Not Being Able to Scrape By With $200k Is Usually Your Own Fault

Posted on February 17, 2012    Posted by      446 Comments

Gawker, that great engine of social egalitarianism, points us to an article in Toronto Life about the Canadian 1% and how they try to get by in Toronto, Canada’s largest city. The implication is that even with $196,000, which is the income line for the 1% in that far northern country (and that’s Canadian dollars, mind you!), it’s sometimes difficult to make ends meet in that nation’s largest city.

Then you read the article, which does things like complaining that after you subtract “wardrobe refreshes” and “the cost of sushi, pad thai and butter chicken” ordered in three nights a week because of being too tired to cook, $10,400 a month doesn’t go very far, and then drops this bomb:

Then there’s the stuff that fills our houses—the calibre of which is the subject of intense, unspoken competition among my peers and neighbours. During my entire childhood, spent in a comfortable lower-upper-middle-class neighbourhood of Montreal, I am quite sure that my mother did not waste a single moment worrying about replacing her laminate kitchen counters with granite or marble. There was no such thing as a $1,000 Bugaboo stroller, or anything like it. You could host a casual weekend party without spending a fortune on artisanal cheeses. Living the good life simply wasn’t the full-time, across-the-retail-spectrum pursuit it has now become.

Aaaaaaand that’s then I want to start pressing the “It’s time for the goddamned revolution” button. By the time we get to the breakdowns of the monthly expenses of the seven 1% households profiled for the article, which features line items like $800 a month on wine and $1200 for the vacation house on the lake, I’m vaguely surprised Toronto isn’t on fire. The only people I feel any sort of commonality with are the immigrant family, who pack their own lunches for work and aside from the hair salon line item seem to have some perspective on their cash. The retired couple who invested well and are living off the proceeds also gets a pass, because, hey, that’s the goal, right? Otherwise: Purification by flame.

The problem here is that once again we’re confronted with the interesting paradox of “the 1%,” which is that the incomes of within the 1% are surprisingly heterogeneous. It’s a category that encompasses both people with six-figure annual incomes and people making nine-figure annual incomes; likewise, it’s people with seven-figure net worths and people with eleven-figure net worths. The 99% of the 1% do not have helipads and supermodels and dormitories or libraries named after them at their elite school alma maters; they have mortgages and expenses and their kids’ educations will be a non-trivial percentage of their total net worth. So if you’re on the bottom rung of society’s topmost ladder, you’re going to feel you have more in common with the middle class than with the stinkin’ rich, because as a practical matter you do.

But that doesn’t mean you’re middle class, or that your problems are middle class problems; it also means that when you complain about how hard it is to make ends meet and yet you’ve got the lake cottage and you spend $1,000 a month on clothes, the people who really are middle and lower class are going to look at you like, would you please just shut up, you arrogant rich bastard, before I put you and your whole family up against a wall. This is especially true when, as is the case of the Toronto Life article, the heart of the “problem” is that apparently it’s harder today than ever before to maintain and display the overt social cues of your petit bourgeois status.

Speaking as a member of the petit bourgeois, dear other members of the petit bourgeois:

1. Please learn how to budget, because no matter where you live — even in the US! Even in most parts of expensive cities! — $200,000 should be sufficient for a very comfortable lifestyle without much stretching.

2. If you’re in competition with your neighbors about who can live the better lifestyle, you’ve already lost and you’re just embarrassing yourself. Status anxiety is for the betas.

3. When in public, please shut the fuck up about how difficult your life is, economically. It just pisses off everybody else, and there are more of them than there are of you.

4. If your life is genuinely economically difficult, see point one. If necessary, take your wine budget for a month or two and hire an accountant or financial planner and then actually listen to them.

This is not to say that those on the bottom rung of the 1% should not complain about their problems, ever. I’ve noted before that for most people their problems with money is not having enough; for the well-off the problem is managing it well. It is a real problem, and it’s useful to talk to people with the same sort of problem and figure things out. It’s also worth remembering it’s a problem most people would like to have, and will not feel entirely sympathetic toward you for having it, just like you are not entirely sympathetic about the money problems of, say, Alex Rodriguez, or he entirely sympathetic to the money issues of Mark Zuckerberg.

Now, you might say, hey, the people of the 99% are as clueless about my financial issues as I am to theirs, so why is it that I’ll get crap for it and they don’t? Because they have less money, stupid. They are suffering every other economic penalty imaginable; it’s not unreasonable for the social penalty for economic cluelessness to be just about the only thing that vectors upward. The fact you can brood about this at the lake house over the weekend should put this problem of yours in perspective.

So, as Gawker puts it, the 1% must stop insisting they’re not rich, right this instant. They are, or close enough to it for statistical work. If you’re at the bottom end of the 1% you might not be as rich as some, but the ratio of people you are richer than, compared to those you are less rich than, is roughly 99:1. Keep that in mind. Recognize it and be grateful. And rather than asserting that you are not well off, figure out how you can manage your money in such a way that at the end of the day you’re not wondering where the hell all the money went. Because that’s a lot of money. You should be able to live well and still have some of it left over. Even in Toronto. Or anywhere else.

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446 Comments on “Not Being Able to Scrape By With $200k Is Usually Your Own Fault”

  3. I’m genuinely curious: if we have a global perspective what’s the definition of top 1%? And how many Americans who are very much not in the top 1% with respect to America are in the top 1% with respect to the entire planet.

    Would it matter?

  7. THANK YOU. I love that you take the time and effort to denote exactly what’s wrong with things like this, and that you do it so well. Now where’s the damn revolution already?! (Not that I want it on a silver platter, but it’s high time.)

  8. This is why I’ve come to the conclusion that, for the purposes of social justice/taxation discussion, nobody should be using the word “rich.” It’s a distraction because it spends so much of its time haggling over the perceptions of these 200k/yr people. They ride around the outskirts of folks pulling down millions a year so they only perceive how much less they have that those folks, not how much more they have than folks making a tenth of what they themselves do.

    So instead of the discussion being about the fact that an additional 1% out of their top tax bracket would only impact one bottle of wine for them a month we get into this long blah-de-blah about their financial challenges. “What does it mean to be rich?” Who gives a crap? Arguing about goalpost position with someone who doesn’t want to play the game only plays into their desires – it confuses things and delays real action.

  9. Right now, the Canadian dollar is almost the same as the US dollar. That’s a big change from 15 years ago when the Canadian dollar was worth less than 70 US cents.

    One summer, my job was to work as a bank teller 5 miles from the Canadian border. The American customers would complain about the Canadian money (Monopoly money), and the Canadians would complain about he American money (the bill all look the same).

  10. After getting my most recent raise, I moved to cheaper housing, made so by splitting it 3 ways in stead of 4, and moving to a cheaper neighborhood. I also will continue cooking at home and eating frugally once we get a new stove installed.

    If I hit 200k/year, I will not move to a shwankier neighborhood, I’ll just have more money, less debt, and more savings.

  13. I wish I could say I’m actually surprised about this. I live not too far from Toronto (a hour’s drive away not accounting for traffic; with traffice about 2-3) so I can understand how expensive it is to live there. Even a hole in the wall bachelor’s apartment can set a person back $1000 a month (likely more; my figures are from a few years ago). Still, you can get just about anywhere in the city using decent public transit (decent compared to St. Catharines which has the WORST public transit in Ontario if not Canada) so there’s car expenses out the window. Or you can do what my parents did and live outside Toronto and commute in. You can get a lot more house for the same amount of cash outside Toronto, and as long as you’re close the the GO line you can get downtown in about an hour, hour and half tops. My dad commuted like this for years earning less than 200K and both him and my mom are now quite happily retired and living in their dream home. The difference is they budgeted, saved, and found deals where they could. They also found somewhere to retire where they could get a lot of house for what they spent. (Helps that the house the purchased 15 years ago doubled in price by the time they sold it.)

  14. Umm, yeah. Oddly enough, I’m not very interested in hearing someone who earns in three months more than I’ve ever earned in a whole year whinge about how hard life is for them and how they can’t live within their means. I’ve got some great crockpot recipes if they’re too tired to cook; can I have half of what they’re spending on eating out? Because damn. And while we’re on that subject, I wonder what the Venn diagram of these people and the people who complain about poor people spending $5 on McDonald’s looks like…

  15. So how much should the “1%” be taxed and how will it affect the US budget situation? Is there some point where they are taxed too much? If so how much is too much? What are the downstream effects?

    These are the questions that really matter to me.

  16. I agree with all of the above… but I will say, for whatever it’s worth, that a given income is pretty different for a family of four with kids if ONE person is making that much money and there is a full-time stay-at-home partner versus the exact same income with both adults working outside the house. On paper, my husband and I make decent money (not remotely close to $200,000, but enough that we’re always kind of astonished when we do the math) but much of that money goes right out the door again for child care. If one of us was making the money that it currently takes both of us to make, we would be rolling in dough, but we’re totally not. And we CERTAINLY do not have a lake house, a wine budget, marble countertops, a $1,000 stroller, etc., etc. Hah.

  17. Lot of anger going around. But really, take a look within yourself and try to determine whether you are angry at these people, or just mad that you aren’t one of them? (not talking to you, John, as you probably are the 1%)

  18. I make just under $100K/year, and my (same sex) husband currently has no income because he’s going to graduate school. We live in Manhattan.

    Things are tight in a sense – everything is more expensive than it was in California, and our income dropped, and there are particular expenses (commuting expense, in particular) which strike us as just being absoltuely insane. We don’t, for example, splurge on Broadway shows, because we just can’t manage to get together the money for that.

    And yet …

    we’re not *struggling*. We have enough that the basics are covered and we can indulge in luxuries. So … while it’s totally fair to do the comparative “OMG NYC is so expensive compared to SF” thing, it’s not really fair to complain; we’re pretty well off, all things considered.

  20. Yes, it’s those people who say “Yeah, it’s been really rough. I had to sell one of the cabin cruisers!” They you say “I’m a bit weak from hunger right now, so could you come over *here* so I can beat the crap out of you.”

    It’s not about where the goalpost is; it’s that whining about really petty stuff is annoying.

  22. I’m surprised this isn’t a NYTimes article. Of course, then it would profile people who ‘only’ make $1M/year.

  24. Yeah, but that’s an article by Jonathan Kay, a second generation conservative asshole. (His mother is Barbara Kay, also a conservative asshole journalist.)

    Most of the profiled families don’t seem to be bitching about not having enough money (except Jonathan Kay and the Lewis-Koonings), they seem to be saying that they’re not as rich as people think they are, though they are doing just fine. And all using Rogers, coincidentally.

  26. As one living near the city of Toronto, and as a family living in the upper end of the 2%, I still find the article (not the analysis by Scalzi) appalling. Our family manages to save nearly 50% of our gross household income for the future. Taxes, mortgage, cars, food, clothes, hobbies, kids, charitable donations etc all come out of the other 50%. It’s really not that hard, and we’re not hard done by (not living in a box & we take vacations).

    At $200k+ we would be saving closer to 60-70% because really, who needs to spend all that cash now? Save it for retirement, and then retire early. THEN you can really stick your nose in the air while all other other people in the 1-2% are still working and you’re travelling the world without a care :).

    In effect we manage ALL our daily, monthly and yearly (damn taxes!) family expenses in under $70k/yr. How? We hired a financial planner before we were married, and review the plan annually. Best advice ever.

  27. Kilroy: ah, so we’re being accused of the old ‘politics of envy’, are we? Take it from me: I looked deep within myself and determined that, no, I have a legitimate beef with people whining about how difficult their lives are when they are vastly more privileged than 99% of the population. As John points out, it’s graceless and self-absorbed.

  28. ExpatPaul:
    It is very easy to spend lots of money for very little wine.
    If we were talking about the stuff I buy from the local vineyard that costs $8/bottle? Yeah, I’d be feeding a serious case (no pun intended) of alcoholism.

  29. @ Frank: Yes, theoretically there is some point at which the rich could be taxed so much that there are significant negative downstream effects on the rest of us. It’s also theoretically possible that if we sent an expedition to Alpha Centauri, the locals there would get so pissed at us showing up without an invite that they’d burn it out of the sky. The distances involved in the two examples are roughly similar.

  30. I read an article several years ago in the Houston Chronicle which still sticks with me. It was pretty identical to the Toronto article you’re talking about here. One of the anecdotes in the story was about a woman who’d just bought herself a 60″ TV because she assumed, wrongly, that her new job would last forever. Instead, she got laid off within months, couldn’t find a job in either her chosen field or her desired price range, was whining about how “hard” it was to make ends meet–yet it never occurred to her to move into cheaper housing, sell the dream TV, etc. Other anecdotes in the article talked about couples where the wife had always stayed at home, the husband had always worked, and when the husband lost his job they were confused about what to do next when he couldn’t find employment. How hard is it to understand that, if the husband loses his job, maybe the wife should try looking for work? Which is not to say, truthfully, that it would be any easier for the wife to find a job, what irritated me about the article was the presumption that the tradition of husband working, wife staying home should remain intact even if the husband was unemployed. Beggars can’t be choosers.

  31. “Aaaaaaand that’s then I want to start pressing the “It’s time for the goddamned revolution” button.”
    This.
    THIS RIGHT HERE.

  32. iucounu: but what are they doing to you? I’d put it in the same argument as gay marriage, it just doesn’t affect me, so I’m not going to get all riled up about the issue. Life is too short to spend it being jealous about how other people live.

  36. @ Kilroy: I have some friends who belong to the 1%. I’m not angry at *them* because *they* aren’t clueless gits. *And* because they don’t use their wealth to intentionally manipulate the political-economic system to protect and increase their privilege.

    To quote Matt Taibbi: “And we hate the rich? Come on. Success is the national religion, and almost everyone is a believer. Americans love winners.  But that’s just the problem. These guys on Wall Street are not winning – they’re cheating. And as much as we love the self-made success story, we hate the cheater that much more.”

  38. As jillheather says, most of the people profiled don’t really seem to be complaining. They probably just opened their door to a reporter asking about their lifestyle. It’s the essay by M. Kay that tries to put a sob-story spin on the whole thing, and is the real disgrace. That guy needs some serious values realignement.

  39. Okay, so I live in Toronto. When my wife goes back to work after her maternity leave is up, we’ll be grossing not quite as high as some of those profiled, but close. And you know what? We’re good. We’re actually doing fine on her EI (employment insurance for you non-Canucks) and my salary, and when she goes back to work we’ll have no problem saving money.

    It’s hard to believe that some of these profiles aren’t being presented as satire, especially the wine budget and the new Benz every three years. These people are shopping at the expensive grocery stores and, I would guess, never glance at a flyer to see what’s on sale. They’re chasing the lifestyle that they see in…well, in the pages of magazines like Toronto Life. It’s sad, and it does kinda make me want to man the barricades with a Molotov cocktail.

    OTOH, you’ll get my butter chicken (The Host FTW!) when you pry it out of my cold, dead, deliciously sauce-stained hands…

  41. Bearpaw: why be angry at someone for being a clueless git? Why be angry at someone that tries to use the system in place to favor themselves? Shouldn’t we just be angry at all the lazy members of the 99% that aren’t doing anything to try to change the system to benefit themselves instead? Don’t hate those that have what you want, hate yourself for not doing enough to become what you want to be.

  42. I’m genuinely curious: if we have a global perspective what’s the definition of top 1%? And how many Americans who are very much not in the top 1% with respect to America are in the top 1% with respect to the entire planet.

    I’ll try and dig up the article, but if I recall, all but the poorest 10% of Americans are in the global 1%.

    Would it matter?

    Not sure what you mean here. The costs of living across the world are so disparate that this is a murky question at best.

    So how much should the “1%” be taxed and how will it affect the US budget situation?

    Just going back to the pre-2003 Bush Tax cuts would do more to lessen the deficit than the wars, stimulus, and TARP combined.

    Is there some point where they are taxed too much?

    At some point, but that’s what a truly progressive tax rate would address. Given today’s tax code (particularly around capital gains), it’s almost regressive.

    If so how much is too much? What are the downstream effects?

    Well, we know that a 40% top marginal tax rate (post Reagan-era tax reform) still allowed for enormous growth and a lessening in income inequality. And for the truly mega-rich the pre-Reagan reform top rates of 70%+ would likely lessen income inequality, reverse the state debt levels (and therefore reduce their dependency on federal aid), allow for a higher-educated workforce to compete in the tech arena, and stimulate industrial growth in the US.

  43. Of course, you’re right. But also, it’s an interesting framing problem. If everyone around you has a lake house (or digital cable tv or ipad or whatever), it shifts from “extravagance” to “necessity” in very short order. This is more a flaw in the way human brains work than anything else: we can rationalize anything. (“If we don’t have a $1,000 bugaboo stroller, our tots can’t see us when we stroll them, then their social insecurities will be greater than Betty Sue’s down the street, then our kids won’t be able to climb the social/corporate ladder, etc.”)

    In a world where now the bottom of the 1% are far below (and falling fast) the top 1% of the 1%, folks on $200K/year are going to feel like they’re working very hard and still missing out. I don’t sympathize, but I can (almost) understand.

  44. We are chaotic beings with chaotic minds in chaotic brains, embedded in chaotic society, because we evolved to prosper in a chaotic cosmos.

    But that makes household revenue hard to predict, when you live “on the edge of chaos” to use the Santa Fe Institute’s pregnant phrase.

    So, having just celebrated out 26th wedding anniversary, my wife and I can see that we had only two years comfortably above $100,000 (in dollars of the year, no corrections for inflation), and perhaps this one too, if my visiting professorship paperwork comes through or at least one novel of the past 12 sells.

    Two years at essentially zero, when little things like cancer and joint unemployment happened (and the Food Stamp folks are still claiming, after garnishing our taxes twice, that we owe $5.00 in food stamp overpayment, and threaten to garnish us again.

    The other years are somewhere in between, i.e. mid 5-figure income. But Greater Los Angeles is a relatively expensive city, though cheap compared to Jedda, Copenhagen, Tokyo, and he like. So the first $60,000 are the “nut” allocated in advance for mortgage, insurance, taxes, gasoline, electricity, food, garbage collection, and the like. Until that’s earned, there is ZERO discretionary money to spend for, say, going out to dinner or a movie.

    My wife is, after 11 years of hell, working for a virtually illiterate sexist terrible teacher and terrible administrator, subsequently “voted off the island”, Chair of her university Science Department (Astronomy, Biology, Physics). I do, well, I’ve said more than enough about me in other postings. Our son earned his double B.S. (Dean;s List) in Mathematics and Computer Science by age seventeen, and then his J.,D. and passing the rigorous 3-day written California Bar Exam by 21, because it takes credentials to survive On The Edge of Chaos. And his monthly payments on student loans (USC is $60,000/year for tuition alone) are slightly larger than our mortgage payments. So he has to write custom software for Hollywood (and in start-ups).

    Our dog is going blind and deaf at 15, and doesn’t know what time it is very well. This morning, way before I was ready, she insisted that 4:30 a.m. was time for breafast. Right now, dammit.

    So I’m wondering if I need another distinguished visiting part time professorship on the Pascific Rim. In Vancouver, Japan, or China, probably, to add to the one in Sydney, Australia whose paperwork has not yet gone through. Because $100,000 is certainly not enough for professor/authors.

    In 1900, correcting for inflation, a USA University professor earned roughly $300,000. By definition, he (not he/she) was a pillar of the community, and thus had to entertain the richer bankers, lawyers, mayor, that sort. So had to have a home, cook, butler, gardener. By definition. That ship has sailed. In return for dumbing down American schools, with the pretense that every little boy deserves to graduate college, the iron law of Supply and Demand kicked in.

    “It’s time for the goddamned revolution” — d00d, the revolution happened. And this is what it gave us.

  45. Saith Jesse: “Well, we know that a 40% top marginal tax rate (post Reagan-era tax reform) still allowed for enormous growth and a lessening in income inequality.”

    From 1988 to 2010, that sub-40% top marginal tax rate allowed for an annualized GDP growth of 2.49%.

    From 1950 to 1963, the 91% top marginal tax rate allowed for an annualized GDP growth of 3.67%.

    Hmm.

  46. @ Jonathan Laden.
    Please see Mister Scalzi’s point number two of the article:
    2. If you’re in competition with your neighbors about who can live the better lifestyle, you’ve already lost and you’re just embarrassing yourself. Status anxiety is for the betas..

  47. I have no sympathy for people going bancrupt with 200k a year. My annual salary is around 50k, my wife works part time, so she makes like 10k. With 60k a year, I am able to live in a decent neighborhood, I own my house, and I’m generally able to buy the stuff I need. That said, I can’t really afford to save much more than my 401k contribution, I can’t afford a brand new car, and I sometimes have to make decisions on what kinds of things I can buy.

    And, I would say that I’m pretty well off.

    I come from a very poor family. Many of the things from Scalzi’s “What its like to be poor” article applied to my childhood. I work full time, and I go to school full time. It just makes me mad that these fat cats are supposedly not able to pay their bills.

    And I get taxed at a higher rate than they do. In fact, I have to PAY 2k in taxes this year? Why? because my paltry 5k earned by serving as a military reservist puts me in a differnt tax bracket. So, essentially, because I made an extra 5k, i have to pay two thousand of it.

    I’d probably lose my shit if any of those people were whining around me. There is no excuse, other than they are blinded by social status and care more about appearances than, ya know, the welfare of their family.

  48. This is a great post, and I appreciated Nathaniel’s question/comment at 10:20 am about the global 1%. Googling that, I found numbers in this range: an article on money.CNN says it $34,000 per person annually, and at guardian.co.uk, I found numbers that work out to about $47,000. Numbers worth reflecting on . . .

    (John – your last paragraph reads to me like you meant to say “at the end of the day you’re not wondering where the hell all the money went”? If so, the word ‘not’ is missing.)

  50. My wife and I bring in something less than six figures a year, and we live sort of tight week to week, but otherwise pretty OK. We usually get a decent tax refund each year, which gets us a vacation. We each have a car, mine is paid for and hers has a reasonable monthly payment. We know we’ve got it easy compared to a lot of people, which makes it so much more galling that the people with nearly everything can only see what they haven’t got.

  51. Saith Jesse: “Well, we know that a 40% top marginal tax rate (post Reagan-era tax reform) still allowed for enormous growth and a lessening in income inequality.”

    From 1988 to 2010, that sub-40% top marginal tax rate allowed for an annualized GDP growth of 2.49%.

    From 1950 to 1963, the 91% top marginal tax rate allowed for an annualized GDP growth of 3.67%.

    Hmm.

    FWIW, the tax code changed enormously under Reagan, but yeah, I’d be all over a 90%+ top marginal tax rate. For the truly rich (like, say, Romney, who’s in the top 0.01%) a highly progressive tax rate combined with parity in the capital gains taxes rates would limit the kind of tax shadiness that is only legal because it’s available exclusively to those with the funds to take advantage of it and they lobby Congress to keep it that way.

  53. “2. If you’re in competition with your neighbors about who can live the better lifestyle, you’ve already lost and you’re just embarrassing yourself. Status anxiety is for the betas.”
    Reminds me of one of my favorite Dizzy Gillespie songs (from his Jambo Caribe album, don’t know who actually wrote the song), the refrain of which goes:
    Don’t try to keep up with the Joneses,
    Live as we used to be,
    Don’t try to keep up with the Joneses,
    They got mo’ money than we.

    I’m definitely not even close to the top 1%, let alone the top 1% of them … I’m now on old age benefits plus my wife gets benefits (the so-called “Allowance”) because I’m eligible plus she just turned 60 last year. Between us, we get a hair over C$20K a year, but since we’re in geared-to-income housing and have subsidized drug coverage we’re actually in fairly good shape for flexible budgeting.

