
Why America Is the World’s First Poor Rich Country - monsieurpng
https://eand.co/why-america-is-the-worlds-first-poor-rich-country-17f5a80e444a
======
avgDev
I think this is pretty spot on. I recently visited Poland where i was born and
raised for 14 years of my life. I know many people who came to US for work but
have left. They earned more but spent more and did not feel good about their
shitty low wage jobs.

I think life is relatively good for tech people, and business people in high
positions.

There was a point in my life when I used foodstamps and medicaid. I suffered a
serious allergic reaction to a medication which caused permanent damage to my
neurological system and tendons. I ruined my credit due to the high cost of
healthcare. However, I became really passionate about tech, now bought a house
and rebuilt my credit. I still suffer from chronic pain but I manage it quite
well and you would not be able to tell something is off.

The US healthcare caused massive mental issues and suicidal thoughts. First I
lost my job, then I lost my insurance....it was scary. Then, ACA passed and I
was covered under medicaid. Seriously, if it wasn't for ACA I dont think I
would continue my existence.

I am back in work force making good money and am pretty happy.

This article is really interesting, I feel as US has failed its citizens.
Legislation is driven by lobbying. Seems like nobody cares about science and
facts anymore in politics. I wonder if some of this is caused by massive data
collection and gearing speeches towards things people want.

Same thing happened to many news article, some dude looked at data said "these
sensational titles/articles drive traffic", which drives revenue, WE NEED
MORE. That's why CNN interviewed a dude that got sued by their parents because
he would not move out at 31......

I love US and most people are great. I hope we can turn things around. I think
politicians should be educated, smart people that work towards a greater good
of a society.

~~~
TangoTrotFox
_' My fellow Americans, ask not what your country can do for you — ask what
you can do for your country.'_ That's undoubtedly one of JFK's most famous
quotes. It's interesting to think how much things have changed since then.
Imagine if a politician, let alone a democratic one, said that. The response
would be... less than positive.

So what's changed? One thing that I think is easy to pinpoint is that we've
turned sharply against nationalism for various reasons. But then a simple
question. If we're to believe that devotion to the American culture and
interests is bad, what is supposed to make people in this enormous nation of
325 million care for one another? Right, we can say we -as humans- ought care
for one another naturally and unconditionally. And lots of people say they
care about e.g. what's happening in places outside of this country (Africa as
a typical example). The median energy/income put towards doing anything about
those situations, even just among those who claim to care? Absolutely 0.

In the heyday of America when there was a much stronger sense of connection
between employer, employee, and generally people at large. Rich or poor, urban
or rural, politician or voter, liberal or conservative - you were a fellow
American. For instance the last time that a basic income in the US was
mentioned actually came from a republican - Richard Nixon. That's not to say
that I think it is/was a great idea, but rather that this deterioration of
concern in society is a very new phenomena. Now we live in a society when a
person goes to a congressional ballgame to try to kill as many congressmen as
he can - many people were, shall we say, less than upset about his actions.
There's certainly a chicken and egg question there, but the tautology needs to
said: when people could not care less about one another (if they don't fit
into their ingroup), it should come as no surprise when people could not care
less about one another (if they don't fit into their ingroup).

------
kinsomo
I liked his idea that the common American is stuck at the loser-end of a
system of "asymmetric risk." Americans are expected to take on more and more
"personal responsibility" (i.e. risk) for healthcare, for securing income,
etc. and that means they're _subject to all the consequences of any failure_.

On the other hand the powerful and wealthy monopolize the rewards of risk, and
broadly refuse to share it. However, they have such large cushion (and
connections) that they _never really took any personal risks at all_. If they
fail, they'll probably be fine (except maybe with some hurt feelings).

~~~
Chyzwar
There are other factors. The US is a big sparsely populated country that is
relatively far from business partners. Military dominance is required to
continue a current foreign relationship and protect global corporations
originated in the US.

Even Obama manage to only make a tiny turn to the left. The US is like
Titanic, too big to make drastic turns and cannot afford to slow down. Larger
geopolitical plays influence US more than social rich vs poor.

