Blessed are the poor.....

[Winstonm]

A McClatchy Newspapers analysis of 2005 census figures, the latest available, found that nearly 16 million Americans are living in deep or severe poverty. A family of four with two children and an annual income of less than $9,903 - half the federal poverty line - was considered severely poor in 2005. So were individuals who made less than $5,080 a year.

 

 

The McClatchy analysis found that the number of severely poor Americans grew by 26 percent from 2000 to 2005. That's 56 percent faster than the overall poverty population grew in the same period.

 

The plight of the severely poor is a distressing sidebar to an unusual economic expansion. Worker productivity has increased dramatically since the brief recession of 2001, but wages and job growth have lagged behind. At the same time, the share of national income going to corporate profits has dwarfed the amount going to wages and salaries. That helps explain why the median household income of working-age families, adjusted for inflation, has fallen for five straight years.

 

Since 2000, the number of severely poor has grown "more than any other segment of the population," according to a recent study in the American Journal of Preventive Medicine.

 

That was the exact opposite of what we anticipated when we began," said Dr. Steven Woolf of Virginia Commonwealth University, who co-authored the study. "We're not seeing as much moderate poverty as a proportion of the population. What we're seeing is a dramatic growth of severe poverty."

 

 

In supposedly the world's richest country, isn't there something wrong with this picture?

[Guest Jlall]

In supposedly the world's richest country, isn't there something wrong with this picture?

not really.

[jtfanclub]

median household income of working-age families, adjusted for inflation, has fallen for five straight years

That one bugs me. The other one? Nah. If you can't find a job for minimum wage in this country, you're either

 

-mentally disturbed

-Physically handicapped (or ill)

-A felon, or

-A fugitive

 

If somebody wants to take a year off looking for a better job than bagging groceries, that's fine by me. But I don't feel bad for him either.

[mike777]

median household income of working-age families, adjusted for inflation, has fallen for five straight years

That one bugs me. The other one? Nah. If you can't find a job for minimum wage in this country, you're either

 

-mentally disturbed

-Physically handicapped (or ill)

-A felon, or

-A fugitive

 

If somebody wants to take a year off looking for a better job than bagging groceries, that's fine by me. But I don't feel bad for him either.

In the USA bagging groceries is a very good job. It is far, far from minimum wage.

Many of us would quit our jobs if we could get a job this good.

[Gerben42]

In supposedly the world's richest country, isn't there something wrong with this picture?

 

No, and the USA is not the world's richest country, it's Luxemburg (Norway is 2nd, the first non-European country is Qatar in 3rd). They have the biggest GDP although the EU in total has a larger GDP, although still behind the USA in per-capita income (but catching up).

 

Of the Western countries high up this list I think the USA has the highest difference between the highest and lowest 1% (I have no idea about the Emirates and other Arab countries at the top of this list).

[Echognome]

In supposedly the world's richest country, isn't there something wrong with this picture?

 

No, and the USA is not the world's richest country, it's Luxemburg (Norway is 2nd, the first non-European country is Qatar in 3rd). They have the biggest GDP although the EU in total has a larger GDP, although still behind the USA in per-capita income (but catching up).

 

Of the Western countries high up this list I think the USA has the highest difference between the highest and lowest 1% (I have no idea about the Emirates and other Arab countries at the top of this list).

You're missing a few very important terms in this.

 

Clearly, the U.S. has the largest GDP of any country.

 

Luxembourg may have the largest GDP per capita, although I haven't checked the stats lately. (I believe the Economist website has it, if not the OECD or World Bank will.)

 

However, just because you have the largest GDP per capita, doesn't make you the richest. You have to account for prices and the USA does very well at GDP per capita Purchasing Power Parity (PPP). That is to say that if two households made the same income in the USA and Luxembourg, the USA household would feel richer as it could buy more goods domestically. After all, do we really like the money? or what the money buys us?

[jtfanclub]

Clearly, the U.S. has the largest GDP of any country.

I don't claim to understand GDP or PPP, but I can look up stuff as well as anybody.

 

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

 

Geez, the Big Three are double that of #4. Wow.

 

The EU appears to be as big as the U.S. already, though I don't know if it qualifies as a country or not. Looks like China will be bigger within 5 years.

