
Americans Are Horribly Misinformed About Who Has Money - Hoff
http://www.good.is/post/americans-are-horribly-misinformed-about-who-has-money/
======
cletus
I find posts like this one depressing. They're cynical and shortsighted.

The premise of such posts is that if people were aware of who was getting a
tax cut they would be against it. Put another way: the premise is that
everyone is purely motivated by self-interest.

There are two immediate problems with this line of thinking.

The first is tha it ignores how aspirational people are.i remember a survey
from the 2000 election when Gore made the mistake of demonizing the top 1%
repeatedly. The survey show something like 19% of people thought the were the
top 1% and another 20% thought they would be someday.

The second problem is the whole "money for rich people = bad" argument. Some
may ascribe to Reagenesque trickle down economics. Others may see that
overtaxing the rich is ultimately shortsighted. Yet others may not get hung
upon percentages and look at the absolute tax burden (iirc the top 1% pay ~40%
of the tax burden).

Personally I just object to the tone of the rhetoric where politicians talk
about "affording" or "paying for" a tax cut like they're giving away money.
The reality is just that they're taking less money. Bit of a difference.

All of this is just "policy theatre" however. What the US (and most of the
West for that matter) is facing a far bigger problem that the current systemis
unsustainable and no politician wants to be at the helm when the music stop
(to mix metaphors) with declining birth rates and increasing life expectancy.

~~~
jonhendry
" The reality is just that they're taking less money. Bit of a difference."

Can you afford to take a year off from work? It's just taking less money. The
fact is that tax cuts aren't free. If they aren't matched by spending cuts,
you're just deferring the tax increase until later and incurring deficits in
the meantime.

So you have to decide what you're going to cut. Which means weighing, say,
decent healthcare for veterans, versus the benefit of the tax cut to people
who are probably quite well-off already.

The Republicans in the Bush years were not willing to do that. So they cut
taxes. And raised spending. And we could afford neither.

~~~
cletus
Nice try but no sale. This is the problem: talking about this issue will get
you labeled as being anti-<insert emotive issue here> (health care for
veterans in your case).

The budget is blowing out for three reasons: Social Security, health care and
the military. Of the three only the last is largely discretionary (being the
ongoing cost for campaigns in Iraq and Afghanistan).

When FDR introduced Social Security there was something like 50 working people
for every retired person and the average life expectancy was probably only 60
or so. It's a straight money goes in money goes out system with no saving or
planning for future spending. Everyone knows this is unsustainable. It's
merely a question of when something will change and what. The smart money is
on raising the retirement age.

Health care costs are spiraling. This is a much more complicated and multi-
faceted problem. Personally I think part of the problem is the blank chewue
mentality we have to health care. Basically it doesn't matter how much it
costs to research and develop pharmaceuticals and medicine, we expect to be
provided it. So companies largely ignore the costs.

It's a bit like saying to a subcontractor: you can choose to spend as much as
you like and I'll pay you a 20% margin on top of that. What is the motivation
of that subcontractor and the inevitable outcome?

Also I think you need to look at the structure of the health care system. I
suspect the US has the most expensive health care in the developed world. I
think systemic inefficiencies and overprotective IP laws play a bigpart in
this.

~~~
jshen
I'm kind of confused. The big three are our biggest expenses (which includes
healthcare for veterans). So giving tax cuts to the super rich (or anyone
really) without addressing the big three is the problem that the person you're
replying to is pointing out. How is that a "no sale"? Cause he mentioned
veterans?

~~~
cletus
<http://www.comw.org/qdr/fulltext/100223williams.pdf>

> Growth in Budgets for Military Health Care

> The DoD's health care costs rose from about $20 billion in 1998 to $47
> billion in 2010 (FY 2010 dollars)—an annual growth rate of 7.4 percent above
> inflation. Absent changes in policy, CBO projects they will at least double
> between now and 2028.

It's no sale because it's ~2% of the budget masked in emotion, which is at
best an irrelevant distraction and at worst a deliberate attempt to demonize
opposing views.