Look how China outmaneuver the US with peaceful foreign policy making military
complex useless. Free trade that allowed to move/outsource low-value
manufacturing now is turned against the US when technology advantage is
shrinking.

------
weeksie
While this is a bit breathless, I think it does call out the fact that
American poor are much worse off than those in a typical rich country. Since
the 80s the upper middle class has grown quite a bit while the working class
and poor have lost ground. Still, the typical poor in America are far, far
from the poor in a developing nation. The homeless (~500k out of 325mm) are
pretty close though.

The poverty rate has remained quite steady in the US, so despite the "feel" of
there being more poor in the country that doesn't square with the facts [0].

The real issue which the article does a great job of calling out is the way
that Americans pay a premium for many goods; it just doesn't connect that
thought to anything illuminating.

[0]
[https://www.washingtonpost.com/news/wonk/wp/2012/07/11/pover...](https://www.washingtonpost.com/news/wonk/wp/2012/07/11/poverty-
in-the-50-years-since-the-other-america-in-five-charts/)

~~~
newnewpdro
Population growth necessitates a proportional _drop_ in poverty rate just for
things to stay the same.

Looking at poverty through a lens which normalizes for population growth
paints a completely different picture from what one will see in real life on
the streets. When the rate stays constant and the population grows, the
situation on the ground is worse, period.

~~~
weeksie
No. The poverty _rate_ declined since 1960 and has held steady since. That is
a per capita measure and scales with population growth.

~~~
newnewpdro
That's the whole point - using a per capita measure is inappropriate.

~~~
weeksie
Ah I did misread your comment. That said, I have no idea why that would be
inappropriate. Can you go into more detail because I must have missed your
point. For instance, how are you judging the situation on the ground? From any
objective measure a per capita decrease seems to be a win.

~~~
newnewpdro
When you're walking through the streets of your city, it's not important to
you that the homeless people you see are some specific %age of the population
over the last dozen years.

You care that the absolute number is equal to or less than the previous years.

The whole point of a per capita rate is to eliminate the effects of growth.
While that is useful for measuring certain things, it's not really appropriate
for things like poverty and crime.

The fact of the matter is it's damn near impossible to keep up with
exponential growth without _substantial_ effort to prevent bad outcomes for
the added people. That starts looking like socialism, and this is USA, so good
luck with that.

So instead we'll just look at per capita rates going down slightly, feel good
about ourselves, and ignore the mess in the streets.

The good news is fertility rates are declining, if that trend continues maybe
we can sort this out over the next 100+ years.

~~~
weeksie
Okay, I understand your argument but that's not at all how that works. Framing
poverty in absolute numbers creates an impossible slope to climb. Sure, it
would be fantastic if we could reliably shoot for reducing the amount of
poverty in absolute terms and that is (sort of) the goal anyway. HOWEVER,
absolute terms are meaningless for measuring population effects.

Also exponential growth is keeping poverty _down_. Growth creates mobility
because without growth economics becomes a zero sum game and NOBODY wants to
live in that environment. You think the 70s were violent, well. . . .

As for fertility rates, that's also not how that works. Lower fertility rates
mean fewer working age people to provide a tax base. That's why countries who
have low birthrates are all encouraging immigration. Japan, for instance, with
its low birthrate now has more immigrants than it has ever taken on.

In any case I think we have an epistemological disagreement and I don't expect
to convince you, just to explain my thinking. Thanks for taking the time to
explain your argument, and even though I disagree I appreciate it.

~~~
newnewpdro
Much of what you point out as benefits of growth aren't necessarily the way it
has to be. We have a deeply rooted system built entirely around a growth
model, and growth will inevitably have to cease since it's inherently
unsustainable. Everything will need to adapt to that situation, and much of
your assumptions will necessarily no longer be true for the nation to
function. I don't know what that will look like, but we _must_ adapt to a
world without growth, the sooner the better, for everyone in the long-term.

I already stated that it's impossible to keep up with the population growth.
This is precisely why I feel it's important to clearly state the figures in
terms that really reflect what's seen by individuals walking through our city
streets. I don't have the impression that the average person actually groks
this coupling, and it's articles like those portraying such things in per
capita figures which helps reinforce the illusion things are improving while
they're actually deteriorating.

