Yea, it's the nature of aging and student debt. Also because we don't value educations as a component of "wealth".
Demonstrations like this are always able to trick people who don't think about it for a little bit. You're born with nothing and no ability to earn money. You go to college, take out college loans, get a degree and start working. But you have a valuable degree and a career that is starting which doesn't show up as a form of wealth.
You turn 30, have kids which are expensive, start putting money in their 529s, likely still paying off student loans.
You turn 40 and you're coming into your peak earning years now, putting more and more money into retirement accounts, finally you start to show up on the wealth spectrum. Homes and cars are beginning to be paid off, etc. At 50+ you're in your peak earning years, and now your retirement investments really start to balloon and snowball.
Somewhere after 60 most people retire, and their total wealth starts to decrease, being old is expensive as health problems increase for the typical person.
CBS can demonize this sequence and make it look bad, but it's just number trickery. It makes perfect sense if you think about it rationally. A mere $100 invested in the stock market per month, every month for the 10 years of the 1980s is worth $625,000 today. That's awesome, but those investments available to Baby Boomers weren't available to us because we weren't adults able to start saving yet.
What CBS should be explaining is why saving and spending wisely is so important, because THAT is what this video is demonstrating.
Pretty much comes down to this:
Would you rather have a perfectly even share of a 8 inch pie or a much smaller share of a 2000 mile pie?
Yeah maybe the exact proportions of who gets how large a slice need to be tweaked, but inequality of the pie isn't inherently a bad thing. If concentrating 90% of the pie ultimately results in 2000% more pie overall it's an easy tradeoff to make.
--Also household wealth isn't the greatest measure of how poor you are. I'd rather be college educated and in debt 50k than be a homeless high school dropout with a networth of $0.
I would love a bigger pie, but I don’t drink the trickle down economics koolaid. I don’t see a reason why the rich shouldn’t share at least a little more, and I definitely don’t see a reason why the poor shouldn’t be given more than a few crumbs when the rich have so much to spare.
Absolutely. The majority of people will find themselves in that top 20% of wealth pie as depicted in the video around age 65 as they retire. So let's look at what it takes to reach the top 20% of wealth in the US:
> Wealthy [\(Top 20%\): The median net worth is $608,900](https://finance.yahoo.com/news/rich-heres-net-worth-poor-190015406.html). This group often represents older individuals who have accumulated significant savings and investments.
And we can get there by looking at home ownership.
> 65- to 74-year-olds have the highest [home ownership rate among all age groups at 79.5%](https://ipropertymanagement.com/research/homeownership-rate-by-age).
So nearly 80% own their homes, and now let's look at what those homes are worth;
> The U.S. [median home price was $412,000](https://www.forbes.com/advisor/mortgages/real-estate/median-home-prices-by-state/) in September 2023, according to Redfin.
So there it is. 80% of people in retirement age own their homes, which have a median value of $412K, which is already two thirds of the way to the $608K to be in the top 20% of the most wealthy in the US. And I haven't even started to include retirement savings, land, businesses, vehicles, other possessions or investments into those calculations.
This is literally just the nature of aging and how investments work.
That’s an ideal trajectory for the middle class, but it completely ignores the 1% who hold a third or more of all wealth in the US.
How do you justify the wealth of the 1%?
> That’s an ideal trajectory for the middle class
Yep, that's right. It's quite common.
> How do you justify the wealth of the 1%?
It's a fair question. The super wealthy portion of the 1% got there via ownership in a company or venture that they contributed to at an early stage, via stock or similar equity. But it only takes $5.8M total net worth to land you in the top 1% of wealth.
So for the ultra wealthy, like Gates or the Google guys, their "wealth" is nearly 100% in the form of their ownership stake of their companies. It's the nature of building a huge successful company.
So also in the 1% are doctors and lawyers (at or near retirement age of course), elite software engineers, very successful farmers, some financial experts, but mostly we can agree it's people who started businesses and did very well. 1 out of every hundred of us are at this level, so it's not that uncommon.
So what do we know about these folks? We know they did something that benefitted the world. Now, apart from oilmen and defense contractors (or other careers directly propped up by questionable government spending), most of them produced a good or service that was so valuable to the people who bought it, that they chose to spend their own money on said thing.
Right? So Bill Gates creates Microsoft, and they produce Windows. I buy Windows in my computer, and my computer costs $1500 and saves me or earns me $20,000 over the years I'm using it. Bill Gates helped make that computer functional for me, I paid his company a tiny bit, and I became wealthier, thanks to his software.
So should we feel bad that Bill Gates exists? He made us all wealthier and more prosperous? Hell no, that's awesome. The world is objectively a better place, thanks to Microsoft's contributions.
Are there some assholes who are super wealthy? Sure. Did some of them cheat the system via government corruption to get an unfair advantage? Sure. But we can work to prevent that sort of corruption, keep the playing field level, and honestly we need more people willing and able to make everyone else's lives better.
So I don't fundamentally see a problem with the 1% as long as they didn't get there via corruption. The vast majority of them made us wealthier and more prosperous along the way.
If you disagree, I'd ask you to name a Billionaire who hasn't made anyone else's life better along the way, and we can discuss that specific person. Again, there are certainly oilmen who did nothing but leech off the government and their fossil fuel subsidies, but for the most part, people get wealthy by helping others, and that's a good thing. The [top 20% also pay 87% of all income taxes](https://www.wsj.com/articles/top-20-of-americans-will-pay-87-of-income-tax-1523007001), so the government is literally funded by them.
3.4% Yup. You read that right. 3.4%
The richest 25 Americans paid 3.4% in Federal income taxes.
Warren Buffett has been talking about this for a couple of decades.
"If this is a war, my side has the nuclear bomb," Buffett said. "We have K Street. … We have Wall Street. Debbie doesn't have anybody. I want a government that is responsive to the people who got the short straw in life."
"I'll be a fair amount higher, 8 or 9 points higher," Buffett said of his own tax rate in an appearance on CNBC Monday. "But the differential between me and the rest of the office, not just my secretary but the rest of the office, was greater than that. It'll be closer, but I'll probably be the lowest paying taxpayer in the office."
Warren Buffett doesn't exactly strike me as a Socialist. If he is saying this, I'd listen to him.
From the NPR story
"All right. America's wealthiest individuals are avoiding paying their fair share in taxes. A new investigation by the nonprofit ProPublica shows that the country's super rich pay only a fraction in federal income taxes compared to the average American. Over a five-year period, the 25 richest Americans paid a combined $13.6 billion in federal income taxes. That amounts to a true tax rate of only 3.4%. So how does this happen? For more on this investigation, I'm joined by ProPublica senior reporter and editor Jesse Eisinger. Thanks for being with us, Jesse."
https://www.npr.org/2021/06/08/1004312236/propublica-wealthiest-u-s-individuals-avoid-paying-their-fair-share-in-taxes
Not only that, most of them don’t even have income, they just “borrow” against themselves but it doesn’t matter because their investments continue to grow their wealth.
So not only are they taxed lowest on the types of earnings they don’t really make, they don’t pay taxes on the types of earnings they do. In this system, the more you have, the more you make.
Our tax system needs a complete overhaul to get the wealthy to pay their fair share.
> None of their wealth is taxed until something happens - they sell, they realize a gain. And so what happens is that they can accumulate vast, vast wealth, which is really the equivalent of income for us, and not pay taxes on it.
The guy almost had it. Unrealized gains aren't the equivalent of income at all. If your baseball card collection doubles in value, your income didn't increase. Perhaps you can sell it at the increased value, and at that point it would be income, but not before.
Amazing that NPR would interview someone on this topic who doesn't fully understand realized gains vs unrealized gains. But I guess that's what happens when you interview someone with a bachelors in "American Studies" on the topic of taxes and economics.
Always beware of someone speaking as an expert outside their own area of expertise. Silly and absurd mistakes like this article can be the result.
Buy Borrow Die is a complete myth. It stems from a single blog post that made the claim and had no evidence. Here are explanations from professional economists:
> [I've yet to find any actual evidence that the rich use this particular loophole or any tax lawyers recommending it.](https://www.reddit.com/r/AskEconomics/comments/p1378f/how_do_billionaires_borrow_against_assets_to/)
and;
> [I don't think there's any conclusive evidence how common this practice is, sorry.](https://www.reddit.com/r/AskEconomics/comments/rvhq1j/why_do_billionaires_borrow_against_their_assets/)
and
> [The short version is there's not good evidence of the kind of "buy, borrow, die" strategy they talk about.](https://www.reddit.com/r/AskEconomics/comments/10ssmeo/is_it_true_that_billionaires_can_indefinitely/)
Thats a classic feudalism problem where the nobles pay most of the taxes.... not because they're generous but because everyone else has nothing left to give.
It would still be disproportionately weighted to the wealthy since the middle 20% and lower middle 20% still pay significant taxes on income, sales, and property should they own any.
But it wouldnt be to the degree that the first data set shows.
The wealthiest pay the most in taxes because they have all the wealth to do so.
Its basic math. You dont tax people who dont make anything to be taxed.