Limit the focus to just the (increasingly ill-named) "defense" budget and even
then it's only around 10% and is dwarfed by the cost of discretionary
operations within that budget/department.

~~~
jshen
I think your focus on this one example instead of his larger argument could
also be considered an irrelevant distraction. VA benefits are part of two of
your big three so they seem relevant to me. In order to cut taxes we have to
cut something from the big three and VA care is such a thing that could be cut
to pay for tax cuts. It seems completely relevant to me, and yes it is
emotional, that's why we never deal with this problem. The estate tax is
emotional too, especially when called the death tax. It seems impossible to
talk about this stuff without dealing with things that are emotionally
charged.

------
waqf
The question they asked is difficult to interpret, i.e. hard to translate
between specific answers "I think the top quintile possesses N% of wealth" and
an intuitive understanding of how skewed (or not) a distribution we're talking
about.

I have a strong quantitative background, and I have to do some calculations to
interpret these numbers. And these guys are interviewing average Americans and
inviting them to pull numbers out of their ass. Cognitive biases are going to
skew these numbers horribly: people will sooner say 80% because it "sounds"
like a much more "reasonable" answer than 99.8%, even if a little math would
show that it wasn't.

For example, I'd like to see the study done again with people asked the
mathematically almost-equivalent question: what do you think is the average
wealth of the top (resp. second, etc.) quintile. (Almost-equivalent, because
you have to tell the respondents the total amount of U.S. wealth for them to
be able to convert one answer to the other.) Without that control I think the
results are worthless.

~~~
jfager
_Cognitive biases are going to skew these numbers horribly_

I guess I thought the point of the article was to demonstrate exactly this
skew.

Where does a person's emotional reaction to tax cuts or welfare come from? If
people casually think that poor people aren't as poor as they really are and
that wealthy people aren't as wealthy as they really are, they're going to act
accordingly when it comes up in their daily life. How they actually think when
forced to confront real numbers seems less relevant in that case - how many
people actually sit down and do the math before deciding who to vote for?

~~~
waqf
You missed my point, or at least part of my point. The point is that the
numbers people write down in this survey will not accurately represent their
_own_ impression of how poor poor people are.

~~~
jfager
I don't think I missed your point - you're saying that people confronted with
a question they aren't qualified or interested in enough to answer
thoughtfully will be biased towards responses that "sound good".

I have no disagreement there, I'm just saying that it's still interesting to
know what that incorrect "sounds good" answer is in this case, because it
reflects how people casually regard an issue. My unsubstantiated hypothesis is
that this casual regard may actually be more important anyways, because many
people aren't thoughtful in their regular daily lives, either.

In other words: if a cognitive bias can affect how someone responds to a
survey, why can't it affect how that same someone acts in their daily lives?

------
byoung2
_What’s interesting here is the extent to which the public vastly
overestimates the prosperity of lower-income Americans._

I bet this is due in large part to the availability of credit over the last
few decades. Credit has allowed lower-income people to "play the part" of the
wealthy, giving rise to the distortion. In particular, interest-only, 0% down
mortgages, low or no-interest credit cards, and car leases let someone making
$50,000 a year drive a Mercedes, live in a million-dollar house, and buy fancy
toys like flat-screen TVs and Jet Skis. I think the vast majority of the
public would base their perception of wealth on material possessions such as
cars, houses, and boats rather than the amount of money in savings or
investments. This could explain the discrepancy.

~~~
ctdonath
Most lower-income americans make more than the world median income. Our
"poverty line" is 20x the income line for half the planet.

Of late in Atlanta, one news story about someone unable to pay to heat more
than one room had a dramatic photo of her showing her heating bill in her
living room - with a 55" HDTV and Xbox360 in the same room.

Problem with that chart is scale: while 20% may have most of the money, the
poorest still have enough to live in world-relative luxury.