~~~
tech4all
This is, perhaps, one of the most civilized and enlightened on-line
discussions I have ever witnessed. Newnewpdro and weeksie I commend you both.

------
ovulator
I didn't make it past his first "fact" that most American's can't afford to
scrape together $500.

His source is a Google search, that search's first result is a CBS article,
that article's source is a Bankrate.com survey.

That survey[1] asked how someone would pay for an unexpected emergency, in
which that % responded "from savings" The other options on the survey were
"use a credit card", "borrow from friends/family" & "reduce spending". So this
obviously doesn't mean they don't have the money, it simply shows how they
would pay for it. As I would use a credit card to pay for an unexpected
expense 100% of the time, but that doesn't mean I don't have the means to pay
for the expense.

[1][https://www.bankrate.com/banking/savings/survey-how-
american...](https://www.bankrate.com/banking/savings/survey-how-americans-
contend-with-unexpected-expenses/)

~~~
shalmanese
If you want a more reliable cite, the Federal Reserve has studied this problem
as well:
[https://www.federalreserve.gov/publications/files/2017-repor...](https://www.federalreserve.gov/publications/files/2017-report-
economic-well-being-us-households-201805.pdf)

"Four in 10 adults, if faced with an unexpected expense of $400, would either
not be able to cover it or would cover it by selling something or borrowing
money. This is an improvement from half of adults in 2013 being ill-prepared
for such an expense."

------
maym86
The amount of poverty I saw in the States after coming from the UK was
shocking to me. So much money in the country but for people at the bottom it
was visibly worse with much more homelessness and visible health problems.

~~~
oh_sigh
Where did you travel in the states?

~~~
Maarten88
I had the same experience, I was mostly in big, rich cities like NY, SF, LA,
Seattle. From other travelers I heard when you travel deep into South Central
US, you can find full-on third world scenery.

It is shocking how many poor people are begging on the streets, in a country
that is, on average, richer than where I live.

~~~
dustincoates
> From other travelers I heard when you travel deep into South Central US, you
> can find full-on third world scenery.

Respectfully, the people who told you this were either vastly exaggerating or
had zero sense of perspective. You're not finding houses in "South Central US"
(not sure exactly what that refers to anyway) without running water or dirt
floors. I actually grew up in the small town South and knew plenty of people
who commuted into town from the country. Some were poor, sure, but "full-on
third world scenery." Come on...

~~~
ravitation
Well, unfortunately, having running water and having drinkable running water
are not synonymous in the United States.

Also, third world countries are not just countries without running water and
dirt floors...