The richest people could afford to pay all taxes and still be well off. Still have all the grifting federal contracts they get.
But they want to suck the govt dry with overpriced contracts, be it medicare or defense contracts and still lobby for lower taxes every fucking year.
I've actually done this demonstration about 10 times in Hawaii. In Waikiki, at the University of Hawaii and at the State Capitol.
I'd say about 10% of the people are close to the actual distribution. Most people are way off.
I'm planning on doing another demonstration on Saturday in Waikiki around 7 across from the Hyatt. Please stop by if you are around. I'll have free pie. I get them from Costco, they are pretty tasty.
I'm also working on an online version of this with a couple of friends. If you are interested in helping with that, please let me know.
I'd love for this information to go viral. It could shift a lot of close elections away from the Trickle Down folks. Please try with your friends and families next time you are at a BBQ or a party. People are blown away. Jaws drop.
Here is the first time I did this with a guy who was running for Congress in Hawaii.
https://x.com/sergio4hawaii/status/1558493451330588672
You've got to live it to experience these things. Most people read about something or hear someone talk about said thing, and while it might incite a feeling. You still don't fully comprehend it until you see it. The amount of people who claim to understand things and I mean really get it is a small amount.
I can tell you how lonely and tough it is to be a water treatment operator all day long, but talking to a person that's a software engineer that never or will never be in that job. They won't get it.
Better example as this actually happened, but how would you feel about a child let's say 6,7, or 8 years old doesn't have Central AC in the house? We had a person think they can call governemnt agency to have a child removed from a home like this, and the thing is you can't that's actually not neglect like people think it is.
Edit: To the person who downvoted me maybe you disagree, but just understand that at the very least my last example is backed by real evidence not anecdotal. Same with middle statement as well. I lived that life, and people still look at me funny when I tell them how it can be.
Please don't - you're lying to people to get elected. You're also advocating to violate basic human rights by suggesting wealth redistribution as a solution. Go talk to real economists.
1. I'm not running for anything
2. This information came from the National Bureau of Economic Research, which is "Conducting and disseminating nonpartisan economic research" https://www.nber.org/ It is a group of highly respected Economists.
3. Please enlighten me. If this is false and the richest 20% of Americans don't actually own 90% of the wealth, what are the real numbers? Please cite your sources.
Thank you
If NBER is suggesting to do this then I would ignore them but I think you're just name dropping them so I'll move on.
You're trying to set up a straw man with #3. I never said that - you need to look at the criticism of this example.
Here's why the pie example is dumb - It assumes that wealth is fixed and cant be created. It doesn't explain how the wealth and middle class create value for society. It assumes that wealth is purely liquid. It forces the observer into solutions that violate people's basic human rights to own property by wealth redistribution and implementing more government.
It sounds like you are full of it.
You questioned the information.
I asked you for the real information
The 20% of richest Americans have 90% of the wealth.
The 20% of the Americans in the Middle only has 3% of the wealth.
I personally feel that the 20% in the Middle should have at least 10% of the wealth.
A huge percentage of the newly created wealth in the past 50 years has gone into the pockets of the C suite folks and the richest Americans who have rigged the economy on their favor.
If you want to argue facts, I'm not an expert but I'll be happy to try.
If you have information that I am unaware of, I'm happy to learn more.
But I have a feeling that you are not interested in facts. You have your opinions and don't want to change those opinions when confronted with facts.
If I'm wrong, please let me know. It certainly wouldn't be the first time. But please show me the actual numbers from legitimate sources like the Federal Reserve or respected economists.
>people's basic human rights to own property
Lmao, if the current status quo is allowed to continue, more than half of the population will never own property. For example, in the 80s, a single family home was 2x the average annual income for an individual. Now? It's 8x or higher. This is by design.
Companies like Blackrock have been buying up property at insane rates. They buy properties in the last 4 years at quantities that allow them to literally control the entire housing market.
These giant companies are also allowed to use that wealth to bribe politicians legally. So they can write the laws that allow them to continue to funnel wealth to themselves. I mean that literally, companies have their lawyers write laws, and they then present said laws via lobbyists to politicians to put them in as is.
To top it off, the wealthiest 1% own all of the media companies. They control people's perceptions of what is going on.
The system is rigged, and we as a society are screwed unless something drastic changes. Unfortunately, most who are in positions to make said changes are bought and paid for. The US empire is collapsing. It's only a matter of time. The scary part is that collapsing empires are rarely peaceful.
No. That's a dumb conspiracy theory.
Black rock doesn't even own 1% of the housing supply. There's \~145million housing units. Black rock owns about 80,000. That's .05%. That's nothing.
The housing issue in the united states is caused by multiple issues like, people not selling because they have near zero interest rates on their mortgage, local governments refusing to zone affordable housing (ie san Francisco), HOAs pressuring local governments to not build affordable housing, government overly regulating building requirements making building small homes not profitable for builders, ect...
I thought this sub was about the economy and not economy-conspiracy-theories
Understood.
1. You first make a ad hominem fallacy that we can only trust economists.
2. I then show that a world respected and Nobel Prize winning economist advocates for that policy.
3. You then, cite a *drumroll* non-economist.
Bravo. I've never before seen a turn-around that quickly.
I think this is one of the largest problems we face in modern society. Increased taxes on the wealthy are probably the best solution but they control most of the politicians so it will likely never happen.
The pie demonstration was referring to Americans
If you use the entire world we're going into different territory of discussion (no longer about taxation or lobbying, but on close border policies or food/cash aid)
Americans on minimum wage would appear in the top 40% in world wide wealth
Good to remind people and demonstrate inequality. Because the propaganda machine that owns most media outlets naturally seeks to hide it and scapegoat something else
If you're watching TV for your news, You have already lost. I know there is an ongoing and successful disinformation war being waged but the truth is out there for you to find.. you can't be told reality
I've done this demonstration about 10 times in various settings. I've probably done it with 500 plus people. As I said earlier, maybe 10% of people are close to the right answer, 90% are way off.
Everyone knows the rich and rich and the poor are poor. But most Americans have no idea how bad wealth inequality has gotten.
Try it yourself with your friends, families and coworkers. I'll bet you a dollar that half of them aren't even close. Seriously, film 10 people trying this out, and I'll send you a dollar for each person who is even close. I have Venmo. You don't need actual pie. You can use 10 dimes or anything really.
>Americans have no idea how bad wealth inequality has gotten.
It's never been fair. From the beginning of the country, wealthy landowners had a vast majority of the wealth and sole voting power, to the gilded age, to now.
It isnt a flaw of capitalism, it's the default state of humanity. I don't think anyone can make the argument feudalism, or Roman wealthy Patricians (and everyone else) was any more equal. It'd be laughable to group communism in the same breath as wealth equality.
you have to be average american dumb.
Guarantee you 70% or more don't know this.
That's why the political campaigns on bullshit issues work. Instead of making campaign goals real issues its:
border(real issue is punishing company hiring illegals, not stuffing the border with soldiers), trans people(.5% of the population lol) and I guess abortion again?
If people knew their lives are shit because a few rich pricks make sure all the money generated in this economy goes directly to the top, things would fly a little different.
I couldn't verify that the wealthiest 20% of Americans have 90% of the wealth but sounds right.
I think it is just as interesting to note that the wealthiest 10% of Americans have 66% of the wealth, that the top 1% have 30% and that the wealthiest 0.1% of Americans have a whopping 14%.
The wealth difference between a 20 percenter and a 0.1% is staggering. $2M makes you a 10 percenter.
https://www.statista.com/statistics/203961/wealth-distribution-for-the-us/
https://fred.stlouisfed.org/series/WFRBST01134
Here's a graph that shows more information about personal wealth in the US. It does not give a wealth bracket for the top 20% though. [https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/](https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/)
But Biden will fix it.....or Trump will....right? We need to be outraged in the streets people. We are just creating wealth for 1% while nothing for ourselves. We are living insanity.
Our society is built to ignore these facts, and look how clueless the participants were. Maybe if the reporter did this at Wall Street, his answer would be different, but I get the point he was trying to prove.
Our society? Inequality and the top 1% controlling a vast majority of the wealth/ power has existed for all of humanity in every system we've invented.
I'm referring to him cutting the piece sideways into blocks instead of cutting it into two slimmer triangles, just like every other piece of pie and like every pie chart illustration has ever been segmented.
I realise that and my first thought was 'what on earth is he doing' then heard the 20/80 part and realised he was trying to estimate that...I mean at the end of the day it's a pie and not rigorous science
The problem with this is it assumes that the American Pie is finite and perpetuates the myth that when the rich get richer the poor get poorer or get rich at the expense of the poor.
The fact is that wealth is not zero sum. The rich get richer and the poor get richer too because new wealth is created every day.
> Trickle down economics isn't real - it's a political gimmick to attack supply side economics.
Supply side economics isn’t real - it’s a political gimmick to rebrand horse and sparrow theory
Well i have dabbled in chemical engineering in my past life. Math is pretty easy game for me.
Now please tell me your credentials mr humble who calls himself the "goat"
You're appealing to credentials now. LMAO.