~~~
michaelchisari
_someone unable to pay to heat more than one room had a dramatic photo of her
showing her heating bill in her living room - with a 55" HDTV and Xbox360 in
the same room._

There's a difference between the ability to purchase one-off consumer goods
and the kind of situation this person is in. Consider that those consumer
goods may have been purchased before an economically catastrophic event such
as an illness or a layoff, or they may have been a gift from someone who is
willing to purchase consumer items, but not willing to provide the household
stability that they require.

Also consider that, second-hand, these items are not particularly expensive,
and even if they were sold, they may only provide a heating bill for a month
or two. Especially in places like Atlanta, which are particularly badly
insulated, and ill-equipped for severe cold.

So what we have is a situation of economic precarity, an instability in which
the existence of consumer good purchases does little to remedy a unstable
situation.

I have a lot of gadgets and toys, but the overall value of them depreciates
daily, and if I lost my employment or well-being tomorrow, they would do
little to stabilize my financial situation, even if I fully liquidated all of
them at a good market rate.

~~~
skorgu
My inner libertarian is unable to comprehend the confusion of ideas that
allows the purchase of a 55" HDTV et cetera without ~six months of rent in the
bank.

My inner liberal fires back with the complete, utter and deplorable lack of
financial education and hence literacy in this country which is at the very
least a partial cause of the most recent subprime financial kablooie.

My inner conspiracy theorist mutters something about that being _awfully_
profitable for those able and willing to profit from said illiteracy.

~~~
krschultz
My dad worked at one company for 28 years. He was fired. He had a year of
emergency money in cash in the bank. Not rent, 12 months of money to cover
every last little expense they had. They should have been set for any
emergency, afterall, who has that much cash in the bank? And no outstanding
car, credit card, or mortgage debt (lived in the same house for over 30 years)

It took him over 18 months to find a job.

Sure, there was a 42" HDTV in their house too. They still weren't spending
money on ANYTHING. And he was working 50+ hours a week trying to find a job.
Their expenses went up a little because he was traveling for interviews and
networking at executive events. (Oh sorry, forgot to mention he was CEO of a
500 person company that was beating its targets even during 2008 when the
stock market dropped like a stone).

So yea, if it can happen to him, it can happen to you. Tell your inner
libertarian 6 months is nothing, and maybe he should find out what this
current economy is really like.

~~~
skorgu
The story in question didn't include anyone losing their job. You're arguing
against a point I have not made.

------
smarterchild
Another way of looking at it: The data is completely overwhelmed by the super
wealthy.

This is the very tail end of Fortune's richest people list.

[http://www.forbes.com/lists/2010/10/billionaires-2010_The-
Wo...](http://www.forbes.com/lists/2010/10/billionaires-2010_The-Worlds-
Billionaires_Rank_41.html)

Any one of those people is worth 1 billion dollars, along with all the Gates's
and Buffett's of the world. If I were pretty well off and worth, say,
$1,000,000, it would take _a thousand of me to equal one of him_. And if I
were a student with just a thousand dollars, it would take one million of me
to get to one of him.

Based on that, the top quintile is not rich because of doctors, executives,
basketball players or lawyers - it's billionaire company founders, investors,
and the like. To test that hypothesis, I tried to find results marked by
percentile, instead of quintile:

<http://www.lcurve.org/WealthDistribution-1998.htm>

The top 0.5% have 25.6% of the wealth and the next 0.5% have 8.4%.

\---

(Side note, if you're thinking about income taxes: I'll bet there are more
than a few people up at the top who get paid a dollar a year in salary.)

------
pg
I wouldn't be surprised if most respondents are answering as if the question
were about income rather than wealth.

~~~
redwood
The other thing is that the bottom folks aren't as "needy" as folks were in,
say, the great depression. \- I.e. "no one starves in america" and most people
know this: so while the distribution in wealth is extreme, the distribution in
QUALITY OF LIFE is less extreme. \- This biases people's view and makes them
feel that generally, for most americans, things are okay.