~~~
IOT_Apprentice
First world was non-communist NATO aligned countries. Communist countries were
2nd world, non-aligned with either were 3rd world. That said, American having
protectorates where citizens don't have power, drinkable running water or
cities where there is no drinkable running water are poor examples for a
nation with such resources as the US.

~~~
ravitation
I know the etymology of _third world_ , but it's meaning has also changed
significantly since the end of the Cold War...

I was referring specifically to American cities (cities in America, not
American "protectorates") that don't have drinkable running water...

------
pasbesoin
Years ago, I saw/read a presentation from a prominent economist arguing that,
more than financial resources, people should look at the changing distribution
of _risk_ in the U.S.

So, I started doing so. And so far, it has corresponded pretty well with other
circumstances I've been observing.

There's been an enormous shift of risk from institutions to individuals. This
economist argued for it accelerating in the 1970's and continuing since.

Sometimes, simplistic phrases are nonetheless useful -- sometimes even
defining, if devoid of the details.

Divide and conquer. I think of that often, with regard to present
circumstances in the U.S.

Just lately, I ran across a "random" article on social media. About a
relatively little known Nobel laureate who has apparently significantly
informed -- or, provided cover for -- the very self-centered and transactional
philosophy and behavior of oligarchs and monopolists like the Koch brothers.

I had to leave off reading it about halfway through, with the intention to
return. And, it mentions an apparently well-received book on the topic.

I'm not familiar with this web site, but here's that article's URL:

[https://www.ineteconomics.org/perspectives/blog/meet-the-
eco...](https://www.ineteconomics.org/perspectives/blog/meet-the-economist-
behind-the-one-percents-stealth-takeover-of-america)

------
volgo
Quality of life is not just about amount of money you earn. It's about your
status in society.

You can make a ton of money feel low status (ex. oppressed minorities) and
your life wouldn't be very good

You can make very little money and feel very high status (ex. a village elder)
and your life would be amazing.

In America, the upper class have a ton of money and medium status - the poor
hates them and it's generally considered impolite to show off your wealth.

The lower class have no money and no status.

No one really feels that secure

------
eddieplan9
Take this piece with a huge grain of salt because it misquotes to exaggerate.

The second statement - "A third of Americans can’t afford food, shelter, and
healthcare" \- is based on a CFPB survey [1] that scores "how people in the
U.S. _feel_ about their financial well-being". The survey finds that a third
of Americans, experience "running out, or _worrying about running out_ , of
food, not being able to afford medical treatment or a place to live, or having
utilities turned off". It's not hard to find enough people who are _worrying
about_ not being to afford medical treatment.

The third statement - "Healthcare for a family now costs $28k " \- is a
misquote. The original report [2] states that "the cost of healthcare for a
typical American family of four covered by an average employer-sponsored
preferred provider organization (PPO) plan is $28,166". The same report lists
that employee contribution is $7,674, and employee out-of-pocket is $4,704. If
you want to include the full premium as "cost", then you also need to adjust
the median household income to include employee contribution and all sorts of
non-wage benefits.

[1]
[https://files.consumerfinance.gov/f/documents/201709_cfpb_fi...](https://files.consumerfinance.gov/f/documents/201709_cfpb_financial-
well-being-in-America.pdf)

[2]
[http://us.milliman.com/uploadedFiles/insight/Periodicals/mmi...](http://us.milliman.com/uploadedFiles/insight/Periodicals/mmi/2018-milliman-
medical-index.pdf)

~~~
donald123
1\. Have you actually read the survey you referenced? It is not just finding
random people on the street, it's using "GfK Knowledge Panel® (GfK panel), a
recruited internet panel designed to be nationally representative of U.S.
households.". You need better argument or evidence to dismiss the survey.

2\. The point of the quote is to prove high cost of healthcare overall to the
society, not just the employee. In employer's perspective, insurance premium
is considered cost of the employee, which has impacts on the employees' wages.
So although the statement may not be precise, the point is not wrong.

~~~
eddieplan9
1\. I have. My main point is that the survey is about how people _feel_ about
their finance, not actual financial reality as in "one-third _cannot afford_
food, shelter, and healthcare". The survey itself actually says

> roughly one-third of individuals have difficulty making ends meet and
> approximately one out of five sometimes have difficulty paying for basic
> needs like food, housing, and medical care.

So even taking it at face value, the ratio is 1/5 instead of 1/3? And also

> while financial circumstances are highly correlated with financial well-
> being scores, individuals with quite different experiences can arrive at the
> same score

This further indicates the survey is about people's perception about personal
finance, not objective financial reality.

2\. IMHO, the author's point is not really "US spends a lot on healthcare as a
country", but that US is a "rich" country but people are "poor" because they
have little dispensable income after paying for healthcare etc. Comparing
total insurance premium against household income is a faulty way to support
that point. I agree US spends a lot on healthcare, but it's not bad enough to
justify labeling US people as "poor".

------
oh_sigh
Besides for a few facts thrown around in the beginning, this is entirely an
opinion piece. Even the facts in the beginning are presented in a misleading
manner IMHO:

> The average American can’t scrape together $500 for an emergency. A third of
> Americans can’t afford food, shelter, and healthcare. Healthcare for a
> family now costs $28k — about half of median income, which is $60k.

The "source" in the first statement links to a google search for "american 500
emergency". Not a compelling source IMHO.

The source for the second statement seems to be legitimate, but the author
claims that 'a third of Americans __can 't __afford food, shelter, and
healthcare ', when in fact the source only claims that a third of americans
__may struggle __to afford those things. There is a difference.

The final statement is conflating employer-paid healthcare costs with median
income, as if that $28k is coming out of the $60k - when it is not - most of
it is being paid by an employer.

And then the rest of the article is an opinion piece full of assertions and
little evidence. Pretty low quality article for HN in my opinion.