    And I agree that if you’re not a conspicuous spender looking to outdo your “peers”, Toronto’s a great city to live in. It was already noted above that the transit system is great … I think I remember hearing that their goal is to have no place in Metro Toronto more than 20 minutes’ walk from public transit, and a fair chunk of it, especially the mile or so strip closest to Lake Ontario, runs all night.

  54. Ah, taxes and people and their money…You are right about the opinions of people who make far less. I gross just over $30,000 a year…I share a car with my husband and our grocery budget is $150 a month. While I do think spending $800 a month on wine is just as ridiculous as a rap star shredding hundred dollar bills to bling out her weekly manicures, I also think taxes should be fair across the board. Don’t string me up for this–but what if everyone paid the same percent? Those of us who make less would pay less because we make less. Taxes would be based upon equal percentage. And those who make more would pay the same percentage, but on their income. No brackets, no extra pulls on the 1%…or the middle class…or unfairness towards any one income whatsoever. And budgeting (which should be part of your math requirements for exiting high school, in my opinion) –if you can’t, you’re right–you have nothing to complain about if you spend more than you earn. My idealism may seem somewhat ignorant in this case, but I can’t help but think that from my income, to the people below me, to the 1% and the the government, etc., a little budgeting and not spending outside of your means would be..well…life saving, country saving, and world dominating….that last part maybe not so much. But just imagine if people didn’t spend money they didn’t have…and people, all incomes included, weren’t pissing away all the cash they did have and instead, budgeted and spent a little more wisely. What a world that would be….

    Well said.

  55. Just for the record, the marginal tax rate on income over 130k in Ontario is 46%, and everything 85k-130k is 43% (this includes provincial and federal taxes). There is also a 13% sales tax on most goods (also includes provincial and federal). (Taxes on capital gains and dividends are lower.)

    I am not going to argue that we couldn’t have a higher top rate at a higher income level, but taxes are, in general, higher in Canada (no mortgage interest deduction) and arguments about tax policy in the US shouldn’t be made based on what people in Canada say in a lifestyle piece.

  56. Most of the profiled families don’t seem to be bitching about not having enough money (except Jonathan Kay and the Lewis-Koonings), they seem to be saying that they’re not as rich as people think they are, though they are doing just fine.

    I get your point, but this is part of the problem. These people are saying that they’re “not as rich as people think they are.” And yet they are exactly as rich as people think they are, and they don’t find anything remarkable about it because they aren’t in the class of people who can burn $100 bills to keep the house warm? Seriously – it’s when people like this say that they are just “doing fine” rather than acknowledging that they are, in fact, doing exceedingly well that the rest of us throw up our hands at their cluelessness. Their very cluelessness is offensive – the rest of us are under no obligation to give them extra bennies for not being completely arrogant assholes.

  57. There are so many people I’d love to forward this article to – but most of them would (sadly) totally not get it.

    They think I am illogical for wondering why it is right for me to pay 30% to the government every year in taxes on my 5-figure income, while billionaires pay 15%. Somehow that makes sense to them – I’ve never understood how.

    On a side note – John, are there typos near the end?
    Should
    … such a way that at the end of the day you’re wondering where they …
    be
    … such a way that at the end of the day you’re not wondering where the …
    ?
    (Apologies for nit-pickyness, but the post is too good not to be perfect.)

    Have fun at Boskone! Watch out for Eddorians. ;-)

  58. Ugh. I live in downtown TO. I know what things cost here. Me and the bf pull in about 1/3 of that limit together (me being in grad school will do that). And you know what? We live comfortably. Decent if not luxurious apartment, enough money to go out for a drink or a meal every so often. Cook good food at home. And go for like a small vacation once a year. If these asses want to live in Yorkville or a massive house on the watefront in Mississauga then yeah, it’s gonna cost them a lot. But that’s what earning more money means: you get to choose to live in a nicer area or a bigger house – that (and 800 dollar wine) is what money GETS you. If they have little money left over, it’s cos they spend their money on frivolities that others can’t afford!

  60. @ Kilroy: “Shouldn’t we just be angry at all the lazy members of the 99% that aren’t doing anything to try to change the system to benefit themselves instead?”

    Oddly enough, some of the 1% are angry at those of the 99% who are trying to repair the system.

  61. And yet they are exactly as rich as people think they are, and they don’t find anything remarkable about it because they aren’t in the class of people who can burn $100 bills to keep the house warm?

    But they’re not. People in the top 1% are yes, doing very well, but they’re not in the class that many people imagine when they think “top 1%”. People imagine seven figures a year, not six. I’m not saying to feel sorry for them (although, again, none of the people seemed to want any sympathy except Jonathan Kay and the Lewis-Koonings). But what are they supposed to find remarkable, and what should they have said *that would have been published given the framing* that would have made their mini-profiles not offensive?

    Seriously – it’s when people like this say that they are just “doing fine” rather than acknowledging that they are, in fact, doing exceedingly well that the rest of us throw up our hands at their cluelessness.

    I said “just fine” which, to me, is better than “fine”; I meant it as “I’m doing very well, thanks, but don’t want to go into the particulars”.

    I still think that the objections to the article — and there are a lot of good ones — should be about Jonathan Kay and not about the families profiled.

  62. touching upon several comments plus op…
    Everything is relative of course. I am sure there are people in the world who would consider someone here making $30,000 and splurging on something like books or internet service is foolish. Whether a 1% splurges or saves and packs their lunch is really their business. I cannot applaud one for doing that and saving everything vs spending it on expensive wine. If anything, spending it helps put money back into the economy and is taxed again. If one cares for the poor then the excesses of the 1% help them does it not?
    As for taxes, I would love a flat tax for all. But entitlements and those who want or need them being what they are would force rules and loopholes which would lead us back to pretty much where we are.

  63. Anyone remember the law professor who posted a blog about how Obama’s tax hikes would hurt him so badly? He was complaining bitterly about how he and his wife could barely get by on their combined $400,000 salary. After paying for new cars, retirement, college savings plans, private school for their children, various nannies and cleaning folk, why, they barely had anything left!

    He seemed genuinely upset and angry that people did not show sympathy for his plight, and completely unaware that he was living an unbelievably good life beyond the reach of most.

  64. So, my household income between my wife and I is somewhere in the 80-85K zone, I wonder where that puts us on the % scale, probably well above half.
    Having said that, I try to live by the points laid out in this article, not trying to keep up with the Jones’, living below our means, paying off debt as fast as possible, etc.
    By all measures, I think we live well. We always have food, we have friends who come over all the time (around our place it’s cheddar, cold cuts and coffee for entertaining), and we have some nice creature comforts like a dishwasher, central Air for the summer, mid-line electronics for entertainment, I could go on…
    The fact is, I think I have it pretty sweet, we really want for nothing. If I were suddenly thrust into the 200k world, I would think myself in a special place in heaven – at least for a while.
    It’s about perspective, people always tend to equate themselves with those around them, so once they cross the 99% line, there are expectations of these individuals, they’re expected to be members of such and such golf club or better, expected to drive such and such car, expected to serve such and such when entertaining, the list goes on. It’s very easy for them to fall into exactly the trap outlined in the article.
    The fact is, even those of us somewhere in the middle can be sucked into this kind of whining very easily. I think I live well and comfortably, but I know for a fact that some of my peers think I live like a hick, that I’m uncultured and uncouth because I live below my means. I don’t go out for sushi just to be seen doing it, I don’t have wine and cheese parties because it’s the right thing to do to network at this level, and I don’t haul my kids around in a huge SUV because I’m too cool for a mini-van. I easily could do all these things, and many of my peers do exactly that, then live their entire life just paying off loans which never seem to get paid off in full. In my opinion, that’s a lot of unnecessary stress, I like to be able to come home and go to sleep without having to constantly worry about a cash situation that I’ve created.
    I guess what I’m saying is that if the points you made here, budgeting, shutting up about how hard you have it, quit pretending you’re not doing well, and above all do your level best to NOT getting sucked into the consumer competition works for someone in my position, then surely it will work well for those at the bottom end of the 1%.

  65. Well, expenditure does tend to expand to fill income but there are some limits to that. Prior to starting my own business we were well in excess of those kinds of numbers, but, even living in an expensive part of an expensive city (or in fact, two expensive cities) I didn’t really notice that we were short of cash – in fact we saved dollops of cash while living in one of the most expensive cities on the planet. It might be down to the individual. Since our income more than halved, we’ve had more problems, mostly due to rent on one place eating 40% of after tax income, and having to pay out for the mortgage shortfall on another place. We’re still living comfortably though, and hardly on the breadline.

    One of the main things we stopped doing was eating out… that’s an enormous hog of cash and calories.

    Finally, $800 a month on wine? To be honest, depending on the type of wine you like and buy, you’d be surprised at just how little wine that buys you. That said, even at my height of wine buying and being a member of a specialist little club, I doubt I spent more than $500 a quarter… so again, I might just be a bit more tight fisted than these guys.

  66. $800 a month on wine is $26 and some change per bottle per day.

    a) That is a non-trivial amount of alcohol. Like, worrisome amounts, actually.
    b) They’re buying the wrong wine. I mean, you can buy really really lovely and tasty wine for the $10-$15 range. Snob wine, too. Invest in prosecco, not champagne, is what I’m saying.

  67. These people could probably empathize with former Detroit Mayor Kwame Kilpatrick, who was unable to keep up with a payment schedule for reimbursing the city for money he stole, due to the difficulty of getting by on $12,000/month in Texas. Perhaps they could form a wine coop, and save a bit on their monthly wine expenses.

    (Perhaps the article should be rewritten as an examination of the devastation that alcoholism can wreak upon an otherwise mostly reasonable budget, because a single man who opens a new bottle of wine every day? Alcoholic.)

  68. @Kilroy:

    The ‘lazy 99%’ are playing by the rules: paying taxes, going to school, working longer and longer hours, actually believing that hard work and education leads to the good life.

    Personally, MY anger comes from the evident lack of awareness exhibited by people who, by virtue of their fortunate situation, have an outsized ability to influence politics. They can contribute more money to the people writing the rules, thereby making it even harder for the ‘lazy 99%’ to get ahead.

    As for the tax question, it’s really not about fairness. Technically, it’s about pragmatism. Historically, when the rates on the highest incomes were especially high, corporate profits got plowed back into wages, pensions, benefits, capital improvements, and other avenues that were of more benefit to society as a whole than simply paying a handful of men gigantic piles of money. Call it social engineering if you want; I’d rather live in a well-engineered society than in one with the design aesthetic of a feudal kingdom.

  69. If so how much is too much?

    Let’s find out.

    what should they have said *that would have been published given the framing* that would have made their mini-profiles not offensive?

    “No comment”

  71. I’ m not in the top 1%, but I am comfortably in the top 20%. And any shortfall in money that makes it difficult to splurge is due to my (and my wife’s) decisions. We have decided to put money away in 401K for retirement and money in 529 plans for the kids to go to college and decided to switch to a 15 year mortgage to pay off the house earlier. But, I am not complaining. I don’t get to buy the toys that my friend, who makes more than I do, has, but that’s because I’ve decided to make different choices.

    I’m much better off than my parents were (who were much better off than there parents) and will not complain about my chosen lot in life. I have much to be thankful for and will not complain about having to cook food at home instead of going out for sushi every night.

  72. As a member of the 1%, I would just like to say that other members of the 1% who complain about how they don’t have enough money are assholes.

    I’m not saying that members of the 1% who complain about anything are assholes, because there is a lot to life that isn’t money, and depending on your circumstances, some of it might seriously suck. But the money part? You don’t get to complain. You especially don’t get to complain if you haven’t learned how to budget yet, because your >$200,000-a-year salary does not absolve you of the necessity of spending within your means. As horribly tragic and difficult as that spending within your means might be.

    PS Also as a member of the 1%, I could do with paying more taxes. But that’s probably a subject of another thread.

  73. $26 and some change per bottle per day

    So the cheap stuff then :)

    Not that I would recommend a bottle a day, but I do know wine liking couples who will drink several a week with meals and the like. But even then, I have a few friends who’d quite happily spend WAY more than $26 a bottle – hell, if it’s for a good Amarone I’ve been known to drop $60+ (although Trader Joes is selling a great one for $16.99 at the moment)… but I digress.

    A couple who like wine and entertain regularly can easily get through 3-4+ bottles a week. If you’re buying top marque Californian Cabs or Pinots then that’s quite easily $200 a week. But you REALLY shouldn’t do that if you don’t have the money to do that.

    It’s like drinking Champagne. You might be able to spend $200 on a bottle of Crystal, but frankly, the Kirkland Signature stuff for $19.99 is excellent, and it’s hard to find better than a Laurent Perrier for about $30…

  74. Most of the media definitions of top 1% are based on income not assets. The top 1% of income earners are very different from the top 1% of asset holders. Top 1% of income earners are “average guy makes good” doctors, lawyers, etc. Top 1% of assets are mostly big, inherited money, CEO’s that kind of thing. Top 1% of asset holders don’t generally even earn income the way it is typically defined in these articles. look at Mitt Romeny as an example

    John I have a lot of respect for you. Your advice is actually bad advice if you prioritize your own success and the success of your children. Given that you are already in the top 1% of income earners but not asset holders, and that you want to maximize the future earning potential of yourself and your children you should

    – Live in the absolute fanciest neighborhood you can conceivably afford
    – Max your lifestyle, try to appear much wealthier then you are. Good clothes, fine win, the whole nine yards
    – Put your kid in a private school that you have to mortgage your grandmother to afford

    You do all these things in order to allow yourself to network and fit in with people that are much much wealthier then you. you do these things so that when your kid graduates from his ivy league college he gets catapulted into success.Those connections are worth any price.

    This is how the game is played. i most parts of the western world. One of the reasons why I live in Silicon Valley is so I can play it differently and still have a chance of success.

  76. Unholyguy:

    Sorry, that’s actually pretty terrible advice in my experience and in particular regarding my field of work. The only one of those that I agree with in a general sense is that attending an elite school (either high school or college) has social benefits down the road, which may be worth the cost of attendance. But the rest of it? Meh.

  77. Frank:
    Under Eisenhower, the top marginal tax rate was 91%. For anyone reading this who doesn’t understand what marginal tax rate means, it means the tax rate on the *leftovers* after everything else is taxed at a lower rate, so the effective overall rate is still much lower than that. They weren’t paying 91% of their total income. Eisenhower was president throughout the 1950s, a time regarded as generally prosperous and with high economic stability. There was pressure toward him to lower tax rates, but he used the money to pay down the national debt instead. Unemployment was low. Inflation was low. National debt was dropping.

  78. Yes, well said, John, well said.

    My father, who spent most of his career as a supervisor of a bank vault, i.e., surrounded by money all day (and yet made surprisingly little, all told), one commented to me that you could have the money of a Rockefeller, but if you didn’t manage it you’d be as poor as anybody else. Seems Dad was right.

  79. Historically, when the rates on the highest incomes were especially high, corporate profits got plowed back into wages, pensions, benefits, capital improvements, and other avenues that were of more benefit to society as a whole than simply paying a handful of men gigantic piles of money.

    This! I’ve noted here–and other places–that when taxes were higher on the rich, and especially corporations, the money got plowed back in to the economy especially as regards new equipment purchases, wage increases and the like. Before DooDoo economics got in full swing, we could always tell where I worked when the company thought they were gonna have to pay taxes.. or at least more than they wished. The company started plowing cash into new equipment, upgrading old equipment, hiring more people, handing out pay raises, and the year end bonus went from being a cured ham or turkey or gift certificate during the first years of setup, to being actual cash. Not a lot mind you, but at least 50% of your weekly pay check if you were somone like me, to a bit more for some others. Every one benefitted.

    After DooDoo economics got a firm hold on the corporate mindset… not so much. In fact, say goodbye to the pay raises. Equipment? Well that still had to purchased as the company was still growing; wages however stagnated and the cost of living kept going upwards. Mind you, the investors got to put more in their pockets so what the heh right? Just shows us workers were lazy and jealous and all that. Who were we to complain that we had been making the same money for 5 years, or even closer to 10 years for some people?

  80. @Nathaniel Givens says: February 17, 2012 at 10:20 am
    What is the top 1% of the world?
    The US top 1% households is around 400k. (nyt article)
    The income distribution for the rest of the world is even more skewed then the US; there a couple really rich people and everyone else is more rational. CEOs make much less at your average non-US company than a US company. Salaries in the rest of the world are lower on average than in the US. Salaries in the 3rd world, which make up the great majority of people on the planet, are all in the bottom 99%.
    My guess is that using this information to make a back of the envelope calculation, the 99% would shift to the left. A lot.

    The top 1% of the world is ~25 million households. Given that the rest of the world is skewed heavily to the bottom 50%, we can infer that the top 1% of the world would be between 50k-150k. (which would include half of all american households. I would bet a huge amount of money that this was very close to being correct. My gut feeling is that 50K is probably too high.

    So yah, americans (and the rest of the 1st world) are RICH compared to the rest of the world and should STFU already.

  83. I’m genuinely curious: if we have a global perspective what’s the definition of top 1%? And how many Americans who are very much not in the top 1% with respect to America are in the top 1% with respect to the entire planet.

    The global 1% consists of everyone earning $34,000 per year and above, according to Branko Milanovic in “The Haves and Have-Nots”. That’s a little less than the average for the second-bottom quintile of income in the US. So you could say that roughly two-thirds of Americans are in the global top 1% and be, if not right, at least within a stone’s throw of being right.

  84. PPS On the wine issue, as several commentors have noted, it’s actually really, really easy to spend an extraordinarily large amount of money on not very much wine at all. My family and I have a glass of wine each with dinner almost every day, and easily go through two or three bottles a week, more if we entertain on the weekends. If you’re spending >$100 a bottle, or even >$50 a bottle, that adds up really quickly.

    However, even though we’ve tried the >$100 a bottle wines, we generally go for the $10-$25 a bottle wine, not just because we are budget-conscious, but also because frankly, the difference in quality is negligible. There are some $50-70 a bottle wines that we occasionally indulge in because they really are superb, but the majority of expensive wines are only marginally better than regular wines, if they are better at all (a lot of them aren’t). The $500 a bottle wines really aren’t worth it.

    But of course, wine is a status symbol, just like everything else. A brief example: my grandmother used to live in an area of California known for the tourist trade. A friend of hers ran a restaurant that had a wine list with wines around $30-60 a bottle and wines around $100-150 a bottle. At one point, she complained to my grandmother that she was going to have to take off all the $100-150 wines because they just weren’t selling. “Raise the price to $500 a bottle,” my grandmother suggested. “They’ll sell.” She did, and they did. At that point, people weren’t buying the wine because they thought it was worth ~$100 a glass, they bought it because they wanted to impress whoever they were out to dinner with. And that’s likely the state the author of the article is in, and his friends.

  85. http://blogs.wsj.com/wealth/2011/10/19/millionaires-control-39-of-global-wealth/

    Sigh, completely wrong as usual.Turns out the wealth is REALLY concentrated elsewhere. But comparing net worth and income are not the same thing. But if there are 30million people with a net worth > 1 million dollars. That represents 1% of the worlds households.

    Sigh, so now my guess is that the 1% world income would be between 200k-400k, about the same as the US. Which argues that the US is the same income equality as the rest of the world, not better or worse.
    http://en.wikipedia.org/wiki/List_of_countries_by_income_equality
    (which this article basically agrees with)

  86. @John, with all due respect no one who wants to get rich goes into your line of work. Your life experiences are pretty meaningless here, as were most of mine until I actually got into the income bracket where I could observe all this stuff happening.

    It DOES actually work that way, the people spending all that money are doing it for a reason, they are not stupid, it is well thought out, humans are dumb little monkey’s and easy to impress.

  87. It is easy to see how crass it is for those on the bottom rung of the 1% to complain but from a global perspective we are all the bottom rung of the 1%. About 3.5 billion people live on less than $2.5 dollars a day. My kids are not freezing to death, I am not malnourished and I have a great life expectancy. The reality is that all of us are members of the petit bourgeois. Part of the problem is that it is human nature to rail against those who have more and forget about how much of we do have.

  88. So, given that much of the US and Canadian population is in the global 1%, it makes the whining of the US/Canadian 1% even *more* STFU-worthy.

  89. I just hate all those old people that go up space elevators to have their old bodies replaced with superhot, superstrong, and supersmart bodies. And then the thoughtless gits have tons of sex without really considering that some of down here are just working boring jobs. Sure they have to go off to meaningless wars based mostly on economic protectionism of property interests, but that is just because the small number of leaders are too short sited or too protective of their positions to realize fhat if we just worked together, we’d all prosper.

  90. I thin the real issues is between people that live off labor and people that live off capital. The 1% thing is a poor approximation of that. Due to globalization, the westerners that live off capital are finding their motivations are diverging and becoming opposed to the westerners that live off labor

  91. The stupidity of the article is merely the self involved view point that screams pay attention to my martyr status! (which appears no matter what your income.)

    The reality of Scalzi’s advice is still true to a large number of people below the 200K line. Most of the people I run into who complain, are actually complaining that they can’t afford some version of “granite counter tops” or that they bought that item anyway and are now on the verge of financial collapse as a result.

    Few wish to recognize any personal responsibility for their plight. They certainly aren’t going to recognize that their plight is different than the family who has one or both adults out of work, a sick child, no medical coverage and is borrowing money to buy groceries.

    Its the nature of our modern 1st world culture. The trimmings vary, but the prevalence of our inability to live within our means is astounding. As is our ability to justify this spending.

    I don’t mean to imply that there isn’t a large economic crisis or that there aren’t lots of people who truly cannot manage the basic necessities of life for themselves and their families as a result. Nor do I wish for the world to support subsistence living for most of its population. We all have a right to some enjoyment from non-essential items. But there is proportion in everything and no one can have everything.

  92. Pity the Wealthy. Never has a class of people sufferred so greatly as the top 1% of earners in the 2000’s North America. Rend your garments and weep for their suffering.

  93. Peter, several of my acquaintances want to move or have moved to Thailand. This is because an annual salary of about $25000 US will buy them a nice house and land, a couple of servants, and a lifestyle that the 1% might enjoy here in the US. Meanwhile, a schlub like myself or DH in Thailand makes about $7000 annually with a Master’s and their own small business. Yeah, economies of scale, we haz them.

    For those of us who don’t want to move to Thailand, we don’t particularly hate those having or making more than we do. We just don’t enjoy seeing them gaming the system so that no one else can win.

  94. The interesting exceptions to me, as a novelist in book 3 of an on spec trilogy ALZHEIMER’S WAR set in Pasadena, Brasilia, Bangarore, St. Petersburg, and Shanghai in 2020 AD (and some chapters in space stations and moon bases, and super-poor 3rd world hellholes by way of contrast) are South American superpower Brazil, and India and China each of the latter 2 convinced that it shall be running the world soon.

    These countries are getting VERY rich very fast, while still having huge festering rioting slums and farms of VERY poor. The paradox being that in roughly 10 years the richet nation in the world (China) will be on average a POOR country. This has never happened before in the 500 years since the nation state was invented by Machiavelli and implemented by Isabella and Elizabeth.

    The nature of the corruption in Brazil, China, and India are very different, as I find in plowing through esoteric Economics and Political Science journals. And reading the New York Times and Wall STreet Journal and various Chinese and Indian newspapers & magazines online.

    You following the stories about Apple finally asking for an outside audit of Foxconn’s iPad factories where they had to put a net near the roof to catch all the exploited workewrs jumping off, workings shaking from neurotoxic effects of the n-hexane they user to clean your iPad screens?

    The term I found myself using was VINE = Vertically Integrated Network of Evil.

