Re: how to compare living standards
- From: William F Hummel <wfhummel@xxxxxxxxxxx>
- Date: Mon, 01 May 2006 13:04:29 -0700
"William F Hummel" <wfhummel@xxxxxxxxxxx> wrote in message
news:c73552drekka2050rairr6sife6of1gr0t@xxxxxxxxxx
<wfhummel@xxxxxxxxxxx> wrote:
I wonder whether this is real physical assets or just paper.
The latest figures show that 1% of the population owns about 50% of
the wealth in the US, and growing.
The figure I quoted refers to non-home wealth and came from Edward
Wolff, professor of economics at New York University, writing in May
2003. Non-home wealth is meaningful because people have to live
somewhere.
Hi,
I bet that "wealth" excludes more than housing (which is the largest chunk
of "wealth" for many households). I bet it also excludes cars and clothes
and food and furnature and most of what normal people own. It probably
includes mostly stocks and bonds.
The data I quoted from Edward Wolff (1 percent of the population owns
about 50 percent of the wealth) includes all the items listed below
except homes.
Total personal wealth in the 1998 survey included your home, as well
as other real estate, any small business you own, liquid assets like
savings accounts, certificates of deposit, money market funds, bonds,
other securities, stocks, and the cash surrender value of any life
insurance you have.
How about any pension or Social Security claims that they have? Or IRA's?
Pensions and SS claims did not appear in Wolff's list. However I
suspect they were omitted because the list was already long.
Referring to total wealth the richest 1 percent of households owned 38
percent. The top 5 percent owned 59 percent. The top quintile owned
80 percent.
That sound like the 80/20 division that seems to apply to just about
everything. The top 20% have 80% of the total.
If true, that's an ugly statistic.
Recall the earlier thread on the claim that wealth is distributed according
to the same equation for all societies.
http://www.geocities.com/capitolhill/4834/ineq3.txt
I doubt that is true. There are many societies with a much more
egalitarian distribution, including notably Japan and the Scandinavian
countries.
.The bottom quintile had no wealth on average. They
either have no assets, or their debt equals or exceeds their assets.
I think the real concern is not with the wealth or income distribution at a
given time, but with the degree that individuals change their location in
the distribution with time. If few young people own a house free and clear,
or have a high income job, but if most of them do when they are 50+, then I
don't see that as being a "problem".
Well, you have assumed away the problem with your premise. There are
a great many poor elderly folks who have never had enough money to buy
a house.
Is the distribution of "wealth" however defined, more important than the
distribution of consumption?
Who can say? Is revolution better than war?
Note that consumption is distributed more evenly than wealth.
Agreed, if you are talking about calorie intake. But tamale pie isn't
quite the same as porterhouse steak. And a 1988 Honda Civic hatchback
isn't quite the same as a 2006 Lexus RX 330.
http://pages.stern.nyu.edu/~fperri/papers/consinc_restud.pdf
The median household had a wealth of $62,000 compared to the average
wealth of $12,500,000 for the top 1 percent.
But what if the "rich" are old and the "poor" are young? And the old rich
today were the poor young of 50 years ago?
Yes, most of us accumulate some wealth over time. But how do you
explain the huge number of elderly people who don't own the average
$12,500,000 or even $62,000? What was it that Marie Antoinette said
about the poor?
Yes, I do mean the USA, and that is precisely what is worrisome. We
.....The inequality is no doubt worse in 2006.
Er, you mean in the USA? Because that is not the case world wide. The
world has been getting a lot "more equal", and I think that is good.
And the growing worldwide equality is related to the growing inequality in
the USA.
are headed toward greater social friction every year that the wealth
and income gap widens. The (adult) immigrant worker, with little
wages and no wealth but playing a significant part of wealth creation
in the USA, is even today showing us what may be in store down the
road.
.
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