[Echognome]

Clearly, the U.S. has the largest GDP of any country.

I don't claim to understand GDP or PPP, but I can look up stuff as well as anybody.

 

http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)

 

Geez, the Big Three are double that of #4. Wow.

 

The EU appears to be as big as the U.S. already, though I don't know if it qualifies as a country or not. Looks like China will be bigger within 5 years.

It's hard to compare China because their currency is not openly traded. I'm not disputing the data, just saying there is a caveat. (If you note that China has a footnote on it in every set.)

 

I can understand someone wanting to compare the EU and the US, but then we should really be comparing the EU to North America because of NAFTA. Add those 2 extra trillion and it's pretty clear.

 

GDP is simply the value of all goods and services from a country produced in one year. We basically call this national income.

 

PPP I defined above.

 

It looks like on the ranking of GDP per capita PPP, Luxembourg is indeed first and the U.S. is fourth.

[Guest Jlall]

gnomed.

[helene_t]

I can understand someone wanting to compare the EU and the US, but then we should really be comparing the EU to North America because of NAFTA. Add those 2 extra trillion and it's pretty clear.

And Luxemburg should be compared to Rode Island. And Malta to Hawaii. I'd like to compare Greenland to Alaska, but Greenland isn't a member of the EU. Maybe we could compare it to Samoa, or the Channel Zone. Then what about D.C. ? Should it be compared to Belgium or only to Brussels?

 

There are even some who compare national depts to the distances between planets. You can compare anything if it amuses you.

 

When considering whether to move to New Zealand or not I'd compare my personal living in N.Z. with what I could otherwise achieve in Europe. Including the fact the the air is cleaner there but that it's problematic to bring my cats over because New Zealanders don't like cats who hunt endangered native birds so I'd have to keep the cats indoor. Who cares if the average rate of living is higher in Luxemburg than in Burkina Faso? I'm not an average person anyway. I might have more fun and/or more money in Burkina Faso than in Luxemburg, who knows.

[Guest Jlall]

I think Matt was replying to gerbens claim that USA is not in fact the richest country (with factual, unbiased statistics). He was not saying that one should base their personal decision on whether to move on GDP alone.

[cherdano]

Matt, please don't destroy our nice little discussion with, uhm, facts...

[Echognome]

Matt, please don't destroy our nice little discussion with, uhm, facts...

My bad. I just hear economic claims and it makes my skin crawl. I know Gerben meant no offense. But I guess it would be like someone claiming that they know the biggest integer and you'd be like "oh no you don't."

 

And thanks Jlall. You got my intention down. I'm not taking sides, just correcting the facts, Jack.

[bid_em_up]

But I guess it would be like someone claiming that they know the biggest integer and you'd be like "oh no you don't."

You show me the biggest integer and I will show you "one" better. :)

[helene_t]

Of the Western countries high up this list I think the USA has the highest difference between the highest and lowest 1% (I have no idea about the Emirates and other Arab countries at the top of this list).

May be true but this could partly be because the U.S. is a big country. In Europe we have income differences between countries and within countries and it isn't really "fair" to compare the European within-country differences to a single U.S. figure which contains within-region and between-region differences.

 

Not that I can suggest any meaningful alternative. Ultimatively it depends on what question one wants an answer to.

 

Btw, I've seen some extreme figures for Japan [Edit: actually the Japanse income disparity is very low, according to Wikipedia. Now I'm confused] but again wonder how "fair" it is. Between-sex and and between-age income disparity is more extreme in Japan than in Europe. While both may be "bad", in a sense it is less severe than disparity between social strata since poor wives usually receive money from their rich husbands and poor children from their rich parents.

 

Wikipedia gives a nice overwiew of the Gini coefficient (a measure of income inequality) in various countries. Some countries (most notably U.S. and China) have increasing inequality while others (Norway, France) have decreasing inequality. Europe and Asia have the least inequality, Africa and the Amaricas the most.

[Winstonm]

Maybe it's just me, but there is something similar to "survival of the fittest" in these number where the upper crust keeps gaining while the poor keep getting worse. In my mind, there should be humanitarian considerations in humanity.

 

Is this the goal of capitalism - gaining the most before we die?