    Mind you, I am making a default prediction for 2020 AD. No nanotechnology, robotics, space travel, or computational biomolecular engineering not strictly based on science journal publications since 2010. No true AI (but quantum computers than can pass the Turing Test, used for Battle Fusion) or FTL or electroweak gadgets or first contact with ET…

  95. Kilroy:

    You’ve tried to paint the 99% with a broad brush of laziness and class envy (both of which are demonstrably false), so you’re not coming from a particularly strong pedestal here. And there’s plenty of evidence that the success of the parents is given to their children, and that a lot of the very wealthy in today’s economy either got it directly through parents, or were given so many advantages as to be essentially the same thing. After all, it’s a lot easier to learn financial know-how if you’ve got the money to go to big, well-ordered schools that actually teach you how to do it. That’s something that’s more or less being dissuaded from being taught in public schools and universities because it’s not seen as relevant (or if you want to be conspiracy-minded, out of the hands of the proles).

  96. “Living within your means” is a construct that makes sense for lower and middle class people where “living outside your means” is equivalent to blowing money on luxury items you cannot afford that won’t actually benefit you.. It actually does not make any sense at all once you start having serious money and are trying to grow that pool.

    Capital is all about leverage and ROI, how can I take my existing $1, use it to borrow $10 and then make $12 on the investment? How do I hedge the risk? Lifestyle is just another type of investment to these people, it’s a barrier to entry that screens out the proles and focuses a persons social time and energy on a subset of people that might be useful in growing capital.

    The top 1% of income earners, all they care about is getting themselves or their children into the top 1% of asset holders. When you look at it from that perspective, most of their actions make perfect sense. They did not get where they are by being stupid or bad with money.

    The blog post below illustrates the mentality rather well, while also makes me despair for humanity..

    http://www.nevblog.com/how-to-crash-a-party/

  97. The best coment on that article’s page, in my opinion:

    Billion-dollar idea: 1. Start tin-mining company. 2. Stake claim to ear of whomever assigned this story.

    I have lived in Toronto’s suburbia and my brother and sister-in-law live in Toronto proper, so I know something of the costs of living in that city… and anyone living there having trouble making ends meet on ~$200k CAD needs to learn to budget.

    (And it says something rather dire about these people if they think that being at the bottom end of the top 1% of incomes puts them in the “middle class”. *shakes head*)

    — Steve

  98. Certainly most Americans are wealthy by world standards.

    But the meme that most Americans are in the world top 1% is hyperbolic.

    The population of the United States is about 311 million. The population of the world is 6.8 billion.

    So Americans comprise 4.5% of the world population. It is the third most populous nation in the world.

    Of course the statement doesn’t have to be true to get the point across. About a billion people live in Europe & North America, so it’s probably within a handwave that Most Americans are in the top 20%.

  99. Jesse: I just don’t understand all the hate for the successful. It seems to be trending with the republican distrust of the intellectuals. There are people that have more money than me. There are people that drive nicer cars than me. There are people that live in bigger houses than mine. I don’t hate them for it. All the haters just need to admit that the real issue is that they are not in the 1%.

  100. I suddenly feel a lot better about buying my scotch in bulk. A $40 bottle of J & B once every couple of months is chump change. Even when you throw in my Netflix subscription, my monthly budget for entertainment is barely equivalent to one wine and cheese snack for these folks.

  101. @ pmyers: Another part of that is that the US/Canadian 1% have an outsized influence on the lives of the global 99%. Because of that, it’s at least as difficult for the US/Canadian 99% to do anything about global inequality as it is to do anything about US/Canadian inequality. Increasing economic mobility in the US/Canada could also make it easier to do that globally.

  102. I’m a Canadian. I’ve lived in Toronto. I’m aware that basics are expensive there compared to my current rural surroundings, and it’s infested by privileged people who complain about the price of lattes when other places in the country are suffering from a lack of sanitary latrines. It’s a problem requiring a solution, but it seems a little extreme to advocate taking off and nuking the place from orbit (it’s the only way to be sure) just for economic ass-hattery.

    You have to consider its politics, corruption and arrogance as well.

    Once those factors are taken into account, THEN orbital bombardment takes its rightful place in the pantheon of reasonable responses, and I’m okay with that…

  103. That describable commercial where somebody shouts
    “Do you have any _unwanted_ _gold_!” popped into my
    mind.
    Uh, no.
    I assure you, if I had any gold it would most definitely
    /not/ be….

  105. I just don’t understand all the hate for the successful. It seems to be trending with the republican distrust of the intellectuals. There are people that have more money than me. There are people that drive nicer cars than me. There are people that live in bigger houses than mine. I don’t hate them for it. All the haters just need to admit that the real issue is that they are not in the 1%.

    Well that’s because you’re coming up with strawmen arguments. They hate the game, not the playa (in the parlance of our times). It’s not hate for the successful per se, but hate for how much they get away with both in terms of actions and dollars. The six owners of Wal-mart have as much wealth as the bottom 30% of Americans, and have a poor track record of treating their workers with even the minimum legalities, let along common decency. Mitt Romney has hundreds of millions in assets that he gets taxed at half the rate of most Americans, and there’s plenty of evidence that he made that money by screwing over otherwise successful businesses to enrich himself and his company’s shareholders. CEOs get bonuses or severance packages of several million dollars, often times after running their businesses (or company assets) into the ground. Companies routinely ship jobs overseas to countries with poor working conditions and refuse to fund technical education, then turn around and complain that American workers are either too skilled or ask too much (or ask to be treated too “nicely”).

    So, in the end, success often has little or nothing to do with it, but rather greed on the part of a person or group of people.

    That’s what people hate.

  106. I always knew there was a reason I had zero interest in looking at Toronto Life magazine. A friend of mine ours as a concierge at a classy high-end Toronto condo. From the stories he tells, it’s clear to me that the main difference between people of average incomes and those with 200k+ incomes is that the latter are much better at wasting their money than everyone else.

    We’ve lived in Toronto for going on 15 years. It’s not a cheap place to live, but until my spouse’s disabilities forced us to buy and renovate a house we can just barely afford, our ~$50k income let us live in a quite nice 2 bedroom apartment (subdivided out of an old Victorian mansion with 10 foot ceilings) for ~$1,200 per month, all utilities included. Of course, we had no car and weren’t living in the city centre, but everything we needed was in walking distance and the subway was only 5 minutes walk from our front door. And we still had money for weekly takeout dinners and a massive book buying habit.

  109. I don’t hate them for it. All the haters just need to admit that the real issue is that they are not in the 1%.

    I think you’re missing the point. Capitalism only works when Capital is used to do things. Concentrating Capital into fewer and fewer hands means that less circulates. The “conventional” wisdom of 1980s style theory was that by giving money back to the top earners, they would spend more, which would stimulate the economy, and the money they have in banks would be invested by the banks in capitalist endeavours which will increase wealth.

    That doesn’t work when you reach the levels of distortion we’ve got now. Individuals can’t spend on economically productive crap in the quantities that are needed, and if they do, the impact on the overall economy is low. A billionaire buying a $500K Lotus, isn’t really as impactful as 20 people buying a $25K Ford… likewise banks don’t really lend money to new business any more because the returns on it are just rubbish compared to bond market speculation.

    And don’t get me onto the Angel and Equity investing scene right now…

  110. Every American must stop insisting they’re not rich, right this instant. They are, or close enough to it for statistical work. If you’re at the bottom end of the American earners you might not be as rich as some, but, viewing the world population, the ratio of people you are richer than, compared to those you are less rich than, is roughly 99:1 Keep that in mind. Recognize it and be grateful.

  111. Every American must stop insisting they’re not rich, right this instant. They are, or close enough to it for statistical work. If you’re at the bottom end of the American earners you might not be as rich as some, but, viewing the world population, the ratio of people you are richer than, compared to those you are less rich than, is roughly 99:1 Keep that in mind. Recognize it and be grateful.

    Americans as a whole may be better off than large parts of the world, but very few have a lot to be grateful for, since (1) the wealth of the world population will be skewed, and (2) the cost of living in the US is high (astronomically so in many places) compared to a lot of the world.

  112. Hate the game? You have to get involved and play before you can hate it. The 99% have all the power, they just don’t realize it. The 1% get to spend money to try to convince the 99% to support politicians that will enact legislation beneficial to the 1%. But the 1% still have just 1% of the vote. The game is stacked in favor of the 99% if they’d just play and not blindly follow whatever super pac tells them to do.

    As for Romney: why do you want to tax assets in the first place? Mr. Romney has been very successful both due to good family and his own intelligence and ruthlessness in business. He made tons of money and now, whenever he wants to actually spend that money, he has to convert it from his investments to cash, so he gets taxed again on the money he already earned. I’m not in the 1%, but a large part of my income is from capital gains on my past investments as well.

    No one forces anyone to work for Wal-Mart. Every single employee is free to go work somewhere else. And if you don’t like the very successful business model that Sam developed, go out and start a business with a better business model to compete and put Wal-Mart out of business. Frankly, I’m of the Target type and haven’t been in a Wal-Mart in years.

  113. $800 on wine? more like on whine!

    haha.

    Anyways, that is an absurd amount. If you drink that much, you should just switch to the hard stuff…its much cheaper. Being Canadian, he has no excuse to not like crown royal. (I’m from Kentucky, I have no excuse to not like Maker’s Mark.)

  114. WAITAMINIT! Is there a resale value on grandmothers? Because I think I just shit myself with glee! Twice.

  115. No one forces anyone to work for Wal-Mart. Every single employee is free to go work somewhere else.

    And there the case for the prosecution rests your honour.

    Geesh…. How to miss the point and then some.

  116. Daveon: So do you think all this money is just sitting in huge vaults ala Scrooge McDuck and the 1% are taking afternoon swims in gold coins? Rich people don’t keep their money in bank accounts. Their money is invested in stocks and bonds and property and other areas that make this country work. I’d be very surprised if you can find more than a couple of the 1%ers, that’s more than 2, that don’t have their money heavily invested. Meaning that their wealth is on paper and is being used through the economy.

  117. But they’re not. People in the top 1% are yes, doing very well, but they’re not in the class that many people imagine when they think “top 1%”. People imagine seven figures a year, not six. I’m not saying to feel sorry for them (although, again, none of the people seemed to want any sympathy except Jonathan Kay and the Lewis-Koonings). But what are they supposed to find remarkable, and what should they have said *that would have been published given the framing* that would have made their mini-profiles not offensive?

    What class did you imagine them to be in? Noone I’ve talked to about income inequality are picturing 7 figures unless they are specifically talking about a top fraction of the 1%. I and most of the people I’ve discussed this with have a pretty good idea of what $150K per year looks like (although, admittedly, we’re usually talking about the top 1% in the US where it’s $250K, it’s a bit lower in Canada, partly because their tax system isn’t quite as asinine as ours) and it’s kind of insulting when people assume that we’re all just ignorant and imagine every one in the top 1% to be millionaires.

    What should they have said? I don’t know – something along the lines of what the Jibodus actually did say :

    “Life here is so much easier,” Margaret says. “We don’t need to pay for chauffeurs or security or health care; in Nigeria, you must pay for everything.”

    Kudos to them for seeming to have some perspective on how wealthy they actually are. But we also got the incredibly galling Haynes saying

    “People think I make a lot of money,” he says, “but I lose so much of it in tax.”

    The man makes $165,000 a year. He’d have to be paying a 70% flat tax before it brought him down near the median income. He does make a lot of money, and dismissing it like that sounds a hell of a lot like whining.

    You’re right that Kay deserves the mother load of the scorn for writing this article. But my guess is that these people were told what the article was going to be about before they opened up in detail about how they spend their money. They could have said no. They get no sympathy for being willingly associated with this trash.

  118. “@ Jonathan Laden.
    Please see Mister Scalzi’s point number two of the article:
    2. … Status anxiety is for the betas..”

    “Status anxiety” is a fine shorthand, but it’s not about keeping up with the Joneses so you can compete to be cool or something. It’s more insidious: If everyone around you has cable TV, or water without the risks from the tap, or rear-facing strollers, you come to believe that this is part of the necessary minimum to get by. (“For the good of the children” or otherwise.)

  119. Actually Kilroy you generally do not have to convert assets to cash in order to “spend” them depending on what you are spending them on. Many many ways around that. Romney is a fool if he actually owns his own car for instance.

    I will also turn your question around on you and say “why should someone pay less tax from capital gains, then income? what is special and magic about that money that it should be protected?” The theory is that it has already been taxed once, however in many modern cases that is not true.

    in general if current US capitalism was a meritocracy, I would agree with you to some extent, to a degree. The problem comes in with inherited money perpetuating itself. Inheritance of wealth leads essentially to an aristocracy, which is kind of the thing we started this country to get away from.

    As far as the 99% having the power, that would work fine except for the well accepted, well documented fact that money can essentially buy votes through mas advertising.

  120. @Kilroy

    “Meaning that their wealth is on paper and is being used through the economy.”

    this used to be true, in the past there was something of a synergy between capital and economy in the US. However, now the question is “whose economy?”. Globalization leads the capital overseas. The synergy is broken between Western Capital and Western Labor. Now they are at odds, what is good for one is bad for the other.

  121. The 99% have all the power? Really? We don’t possess 99% of the money, not even close, and money is the powerful voice that drowns out the cry of the 99% and is mostly only heard by legislators on the take, which is just about all of them.

  122. Hate the game? You have to get involved and play before you can hate it. The 99% have all the power, they just don’t realize it. The 1% get to spend money to try to convince the 99% to support politicians that will enact legislation beneficial to the 1%. But the 1% still have just 1% of the vote. The game is stacked in favor of the 99% if they’d just play and not blindly follow whatever super pac tells them to do.

    The buy-in to “get involved” almost demands that you already be part of the 1%. You can’t be a legislator without significant amounts of money, which is why an overwhelming majority of Congress (on both sides and parties) is quite wealthy. Same with the money to lobby either legislators or Congress. There is absolutely nothing in our political system that stacks the game in favor of the 99%.

    As for Romney: why do you want to tax assets in the first place? Mr. Romney has been very successful both due to good family and his own intelligence and ruthlessness in business.

    Actually, he got his business acumen because of good family, there’s nothing to say he would be particularly good at it (apart from his willingness to be ruthless) without that massive advantage to start with.

    He made tons of money and now, whenever he wants to actually spend that money, he has to convert it from his investments to cash, so he gets taxed again on the money he already earned. I’m not in the 1%, but a large part of my income is from capital gains on my past investments as well.

    Capital gains taxes profits or sales on assets, not the assets themselves.

    No one forces anyone to work for Wal-Mart. Every single employee is free to go work somewhere else.

    Except when they come in and swallow up all the business in the area because they can sell things at a fraction of the prices others can offer and still make a profit where others can’t. That’s the advantage of being able to buy bulk at obscenely low prices and to source your products from places with otherwise prohibitive import costs.

    And if you don’t like the very successful business model that Sam developed, go out and start a business with a better business model to compete and put Wal-Mart out of business. Frankly, I’m of the Target type and haven’t been in a Wal-Mart in years.

    Yeah, it’s not as easy as “just” going out and creating whole new business models. The one they have is one of the most competitive out there, unless you care about your workers or the source of your products or any of a number of things that they just don’t care about.

  123. So do you think all this money is just sitting in huge vaults ala Scrooge McDuck and the 1% are taking afternoon swims in gold coins? Rich people don’t keep their money in bank accounts. Their money is invested in stocks and bonds and property….

    Well, actually, a lot of money is going into gold, in vaults, at the moment – hence the increase in Gold Prices.

    However, I actually did address this point. Money ‘invested’ in stocks and especially bonds – especially mortgage and other bonds does little other than make more money for the very rich, or extreme cases only for the banks.

    When we had that little “thing” a few years back when the financial services sector basically destroyed the US, UK, Irish, Spanish, Iceland and a few other economies – the banks, generally speaking, made sh1t tonnes of money by extracting it directly from tax payers in those economies.

    That money hasn’t come back into the general economy, it’s currently being used to speculate on the collapse of the Euro, which will make banks richer and the 1% or less who have assets there richer, but probably bankrupt every single person who is thinking of retiring in the next 5 years.

    You’ve bought into a lie. Nothing more, nothing less.

    Don’t get me wrong, I’m a capitalist. I just wish more people understood what that means.

  124. I’m kinda stunned. Every single one of them pays less than I do on their monthly mortgage, and makes more and yet I seem to have money left over. (I live in SF, which I love, but there is a major cost of living spike when you live here. I lost 200 square feet moving from Seattle, and donated nine boxes of books to the local library. This is a cost I accept, and I’ve been learning to budget better, save more, etc.)

    It’s not that I begrudge them their wine or their Eames chairs or anything like that. But simply put, THEY DID HAVE MONEY LEFT OVER. They just chose to spend it again on things like wine and Eames chairs and cottages by bays. It’s only in their heads that they are scraping by. They get to the end of the month and bemoan that they didn’t have MORE MONEY to buy the stuff, but the opportunity cost for them was not rent or utilities or food, but non-necessary items. One has the feeling that their consumer appetites might expand goldfish-like had they the extra income, and we’d still be hearing the same complaint. We couldn’t travel because we spent the money on amazing sushi. Well, yes. Opportunity cost at work there, but not exactly subsistence living.

    (I don’t put daycare or some educational opportunities for the kids in contention here.)

  125. Jesse, the places in America where the cost of living is Astronomically High are blue states with big government, high taxes and burdensome regulation. It’s spendy to live in Cali but move one state east and the cost of living drop precipitously, some times it bottoms out if you move all the way to rural states like Montana.

    And a side point: it one reason why so many businesses are fleeing Cali, Illinois and other blue states. Which compounds the poor plight of the lower class in the states.

  126. Devil’s advocate here…
    I am quite well off compared to probably 2/3 of the rest of the world’s population, and am happy about most things regarding my situation. Are you advocating that I should not try to do better, but be content with my lot? I should not complain about inequities I might see? If the 2/3 are permitted to be displeased with the current allocation of wealth (and I’m pretty sure some of them are, especially when they are malnourished, don’t have clean water, are living in filth and disease, etc., etc.) why should the 99% STFU? “Don’t talk stink about your betters; they’ll just buy out your job and fire you.”

  127. @PixelFish

    Have kids? kids are really really pricey especially once you start going down the “must get into Standford” route. Private school alone will run you 20-30K/year

    I make more then twice as much now as when I was kid less and probably have half the disposal income….

  128. It’s interesting that the narrative has now changed to “the 99% are actually wealthy on a global scale, so they should sit quietly over there and ignore the inequities in their system.”

  129. SandFlake,

    This discussion started out as “people making ~$200k are actually wealthy compared to all Americans so they should sit quietly over there and ignore the inequities of their system”.

    Gander meet goose.

  130. Scorpius my god, been drinking someones coolaid have we?

    Large urban areas with healthy economies have high cost of living due to cost of housing. This is especially true of urban areas on coasts where there is a limited ability to build new housing.

    California actually pays more in federal income tax then we consume by about 3:2 and is in fact funding a lot of these “red” states which are essentially living off our welfare and our rich retirees. And keeping their internal taxes low as a result. Silicon Valley alone basically pays for Arkansas.

    The other big factor is “right to work” laws and the race to the bottom for US unskilled labor. Northern states have laws that support unions, southern states do not, factories move south, people get paid less. That simple.

  131. The other big factor is “right to work” laws and the race to the bottom for US unskilled labor.

    What astounds me about this is how much we have forgotten economically. That old ‘marxist’ Henry Ford got it. He needed his workers to be able to afford to buy the cars that they were making, otherwise he was screwing himself out of an inbuilt market. The more people earn, the more they can spend in your own economy.

    The problem with wealth concentration is you soon hit diminishing returns.

  132. So do you think all this money is just sitting in huge vaults ala Scrooge McDuck and the 1% are taking afternoon swims in gold coins? Rich people don’t keep their money in bank accounts. Their money is invested in stocks and bonds and property and other areas that make this country work. I’d be very surprised if you can find more than a couple of the 1%ers, that’s more than 2, that don’t have their money heavily invested. Meaning that their wealth is on paper and is being used through the economy.

    Jesse, the places in America where the cost of living is Astronomically High are blue states with big government, high taxes and burdensome regulation. It’s spendy to live in Cali but move one state east and the cost of living drop precipitously, some times it bottoms out if you move all the way to rural states like Montana.

    That’s because states like Montana get a ton of federal subsidies. In fact, they’re one of the few states that get more from the feds than what they pay in. Also, businesses don’t often find regulation all that burdensome, nor do they worry about taxes, because both of those are almost always significantly less than the cost of doing business itslef.

    And a side point: it one reason why so many businesses are fleeing Cali, Illinois and other blue states. Which compounds the poor plight of the lower class in the states.

    No, it’s because other states give tax breaks and other corporate benefits to those businesses (this happened with Bain Capital’s companies a lot) and because they’ve made the cost of labor cheaper, such as Montana has.

  133. I understand that the middle class wants to tax the rich more. I understand that the rich want to tax the middle class more. I understand that the middle class and the rich want the poor to stop sucking up so much welfare and other costs to society. But the point remains that your stance changes depending on which group you are in. To those complaining about the 1% and the taxes they don’t pay: you wouldn’t be complaining if you suddenly started making more money and jumped into that group. So don’t complain that they want to benefit themselves when that is exactly the same thing that you want.

  135. you wouldn’t be complaining if you suddenly started making more money and jumped into that group.

    As somebody who has earned significantly over $250K, I thought I was undertaxed. Warren Buffett is complaining. Bill Gates is complaining. John Scalzi has complained about it.

    Simply put I think the issue is more that people who are earning MUCH less than these numbers are thinking that they wouldn’t complain without really grasping how much money $200K+ a year is as a monthly tax home pay, let alone over a $1 million.

    Somebody on $200,000 a year losing $500 a month in extra tax really REALLY isn’t going to see the impact on their standard of living that somebody earning $50,000 will see if they lose $50.

  136. So we should all become sociopaths and be happy about it because you have gross misconceptions about wealth, the safety net, and what the average American want? Fuck that.

  137. @UnholyGuy: No, I don’t have kids yet, but I believe I already ceded the educational opportunities and daycare for kids as a necessary cost. Did you perhaps misread my parenthetical? I know that that stuff gets expensive. One reason I was pleased my husband took this job was that if we did have a child, there’s free onsite daycare at his job, no small thing in SF.

    My point was that those families are spending their leftover money on luxuries and claiming to live month to month, comparing themselves to middle class families that do have to live month to month. In any case, the families that had kids still had a lot of extra luxuries, second cars, cotages, the like. They are still choosing to buy those items. They have vacations. The Jeep was a mistake because they could have used the extra money for travel, NOT daycare or rent or medial expenses. See the difference?

  138. Meh, this looks like envy to me. “Those darn rich people should be grateful” crap-ola. This is where you go off the farm Scalzi. Sure, we get it. The top 1% are the top 1%, no duh. But that does not mean the top 1% can’t tell their story. It’s human nature to complain. Do you get to deny anyone that just because you think its sounds ungrateful? Everyone has problems regardless of their income or wealth. It’s all relative. They have more expensive homes which comes with more expensive utilities. And yes, it’s no surprise they don’t furnish the house on a Ikea econo budget. Admonishing them for living well because they earn a good income is just dumb. Yet they are not RICH. The common perception is the 1% is swimming in gold coins, like Scrooge-McDuck, which is simply not true. And THAT deserves some perspective for all these petty envious 99% with a robin-hood mentality, and especially for your starving writer audience. For perspective, I’d argue poor people in the US have a great standard of living comparison to the world population. They are in the top 1% of the planet. So maybe the US poor should also “shut the fuck up” in public also? My point: This kinda rant is what is wrong about discussing anything related to wealth or income. It’s jealousy, self-righteousness and anger cloaked in pseudo-enlightenment with a dash of mob-mentality pitch-fork waving. That’s a stew which offends my 10%er palette.

