Let’s suppose that you start off right in the middle of the American wealth distribution. How high would you have to jump to make it into the 9.9 percent? In financial terms, the measurement is easy and the trend is unmistakable. In 1963, you would have needed to multiply your wealth six times. By 2016, you would have needed to leap twice as high—increasing your wealth 12-fold—to scrape into our group. If you boldly aspired to reach the middle of our group rather than its lower edge, you’d have needed to multiply your wealth by a factor of 25. On this measure, the 2010s look much like the 1920s.
He arrives at the “9.9 percent” by taking the top 10 percent and lopping off the top 0.1 percent. I think most economists would like to see an age breakdown. That is, take the 9.9 percent from among, say those aged 45-55.
Stewart talks about heritable wealth, and he rightly looks at elite colleges and universities as part of the process. Journalists who write about inequality generally do a lousy job, but I think this piece actually gets things more right than wrong.
Great post.
Add in fantastically expensive housing along the West Coast and NYC-Boston….
I think the common refrain from people in the non-elite professional class is:
1) By the time I’m done with housing and education expense I’m not well off.
Isn’t a lot of this wealth “housing wealth”. Overpaying for a house way smaller then someone less well off because that’s where 9.9% jobs are isn’t exactly wealth you can enjoy or access easily. It feels more like a burdensome expense.
Zoning is just a protection against your neighborhood going bad if the wrong sort of people move in. If you can’t control crime and acknowledge that “public schools” are a kind of property people won’t give up zoning.
Oh and by all means don’t consider how immigration adds to this problem, its not like many of these cities don’t have huge “cheap” real estate in prime areas.
2) We have been working overtime straining our minds since we were kids. Shouldn’t someone who works sixty hours a week at the top of their game be able to afford their mortgage.
3) Isn’t all this really just a function of the fact that we don’t get divorced and combine to professional incomes. What are you going to do outlaw dual income households?
He somehow thinks the 9.9% are to blame for lower class divorced. Now I personally think some of their social attitudes are to blame, but giving out more EBT isn’t the reason. What exactly is his solution, make well off women slum it? Have more investment bankers marry dumb bimbos?
“that campaigns against family planning and reproductive rights are an assault on the families of the bottom 90 percent, and that law-and-order politics serves to keep even more of them down.”
The planned parenthood I pass by is churning out abortions in the black ghetto at record pace, and it ain’t changing Baltimore. And “law-and-order politics” would improve the lives of the bottom far more then the top.
“That’s when I hear the legend of the SAT whisperer.”
SAT tutoring is a scam that produces little benefit. These UMC people are wasting their money and being conned. Guess that means more long hours at the office.
“The best thing about this program of reverse taxation, as far as the 9.9 percent are concerned, is that the bottom 90 percent haven’t got a clue. The working classes get riled up when they see someone at the grocery store flipping out their food stamps to buy a T-bone. They have no idea that a nice family on the other side of town is walking away with $100,000 for flipping their house.”
Even after all the deductions and other stuff he talks about, the bottom line is that the UMC pays more absolute $$$ then the poor, by a LOT. When you consider services received by the government its clear the UMC is net receiving and the poor are net gaining, by a LOT. All of the changes he recommends will no doubt raise more money from the UMC, which will no doubt end up in the hands of the top 0.1%, maybe with a few scraps of useless or self destructive handouts for the lumpen.
4) “The meritocratic class has mastered the old trick of consolidating wealth and passing privilege along at the expense of other people’s children.”
They pass on their genes, basically. And they aren’t necessarily holding anyone back (some of their policies and cultural attitudes are bad for lots of people, but the author clearly means it in the “more taxes for failed social programs” way). And all this talk of “privilege” mostly ends up being punching down at the WWC.
“We are also mostly, but not entirely, white. According to a Pew Research Center analysis, African Americans represent 1.9 percent of the top 10th of households in wealth; Hispanics, 2.4 percent; and all other minorities, including Asian and multiracial individuals, 8.8 percent—even though those groups together account for 35 percent of the total population.”
This is beyond dishonest. Why not separate out Asians. Oh yeah, the narrative.
There is plenty not to like about the bobos, but in terms of wealth lets keep the focus on the top 0.1%. They are the real crooks, even his graph shows they are the winners.
All these pieces are usually ways to scrape more taxes out of the professional class to fund progressive boondoggles so they can’t build the wealth necessary to challenge the 0.1%. His bromides against the bad dealings in many sectors of the economy are good, but having worked in them its not the 9.9% setting policy or lobbying government. At best they do so only as paid help. It’s the 0.1% making the decisions, and 9.9% just hopes they can make the next mortgage or tuition payment.
I’ve read a lot of pieces like this one before. Wrong diagnoses. Wrong treatment. No cure.
The article has zero value. It’s literally more of the same. Throw more money and power and failed ideas to achieve impossible goals. The 9.9% can just spend another hour at the office to pay for it. The regular people who are experimented on as part of this social policy can just live with the consequences.
The reference to the imaginary “campaign[] against family planning” is a tell that the author is a leftwing crank.
Except that hes an alt-right crank.
Asdf,
I completely agree with your take. I do not understand what Kling finds of value in the piece. It comes across to me as propaganda which uses rhetoric to advance a narrative. A deceptive narrative at that.