[helene_t]

Maybe it's just me, but there is something similar to "survival of the fittest" in these number where the upper crust keeps gaining while the poor keep getting worse.  In my mind, there should be humanitarian considerations in humanity.

 

Is this the goal of capitalism - gaining the most before we die?

I don't think captitalism is particularely anti-social in this respect. Feudalistic societies are probably worse and I tend to believe that socialism also creates more inequality than capitalism does, allthough that is difficult to argue and might be wrong.

 

Of course accumulation of capital creates some inequality, but accumulation of natural-resource ownership is worse.

 

Early capitalism created a homogenous workers' class with sufficient internal solidarity to establish powerfull unions and powerfull left-winged parties. That's eroding now because of the labor market becoming more heterogenious. The collapse of the socialist ideology in 1989 may be a factor as well, but only in the short run. Probably the impact from 1989 has already decayed in Western Europe. In Eastern Europe it is sometimes over-shadowed by a reaction against the mafia-capitalism of the 90's.

 

In the U.S. I would guess that the impact from 1989 was the reverse since the cold war made any policy with the slightest smell of socialism difficult to sell. But I must confess that American politics is an enigma to me. It would make a lot of sense to me if the financial and moral bankrupcy of the current government gave rise to a wave of anti-conservatism with everybody turning communist, atheist, moslem or liberatarian, but somehow it doesn't seem to happen.

 

As for "survival of the fittest": I think that's a silly slogan. In economics, you might apply it to a theoretic Malthusian scenario, but not to real economies. And since economists stopped believing in Malthus (some 150 years ago, I think) it isn't even interesting in theory. In biology, it applies only in the trivial sense that those that are unlikely to survive are unlikely to survive, so it is a silly description of natural selection.

[jtfanclub]

I must confess that American politics is an enigma to me. It would make a lot of sense to me if the financial and moral bankrupcy of the current government gave rise to a wave of anti-conservatism with everybody turning communist, atheist, moslem or liberatarian, but somehow it doesn't seem to happen.

Well over half the people in the country are very happy with the current system. They may whine about little pieces, but they're all happy with their TVs, their cars, etc. Even if they're unhappy, they feel in some way they *choose* to be unhappy, in return for stability. I mean, look at what people are whining about...gay marriage and abortion, which have no effect on their everyday lives, and taxes and gas prices, both of which are much lower than Europe.

 

Most of the rest realize that this wave is going to crash, and fairly soon, but feel that nothing can be done about it. Foreigners are going to buy up everything in America and turn it back into a bunch of colonies? Nothing we can do about it. Social Security going bankrupt? Nothing we can do about it. Highest bidder politics? Nothing we can do about it.

 

The number of people who see real, fundamental problems AND think something can be done about it? Well, Ron Paul's polling at about 3% of likely Republican voters. The Democrats don't even have a non-mainstream candidate. I'd say less than 10% of the population both wants change and cares enough to do something about it. Maybe another 10% would be willing to follow if one of them became popular enough. An awful lot of people liked Ross Perot, but how many actually voted for him?

[DrTodd13]

Perot got about 17% the first time he ran. The terrible truth is that people won't vote for someone who hasn't been deemed "legitimate" and to be "legitimate" you have to have raised 50+ million dollars. The politicians are then beholden to their contributors. The sad fact is that charm and attractiveness and name recognition amount to a lot and while each candidate goes on and on about how different they are, in reality there is very little difference even between Democrats and Republicans.

 

Another sad fact is the human nature drives politics. An elite can stage a coup but if they then setup a system that is in conflict with human nature it will eventually collapse. If you try to make everyone equal then nobody sees any reason to try to achieve and so your society collapses from lack of productivity. If you try to establish a completely free society then some people will excel and others will fail and people will start to say this "luck of the birth draw" is not fair and so you start back down the road to socialism. Ultimately, people's covetousness drives them to want to live (partially or wholly) off others rather than accepting what they have. When people realize they can vote for people who will give them stuff then the system will start to collapse. In the US, over 50% of people receive a significant portion of their income from government. This number is projected to rise to 60% within 10 years I believe. Are these people ever going to vote libertarian? I seriously doubt it. Political expediency will stop any true social security or medicare reform. We have unfunded liabilities in this country of 60 trillion dollars. That is over $500,000 per household. Taxes will never cover this number. If you try to inflate to solve the problem you'll have hyperinflation and the economy will collapse. Will we default on our debt? Will we eliminate these programs when they become a burden or severely curtail them? I don't know what they are going to do but I find it probably that our current form of government won't survive this 800-pound gorilla.

