Friday, November 4, 2011

The 99%ers: Part 1


To quote Pogo: “We have met the enemy and he is us.” Recently, I receive this email and link. It’s good material for some serious thought. It will be the point of departure for the next few postings. Unfortunately, it’s also fodder for political, posturing often done without any thought. The postings will stick to measurement issues and try to avoid the politics.

“I understand the targeting of the 1% of the population that holds 40% of the wealth. By that standard, I would argue that the number of Americans is well over 1%. When all of Africa and Asia are added into the base, we are very well off. I would think that an annual income of $500.00 would put someone into the top 1% of the world. However, I have no data to even begin to figure out the US wealth ranking per capita. So I share this rant for your fun, and wonder what your thoughts are......
An interesting rant....”

Agree. Americans who rant about the wealthy should rant into a mirror. They are the wealthy.

Even so, globally, the leveling of the wealth and the income distributions are the big events of the 21stcentury. While you point to Africa and Asia, one used to say everything outside Western Europe, Australia, and English speaking North America. However, the increases in average incomes in China, India, Southeast Asia, Eastern Europe, Latin America, etc. have narrowed the income gap. It takes a lot more than $500 today, but still much less than the US “poverty” level. My guess is someone who gets unemployment insurance for a year would be upper income in most of the world, and if they lived like a local, would end up wealthy.

Globally, inequality is decreasing. Still, all Americans except a very few are richer than most of the world’s population by order of magnitude. THE ECONOMIST MAGAZINE had an interesting supplement on this recently. The title was something catchy like: Surprise, inequality is decreasing. It pointed out that inequality is increasing in many countries, but deceasing globally because of narrowing differences between countries. It focused on income rather than wealth. So, the data aren’t directly relevant, but the discussion of issues related to international comparison is interesting and relevant.

Funny thing is, no matter how big, fast, tough, or sexy one is, there is always someone bigger, faster, tougher, or sexier. The same is true of wealth. If others’ wealth makes one envious, covetous, or resentful, welcome to a miserable life. It’s sad when Americans (and Europeans for that matter) who are the wealthy of the world, make fools of themselves this way.

It seems that envy and resentment tend to cloud people’s judgment. Also, some people think a good rant gets it off their chest and they’ll feel better: I haven’t seen that very often. Rather, it seems to make them unhappier as often as not.

A lot of Americans are thinking about the issue in terms of an exclusively American perspective. My overall thought is that the entire issue of wealth distribution in America is a smoke screen to cover-up policy failures.

Regarding the targeting of the “1%,” I’ve never been able to get into the envy and resentment thing. I don’t begrudge anyone their success. It isn’t a zero sum world. Their wealth just makes me better off.

The 99%ers as used below refers to a political posture, and 1% is used to refer to those the 99%ers think they are targeting. Here’s an interesting aspect of the international dimension of the 99%ers. The 99%ers probably think they’re making common cause with the Greek rioters. Whether they’re in the 1% is questionable, but clearly Greece is looking mainly to other Europeans to bail them out. Seems ironic that people protesting capitalism in the USA think they’re making common cause with Greeks protesting their socialist government.

So, you say: How does that relate to Americans as a gaggle of people in the 1% globally? Although one doesn’t hear much about it, the IMF is on the hook for part of the bailout, somewhere around 23% at one point. Who is the largest contributor to the IMF? You guessed it, the USA. Thus, some of the 99%ers will be bailing out other 99%ers, but look at it globally and a substantial portion of 99%ers on both sides of the Atlantic are actually the 1%.

It looks like IMF could be asked to do more. This organization, designed to help poor countries, may have to ask for contributions from low income countries in order to finance assistance to a relatively developed country. The 99%ers should look in the mirror, and shouldn’t be very proud of what’s staring back.

No comments:

Post a Comment