I believe your reasoning, while correct, misses the bigger point: most of that wealth is not in the form of huge stacks of dollar bills in a bank safe, but company stocks. The only way to give a check to every citizen is to dismantle all these companies, which would destroy millions of jobs and make everyone much poorer.

No, my point is that, yes, the poor people are poor, way too poor, and the rich people are rich, but the reason that the poor people are poor is not that the rich people somehow have scarfed up all the money the poor people should have that, then, would put the poor people in the middle class.

Again, the gripe of the poor people that the rich people have the money the poor people should have is at most $10,000 once, and that wouldn't put the poor people in the middle class.

Or to get the poor people in the middle class will take many, Many times the amount of money the rich people have, say, over a lifetime, say, working 40 years at $100,000 a year, $4 million, that is, 400 times the $10,000. So, that the rich people are too rich solves, for the poor people, at most only 0.25% of the problem of the poor people. So, what we need for the other 99.75% is not from the rich people but, in a word, the powerful people.

That's a longer explanation of my main point.

Every time I read stuff about the 1% and income inequality I always think about the same exact logic that you outlined here. Splitting up the wealth of the top 1% and giving it to everyone else doesn't even make much of a dramatic difference to them.

I agree there are stats that show CEO pay is at an all time high. Minimum wage adjusted for inflation is not as high as it once was either.

I also think we have to solve this problem by creating better and better jobs. Paying the high school kid who takes movie tickets in Seattle a $15 an hour minimum wage is not the long term solution. We need more well paying skilled jobs.

> Splitting up the wealth of the top 1% and giving it to everyone else doesn't even make much of a dramatic difference to them.

If it was remotely feasible to confiscate the wealth of the top 1% and redistribute it, there would be enough nominal value to double the net worth (or halve the net debt) of the remaining 99% of people. That seems like a pretty dramatic difference to me.

I agree there's a long list of reasons why we shouldn't attempt this, but top 1% don't actually have much to share around isn't one of them.

Or, take a 1% person and assume they have $100 million and we redistribute all of it. Then we would be giving that to the other 99 people, call it 100, i.e., include the (formerly) 1% person. Then each person would get $1 million, once.

But for the middle class, really want a job at $100,000 a year for 40 years, that is, $4 million. So the $1 million is only 25% of the way there. For the poor people, we still need to find the other 75%, that is, $3 million.

I made a crude, "generous", estimate based on the 1000 richest and picked 1000 mostly because I was able to get the Forbes 400 data easily.

For your 1%, we'd need some data on how much money they have. Do you have some data for us?

It's quite common to hear the "look how much the rich give to charity" argument. In reality this is often just a means of avoiding taxes.

Charities only have to spend 5% of their interests each year, and that can go to salaries, expenses and such. Why do you think so much of Warren Buffett's "charitable donations" go to charities he created? They are tax shelters that are run by his kids. That is his way of avoiding estate taxes.

Your point is partially correct, but Warren told Bill and Melinda that their foundation will get essentially all of Warren's fortune. Then the foundation will decide how to use it.

I doubt if Bill and Melinda will just sit on Warren's fortune and draw a salary for managing it. Instead, likely Bill and Melinda will allocate it as best they can.

Spending $100+ billion effectively is actually not so easy, but I do believe that Bill and Melinda and their foundation will spend the money as fast as they can find good places to spend it.

I was referring to the 3 billion Warren Buffett gave to his kids.

http://money.cnn.com/2012/08/30/news/companies/buffett-donat...

Sure, I didn't know that he did that, but I can understand why.

Warren's worth, what, $75 billion or some such?

Warren gave $3 billion, only $3 billion? Ah, chump change!

I get what you are saying. I just don't trust a word Buffet writes or says. He claims he isn't leaving any of his money to his kids, but he set each up with a billion dollar charity organization.

I once read a very good article, wish I could find the link, that talks about Buffet and says that anytime Buffet says something you should wonder what's in it for him. That while he is claiming your best interest, his hand is reaching into your pocket to steal a dollar.

You seem to be asking if Buffett is a really nice guy. In some ways, maybe not.

My only point was that even if confiscate his money and pass it out among the poor people, the poor people will still be poor and not in the middle class -- even Buffett and the rest of the Forbes 400 don't have money enough to bring all the poor people into the middle class just by confiscation and redistribution.

That's not the only possible point to make about inequality, but by itself it is correct.

Your analysis misses a fundamental point: workers add value to an organization. The basic argument I have is that they are not sharing adequately (i.e., sustainably) in the rewards for their labor. Rather than dividing up the finite resources of a few ultra-rich, lets try to estimate how the rich have fared in comparison to...basically everyone else.

