Median family income in the US is about $50,000 a year now. If the income distribution were the same as it was in 1970 median family income would be about $90,000 a year.
I've been ranting about this video on Facebook for months as various friends have posted it. It's a beautiful graphic presentation and I agree with the general premise (that disparity is out of control and that's not good). But the video itself confuses issues, misrepresents facts, and misquotes academic papers. It's like the liberal, aesthetically pleasing version of a Glenn Beck presentation.
I'm sick of it. This country needs a big fat re-org. People in power today need to lose it all tomorrow or yesterday for that matter.
The video seems to use the terms "wealth" and "income" interchangeably. But personal income is a lousy measure of wealth. Consider a married billionaire with a family for which he is the breadwinner. He will be placed to the right of the chart but his children, wife, and other dependent family members will be categorized as poverty stricken. Personal income varies from year to year especially at the extremes. A dollar goes further in some parts of the country than in others--especially in housing. People tend to accumulate wealth until retirement age and then it heads down.
A much better measure would be household wealth corrected for age and purchasing parity.
One thing is obvious to me, the idea that money trickles down is a total fallacy, it seems to pool at the top. The opposite is true, if you look at money movement, the money at the bottom changes hands with exponential frequency compared to the money at the top and has a multiplier effect on the economy as a whole.
I realize that the statistics this is pulled from only counts household incomes and does not count dependents and children and that makes the distribution even worse when you divide the incomes by household members, but that would make things much more difficult to calculate.
One fact that is left out is many of the poor and middle class families now require two working adults to earn the household income shown on the chart. Things are even worse then the chart depicts.
I think the problem is documented pretty well, but I don't see enough suggestions on what to do next. I imagine it would involve reducing credit on the middle class so they can invest in the market and in savings, so I guess it would change the federal spending focus away from defense, ss, and medicare and towards free/cheap college education, healthcare, and somehow balancing the real estate market (I have no idea how to do that either).
In some parts of the video they equate income with wealth. In other parts of the video they're actually talking about wealth and not income, but not bothering to explain how "wealth" is defined. Some of their sources define wealth as net worth, so while the creators of the video present the "shocking" revelation that the top sliver of rich people have almost infinitely more wealth than most people, that shouldn't be surprising at all, given that an enormous number of Americans (including many with above-average incomes) have more debt than assets.
My guess is that a team of excellent graphic designers with strong political consciences came across a Buzzfeed or similar listicle and decided to translate it into some more impressive infographics, but didn't bother to actually read any of the original sources or run the video by any of their economist friends.
Why am I unable to unlike something? It happened in the wrong spot.
I suppose this is merely anecdotal, but whether or not the video is factually accurate, people in general have a hard time grasping the true inequality in our system. I have a friend who owns a very successful company that he inherited from his father. He has worked hard to turn the company from mildly successful to very successful and let's just say he and his wife are considering retirement at the age of 45 - and their kids college funds are maxed. Most people when they think of the wealthy being unfairly taxed think of this guy.
But I used to work on a resort island that has vacation homes for the wealthy. Most of these vacation homes were worth millions and only used a week or two a year. Of course these homes must be furnished, and landscaped, and cleaned whether used or not. I used to look out at one of these homes every day I worked there - I never once saw a car pull up to it. One day I was working on a directory of homeowners and of course since these were millionaires I wanted to be very careful to print the correct telephone number. One house had several numbers listed. There was a separate line for the garage. When I asked about this house, I was told it was the "house that looks like a hotel," and that "He never visits." So these people, these are the 1%, or up near it - the ones who can own a house like a hotel they never bother to visit.
Has anyone else seen the documentary that came out recently called Inequality For All? Although it may at times have similar issues of confusing wealth vs income, I found it to be incredibly educational and inspirational. It doesn't have to be like this!
Go back to the original post and hit the "undo like" text next to the number of likes on the post.
That "house that looks like a hotel" is an investment. The guy didn't buy it because he loves vacationing there, although that is probably also true, he bought it because he is pretty sure the property values are going to go up.
If you have money, there are lots of ways to make money. That's ultimately why wealth tends to accumulate at the top and why you have to actively do something if you want to maintain a strong middle class and a viable lower class. Generally only governments have the power to stop it, and only if the government isn't spineless. Unions can also push back if they get strong enough. Guess what has been slowly but surely killed off in America over the past few decades?
The undo like is missing, for some reason.
From all of your likes in this thread (I see several), or just that one post? If you click on the "X people liked this post" it will tell you exactly who liked it.
I don't want to go terribly off topic here, so I'll just leave it at this, but yeah, I have done it in the past. It just doesn't appear this time. But it wasn't a terrible post, just not the intended one. It's not as if it said "Kill all the puppies!" and I agreed with it.
Traditionally, four out of five people on the Forbes 500 list of the world's wealthiest individuals got their wealth primarily from trading real estate.
All that data and no context. Do we have to accept BS if it is on the right side of an issue? I hate when this happens. A good friend, well meaning, passes along some propaganda he feels we will appreciate in common and when I don't show enthusiasm my bona fides come into question.
It's crap thinking disguised as cool dude musings.
He is using the availability heuristic to invent a point about wealth distribution. "Look, facts !" Numbers without context are meaningless.
What do experts say? We never hear. Only a "Golly, geee whiz, that doesn't sound right !"
Yep, that's why real estate is so bubble prone.
It's a bit of a shame too, because crazy real estate bubbles can really screw over people who just want a place to live, and don't forget what caused the global financial catastrophe back in 2008.
I imagine it was a good investment but there is a lot involved in maintaining these residences - you need a staff to manage the staff! It's not just like you can leave these properties empty, like your neighbors are going to let your landscape go to weeds, or you were to going to leave all the plumbing and air conditioning systems lie completely dormant. It really seemed like a lot of work to keep a big empty house, but if you are that rich you have "people." But I worked with the "people" that managed the rental property and they didn't seem all that well paid. I worked at the yacht club and my pay was lower than any other job I've had in recent years. My boss told me I was the highest paid employee - more than the five star chef even.