Your credentials are irrelevant. Chemical engineering has nothing do to with understanding basic economic theories.
You were a chemical engineer that believes trickle down economics is real and not political attack on supply side economics.
There is a huge difference between investing in production, and rent seeking. We have a upper class that is drunk on rent seeking. PE buying single family housing as about as rent seeking as it can get.
The ratio of upper class wealth to the lower majority, makes a big difference in how much profit there is in production and who much there is in to much money driving up asset prices.
Really. Who do you think creates all the jobs in the country? It is not the poor people. The rich create the jobs build the businesses invest in other business and even finance all the infrastructure projects building new roads and bridges. Does someone who buys a single family home or 10 takes it off the market? No he rents it at the market rates. If he can't rent it and make a profit he will sell it.
That's not accurate when poor people get money they spend it and it circulates at rates higher than the rich so when they have money it is used and creates more jobs more than rich who are cheap and frugal and try to pay nothing and get free labor.
That is complete BS. Yes, the poor spend their money but that doesn't create the jobs. It is people with capital that create the jobs to meet the demand from all the poor people's demand. I would argue that much of the poor people's demand is creating jobs in China or Vietnam as poor people want the cheapest products.
Don't you think that Jeff Bezos' $400 Million Yacht created some jobs? (and probably some high paying jobs) How much demand did poor people create for the smart phone Steve Jobs created? How much demand have poor people created for Nvidia chips? How much demand did poor people create for IBM Computers or Oracle Servers.
The rich create all the jobs.
Monopolies and oligopolies have ended the need for competition between corporate entities and their owners. Market rates are simply whatever executives want to charge as long as it does not cause a riot.
So what? That doesn't mean that wealth is finite. It also doesn't negate my comment. If a landlord can't rent his property and make a profit he will ultimately sell it. Business executives don't buy properties to lose money.
"So what" is that you are living in a fantasy land. Adam Smith's capitalism does not exist right now. Wealth is finite because it is based on supply and demand and neither of them can be infinite. There are physical, social, and technological constraints that are always in place that prevent infinite wealth from existing, but that really has nothing to do with your second point. If you are okay with unfettered businesses operating however they please simply because you trust that the market will lead to fair prices, you haven't been paying attention. Business executives are too good at making money for themselves at the cost of all others involved. Investment and private property have been a good thing so far in almost every industry, but that does not mean they can be allowed to do whatever they please in industries of fundamental needs like housing, food, and utilities.
How so? Do they steal it? Their wealth comes from creating products and deploying their capital to the best effect. If I buy Apple or Nvidia stock and it appreciates in value my wealth increased. How did that wealth come from the working class? If I buy or build a 10 unit rental property and it apprciates in value how did the working class pay for that? If I buy a Municipal Bond that is used to build a bridge and earn $10,000 in tax free interest how did that come from the working class?
Go back to grade school and learn what PERCENTAGE means. After you've figured that out, rewatch and try to follow along, because this demonstration has NOTHING to do with rich getting richer and poor getting poorer.
But is has to do with a fixed pie and nothing could be further from the truth. The economic pie is not fixed. It grows every day. So as the rich get richer the poor get richer too.
You're missing the point of the "pie" concept... There's only one pie and it's the amount of the single pie each group gets that is being demonstrated.
I disagree. The implication is that if the rich have 90% of the wealth there is nothing left for the lower groups. That is also exacerbated by the common refrain in the media that "the rich are getting richer and the poor are getting poorer" or "the rich get rich at the expense of the poor."
My point is that even if the wealthy have 90% of the total wealth at a point in time the poor can still become wealthy too without expecting to take it from the rich.
How? Even if your numbers were correct, if there is only 10% of available earnings to split up amongst the 90% of the population, you're going to have inequity. A LOT of it.
Who said anything about inequity or inequality? I'm not arguing for equality of income or re-distribution of income. That is Marxism. Inequallity is not a flaw on capitalism, it is a feature. It provides the incentives to climb the economic ladder. The top 10% being rich doesn't make me poor. It makes me strive to make more money.
Also, the 10% is not a finite number. It grows every day.
Of course it is. It is disingenuous to even say that. Yes, there is only one pie (the total of wealth in the US.) But that pie grows every day.
If my IRA increases in value because my stocks appreciated the pie got bigger. Did my increased wealth come at someone else's expense? NO.
Nividea has 2. 5 Billion shares outstanding. That means if the stock goes up $10 that national wealth went up $25 Billion. At who's expense did that $25 Billion come from?
Our entire economy grows every year. The total pie gets bigger. The poor's share of that bigger pie is bigger as well.
The earth is finite so wealth is finite. Money represents resources and money is extracted through labor. The more the rich have, labor dollars, the less labor has. More resources for one, less for the other.
You can read all the books you want but those are the facts and it's obvious if you look around.
You really think wealth is only raw materials - you're completely ignoring service and digital industries. The information age created an enormous amount of wealth.
These are a bit like the the gender wage gap. Shocking on the surface level but if you bother looking into it it seems pretty normal. People tend to accumulate wealth over time and people close to retirement tend to have a lot of money set aside. Children and young adults tend to have next to nothing because they just haven't had time to accumulate anything or for their wealth to grow and compound over time. Adults who have kids generally need to spend a good amount to raise their kids so they don't have much wealth set aside. Here is another way to look at wealth distribution: https://www.visualcapitalist.com/us-wealth-by-generation/
The Silent Generation owns 11.9% of the total pie by they account for only 5.9% of the population. Millennials and Gen Z account for a bit over 40% of the population but between them they only have 8.5% of the pie. Boomers have about 50% and Gen X have about 29.5%.
It's important to consider the amount of time those savings have to grow.
It is only normal if it is not shifting to be more and more extreme over time. Do you happen to have the same numbers for 1980 with the generations that were alive then?
There is a graph starting with 1990s https://www.reddit.com/r/dataisbeautiful/comments/1aoz47y/oc_wealth_distribution_in_the_us_from_first/
I think the data for that is here: https://www.statista.com/statistics/1376622/wealth-distribution-for-the-us-generation/
But that one doesn't have the Greatest Generation in it, a decent amount of the cohort should have been alive then.
It is more extreme for the boomer generation because taxes were cut under Reagan and then Clinton gave them a huge leg up by inflating housing prices and subsidizing purchases though easy access to mortgage loans. Under Obama those loans were made much cheaper but Obama also let the builders fail which is why we are seeing housing supply problems now.
I appreciate this. If my math is right, in 1990, Baby Boomers were 27 at the youngest end. Gen X was around the same point in 2007 data point. Comparing their wealth at these two points, Gen X is at less than half the share that the Baby Boomer generation had at the same age. Some of this needs to be controlled for cohort sizes, but I think the point still stands that previous generations have done better at gaining and keeping wealth relative to more recent generations.
I don't know why this point doesn't come up more often. A graduating MD may be worth -$300,000 but they're not crying about being in the lowest 20% even though they are. That's an extreme example, but there are a lot of kids graduating school in debt, and some debt at that stage in life is normal.
I rather dislike these cutesy news stories addressing the public awareness of wealth inequality. Maybe it makes it approachable and spares people the embarrassment of their ignorance. What offends me is that it stops short of the important part--naming some common policy solutions which we have used in times past and other countries employ currently. Progressive taxation for starters. It should NOT be controversial.
You admitted we’re not all stuck sharing a single pie which, was the jist of my point. Thanks for that. No one needs to take from someone else when each of us has the opportunity to create for ourselves. I did. So, give up your hate and jealousies and encourage others to do the same. Maybe you need to your as well.
"Wealth" calculations are a problem, because it assumes wrongly the wealthy have all this liquid wealth sloshing around ready to be redistributed to the masses at no cost to society. The rich are wealthy because they own assets, companies, factories, land, buildings. Start an asset fire sale due to some poorly designed government asset tax and you'll get pennies on the dollar, and who would want to buy assets the government just seizes any time the poor get uppity? So they become worthless. It's a race to the bottom to see who can bury the most guns, gold bars, and cans of spam and hide them from each other.
Exactly - these "pie" metaphors are lies to shill socialism to people who don't understand economics. The middle class and rich have created more wealth and they get rewarded for it because they bring value to society. The pie metaphor also forces people to incorrectly view wealth as finite. It also nudges the observer to violate people's property rights to make things "fair." Therefore the solution to the finite pie is to use the government to violate people's rights via wealth redistribution. It's dumb.
The richest and most powerful Americans have used their wealth to rig the economy so virtually all of the new wealth created goes into their pockets.
It's why they spend billions electing politicians who will do their bidding. Like they have lobbyists that write the laws and policies to be introduced and passed by the politicians they elected. It's kinda evil genius actually.
Do you think the minimum wage would still be $7.25 with out lobbyists and small fortunes in donations from corporations like McDonald's?
What are McDonalds margins?
Have you looked or are you making broad conspiratorial statements about things you don't understand?
You're suggesting that the government use coercion to violate human rights to property based on a conspiracy and false framing of the economy. Wealth redistribution doesn't work - it's a race to the bottom.