I'm going to look at 2003-2013 for the somewhat arbitrary reasons that (a) full records are available for all years in question, and (b) a decade is a reasonable and convenient length of time. The effects we'll see are somewhat emphasized from the last 3-5 years, so the effects would be diminished if you looked at, say, the last 30 or 50 years, but the trends would still exist. (That is to say, this isn't a new problem.) I'm also going to use an inflation factor of 1.27 so the analysis can be done in constant calendar year 2013 dollars. (Numbers may not add or work out exactly because of significant figures and rounding error.)

- According to the world bank, US GDP grew 14.7% from 2003 to 2013 from $14.62T to $16.77T. [1]

- The total net worth of the Forbes 400 grew 89% from $1.21T to $2.29T. [2]

- Total payroll tax receipts (which is a good proxy for total wages paid by average folks, since they phase out at higher earning levels) grew 4.6% from $0.905T to $0.947T. [3]

- Meanwhile the total workforce grew 6.1% from 146.5M to 155.4M. [4]

Based on this data, it seems fair to conclude that nearly all of the growth -- i.e., the new value created in the US economy from 2003-2013 -- went to very rich people, and very little (in fact, a negative fraction when adjusted for the growth in the workforce) went to the people actually doing the work of creating that value. Now, there isn't anything inherently wrong about that...but it a) probably isn't sustainable, and b) has created a social burden because delaying the effects requires public assistance to take up the slack -- the number of food stamp recipients rose 214% between 2003-2013.

[1] http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG

[2] http://www.forbes.com/2003/09/17/rich400land.html

[3] http://taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=4...

[4] http://www.dlt.ri.gov/lmi/laus/us/usadj.htm

[5] http://www.fns.usda.gov/sites/default/files/pd/SNAPsummary.p...

You are saying that all or even a little more than all of the growth went to the rich people. Okay.

But you also wrote:

> The basic argument I have is that they are not sharing adequately (i.e., sustainably) in the rewards for their labor.

Let's see: Suppose a company has 100,000 near minimum wage employees and the CEO got $50 million last year. So, for some arithmetic

     50 * 10**6 / 100,000 = 500

So, distributing the CEO's salary among all the low level workers would give each worker only about $500 more a year, that is, about the same as working one week. Wouldn't even start to put the worker in the middle class.

Might argue that if the CEO does his/her job well, then the company will grow, hire another 50,000, currently nearly unemployed, low wage workers and promote some of the present 100,000 workers to management positions where they start to get into the middle class.

Net, to get the poor people into the middle class will take more money than the CEOs get, and one of the best approaches is to have more and better CEOs who create more and better jobs. One example may be the large company (?) that recently announced that all its employees, many at the low level, can go to college for free.

Again, it appears that the key to getting the poor people into the middle class is not rich people but powerful people, yes, maybe powerful because they are rich; but to be successful they need to use their power, and smarts, and not just their money -- because even the rich people do not have even 1% of the needed money.

Power? Maybe. Money? No.

You're looking at the wrong pot of money. Dividing up executive wages among the lowest paid workers has never been considered a reasonable proposal for solving inadequate wages for workers; a more reasonable proposal involves including worker compensation in the distribution of profits from the business. While the CEO might "only" make 50 million, the organization would be expected to make much more.

Let's take Bed Bath & Beyond (BBBY) as an example because, conveniently, their CEO made ~$50M in 2013. [1] Their annual earnings report indicates that they had a net income of $1.04B that year, and their corporate profile suggests they have ~60,000 employees. [2][3] If they spent 100% of their current profits on employee salaries it would yield ~$17k/employee. (For reference, the full-time minimum wage salary in 2013 was $15,080. [4]) Even under much more reasonable conditions -- let's say that we allocate 1/4 of net income to worker salaries -- then each of their 60,000 workers would earn an additional $3800, which is just about equal to the max EITC for a family with one child in 2013. [5]

It's really not about CEOs getting paid huge amounts, it's that workers are neither represented nor included in sharing the prosperity of their labor -- and taxpayers are subsidizing the difference.

[1] http://www.usatoday.com/story/money/business/2014/06/04/bed-...

[2] http://www.marketwatch.com/investing/stock/bbby/financials

[3] https://finance.yahoo.com/q/pr?s=BBBY+Profile

[4] http://www.epi.org/publication/minimum-wage-workers-poverty-...

[5] http://www.irs.gov/Individuals/2013-EITC-Income-Limits,-Maxi...

Good point.

For your

> You're looking at the wrong pot of money.

I was responding to the common claim that the worker bees are poor because the suits get too much money.

Your example would be really something for Apple Computer with, what is it, $195 billion in cash?