  139. > the places in America where the cost of living is Astronomically High are blue states with big government, high taxes and burdensome regulation

    I only have direct personal experience with two of these: the SF Bay area, and Manhattan.

    In the SF Bay area, the cost of living is astronomically high in part because of CA’s taxes, but primarily because the price of land is astronomically high.

    Why is the price of land astronomically high? The confluence of three things: (a) political pressure from the people who are already living there to not increase density; (b) the existence of the bay and the hills which hem the populated area into a ring around the bay; (c) the fact that the economy is doing better than most of the nation, and so people want to move there. [Note that while parts of California got absolutely whalloped by the recession, the inner core around the SF Bay wasn’t one of them.]

    In Manhattan, the cost of living is astronomically high, again, largely because of the price of land, which is kept high because (a) there’s significant political resistance to higher density (it’s already the densest place in the country) and (b) the available jobs on manhattan so outstrip the population that there’s always demand for housing.

    (There’s also the problem that everything is imported to the island. Food, in particular, comes from really far away, because there’s nowhere to grow it nearby, because so many people want to live here …)

    Both of which examples go a long way towards undermining the implication that cost of living is astronomically high as a result of big government, high taxes, and regulation. My experience is that (relatively) high population density causes a high cost of living, and that high population density causes big government with regulation -> they are correlated and they both arise from the same cause, but they aren’t causal vis-a-vis one another.

  140. @ Kilroy, To those complaining about the 1% and the taxes they don’t pay: you wouldn’t be complaining if you suddenly started making more money and jumped into that group.

    I am in the 1%. I damn well think I should be taxed more. In fact, I don’t take my standard deduction — or a number of other deductions — because the federal government needs that money more than I do. So stop generalizing.

  141. Well, between Scorpius, Kilroy, and now Surfwax’s (and presumably Brad assuming he’s not posting as one of them) straw-man arguments on envy and a non-existent sense of entitlement, it’s obvious this will only continue to go downhill. Ah well, maybe we should just leave them to their egos.

  142. Surfwax, that is a complete strawman. The issue is not that people can’t complain, but that people who are in the top (insert x% of the income split) shouldn’t expect to complain because they can’t live like they’re in the top 0.1% (or whatever).

    Part of the problem, at least as I see it, are people expecting to be able to spend on anything they like without really paying any damn attention to their actual income. If you want to do that, you’d better have a LOT more money than $200,000 a year.

    But if you do have $200,000 a year, and you can’t make ends meet, you’re doing something wrong. Yes, you might have things you want to prioritize spending on (kids education etc…) but it’s about being prudent and not being an idiot.

  143. The point is also, I think, that someone who is “spending a fortune on artisanal cheeses” every time he hosts a party really ought to be more grateful than he seems to be that he doesn’t have to worry about getting enough food to eat every week. Or, for that matter, grateful for the luxury of having artisanal cheese.

  144. I don’t resent the fact that the guy has so much more money than me but complaining about those kinds of “problems” openly like that is just so shallow and gross.

  145. Steve Forbes proposed a flat tax back during his presidential run in the ’96 Republican primaries that could be completed on a notecard by anyone; he got pilloried by the mainstream media and the professional left (but I repeat myself) because it was “unfair”. It isn’t just the corporations and the old-money wealth that benefit from the distortions of a extremely complex and opaque tax code, it is also the Hollywood and Silicon Valley left that bought tax deductions and highly specific loopholes to benefit themselves. It really is time, IMO, to tear down the tax code and simplify it tremendously.

    I had to laugh at Haynes’s $800 a month wine expense; I don’t necessarily think he’s an alcoholic because he could do alot of entertaining with clients and friends (as a sales manager, I would imagine he does alot of entertaining), plus the article doesn’t doesn’t mention a girlfriend or anything like that; he could be popping corks with a lady friend (or guy friend if he swings that way) every night to lubricate the festivities to commence later.

    I tend to think the 1st couple is really shortsighted not only because of their spending habits, but the fact they freely admit to not putting anything away for retirement. They’re only 20-25 years from retirement age; what do they expect to live on, Old Age Pension and prayer?? Yeesh.

  146. Whenever I read an article like this one, I want to offer to trade. This is clearly coming from a complete lack of perspective. This guy is comparing himself to people who make even more than he does, when, if he compared himself to people in my income bracket, he’d feel positively rolling in wealth. The very first time his choice was between granite countertops or a status symbol car, why, compared to making the car payment late (for a used beater that may last another year) or putting off a doctor’s appointment to have that rattling in the lungs looked at, he’d feel positively opulent.

    I do not consider myself poor, but I nearly disowned a friend who comes from money when she fussed at me for being “obsessed” with it. At my income level, one does not have the luxury of not watching every penny in the bank account, and making sure it wasn’t spent on something else. It’s a constant balancing act.

    I work in human services, helping people who have intellectual disabilities get and keep jobs. Most of them can work about 25 hours a week, tops, before the effort wears them out. You wanna see how it looks to scrape by, take a look at their budgets. That many of them take vacations and can afford flat screen TVs and X-Boxes is a testament to their staff’s knowledge about budgeting and saving, and that they’re disciplined enough to live off $25/week of spending money.

  147. I used to complain about those people that cut ahead in traffic and wait until the last second to merge instead of waiting in line like the rest of us. I’d get really close to the car ahead of me so that those people couldn’t merge in and maybe they’d miss the exit. After venting one day, a friend asked if I hated them for doing it, or if I just hated that I wasn’t it. Now I just blow past people and cut in at the last second. Saves me a good 4 or 5 minutes each way every day. I’m a much happier person. And no, I don’t care about the 99% that wait in line and have to touch their brakes because of my late merging, I just feel sorry for them for not realizing they can get out of line anytime they feel like it.

  148. Unholyguy:

    “Your life experiences are pretty meaningless here”

    Oh, really? Which life experiences are these, Unholyguy? The ones where I actually went to an elite high school and university? The experiences of working in a technology company where a significant number of people I know personally became millionaires via stock (I let before I became a stock millionaire; I only got a house)? The ones where I made a consistent six figure salary consulting for technology and financial services industries? The ones where I have had jobs in the publishing, online and video games industries despite living in rural Ohio? All of these, incidentally, prior to the publication of Old Man’s War in 2005.

    Yes, I really like people who apparently think I’ve only done one thing in my life telling me that my life experiences don’t count when we’re talking about issues of wealth.

    Let me rephrase my statement for you, Unholyguy: In my considerable and varied life experience, which is rather on point for this discussion, you’ve offered up some pretty terrible advice, especially in regards to my current line of work, but also in general otherwise. And unless you want to actually detail why your advice on this matter is somewhat more relevant than my own, I’m going to cast doubt on whether you know what you’re talking about in this regard. Doing a monkey show for status is a different thing than doing what is comfortable for a financially comfortable life. The two can overlap, but it’s not required for them to do so.

  149. Thanks Toronto Life, for giving the rest of Canada yet another reason to hate Toronto and bash Torontonians (most of whom aren’t scraping by on $200,000 per year…).

    Ignoring the sad, sad commentary about people with $800 per month wine bills, I can offer some guarded agreement on the high cost of living in Toronto. Property values in Toronto are over-inflated and often excrutiatingly high for what you actually get in square-footage and home quality, particularly for people looking for a first home. Your choice is to pay the freight or suffer exile to distant suburbia (close suburbia is also very expensive) and trade off a painfully long commute for space and a reasonable mortgage.

    Property taxes are high and going higher, service fees are popping up on everything from higher library fines to garbage collection, water/sewage rates are rising faster than a flooded basement, and parking costs are, well, insane. The transit ssytem, though good, is overcrowded, underfunded and unable to grow due to lack of funding. The current mayor operates like a Cold War Bulgarian potentate, is constantly at odds with City councillers, the media and everyone who even slightly disagrees with him.

    And lastly the cost of getting ice time for pick-up hockey at the local rink is up again.

    On the bright side, beer is still affordable.

  150. @Daveon: “But if you do have $200,000 a year, and you can’t make ends meet, you’re doing something wrong”

    The problem is, people take their current situation, and multiply it up, and think all the extra money will go to spending money. But that’s not usually how it works – your expenses typically skyrocket when you move to an area where you can find six-digit jobs, and your taxes explode as well. I could do much better living in Fresno with a bought-for house on $50k a year than I could renting some overpriced apartment in the Bay Area on $200k/year.

  151. Does anyone else notice a particular phrase popping up at what appears to be a more than random coincidence?
    “1% is swimming in gold coins, like Scrooge-McDuck”
    Do these posters all have the same press agent?

  152. @ Unholyguy – those red states like Arkansas, Montana, New Hampshire etc also tend to have less government but still manage to make sure public health and safety are being regulated and complied with. They don’t tend to have multiple state and local government agencies with overlapping jurisdictions and redundancy that creates a situation where nobody is sure who is responsible for oversight/regulation for particular issues but fight tooth and nail in the state legislature to expand their budgetary fiefdom. And the last time I looked, it was unconstitutional to prevent people and businesses from relocating to more friendly business climates; so California, MA, NY et all are really going to have to look at how much regulation and oversight they already have versus scaling back to something cost effective and durable.

  153. I live in Toronto. I have an ok income. Not top 1%, but well above a poverty level. We have our friends over for dinner, and enjoy their company. No-one impresses anyone else, we just relax and share good food. Our wine budget is about $50 a month — enough for a few bottles of good cheap Argentinian or Australian stuff, or sake. If I’m in the mood for artisanal cheese, I know the stores in Kensington Market or St Lawrence Market where you can get the good stuff at affordable prices. Our house is worth a small fortune because we bought it years ago, when it wasn’t worth much of anything. We’re happy and living a comfortable life. We’re not impressing anyone, but then again, who wants to?

    I can’t imagine WANTING to spend $1,000 a month — or $1,000 a year — on clothing. You really want to spend that much time in clothing stores? Yuck.

    Our kids go to public schools. We have two cars but the “new” one is a 2004. And we won’t be replacing it until it starts to cost too much to repair, which is years in the future.

    You don’t actually need to earn more than we do — it is almost like the additional income carries with it some sort of weird obligation to spend ostentatiously.

    Oh — our house does have a new kitchen. And it has granite countertops. The new kitchen replaced the house’s non-functional 1954 original. Most of the cost of the renovation was replacing the wiring and plumbing and crooked floors. Once we’re doing that, why not spend a little extra for nicer counters, eh? No-one will notice the added little frill.

  154. Madlib: I said it first and am expecting $1 from each followup commentator using it. But doesn’t everybody picture Scrooge McDuck swimming in his vault when they think of the 1%ers? I mean a lot of us are in the age group growing up in the 80s when duck tales was big.

  155. Even really fancy food is pretty cheap if you cook it yourself. A take-out pizza from Pete’s Apizza will set me back more than a two-pound sirloin from Whole Foods, even including a really nice (~$16) bottle of wine. I can make a fabulous shrimp-and-andouille gumbo that will serve six foir less than $20.

  156. I don’t care about your tax rate or about your income, but if — as one wag put it — “you spend money you don’t have, on things you don’t need, to impress people you don’t like” things can get tight in a hurry.

  158. @ Deano, not to snark too much, but compared to his predecessor, the current mayor of Toronto is at least confronting the issue rather than closing his eyes and pretending the problem can be solved by more taxes. I used to date a lady from the Mississauga area and would rather have lived in that area rather than pay a fortune just to have a trendy address; it’s pretty decent suburbia, in my opinion :)

  159. > A take-out pizza from Pete’s Apizza will set me back more than a two-pound sirloin from Whole Foods, even including a really nice (~$16) bottle of wine. I can make a fabulous shrimp-and-andouille gumbo that will serve six foir less than $20.

    That may vary from where you live. A takeout pizza would cost me less than a two-pound sirloin from Whole Foods, for example. But part of that is because organic, grass-fed beef – itself something of a luxury good – is one of the foods whose Manhattan price is utterly detached from what you’d expect to pay anywhere else.

  161. @shakauvm

    I could do much better living in Fresno with a bought-for house on $50k a year than I could renting some overpriced apartment in the Bay Area on $200k/year.

    Assuming no special deductions, a $200K/yr gross salary in CA has an after tax take home of approximately $9184 vs $3042 for $50K. That would have to be one hell of an apartment.

  162. Christopher, *anybody* would look more fiscally-aware than ex-mayor David Miller… specifically includiing Dubya Bush. Being better than him is not a high accolade, it’s like being less evil than Attilla the Hun.

    Mayor Ford’s daft with money too, just in different ways; trying to cut small expenses in operating costs while proposing billions he doesn’t have to build subways that just aren’t economically justified and that his own transit commission doesn’t want, for example.

    My folks have retired to Mississauga and quite like it there; it’s very pleasant to visit, and their condo is huge compared to what they could get in T.O. for the same cost…. but they live within their means, and are probably grousing about this idiot article right now. I’ll have to ask ’em about it.

    — Steve

  163. @Erik, it’s perfectly possible to spend $4500 on renting a relatively modest place in the Bay Area – having 50% of your income go on renting is quite a lot. That said, I don’t see much on Zillow or Redfin under $1,000,000 in the Bay Area to buy either. A friend just bought somewhere in Vajaho for $200,000… but that’s a hell of a commute to the city or the Bay.

  164. Kilroy says: February 17, 2012 at 1:38 pm
    Jesse: I just don’t understand all the hate for the successful.

    I don’t hate the successful. But an article which talks about how hard it is to get by, while showcasing five people who don’t know how to manage their money? A quick glance at each profile, and I can find places where they’re throwing money away, and I’m not a financial adviser. Somebody who really knows how to fix a budget could probably clean up all their problems – if they were willing to actually change how they lived.

    I can complain about that – because this article is effectively picking rich people with broken legs and saying how hard the rich have it because these people can’t play kickball or run a marathon next week.

    Kilroy says: February 17, 2012 at 2:00 pm
    The 1% get to spend money to try to convince the 99% to support politicians that will enact legislation beneficial to the 1%. But the 1% still have just 1% of the vote.

    Or, they could just buy the politician after the election. Really, why make life harder than it is?

  165. Vallejo is a pretty distant commute from most jobs in the bay area … plus, the school district is mediocre and the local government filed for bankruptcy.

  166. Or, they could just buy the politician after the election. Really, why make life harder than it is?

    Or as Jon Stewart put it. The poor have really crappy lobbyists.

  167. Peter:

    why complain that the rich are spending their money? One person is complaining that the rich don’t spend their money and instead keep it in banks and non-economic developing funds, now you are complaining that they do spend their money, but don’t spend it wise enough. Can we at least be consistent? Who cares how they are spending their money as long as they are spending it. Right? trickle down, trickle down…

    as to the politicians: because bribery is illegal and buying ads is not? The rich usually aren’t stupid enough to commit crimes when they don’t have to.

  168. So do you think all this money is just sitting in huge vaults ala Scrooge McDuck and the 1% are taking afternoon swims in gold coins? Rich people don’t keep their money in bank accounts. Their money is invested in stocks and bonds and property and other areas that make this country work.

    Yet, while they accumulate more and more of that wealth, the real wages of everyone else have been stagnating for the past 10 years, and we’ve had a crisis that knocked a tenth of the workforce into unemployment, and efforts to help them out a little are answered with “the country is broke” while taxes for those rich folks are lower than they’ve been in 50 years.

    So the question arises: if the country is working, who is it working for?

    Personally, I’m doing all right. I’m not top 1% but I’m top 20%. I have no particular desire to be vastly richer than I am; it doesn’t sound like fun. But, unlike some people in the top 20%, most of the people I know aren’t. In some cases, very much aren’t. And they’re mostly scraping by paycheck to paycheck if they get a paycheck at all.

    It’s true that by global median standards they’re all as rich as kings, but it only really makes sense for them to shut up about it if somehow the general prosperity of our society arises from its high level of inequality. That’s a story I’ve heard time and again, that we’ve simply made a tradeoff in which we sacrifice equality of outcome to make everyone better off. But there’s little or no evidence that it’s true. We certainly haven’t benefited from the recent increase in inequality.

  169. why complain that the rich are spending their money?

    Kilroy – there are two issues being discussed here.

    What the super super rich do with their money and associated wealth concentration which does not really contribute to the economy. I have a serious problem with that because it breaks the fundamental systems that have made us all better off over the years. And economically unequal societies with an over class tend to be unstable over the long term.

    And… moderately rich/well off people complaining they can’t make ends meet because they are spending money they don’t have. A situation to which most of the people here don’t have a lot of sympathy for.

  170. Kilroy,

    You’re either trolling or not paying attention. The issue isn’t that these people are very well off. It’s not how they spend their money or even if they do. The issue that rankles is that these people are spending their money on a lot of things that they don’t need and complaining about how hard it is to get by. The operative part of that sentence is bolded. If they want to blow every cent they have every month and end up barely making it to the next pay period that’s FINE. What’s not fine is to complain about how hard they have it when they could, in fact, adjust their spending and not have to ‘scrimp’.

  171. I’ve got boatloads of envy for the 1%, these days.

    I’ve got envy for anyone who doesn’t spend windy, rainy nights awake, worrying that this time the roof really will fall in; who has more than one vehicle for the household; whose vehicle(s) are less than 21 years old; who hasn’t spent more of the last two years laid off, than working; who doesn’t worry that s/he will come home to smoking embers because there is an electrical short in the kitchen and the built-in microwave that came with the house keeps turning itself on and off; who can afford to replace appliances that are mostly broken; or can turn up the heat when the temperature drops, instead of adding gloves and a scarf to the sweaters and socks.

    I envy what the 1% eat, and that they can afford something other than pinto beans and rice, again, day five, six, and seventy, of a painfully foreseeable future of beans and rice, because w/o health insurance, my prescriptions mean that we buy pills instead of food, and w/o my prescriptions I can’t work, and if I can’t work we lose the house.

    Ja, sure, I have envy. You betcha. And I’m pissed off about it, too. Articles like the one referenced in this post make me want to punch somebody in the throat. I have done everything right, just like the guidance counselors advised: I got good grades, won scholarships for a top tier college, graduated toward the top of my class, worked hard, budgeted, saved, invested in a reasonably priced home in a marginal neighborhood. I’ve dealt with my gender, my race, my class, my orientation, and my disabilities, and I still can’t get a damn break.

    I am deeply, existentially angry, and if I had a “goddamned revolution” button, I’d be leaning on it.

  172. Daveon: Careful; percentages are tricky. The person paying 50% of his $9000 take-home salary on rent still has $4500 to spend on everything else he needs to live. The person paying 30% of his $3000 take-home salary on rent has only $2100 left.

  173. Rickg: see Daveon. Daveon: See rickg.

    My issue still remains: why do you get so angry about what someone else complains about? How does their complaining affect you? It isn’t like these people sought out the magazine writer and begged to tell their story of woe. I don’t see their complaining as any worse as your complaining about their complaining. After all, no one approached you and asked for you to comment here, unless they did, which is impressive.

  174. Kilroy says: February 17, 2012 at 3:39 pm
    Peter: why complain that the rich are spending their money? One person is complaining that the rich don’t spend their money and instead keep it in banks and non-economic developing funds, now you are complaining that they do spend their money, but don’t spend it wise enough. Can we at least be consistent?

    Excuse me while I try to make sense of this. Are you asking me to match stories with everybody else before commenting? In case it’s escaped your awareness, I am an individual. I don’t have to follow a party line simply because one exists, and I certainly don’t have to follow one because you demand that I follow the party line that you imagine exists. Furthermore, my point was that the article is a skewed way of trying to garner sympathy for the 1% by showing five straw-man examples of how tough the 1% can have it.

    Who cares how they are spending their money as long as they are spending it. Right? trickle down, trickle down…

    Personally, I prefer the “trickle up” theory, which says that when I spend money, some small percent of it goes to the people who own the company, but most of it goes to the company’s suppliers and employees. The suppliers and employees spend money, some small percent of that goes to the people who own the companies they buy from, repeat. The rich still have growth. And so do the poor.

    Compared with the “trickle-down” theory, which seems to depend on money magically coming down, instead of what really happens, “trickle-up” seems more believable, although as far as I know it’s untested – unlike “trickle-down,” which has been tested, and doesn’t seem to work based on what I’ve seen of the trial.

    as to the politicians: because bribery is illegal and buying ads is not? The rich usually aren’t stupid enough to commit crimes when they don’t have to.

    Bribery is illegal. Contributing to the re-election fund, however, is not.

  175. I’m kinda good with the whole fire thing, myself. Not from any irate-villagers-with-torches-&-hoes sense of righteous indignation, but because I am continually startled by the utter let-them-eat-cake lack of perspecive that allows these entitled clowns to enumerate these wholly fictive woes without a shred of understanding that such imaginary problems aren’t even within the grasp of the vast majority.

    Is the crab-pot climb to such material consumer-zombie competition so incremental that they really can’t remember what it was like to have to decide between paying your gas bill or your phone bill? Is there anyone who was genuinely poor whose pulse fails to quicken when store coupons show a fantastic deal? And if so, how do you utterly forget that there is a vast ocean of people who continue to feel this way, and that you were one of them?

    I honest wonder if this artificial competition among gated community dwellers (wholly abetted by the vested interests of our corporate oligarchy) exists not out of ignorance but as a willful walled garden built to continually prove that they are indeed on the other side of such mundane and pitiful concerns.

    In which case it is very hard to have the smallest shred of sympathy, and so I am down with the whole Molotov cocktail party.

  176. My old economics professor started the first class by stating that you could line up every economist in a row and you still wouldn’t reach a conclusion. Trickle-down, trickle-up, trickle all over the lawn, what works is still based on whose viewpoint you are lookng from.

    I don’t think the article was looking to get sympathy for the 1%. But it does show that no matter how much you make, you still end up spending it unless you are among the .1%.

    No, I don’t expect you to agree with every single commentator before you, but you can at least admit that the complaints are contrary, demonstrating that everyone will never be happy at the same time and that this really comes down to envy.

    Contributing to the re-election fund does not buy a politician in the strict sense.

  177. I don’t understand. Seriously, I cannot comprehend: unable to make ends meet on $200,000.00 per year? My husband and I live on less than $2,000.00 per month. We are not uncomfortable; but still, from my perspective, anyone making more than $30k per year is rich.

    Am I angry about this? Only in that those people wasting their $200k on wine and beach houses are spending all that money on themselves instead of saving, oh, starving children across the nation or paying for cleft palate surgeries in India.

  178. My issue still remains: why do you get so angry about what someone else complains about? How does their complaining affect you?

    Kilroy, when their complaints are being used as grounds to argue that the rich need another tax cut to get by (implying that the government either run up higher deficits or deliver fewer services) they do affect me as a 50%er… and they affect the bottom third of earners even more than me

    Also, it does rub me raw to see people who have money and no clue how to put it to good use, while the punditry quack on about how the rich obviously have superior knowledge of fiscal management and therefor us lower classes should just shut up and do as we’re told.

    — Steve

  179. Feels like 99% of the people on here are against me. At least now I know what it must be like to be rich.

  181. @John

    I don’t much like the status show. I don’t think it is necessary for a comfortable life. In Silicon Valley is is not even necessary to get filthy rich but we are the exception not the rule, and even here it helps.

    I don’t approve of the whole thing. But I am not going to argue that is isn’t a GOOD INVESTMENT, which is what I seem to hear you doing. Contacts, network, school, clothes, parties, is the wine good enough, what are the neighbors saying about the cheese, all that superficial stuff actually does matter.

    For many people it actually is a good investment, it pays out, it’s not just being stupid and irresponsible with their money. Humans are stupid monkeys, status matters a lot to them.