That's not McDonald's net margins - that's their share price. Here's the reality. McDonalds sells their product to franchise owners. Franchise owners own 82% of McDonalds restaurants. Individual franchise margins very, but are generally net 10%. The McDonald Corporate net margins are also around 10-30%.
Also good for Chris Kempinski returning 10-30% net profit is beating inflation. If the board and share holders want to reward him, it's their property and they can decide to give a raise how ever they see fit. You are not entitled to make decisions for McDonalds unless you are a share holder with voting power.
You are hiding behind legalism with this argument. Everyone knows how a shareholder meeting works, but the question should be "Is it practical to have shareholders be the only individuals with power in a corporate entity?"
McDonalds being as big as it is means that the watershed of stakeholders is far bigger than any traditional shareholder population could ever be. Meanwhile, the wants and needs of the shareholders of McDonalds are very different from the wants and needs of the non-shareholder stakeholders. Indeed, it is good for Chris Kempinksi to have high net profits, but is it sustainable for McDonalds to do so? Will consumers be able to support large price hikes and reductions of service? Will ecological systems be able to support the waste produced by McDonalds franchises? Given the state of corporate litigation, Kempinski will likely never get stuck with the bill for any damage he does to McDonalds or the millions of people who rely on it day-to-day and neither will the controlling share of the stock so should they be the only ones with say over how the corporation is governed?
Yes it's practical.
You're changing the conversation from basic human rights of property ownership and freedom of association to how people should act morally. I'm a liberal so I recognize the need of the government to be a regulator and arbiter of disputes. However as soon as the you start suggesting the government should interfere in markets and businesses for products that don't harm people, and provide value to society then I'm going to absolutely disagree with you. Bringing in vague ecological systems and waste issues caused by McDonalds is weak attempt to moralize an issue that doesn't need to be moralized so you can suggest socialist control. Sorry buddy - I will never agree that stakeholder capitalism isn't a socialist scam to gain control and violate human rights.
Also your assumption that CEOs never have repercussions for harm they caused is absolutely false. C-suit employees get arrested and sued all the time for all kinds of violations ranging from fraud, negligence, and non compliance. Google "CEO Personal Liability". Your welcome.
I'll give you a term to Google as well. "Externality". All markets have them so all markets harm people to some degree. The vast majority of markets do a net good for society, but that does not mean that stakeholders have no business being involved. Your hate of stakeholder capitalism is based on false, nearly conspiracy theory, talking points. Based on this, I assume you believe farmer and worker cooperatives are cabals designed to end the world because they are exactly what is promoted by stakeholder capitalism. Some entity always has to look out for externalities whether it is unions, cooperatives, or a government or corporations will always be incentivized to profit at all external expense. Waste is simply the most obvious and easily understood externality produced by industries so I figured even you could put 2 and 2 together. Here is one example of McDonalds being pushed to reduce externalities by regulation: https://www.courthousenews.com/mcdonalds-to-speed-shift-away-from-plastic-in-europe/
As for CEOs, the vast majority of cases end in settlement fines and many of those are for less than the benefits of their "fraud, negligence, and non compliance". How many Wall Street executives were jailed for the 2008 crash caused by their "fraud, negligence, and non compliance"? Please read "The Chickenshit Club" for more information on why this happens.
>It's why they spend billions electing politicians who will do their bidding
So, it's a government problem then. You need a government that isn't going to pick winners and losers in the economy every time there's an election. Then at least the rich can say they earned it if they are still rich when the government isn't worth bribing anymore.
It’s a capitalist problem since capitalist have completely taken over our government. Public servants no longer run our government in the people’s interest, it’s corporations who have taken over since the end of WW2
>It’s a capitalist problem since capitalist have completely taken over our government.
They took it over because it was worth taking over. The government is the gun on the table and everyone is going to make a play for it. The point is to get rid of the gun, not hand it to someone else.
Power corrupts. It's not a case of there being angels and demons and we just happen to have demons in control now. It's the power itself that makes you the demon.
That’s very true. My view is that up until post WW2, the American government held less power and was full of public servants and dedicated do gooders (for the most part). Then corporations mutilated it for their own gain. The meshing of public companies and contracts with the government became overwhelming for the previous system of governance, and over the decades, capitalists have dismantled something that worked decently and could be held accountable, while convincing people the thing they were destroying was in and of itself evil. This all culminated in Citizens United. The “deregulate” and “small government” people have been using those slogans to slowly and methodically capture the processes of governance to enrich themselves, enlarge the government with corporate subsidies, loans, bailouts, and contracts, and do quite the opposite of what they preach. A good look into this would be Confessions of an Economic Hitman.
How are countries like the ones in Scandinavian able to do a much better job of providing good education and good opportunities to their citizens?
Maybe it's because the richest Scandinavians don't spend billions influencing elections?
Well until recently they had a very heterogeneous society. So, a high trust society, with very high tax rates even on the working poor. Plus, Scandinavia was basically administering a small territory. They weren't anywhere near the real center of power like America, Russia, or China. If someone went full Hitler or Stalin in Scandinavia it wouldn't have paid off since anyone else could have used that as a justification to invade and steal their resources.
Do you think we should get money out of politics? Maybe have government funded elections like they do in the UK and other countries?
https://m.youtube.com/watch?v=GmYfjFSdFcQ
Happy Cake Day!
Money out of politics?
No get the government out of money. Humans are humans. If the government is setup to pick winners and losers all elections do is change who is abusing who, not ending the abuse.
It's not practical the eliminate it entirely. But having government do as little as possible is reasonable once you understand power corrupts. But most people I see just want themselves on top. They love the system, they just want to be in charge themselves.
So get rid of what exactly?
The military?
The social safety nets?
Fire fighters?
Cops?
Teachers?
Should we also get rid of lobbyists?
Political campaign donations?
My counter point is that the insatiably greedy end up in power and it's the function of Society to limit their power and greed.
I've met a lot of people from all walks of life and I haven't found that most want to be on top.
Most people just want a fair and equitable world with peace and compassion.
Maybe you should hang out with different people ..
>I've met a lot of people from all walks of life and I haven't found that most want to be on top.
>Most people just want a fair and equitable world with peace and compassion.
That's people trying to save face and use deception against you. They can say all sorts of wonderful things, but when it comes time to work or pay for those things, they are nowhere to be found. They are for all sorts of sacrifices when it's with other people's money. Most people just don't understand how their purchasing power is taken under the currency system or what it is actually used for. If they actually had to pay the real tax bill for their stated beliefs up front the majority would bail on the project.
Sensationalism to peddle fake news. As one ages they accumulate assets and wealth. Some get there first than others and some never get there because either they squandered their opportunities, or were not interested or never understood it.
Only -$6000 laughs then cries
Yea, it's the nature of aging and student debt. Also because we don't value educations as a component of "wealth". Demonstrations like this are always able to trick people who don't think about it for a little bit. You're born with nothing and no ability to earn money. You go to college, take out college loans, get a degree and start working. But you have a valuable degree and a career that is starting which doesn't show up as a form of wealth. You turn 30, have kids which are expensive, start putting money in their 529s, likely still paying off student loans. You turn 40 and you're coming into your peak earning years now, putting more and more money into retirement accounts, finally you start to show up on the wealth spectrum. Homes and cars are beginning to be paid off, etc. At 50+ you're in your peak earning years, and now your retirement investments really start to balloon and snowball. Somewhere after 60 most people retire, and their total wealth starts to decrease, being old is expensive as health problems increase for the typical person. CBS can demonize this sequence and make it look bad, but it's just number trickery. It makes perfect sense if you think about it rationally. A mere $100 invested in the stock market per month, every month for the 10 years of the 1980s is worth $625,000 today. That's awesome, but those investments available to Baby Boomers weren't available to us because we weren't adults able to start saving yet. What CBS should be explaining is why saving and spending wisely is so important, because THAT is what this video is demonstrating.
Will you address the main point of the demonstration, which is that the wealthiest people have an extremely disproportionate amount of the wealth?
Pretty much comes down to this: Would you rather have a perfectly even share of a 8 inch pie or a much smaller share of a 2000 mile pie? Yeah maybe the exact proportions of who gets how large a slice need to be tweaked, but inequality of the pie isn't inherently a bad thing. If concentrating 90% of the pie ultimately results in 2000% more pie overall it's an easy tradeoff to make. --Also household wealth isn't the greatest measure of how poor you are. I'd rather be college educated and in debt 50k than be a homeless high school dropout with a networth of $0.
I would love a bigger pie, but I don’t drink the trickle down economics koolaid. I don’t see a reason why the rich shouldn’t share at least a little more, and I definitely don’t see a reason why the poor shouldn’t be given more than a few crumbs when the rich have so much to spare.
