There's no need for nuance here. Nuance is what you apply when something has merit. The direction the US economy is headed in has no merit. The ship needs a course correction.
Do you have a source for this?
> If you are born in the bottom fifth, your odds of making it out of there are roughly fifty/fifty.
Are you sure? In a longitudinal study of US income earners during a 20 year period [1], a majority of people who started in the poorest quintile cracked the richest quintile at some point. The degree of opportunity this points to is really quite astonishing if you think about it.
This study is a little dated now (1990s). I can't imagine it's changed dramatically, but I'd love to see a new longitudinal study that went up to the present.
[1] Google Books, "Basic Economics" by Sowell: http://bit.ly/grnsDF
> Do you have a source for this?
http://www.nytimes.com/2012/01/05/us/harder-for-americans-to...
This one doesn't talk very explicitly about the time trend, but it mentions studies conducted in different decades finding progressively higher levels of correlation between parents' and children's incomes; unclear if that's due to random chance or an actual trend.
Consider an farmer living in a village where incomes for everyone range from 200rs/day to 250rs/day depending solely on random chance (weather, locusts, etc). Relative mobility is high - depending on your crop yield, you could go anywhere from the bottom 1% to the top 1%. And you have no chance to go anywhere besides your farm.
None whatsoever, when the economy continues to grow, and most personal lifestyle indicators continue to improve? The net immigration trends strongly suggest you are mistaken. You say we don't need nuance here, but discussions on Hacker News proceed best with evidence, so please provide evidence for your broad conclusion.
Things being worse elsewhere doesn't make things good here. That's like saying the back of the Titanic was ok because so many people wanted to go there.
However, it just might suggest a reason to doubt the statement "The direction the US economy is headed in has no merit," with which I was disagreeing. If smart immigrants come here on a net basis (and they do), then maybe people who have a choice are voting with their feet to say that the direction of the United States economy is not as bad as it could be.
I note the lack of follow-up from the kind person with whom I was disagreeing, perhaps because he is busy with his real life responsibilities, just as I was for the last three hours.
This is something that I don't know if so many people completely understand. For instance, my wife and I combined put us well in the top 1%[1] of the US based on our salaries, but there is no way we are "rich". And b/c we are trying to be smart with our money, we don't live like most would expect from our combined salaries. The issue, as I see it, is that our salaries are obviously not guaranteed.
Now, I fully recognize I'm in a privilege situation regardless, but we're not living a jetset lifestyle by any means. Sure, we are technically in the top 1%, but it isn't the lifestyle most people would envision when they think "top 1%". Though don't get me wrong, as I said, I DO recognize we are privileged and am not complaining, just saying we aren't living like those robber barons of old.
[1] - http://en.wikipedia.org/wiki/Affluence_in_the_United_States
I'm going to guess like most wealthy people, you simply have adjusted to the standards you can afford on that kind of income, and see it as "normal", and assume that most people have similar access to wealth.
I experience that quite often with people who are in the top 1%: "despite these vacations we take, the expensive things we eat and buy, and these other things you couldn't afford if you saved all year for it, which are regular course for us, we're not /that/ wealthy, because the 0.1% has so much more!"
So go ahead, knowing that I can barely afford to stay alive while working full time, and tell me that you're not that much more wealthy than I am.
The reality is that you'll make more this year than I'm likely to make in a decade.
(As a less aggressive side note: a better measure is worth than income, because as you point out, income is transitory.)
I make a very healthy income in the US, but live in a very expensive area as well. However, I consider myself very fortunate to have the life that I do, even though I have to settle for things like: public school for my kids and not driving a new car every few years (shudder!).
Is it education? Lack of jobs in your area? A disability?
I'm not trying to be condescending, just genuinely curious about your situation.
Working a job, realistically, is only going to get me so far, though, without one of those two factors. For what would be a modest investment on the part of most people I'd consider "wealthy", I could open a start-up where I'd make a reasonable wage AND have an ownership interest in the value of my ideas.
Similarly, connection to people in higher status positions would let me get a better-than-entry position.
I'm in the 5% according to this[1] based on my salary (not properties or anything like that, just salary).