This is all true of course: except that the worry about an ultra-wealthy
minority is not that their quality of life is too high compared to your's
(it's not) but rather that their POWER is too extreme, since money is power
and speech, and that since power corrupts, they MIGHT ultimately work to
reduce further the strength of the lower classes to the point that poverty
really does become extreme. \- Since as Marx shows this is not really in the
interest of the upper classes (that is: tyranny and extreme poverty are
precisely what leads to a violent reaction by the down-trodden) it may be
that, through the miracle of technology's abundance, we will continue on a
track where we all have a high quality of life, but only a smaller and smaller
pool of people "own" the production engines.

How a world where a few own all the profits, but the masses have what they
need to survive looks, we will soon see: but it certainly feels very Brave New
World and is, perhaps, inevitable.

~~~
javert
_it may be that, through the miracle of technology's abundance, we will
continue on a track where we all have a high quality of life, but only a
smaller and smaller pool of people "own" the production engines._

I think the first part of what you said is right: we will continue on a track
where we all have a high quality of life, absent a paradigm shift in which the
economy crashes like in Weimar Germany.

The second part of what you said -- about ownership of the "engines of
production" -- is straight out of Marxism, which is, by the way, broken. More
and more we live in an information economy; it's not about what you own, but
what you know and what you can make.

That minor nit aside--who cares who owns what, as long as it isn't stolen from
others and as long as quality of life continues to rise for everybody who puts
in their share of effort?

What I mean to say is that the most important thing is that the system be
_fair_ , and let's be honest, fair does not mean an "equal distribution of
wealth."

In fact, it seems pretty clear (especially when "nobody's starving") that what
is fair is letting people earn based on their productive capability and
effort, whether they're Steve Jobs, an average software developer, or someone
with only a high school diploma.

~~~
natrius
We engineers live in an information economy. Many, if not most Americans do
not (pardon my lack of statistics). They work in service jobs that will be
trivially automatable in our lifetimes. Wealthy people will actually own the
means of production in a very meaningful way, and those that aren't equipped
by their genes, upbringing, or education to participate in the information
economy will be unable to earn an income.

Secondly, despite the information economy, it is still very much about what
you own. If you are capable of making something amazing, you still need
savings or investors who will feed and house you while you make those things
and pay the still significant costs of infrastructure that many products
require.

Concentration of wealth matters. That doesn't necessarily mean that government
intervention is a good idea.

~~~
javert
_Many, if not most Americans do not (pardon my lack of statistics). They work
in service jobs that will be trivially automatable in our lifetimes._

Most jobs that truly are "trivially automatable" have already been
automatized. I think it's extremely unlikely that most or nearly most of
Americans' jobs can be replaced by computers in our lifetimes, barring
something like the Singularity happening (which I'm not holding my breath
for).

 _Wealthy people will actually own the means of production in a very
meaningful way_

Like I said, this is a Marxist bromide. Fundamentally, the means of production
is mens' minds. Marx mistakenly believed that production amounted to physical
human labor + expensive heavy-industry capital (like factories), which leaves
work requiring intelligence and skill (MOST work) out of the picture, and is
inaccurate - and is becoming more and more innacurate.

 _those that aren't equipped by their genes, upbringing, or education to
participate in the information economy will be unable to earn an income._

Everyone is equipped to participate, barring exceptionally low IQ. Human
beings are not automatons; they are not determined by the environment or their
parents or their genes; they exercise choice.

 _Secondly, despite the information economy, it is still very much about what
you own. If you are capable of making something amazing, you still need
savings or investors who will feed and house you while you make those things
and pay the still significant costs of infrastructure that many products
require._

Big projects typically require capital investment, but so what? That can be
gotten if you have a good idea. Also, lots of people that work in service jobs
and don't need heavy capital investment do important, creative work. My point
here is that, no, it's not "very much about what you own." Most people in
America are doing just fine, especially those with an education, and most
people in America did not inherit a trust fund or something.

 _Concentration of wealth matters. That doesn't necessarily mean that
government intervention is a good idea._

If it has no implications, then by definition, it doesn't matter. So if you
claim that it matters, you should give an implication.