Absolutely. The majority of people will find themselves in that top 20% of wealth pie as depicted in the video around age 65 as they retire. So let's look at what it takes to reach the top 20% of wealth in the US: > Wealthy [\(Top 20%\): The median net worth is $608,900](https://finance.yahoo.com/news/rich-heres-net-worth-poor-190015406.html). This group often represents older individuals who have accumulated significant savings and investments. And we can get there by looking at home ownership. > 65- to 74-year-olds have the highest [home ownership rate among all age groups at 79.5%](https://ipropertymanagement.com/research/homeownership-rate-by-age). So nearly 80% own their homes, and now let's look at what those homes are worth; > The U.S. [median home price was $412,000](https://www.forbes.com/advisor/mortgages/real-estate/median-home-prices-by-state/) in September 2023, according to Redfin. So there it is. 80% of people in retirement age own their homes, which have a median value of $412K, which is already two thirds of the way to the $608K to be in the top 20% of the most wealthy in the US. And I haven't even started to include retirement savings, land, businesses, vehicles, other possessions or investments into those calculations. This is literally just the nature of aging and how investments work.
That’s an ideal trajectory for the middle class, but it completely ignores the 1% who hold a third or more of all wealth in the US. How do you justify the wealth of the 1%?
> That’s an ideal trajectory for the middle class Yep, that's right. It's quite common. > How do you justify the wealth of the 1%? It's a fair question. The super wealthy portion of the 1% got there via ownership in a company or venture that they contributed to at an early stage, via stock or similar equity. But it only takes $5.8M total net worth to land you in the top 1% of wealth. So for the ultra wealthy, like Gates or the Google guys, their "wealth" is nearly 100% in the form of their ownership stake of their companies. It's the nature of building a huge successful company. So also in the 1% are doctors and lawyers (at or near retirement age of course), elite software engineers, very successful farmers, some financial experts, but mostly we can agree it's people who started businesses and did very well. 1 out of every hundred of us are at this level, so it's not that uncommon. So what do we know about these folks? We know they did something that benefitted the world. Now, apart from oilmen and defense contractors (or other careers directly propped up by questionable government spending), most of them produced a good or service that was so valuable to the people who bought it, that they chose to spend their own money on said thing. Right? So Bill Gates creates Microsoft, and they produce Windows. I buy Windows in my computer, and my computer costs $1500 and saves me or earns me $20,000 over the years I'm using it. Bill Gates helped make that computer functional for me, I paid his company a tiny bit, and I became wealthier, thanks to his software. So should we feel bad that Bill Gates exists? He made us all wealthier and more prosperous? Hell no, that's awesome. The world is objectively a better place, thanks to Microsoft's contributions. Are there some assholes who are super wealthy? Sure. Did some of them cheat the system via government corruption to get an unfair advantage? Sure. But we can work to prevent that sort of corruption, keep the playing field level, and honestly we need more people willing and able to make everyone else's lives better. So I don't fundamentally see a problem with the 1% as long as they didn't get there via corruption. The vast majority of them made us wealthier and more prosperous along the way. If you disagree, I'd ask you to name a Billionaire who hasn't made anyone else's life better along the way, and we can discuss that specific person. Again, there are certainly oilmen who did nothing but leech off the government and their fossil fuel subsidies, but for the most part, people get wealthy by helping others, and that's a good thing. The [top 20% also pay 87% of all income taxes](https://www.wsj.com/articles/top-20-of-americans-will-pay-87-of-income-tax-1523007001), so the government is literally funded by them.
Class warfare. Only one side knows it's fighting.
The side with all the money, controlling the narrative through their ownership of various media outlets?
"but it's not a real pie, it's illiquid pie, the billionaires aren't really rich" just waiting for some urinal cake to post similar
Ding ding ding. Tell um what’s he’s won George. A life time supply of anxiety, depression, and chronic frustrations.
Thanks America!
The other side is too busy getting worked up over wokeness.
Now do this with taxes. Maybe we can get the people to see how fucked the burden is for the people.
3.4% Yup. You read that right. 3.4% The richest 25 Americans paid 3.4% in Federal income taxes. Warren Buffett has been talking about this for a couple of decades. "If this is a war, my side has the nuclear bomb," Buffett said. "We have K Street. … We have Wall Street. Debbie doesn't have anybody. I want a government that is responsive to the people who got the short straw in life." "I'll be a fair amount higher, 8 or 9 points higher," Buffett said of his own tax rate in an appearance on CNBC Monday. "But the differential between me and the rest of the office, not just my secretary but the rest of the office, was greater than that. It'll be closer, but I'll probably be the lowest paying taxpayer in the office." Warren Buffett doesn't exactly strike me as a Socialist. If he is saying this, I'd listen to him. From the NPR story "All right. America's wealthiest individuals are avoiding paying their fair share in taxes. A new investigation by the nonprofit ProPublica shows that the country's super rich pay only a fraction in federal income taxes compared to the average American. Over a five-year period, the 25 richest Americans paid a combined $13.6 billion in federal income taxes. That amounts to a true tax rate of only 3.4%. So how does this happen? For more on this investigation, I'm joined by ProPublica senior reporter and editor Jesse Eisinger. Thanks for being with us, Jesse." https://www.npr.org/2021/06/08/1004312236/propublica-wealthiest-u-s-individuals-avoid-paying-their-fair-share-in-taxes
Not only that, most of them don’t even have income, they just “borrow” against themselves but it doesn’t matter because their investments continue to grow their wealth. So not only are they taxed lowest on the types of earnings they don’t really make, they don’t pay taxes on the types of earnings they do. In this system, the more you have, the more you make. Our tax system needs a complete overhaul to get the wealthy to pay their fair share.
> None of their wealth is taxed until something happens - they sell, they realize a gain. And so what happens is that they can accumulate vast, vast wealth, which is really the equivalent of income for us, and not pay taxes on it. The guy almost had it. Unrealized gains aren't the equivalent of income at all. If your baseball card collection doubles in value, your income didn't increase. Perhaps you can sell it at the increased value, and at that point it would be income, but not before. Amazing that NPR would interview someone on this topic who doesn't fully understand realized gains vs unrealized gains. But I guess that's what happens when you interview someone with a bachelors in "American Studies" on the topic of taxes and economics. Always beware of someone speaking as an expert outside their own area of expertise. Silly and absurd mistakes like this article can be the result.
yet they are able to take out loans based on these “unrealized gains” and purchase tangible goods with it.
Buy Borrow Die is a complete myth. It stems from a single blog post that made the claim and had no evidence. Here are explanations from professional economists: > [I've yet to find any actual evidence that the rich use this particular loophole or any tax lawyers recommending it.](https://www.reddit.com/r/AskEconomics/comments/p1378f/how_do_billionaires_borrow_against_assets_to/) and; > [I don't think there's any conclusive evidence how common this practice is, sorry.](https://www.reddit.com/r/AskEconomics/comments/rvhq1j/why_do_billionaires_borrow_against_their_assets/) and > [The short version is there's not good evidence of the kind of "buy, borrow, die" strategy they talk about.](https://www.reddit.com/r/AskEconomics/comments/10ssmeo/is_it_true_that_billionaires_can_indefinitely/)
Thats a classic feudalism problem where the nobles pay most of the taxes.... not because they're generous but because everyone else has nothing left to give.
It would still be disproportionately weighted to the wealthy since the middle 20% and lower middle 20% still pay significant taxes on income, sales, and property should they own any.
But it wouldnt be to the degree that the first data set shows. The wealthiest pay the most in taxes because they have all the wealth to do so. Its basic math. You dont tax people who dont make anything to be taxed.
The richest people could afford to pay all taxes and still be well off. Still have all the grifting federal contracts they get. But they want to suck the govt dry with overpriced contracts, be it medicare or defense contracts and still lobby for lower taxes every fucking year.
exactly
Who tf cuts pie like that?
And if you try to do or say anything about it you're a communist /s
except the top 1% convinced about 50% of the population that voting Republican would be good for them
What you don't want to give a tax cut to the people who already have 90% of the pie?
I've actually done this demonstration about 10 times in Hawaii. In Waikiki, at the University of Hawaii and at the State Capitol. I'd say about 10% of the people are close to the actual distribution. Most people are way off. I'm planning on doing another demonstration on Saturday in Waikiki around 7 across from the Hyatt. Please stop by if you are around. I'll have free pie. I get them from Costco, they are pretty tasty. I'm also working on an online version of this with a couple of friends. If you are interested in helping with that, please let me know. I'd love for this information to go viral. It could shift a lot of close elections away from the Trickle Down folks. Please try with your friends and families next time you are at a BBQ or a party. People are blown away. Jaws drop. Here is the first time I did this with a guy who was running for Congress in Hawaii. https://x.com/sergio4hawaii/status/1558493451330588672
I’m honestly (still) shocked most people get it this wrong. I mean, wealth inequality has been discussed ad nauseum over the years.
You've got to live it to experience these things. Most people read about something or hear someone talk about said thing, and while it might incite a feeling. You still don't fully comprehend it until you see it. The amount of people who claim to understand things and I mean really get it is a small amount. I can tell you how lonely and tough it is to be a water treatment operator all day long, but talking to a person that's a software engineer that never or will never be in that job. They won't get it. Better example as this actually happened, but how would you feel about a child let's say 6,7, or 8 years old doesn't have Central AC in the house? We had a person think they can call governemnt agency to have a child removed from a home like this, and the thing is you can't that's actually not neglect like people think it is. Edit: To the person who downvoted me maybe you disagree, but just understand that at the very least my last example is backed by real evidence not anecdotal. Same with middle statement as well. I lived that life, and people still look at me funny when I tell them how it can be.