I guess I would agree with Kling that the author did not do a terrible job. But the job he was doing was to confuse and misrepresent the issue. Mission accomplished. Anyone reading this article would be more misinformed than before reading.
As an example, in the snippet Kling uses, the author suggests we need to jump twice as high to get in the top ten percent. This is actually a misunderstanding. To jump the same relative distance (50th pct to 90th) what we are seeing is a Doubling of reward for the same relative jump. In economists terms the market is signaling and rewarding jumping the same height twice as much. In grading terms, if we paid 6x for an A vs a C in past, the market is now paying 12x for the same A. Not sure how Kling misses this.
My further criticism of the piece is below.
Stewart rather gives his game away when he says that people inside the top 0.1 percent have “the kind of money that can buy elections.” That would be news to Tom Steyer. Also to Hillary Clinton, who outspent Trump by approximately 2-1.
Stewart’s prescription for “change that really matters” is a vague call for “action from the federal government” that destroys monopoly power, takes money out of politics, and transfers power from capital to labor, none of which, even if they could be reduced from exhortations to feasible government policies, have any promise of changing the stratification that concerns him.
He of course never mentions Charles Murray, who for 40 years has studied and written, with great insight, about the very trends discussed by Stewart.
The dispossessed class grows and moves the center left. The cost of government labor expenses grows with wages so we have less granular wage settings when the curve moves past the large segment of dispossessed. A double edged squeeze, growing unhirables and fewer management specialties.. At some point the wages get resorted, to get more granularity otherwise labor taxes crash.
What is the American dream? To rise to a prosperous and comfortable life, or to be better-off than your neighbors? I think the media is essentially mistaken here, because they always talk about upward mobility in relative terms. So if I earn three times more money than my Dad did, I still failed unless I moved up the percentiles.
Maybe there is less mobility than there used to be, but I still think the best yardstick is: Am I better off than my parents were? And generally the answer is yes.
Better off has a lot of components. You can buy more cheap plastic stuff, but you can’t afford real estate that is 1) near jobs 2) safe 3) has good schools.
Tuition and other items are less affordable too.
Relative status isn’t just about sports cars, its also about things like where you live and what opportunities you have.
The trend may be unmistakable, but the analysis apparently isn’t.
Whatever changes have happened over the past half century in the mechanism that makes the 9.9 percent, 9.9 percent still take advantage of it. A priori the fact that a multiple has change says nothing interesting about how difficult it is to achieve it.
Mostly good article about the problems, but not so good on solutions (typical of Marxists).
we need to understand that access to the means of sustaining good health, the opportunity to learn from the wisdom accumulated in our culture, and the expectation that one may do so in a decent home and neighborhood are not privileges to be reserved for the few who have learned to game the system. They are rights that follow from the same source as those that an earlier generation called life, liberty, and the pursuit of happiness.
They’re not privileges, nor rights — they are benefits. Benefits of Christian Capitalist civilization, plus the freedom to make lots of choices, including good & bad choices, and mostly choosing good choices.
The single biggest causal factor among poor Americans, both black & white, the biggest factor is promiscuous sex. Sex outside of marriage. Anybody growing up in area with lots of unmarried mothers and children not living with their fathers, they are unlikely to be in a decent neighborhood.
Neither do I have a good solution to this, but “slut shaming” seems more likely to help than blaming today on Civil War racism, or even on illegal immigrants.
If only some scholars had spent nearly the last 50 years exploring and writing articles and whole books on the sorting of the population by intelligence, which, combined with a strong correlation to income and high levels of assortative mating and socializing, would be predicted to establish an increasingly stratified, segregated, and rigid caste system on a once much more egalitarian, level, and mixed society. Then the facts in this article would not only come as no surprise, we would have a ready explanation for it, and know which explanations were erroneous and which policies aimed at ‘remediation’ hopelessly futile in terms of their purported goals and purposes.
Oh wait.
In addition to the above criticisms of the article, I disagree with pretty much every major point (except the problems with professional cartels and elite university selection). The author basically misframes every issue to obscure the real solutions and problems.
First, he continuously promotes the zero sum fallacy, suggesting that gains have to come from losses elsewhere. This is both deceptive and wrong.
Second, he pretends that only ten percent of the people are in the top ten percent. No. 53% of households spend time in the top ten percent (at least one year). Virtually no households are in the top ten percent every year.
He suggests mobility is a problem, but Winship and others studies show that mobility is comparable to Europe and the past with the exception of African American males. When we dive deeper into that issue the problem is upward mobility of black males without father figures dropping out of high school. As others above notice, this clarification interferes with the narrative though.
He ignores the effects of genetics, intelligence and culture. He suggests that growing up in a top household improves ones chance of success. This actually is not true. The adoption studies show little correlation. Genetics explains the issue better.
On Assortative Matching he implies those successfully marrying are somehow to blame for divorce and out of wedlock children. Again, I think a deeper dive would reveal that the same characteristics which make for bad producers make for bad spouses, including intelligence, cooperativeness, trustworthiness, time horizons, ability to resist crime and drugs, smoking and violence and so on. In addition, this draws attention to the dysfunctional safety nets which actively promote not marrying.
He repeatedly reverses causation and he does the age old rhetorical trick of conflating rule egalitarianism with equality of outcome regardless of contribution.
I could go on paragraph by paragraph, point by point, but the take away is that this is not a well done or even handed piece on inequality. It is propaganda and misinformation intended to advance a progressive narrative.