. Fine if you win, but what if you don't? Of course that's just my opinion, such as it is, but I for one think there's enough I'm alright Jackism in the world as it is.

Actually I'd knock my previous rambling tome down to one line; a society should strive for equality of opportunity, the rest will tend to flow from that.

diomed · 24-10-2013 09:10PM

1% own 40%, 99% own 59% 60%.

Do you expect 1% to own 1%, and 99% own 99%?

Sleevoo · 24-10-2013 09:11PM

KyussBishop wrote: »

The posters who do seem to promote a "the poor deserve it" attitude, only ever seem to allude to it, they never seem to have the honesty to just state it straight-out.

There are a lot of things alluded to, but ultimately left unsaid like that - it is very cowardly.

Or maybe thats something you are imagining.

Wealth Distribution in the USA

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