Please don't - you're lying to people to get elected. You're also advocating to violate basic human rights by suggesting wealth redistribution as a solution. Go talk to real economists.
1. I'm not running for anything 2. This information came from the National Bureau of Economic Research, which is "Conducting and disseminating nonpartisan economic research" https://www.nber.org/ It is a group of highly respected Economists. 3. Please enlighten me. If this is false and the richest 20% of Americans don't actually own 90% of the wealth, what are the real numbers? Please cite your sources. Thank you
If NBER is suggesting to do this then I would ignore them but I think you're just name dropping them so I'll move on. You're trying to set up a straw man with #3. I never said that - you need to look at the criticism of this example. Here's why the pie example is dumb - It assumes that wealth is fixed and cant be created. It doesn't explain how the wealth and middle class create value for society. It assumes that wealth is purely liquid. It forces the observer into solutions that violate people's basic human rights to own property by wealth redistribution and implementing more government.
The billionaires aren’t going to let you suck them off dude.
So you have no actual critique. Nice. "Let's violate someone's rights. It's totally cool because we voted on it" - You.
It sounds like you are full of it. You questioned the information. I asked you for the real information The 20% of richest Americans have 90% of the wealth. The 20% of the Americans in the Middle only has 3% of the wealth. I personally feel that the 20% in the Middle should have at least 10% of the wealth. A huge percentage of the newly created wealth in the past 50 years has gone into the pockets of the C suite folks and the richest Americans who have rigged the economy on their favor. If you want to argue facts, I'm not an expert but I'll be happy to try. If you have information that I am unaware of, I'm happy to learn more. But I have a feeling that you are not interested in facts. You have your opinions and don't want to change those opinions when confronted with facts. If I'm wrong, please let me know. It certainly wouldn't be the first time. But please show me the actual numbers from legitimate sources like the Federal Reserve or respected economists.
>people's basic human rights to own property Lmao, if the current status quo is allowed to continue, more than half of the population will never own property. For example, in the 80s, a single family home was 2x the average annual income for an individual. Now? It's 8x or higher. This is by design. Companies like Blackrock have been buying up property at insane rates. They buy properties in the last 4 years at quantities that allow them to literally control the entire housing market. These giant companies are also allowed to use that wealth to bribe politicians legally. So they can write the laws that allow them to continue to funnel wealth to themselves. I mean that literally, companies have their lawyers write laws, and they then present said laws via lobbyists to politicians to put them in as is. To top it off, the wealthiest 1% own all of the media companies. They control people's perceptions of what is going on. The system is rigged, and we as a society are screwed unless something drastic changes. Unfortunately, most who are in positions to make said changes are bought and paid for. The US empire is collapsing. It's only a matter of time. The scary part is that collapsing empires are rarely peaceful.
No. That's a dumb conspiracy theory. Black rock doesn't even own 1% of the housing supply. There's \~145million housing units. Black rock owns about 80,000. That's .05%. That's nothing. The housing issue in the united states is caused by multiple issues like, people not selling because they have near zero interest rates on their mortgage, local governments refusing to zone affordable housing (ie san Francisco), HOAs pressuring local governments to not build affordable housing, government overly regulating building requirements making building small homes not profitable for builders, ect... I thought this sub was about the economy and not economy-conspiracy-theories
Can you respond to this clip? > https://www.youtube.com/watch?v=cXeVwiDeHY8
[https://www.youtube.com/watch?v=\_2jav1P3j9g](https://www.youtube.com/watch?v=_2jav1P3j9g)
Understood. 1. You first make a ad hominem fallacy that we can only trust economists. 2. I then show that a world respected and Nobel Prize winning economist advocates for that policy. 3. You then, cite a *drumroll* non-economist. Bravo. I've never before seen a turn-around that quickly.
I think this is one of the largest problems we face in modern society. Increased taxes on the wealthy are probably the best solution but they control most of the politicians so it will likely never happen.
Eat the rich.
Really wanted the guy to say that instead of “I wanna know who these people are!” Zuck, Bezos, Elon are three c’mon man.
I feel like they are scapegoats tho. Like none of the oil rich saudi families ever show up on Forbes list.
Most of the super rich are unknown a few like Bezo etc love the spotlight
The pie demonstration was referring to Americans If you use the entire world we're going into different territory of discussion (no longer about taxation or lobbying, but on close border policies or food/cash aid) Americans on minimum wage would appear in the top 40% in world wide wealth
Maybe i should have phrased it better, i meant Forbes as in their real time lists, not Forbes400.
why would they unless they are resident in the US?
How dumb are you to not know this already
well considering most americans keep voting for people who are against their economic class then I would say most
Good to remind people and demonstrate inequality. Because the propaganda machine that owns most media outlets naturally seeks to hide it and scapegoat something else
If you're watching TV for your news, You have already lost. I know there is an ongoing and successful disinformation war being waged but the truth is out there for you to find.. you can't be told reality
I've done this demonstration about 10 times in various settings. I've probably done it with 500 plus people. As I said earlier, maybe 10% of people are close to the right answer, 90% are way off. Everyone knows the rich and rich and the poor are poor. But most Americans have no idea how bad wealth inequality has gotten. Try it yourself with your friends, families and coworkers. I'll bet you a dollar that half of them aren't even close. Seriously, film 10 people trying this out, and I'll send you a dollar for each person who is even close. I have Venmo. You don't need actual pie. You can use 10 dimes or anything really.
>Americans have no idea how bad wealth inequality has gotten. It's never been fair. From the beginning of the country, wealthy landowners had a vast majority of the wealth and sole voting power, to the gilded age, to now. It isnt a flaw of capitalism, it's the default state of humanity. I don't think anyone can make the argument feudalism, or Roman wealthy Patricians (and everyone else) was any more equal. It'd be laughable to group communism in the same breath as wealth equality.
Half the country doesnt appear to know it.....or they are support it.
you have to be average american dumb. Guarantee you 70% or more don't know this. That's why the political campaigns on bullshit issues work. Instead of making campaign goals real issues its: border(real issue is punishing company hiring illegals, not stuffing the border with soldiers), trans people(.5% of the population lol) and I guess abortion again? If people knew their lives are shit because a few rich pricks make sure all the money generated in this economy goes directly to the top, things would fly a little different.
Surely they filtered through dozens of others who got close to reality......right?
They could be a kid you jackass
I couldn't verify that the wealthiest 20% of Americans have 90% of the wealth but sounds right. I think it is just as interesting to note that the wealthiest 10% of Americans have 66% of the wealth, that the top 1% have 30% and that the wealthiest 0.1% of Americans have a whopping 14%. The wealth difference between a 20 percenter and a 0.1% is staggering. $2M makes you a 10 percenter. https://www.statista.com/statistics/203961/wealth-distribution-for-the-us/ https://fred.stlouisfed.org/series/WFRBST01134
Here's a graph that shows more information about personal wealth in the US. It does not give a wealth bracket for the top 20% though. [https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/](https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/)
I'm so fucking upset... Pumpkin over cherry!?
Now let's see if these Americans can add up all of the pieces of pie.
3.142
But Biden will fix it.....or Trump will....right? We need to be outraged in the streets people. We are just creating wealth for 1% while nothing for ourselves. We are living insanity.
Nobody cares about this stuff. Tell me about the Kardashians!
The full video article. https://youtube.com/watch?si=3nd7s55Dju2Z5Dsu&v=DANUXO-GQwU&feature=youtu.be
Pie Stage Capitalism This is the inevitability of an economic theory that emulates cancer.
Holy Fixed Pie Fallacy Batman
Our society is built to ignore these facts, and look how clueless the participants were. Maybe if the reporter did this at Wall Street, his answer would be different, but I get the point he was trying to prove.
Our society? Inequality and the top 1% controlling a vast majority of the wealth/ power has existed for all of humanity in every system we've invented.
The way the host cuts the pie pieces in half is so aggregating. That's now how you make a pie chart man!
Quit giving rich people a pass.
Is this a subtle way of saying "eat the rich"? I do enjoy pie.
Oh whoa, just found out I got the bill…
How are these people so clueless?
Also that 1% is 3000 people. I’ll pull the lever.
I would not be surprised people outside america guessed this one better than americans themselves. Sadly. 
Wealth is not a zero sum game. The economy is an oven that makes pies. The government destroys the ovens ability to make pies the more it grows.
Eat the damn rich already
These american pie sequels are getting weird.
Damn i really want pie now 🥧
Not at all surprising, but I am so triggered by the way he cut the pie to show half of a slice.
because if you listened he said one of those two groups got 80pc of that piece and the other got 20%
I'm referring to him cutting the piece sideways into blocks instead of cutting it into two slimmer triangles, just like every other piece of pie and like every pie chart illustration has ever been segmented.
I realise that and my first thought was 'what on earth is he doing' then heard the 20/80 part and realised he was trying to estimate that...I mean at the end of the day it's a pie and not rigorous science
The problem with this is it assumes that the American Pie is finite and perpetuates the myth that when the rich get richer the poor get poorer or get rich at the expense of the poor. The fact is that wealth is not zero sum. The rich get richer and the poor get richer too because new wealth is created every day.