    As far as your experiences go, it is seems to be that based on your chosen career and your current choice of location that this stuff does not matter to you, nor is it essential to your success in your field, you have chosen a different route. However other people have different realities they live in, you should not judge them strictly by your own experiences.

    My own background; extended family of rich DC lawyers tht can trace their line back to the Mayflower. We were the black sheep of the clan, no good schools for me, worked my way up the hard way through public education. in the midwest.

    When I compare the type of difficulties I had to overcome to the easy success my Harvard educated cousins have enjoyed it’s quite obvious to me that the investments my uncles and aunts made in the cheese plates and Mercedes did in fact pay off. Similarly, working my way up Silicon Valley to the point where my kid goes to school alongside the elite, again, the shit they do works. So many of those people pull down so much money just by being part of the right old boys club. Not my path, but I won’t argue with success when I see it.

  182. Kilroy, sorry your strawman of accusing anyone not in the 1% of being just jealous doesn’t fly. It’s not jealousy if it’s not wanting a better car, it’s needing any type of car at all to get my sick kid to the doctor and me to my job because the bus doesn’t run for second shift workers. There is a world of difference between want and need. Although I personally am not in that boat, there are plenty of people who are.

  183. The thing that immediately jumped out at me is that these people complaining about their expenses… were all spending approxmately 12%-15% of their income on mortgage. Compared to the 25%-50% that most people spend on rent or mortgage (usually for places that aren’t nearly as nice), since basic housing costs eat up a large portion of the income of someone NOT making $160K-$200K/year.

    Someone who can’t manage their income when they’re only spending 12%-15% of it on housing… really IS someone who can’t manage their income!

  184. My issue still remains: why do you get so angry about what someone else complains about?

    Oh, this isn’t angry. This is me with a proposal to write finding things to do that aren’t quite as hard while my back brain processes the data I’m going to write later.

    I do get angry about the concept of “trickle down” economics because every single empirical way we have of measuring that, has shown that it’s done nothing other than transfer huge amounts of wealth from the less well off to the already very well off, with nothing to show for it in terms of incomes or the state of the US. I

    How does their complaining affect you?

    Never said it does. Unless, and this is very important, they are thinking that means they’re paying too much tax.

    I get equally annoyed when a man making $20M a year pays 15% in tax, and says the problem with the tax code is it isn’t broad enough. That does affect me because in all likelyhood I will end up paying more tax, and he’ll still be paying 15%.

  185. Kilroy:

    Oh, stop it with the I’M A CONSERVATIVE, THEREFORE I’M A VICTIM shtick. You only make yourself look like a fool.

  186. Mad Lib: What strawman? You say it isn’t about jealously, but your very next sentence is about people wanting/needing more money. You want more money? Go out and make more money. Nothing is stopping you but yourself.

  187. Go out and make more money.

    Deal. I’ll make more money this year. And you agree that we both should pay more taxes on it.

    Deal?

  188. This “everybody else is just jealous” meme is pretty annoying.

    My mother married into the top 1-2% (I’m not entirely sure what her husband’s income is) for US income. I lived in that household for 4 years (during high school). I know how she lives. I know how her neighbors live. I know how her country club works.

    I didn’t like it. Being around people who are that fashion-conscious, spoiled, and judgemental (“oh my God, can you believe she’s wearing jeans in public?!”)* is pretty miserable. It was like the kids didn’t even know how to have fun without expensive toys or breaking into their parents’ wine cellars. What happened to playing release or kick the can or capture the flag? They didn’t know how to get messy–parents bleaching their daughters’ hair from age 5! And my mom was so obsessed with keeping up with appearances (making the house look more like a hotel than a home) that I left most of my stuff at my dad’s house since I wasn’t allowed to bring it over to hers and make it apparent people actually live there. She didn’t like that my novels were on the bookshelf in the room set aside for reading (I think books belong in the living room, but I digress) instead of in my room (only fancy cookbooks by high-profile chefs allowed). By senior year, I really wanted to just move in with dad, where I had friends who I was pretty sure were my friends because they actually liked me and we shared interests (like in the same books and bands).

    * This was the point where I developed a rule saying that only things like a hoodie or a coat could cost over $20. $8 t shirts from local punk and ska bands became the rule, and I argued back when my mom objected to jeans that had developed holes. I didn’t want to be like those people, and I don’t want to be like my mom. Yesterday a skirt I’ve had for 7 years or so got caught in an escalator, and now it has a few new holes. I’ll sew it up, just like I’ve sewn up several other holes in that skirt over the years.

  189. @Daveon
    The three dimensions of bay area property
    – commute
    – cost
    – safety

    Commute + Safety = appreciation (a house is an investment after all)

    If you want to rate high in acommute and safety, for a single family home, you are talking 1million+

    You can move the needle down to the 200K range like Vallejo only by a two hour commute, real risk of crime and no appreciation. In practicability even by taking reasonable heavy hits to commute and safety you are not likely to dip much below 600K. 700K is more reasnble

    4K mortgage
    2K private school

    Means that you start out “owing” $72K /year in the Bay Area to handle basic needs. Which means your first $100K of income is basically gone before you start. $200K is pretty comfortable here (giving you around 60K to handle every other expense in your life, save for college and retirement) but not upper class more like upper-middle. AMT starts to bite hard as well.

  190. Agree that both of us should pay taxes on the more money you make? Knew this would come down to a welfare request.

  191. @Kilroy: These people are being mocked not for being rich, but for whining in print about NOT being rich. While earning 200k. Whining obnoxiously should always be mocked whether it is being done by the rich, the poor, or the undead. Trying to make this about the unwashed 99% having status envy both misses the point & says more about you than it does about anyone else.

  192. Eddie: What does this say about me? That apparently I’m more libertarian than the average Whatever reader? To each his own and live your own life.

  194. “Go out and make more money. Nothing is stopping you but yourself.”

    Absolutely, which is why all wealthy people got that way because they are smart and hardworking and all poor people got that way because they are dumb and lazy!

  195. My wife and I are in the “earning more than $200,000/year” crowd. We live in an expensive part of the world (San Francisco area) and live in a nice house, so we don’t actually have an awful lot of money left over at the end of every month. Earning this sort of money doesn’t actually mean that we have a pool, a pool boy, and a pool for the pool boy (so that he doesn’t get our pool dirty), but…

    I can say with a high degree of confidence that every financial “problem” (and yes, the quotes are deliberate) that we have is due to choices we made. We could live in a cheaper house (we did) or a cheaper area and we don’t want to. We don’t have to crack open a bottle of wine most evenings, but we like wine (luckily we have cheap tastes). We don’t need cable tv or Netflix, but we like it. We don’t need a cleaning service, but they completely rock and everyone should have one.

    You don’t have money problems just because you can’t easily live the lifestyle you want to. That’s not how it works. You have money problems when making ends meet is a genuine challenge – not when you have to downsize your annual vacation.

    Jeez, sometimes people just tick me off.

  196. Kilroy @ 2:56 pm:

    I used to complain about those people that cut ahead in traffic and wait until the last second to merge instead of waiting in line like the rest of us. I’d get really close to the car ahead of me so that those people couldn’t merge in and maybe they’d miss the exit. After venting one day, a friend asked if I hated them for doing it, or if I just hated that I wasn’t it. Now I just blow past people and cut in at the last second. Saves me a good 4 or 5 minutes each way every day. I’m a much happier person. And no, I don’t care about the 99% that wait in line and have to touch their brakes because of my late merging, I just feel sorry for them for not realizing they can get out of line anytime they feel like it.

    I don’t feel sorry for the 99% of people who wait in line. I feel sorry for you for being so amoral that you think it’s okay to gloat about your antisocial behavior.

    Likewise, Jonathan Kay’s essay doesn’t make me feel anger. It makes me feel pity. I pity anyone who could be that clueless in public. But mainly I pity him because no matter how much money he has, it’s never going to be enough for him.

    I still remember the day in second grade when we learned about the difference between needs and wants. My teacher said “wants are endless, but our ability to meet them is limited.” Perhaps Mr. Kay wasn’t paying attention when his second-grade teacher gave that lesson.

  197. Kilroy: You are saying that the bad blood towards the 1% is simple class envy. What could I do to convince you that I don’t care what the 1% do with their money until it negatively impacts my personal ability to better myself, and whining about the inability to make ends meet on an income that dwarfs what most people make is poor form at best? Stop calling them on it? So far, your responses have been disingenuous, leaning towards trolldom.

  198. Everyone has money problems, just to varying degrees. even the ultra rich have problems brought about by money, they just are a lot more around being able to trust other people.

    It’s not correct to compare the type of problems we1%’ers have to the types of problems someone scraping by on minimum wage has. Their problems are a lot, lot worse. Tax me more, help them, I’m ok with that. That doesn’t however mean that my problems do not legitimately cause me stress or that I am not allowed to blow off steam about them or that I must pretend like they do not exist. My problems are much more around what to invest in (better school for the kid vs safer neighborhood for the wife? Commute less, more time with kid, pay more, take a risk on startup, but then how to make the mortgage?) but they are still real enough to me and not a total whine fest.

    Similarly, even most poor Americans are better off then homeless Americans. Most homeless Americans are better off then people in other parts of the world. It’s all a matter of degrees. It’s a bit disingenuous to draw arbitrary lines and then make binary statements, everyone above this line is whining, everyone below it is legit. The media seems to be getting a kick out of doing this kind of thing lately though, I don’t think it’s really healthy to anyone to feed it.

  199. I think we passed the “Do not feed the trolls” sign several cages back, and are now well within the trollarium proper.

  202. Kevin — that was my thought, too.

    My husband and I are near the 1% boundary, but not quite over it. We live in the Bay Area, so have not yet been able to save enough money to afford a house (given the high cost of housing here). This does indeed make me sad.

    But I would not be clueless enough to expect sympathy from somebody who’s worrying that their old clunker of a car is going to die, and they’re going to have to spend money they don’t really have to get another equally bad clunker (which is all they can afford).

    And I would hope the person in that situation would not be clueless enough to expect sympathy from somebody who has no access to clean water, and can’t even get enough to eat most days.

    This is simple human decency. And I fully support changing the game such that I pay more in taxes, and in return, we decrease the inequality — locally, nationally, globally — that makes it so one person complains about not being able to afford granite countertops because they spent too much on wine, while another complains about starving to death. We’ll never get rid of it all, but we could make it a lot better than it is right now.

  203. We don’t need a cleaning service, but they completely rock and everyone should have one.

    This is full of truth.

    First thing to go when we scale back, first thing to come back when we got money again.

  204. Likely nobody is going to read this comment because it is so far down the list, but I feel compelled to point out that this article was inconsistent on the top 1% of income. It said 196k is the top 1% of an individual income. And all the stories are about household income below that. And yes, they’re annoying people, but they aren’t in the top 1%.

    “An income of $196,000 places you in the country’s top one per cent of earners.”

    (I get that magazine because it has awesome 2 for 1 coupons)

  205. Actually, I’m pretty glad my son is in the top 1%–he can take care of us in our dotage.

  206. Kilroy says: February 17, 2012 at 4:10 pm
    My old economics professor started the first class by stating that you could line up every economist in a row and you still wouldn’t reach a conclusion. Trickle-down, trickle-up, trickle all over the lawn, what works is still based on whose viewpoint you are looking from.

    Then let me explain my viewpoint, because I think you don’t know where I’m coming from. I think that progressive taxation is good for America. Not me specifically; not the poor; not the rich. Everybody. As far as I can tell, based on what’s been going on for nearly a decade, the current system is good only for the rich. I’d prefer the system Ronald Reagan had circa 1985 as a starting point – not because I think it was right, but because I think it’s better than what we have now. From there, we can adjust up or down as necessary, but if the system doesn’t work for everybody, then eventually it’s going to suck for everybody.

    And I’m not saying this as an economist. I’m saying this from the view that things aren’t working for everybody, and that trickle-down never worked for everybody. America has fiddled with this idea for roughly thirty years, and it has been good for the upper end of the economic spectrum, and that’s it.

    I don’t think the article was looking to get sympathy for the 1%. But it does show that no matter how much you make, you still end up spending it unless you are among the .1%.

    Subheader for the article: “An income of $196,000 places you in the country’s top one per cent of earners. But does it make you wealthy?”

    From the article:
    “That’s no small amount of money, but hardly the means for a life of leisure.”
    “They’re all comfortable, but no one is living large.”

    Perhaps sympathy isn’t the word, but it’s trying to paint them as no better off than the rest of us. And yet, one of the people profiled is leasing a car (a losing deal – better to buy a car that’ll last seven to ten years), another buys a new car so often that they might as well be leasing it (even worse), another talks of $11 bottles of wine as if that’s the low end for wine, another spends $1,000.00 per month on clothing, and the last spends $1,600 per month on food for a family of four. If that isn’t “living large,” it’s only because Mr. Kay doesn’t know what living small looks like.

    No, I don’t expect you to agree with every single commentator before you, but you can at least admit that the complaints are contrary, demonstrating that everyone will never be happy at the same time and that this really comes down to envy.

    No, I can’t. Because you’re comparing commentary on people who do have cash after living expenses with commentary on people who should have cash after living expenses.

  207. “We don’t need a cleaning service, but they completely rock and everyone should have one.”

    absolfreaking lutely, that is true luxury there, best $80/month I can ever spend. Also the first thing to go if someone gets laid off.

  208. best $80/month

    In the BAY AREA? (!) Wow.

    We’re paying $270 a month, considerably further north albeit in an expensive city. But I wouldn’t be without it.

  209. Mine only comes twice a month, and it’s friend prices. We have a complex barter arrangement with the local Brazilian community. One element of this Byzantine contract involves me troubleshooting computer problems in Portuguese on a semi regular basis in return for discounted house cleaning. Which is not easy considering I don’t speak any Portuguese . There is also the great “used clothes for free pizza” arrangement, I think half of Brazil is clothed in my sons outgrown clothing at this point. If the zombie apocalypse ever comes my money is on Brazilians.

  210. I remember “Getting By On $100,000 a Year” thirty years ago. It was funny, leavened with some Kafkaesque keeping-up-with-the-Joneses bits, overall very ironic in acknowledging that the protagonist could organize his life in less profligate ways, if he just wasn’t so busy from the job that paid so well.

  211. While we rich must queue for taxis
    How the poor man sneers at us
    Riding on his workman’s ticket
    In his special workers’ bus!

    Flanders and Swann, Ballad for the Rich

  212. You want more money? Go out and make more money. Nothing is stopping you but yourself.

    *facepalm*

  213. Jesus. My household is in the top 10%. We have one kid grown up and independent, one semi-independent (lives with us, works & pays rent), and one in college. No student loans so far, but we’ve taken out a HELOC. We do pretty well. Our eating-out budget is $50 per week for the three of us.

    I had a patient last year who, after suffering a stroke that damaged one arm and a torn rotator cuff that crippled the other arm, was raising her three grandchildren alone. The only one in the household who could drive was the 15-yr-old grandson who’d just gotten his learner’s permit. And a lot of the time the car wasn’t running.

    Compared to that family, and a lot of others I’ve met, not only do we have no financial problems, WE HAVE NEVER HAD ANYTHING THAT WOULD COUNT AS A FINANCIAL PROBLEM. And that includes when we were college students getting weekly government cheese.

  214. I was just about to start my third straight year of being unemployed but a temp assignment in January seems to be shaping up into something potentially permanent. (Knock wood.) Even if they keep me at the temp rate, I can pull down about $28K in a year.

    I lived on unemployment insurance, odd jobs and, in the last resort, the graciousness of my parents for those three years. I will never complain about not having enough money. Ever.

  215. Pretty hard to live on $28K a year. I think my lowest was $15K in 1993. Not very sustainable though, eventually I got sick and almost lost the sight in my right eye.

    You can complain if you want to Sheila, sometimes it helps you get through times like that.

  216. Unholyguy says: February 17, 2012 at 6:49 pm
    Pretty hard to live on $28K a year.

    I ran the numbers so I could figure out what salary to ask for. It came out to roughly $17,000 a year minimum. And I’m not talking about skipping meals anywhere. Insurance would be a problem, but food/clothing/shelter would be covered, as well as my internet service and comic books. (In case you’re wondering, I live on Capitol Hill in Seattle, in a 400 square foot studio.) So, maybe it’s hard to live on $28K a year where you are. But I don’t think you have enough information to judge how it works out anywhere else.

  217. sjw:

    This is in Canada, though; I suspect that income inequality is not quite so bad there as it is in the United States. I could easily be wrong, though.

  218. @Peter, I also live on Capitol Hill and my rent comes in at $28,000 a year…. and based on what we see where we are our rent for a house is pretty low. It might be tech related but I’m struggling to find people who are interested in dev jobs that pay less than $80K… probably more.

    But Seattle has weird salary caps and variations depending on what you do and where you live.

  219. Daveon says: February 17, 2012 at 7:19 pm
    @Peter, I also live on Capitol Hill and my rent comes in at $28,000 a year…

    Based on what you said, you aren’t living by yourself in a 400 square foot studio, either.

  220. @Peter – this is true. Although my 725 square foot 1 bed flat in London cost me over $375,000… :) – it really does depend on what you buy and where.

  221. That article is just disgusting. Nobody needs a $1000 stroller–that is obviously a status purchase. When people feel like $1000 strollers are a “necessity,” we have a serious income inequality problem where people at the top are not spending on things that will actually improve their lives but on things that they hope will one-up their neighbors.

    Meanwhile, you’d be surprised at the values at some subgroups of the wealthy and overeducated. The family headed by a Standard-educated lawyer up the street just retired their minivan when its transmission died after 200,000 miles. It was their “new” car–the other was even older. They buy consignment-store clothes. That family simply doesn’t care about status purchases. They are satisfied with themselves and their values and don’t feel a need to show off to anyone. Where does their money go? I don’t know, but I know they spend over $500/month on piano lessons for the whole family from the best instructor in the area. And holy crap, they are amazing piano players, every one of them.

    My whole neighborhood is like this. I could tell stories about similar families all day. Which is why I love living here.

  222. Kilroy: My old economics professor started the first class by stating that you could line up every economist in a row and you still wouldn’t reach a conclusion.

    This is on par with saying evolution is just a “theory” and therefore my ideas about creationism are just as valid.

    Every economist will tell you that world war 2 pulled the US out of the depression. Every single one of them.

    Most will realize that WW2 was one ginormous stimulus package. And taxes on the top wealthy was in the stratosphere. And this led the US into the boom that was the 1950’s. So, people who don’t like the ramifications of that example will often make a point to try to say it’s all “just a theory”.

    That apparently I’m more libertarian than the average Whatever reader? To each his own and live your own life.

    Except, Congress shall have power to regulate commerce. It’s right there in the constitution, and it means exactly what it says. And you being a libertarian with your “live your own life” philosophy doesn’t change that.

    Now I just blow past people and cut in at the last second. Saves me a good 4 or 5 minutes each way every day. I’m a much happier person. And no, I don’t care about the 99% that wait in line and have to touch their brakes because of my late merging, I just feel sorry for them for not realizing they can get out of line anytime they feel like it.

    I am sure your libertarian political philosophy is based in an excellent fantasy that if everyone acts in a purely selfish interest, that it will result in the best possible outcome for the group, but that is, in fact, libertarian/conservative bullshit attempting to smoke screen what’s really going on. And what’s really going on, as pointed out in a previous post about Bruce Schneier, cooperators act in the group interest, and defectors act in their own selfish interest, to the detriment of the group

    Your actions are to the detriment of the group, and benefit only you. Whatever justification you put on top doesn’t change that simple fact.

  223. “Insurance would be a problem,”

    One thing I learned in 1993 is if you don’t have insurance (in the US) then the thing you are doing is not sustainable. You can get by for a few years, especially when you are young, but eventually, you are going to get hurt or sick. I had a friend that did that and found himself with a $50,000 hospital bill.

    Also you need to plan on extended period of being out of a job. So if you you need 17k/year to make it, you really need to be making 20K so you can deal with the bouts of unemployment.

  224. One thing I learned in 1993 is if you don’t have insurance (in the US) then the thing you are doing is not sustainable. You can get by for a few years, especially when you are young, but eventually, you are going to get hurt or sick. I had a friend that did that and found himself with a $50,000 hospital bill.

    Which is why I keep coming back to Single Payer National Healthcare being a VERY conservative position. You simply cannot run a healthy first world economy when WORKING people are an illness or injury away from bankruptcy. It prevents labour mobility, it prevents experienced people from joining startups, and private insurance just ends up more expensive than it ought to be.

    Our niece is at college in the US (she’s South African) – she has emergency medical cover and went to her doctor with an infection, ended up being sent to ER, got permission from the insurance, who then refused to pay. She’s currently fighting a $7000 bill for ONE ER visit and treatment for a minor infection that needed to be checked out. That’s just insane. She’s fighting it, but her share will still be a 4 figure amount she can’t really afford which we’ll pay. But if she couldn’t, ultimately the tax payer would be stiffed with the bill. All for something that can and should be delivered through general taxation.

    Sorry, off topic, but a real trigger for me.

  225. *
    Aahh, Scrooge McDuck. I love that bastard who’s from a
    comic book and strip, cartoon(s?), and I think movies that
    are aimed at children of all ages.
    Children—.
    It’s a pity that so many adults are child like in that they can’t
    grasp even the basics of “If I do x then y will happen.”
    –
    –
    * When I bookmark some pages in Firefox where I’ve done a
    comment opening that bookmark takes me to wherever I was
    on the page.
    That works here, soO, _partly_ to get back to this place in the
    comments w/out having to remember something like what
    time I last visited? There went the above.

  226. > But if she couldn’t, ultimately the tax payer would be stiffed with the bill. All for something that can and should be delivered through general taxation.

    In California, the voters voted down an initiative to make the state compensate the hospital when people couldn’t pay for services.

    So it’s *the hospital* which foots the bill. Which, of course, drives up costs for everyone else, and drives hospitals out of business.

  228. This, so very this.

    I’ve always been of the opinion that these people would have a much better appreciation of their money of they spent a year or three in the mid-middle to lower middle class, and that politicians should spend a year or three at near poverty level.

  229. When I saw this a few moments ago, I started trying to think of situations where one might legitimately complain about not having enough money while making $200K (or a foreign equivalent). And the only thing I could come up with is medical bills on an enormous scale. Of course, the above individuals live in Canada, where they have universal healthcare of a certain form, which means those making six figures not only get that as part of their tax dollars, but the financial ability to purchase private insurance.

    So I’ve come to the conclusion that there really isn’t a realistic situation where such complaining is justified. Unless cat burglars stole all your money…

  230. I am a SF Bay Area resident in the fringes of the upper mumble-% income range, due to a lot of hard work and working as an IT consultant at a good consulting company.

    I wouldn’t make that much anywhere else. My income level is tied to the job market specifics. It would cost half as much to live in various nice rural places, but I’d make half as much. John, I think the portability of your work – and insensitivity of that to the income level – are extremely unusual in my experience.

    I think people are overstating costs of housing in the SF Bay Area at the moment; my house is underwater a lot from where I bought, and there are lots of decent houses in decent areas in the $200ks and $300ks. There are plenty still at $700k or $1m but you don’t HAVE to live there to live decently in the bay area.

