Wealth Inequality in America drawn to scale

pif

Democracy working as intended: people keep voting freely, people keep getting what they want.

twoodfin

I would flatly reject the idea that a just-graduated neurologist with a negative net worth due to loans is “poor”. Wealth being the integration of gains - consumption over time makes it a poor metric for looking at society as a whole. Something like 50% of Americans will be millionaires at some point in their lives—upper quintile per this chart, typically later in their earnings years. Almost all of them started “poor” as young adults, per this chart’s definition.

Gigachad

It's crazy the hundred millionaires in the top 0.1% are closer to a homeless person than Elon musk.

crostlybostly

A contrarian view: - Most of that wealth is tied up in assets offering services for americans (servers / warehouses). It would be much worse if the rich decided to spend all of that on consumption rather than keep reinvesting it in assets. - Even the LHS of that chart Americans are some of the wealthiest in the world. A lot of the middle class from many other countries would love to be on the LHS of that chart. - No one is expected to build wealth on a 40 hour minimum wage job. It is the bare minimum and most people get paid more. - Americans don't want wealth. Our spending habits are abysmal. I suspect if you gave every American $500K the chart would revert back to this in like 12 months

yewenjie

Tears fell through my eyes.

arjie

I’m not a one-percenter and my life is great. I don’t even understand why anyone cares about equality. The point is a rising standard of life. Equality isn’t anywhere near my top objectives. Pareto-optimal trades are good. Adding an implicit objective to minimize abs(w_i - w_j) makes many win-win things impossible. The coordination win that came from “thou shalt not covet” is substantial and we forget it at our own peril.

gus_massa

It shows an "ideal" distribution. How did they calculate it?

piokoch

Well, this was discovered long time ago, by Vilfredo Pareto, this is exemplification of his 90/10 rule. Having said that... We should be more honest here when we talk about wealth. If one asks "how much, say, Elon Musk, is worth" we see some crazy numbers with kirjillions of zeros. But those are not "his" money, this is how much his companies are estimated to have. Yes, he has large personal fortune, but it is nowhere near those huge billions of billions amounts. Second, staying with Elon example, his companies are paying people and other companies that pay people, so there is huge army of people who have food in the fridge because of Elon Musk (I've seen some estimates around ~1 million people overall). Again, they are nowhere near to be as wealthy as Elon, but still, they have a decent live thanks to his companies.

JohnnyFiveGuys

Does factor in the K shaped reality we're entering where if white and blue collar jobs become automated there will be only rent seekers and extreme unemployment?

bushbaba

Kind of makes a point to have a wealth tax. As the top 1% of w2 earners are paying a disproportionate amount of tax relative to too 1% of wealth holders. That or just raise interest rates to force these people to sell more equity

accountrequired

Certain people think wealth inequality is bad. Maybe that is the wrong way to look at it. Just look at all that opportunity.

j1elo

(Just an objective comment, I'm not positioning here) this honestly puts the "tax the rich more" in perspective. A tiny tax increment to the rightmost column would provide more money than 100 years of all the other pitiful contributions together.

solatic

Part of the problem I have with graphs like this is that they don't differentiate between paper wealth, being able to get a loan against the paper wealth, and hard assets (real estate, vehicles, cash). Let's take a personal anecdote for an example: I joined a startup when it was early-stage, stayed for a few years, and exercised my stock options when I left. The startup is now "successful", but still private; my shares have also surely been heavily diluted. I have no idea when I'll be able to sell those shares or how much they're really worth. I have no way of turning those shares into quality-of-life improvements for any foreseeable future. Do they make me "wealthy"? I don't think most Americans have a problem with rich people buying nice houses and nice cars, and using their wealth to pay for private staff. I think the real problem is how much of the wealth is allowed to stay off public markets. Cargill is worth more than $50 billion and its stock is not available on public markets. The growth in wealth of most AI companies - Anthropic, OpenAI - happened off of public markets, and so none of it trickled into the American middle class by their retirement accounts. Venture capital is keeping companies private for longer because, quite simply, none of the investors need the cash to pay for their cost of living, so they're quite happy to let paper gains continue to live on paper. If your company has revenues of $X million a year or more, you should be forced to make public financial reports (effectively forcing you to list stock on a public market). Period. I think economists will naturally disagree on how much X should be, and that's fine, but I have little doubt that there should be a line like that, somewhere. Concerns about public markets forcing short-term thinking are a different problem, one addressed by mission-lock implements (Eric Ries's recent book Incorruptible is great here). Public markets ensure that gains in wealth are shared more broadly across the economy and increase tax collection by incentivizing more frequent buying and selling of the underlying stock, since those are taxable events.

sandos

So.. when I google "median income eu vs US" I get some completely different figures: $51k / $64k-65k median for the US, and €21k in the EU. So the median household in the US has 3 working adults? Is $211k household according to that page.

PowerElectronix

>the top 0.1% is richer than the 99.9% Outstanding observation.

b3ing

I wouldn’t of expected median household at $220k, avg American doesn’t even make half that

azan_

Would you rather have richer (in real terms) society (including richer lowest decile) with larger wealth inequality or poorer society with smaller inequalities? You might argue that these are not really the only two options and that's fair, but let's assume they are. Surprisingly many people would still opt for second option. Musk was trillionaire, now he no longer is (so inequality decreased) but did it really change anything that we no longer have any trillionaire?

eulerpoolapi

Now a chart with the value created. 90% of people also don't create any value, that's the thing.

delis-thumbs-7e

Federal reserve does not count salary into Net Worth as far as I can see: https://www.federalreserve.gov/econres/files/Networth%20Flow... Since most people’s income comes from salary, it is very easy to read this graph wrong and it is a bit misleading. Say you are some dev who makes $500k per year, but likes to rent, doesn’t drive and is not very bothered with stocks. Their Net Worth - unless I understand this wrong, if I do please correct me - the would around zero, maybe less with student loans, so they would be amongst the poor. Ok, they probably would have a lot of savings in this scenario, but maybe they like to ride on a horse with no name and spend most of their income. Still I would not call them poor. Does it change the picture? Not really, because Musk et al. are so way beyond everyone else that the graph is extremely top heavy. It is a nice data visualisation regardless.

makerofthings

Why don't the humans from the left 99% simple eat the humans from the right 1%?