patrick.net

Reality says

The median household networth is only $80k. That's only the equivalent of a couple months worth of hospital stay! A a couple decades worth of Medicare and Medicaid is worth far more than $80K! Even food stamps at $400/mo is more than $80k at current discount rate. Section-8 rent subsidy at $1000/mo is $200k in present cash value! The chart is utter nonsense when it doesn't count the value of basic safety-net provided to the poor. Also goes to show why a large segment of the population has lost all incentives to work.

So, should I include the present value of my salary until I retire as my "wealth" then? I think most sane people would disagree with that treatment...

Reality says

Why would anyone want to work for a risky job without compensating pay advantage, unless there is government enforced enslavement such as a military draft?

Because it beats dying penniless on the streets of hunger. And that's where we're headed--labor has no leverage, so corporations can pay as little as they want for a job no matter how hazardous.

Reality says

Sure, everyone suing everyone else is the road to society prosperity. Not!

Good one, Wayne.

If you set the rules of the race, and can start right before the finish line, and if the judges can alter the rules if you were to experience a set-back, you might find that you have more trophies than the poor slobs who had to run an honest race.

Blurtman says

If you set the rules of the race, and can start right before the finish line, and if the judges can alter the rules if you were to experience a set-back, you might find that you have more trophies than the poor slobs who had to run an honest race.

That's been happening since 1980?

tatupu70 says

Blurtman says

If you set the rules of the race, and can start right before the finish line, and if the judges can alter the rules if you were to experience a set-back, you might find that you have more trophies than the poor slobs who had to run an honest race.

That's been happening since 1980?

If we were back in the days of newspapers and periodicals only, do you think folks would know more or less about Wall Street fraud and the lack of prosecutions?

Blurtman says

If we were back in the days of newspapers and periodicals only, do you think folks would know more or less about Wall Street fraud and the lack of prosecutions?

So is that a yes?

tatupu70 says

Blurtman says

If we were back in the days of newspapers and periodicals only, do you think folks would know more or less about Wall Street fraud and the lack of prosecutions?

So is that a yes?

Even George W. Bush jailed financial criminals. And any answer that I give will be subject to information availability bias.

Blurtman says

Even George W. Bush jailed financial criminals. And any answer that I give will be subject to information availability bias.

OK great--is theory then that lack of prosecution of financial crimes is what is causing wealth inequality?

If so, what changed in 1980 that caused the downward trend to change direction?

Blurtman says

Even George W. Bush jailed financial criminals. And any answer that I give will be subject to information availability bias.

Yea, but they were Clinton's financial criminals. The ones he created went scott free.

tatupu70 says

Blurtman says

Even George W. Bush jailed financial criminals. And any answer that I give will be subject to information availability bias.

OK great--is theory then that lack of prosecution of financial crimes is what is causing wealth inequality?

If so, what changed in 1980 that caused the downward trend to change direction?

Taxation for 20 Alex.

The short answer is that Wall Street, for the last thirty years or so, has been skimming prodigiously from the top. The graph above shows how the total economic cost of financial intermediation grew from under 2 percent in 1870 to nearly 6 percent before the stock market collapsed in 1929. It grew slowly throughout the postwar expansion, reaching 5 percent in 1980. Then, beginning during the deregulatory years of the Reagan administration, the money flowing to financial intermediaries skyrocketed, rising to almost 9 percent of GDP in 2010.

http://tcf.org/blog/detail/graph-how-the-financial-sector-consumed-americas-economic-growth

Blurtman says

Taxation for 20 Alex.

I agree that's a good part of it at least. But as much as I think the financial industry is a complete waste of resources hat adds zero value to the economy, I don't see a cause and effect with wealth inequality.

Gini coefficient going down mid 1930s, and starts going up 1970s.

The largest knob on the Gini is manufacturing and R&D.

We the USA used our liberty to build smarts, and saved Europe against communism.

Then the 1960s came along and the Love of Drugs and Rock and Roll roiled the US.

tatupu70 says

Reality says

The median household networth is only $80k. That's only the equivalent of a couple months worth of hospital stay! A a couple decades worth of Medicare and Medicaid is

So, should I include the present value of my salary until I retire as my "wealth" then? I think most sane people would disagree with that treatment...

No. You have to continue working to earn that money. Welfare entitlement however is literally like inheritance and trust fund, both of which would be counted as wealth by most sane people.

tatupu70 says

Reality says

Why would anyone want to work for a risky job without compensating pay advantage, unless there is government enforced enslavement such as a military draft?

