
In 5 states, richest Americans live in a “new Gilded Age” - hellofunk
https://www.cbsnews.com/news/in-5-states-richest-americans-live-in-a-new-gilded-age/
======
padobson
_Even as the gap between the rich and everyone else widens, the quality of
life for the bottom 99 percent has vastly changed since 1928._

This makes me wonder how much people care. In a global economy where the 1%
are investing in markets that can reach billions of people, extreme poverty on
a global scale was sliced in half in a 30 year period, and supply chains allow
us to have super computers and unlimited entertainment for tiny fractions of
the median wage, you can expect a lot of inequality, but life is way better
for _everyone in the world_ since 1928.

Inequality is only a problem in so much that it leads to higher crime rates
and (eventually) civil instability in places where its most apparent. We
haven't seen much of that (yet), but don't stop looking for it.

~~~
CompelTechnic
If you want to understand wage stagnation in the US, look up the "elephant
curve." In a nutshell: middle income of rich countries has stagnated because
of the new need to compete with rapidly industrializing poor countries.
Everyone's income around the globe tends to increase during this process (a
very good thing!), except for middle wage earners in rich countries.

Meanwhile, in local politics, both sides of the aisle blame eachother for this
effect, which is totally outside of either of their control.

~~~
glaugh
I find the elephant curve explanation compelling. But I’m not sure it’s fair
to then say there’s nothing that can be done to mitigate the impact of that.

Rich Scandinavian countries, for example, have a more redistributive tax
system that appears to leave people broadly happier. Fine to argue the
relative merits of such an intervention, of course, but worth noting it’s very
much an option.

~~~
kryogen1c
Not really an option. The largest scandanavian country, sweden, is a little
larger than Los Angeles and the rest are much smaller. They have little
emigration and immigration, and although their gdp per capita is similar, the
huge population difference means their economies/gdp are of a totally
different scale.

Apples to oranges.

~~~
mr_overalls
Your rationale for the Nordic model being inapplicable to the US is a common
one among conservatives, but it baffles me.

Of course the Nordics are smaller than the US, but all of the economic
variables in question should scale on a per-capita basis. Specifically, what
is it about a population difference that makes a strong safety net
inapplicable?

~~~
klipt
"America is bigger than X" is a thought terminating cliche to make people stop
asking awkward questions like "why is quality of life better in X?"

Except it's baloney, the EU even has a bigger population than the US and has
universal healthcare, public transit, etc.

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metalliqaz
History rhymes.

Of course, this time the robber barons know what will happen if they delve too
greedily and too deep. Unions, the New Deal... can't have that. This time they
are making more clever investments in propaganda, government control, and
distraction.

~~~
rapnie
..and supported by the latest tech to make that all much easier :)

~~~
metalliqaz
tech is just tech, used as a tool by both the forces of good and of evil

~~~
tntn
This is a BS cop out to avoid having to think about ethics.

Some tech is inherently good or bad. If you create platforms that spread
misinformation and rage much more effectively than information and reason, you
shouldn't be able to walk away saying "it's a neutral tool!"

~~~
malvosenior
> Some tech is inherently good or bad.

Not true. You might see a platform "spreading rage" as bad but to the people
on the platform it's giving them a way to fight injustice (hence the rage --
what are they angry about).

Tech connects people. _You_ may not agree with those people but they'll be
glad to have the platform.

------
r_singh
Not surprisingly, there's 5 places in California where the top 1% has more
wealth than in 1928. Which means that the ratio of income of top 1% to income
of bottom 99% is higher than it was in 1928. Which is a sign of rise in income
inequality.

I would be really interested in studying the breakdown of wealth within the
top 1% in all the places listed. In my experience (here in India at least),
most people in the top 1% are just as worried [about income inequality] as the
rest of us. It's the people at the top 20% of the 1% that can live anywhere,
but sure, journalists can still call them the 1%.

~~~
sbjs
I’ve always wondered, where did California’s wealth originally come from? Was
it the gold rush that started it all?

~~~
kaycebasques
The Gold Rush did indeed make a lot of people wealthy. Not the gold itself,
but rather land speculation and the business bubble.

When I randomly recall old wealth families that I’m aware of, they pretty much
all started from local business tycoons (newspapers, railroads, essential
consumer products, etc.) that usually diversified through real estate. No
different than the rest of the US.