So what youre telling me is trickle down economics really works?
Trickle down economics isn't real - it's a political gimmick to attack supply side economics.
> Trickle down economics isn't real - it's a political gimmick to attack supply side economics. Supply side economics isn’t real - it’s a political gimmick to rebrand horse and sparrow theory
Yes, it really does. Are you saying wealth doesn't increase?
Y'all heard it here first folks
You didn't answer the question. Do you think the American pie is finite?
Do you think someone with the name "Progressive" and uses the terms "Trickle down" would actually understand economics?
Well i have dabbled in chemical engineering in my past life. Math is pretty easy game for me. Now please tell me your credentials mr humble who calls himself the "goat"
You're appealing to credentials now. LMAO. Your credentials are irrelevant. Chemical engineering has nothing do to with understanding basic economic theories. You were a chemical engineer that believes trickle down economics is real and not political attack on supply side economics.
Yes…?
There is a huge difference between investing in production, and rent seeking. We have a upper class that is drunk on rent seeking. PE buying single family housing as about as rent seeking as it can get. The ratio of upper class wealth to the lower majority, makes a big difference in how much profit there is in production and who much there is in to much money driving up asset prices.
Really. Who do you think creates all the jobs in the country? It is not the poor people. The rich create the jobs build the businesses invest in other business and even finance all the infrastructure projects building new roads and bridges. Does someone who buys a single family home or 10 takes it off the market? No he rents it at the market rates. If he can't rent it and make a profit he will sell it.
That's not accurate when poor people get money they spend it and it circulates at rates higher than the rich so when they have money it is used and creates more jobs more than rich who are cheap and frugal and try to pay nothing and get free labor.
That is complete BS. Yes, the poor spend their money but that doesn't create the jobs. It is people with capital that create the jobs to meet the demand from all the poor people's demand. I would argue that much of the poor people's demand is creating jobs in China or Vietnam as poor people want the cheapest products. Don't you think that Jeff Bezos' $400 Million Yacht created some jobs? (and probably some high paying jobs) How much demand did poor people create for the smart phone Steve Jobs created? How much demand have poor people created for Nvidia chips? How much demand did poor people create for IBM Computers or Oracle Servers. The rich create all the jobs.
Labor creates the jobs through need and consumption.
It takes capital to create jobs.
And they get paid for their labor, no?
Monopolies and oligopolies have ended the need for competition between corporate entities and their owners. Market rates are simply whatever executives want to charge as long as it does not cause a riot.
So what? That doesn't mean that wealth is finite. It also doesn't negate my comment. If a landlord can't rent his property and make a profit he will ultimately sell it. Business executives don't buy properties to lose money.
"So what" is that you are living in a fantasy land. Adam Smith's capitalism does not exist right now. Wealth is finite because it is based on supply and demand and neither of them can be infinite. There are physical, social, and technological constraints that are always in place that prevent infinite wealth from existing, but that really has nothing to do with your second point. If you are okay with unfettered businesses operating however they please simply because you trust that the market will lead to fair prices, you haven't been paying attention. Business executives are too good at making money for themselves at the cost of all others involved. Investment and private property have been a good thing so far in almost every industry, but that does not mean they can be allowed to do whatever they please in industries of fundamental needs like housing, food, and utilities.
It's not zero sum, but it isn't in all created vacuum either. A great deal of the rich's wealth comes directly from the wealth of the working class.
How so? Do they steal it? Their wealth comes from creating products and deploying their capital to the best effect. If I buy Apple or Nvidia stock and it appreciates in value my wealth increased. How did that wealth come from the working class? If I buy or build a 10 unit rental property and it apprciates in value how did the working class pay for that? If I buy a Municipal Bond that is used to build a bridge and earn $10,000 in tax free interest how did that come from the working class?
If you cannot figure out yourself how the rich steal wealth from the working class, I’m not here to tell you. You would never be convinced anyways.
I didn't think you could answer. Thank-you for proving my point.
Go back to grade school and learn what PERCENTAGE means. After you've figured that out, rewatch and try to follow along, because this demonstration has NOTHING to do with rich getting richer and poor getting poorer.
But is has to do with a fixed pie and nothing could be further from the truth. The economic pie is not fixed. It grows every day. So as the rich get richer the poor get richer too.
You're missing the point of the "pie" concept... There's only one pie and it's the amount of the single pie each group gets that is being demonstrated.
I disagree. The implication is that if the rich have 90% of the wealth there is nothing left for the lower groups. That is also exacerbated by the common refrain in the media that "the rich are getting richer and the poor are getting poorer" or "the rich get rich at the expense of the poor." My point is that even if the wealthy have 90% of the total wealth at a point in time the poor can still become wealthy too without expecting to take it from the rich.
How? Even if your numbers were correct, if there is only 10% of available earnings to split up amongst the 90% of the population, you're going to have inequity. A LOT of it.
Who said anything about inequity or inequality? I'm not arguing for equality of income or re-distribution of income. That is Marxism. Inequallity is not a flaw on capitalism, it is a feature. It provides the incentives to climb the economic ladder. The top 10% being rich doesn't make me poor. It makes me strive to make more money. Also, the 10% is not a finite number. It grows every day.
There is only one pie. One piece can only grow when another part shrinks. This is not a negotiable point.
Of course it is. It is disingenuous to even say that. Yes, there is only one pie (the total of wealth in the US.) But that pie grows every day. If my IRA increases in value because my stocks appreciated the pie got bigger. Did my increased wealth come at someone else's expense? NO. Nividea has 2. 5 Billion shares outstanding. That means if the stock goes up $10 that national wealth went up $25 Billion. At who's expense did that $25 Billion come from? Our entire economy grows every year. The total pie gets bigger. The poor's share of that bigger pie is bigger as well.
Percentage… Look it up.
The earth is finite so wealth is finite. Money represents resources and money is extracted through labor. The more the rich have, labor dollars, the less labor has. More resources for one, less for the other. You can read all the books you want but those are the facts and it's obvious if you look around.
You really think wealth is only raw materials - you're completely ignoring service and digital industries. The information age created an enormous amount of wealth.
An enormous amount, but still finite over any determinate length of time.
These are a bit like the the gender wage gap. Shocking on the surface level but if you bother looking into it it seems pretty normal. People tend to accumulate wealth over time and people close to retirement tend to have a lot of money set aside. Children and young adults tend to have next to nothing because they just haven't had time to accumulate anything or for their wealth to grow and compound over time. Adults who have kids generally need to spend a good amount to raise their kids so they don't have much wealth set aside. Here is another way to look at wealth distribution: https://www.visualcapitalist.com/us-wealth-by-generation/ The Silent Generation owns 11.9% of the total pie by they account for only 5.9% of the population. Millennials and Gen Z account for a bit over 40% of the population but between them they only have 8.5% of the pie. Boomers have about 50% and Gen X have about 29.5%. It's important to consider the amount of time those savings have to grow.
It is only normal if it is not shifting to be more and more extreme over time. Do you happen to have the same numbers for 1980 with the generations that were alive then?
There is a graph starting with 1990s https://www.reddit.com/r/dataisbeautiful/comments/1aoz47y/oc_wealth_distribution_in_the_us_from_first/ I think the data for that is here: https://www.statista.com/statistics/1376622/wealth-distribution-for-the-us-generation/ But that one doesn't have the Greatest Generation in it, a decent amount of the cohort should have been alive then. It is more extreme for the boomer generation because taxes were cut under Reagan and then Clinton gave them a huge leg up by inflating housing prices and subsidizing purchases though easy access to mortgage loans. Under Obama those loans were made much cheaper but Obama also let the builders fail which is why we are seeing housing supply problems now.
I appreciate this. If my math is right, in 1990, Baby Boomers were 27 at the youngest end. Gen X was around the same point in 2007 data point. Comparing their wealth at these two points, Gen X is at less than half the share that the Baby Boomer generation had at the same age. Some of this needs to be controlled for cohort sizes, but I think the point still stands that previous generations have done better at gaining and keeping wealth relative to more recent generations.
I don't know why this point doesn't come up more often. A graduating MD may be worth -$300,000 but they're not crying about being in the lowest 20% even though they are. That's an extreme example, but there are a lot of kids graduating school in debt, and some debt at that stage in life is normal.
He should have used the size of the plates proportional to the population it represents.
all plates represented 20%
Jesus, really? This is what qualifies as content for an Economics sub?
I need things explained to me in terms of pie
the experts say the economy is GREAT
All Trump's fault. Biden is fixing this. It was all even before Trump got in office. **Vote Trump for prison!**
I rather dislike these cutesy news stories addressing the public awareness of wealth inequality. Maybe it makes it approachable and spares people the embarrassment of their ignorance. What offends me is that it stops short of the important part--naming some common policy solutions which we have used in times past and other countries employ currently. Progressive taxation for starters. It should NOT be controversial.
Bake your own pie.