Because it beats dying penniless on the streets of hunger. And that's where we're headed--labor has no leverage, so corporations can pay as little as they want for a job no matter how hazardous.

Everyone wants the best deal, including yourself. It is the presence of other employers that give the worker the ability to refuse the lowest bidder. That's why government restriction on competing employers and government becoming the employer can only lead to slavery. Paternalism doesn't work, because people have rising expectations.

Reality says

Welfare entitlement however is literally like inheritance and trust fund, both of which would be counted as wealth by most sane people.

lol--really? Show me a definition of wealth that would include potential future income as wealth.

Welfare isn't guaranteed...

Reality says

That's why government restriction on competing employers and government becoming the employer can only lead to slavery. Paternalistic doesn't work, because people have rising expectations.

Which industries do you think the government is crowding out potential employers?

tatupu70 says

Reality says

Welfare entitlement however is literally like inheritance and trust fund, both of which would be counted as wealth by most sane people.

lol--really? Show me a definition of wealth that would include potential future income as wealth.

Welfare isn't guaranteed...

Wealth is nothing but the potential for generating future income without having to work for it. Under our current social system, welfare payment is far more reliable than dividends from Kodak, the former proverbial widow and orphan stock.

tatupu70 says

Reality says

That's why government restriction on competing employers and government becoming the employer can only lead to slavery. Paternalistic doesn't work, because people have rising expectations.

Which industries do you think the government is crowding out potential employers?

Education, medicine and banking/finance, just to name a few. The very same industries where cost rise is far out pacing returns. Government housing projects were also attempted a few decades ago, but that came to ignoble end quickly as government "projects" manifested themselves as centers of crime and human misery.

Reality says

Wealth is nothing but the potential for generating future income without having to work for it.

No, it's really not. Can someone sell their stake in welfare? Can they leave it to their heirs? It is not considered wealth under any definition that I've ever seen.

Reality says

Education, medicine and banking/finance, just to name a few

Last I checked there were a LOT of private higher education outlets. What is keeping employers from creating their own schools?

Regardless, those industries are pretty large--are you implying that there would be MORE people employed in banking/finance were it not for the government? And that would be a better scenario?

tatupu70 says

Reality says

Wealth is nothing but the potential for generating future income without having to work for it.

No, it's really not. Can someone sell their stake in welfare? Can they leave it to their heirs? It is not considered wealth under any definition that I've ever seen.

Nor can many beneficiaries of family trust funds. Yet that is certainly wealth. The welfare safety net is the equivalent of a family trust fund for being born American. The value of that trust fund should be counted just like the heir of a family fortune that has stipulation that he can not sell the trust assets but only derive monthly stipend payments.

tatupu70 says

Reality says

Education, medicine and banking/finance, just to name a few

Last I checked there were a LOT of private higher education outlets. What is keeping employers from creating their own schools?

Potential consumers of private education having already have to pay for public education via taxes.

Regardless, those industries are pretty large--are you implying that there would be MORE people employed in banking/finance were it not for the government? And that would be a better scenario?

Silly misdirection. The point of any industry is not to employ more people but delivering real value to customers. Any industry with government subsidy to hire more people while delivering little to no value to customers is essentially welfare, and slavery. Yes, the slaves on the plantation also had free housing, free food, free medicine, free education . . . All at the discretion of the slave owner! Paying for something with one's own money gives one the right and option to choose. In the bigger picture, it is this drive to optimize and get better deals that ultimately improve economic efficiency and lift the standards of living for all.

Reality says

Nor can many beneficiaries of family trust funds. Yet that is certainly wealth. The welfare safety net is the equivalent of a family trust fund for being born American. The value of that trust fund should be counted just like the heir of a family fortune that has stipulation that he can not sell the trust assets but only derive monthly stipend payments.

So, you can't find any definitions that would include welfare as wealth then?

Reality says

Potential consumers of private education having already have to pay for public education via taxes.

So what? The cost of education is rising exponentially, right? You're telling me that the much more efficient private industry can't compete??

Reality says

Silly misdirection

Not at all. You said:

Reality says

It is the presence of other employers that give the worker the ability to refuse the lowest bidder.

implying that the reason employees have less leverage is because there are fewer employers (and fewer jobs) because of government crowding.

Don't now change the subject to delivering value.

tatupu70 says

Reality says

Nor can many beneficiaries of family trust funds. Yet that is certainly wealth. The welfare safety net is the equivalent of a family trust fund for being born American. The value of that trust fund should be counted just like the heir of a family fortune that has stipulation that he can not sell the trust assets but only derive monthly stipend payments.

So, you can't find any definitions that would include welfare as wealth then?