~~~
r_singh
and no different from a lot of the rest of the world

------
dagaci
Just to give unspoken point of view, a scenario which i would like to pose:
That Income inequality provides a kind of fiscal stability vs uncontrollable
inflation.

If you overlay a chart of inflation on top of the chart of inequality you will
find that maximum equality appears to correspond closely to periods of maximum
inflation.

Governments from both sides of the argument have focused on reducing
collective bargaining and on ensuring that efforts to rejuvenate economies,
like quantitative easing via the financial sector and tax breaks are focused
on the corporations and wealthy precisely because of the low impact this can
have on inflation

The effect of these measures tends to pump money into the already wealthy
while bulk of the population experience no-change.

~~~
Spooky23
Inflation isn't all bad.

The lack of inflation is making it easy to concentrate and safely hoard cash,
which is cutting off the oxygen for everyone else. We've had 30 years of an
ultra-safe, guaranteed strategy to make money -- move all value-added services
to places with cheap labor and cheap money and export cash, facilitated by
tithing a good portion of GDP to the OPEC producers. It's destroying western
society.

The best thing that could happen to the west today would be a devaluation.

~~~
Pulcinella
Yeah inflation can be good if you have debt.

------
kaycebasques
This article’s chronology is off a bit. It compares current income inequality
to 1928. But 1928 was not part of the Gilded Age. 1870-1900 is usually the
period known as the Gilded Age.

Aside from that anachronism, I used the exact same term to describe where
we’re at just a few weeks ago.

~~~
moate
Yes, and it's too bad because the irony of pointing out that the 20's were
part of the so-called "Progressive Era" despite having robber barons and such
horrible inequity is really too good IMO.

------
Brass
Actual study: [https://www.epi.org/publication/the-new-gilded-age-income-
in...](https://www.epi.org/publication/the-new-gilded-age-income-inequality-
in-the-u-s-by-state-metropolitan-area-and-county/)

------
xamuel
For those who just want the list (which is buried annoyingly deep):

* New York

* Florida

* Connecticut

* Nevada

* Wyoming

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stvswn
The Gilded Age refers to the last several decades of the 19th century, and yet
the article compares today's data to 1928. That would be "the Roaring
Twenties."

~~~
frockington
Misusing the term Gilded Age is becoming more prevalent recently within the
inequality narrative. I'm guessing The Gilded Age was shown to produce more
clicks and why let facts get in the way of clicks

~~~
jimbofisher1
Yeah bro Buzzfeed is totally doing AB tests on Article Headlines about Income
Inequality.

~~~
the_watcher
They almost certainly are. Buzzfeed didn't become synonymous with clickbait by
random chance. It literally spun out of a research lab studying the viral
spread of online content.

~~~
jimbofisher1
Why don't you go find out how many articles they have written about inequality
and tell me how the statistical power of their AB test looks. lol

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foxhop
We should have a billion dollar networth cap. If you pass it, it gets taxed
extremely, like 95%.

~~~
mbesto
Ugh, this again. Net worth != income.

I get the spirit of what you're saying but you can't tax net worth, you tax
income.

~~~
kungtotte
You can absolutely tax net worth. It's not difficult at all.

You can add/increase property taxes. You can tax wealth above a certain
amount. You can add/increase taxes on stock market speculation and holdings,
and other financial instruments.

Whether you'd want to is a different matter, but saying you can't do it is
factually incorrect.

~~~
moate
right. The story told is that the money in the market (stocks, shares of
companies, holdings, real estate, etc) is playing a part in creating wealth
for everyone, and therefor better served by being left where it is.

there's 0 reason you can't say "this person is reporting holding, assets and
liquid wealth of 2 billion dollars, so he owes X% back to the state." The
issue is that typically the wealthy have the most influence over tax code, and
they use net worth as a way to keep their money out of play.

But, like, you know, Amazon being worth so much money is really helpful to
_everyone_ because...reasons.

------
Kilonzus
As someone living in one of those top places, I think the usual consensus is
that cities like New York and San Francisco and Washington DC are the most
expensive cities to live in yet I live in a relatively conservative state tax-
wise and people out here are still getting killed by the house prices. Rent
has doubled in almost 3 years as well as many low-income families being pushed
out of areas that used to formally inhabit.