[Winstonm]

I don't know what they are going to do but I find it probably that our current form of government won't survive this 800-pound gorilla.

 

I'm betting we hyperinflate our way out of debt because there is absolutely no politically palatable solution.

 

in reality there is very little difference even between Democrats and Republicans.

 

Left and right branch of the same party, both totally controlled by special interest groups.

[Winstonm]

As for "survival of the fittest": I think that's a silly slogan.

 

I use this in the sense of the "fittest" having no sympathy for the plight of the poor, as much sympathy as a jungle beast has for its dinner.

[Winstonm]

I mean, look at what people are whining about...gay marriage and abortion,

 

That's because their true happiness comes in telling others how they should live their lives - it makes them feel superior.

[helene_t]

Yes, and that's where Todd has it wrong. Even if the libertarian utopia was feasible, people would not like it. Other people's lack of freedom is more important than one's own freedom.

 

Seriously: I agree that it's a survival strategy for some politicians and bureaucrats to give everybody the illusion that income redistribution works in their favor. The latest SocDem PM of Denmark, Poul Nyrup Rasmussen, was quite explicit about this. When his coalition partner, LibDem Marianne Jelved, said that they should get rid of all the "I pay your bills and you pay mine" in the welfare system - she wanted only the net givers to pay taxes and only the net receivers to receive subsidies (including indirect subsidies) - the PM's answer was surprisingly honest: he was afraid that the middle class would stop supporting the welfare state (i.e. stop voting SocDem) if it became too transparent who was net giver and who was net receiver.

 

But I don't think that governments generally redistribute wealth from the rich to the poor.

- Most government activity is about other aims than income redistribution. Of course it .....

 

(sorry my computer crashed while uploading this comment so only half of it was received.).

[Winstonm]

But I don't think that governments generally redistribute wealth from the rich to the poor.

 

The object is to redistribute wealth to the government, who can then pay off the special interest groups.

[DrTodd13]

Yes, and that's where Todd has it wrong. Even if the libertarian utopia was feasible, people would not like it. Other people's lack of freedom is more important than one's own freedom.

 

Seriously: I agree that it's a survival strategy for some politicians and bureaucrats to give everybody the illusion that income redistribution works in their favor. The latest SocDem PM of Denmark, Poul Nyrup Rasmussen, was quite explicit about this. When his coalition partner, LibDem Marianne Jelved, said that they should get rid of all the "I pay your bills and you pay mine" in the welfare system - she wanted only the net givers to pay taxes and only the net receivers to receive subsidies (including indirect subsidies) - the PM's answer was surprisingly honest: he was afraid that the middle class would stop supporting the welfare state (i.e. stop voting SocDem) if it became too transparent who was net giver and who was net receiver.

 

But I don't think that governments generally redistribute wealth from the rich to the poor.

- Most government activity is about other aims than income redistribution. Of course it .....

 

(sorry my computer crashed while uploading this comment so only half of it was received.).

What do I have wrong? First off, it would be called a utopia if people didn't like it so this is just another way of saying a libertarian or anarchist utopia is impossible. I totally admit that barring a miraculous change in human nature that this is true. However, given that no form of government is stable, I feel totally free to prefer a societal organization that I believe minimizes the systematic violation of rights.

 

At this point, politicians just like power and they reward those who put them in power. They have two bases...those who give them the campaign money and those who give them the votes. The former are rich and the latter masses are comparatively poor so the government plays a gigantic shell game of taking from and giving to everyone in an attempt to make everyone feel as if they are a beneficiary. Of course, we all know that this is impossible and as Helene illustrates that if the cost of government were easily seen by people that they would revolt. The lowest 50% of wage earners benefit and the very highest of the financial elites benefit and everyone else in the middle is a net loser but hey...they are a minority so this is democrazy in action is it not?