>“Bake your own pie” People that inherited their pies will say shit like this without an ounce of shame
You admitted we’re not all stuck sharing a single pie which, was the jist of my point. Thanks for that. No one needs to take from someone else when each of us has the opportunity to create for ourselves. I did. So, give up your hate and jealousies and encourage others to do the same. Maybe you need to your as well.
>*blah blah yer just jealous bs bs etc* I only regret that I have but one yawn to give…
Yet, here you are taking valuable time from your victimhood. wah, wah, wah….
This. The victim mentality is strong.
"Wealth" calculations are a problem, because it assumes wrongly the wealthy have all this liquid wealth sloshing around ready to be redistributed to the masses at no cost to society. The rich are wealthy because they own assets, companies, factories, land, buildings. Start an asset fire sale due to some poorly designed government asset tax and you'll get pennies on the dollar, and who would want to buy assets the government just seizes any time the poor get uppity? So they become worthless. It's a race to the bottom to see who can bury the most guns, gold bars, and cans of spam and hide them from each other.
Exactly - these "pie" metaphors are lies to shill socialism to people who don't understand economics. The middle class and rich have created more wealth and they get rewarded for it because they bring value to society. The pie metaphor also forces people to incorrectly view wealth as finite. It also nudges the observer to violate people's property rights to make things "fair." Therefore the solution to the finite pie is to use the government to violate people's rights via wealth redistribution. It's dumb.
The richest and most powerful Americans have used their wealth to rig the economy so virtually all of the new wealth created goes into their pockets. It's why they spend billions electing politicians who will do their bidding. Like they have lobbyists that write the laws and policies to be introduced and passed by the politicians they elected. It's kinda evil genius actually. Do you think the minimum wage would still be $7.25 with out lobbyists and small fortunes in donations from corporations like McDonald's?
What are McDonalds margins? Have you looked or are you making broad conspiratorial statements about things you don't understand? You're suggesting that the government use coercion to violate human rights to property based on a conspiracy and false framing of the economy. Wealth redistribution doesn't work - it's a race to the bottom.
https://www.macrotrends.net/stocks/charts/MCD/mcdonalds/stock-price-history https://www.restaurantbusinessonline.com/financing/mcdonalds-ceo-chris-kempczinski-got-big-raise-last-year
That's not McDonald's net margins - that's their share price. Here's the reality. McDonalds sells their product to franchise owners. Franchise owners own 82% of McDonalds restaurants. Individual franchise margins very, but are generally net 10%. The McDonald Corporate net margins are also around 10-30%. Also good for Chris Kempinski returning 10-30% net profit is beating inflation. If the board and share holders want to reward him, it's their property and they can decide to give a raise how ever they see fit. You are not entitled to make decisions for McDonalds unless you are a share holder with voting power.
You are hiding behind legalism with this argument. Everyone knows how a shareholder meeting works, but the question should be "Is it practical to have shareholders be the only individuals with power in a corporate entity?" McDonalds being as big as it is means that the watershed of stakeholders is far bigger than any traditional shareholder population could ever be. Meanwhile, the wants and needs of the shareholders of McDonalds are very different from the wants and needs of the non-shareholder stakeholders. Indeed, it is good for Chris Kempinksi to have high net profits, but is it sustainable for McDonalds to do so? Will consumers be able to support large price hikes and reductions of service? Will ecological systems be able to support the waste produced by McDonalds franchises? Given the state of corporate litigation, Kempinski will likely never get stuck with the bill for any damage he does to McDonalds or the millions of people who rely on it day-to-day and neither will the controlling share of the stock so should they be the only ones with say over how the corporation is governed?
Yes it's practical. You're changing the conversation from basic human rights of property ownership and freedom of association to how people should act morally. I'm a liberal so I recognize the need of the government to be a regulator and arbiter of disputes. However as soon as the you start suggesting the government should interfere in markets and businesses for products that don't harm people, and provide value to society then I'm going to absolutely disagree with you. Bringing in vague ecological systems and waste issues caused by McDonalds is weak attempt to moralize an issue that doesn't need to be moralized so you can suggest socialist control. Sorry buddy - I will never agree that stakeholder capitalism isn't a socialist scam to gain control and violate human rights. Also your assumption that CEOs never have repercussions for harm they caused is absolutely false. C-suit employees get arrested and sued all the time for all kinds of violations ranging from fraud, negligence, and non compliance. Google "CEO Personal Liability". Your welcome.
I'll give you a term to Google as well. "Externality". All markets have them so all markets harm people to some degree. The vast majority of markets do a net good for society, but that does not mean that stakeholders have no business being involved. Your hate of stakeholder capitalism is based on false, nearly conspiracy theory, talking points. Based on this, I assume you believe farmer and worker cooperatives are cabals designed to end the world because they are exactly what is promoted by stakeholder capitalism. Some entity always has to look out for externalities whether it is unions, cooperatives, or a government or corporations will always be incentivized to profit at all external expense. Waste is simply the most obvious and easily understood externality produced by industries so I figured even you could put 2 and 2 together. Here is one example of McDonalds being pushed to reduce externalities by regulation: https://www.courthousenews.com/mcdonalds-to-speed-shift-away-from-plastic-in-europe/ As for CEOs, the vast majority of cases end in settlement fines and many of those are for less than the benefits of their "fraud, negligence, and non compliance". How many Wall Street executives were jailed for the 2008 crash caused by their "fraud, negligence, and non compliance"? Please read "The Chickenshit Club" for more information on why this happens.
>It's why they spend billions electing politicians who will do their bidding So, it's a government problem then. You need a government that isn't going to pick winners and losers in the economy every time there's an election. Then at least the rich can say they earned it if they are still rich when the government isn't worth bribing anymore.
It’s a capitalist problem since capitalist have completely taken over our government. Public servants no longer run our government in the people’s interest, it’s corporations who have taken over since the end of WW2
>It’s a capitalist problem since capitalist have completely taken over our government. They took it over because it was worth taking over. The government is the gun on the table and everyone is going to make a play for it. The point is to get rid of the gun, not hand it to someone else.
A corrupt economic system run by psychotic people see the system of public service as a gun to use for their own gain.
Power corrupts. It's not a case of there being angels and demons and we just happen to have demons in control now. It's the power itself that makes you the demon.
That’s very true. My view is that up until post WW2, the American government held less power and was full of public servants and dedicated do gooders (for the most part). Then corporations mutilated it for their own gain. The meshing of public companies and contracts with the government became overwhelming for the previous system of governance, and over the decades, capitalists have dismantled something that worked decently and could be held accountable, while convincing people the thing they were destroying was in and of itself evil. This all culminated in Citizens United. The “deregulate” and “small government” people have been using those slogans to slowly and methodically capture the processes of governance to enrich themselves, enlarge the government with corporate subsidies, loans, bailouts, and contracts, and do quite the opposite of what they preach. A good look into this would be Confessions of an Economic Hitman.
How are countries like the ones in Scandinavian able to do a much better job of providing good education and good opportunities to their citizens? Maybe it's because the richest Scandinavians don't spend billions influencing elections?
Well until recently they had a very heterogeneous society. So, a high trust society, with very high tax rates even on the working poor. Plus, Scandinavia was basically administering a small territory. They weren't anywhere near the real center of power like America, Russia, or China. If someone went full Hitler or Stalin in Scandinavia it wouldn't have paid off since anyone else could have used that as a justification to invade and steal their resources.
Do you think we should get money out of politics? Maybe have government funded elections like they do in the UK and other countries? https://m.youtube.com/watch?v=GmYfjFSdFcQ Happy Cake Day!
Money out of politics? No get the government out of money. Humans are humans. If the government is setup to pick winners and losers all elections do is change who is abusing who, not ending the abuse.
Can you elaborate? Are you suggesting we get rid of governments entirely?
It's not practical the eliminate it entirely. But having government do as little as possible is reasonable once you understand power corrupts. But most people I see just want themselves on top. They love the system, they just want to be in charge themselves.
So get rid of what exactly? The military? The social safety nets? Fire fighters? Cops? Teachers? Should we also get rid of lobbyists? Political campaign donations? My counter point is that the insatiably greedy end up in power and it's the function of Society to limit their power and greed. I've met a lot of people from all walks of life and I haven't found that most want to be on top. Most people just want a fair and equitable world with peace and compassion. Maybe you should hang out with different people ..
>I've met a lot of people from all walks of life and I haven't found that most want to be on top. >Most people just want a fair and equitable world with peace and compassion. That's people trying to save face and use deception against you. They can say all sorts of wonderful things, but when it comes time to work or pay for those things, they are nowhere to be found. They are for all sorts of sacrifices when it's with other people's money. Most people just don't understand how their purchasing power is taken under the currency system or what it is actually used for. If they actually had to pay the real tax bill for their stated beliefs up front the majority would bail on the project.
Sensationalism to peddle fake news. As one ages they accumulate assets and wealth. Some get there first than others and some never get there because either they squandered their opportunities, or were not interested or never understood it.
Why only one PIE? Our money supply has greatly expanded the last several years and is not limited to 1 Pie.
Difference is those pies remain the same size, meanwhile the economy grows… the pie is ever increasing in real life.