------
dsfyu404ed
The pairing of places associated with business and leisure should come as no
surprise. The super wealthy do their business in and primarily live in the
former while maintaining vacation properties in the latter. Then when they
just want to coast on the returns they primarily live in the latter and
charter a flight or spend a few days a week in the former as needed to for
business.

------
the_watcher
I'm pretty sure the map at the bottom is wrong, at least in CA. The 5 CA
metros listed are San Jose, San Francisco, Napa, LA, Santa Barbara, but the
map shows 4 Southern CA dots (including one that looks like it's in the
southern Central Valley of all places)

------
hnburnsy
I was shocked when in an interview yesterday David Rubenstein, The Carlyle
Group co-founder and co-executive chairman of the private equity firm that
owns 275 companies, mentioned that he worries about 3 things:

1) National deficit and servicing entitlements 2) Tariffs 3) Income inequality
and possible social disruption

1 and 2 were not a surprise, but to me 3 was.

Here is the full interview.

[https://www.cnbc.com/video/2018/07/18/carlyle-group-
rubenste...](https://www.cnbc.com/video/2018/07/18/carlyle-group-rubenstein-
dont-see-recession-near-term.html)

------
pmoriarty
Money is power, and some people are much better at getting their hands on
money/power than others. Regardless of whether such money/power is "deserved"
(which can be argued endlessly either way), we as a society really have to
question whether we want a society where the overwhelming majority of people
are screwed, and a tiny minority gets to own everything/everyone, call the
shots, make the laws, and order the rest of us around.

We and our children are going to be shining these people's shoes for
generations to come. Is that the future we want?

------
xyhopguy
interesting that Seattle isn't anywhere to be found. I've always "felt" that
the PNW had less old money. Anyone wanna feed my confirmation bias some more?

~~~
wgerard
Eh, I'm not sure I would read into this as "Seattle is super egalitarian".
Microsoft has made a lot of people (relatively) extremely wealthy, as has
Amazon.

Seattle's probably catching up quickly to some of the cities on this list.
Washington is just a much younger state.

~~~
xyhopguy
Not really what im getting at. The pnw was developed later so I'd expect it to
have less old money -- look at Oregon. The tech industry has certainly done a
lot for the upper middle class in Seattle but the article is talking about
people making 400k+ a year..

------
avar
This article doesn't discuss the elephant in the room. If there's this
discrepancy in the 1% between states, and that's seen as a problem, presumably
some correlation can be found where the bottom N% are less fortunate in say
West Virginia than New York.

Is there any indication that that's the case?

~~~
metalliqaz
What's the elephant in that metaphor? That the rich make the poor better off
by proximity?

If so, I think you're missing the point. It's not a particularly good thing to
have lots of people in "tolerable poverty" rather than total squalor. The
slight reduction in suffering isn't enough.

The real elephant in the room is the long term result of massive inequality.
Social unrest, violence, revolution. History is littered with these outcomes,
and many of those examples end with public executions.

~~~
avar
No, the elephant in the room is what supposed issues income inequality
creates. Surely if there's such a discrepancy in this number between different
states that's going to be measurable in some way.

My biases align with the sentiments of the article. I think that income
inequality is bad, but that doesn't make me immune to recognizing lazy
journalism.

The article does nothing to question that assumption. If an increase in income
inequality makes the difference between "tolerable poverty" and "total
squalor", isn't there going to be more of the latter in New York than West
Virgina?

The map in this article is almost the exact opposite of the one in the
article, showing an inverse correlation between income inequality and the
poverty rate:
[https://en.wikipedia.org/wiki/List_of_U.S._states_and_territ...](https://en.wikipedia.org/wiki/List_of_U.S._states_and_territories_by_poverty_rate)

So what exactly are the negative effects? I'm sure there's some, but the
article isn't helping us talk about those.

------
emodendroket
Wyoming is the surprise entry here.

~~~
bilbo0s
Why would Wyoming be a surprise?

Serious question.

Out here in Wisconsin we think of Wyoming as a state with a lot of wealthy
landowners. But that's based mostly on seeing huge farms, (ranches), that
aren't actually farmed. (When you see a huge farm that's not being farmed in
Wisconsin, you just KNOW the guy's richer than Crassus.)

~~~
logfromblammo
To be fair, the opportunity cost of not farming land in the Mississippi river
valley is a lot higher than not farming land in the rain-shadow of the
Rockies.