Based on the tone of the thread so far to this point, people aren't going to want to hear this, but I also lack access to capital and ability to network with the wealthiest in my area. I'm literally an employee. I very high paid employee, yes, but an employee.
I too am only working a job and similar to you, it is only going to get me so far.
I started working at McDonald's at 16 in high school. I worked my way through school (RA, Dorm tech, other odd jobs), worked my way into an internship (skipped junior year to do internship), finished school and was lucky to get a job (2000). That job started at $40k, which was amazing for a kid out of school, I guess. From there it was extremely hard work, lucky breaks, taking some chances before wife and kids came along, getting a master's degree, having a few setbacks (financially) and starting over.
I'm making the money now, but I know this job won't last forever. I'm highly paid in this moment in time (and for the time I have this job), but when it ends, I can't expect another to just come along. So I'm saving. And preparing. And making sure this time doesn't go to waste.
The truly wealthy don't think like this; they don't have to. There is not "what if" future. The OP and I seem like we are in the same boat and, frankly, I get what he/she is saying. Salaried employees that happen to find themselves in the top X% are likely not living large or without worry like the truly wealthy[2].
[1] - http://en.wikipedia.org/wiki/Household_income_in_the_United_...
[2] - We are not "living large", we are comfortable. As an example. Wife drives a 2006 prius. I drive a 2007 minivan. Bought both used. We rent our home b/c rent-mortgage ratios in our area don't make sense to buy. Our kids go to public school. We worry about saving for the kids future like most anyone. We worry about retirement (neither of us have a pension) and we worry about health. A single high-cost health event could wipe us out. It almost did years back when wife got very sick and was in hosp/ICU for a week. Wiped out saving and had to sell car we had at the time and use CC to fully pay.
And, yes, I Know that we were able to recover in part b/c of the higher than normal salary. The point is, we aren't living like the silicon valley millionaires/billionaires people would expect us to be. We also worry about money.
The wealthy do not worry about money.
A lot of comparisons are being drawn, for example, between the 1920s and today. While the income distribution curves look startlingly similar, the concentration of wealth is very different. Most of today's 1%+ are "working rich," i.e., they receive the bulk of their income from salaries and bonuses -- not from ownership or direction of capital.
Most of the turn-of-the-20th-century rich were actual capitalists/industrialists -- "robber barons" who secured monopolies on commodities, trade routes, new technologies, and so forth. These robber barons built generational fortunes whose relative scale and unshakable concentration are unmatched by anything since, including today. Their children, grandchildren, and great-grandchildren enjoyed lavish fortunes not of their own merit or creation.
Today's income gap appears troubling, and I don't want to downplay it. But the frequent comparisons to the Gilded Age are superficial at best, and they veer us off topic. This is true whether one is looking at the comparison from either side of the politico-economic spectrum: the pro-capitalist side (because the majority of today's elites are not capitalists, per se, but wage earners in highly paid fields like finance), or the egalitarian side (because what, exactly, are we proposing to redistribute? Opportunity? Wealth? Salary? Market demand? And how will we do this?).
And that's not even touching on globalization, which seems inevitable, and which has had a major effect on the disappearance of working-class and middle-class jobs. The article touches on the effects of new technologies, access to them, and ability to master them -- but this seems pretty meritocratic unless access is restricted to the children of privileged families. That's where we need to turn our lens. That's where things start to look less meritocratic and more aristocratic.
It's time we took a more nuanced view of this issue. For one thing, we should look beyond the present income inequality and toward the future implications. Is social mobility going to suffer for the next generation? Is wealth concentrating in generational amounts? Is the current power-law distribution crystalizing into a caste system? By some indications it is, and by other indications it's not. Let's go there. Let's dissect this. We need less hand-wringing and more investigation.
I'd be much more troubled by an uneven playing field than by uneven scores at the end of the game. By many accounts, today's playing field is fairly uneven -- and that's where we should be focusing our attention and effort. At the same time, we need to be comfortable with the probability than a perfectly even playing field will still produce uneven outcomes. It might produce more uneven outcomes, depending upon one's choice of modeling. Nevertheless, we're looking too much at the symptoms and not enough at the underlying sickness in the system.