~~~
thiagocsf
I don’t think it matter that the 28k are paid by the employer and not from the
60k salary. Perhaps this person could be making 88k instead?

Also, while you’re inbetween jobs, health care still costs 28k.

~~~
oh_sigh
I agree. My point is that it is a misleading juxtaposition. I think most
people who read that sentence would parse it as something like Americans
income is 60k, and then after they pay for healthcare they have 32k or less
left

~~~
arcticbull
It's really hard to make a direct comparison as in countries with socialized
medicine, you don't really have co-pays, deductibles, caps, out-of-pocket
maximums, etc. The implicit assumption you make is also that the average
American gets their insurance through their employer -- they do, but that's
not the whole picture.

55.7% of Americans get cover from employers, 16.2% from individual markets,
19.4% from Medicaid and 16.7% from Medicare. [1]

After all, if people can't come up with $500 for emergencies, what's the
chance they can come up with co-pays? This is measured in [2] and they
conclude 41,000,000 Americans are underinsured.

So they may not have 32K left, but they probably do have less than 60K left.
In fact I'd imagine that the 55.7% who have employer-paid coverage probably
make way more than the 44.3% who do not.

[1]
[https://en.wikipedia.org/wiki/Health_insurance_coverage_in_t...](https://en.wikipedia.org/wiki/Health_insurance_coverage_in_the_United_States)

[2]
[http://www.commonwealthfund.org/~/media/files/publications/i...](http://www.commonwealthfund.org/~/media/files/publications/issue-
brief/2017/oct/collins_underinsured_biennial_ib.pdf)

------
ciconia
I find the article quite a bit hyperbolic, but it still rings true. Technology
is a double-edged sword, and America's obsession with it is wreaking havoc.
The more you use it, the more you depend on it. and the more people spend time
tapping virtual buttons on touch screens, the more they become removed from
the "basics of life", separated from physical existence by more and more
layers of "abstraction" \- in more than one sense.

It does seem like lots of people today don't know how to care of themselves in
the most basic way - cook healthy food, grow some vegetables, do laundry or
wash dishes by hand, prepare a grandma medicine for one's children when they
have a fever... Instead they automatically reach for their credit card and
make a purchase.

No wonder everything is so expensive when you depend on "services" for every
little necessity of life.

------
jorblumesea
In other countries, the government (and the wealthy) subsidize services used
by all to a much greater extent and are considered "public industries". In
America, everyone is much more on their own and industries like healthcare are
expected to turn a profit.

Should people like Martin Shkreli have control over medicines? Most in the
world would say no, in America it's yes.

That's the difference. The American people are treated as a cash cow and
industries that they use are businesses without any expectation of
contributing to the public good. So while we are rich, we are nickle and dimed
for everything from healthcare to education.

------
tolger
That was definitely worth reading. I feel the crunch as a software engineer. I
am still able to max my 401k, but after taxes, insurance premiums, mortgage,
and a few nights out with the wife, I have little, if any, to invest.

I feel like I should be saving more, but somehow the cost of living is rising
while our incomes are staying flat.

------
mnm1
Nothing in this article should be a surprise to anyone who has been following
what's been happening in America lately or to anyone who understands its
history. America has throughout its history developed extreme systems of
oppression, subjugation, and poverty to control its people and in attempts to
control other nations. The main difference between the current implementation
described in the article and previous implementations is that it's less
focused on race. In the true spirit of progressiveness, the current
implementation tries to fuck over everyone, not just minorities, in an effort
to update the systems of old. It is a new type of poverty to exist, but not a
novel one. It's one that was available to all other developed countries, one
that every single one of those countries _explicitly_ rejected. I think
analyzing why all other developed, rich countries of the world blatantly
rejected this system while the US supported and supports it to the extreme
would be a fascinating study.

------
xupybd
"It’s extreme capitalism meets Social Darwinism by way of rugged self-reliance
crossed with puritanical cruelty."

I don't know if this is true. There seems to be something else emerging in
America.A failed attempt at socialising thing one making the situation worse.
Yes medical costs have sky rocketed due in part to an attempt to give
universal health care.