Not farming some of the most fertile land in the world makes you richer than
Crassus. Not ranching on land that can barely grow enough to support a
smallish herd just makes you sensitive to the wholesale prices for grazing
animals.

~~~
LyndsySimon
It depends on how much land, doesn't it?

A quick search shows that the largest ranch in Wyoming is Q Creek Ranch, at
560,000 acres. That's 1/60th size of the entire state of Mississippi.

Even if the land yields 1/10th as much as the rich farmland of Mississippi
delta, if it's 1/10th the price and holdings are 10x larger, then the same
value is being left on the table.

~~~
logfromblammo
...discounting the scaling operational costs due to vastly increased distances
to everything.

If you operate a small dairy farm in Wisconsin, with pastures near the barn,
and a more remote hayfield that is mechanically harvested, you can definitely
raise 20 cows with 40 acres, including plenty of margin for error. You would
only have to reduce herd size in a region-wide, multi-year drought. The rest
of the time, you're selling hay to your more-risk-tolerant neighbors. That's
200 short tons of milk per year, or 50000 gallons, with likely revenue between
$150k and $200k, or $3750-$5000/acre-year, discounting the excess hay, culled
beef, and veal calves.

If you're just sitting on the land, not even growing hay, you're leaving
heaping piles of money on the table.

If your land has 1/10 the yield, you now need 20 acres per animal instead of
2. You can't put up just one, convenient dairy barn, so you're just growing
meat. If you can get 200 pounds of beef per acre, that's maybe $1500/acre-
year. That's significant, but not as significant.

The actual ratio is likely much worse than 1:10. With normal rain, a Wisconsin
herd could potentially allocate 0.5 to 1 acre per cow. Out west, without
irrigation, it can be 35 acres per cow, or more. So if the Q Creek Ranch could
raise a herd of 16000 on 560000 acres, a Wisconsin farmer might be able to do
the same with 1.5% the land area in a wet year. That's a lot less distance for
the cows to walk, especially if the hay is trucked in from remote fields.

As it happens, Q Creek grazes from 6000 to 10000 cattle in any given year, and
they also maintain a herd (of unspecified size) of elk, deer, and antelope for
hunting. I'll estimate 2500 head of them, and call it 45 acres/animal.

Rosendale Dairy, the largest in Wisconsin, keeps 8400 cows, with 2800 acres
for hay. 1/3 acre/cow.

------
andrewla
This article, at least, talks about income, rather than wealth. Income we have
a concrete measure for, at least, rather than attempts at estimation with
giant unknown error bars. But income isn't a stable metric either. The IRS has
been continually changing rules over time. Most notably, there has been a
consistent push to crack down on "fringe benefits" and make them taxable.
"Company cars" and things like that are essentially dead.

To some degree the changes in the income characteristics here reflect changes
in the nature of compensation, from various tax dodges to just cash
compensation. It was once easier to give executives a car for their exclusive
use, rather than pay them the value of the car, since it was an allowable
business expense. That is no longer the case (unless the car is intrinsic to
their job) so rather than giving them a car and paying taxes on it, they just
give them the money and let them buy their own car.

To what degree does this inform the changing characteristics of income in the
top percentiles? That's an unknown question, but the best answer we have is
just to assume that nothing has changed in the actual income distribution
except the switchover from fringe benefit based compensation to taxable
compensation. But that, unfortunately, renders moot the entire point of
articles like this, about "worsening disparity", which is a convenient
bogeyman to point to about the dangers of unchecked capitalism. So instead, we
just pretend that this doesn't exist, and we continue to use made-up numbers
to try to make a social point.

~~~
weberc2
"Wealth" isn't a very good metric for other reasons as well. Notably, lots of
people who make median-ish income save every penny for retirement and
accumulate a lot of wealth, but they are often categorized as "greedy top X%".
In our zeal to find someone to lay blame on, we often pick the wrong targets.

~~~
zajd
> Notably, lots of people who make median-ish income save every penny for
> retirement and accumulate a lot of wealth

Not even in the same ballpark. You're not getting to $100mm in wealth on a
$50k salary. But you can be born in to it overnight. Or make that in one day
in the market if you're Bezos.

~~~
frockington
This is precisely why my goal is to set up my children better than I was and
teach them to do the same. As long as I am constantly improving and can share
that with my children I am happy. Comparing yourself to others, specifically
to the super rich, is not a healthy strategy long term.