    Even with higher incomes, health issues can be a big deal for family effective wealth or income. My wife is only alive due to a decade-plus of medical treatment that at retail costs more per year than the median US annual income level. We have and always have had insurance, but even so costs that leak around the fringe (and lifestyle impacts that aren’t insurable) are significant, and if I were to lose employer health plan coverage the individual coverage would be a significant fraction of median US annual income level. The direct impact isn’t so bad right now but there’s a certain amount of worry that something could go wrong with that…

  231. I live with a 1%-er from Hong Kong. In his mind, he’s upper middle class, because in HK, he IS upper middle class. It’s kind of like a country that’s bound by the same economics as Manhattan. Yeah, he went to the ultra rich expatriate schools but because he didn’t have his own personal Mercedes and driver and bodyguard, he feels very much middle class. He does not feel like he’s rich, nor does he behave like he’s rich. He shops at Wal-Mart, he’s a bargain-hunter, and he lives dramatically below his means. By American standards, he’s rich. His parents are worth mid-8 figures. But as far as he’s concerned, he’s just a normal guy.

    This is difficult for me to process, sometimes. Our arguments about money are nothing I ever imagined having. He can’t imagine me not having enough money for all my bills, and I can’t imagine him not being able to understand that. He wants to pay for things for me and I refuse. He can’t imagine that, either. Part of it is culture difference, but a lot of it is just have vs. have not. In 6 years, we’ve managed to strike a good balance but the first year or so? It was like we were from different planets.

    What I’m getting at is this: How being one of the 1% effects you DOES depend on where you live. If he’d grown up here, he’d be a VERY different person than he is today. It’s hard for us to judge.

  232. George – I lived in San Mateo County, where the average price hasn’t fallen below $600K. I understand that east of the Oakland Hills, prices have fallen substantially; but the commute to most work sites, from there, is long.

  233. There are a lot of people around Washington DC who have $200k annual incomes (not me, but a number of my friends) and they are actually scraping by – and here’s why:
    A huge number of people in the area are on federal government payrolls, working for defense contractors, acronym agencies, etc. They are mostly double-income families, and they all compete for the same stuff: McMansions, lattes, vehicles, etc. If you assume they have $10k in monthly take-home, at least $4k of that vanishes immediately for the mortgage (any single-family home around here is at least $400k, most are more and the McMansions start at $600k) and utilities. Another $3k goes to childcare (which is shockingly expensive around here for two children) then two cars for two wage earners takes another $1k. We’re at $8k in expenses and haven’t even covered food, maintenance, insurance, gas and travel, entertainment or anything resembling “life” or “fun.” There are little to no savings.

    My point here is: annual income, by itself, is not determinitive of quality of life nor of status in the world nor of being in the 1% category.

    People ought to focus on consumption; that is: the people who are buying $5k televisions, $60k or $100k vehicles, yachts, expensive vacations and other luxuries. Obviously those folks can afford higher taxes and a higher tax on consumption will help curb the most egregious excesses of the entire society. It’s a lot harder to begrudge someone their 83″ 3D television that they have to watch from the next room over because it’s just that huge if you know they paid an extra grand in taxes on it. If they wanted it that bad and paid for it, fine. Let them have it and bully for them.

    Taxing the sweat of a person’s legitimate labor, however, smacks of servitude and decreases motivation to work hard and get ahead. There is no morally or philosophically sound basis for a pre-emptive government claim of a quarter to a third of one’s private work. Mr. Scalzi’s own novels would be barely intelligible if every third or fourth word was confiscated by the feds.

  234. domynoe says: February 17, 2012 at 9:21 pm
    This, so very this.

    I’ve always been of the opinion that these people would have a much better appreciation of their money if they spent a year or three in the mid-middle to lower middle class, and that politicians should spend a year or three at near poverty level.

    I once jokingly suggested that it should be a requirement of the job. All politicians seeking election to the Senate, House, or Presidency must survive one year on a budget that’s 150% of poverty level. All their other assets are still theirs, they just can’t draw on them for food/clothing/shelter needs without giving up the election. Re-certification once every ten years.

  235. Aphrael – My current consulting client is in San Mateo, and I commute about 20 miles across the San Mateo Bridge on a daily basis (and thence down to San Jose once a week or so for the consulting company itself). The immediate east bay (Hayward, Fremont, Newark, Union City, etc) are apparently still down 40%-ish at the moment, and not a terrible commute in to the peninsula, SF (via BART) or South Bay (cough, via 880 8-( ).

    There are several 3 and 4 BR houses on Craigslist for $270k to $315k which appear to be in my neighborhood (no exact address listed, but obviously the same design and years of manufacture, so presumably same subdivision / neighborhood). We don’t have huge lots in this subdivision, but they’re individual houses, it’s near shopping and the police station and all the commute options, etc.

    Peninsula seems less housing-price depressed, but the east bay is reasonable in all ways I care about, is bus-able to the peninsula or BART-able to SF (and will be BART-able to SJ in a few years), and driveable to just about anywhere in reasonable fashion.

  236. KIA: “two cars for two wage earners takes another $1k.”

    Really? In my family, two cars for two wage earners costs us $0 per month. My car has been paid off for the past 7 and a half years, and my wife’s for the last 5.

    “Taxing the sweat of a person’s legitimate labor, however, smacks of servitude and decreases motivation to work hard and get ahead.”

    I would like to hear the name of one person who has really said, “You know, I’m not going to do that extra work, because instead of getting to keep $7000 of the $10000 I earned, I only get to keep $6200.” Just one real person.

  237. KIA writes:

    Taxing the sweat of a person’s legitimate labor, however, smacks of servitude and decreases motivation to work hard and get ahead. There is no morally or philosophically sound basis for a pre-emptive government claim of a quarter to a third of one’s private work. Mr. Scalzi’s own novels would be barely intelligible if every third or fourth word was confiscated by the feds.

    Income is not like words.

    There is an entirely reasonable justification for being taxed by the government (and society writ large):

    Each of us, from the poorest to the richest, benefits from living in a modern western society with certain shared values, infrastructure, social constructs and contracts, etc. I can hop in my car (and will shortly, to go home from work…) and drive anywhere in the US I want to, limited only by gasoline purchases and my own endurance and patience (and road quality, as the car downstairs isn’t off-roadable at all). So can the guy doing janitorial cleanup work in the building here. His kids get free education of decent (but not great) quality level; if they’re really bright the odds are high that, even if he’s working at minimum wage, they will get identified and encouraged and get to go to college somehow. I live in a country where I can negotiate and agree to a contract, and the legal system will actually effectively help enforce it if need be, and because of that people generally don’t break them. I live in a country where the law enforcement system only very rarely frames innocent people. I live in a country where actual barbarism is not tolerated. All of these things are untrue for half or more of the world’s population.

    The taxes I pay are more than the direct benefits I receive, but not more than the benefits I see from living in a civilized nation.

    I am fairly libertarian about individual liberties, but I believe that philosophy is wrong when it retreats into denialism on the value and significance of having a shared civilizing ethos or mythology we all support. Actual uncivilized places, where everyone is out for their own good and there’s no effective shared society, are pretty crappy places to live, a few utopian novels aside. Freedom from government intervention means things like Taliban coalitions shooting schoolteachers and mayors and women with education; it means Somali Pirates squatting on your boat and crew, and your loved ones being held hostage for ransom in Mexico and perhaps cut up and returned one part at a time, if you don’t pay up fast enough.

    It’s not the Washington DC tax, it’s the Civilized Society tax. That’s not to say that everything a government can do or can tax are good ideas, but if your answer is an absolutist no, please feel free to emigrate to Somalia. I’m sure you’ll be happy there, in your bunker…

  238. My lesson of the moment is that wealth is not so much about how much money you have, but how long you have to make that money last. I use the amount $25,000. If you have $25,000, and it’s your weekend spending cash, because you’re going to have ANOTHER $25K to spend next weekend (ref: Mitt Romney), you’re wealthy. If you have $25,000, and you have to live off it for a year: Congratulations, you’re just like the median family in America. Really. If you have $25,000 and you have to make it last the rest of your life, you’d better hope your life-expectancy is under one year.

    Do you have enough money to retire? Given that the typical bank account is returning an amount perilously close to zero, and stock values bounce like bungie jumpers, figure out how many years you plan to live, multiply by $25,000, and compare it to your combined bank account plus home equity. Are you rich? I don’t want to know.

  240. Kilroy wrote: You want more money? Go out and make more money. Nothing is stopping you but yourself.

    WOW! I had no idea it was just THAT SIMPLE! There’s nothing stopping me but myself! Surely not a saturated job market, a global recession, or lack of experience at the job I’m applying for!

    Dude, why are you wasting your time here instead of getting that Nobel Prize you so obviously deserve for solving ALL POVERTY EVERYWHERE?

  241. The bit that made me hit ‘the button’ was where the person said that, in addition to two fancy SUVs, they bought a new Mercedes every three years, with cash. According to Mercedes Benz’s Canada site, those start at over $60,000 CDN.

    Which is to say, they’d free up over $20,000 a year if they somehow made do with a Mercedes that’s older than 3 years. Of course, if they got rid of the third car altogether, they’d save on insurance and parking, too.

  242. I did some math about the “global 1%” figures that are getting thrown around in this thread. Simply put, they do not even come close to passing basic arithmetic tests.

    Even if the entire global 1% were located in the US, which they’re not, they would only account for the top 25% of income-earners. Simply put: the US contains 4.5% of the world’s population. There’s simply no mathematical way for “most of us” to be in the global 1%.

    yrs–
    –Ben

  243. Is this really written by John Scalzi? If so, he must be foaming-mouth-mad, because I found at least two typos!

  244. I will read the whole thread later (243 comments right now), but I just wanted to say Bravo. This will be linked a lot.

  245. You misspelled a word in the last paragraph; it should be “the 1% MUST stop insisting they’re not rich”, not “the 1% most stop insisting they’re not rich”. Other than that, I have no critiques.

  246. Shouldn’t we just be angry at all the lazy members of the 99% that aren’t doing anything to try to change the system to benefit themselves instead? Don’t hate those that have what you want, hate yourself for not doing enough to become what you want to be.

    Killroy, it’s people like you who piss me off. I went to college, tried to get on as a full time teacher, never happened, and it had nothing to do with me not doing enough. And even if I had gotten hired on, I’d be jobless now. Friends of mine became unemployed through no fault of their own. Wtf are you to call hard working people lazy?

  247. If the wealthy 1% want sympathy from me, they can start by trying to live on my budget for six months.

    I’m on the dole in Australia. My partner and I each get about $495 per fortnight to survive on. Our rent is $340 per week. The other $155 per fortnight each is supposed to cover things like food and groceries ($100 per week), plus power, water, gas, petrol for the car, public transport tickets, medication, telecommunications, internet access, clothes, shoes, underwear, socks, textbooks (I’m studying computer science part time to try and improve my employment prospects), medical bills, car registration, car maintenance and so on. Fortunately neither of us drinks or smokes, we don’t have cable television, we have no children or pets, and I’ve managed to replace all the bras which were busy falling to pieces after our last bout of unemployment (I’m an E/F cup with a large band size – if I want a bra which fits and is comfortable, I’m looking at about $80 a pop).

    Even after all of this, we’re still comparatively well off compared to persons in our situation in, for example, the USA. We aren’t likely to get our benefit cut off any time soon (it’ll keep going until one of us is earning enough income to cover the worst of the expenses), and the unemployment benefit comes with a reduction in the cost of health care and medication. If worst comes to worst, we can apply for state housing, and within about three to five years, we’re likely to make our way to the head of the waiting list for a subsidised unit (currently we pay private rent).

    But I’m sorry – I’m looking forward to another year where we may not be able to actually afford to heat the house come winter, where the meals are going to be bulked out with cheap pasta, rice and vegetables to stretch a single bit of gravy beef a bit further, and where the major worry I have this year is whether my clothes and shoes are going to be able to last another turning of the seasons (because I literally can not afford the time or money to replace them if they don’t). Worrying about these things leaves me somewhat unable to sympathise with the woes of the person who is having to put off their purchase of a new granite benchtop for another month because they just can’t afford it right now, and is therefore panicking they’re falling behind the Joneses, the Smythes, and the Wilberforce-Robinsons.

    (PS: if anyone is thinking of offering me “helpful” advice on how to stretch our money even further, please don’t. I’ve heard it, it tends toward “it’s all your own fault anyway”, and unless you’re living in the same suburb of the same city as me – unlikely – you probably don’t have anything new to add to the discussion.)

  248. Benlehman, You get an “F” for your simplistic math from this math teacher. Your horrid calculations rest on the assumptions that wealth is distributed the same around the globe as it is in America. It isn’t.
    Also, Scalzi has pushed people making ~$200k into the 1% when they clearly aren’t (http://motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph); they’re in the 10%. But since Scalzi waves his hands and says “that’s close enough for statistical work” (you get an “F” also, John) we can do the same.

    Anyway you cut it, the 300 million Americans have it much better off than about 6 billion people on the Earth. And certainly the spoiled, tantrum-throwers in the Occupy movement do. Sure, they may have been stupid enough to take out $100K in student loans to pay for an “Ethnic Studies” major giving them a worthless sheepskin, but they still seem to be able to afford iPads, iPhones, laptops, and name brand clothing (which they try to hide under their “hipster” garb)

  249. @scorpious

    Americans constitute 4.5% of the world’s population. Please explain how “most” (51% or more) of them can be in the top 1% of earners. Show your work.

    (Hint: 4.5 / 2 > 1)

    For a bonus exercise, include the populations of Japan, Korea, Europe, Canada, Australia, New Zealand and OPEC.

  250. scorpius@ 1:09 am: Scalzi isn’t pushing people who make $200k anywhere. The claim that making $196k in Canada puts you in the Canadian 1% comes from the essay he’s critiquing, which cites “the latest Statistics Canada numbers”. Your chart from Mother Jones, while interesting, doesn’t actually contradict this, since it’s about income distribution in the U.S. and not in Canada. Your chart does make me skeptical of Jonathan Kay’s claim that a Canadian joins the Canadian 1% with an income of 196k CAD, especially since Kay doesn’t provide a specific source citation, but that doesn’t undermine Scalzi’s main argument, which is that 196k CAD should be plenty to live on.

  251. @Benlehman, let me write carefully so you can understand. If you concentrate a fourth of the world’s wealth in one country with 300 million people you can’t simply compare the income distribution of that country to the world as a whole. You have to “weight” it and take into account “buying power” and fix incomes to certain items.

    Yes, there are many people outside this country that make more than even our 1% but it does not mean that most Americans do not live far better lives than the overwhelming percent of the world population.

    Anyhow, I looked at your link, and you attempt to disprove that the Occupiers are the world 1%. Well, the Occupiers make up a few million folks (and that’s being generous) and that fits easily into your 70 million, grade school-math number.

    But thanks for the laughs. I emailed your little essay (without attribution) to people in my department and they thought it was hilarious. Although, a few of the non-native profs are angry that the American school system can produce a person so bad in math and still graduate them.

  252. Scorpius, the $200k figure comes from Canada (the nation where the article was written, and my home and native land) which has a lower Gini index than the US for income distribution. That really is the beginning of our top 1%, because we haven’t had a concentration of wealth in the upper-upper classes to the same extent as the US.

    http://en.wikipedia.org/wiki/List_of_countries_by_income_equality#Gini_coefficient.2C_after_taxes_and_transfers

    I will point out that the Gini isn’t a genie from a lamp, but if you look at the nations outside the OECD that have high Gini Indices you get some pretty nasty places to live; the orthodox interpretation is that the bigger the disparity between rich and poor is, the more crime you get and the lower the overall standard of living as security costs increasingly eat at disposable income. (Private security, or taxes to cover the added policing, or paying “protection” money… it’s just cheaper to live in a law-abiding society, and it’s easier to abide by the law when you aren’t scrounging for rent-and-food behind armoured Mercedes Benzes.)

    — Steve

  253. And certainly the spoiled, tantrum-throwers in the Occupy movement do. Sure, they may have been stupid enough to take out $100K in student loans to pay for an “Ethnic Studies” major giving them a worthless sheepskin, but they still seem to be able to afford iPads, iPhones, laptops, and name brand clothing (which they try to hide under their “hipster” garb)

    I guess where you live all the Occupyers are college students who’ve realized how screwed they’re going to be when they graduate? Funny, around where I live it’s college students, old folks, parents, and workers.

    You can punch those hippies as hard as you like, but they’re still right about the One-Percenters being a largely predatory class who don’t actually produce anything useful. (They’ve stopped being parasites soley because a smart parasite avoids irritating or endangering the life of its host.) With the ongoing Banking Crisis, I’d say they’ve outlived whatever usefulness they might once have possessed.

  254. @scorpius

    I hope you’re not a math teacher.

    You misunderstand PPP (which is what I assume you mean by “buying power”). Generally speaking, PPP calculation has the effect of giving *more* buying power to people living in poorer countries, because money goes farther there.

    I’m not using PPP calculation for that reason. If I did, it would be worse.

    You also make weird assumptions about my politics. Don’t. This is a relatively simple math question.

    Evaluate the truth of the statement “most Americans are in the global 1%.”
    World Population = 7000 million
    US Population = 312 million

    Note that the relative wealth of America vs. the rest of the world doesn’t really enter into this at all. Let’s assume, for shits and giggles, that America has all the money. All of it. The rest of the world has zero economic output, zero income, and zero wealth.

    America makes up 4.45% of the population of the planet. Relatively simple calculation, yes? (US Population / World Population.)

    The richest 70 million people (aka the global 1%), who all live in America (because remember America has all the money), constitute 22.4% of the American population. Let’s round off and say that they’re the top quintile.

    That’s not “most”

    —

    Now there’s another question, which is about the people involved in Occupy. This is, of course, harder.

    So, even assuming that the US has all the money, basically you have to argue that most Occupy protesters are in the top quintile. You can try to make that argument.

    This has, note, nothing to do with whether or not Occupy people are spoiled tantrum throwers or not. It’s just math, not politics.

  255. While taxation is not the only issue of wealth in the U.S., it is surely the central issue. It seems to me that there is a simple solution. Determine what the basic cost of living (needs, not wants) is for the average American citizen and family. Presumably this is a lot higher than the “poverty level” is currently defined, but a lot lower than where wine becomes an affordable luxury. Make any income up to that level tax-free. Tax any income above that level at the same rate for everyone. Eliminate all loopholes and deductions except children – and maybe charitable donations, but only if charities are required to publish their accounting records for anyone to examine online. Then everyone who pays taxes will be paying the same amount of every dollar earned above that required for the basic cost of living so there will be no diminishing returns on higher earnings. And everyone who pays no taxes will need that money to survive. If you’re making a dollar more than you need to survive, why should you pay any less on that dollar than the second dollar you earn beyond what you need to survive, or the third…ad infinitum.

    So my question is, why does the debate always seems to focus on wrangling over tax cuts and who should pay what rate?

    If the charts are to be believed, the wealthiest Americans are taxed at a lower rate due to shelters and deductions, even though their tax rate is supposedly higher. So a supposedly progressive income tax is in effect actually regressive. A flat income tax sans loopholes should therefore increase government revenue.

    I mean, yeah, people who complain about the burdens of conspicuous consumption are obnoxious, and it’s cathartic to call them out on it, and I’m not criticizing that in and of itself. But shouldn’t there be some talk of how to institute a fair and equitable system amid all the high-octane fiscal rage. Maybe I’m missing meetings, but I encounter a lot more outrage than proposed solutions.

    I want to be clear that I am emphatically not saying that I think no one has substantive solutions beyond up-against-the-wall. I’m just wondering what they are. Also, while I don’t entirely agree with every proposal that has come out of the Occupy Movement, I appreciate that some solid recommendations have come from Occupiers and would like to see more of that from all quarters.

    Sorry if I sound supercilious. Apparently that’s how I sometimes come off (despite best intentions to the contrary) and I’m trying to be conscious of that and not sound condescending.

  256. @ benlehman & scorpius

    This has, note, nothing to do with whether or not Occupy people are spoiled tantrum throwers or not. It’s just math, not politics.

    Side question: why can’t the Occupy movement have both spoiled tantrum throwers and folks that got a raw deal and are actually poor? Also, in what way does the demographic comprising the Occupy Movement effect the validity of it’s arguments?

  257. One thing about the Bay Area—it’s very large and there are thus many possible lifestyles out here. You can go broke on $200,000 or enjoy yourself immensely on $77,000.

    According to the Wall Street Journal “What Percent Are You Calculator” I’m just in the top third of incomes, and according to Realtor.com, some one-family homes (not condoized apartments) near me are available for under $400,000. I commute to the city and back each workday via a combination of the BART and walking and thus don’t need and don’t have a car of any sort. My spouse uses a bicycle, a bus, and her feet to get around to her various graduate school tasks and internships and whatnot.

    When my income went from a very low x to 3x upon moving out here for a job—in 2008 mind you, I got rather than lost a job, and it was a gig that was NOT going to be available anywhere in this country other than SF, Manhattan, or Boston—I spent two years paying off some debts and back taxes. Now, to amuse myself I’m paying down my only remaining debt (student loans) at a rate that should polish them off by the end of the year. These are loans I’ve had since 2006; not too large, not high-interest, but there’s no point in handing the lender easy money for the next fifteen years. The loans got me the degree that helped me get the job that tripled my income, and I got my job just four months after I graduated so it was a good investment. Also, I got a Hugo nomination for doing my job, so nyah.

    In 2011, I had the money lying around to spend $4700 on a dental implant—after insurance paid for the extraction and some of the post implantation surgery—without blinking. We took a nice trip to Scotland same that year. We eat out whenever we feel like it, generally at the inexpensive ethnic places in my neighborhood. My apartment has a fireplace and a backyard for my dog. I’m two blocks away from one of the nation’s leading independent bookstores and have twenty-five movie screens across four different cinemas within a ten-minute stroll of my house. They put the artsy in fartsy.

    If I had kids, things would be very different. If I bought a house at the height of the market in 2007, things would be different. If I wasn’t a HUMAN FUCKING MUSHROOM CLOUD WHO FEARS NO MAN ON EARTH and thus unable to enjoy the dirty fruits of a bohemian neighborhood without spending each day and night in abject terror, I suppose I’d have to cower in some gated community in the South Bay and things would be very different. But there’s nothing amazingly, magically expensive about the Bay Area that makes life on under a hundred grand a year necessarily untenable.

  258. I am 68 yrs old . my total income is 721 dollars a month in SS. they deposit 621. a month, the rest is Medicare…

    go for it. do the math!

  259. But really, take a look within yourself and try to determine whether you are angry at these people, or just mad that you aren’t one of them?

    None of the above, Kilroy. I’m more thoroughly bemused by the idea that I’m supposed to be poking my lachrymose crocodile over the financial angst of upper-middle class DINK twits living well beyond their means. I’m inclined to be more sympathetic towards people who are wondering how the hell they’re going to pay the bills after getting a matching pair of pink slips for Christmas. (True story for a couple of friends of mine, BTW.)

    I’m not mad at John for being richer than me – after all, he’s the one with three (I think) books hitting the shelves this year. If he not making more money than me, he should fire his agent ’cause someone’s screwing him like a nympho at an orgy.

  261. Every so often I come across an article in the local paper about someone who has died in obscurity and astounded the world by bequeathing a million dollars or so to their favorite cause. In most cases this person lived frugally on a modest income and invested his or her substantial savings wisely.

    So when you talk about the 1%, are you talking wealth, or income? The relationship between the two is not direct. In case you are not familiar with the Parable of the Talents, it can be found in the book of Matthew, chapter 25, verses 14-30. Also consider Polonius’ advice to Leartes in Act 1, Scene 3 of Hamlet. Or Aesop’s Fable of the Ant and the Grasshopper. Or the sayings of Poor Richard. None of which, I suppose, are endorsed by Madison Avenue, which would prefer that you be a tool and buy whatever they’re selling, preferably on credit.