~~~
natrius
> _"Most jobs that truly are "trivially automatable" have already been
> automatized."_

Food service. Retail. Automobile repair. Lower-end healthcare jobs. Any job
that doesn't require creativity can be automated.

Do you doubt that a McDonalds with zero human employees will exist in our
lifetimes? When farming and transportation are automated as well and Big Macs
are produced with _zero_ human involvement, will you agree that "owning the
means of production" is quite possible?

> _"...which leaves work requiring intelligence and skill (MOST work) out of
> the picture..."_

You are very, very wrong. Here are the 15 most common jobs according to the
Bureau of Labor Statistics: [http://www.huffingtonpost.com/2010/10/06/the-
most-popular-jo...](http://www.huffingtonpost.com/2010/10/06/the-most-popular-
jobs-in-_n_752615.html)

3.2% of Americans work in retail sales alone. Those jobs are going away. I
count two jobs in that list, elementary teachers and general managers, that
will be difficult to automate. What careers do you see this huge group of
people switching to?

Please stop bringing Marx into this. It's basically an ad hominem argument.
You're arguing against him instead of me.

> _"Everyone is equipped to participate, barring exceptionally low IQ."_

This is extremely wishful thinking with no evidence to back it up. The
incentives for training oneself for a job in the information economy is huge
today, yet only half of Americans have completed any college coursework.[1] If
all of the people doing menial tasks today are capable of doing more
intellectual work, why are they ignoring the incentives that exist today to
get them to do so?

> _"Big projects typically require capital investment, but so what? That can
> be gotten if you have a good idea."_

Your arguments are skewed by your familiarity with the software industry. The
businesses normal people start don't get venture capital. They get small
business loans on their personal credit. If you have no credit or bad credit
because you're poor, you'll never start a business. Concentration of wealth
creates more people who are relatively poor.

> _"Most people in America are doing just fine, especially those with an
> education, and most people in America did not inherit a trust fund or
> something."_

I agree. I've been talking about the future, not now.

> _"If it has no implications, then by definition, it doesn't matter. So if
> you claim that it matters, you should give an implication."_

Implications:

1) An almost-permanent upper class.

2) An almost-permanent lower class.

3) (1) and (2) lead to civil unrest.

[1]
[http://en.wikipedia.org/wiki/Educational_attainment_in_the_U...](http://en.wikipedia.org/wiki/Educational_attainment_in_the_United_States)

~~~
krschultz
Actually I worked at a McDonalds in high school, did a lot of research on AI
and robotics in college, and do automation with robotics now for the
biomedical industry.

I've explained it in detail before when someone made your point, but suffice
to say that nobody is going to automate a McDonalds anytime soon.

A robot equal to a human costs $50,000 at least. If you have someone working
for $10 an hour, that is 5,000 hours or 2.5 years payback on the robot. And
the robot is far less flexible (and $50k is a super low number). When you have
3-10 year pay off on a robot, why would you do it?

Robots really aren't built for menial tasks. Where do you see robots in the
auto industry? Painting and welding. Painting is a skill job. Welding is a
skill job. A good painter or welder is not making far off of what an entry
level coder is making (if you don't believe me, find out how much it costs to
weld oil pipeline or ship structure). They didn't take over Detroit to
displace cheap labor, they did it to increase quality. The reasons for
automation are usually increasing quality or doing something humans physically
can't (speed, precision, strength etc). Rarely do you see it worthwhile to
replace a human with a robot for a menial hand task.

So no, McDonalds will not be taken over by robots. The economics of it just
don't make sense.

~~~
natrius
The economics will make sense _in our lifetimes_. For a more concrete value,
let's say 50 years.

Also, McDonalds is open far more than 40 hours a week. It's more like 6am to
1am, seven days a week. That gets paid off in 8.5 months. The real number
would be a little higher than that due to fluctuations in demand throughout
the day that would require extra robots that aren't fully utilized. Even if
you triple the cost of the robot, that still isn't an unreasonable
cost/benefit ratio. Within the next 50 years, it will be a no-brainer.