They are accused of extreme capitalism but bail out large corporations and
subsidise the growing of corn.

Things seem pretty bad over there but I don't think think they have a well
regulated free market, they have something else.

The article accurately pointed out the asymmetric risk. A society cannot
function with everyone living on the knife edge like that. The only insulation
seems to be extreme wealth. But I don't know that socialism will fix this.

------
trevyn
This article is completely ignorant of history. Massive numbers of people have
lived in dismal conditions since the beginning of humanity, in regions that
would be considered rich in their time.

~~~
hsitz
>This article is completely ignorant of history. . .

It doesn't sound like you actually read the article. Whether people have lived
like that in former eras is irrelevant. The article talks about the U.S. in
comparison with other rich democracies, and argues that the U.S. is "poor" (a
"poor rich country") in a way we haven't seen before.

The article also argues that the poverty in the U.S. is likely to give rise to
authoritarianism and extremism, which are less likely to occur in a better
balanced society.

~~~
trevyn
Ok, then it is an inaccurately titled article. :-)

~~~
arcticbull
Just read it. I'm curious what your thoughts are after you do, and how that
compares to your initial reaction.

~~~
trevyn
It is filled with factual errors, unsupported assertions, and appeals to
emotion. The rest of the site appears to be of similarly poor journalistic
quality. Looking at the author's Amazon author description page, I judge that
he is attempting to make a career of telling a certain segment of the
population what they want to hear, and leveraging that echo-chamber passion to
sell books, get speaking gigs, and the like.

~~~
mbrodersen
What "factual errors"? On what basis is the site "of similarly poor
journalistic quality"? Why do you attack the author instead of arguing facts?

~~~
trevyn
I was asked for my thoughts, not an argument intended to convince anyone, so
that’s what I gave. :)

There are several other comments on this page that go into some of the factual
errors.

I reviewed the titles and posting frequency of recent articles on the site,
and it strongly pattern-matched in my brain as “content farm”, which would be
negatively corrated with article quality. I predict the author’s intention is
to post one article a day, and I predict that having such a posting frequency
as a primary motivation is negatively correlated with quality.

I examined the author’s previous work in an attempt to understand his
motivation behind writing and posting such an article; I’ve noticed that
articles written out of a personal desire to communicate an idea tend to be
better constructed or have a different “voice” than this article, so I wanted
to understand where the author was coming from in the larger context. I only
“attacked” because of the strength of the pattern-match I found.

~~~
IOT_Apprentice
So your comments appear to be more about medium as a content farm, and less so
about the ideas within the article itself.

------
oprah2018
There is another way to look at this. In the current economy, anyone who wants
to can get IT and programming skills and get a pretty good job. In fact, IT in
general is a pathway to wealth, which is open to anyone, and leads to more
wealth than many other career paths. You can be a 17 year old Javascript
expert a get a $200k job without going to college. All the training materials
you need to do this are online, for free. You need a $200 Chromebook, a Wifi
connection, and some kind of ambition or drive.

~~~
lightbyte
>You can be a 17 year old Javascript expert a get a $200k job without going to
college.

Please elaborate on what companies hire 17 year "javascript experts with no
degree" starting at 200k

~~~
phil21
Yeah, not any more. Maybe in 1999 you could come in as a high school dropout
and make an easy six figures since you truly _were_ better at this "internet
stuff" than the vast majority of the older IT folks.

I doubt we're in for another massive technology shift like that though in our
lifetimes where toys turn into business tools exceedingly rapidly. AI is about
the only one I could think of, and the barrier of entry there is _far_ higher
than the $150k/yr 17 year old webdev job of olde.

They were outliers, but they certainly existed within my friends group. Those
that built independent websites/marketing/etc. did even better, and built
rather good careers out of them over time. Many are now retired or semi-
retired in their 30's.

Those doors have since been firmly slammed shut though by those who came
afterwards, now you are gated by the HR dragons from most jobs.

It was a unique point in tech history I doubt will be re-created, but it's
easy for those who lived it to think things are still like that. I got lucky
to experience that and "come up" at the right time being interested in the
right things. Today I'd have zero chances being unable to afford college. The
competition is much more fierce as well.

