$1 million vs. $1 billion compared as a road trip

Originally published at: https://boingboing.net/2020/07/20/1-million-vs-1-billion-comp.html

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I’m so confused. It seems to be about US$, but he drives on the left side of the road! That’s like mixing metric and imperial units.

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That rice comparison gives meaning to the phrase “eat the rich…”

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Just last night my friend and I were laughing at how ridiculous it is for an individual to strive to be a billionaire. The amount of money is so absurd that anyone who accumulates that amount and doesn’t give most of it away to charity should be an object of mockery.

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Hey Tom…

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I’m not sure I get all the “wow that’s so much bigger than I thought” million and billion comparisons.

A billion is one thousand times bigger than a million.

One minute to walk the length of a stack of a million dollar bills.
1000 minutes’ walking (16.66 hours) for a billion bills
To do it in 75 minutes you need to be going 13.333 times as.fast as walking pace.
Let’s say walking pace is 3mph, so it would take about 75 minutes at pretty much 40mph.

And…?

(No I did not watch any of the video. Why don’t people know what a thousand times as big means? Maybe I’m having a bad day.)

Now, if we were using the old British definition of a billion - a MILLION million … :wink:

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It’s the difference between working it out and saying “yes, that makes sense” and seeing a linear analogy and saying “wow, that’s a big difference”. Intellectual vs. visceral.

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It’s not British, it’s the entire rest of the world’s definition

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People in general do not have any comprehension of this difference.

Ask someone, if they won a million dollars today:

  • How many vacation homes would they buy?
  • How big a yacht would they buy? Just plain, or a mega one?
  • Would they buy their parents/grand parents a new home?
  • How big of a house, compound really, would they build with private gated drive?
  • Would they build an entire personal water park or just a large pool?
  • Would they quit their job and NEVER work again?

With a billion, all of those are possible. With a million, enjoy the large pool but don’t count on it being a wave pool, hope mom wants a tiny house, and don’t quit your day job.

Yes, the million would be life altering, but a billion would be LIFE ALTERING.

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Or maybe “a million dollars has the potential to profoundly alter the life of an individual person, a billion dollars has the potential to profoundly alter the life of an entire society.”

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The life altering qualities of vast fortunes should get its own graph. Up to a certain point, each new dollar added to the stack will alter the life of the owner -for the better (we presume).

Then theres a point where more money just means more people’s lives are altered… and not for the better.

I think by the time you get to the top slice of the one percent, more money added just makes everybody’s life worse… but Skynet becomes more palpably real.

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Humans suck at comprehending very large numbers. Studies have shown that most people cannot grasp the enormity of scale between one thousand, one million, and one billion. When asked, they will wildly misjudge the halfway points between each because they lack a comparative frame of reference. It’s because our minds are hardwired to try and compare conceptual ideas to some kind of physical reference point or dataset.

We can easily visualize a hundred of something. A thousand is more difficult but doable. Getting into the millions and billions though and none of us have ever observed any grouping of anything at that scale. Gigantic numbers can only exist in conceptual form.

https://onlinelibrary.wiley.com/doi/abs/10.1111/cogs.12028
https://www.livescience.com/26870-ginormous-numbers-boggle-the-mind.html

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I guess I lack viscerality. ;-(

If you’ve got $1 billion, you’re almost as well off as if you were rich.

While I agree that getting a million dollars is good, and not to treat it as nothing.

The entire point is, people have a hard time telling apart the millionaire and the billionaire in their expectations.

People think they can do all those things with a million dollars. They think the guy with a million is just like the guy with a billion. Which is totally messed up.

The perception is the millionaire is living the lifestyle of the rich and famous, jetting about, has vacation homes, a yacht, hangs out with famous people, get’s private concierge medical care. When, none of that is true. Because a million is so much less than a billion or a hundred million even. Which seems obvious that it’s 1,000 times or 100 times less. It’s that a million is 1,000 times more than a thousand and most people can image a thousand dollars. So, having a 1,000 times that known thing is amazingly more. So much so, that having a 1,000,000 times that known thing doesn’t register as any different.

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It is for a lot of millionaires, because people who have far shy of a billion dollars are still able to do those things. It’s just not generally true for someone who has a mere one million dollars to their name.

That’s what people mean when they say “the very existence of billionaires is the sign of a broken system.” Because even the most hedonistic, self-absorbed lifestyle imaginable should be someone a person could attain for less than a billion dollars.

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Another way I’ve seen to explain this is that “The difference between a million dollars and a billion dollars is roughly a billion dollars.”

The difference is so vast that the life-altering sum of a million dollars is a rounding error.

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It is, but it’s still a lot of money for 90% of people out there and it allows you to do a lot of things they can’t (most notably, have access to investment opportunities that make you even more money).

Somewhere between $1-million and $1-billion, at the lower end of that range, there’s a zone called “f*ck-you” money. Here’s a monologue about it from an otherwise bad remake of a good movie:

$2.5-million is the low end of f-u money. It gives you a nice comfortable life and opportunities to build capital that others don’t have. At the high end is the area defined by Sanders and Warren in their tax proposals: somewhere around $30-50 million in net worth. And seriously, no individual needs more than that (in that range you’re making $1.5-2.5-million a year without lifting a finger), let alone 20x-plus that amount.

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We need some new names, or maybe I just don’t know them.

Someone with 1 to 9.999 million.
Someone with 10 to 99.999 million.
Someone with 100 to 999.999 million. This one is probably a hundred millionaire.

Cause, yes, anyone in that third category is probably far shy of a billion dollars, but they still have 100 to say 700 times more than the the person is the first category. Lumping them in together isn’t helpful.

On the shear scale of every millionaire in the country, there’s way way WAY more in the first category than the last.

Yes, it definitely is. And, on the scale of the privilege it brings and the amount of friction it reduces, it’s amazingly huge.

That starts even earlier. I would argue that real comfort starts when you can go to the grocery store or a restaurant and buy whatever you want (within reason) and simply not worry what the register will ring up at.

I agree with them. Which is also why they’re so focused on the $50 million, $100 million, and $1 billion.

Most of these visualizations are about showing that difference. People can imagine, and some, more each successive generation in a family, will get to a million dollars. Almost none will ever get near $100 million. Getting these people to understand that this policy isn’t crashing their or their kids dreams is part of what they’re for.

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The financial services industry has its own designations: High Net Worth Individuals (HNWIs, currently $1-30 million in liquid, investable assets) and Ultra-High-Net-Worth Individuals (UHNWIs, currently $30-million+ in investable assets). There are probably also unofficial categories for people with over $100-million.

I’ve also heart the informal term “decamillionaire” for someone with a net worth of over $10-million.

True, and even at the base $1-million in liquid assets we’re talking about we’re talking about the top 12% in the country in terms of net worth.

One thing you quickly learn about wealthy people who stay wealthy, though, is they pay very close attention to what the register rings up. And the wealthier the customer, the harder it will go on the sales clerk or server if there’s a discrepency between what he expects in terms of price and value promised and what’s delivered – even if it’s for a relatively inexpensive thing like a restaurant meal.

And it bears repeating that the higher income tax proposed by Warren fit into the progressive taxation system.

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