  262. Let it be known that it was from this day forward that we all began referring to Nick Mamatas as HFMCWFNMOE.

  263. KIA: Taxing the sweat of a person’s legitimate labor, however, smacks of servitude and decreases motivation to work hard and get ahead. There is no morally or philosophically sound basis for a pre-emptive government claim of a quarter to a third of one’s private work. … People ought to focus on consumption; that is: the people who are buying $5k televisions, $60k or $100k vehicles, yachts, expensive vacations and other luxuries. Obviously those folks can afford higher taxes and a higher tax on consumption will help curb the most egregious excesses of the entire society.”

    Wow. So a progressive income tax is servitude and morally/philosophically unsound. But flat tax like a sales tax is totally sound? That’s funny.

    If anyone compares progressive income tax with a flat tax (income or sales), it becomes immediately obvious that the flat tax puts way too much burden on people who can’t really afford it. Anyone who compares progressive to flat tax will immediately see that progressive taxes are much more morally and philosophically sound.

    Which is why anytime anyone says flat tax is better, its because they weren’t comparing progressive tax to flat tax based on what is most fair to the people actually being taxed. Rather, they’re comparing progressive tax versus flat tax based on what best fits their own personal model of how government should act. Which is why it isn’t surprising that libertarians and anarchists will support a flat tax over progressive tax. Not because flat tax is more fair, but because flat tax gets rid of some government complexity and libertarians and anarchists hate government complexity. Government complexity to a libertarian is completely synonymous to government bloat, government excess, and so on.

    But libertarians can’t just come out and say they prefer flat tax over progressive tax because they want to strip out some government. Because that leaves the comparison of progressive tax versus flat tax left to be judged on the merits of which one is most fair to the people actually being taxed, and progressive tax wins easily. So, they always come up with all manner of smoke and mirrors that says progressive taxes are servitude and they have no morally or philosophically sound basis and so on.

    But really, you don’t care how the tax structures burden society as a whole. You’re just pushing for flat tax because its an indirect way of getting rid some government. You’re not judging the tax methods based on society, you’re simply looking at how it gets you closer to the goals you want to achieve.

  264. Scorpius: Anyway you cut it, the 300 million Americans have it much better off than about 6 billion people on the Earth.

    Bwhahahahahhwhwahaha!

    I don’t think I’ve seen such a blatantly transparent attempt for someone to argue “We’re not starving like they are in Ethiopia, therefore everything about America is moral and just”. At least not in a while. But thanks for that chuckle.

    And certainly the spoiled, tantrum-throwers in the Occupy movement do.

    certainly, they couldn’t be protesting anything like the Citizens United decision having a grossly injust effect on elections, right? Because in your world, corporations should be free to do whatever they want with whatever money they have,right? In your world, that part in the Constitution that says “Congress shall have the power to regulate commerce”, they were really talking about passing laws that help corporations, like SOPA, right?

    Laissez Faire!!!! And anyone who says otherwise is spoiled, tantrum throwing, rapey raping McRapers, right Brietbart?

    Sure, they may have been stupid enough to take out $100K in student loans to pay for an “Ethnic Studies” major giving them a worthless sheepskin, but they still seem to be able to afford iPads, iPhones, laptops, and name brand clothing (which they try to hide under their “hipster” garb)

    things are more moderner than before… bigger, and yet smaller… it’s computers… San Dimas high school football Rules!

  265. I haven’t seen Kilroy in a while, so don’t know if he has retired to lick his wounds, but I suggest anyone who wants to argue these politics can check in at Contrary Brin, David Brin’s blog. He is, for lack of a better term, a rational Libertarian, but is firmly agin’ some of the power grabs initiated by the folks with all the money. If you go, better bring your thinking cap, because strawmen et. al. will be knocked over and set on fire; the residents have no patience with anyone who can’t defend their stance in a reasonable fashion.

  266. @ Gulliver: The validity of Occupy’s arguments is *why* all of these unrelated, dishonest, and generally laughable objections are raised.

  267. John, I’m a little trouble by your note about the hair salon expense being the only one you felt lacked perspective. I was hoping when I clicked through to the link that the family wouldn’t be black – but they are. (Disclosure – I am white and can only explain my second-hand understanding of this issue.) The problem is that a nontrivial amount of racism experienced by black people, and I think particularly by black women, is aimed at their hair. Whatever choice a black woman makes with regard to her hair, she will be criticised either for looking “too black” or “trying to look white.”

    Obviously most people, black or not, can’t budget $400/month to their hair salon. But given the complexities of this issue, I’m not surprised that someone having that option would choose to take it, and I don’t think it reveals a lack of perspective with regard to their own finances. $350/month on gas, now … but what do I know, I drive a Toyota.

  268. Scorpius @ Various Times

    Do you believe that your consistently condescending tone in your posts convince anyone of the correctness of your arguments? It seems like you said you are a math teacher. I guess I would expect more logic and less emotion from you.

  269. @Greg:

    “…the flat tax puts way too much burden on people who can’t really afford it. Anyone who compares progressive to flat tax will immediately see that progressive taxes are much more morally and philosophically sound…”

    Not so. As you may note if you re-read my post, I was talking about luxury taxes, not food taxes. Everyone who complains about how regressive sales taxes are (that’s the term you were looking for) wants to suggest that poor people who could otherwise afford $1.00 mac and cheese will be completely unable to afford mac and cheese at $1.10 or $1.15. It’s a ridiculous argument, but it can be dispensed with altogether by making basic foodstuffs (not alcohol, not Carlos Cake-Boss cakes, not fillet mignon at a five-star restaurant) exempt from the sales tax. Problem solved.

    “libertarians can’t just come out and say they prefer flat tax over progressive tax because they want to strip out some government”

    It’s not that I want to strip out some government. I can and do read and think and do basic math. I can see that the huge bloated monstrosity which is indebting every single person here is completely unsustainable. Yes, if a revised tax structure can limit government or cause some downsizing, that’s great. Putting aside the tax concern altogether, if we don’t tackle the problem soon, however, decisions will be made for us by our creditors and then we get to choose between debt default or austerity measures combined with punitive tax hikes (whatever the tax structure) so anyone with an ounce of common sense should be concerned about reducing the size and scope of the government.

    “…really, you don’t care how the tax structures burden society as a whole. You’re just pushing for flat tax because its an indirect way of getting rid some government. You’re not judging the tax methods based on society, you’re simply looking at how it gets you closer to the goals you want to achieve.”

    Then let us be clear. I want a philosophically sound, fair and reasonable tax system which rewards hard work and investment and punishes consumption. You say that means I want a limited government and to trim bloat and waste, so I’ll go along with that too.

    You type your words as though you support a different system. Does that mean you want an unfair and unreasonable tax system which rewards consumption and punishes hard work and investment while promoting massive wasteful government?

  270. “So my question is, why does the debate always seems to focus on wrangling over tax cuts and who should pay what rate?”

    The debate is primarily around whether we will raise the tax rate on income tax, capital gains, or both. The truly wealthy are maneuvering hard for an income-tax only solution which is why you keep seeing article like the one posted, there is a fair degree of reverse propaganda at work.

    I feel strongly that both tax rates are at record lows and both need to be raised.

  271. KIA @ 142

    Define “hard work” and “consumption”.

    By my definition hard work includes the man who receives Social Security Disability Insurance because of a stroke and works ten hours a week because medically, that’s as much as he can do. Let’s say he grosses $1000 a month on that. Under a flat tax of 15%, he pays $150 a month. That leaves $850 for everything. Let us even give him $50 in food stamps a month. By my definition, he will not be able to make ends meets, while working hard. That $150 in flat tax is the difference for him in making ends meet.

    By my definition, “consumption” includes all good and services he pays for. Food. Gasoline. Car. Car insurance, Housing. Utilities.

  272. @Kia the problem with your proposal is it does not address corporations, which is where the majority of the ultra wealthy stash their money. Other then that, I like it.

  273. @Anne:

    The problem is that a nontrivial amount of racism experienced by black people, and I think particularly by black women, is aimed at their hair. Whatever choice a black woman makes with regard to her hair, she will be criticised either for looking “too black” or “trying to look white.”

    Not really sure what point you’re trying to make there. First, don’t know why you’re assuming it’s Mrs Jibodu who’s responsible for the CAN$100 a week in salon expenses. I know plenty of men who go through the top-shelf product and pay through the nose for the attentions of a trendy “stylist”. :)

    Second, won’t presume to speak for John, but I don’t actually begrudge anyone wanting to look nice. My parents weren’t particularly well off, but a couple of times a year (usually just before her birthday, wedding anniversary and Christmas) my mother would treat herself to a fancy cut and a manicure. Probably not the most fiscally responsible use of discretionary income, but it was just damn nice for her to sit on her arse and get pampered.

    But a hundred bucks a week going into the till of a salon? Wow, even for a family of three adults that seems ripe for trimming back.

  274. Kia: I think the issue here is that I don’t think there can be a sane system that rewards hard work without a commensurate government so I can afford to take risks and don’t have to worry much about gangs in Toyota pickups with AK47s.

    You see “bloat”, I see a currently inadequate system which isn’t really protecting the most vunerable members of society. You see lazy people, I see a teenager whining about how much their parents want them to pay in rent from their first job. etc…

    This argument will, at the end of the day, come down to what *you*, not I, define as bloat and waste, and typically, when I hear those words used, they are then followed by things like NPR, or parks, or other things that cost nothing, or parts of the social safety net which is entirely inadequate to start with.

    The US has seen wealth concentrated into the hands of a few over the last few decades, and frankly, I don’t want to live in the 19th century, because that was unsustainable.

  275. @ D G Lewis

    Really? In my family, two cars for two wage earners costs us $0 per month. My car has been paid off for the past 7 and a half years, and my wife’s for the last 5.

    So you don’t insure your cars or buy gas? or get them inspected, or replace the tires, or change the oil, or do repairs…

    There’s a lot more involved in owning and maintaining a car in addition to the up front cost of buying it and paying it off. I’m not defending KIA’s assertion that $10K a month doesn’t go far in DC (I have a lot of friends in the DC area who are raising children on 1/3 of the $200K broken down in his example – they’re actual gov’t employees, not contractors), but there are real criticisms to be made without being silly about it.

  276. I’ve said more than enough to stay nonspamular, and have avoided re-entering this interesting discussion with my Peer-reviewed Mathematical Economist hat on, but decided not to. More important to me, is my experience in teaching extremely impoverished children at predominantly Hsipanic schools in LAUSD, and predominantly African American schools in PUSD and LAUSD. PUSD = Pasadena Unified School District, which, despite Caltech being in town, suffers extremes of poverty and ignorance. LAUSD = Los Angeles Unified School District, the 2nd largest in the USA, with current official figure rounded to 664,000 students (New York’s district is #1, Chicago’s is #3).

    I have found it enlightening to ask as my first question to a new batch of students: “Is it better to be rich or poor?” Then shut my mouth for 5 to 15 minutes, during which they reach a consensus. My follow-up question: “How do you get rich? also leads to fascinating, and sometimes heartbreaking, dynamics.

    My wife (whose mother grew up in Prince Rupert, BC, Canada) has taught in 4 countries, but I am not channeling her.

    I see you fine people collectively reaching a fractal consensus. Not quite the same one, I’d note, as my 3,000 to 5,000 students so far, the latest batch of which were 100% children and grandchildren of “illegal Mexican immigrants.”

  277. @ Craig Ranapia

    I made no assumptions about who was spending the money – I hate to break it to you, but you actually made that assumption yourself. So, thanks for proving my point for me?

    To restate it: my point was that black women are disproportionately blamed for (a) having hair that doesn’t conform to mainstream beauty standards, and (b) trying to deal with their hair, e.g. by straightening in it, having it put in cornrows, etc.

    Since, as I mentioned above, I am not black and therefore do not personally face this issue, I’d be glad to hear from anyone who is, and can fill us in on whether $100/week for a family of four is a reasonable expense for a hair salon.

  278. TheMadLibrarian: He is, for lack of a better term, a rational Libertarian,

    Rational? No. No one is a rational libertarian. Libertarianism is sourced primarily by fear of government. Everything after that is simply trying to justify the fear or make it go away.

    KIA demonstrates this perfectly when he ends his post to me with this little humdinger: Does that mean you want an unfair and unreasonable tax system which rewards consumption and punishes hard work and investment while promoting massive wasteful government?

    Because as far as any Libertarian is concerned, no other party but a libertarian wants a fair tax system, nobody but a libertarian wants to reward hard work, nobody but a libertarian wants to stop *wasteful* government.

    That isn’t *rational*. That’s fear. And fear has people make silly arguments like that. Fear of government has people make nonsense arguments about government because the purpose of their argument isn’t fundamentally “How do we have government create solutions for problems that can’t be solved by selfish individuals?” To a Libertarian, ALL problems can be solved by selfish individuals. The prisoner’s dilemma and the tragedy of the commons mathematically explain how this can occur.

    Anyone who is *rational* would see the tragedy of the commons and the prisoner’s dilemma and realize that a world of selfish individuals will not reach the best possible outcome in certain situations. Anyone who is *rational* would see that there IS such a thing as society that is more than just selfish individuals, and that society can solve certain things that selfish individuals cannot.

    Libertarians do not see society. At all. Thatcher’s “There is no such thing as society” is the perfect demonstration of this mindset. Libertarians do not see society, therefore do not see the tragedy of the commons and the prisoner’s dilemma, and therefore Libertarians will ALWAYS attempt to solve any and every problem through selfish individuals, not society. And that just isn’t rational.

    KIA: It’s not that I want to strip out some government. I can and do read and think and do basic math. I can see that the huge bloated monstrosity which is indebting every single person here is completely unsustainable.

    It’s not that you want to strip out government, but government is a huge bloated monstrosity which is completely unsustanable?

    Really???

    Well, then tell me. If government is a huge bloated monstrosity which is completely unsustainable, what *exactly* do you want to do with it that doesn’t involve *stripping* it out?

    This is the *rational* Libertarian?

  280. @Todd:

    “Under a flat tax of 15%, he pays $150 a month. That leaves $850 for everything. Let us even give him $50 in food stamps a month. By my definition, he will not be able to make ends meets, while working hard. That $150 in flat tax is the difference for him in making ends meet.”

    You completely misstate the premise. I am not talking about a “flat income tax rate” at all. I am talking about a sales tax on all items sold in the US (point-of-sale, so foreign nations can’t benefit by dumping) with a larger one on luxury items (fight about what that is, I don’t care) and an exception for all basic foodstuff. Nobody who is poor will suffer anything from this tax – unless they choose to buy anything defined as luxuries, in which case everyone pays the same rate.

    @unholyguy:

    “…the problem with your proposal is it does not address corporations, which is where the majority of the ultra wealthy stash their money. Other then that, I like it.”

    Money isn’t really “stashed” in corporations per se. The wealthy throw their money into private hedge funds which use very dubious means to achieve very high returns. I think that is their right to put the money at risk for higher returns, but a sales tax upon everything, including the sales of stocks, bonds, commodities and all financial instruments would immediately dispense with several evils such as flash trading and severely hamper speculative trade frenzies. Worst case, high-volume trading would provide higer tax revenues with which the same might be policed.

    Corporations will also pay sales taxes like anyone else, but the strange behavior of corporations is part of a much, much larger problem with the existing tax code: it rewards advertising and essentially subsidizes Madison Avenue, which in turn inflates prices of all entertainment, sporting events and so on. Consider: if a corporation has a million-dollar surplus which it could a) pay to shareholders in dividends, b) pay to the government in taxes, or c) dump on the Mad Men of Madison Avenue for yet another ridiculous advertising campaign that tells you nothing about their product and completely avoids any rational reason for its’ existence, which one do you think a corporation will choose? Experience shows us it will be c) every time. In the current tax system, advertising is basically a tax shelter. It doesn’t actually matter if the advertising creates any real benefit for the company as long as there is a possibility that it might, the money will be sent there rather than to the government or shareholders.

    If the corporation is going to have to pay sales taxes, however on the sale of Madison Avenue’s services, then what happens? They may continue to dump cash there, but there is no benefit. They’re not being assessed income tax and more advertising spending is more tax payments, so they might actually look at returns on the investments. We would probably see advertising revenues diverted to more productive objectives. Corporate earnings might go up, but they’d have to spend that money somewhere. If they can’t do high-return speculative trading, they may just decide they can get a decent rate of return by investing in new ventures, new hiring and growth.

  281. Then let us be clear. I want a philosophically sound, fair and reasonable tax system which rewards hard work and investment and punishes consumption.

    When people consume goods and services, that gives somebody work, either in production or service itself or in distribution and sales.

    Currently, there’s not enough work to do that people can actually get paid for. If we punish consumption, the amount of available work to satisfy the need for consumption will decrease from its current value, which will make people poorer and possibly discourage consumption even more. The disaster scenario is a deflationary spiral, like the Great Depression, in which prices crash but nobody can afford anything because they’re not getting paid.

    Now, there are certainly advantages to discouraging consumption, or at least some types of consumption. It’s better for the environment if people consume less energy and manufactured goods, for instance. But if we do, our society needs some way to ensure that people can attain decent lives by some means other than consumer-society-driven jobs. And the available means I can think of aren’t exactly models of small-government market capitalism.

  282. “To restate it: my point was that black women are disproportionately blamed for (a) having hair that doesn’t conform to mainstream beauty standards, and (b) trying to deal with their hair, e.g. by straightening in it, having it put in cornrows, etc.”

    I don’t know where you hang out, but “black women’s hair” doesn’t really rank very high on the “alleged societal ills” scale. Frankly, if black women feel pressured to spend lots of money on expensive hair treatments and weaves, the pressure is probably not coming from white guys.

  283. Since, as I mentioned above, I am not black and therefore do not personally face this issue, I’d be glad to hear from anyone who is, and can fill us in on whether $100/week for a family of four is a reasonable expense for a hair salon.

    Good. I am of mixed race descent, I know a (minority) woman for whom dropping the equivalent of CAN$400, at least, on a single visit to a hair salon is no problem. She can easily afford to go to a very fashionable – and expensive – stylist, and I’m not going to criticize her for that. Hell, add a zero to that (and a few round trip plane tickets) and you’re in the ballpark of what one or two fashionable stylists will be billing after Oscar night. :)

    Just because the Jibodus are Nigerian (and all I know about their circumstances and experience is in a sidebar to a magazine story), I don’t really appreciate the implication that there’s a racist or sexist subtext to raising an eyebrow at CAN$4,800 a year going on the “hair salon.” Hell, I don’t think I was even that critical of it, because, as John points out, they’re not exactly oozing obnoxious entitlement like some folks quoted in that story. Nor do I find it in me to harsh on Margaret’s “weakness” for shoes and handbags, given one or two (dozen) slap-worthy overdraft-stretching impulse buys I’ve made in bookstores over the years. :)

    Sorry, but bleating about how hard it is when you can only afford to eat out three nights a week? Not really tugging on my heartstrings.

  284. KIA: I am talking about a sales tax on all items sold in the US … Nobody who is poor will suffer anything from this tax – unless they choose to buy anything defined as luxuries

    This is nothing but cover for the underlying fear of government that does not wish to fill out a tax return. If we have a sales tax, or luxury tax, etc, instead of an income tax, then we wouldn’t have to fill out a tax form and have the IRS have power over us.

    You’re not looking for a solution that is most *fair*. You’re looking for the solution that has *least* *government*, and then trying to argue that its FAIR. The problem is it isn’t fair. it’s UNfair. BUt that doesn’t matter to you in the least, because it results in LEAST GOVERNMENT.

    sales tax upon everything, including the sales of stocks, bonds, commodities and all financial instruments would immediately dispense with several evils such as flash trading and severely hamper speculative trade frenzies.

    You know what else would immediately dispense with several evils such as flash trading et al?

    government regulation.

    Which Libertarians fear. Which is another reason you’re couching this entire “sale tax” nonsense in terms of a barter. You’ll “allow” the government to tax people, in exchange for preventing the government from having us fill out tax forms and regulating commerce.

    Seriously. If flash trading is evil, why not outlaw it via regulation? Only a libertarian would argue that it is evil, but oppose regulating it, and instead suggest that “flat sales tax” would make it go away.

    Again, this isn’t *rational* argument. This is a fear based argument trying to put a thin veneer of rationality on top of it. This is a 5 year old kid who leaves the light on because he is afraid of the dark but then tries to explain that its more efficient in case he needs to use the bathroom at night. It’s not efficient. The kid is operating from fear.

    You’re not looking for the FAIR tax system. You fear government and you’re looking for ways to minimize government, whether the resulting minimization is fair or not.

    This is libertarian logic in a nutshell:
    Small but unfair government == good
    large but fair government == scary and bad

  285. It’s not really correct to say that by buying a car outright you are paying $0. It’s essentially a depreciating capital expense, all accounting systems would spread the cost of the car over its lifetime and have a depreciation expense hit the books each year.

    Buying cars outright is only good in that you avoid paying interest on a loan, of course you also give up capital gains on the principle. You come out ahead a few basis points usually..

  286. Nobody who is poor will suffer anything from this tax

    You exempting fuel? Books? Printed media? Internet access? What are you defining as basic food stuffs? Soylent Green? Healthcare? Dental care? Eye care?

    Creating a sub-class without affordable access to the trappings of modern civilization couldn’t POSSIBLY have a downside.

  287. If the corporation is going to have to pay sales taxes, however on the sale of Madison Avenue’s services, then what happens? They may continue to dump cash there, but there is no benefit.

    It might behove you to have a look at the relative rewards of advertising versus sales. There isn’t a direct relationship in sales of FCMG items to advertising – i.e. if I spend $1M on an advertising campaign, I am not expecting it to make an additional $1M in sales, I am expecting it to net many multiples of that. That is in fact what we see.

    Even if we have your sales tax, corporations will still advertise because it is a key way to get business for their products.

    Anyway, the only real way such a system works is if corporations are allowed to offset what they spend on tax, against what they take in.

    Anyway, what you are describing is VAT as operated all over the world and it doesn’t seem to have the results that you think it does.

  288. Jonathan Vos Post: “In 1900, correcting for inflation, a USA University professor earned roughly $300,000. By definition, he (not he/she) was a pillar of the community, and thus had to entertain the richer bankers, lawyers, mayor, that sort. So had to have a home, cook, butler, gardener. By definition. That ship has sailed. In return for dumbing down American schools, with the pretense that every little boy deserves to graduate college, the iron law of Supply and Demand kicked in.”

    I think it’s better that university professors aren’t such “pillars” and that there were some who did not teach merely the wealthy who could afford to go to college in 1900. Put another way, you and your son might have been working in factories instead of what you are doing today.

  289. Then let us be clear. I want a philosophically sound, fair and reasonable tax system which rewards hard work and investment and punishes consumption.

    Hoarding?

    Tangentially connected to the rest of this: A friend of mine has hypothesized that part of the reason our country’s in such bad shape is because being a financier pays so much better than medicine, rocket science, or research, causing a lot of the smart people who might otherwise be keeping us alive or advancing technology to juggle numbers instead.

  290. And I do like that you seem to be acknowledging that investing isn’t ‘hard work’ in any meaningful way, even if you do think it should be rewarded equally.

  291. @Greg:

    The problem becomes clearer. Your notion of “fair” means you get to take whatever you want from whoever you want for any reason that crosses your mind to redistribute to whoever you want. That is actually known as “stealing.”

    Your use of the word “fear” also shows an incredible amount of displacement behavior. You fear an unregulated market. You fear your neighbors and friends. You fear that somebody somewhere will harm you. As a result of this massive set of fears, you want a big daddy to make all of the bad things in the world just go away and stop, so you want every regulation it is possible to think of.

    Here’s the bad news: no amount of regulation, even in the Nazi regime, even in Stalinist Russia, even under Mao, has ever stopped wrongdoing. In fact, all of these repressive regimes killed millions of people and crushed those who remained through fear of similar treatment – and still failed to achieve their goals. Your fear is hideously misplaced. If you don’t fear government, you are no student of history.