If it accrues benefit like wealth and trust fund, then it is wealth and a form of trust fund. Even your god FDR himself called benefits one will receive via Social Security as "your own money"; so SSI and SSDI administered by the same social security apparatus are "your money" and asset/ wealth too. LOL

tatupu70 says

Reality says

Potential consumers of private education having already have to pay for public education via taxes.

So what? The cost of education is rising exponentially, right? You're telling me that the much more efficient private industry can't compete??

Just like even if you were a productive person, if someone mugs you every month right after your payday and take away all your money, you'd still starve. A productive private person is not a miracle, despite what you think :-)

Reality says

Silly misdirection

Not at all. You said:

Reality says

It is the presence of other employers that give the worker the ability to refuse the lowest bidder.

implying that the reason employees have less leverage is because there are fewer employers (and fewer jobs) because of government crowding.

Don't now change the subject to delivering value.

Delivering value is the same as making profit in a competitive market place: others actively judging your service as delivering value therefore willing to pay up after comparison shopping elsewhere. It may be a foreign concept for people having spent too much time I government bureaucracy.

Btw, "less leverage" than what? Some people will always have more leverage than others, just like some girls are prettier than others. Making every girl wear a burqa or cutting off all noses on all female faces would only make lives more miserable for all. There is nothing preventing an employee saving up capital and becoming an employer in a competitive market place. Government red tapes and privileges would only get in the way of that social mobility, and make the society even more unequal.

Reality says

If it accrues benefit like wealth and trust fund, then it is wealth and a form of trust fund. Even your god FDR himself called benefits one will receive via Social Security as "your own money"; so SSI and SSDI administered by the same social security apparatus are "your money" and asset/ wealth too. LOL

Again--let's stick to the subject. Would you consider your future social security benefits to be wealth today? If so, how would you calculate it?

Honestly, I know you can BS much longer than my interest in replying will remain. It is obvious that welfare is not wealth under any commonly used definition.

Reality says

If it accrues benefit like wealth and trust fund, then it is wealth and a form of trust fund. Even your god FDR himself called benefits one will receive via Social Security as "your own money"; so SSI and SSDI administered by the same social security apparatus are "your money" and asset/ wealth too. LOL

This is just about the dumbest posting I've ever seen on patnet.

Reality says

Just like even if you were a productive person, if someone mugs you every month eight after your payday and take away all your money, you'd still starve. A productive private person is not a miracle, despite what you think :-)

But that's not what we're talking about. If you are a productive person and someone takes 2% of your paycheck, you're still a productive person. So, tell me again why no private employers can create higher education facilities that compete with the inefficient government run institutions??

Reality says

Delivering value is the same as making profit in a competitive market place: others actively judging your service as delivering value therefore willing to pay up after comparison shopping elsewhere. It may be a foreign concept for people having spent too much time I government bureaucracy.

If that was at all relevant to the subject at hand, you might have a point.

Reality says

Btw, "less leverage" than what?

Less leverage than what they had 30 years ago. Or 50 years ago.

Reality says

Some people will always have more leverage than others, just like some girls are prettier than others. Making every girl wear a burqa or cutting off all noses on all female faces would only make lives more miserable for all.

Again--how is that relevant to the point at hand? You are incapable of sticking to the topic.

tatupu70 says

Reality says

If it accrues benefit like wealth and trust fund, then it is wealth and a form of trust fund. Even your god FDR himself called benefits one will receive via Social Security as "your own money"; so SSI and SSDI administered by the same social security apparatus are "your money" and asset/ wealth too. LOL

Again--let's stick to the subject. Would you consider your future social security benefits to be wealth today? If so, how would you calculate it?

Of course I would consider that part of my wealth and retirement funding. In fact, the overwhelming majority of Americans rely on SS for retirement funding. How would I calculate it? There are formulas for that based my contribution. Heck, SS is even heritage to spouse. How can you not count those safety net as future income generating assets, i.e. wealth?!

Honestly, I know you can BS much longer than my interest in replying will remain. It is obvious that welfare is not wealth under any commonly used definition.

Obvious only to those bound by obsolete definitions defined before the new reality on the ground. If you keep out all such assets and income streams that significantly affect people's standards of living, then your cries about "wealth inequality" are utterly meaningless.

tatupu70 says

But that's not what we're talking about. If you are a productive person and someone takes 2% of your paycheck, you're still a productive person. So, tell me again why no private employers can create higher education facilities that compete with the inefficient government run institutions??