------
ryanwaggoner
_Poor Americans are simply much, much, much needier than people realize._

You're not _needier_ just because your neighbors are richer than you thought
they were.

~~~
gort
I think the idea is that your neighbours are poorer than you thought they
were.

~~~
clarkm
Poorer relative to the _other_ neighbors, not poorer in absolute terms.

~~~
ryanwaggoner
Exactly, and the term "needier" conveys an extra piece of the puzzle that
these data do not support. Steve Jobs is poorer than Bill Gates by an order of
magnitude, but he's hardly needy.

------
iwwr
Technology allows people to be much more productive than the mean and the
weight of most productivity is naturally skewed toward a small minority.

This is not an injustice. A top programmer will be many times more productive
than an average programmer and large codebases tend to include code from top
programmers preferentially. Not only that, the value generated by top
programmers (or project leader) is vastly more than that of an average
programmer. This is why Google is paying their top people (technical,
administrative) millions of dollars.

Compare that to a stone age hunter, who may have been 2-3 times more effective
than an average hunter. A strong or a fast man is never much stronger or
faster than an average man.

~~~
jonhendry
"This is not an injustice."

Paris Hilton. Among other examples. Yes, there are people who get large
paydays because they are strikingly effective at what they do. Then there are
the people who get large paydays for no particular reason. Or because of their
parentage.

Before celebrating the übermensch, please try checking back in with reality.

~~~
natrius
Sorry, Paris Hilton being rich is not an injustice. She's rich because people
(particularly her parents) wanted to give her money. Trying to prevent that
sounds like an injustice to me.

------
martythemaniak
Facts play a depressingly small part in politics and (perhaps even more
depressingly so), studies/surveys and casual observations show that pointing
out various facts to people does not actually change their opinions. Try
talking about income inequality to a Tea Partier and you'll get the same
reaction that an evangelical christian has to evolution. Moreover, this is
certainly not an American phenomenon - I see it US politics, Canadian
politics, and if I paid enough attention, I'd show up in European and other
politics as well.

~~~
jacoblyles
Tea Party supporter here - and I am quite aware of the facts regarding income
distribution in this country. Are you saying that people can't disagree on the
proper level of income redistribution for a society if they are all aware of
the current distribution of income? That's a mighty strange assertion.

~~~
jlangenauer
Downvoted by accident (damned iPhone), but I think this is a reasonable
question.

------
jasonkester
I'd like to see that graph broken down between people who think that wealth is
a zero sum thing that can be represented as a pie (as shown) vs those who know
it isn't.

That is, people who think that if I have a dollar, then they can't also have
that same dollar at the same time.

~~~
Khroma
I remember this from Hackers and Painters.

Money is a zero-sum game, wealth is not. So yes, I can't have the same dollar
that you have.

~~~
jasonkester
I get a dollar, put it in the bank, which lends it to your company, which pays
it to you.

It's sitting there on both your and my bank statement. We both have it at the
same time.

~~~
abalashov
Well, minus reserve requirements. :-)

------
nhangen
I think the headline is misleading, if not a flat out lie. Americans know who
has money...almost everyone else. The average American is living paycheck to
paycheck, or worse...they know that their friends are living in the same
situation. We know that people like Bill Gates, Warren Buffet, and future Mark
Zuckerbergs hold billions.

I don't really know anyone that is confused or surprised when they hear that
this is how the country's wealth is distributed.

~~~
wladimir
Indeed. The USA has a huge divide between poor and rich for a developed
country. Their poor can hardly come by, their healthcare system is a mess, and
even basic infrastructure is underdeveloped in a lot of areas.

And the funny thing is, even though many people agree with that, everyone is
coming up with excuses. No one is addressing the problem on how to narrow the
poor-rich divide instead of further widen it in any meaningful way. They all
are caught up in discussions about details such as 'should we increase tax
this year' which will probably have zero influence in the big picture.

But the most disgusting thing to me is that they are still trying to push
their system of corporate plutocracy on the rest of the world, as if it is the
best thing since sliced bread.

------
joshes
No matter the intent or implications of the post or the poll, the fact remains
that _20% of the people control 85% of the wealth_. This seems horribly
lopsided to me.

Plutocracy seems to be an apt description.