2%? Are you a high school student not in charge of your own finances or someone living outside of the US? The typical property tax bill for the upper middle class family in the US is $5000 to $15,000 a year! After paying that property tax (more than half of which is allegedly spent on the local public school in most towns), the family would be hard pressed to pay for private schooling of their children.

tatupu70 says

Reality says

Btw, "less leverage" than what?

Less leverage than what they had 30 years ago. Or 50 years ago.

For that, you have the fiat money system to thank for (43 year and counting). When businesses' success vs. failure is more dependent on manana from the central bank printing press, employees and sound business practice become less important.

Yeah wealth inequality is huge. Let us not worry about how to create good jobs and maintaining our competitiveness. Lets take money from the successful folks and give it to these folks below-so they can be maintained in the lifestyle they were used to. It makes me wonder if feminism is what ruined America by bringing the entitlement mentality to America??

Reality says

Of course I would consider that part of my wealth and retirement funding. In fact, the overwhelming majority of Americans rely on SS for retirement funding. How would I calculate it? There are formulas for that based my contribution. Heck, SS is even heritage to spouse. How can you not count those safety net as future income generating assets, i.e. wealth?!

Because it doesn't fit the actual definition.Reality says

Obvious only to those bound by obsolete definitions defined before the new reality on the ground. If you keep out all such assets and income streams that significantly affect people's standards of living, then your cries about "wealth inequality" are utterly meaningless.

Ah, I see. So, you've created your own definition to suit your needs. I'm pretty content that the actual definition of wealth is appropriate. If you want to include welfare as INCOME and include it in any discussions of INCOME inequality, then you'd be correct.

tatupu70 says

Because it doesn't fit the actual definition.

Just like some people concluded that the GDP of East Germany was bigger than that of West Germany because by definition all government waste is counted as GDP.

You either discard the meaningless definition of "wealth" that keeps out all the crucial factors affecting people's real standards of living, or render your entire thesis irrelevant.

tatupu70 says

Ah, I see. So, you've created your own definition to suit your needs. I'm pretty content that the actual definition of wealth is appropriate. If you want to include welfare as INCOME and include it in any discussions of INCOME inequality, then you'd be correct.

Welfare is income and is taxed as such in many cases. Is your thesis really about standards of living difference or some meaningless numbers that exclude the real factors? By the kind of narrow definition of "income" that you are fond of, Leona Helmsly would have been considered poor because she had little income, but lived off borrowed money from her businsses/assets.

Reality says

2%? Are you a high school student not in charge of your own finances or someone living outside of the US? The typical property tax bill for the upper middle class family in the US is $5000 to $15,000 a year! After paying that property tax (more than half of which is allegedly spent on the local public school in most towns), the family would be hard pressed to pay for private schooling of their children.

And how much does an upper middle class family in the US earn? $100k? $150K? Assume $7500, half of which is education, gives me somewhere between 2.5% and 3.75%. I'd say that's a lot closer to 2% than 100%. Wouldn't you agree?

Reality says

For that, you have the fiat money system to thank for (43 year and counting). When businesses' success vs. failure is more dependent on manana from the central bank printing press, employees and sound business practice become less important.

Nope--it has very little to do with fiat money.

Reality says

Welfare is income and is taxed as such in many cases

And that's why I said to include it as income and not wealth.

Reality says

You either discard the meaningless definition of "wealth" that keeps out all the crucial factors affecting people's real standards of living, or render your entire thesis irrelevant.

In this case, the definition isn't meaningless so we can keep it. What's meaningless is your attempt to describe potential future income as wealth.

tatupu70 says

And how much does an upper middle class family in the US earn? $100k? $150K? Assume $7500, half of which is education, gives me somewhere between 2.5% and 3.75%. I'd say that's a lot closer to 2% than 100%. Wouldn't you agree?

Nope. The $100k family faces marginal tax rate on income close to 50%: 15% payroll tax, 25% federal income tax, state income tax 5-8%. That's before the aforementioned property tax, which works out to be 5-10% of income if the rate is 1-2% on a house worth 5x annual income. So the overall tax rate before sales tax is already 50-60%! The $5000-15,000 a year represent a very large proportion of the family's disposable income (nearly all of it in some cases), not the 2% number you were bandying about. I'm starting to think you are a high school kid or someone who is so wealthy that you have no idea how the middle class and upper middle class household is run nowadays.

tatupu70 says

For that, you have the fiat money system to thank for (43 year and counting). When businesses' success vs. failure is more dependent on manana from the central bank printing press, employees and sound business practice become less important.

Nope--it has very little to do with fiat money.

You claimed the prroblem has been running for 30-50 years. I pointed out to the obvious culprit. Of course, you are paid to ignore that one. LOL.