~~~
TGJ
How is it lopsided? If you look at 10 of your friends, is everyone one of them
extremely well off? Is everyone of them extremely talented? There is no
getting around the fact that there are gifted people and not so gifted people.
To say that it is lopsided would almost imply that everyone deserves equal
shares.

20% seems about right. 20% of the people are entrepreneurs and are smart,
gifted, talented people that employ the rest of the country to achieve their
dreams.

~~~
vacri
Ah, the good ol' "if you're poor it must be your fault" reasoning, wearing yet
another dress today.

~~~
m_myers
More like "if you _stay_ poor it's probably your fault".

~~~
OpieCunningham
That assumes equality of opportunity, which doesn't exist.

------
SandB0x
Here's the original paper (featuring Comic Sans):

[http://www.people.hbs.edu/mnorton/norton%20ariely%20in%20pre...](http://www.people.hbs.edu/mnorton/norton%20ariely%20in%20press.pdf)

Note that the survey was carried out five years ago, before the financial
crisis.

------
WalterBright
The article confuses wealth with income. You can have a very high income, live
high on the hog, and have zero wealth. Likewise, you can have a lot of wealth
and zero income.

------
canterburry
I can't help but to always sense and underlying message of "are the rich too
rich?" whenever a story like this gets published.

Rather than just looking at the raw numbers (which these articles always love
to do), I think the more relevant questions is, do or don't the "rich" deserve
their wealth? If they deserve 85% of all wealth due to their involved in the
economy, job creation etc...well, then they should have it.

I think few here in the HN community would argue against some entrepreneurial
fellow HNer making a buzzillion dollars off of some cool and desirable
product/service which instantaneously puts then into the 1st 20th percentile
of the graph. Why? Because this person created enough value to earn that
money....and maybe those other Americans in that top percentile did too.

------
code_duck
Another way that Americans are quite misinformed about who has money is that
the media portrays Hollywood stars as the most wealthy people in the world. A
relatively minor point, but it does serve to cover up the people who truly
have a lot more wealth and power than someone who makes a 'mere' $25m per
movie.

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MikeCapone
I'd like to see the same graph for productivity/wealth creation...

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pedanticfreak
I'm not sure Americans are misinformed, per se, but instead I'd sooner say
human beings exhibit an equality bias. For example, if you gave a person a
choice of two mutual funds, a low risk and a high risk, most people would put
50% in one and 50% in the other regardless of the actual distribution of risk
over the two funds.

So if you gave the average person 5 groups of people and told them to ideally
distribute the wealth between them, they would probably exhibit this same
equality bias on average.

As for the estimated case, I'm sure you'd get similarly wrong responses asking
the average person basic questions about U.S. history. Or algebra, chemistry,
or pretty much any other academic subject.

EDIT: Dan Ariely and others frequently cite this kind of bias in the books and
talks I've seen. I wonder what Dan would have to say about that considering he
collaborated on this paper.

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lotusleaf1987
Some of these comments are so bizarrely disconnected from reality trying to
talk about how money isn't zero sum, but seriously when the top 20% of the
population has 85% wealth there is something fundamentally and critically
wrong.

~~~
mbesto
And so what do you define as being "right"?

(playing Devil's Advocate here btw)

~~~
lotusleaf1987
It just strikes me that our system of monetary reward/punishment is
fundamentally out of balance when the top 20% have 85% of the wealth/resources
and the bottom 80% are left to fight over 15%. That is a banana republic. This
is why revolutions occur.

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bluedanieru
We really only needed the first half of this title.

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Ryan-R
2th, 'nuf said. But, in all seriousness, mistakes like that make these
articles lose all credibility. (notice ant the top of the graphic, "-Top 20%
-2th 20%...")