    Finally, for all of your purported rationality, you have completely ignored the fundamental proposition, refused to deal with the advantages on their merits, and have tried to distract and dissuade through emotive arguments that have no bearing whatsoever on the practicality and effectiveness of the proposition itself. Your verbosity and purported passion might be admirable if they were supported by even a tiny shred of intellectual honesty, but as they are not, we’re done here.

  292. @ Daveon:

    “Even if we have your sales tax, corporations will still advertise because it is a key way to get business for their products.”

    Well, it would kind of be a pointless tax if it didn’t generate any revenue, now, wouldn’t it?

  293. KIA: Your notion of “fair” means you get to take whatever you want from whoever you want for any reason that crosses your mind to redistribute to whoever you want. That is actually known as “stealing.”

    BWHAHAHAHAHWHWWHAHWHAHWHA!

    Just so you know, the terror you feel towards normal government behavior (collecting taxes, providing services, passing laws and enforcing them) is coming through loud and clear right now.

    But it is kind of funny.

    No, really, I’m serious. Someone actually made this into a joke about libertarians at least as far back as 2007. check this out:

    http://www.bluegrassrivals.com/forum/archive/index.php/t-29376.html

    Take any statement about any progressive program. Add an exclamation point.

    And that is how you get a KIA/Eliza program.

    You fear an unregulated market. You fear your neighbors and friends. You fear that somebody somewhere will harm you. As a result of this massive set of fears, you want a big daddy to make all of the bad things in the world just go away and stop, so you want every regulation it is possible to think of.

    I am only saying this because I care – there are a lot of decaffeinated brands on the market today that are just as tasty as the real thing.

    I don’t fear an unregulated market. I just happen to know that as a simple example, an unregulated commons with selfish individuals will always push towards a tragedy of the commons outcome. Always. It’s just math. There’s nothing to *fear* about it, unless arithemetic is a weakness of yours. And it doesn’t mean I fear my friends and neighbors, it just means that I understand that if we all have a commons like the atmosphere, that each one of us as individuals will tend to pollute that atmosphere unless we have government regulation.

    Always.

    The problem is, Libertarians fundamentally don’t understand systems. They don’t understand the tragedy of the commons. They don’t understand the Prisoner’s Dilemma. They have a fantasy model of the world in their head that says unregulated selfish individuals will *always* result in the best possible outcome.

    Except actual mathematicians and system designers will tell you that such a model is complete shit.

    So, just to explain this to you bluntly, KIA, the problem isn’t that I fear my friends and neighbors. Rather the problem is you don’t understand simple game theory.

    Here’s the bad news: no amount of regulation, even in the Nazi regime, even in Stalinist Russia, even under Mao, has ever stopped wrongdoing.

    You are so full of it (fear) right now.

    If that statement was true EVEN IN THE SLIGHTEST, then *deregulate* murder. Murder is wrong doing. It is regulated by the government. If no amount of regulation ever stopped wrongdoing, then get rid of the laws that regulate murder.

    Don’t like that? OK. How about speed limit laws? Driving 200 mph through mainstreet in a school zone would endanger children, which would qualify as wrong doing were it to ever come to fruition. So we *regulate* the legal speed limit so as to prevent needless accidents. If youre statement was true EVEN IN THE SLIGHTEST, then we should be able to get rid of speed limit laws, stop signs, stop lights, and traffic *regulations* of all kinds. Those regulations exist because selfish individuals will run through intersections without looking, will speed through school zones without slowing down, and will drive drunk without caring about the ramifications, and society realizes that if we WAIT UNTIL SOMEONE IS KILLED by a speeder or a drunk or whatever, then the number of deaths on the highway would skyrocket.

    Unregulated traffic is a prisoner’s dillemma. It results in people acting in their own self interest, and creating a far worse outcome than if we *regulate* traffic preemptively and make it illegal to drive 250mph in a school zone, rather than wait until the drunk guy with the porsche kills a dozen kids getting on the school bus.

    In fact, all of these repressive regimes killed millions of people and crushed those who remained through fear of similar treatment – and still failed to achieve their goals.

    Boogah boogah….

    If you don’t fear government, you are no student of history.

    Remember when I said that your arguments are not rational but are sourced by fear? You’re actually letting that fear bubble up to reveal itself. And the crazy bit is that you don’t even see your fear. To you, it’s nothing more than a realistic view of the world.

    Are you familiar with firearms at all? I remember when I was a really young kid and my dad was showing me how to shoot a 30-06. Big rifle. Lots of kick. I was really young and my arms were barely long enough to hold it, but I wanted to shoot it. So he helped me and I fired it. Thing kicked me in the shoulder like a mule. When I went to try again, I was so tense and had so contorted my body that I couldn’t hold the damn thing steady. I couldn’t aim. I was terrified of shooting it. My dad saw what was going on and told me not to fear it, but to respect its power.

    You fear government. Just reading what you’ve written in this last post alone, you’re screaming into the night terrorified of government. That’s not going to get you anywhere. That’s like me as a young kid terrified of the rifle. You need to respect government like one might respect the power and danger of a rifle. Don’t point it at anyone unless you mean to shoot them. Always assume its loaded. Squeeze the trigger, don’t jerk it. And all that.

    If we extend this analogy, then libertarians fear government and want to get rid of government like *some* gun haters fear guns and want to get rid of all guns.

    I’m using that analogy specifically because I assume as a libertarian, you own weapons and you can see that some people fear guns and want to get rid fo them completely when the real problem is they don’t understand guns and don’t respect guns and are able to treat guns with respect.

    Hopefully, if you can see how they do it wrong around guns, maybe you’ll be able to see how you’re doing it wrong around government.

    Finally, for all of your purported rationality, you have completely ignored the fundamental proposition, refused to deal with the advantages on their merits,

    First of all, riddle me this. If a extreme gun control guy came up to you and said all guns should be outlawed, would you deal with the merits of his proposal? Or would you realize the problem is the guy is terrified of guns and simple wants them to disappear?

    Yeah. That’s what I figured.

    THere are no merits to your proposal, KIA. Because your proposal is about as grounded in reality as some guy terrified of guns trying to outlaw all of them. The only difference between you and that sort of person is the thing which you are terrified of is different. But you’re both acting totally irrationally.

  294. re: the subthread on car expenses, here is a real world data point. I pulled out my actual budget numbers for my sole car, a 10-year-old Toyota Sequoia. It costs $763/month to operate, which breaks down as follows:

    $63 insurance
    $125 tabs, repairs, maintenance
    $200 gas
    $375 savings for the next car

    That last line item is an important one since by socking that money away every month, I’m able to pay cash for all my cars. Anyone who isn’t budgeting that (or their car payment) into their car expenses isn’t accounting for the whole expense. The $125 maintenance budget is probably too low for a 10-year-old car because it’s currently overspent (new timing belt + new tires in the last year, and I’ve been lucky to have a trouble-free car).

  295. Guys, it looks like to me you’re taking advantage of my being distracted by a convention to be rude to each other. Start reeling yourselves back in. I’m kind of not in the mood.

  296. What’s interesting about this article and others like it is the talking all these people are doing. It runs directly counter to their interests to be talking about their purchases and their inability to handle them. If you’re buying artisanal cheeses to keep up with the Jones, you don’t tell the Jones you can’t really afford them as then the Jones know they’ve won and you’re not worth their time. If you are going to buy an expensive car on a regular basis on the claim that this will make you seem like a player to the asset wealthy so that they will let you in on a good asset deal and executive positions, as some are arguing, you don’t trumpet to them that it’s just a sham. Usually, people with money are quiet about it, and keep it mysterious exactly how much they have. The truly wealthy — those with several mil or more, don’t pay more than a token amount of tax, can fully avail themselves of corporate welfare or inheritance protections, and stash their money in trusts, funds and other vehicles that will not be taxed and which earn returns in the very worst recessions while rank and file investors lose their shirts. Warren Buffet doesn’t just pay a lower tax rate than his secretary; he has huge amounts of money that isn’t taxed at all. And the bulk of this money is based on speculation of worth and debt, including speculating to profit off of decline and loss, rather than actual worth, and it does not come back into the economy in any useful way. If you can’t make enough off of investments to majorly increase your income and assets, then there’s not much point in buying the expensive stroller and the cars, because you’re not going to move up, nor are your children. Children from the expensive colleges are moving back in with their parents. So if you’re spending money on cheeses and not plowing it into investments and complaining publicly about how you can’t even afford the cheeses so that all the richer people know you’re a hopeless nobody, then you’re well off — unless you get laid off — but you’re not real strategic.

  297. Kia,

    Well, it would kind of be a pointless tax if it didn’t generate any revenue, now, wouldn’t it?

    I think you’re now arguing against yourself.

  298. That is actually known as “stealing.”

    Actually, honestly, and with all due respect (of which I have quite little for you) – it isn’t. Not even remotely.

  299. Sorry John. But REALLY? Sorry. Lost it there… still reeling from the statements, that’s all.

  300. KIA says: February 18, 2012 at 1:42 pm
    As you may note if you re-read my post, I was talking about luxury taxes, not food taxes. Everyone who complains about how regressive sales taxes are (that’s the term you were looking for) wants to suggest that poor people who could otherwise afford $1.00 mac and cheese will be completely unable to afford mac and cheese at $1.10 or $1.15. It’s a ridiculous argument…

    It’s not the individual box that’s the problem. It’s knowing that the tax means the budget that should buy thirty days of food now buys twenty-seven. And there’s no extra money in the budget – so the only answer is to buy cheaper food, or less food.

  301. People don’t really need to buy (or lease) the luxury cars every three years to keep up with the Joneses, even at prestigious law firms. They can get around that by buying a car with character and keeping it. So when my sister parks her sporty mini-cooper amid the Lexi and Benzes, there are also early model Priuses, Smart cars, electric cars, (for the quirky environmentalists) and classic sports cars (an expensive but only one-time purchase, since it becomes even more prestigious with age). We have a friend who does the sports car thing but he has two cars– a civic that he uses for regular driving and a classic Porshe that he only drives for work purposes.

    I’m not sure how much I believe that high earners actually do need to keep up with the Joneses. Maybe in some professions that are all about smoke and mirrors. But most of the high earners we know are more like the Millionaire Next Door than Real Housewives.

  302. Hidey-ho Greg! Seems I said I’d try and follow up our last conversation a couple weeks back, and then sorta didn’t follow through; sorry ’bout that. Kinda fell to the back of my mind after a 16 hr test; but anyways,
    I’m noticing that a foundational belief of yours regarding libertarians is that our whole worldview is informed disproportionately by fear. Leaving aside whether or not fear of the govt. is legitimate (and again I’m not even sure “fear” is the best word to be using), there’s a plethora of reasons to favor keeping govt. involvement in our lives to a minimum, say to a level of “keep people from hurting each other” (and yes, that can apply to environmental externalities too). These range from the practical to the ethical, the latter of which is where I think the argument over income redistribution would more appropriately fall, especially given your particular penchant for “fairness”.

  303. @ nicoleandmaggie

    They can get around that by buying a car with character and keeping it.

    A well-maintained classic car has more suave than a brand new Beamer any day. Whenever someone comments on my ’70 Volvo 164 it’s usually along the lines of that’s in better shape than my new car. Sure it’s some work to maintain and parts can be hard to come by, but I had to completely rebuild the engine anyway, so I replaced the six-cylinder with a five-in-line turbo someone was junking from a perfectly good ’99 S70’s T5 (well, the frame was totaled, but the engine was fine). It’s great because most drivers who try to cut me off get caught off guard. No one expects a forty year old car to accelerate like a ten year old sports sedan. I even installed a new stereo with wireless and hands-free so I can use my phone’s Bluetooth for calls and mp3s, and put in sound insulation so there’s almost no road noise when the windows are up. And the body’s built like a tank, thank you very much. Millage isn’t great, but it isn’t terrible either. Yeah, someday gas will cost here like it does in Europe and I’ll grudgingly get a hybrid and keep my Volvo in the garage for special occasions, but I wouldn’t trade for all the 6-series in Germany.

  304. But most of the high earners we know are more like the Millionaire Next Door than Real Housewives.

    This is my experience too, though I live in a high-tech area. Most of the multimillionaires around here are software industry people, and software industry people don’t seem to care much about the outward expression of status. They may buy fancy cars if they have a love for fancy cars; otherwise they’ll just buy something that gets them from point A to point B.

    It may be that the “smoke and mirrors” professions require some status purchases, but I suspect that in most cases it’s not a profession-based need, but a want. As in, “I want to feel superior.”

  305. KIA @ 3:36

    It’s true you never mentioned a flat income tax. But in the example I provided, can’t you see that a flat consumption tax will function very similarly to a flat income tax? For people with little or no discretionary income, their money (after housing costs) would go into consumptive goods. (Are you saying there would be no tax on housing costs, because it would not be “consumptive”?) What is a “luxury” good in your model? Who defines it? You? A “government” entity?

    I ask these questions because I once believed something very similar to what you stated. But that was when the questions were abstract to me. When I started encountering real people in the real world, I started noticing that there were quite a few details that my model failed to account for. And that the real world results were contrary to what I would have predicted.

    Let me compare it to squad level armed tactics. Your model may sound good in the abstract, but will it survive contact with the enemy? Does it have enough flexibility and meat to it so that it can produce stable outcomes across a range of conditions?

    Would you even admit that in the example I proposed, the person would not be able to sustain food, housing, and basic necessities? Further, can you see that under your model, a significant proportion of people would not be contributing to a constructive economy, because of your tax model?

  307. Todd:

    Good luck with that. KIA passed the buck on those definitions. Specifically, KIA “doesn’t care” what the rate of taxation is. And “basic foodstuffs” appears exclude brand name items and “filet mignon from a five star restaurant”. (I for one don’t quite understand how one part of a cow is considered a luxury while another is a necessity.) Seems KIA would like us all to just accept the natural wisdom of the flat sales tax and not bother hir with the details.

  308. “I’m not sure how much I believe that high earners actually do need to keep up with the Joneses. Maybe in some professions that are all about smoke and mirrors.”

    I saw it a lot at the brokerage, and not doing it did hurt my career advancement there which is one of the reasons why I didn’t make a career out of financial services (wise choice in retrospection). I see it a lot on law firms, sales, fund raising, upper level management in fortune 500 countries. Not much in tech firms (though there is a gadget-element in tech firms) or in creative functions.

    I think being able to diagnose how much of an occupation is “smoke and mirrors” and how much is substance based is an important skill. One that you do not get from your education for sure.

  309. (and that’s Canadian dollars, mind you!)

    (raised eyebrow)

    Parody of how insular Americans are unaware about the degree to which Bush turned the US dollar into toilet paper or are you genuinely not aware of how far the US dollar fell wrt to the Canadian dollar since 2000?

  310. Doc RocketScience @ 12:14 pm: I don’t agree with KIA, but in their defense, many sales taxes do try to make some distinction between groceries and prepared food, although with sometimes unintuitive results. For example, according to a receipt I found lying around, I recently bought breaded jalepeños stuffed with cheese, an Italian hoagie, 8 ounces of egg salad, and a six pack of microbrew. (Also, according to the receipt, my cashier that day was Donna.) For whatever reason, I paid sales tax only on the hoagie; the jalepeños and egg salad were not taxed. (I imagine I paid tax on the beer, too, but it was probably included in the price.)

  311. many sales taxes do try to make some distinction between groceries and prepared food

    The twilight years of the old Progressive Conservative Party of Canada involved the introduction of the GST (which was a visible tax that replaced an invisible federal sales tax that was actually a bit higher, as I recall). Many necessities were excempt. Feminine hygiene products were not deemed necessities by the Minister of Finance, probably because he himself had never needed to buy any. Subsequent governments have, iirc, maintained the GST on such products….

  312. Amitava!

    hey, how’d the test go? Hope it turned out well.

    I’m noticing that a foundational belief of yours regarding libertarians is that our whole worldview is informed disproportionately by fear.

    Well, for a confessional example, there’s this:

    KIA@8:38: If you don’t fear government, you are no student of history.

    Every time I talk with a Libertarian long enough, this kind of fear always reveals itself. The above example was from the same post by KIA where he accuses *me* of the following:

    You fear an unregulated market. You fear your neighbors and friends.

    Think about that for even a moment.

    What would government be made of other than my neighbors and friends? My fellow americans? My countrymen? If I feared them, why would I want them in power of any kind? If anyone is fearing anyone else, KIA is revealing his fear of his friends and neighbors. He doesn’t trust them enough to be part of the state, to be part of a government.

    It’s not that he *trusts* a free market. It’s not that he *trusts* his friends and neighbors in that free market. It is simply that he has convinced himself that if he can get himself into a free market, then all the people he distrusts can’t get a leg up on him. He is “free” in a very limited sense.

    How is laisez faire a limited sense of freedom? How is an unregulated market combined with a libertarian form of government not “free”?

    because it results in worst possible outcomes in some situations. If you are stuck in a prisoner’s dillemma type scenario, selfish individuals will result in worst case outcomes for everyone. If you can put some sort of regulation on the scenario/circumstance (something called a “strategic move” in game theory), then you can alter the scenario so that selfish individuals will tend towards a different choice that yields the best possible outcome for everyone involved.

    Libertarians don’t believe the math, though. So, just bear with me for a second. Just assume for the moment that this really is true. Assume for a moment that a prisoner’s dillemma with selfish individuals gives the worst possible outcome. Assume for a moment that a strategic move that allows you to *regulate* the circumstance will alter the outcome so that everyone selfishly chooses the best possible outcome for everyone. Just go with me for a second.

    Now, with that assumption, lets say that Libertarian philosophy says there is “no moral standing” for people to make such a strategic move, lets say that Libertarian philosophy asserts that regulation is always immoral.

    Alice and Bob are caught in some Prisoner’s Dillemma. Larry the Libertarian is in charge of government. Alice and Bob figure out that if they work together through government and create a regulation that alters the prisoner’s dillemma, they remove the trap. But Libertarian Larry insists that such a strategic move is IMMORAL.

    In Libertarian Larry’s world, Alice and Bob are *prohibited* from creating a regulation that solves the prisoner’s dillemma scenario.

    How exactly is that freedom?

    there’s a plethora of reasons to favor keeping govt. involvement in our lives to a minimum, say to a level of “keep people from hurting each other”

    But its mechanical.

    If Alice and Bob find a situation that is a prisoner’s dillemma, and figure out a strategic move that would change the game so that it no longer results in the worst possible outcome, then they could come together via the govenment that represents them and create a regulation that removes the prisoner’s dillemma.

    Explain to me, in Libertarian terms, how you can justify copyright and patent law? It is a regulation from the government. It isn’t regulating a physical crime. It is restricting the free exchange of ideas. It is an imposition. It is a restriction. It is in direct opposition to the libertarian principle of “small government with as little regulation as possible”. The amount of time and energy spent by the government on court cases revolving around intellectual property laws is massive. It is a huge expenditure of time and money that the government must pay for. If one applies the mechanical rule of libertarianism to IP, one would conclude that it is an unneccessary regulation.

    but I support it because ideas and expressions are a kind of commons. It takes energy to create those ideas and put them on paper. But as soon as you sell one copy, that buyer could take it, duplicate it, and sell it cheaper than you’re asking. Which means there is no incentive for artists. There is no incentive for inventors. It is a tragedy of the commons kind of scenario.

    And selfish individuals cannot solve a tragedy of the commons by themselves. The only way to solve it is to regulate it or remove the commons entirely (privitize it). With something ethereal like ideas, you cant privatize it because it isn’t a thing that can be bought and sold. So you have to regulate it. You have to invent laws that attempt to privitize an idea into property, so it is no longer a commons. But it is possible only because government regulation enforces that notion.

    Any libertarian who actually supports copyright law and patent law is an “ad hoc” libertarian. They repeat the libertarian mantra of no government regulation, but then they keep making exceptions for regulations that are obviously a good thing and obviously solve real problems.

    Copyright law and patent law solves real problems, namely how ideas are a commons. And they solve the problem by regulations.

    The problem when talking with a Libertarian, especially an ad hoc libertarian, is that they don’t get where people are drawing the line for government intervention and so they make a mechanical line that says something like “physical violence can be outlawed”, and then they have to make ad hoc exceptions for stuff like traffic laws and pollution and copyright. But it is ad hoc.

    As soon as you look at the world through game theory, you can start to see where Tragedy of the Commons naturally exist. You can start tosee where Prisoner’s Dilemmas naturally exist. And then you realize that selfish individuals cannot solve those problems alone. But if they work together, through their govfernment, then they can solve the problem through a strategic move, usualy in the form of regulation, that causes selfish individuals to choose the path that results in the best path for everyone.

    But I’ve had Libertarians tell me that the tragedy of the commons doesn’t exist. Or that selfish individuals would naturally choose a different outcome to avoid the tragedy. But that simply shows that they don’t understand the math/game theory of the problem. Either that, or they are simply driven by fear of overnment. Becasue if they acknowledge that the Tragedy of the Commons or Prisoner’s Dilemma is real, then they would have to acknowledge that the only solution is government intervention of some sort. Selfish individuals acting in an environment with no regulation will not always choose whats best for themselves or anyone else. But libertarians fear government so much, they’ll insist the sun goes around the earth, rather than to give up their percieved freedom and power they experience when they hold the belief that they are the center of the universe.

  313. Feminine hygiene products were not deemed necessities by the Minister of Finance, probably because he himself had never needed to buy any.

    Or tampons just don’t have very good lobbyists. #justsaying IIRC, one of the more peculiar wrinkles when GST was introduced in Australia was that if you went to the supermarket and brought fresh chicken that was deemed “basic food” and exempted. Buy a cooked rotisserie one, and it wasn’t. When New Zealand introduced a similar tax in the 80’s, the decision was made not to have any exemptions at all. Perhaps I’m biased :), but I think New Zealand got that one right.

  314. i found myself more baffled than outraged about some of the families line items, suchas the parents with two young children who spend 1,000 on groceries. what are they buying? and 400 on wine? are they having cocktail parties every weekend or something?

  315. My last comment in this thread. During the dotcom boom, I was (on paper) earning $800,000/year. I have also been homeless. I have been on food stamps. Rich is better than poor. But no two people agree on what “poor”, “middle class”, or “rich” mean.

  316. James Davis Nicoll:

    “Parody of how insular Americans are unaware about the degree to which Bush turned the US dollar into toilet paper or are you genuinely not aware of how far the US dollar fell wrt to the Canadian dollar since 2000?”

    Parody.

  317. Greg: The test went…lengthily, I’d say. The results should come out sometime within the next month; thanks for your well wishes in any event.
    Anyway, I must say I’m always struck by the length to which you go to expound your thoughts. Indeed, I’m a little at a loss at how to begin my response!
    Let’s see…Your consistent “libertarians’ fear” spiel reminds me of the “terrified” libertarian in “24 types of libertarians”, I gotta say. While I freely admit that many libertarians are afraid of govt. (though I think of it more as hostility/skepticism), there’s a great deal more to our mindset than that. I mean sure, I guess I’m “afraid” about what a powerful govt. *could* do, but as far as things that make me uneasy today in this country, the federal govt.’s intentions aren’t way up on my list, even when I’m in a cynical mood. These types of discussions almost always fall into one of two reals: “practical” vs “philosophical”. Allow me to formulate a general response to the points you make based upon the latter dynamic, since that’s largely what drives my sympathy towards libertarianism, selfish bastard that I am :)
    Leaving aside particulars (eg what constitutes a “commons”?), the points you raise are all valid. Above and beyond that, they apply to a community. And therein lies the rub. To my mind, such restrictions upon the members of a community can only be legitimately imposed if membership within that community is by a voluntary mechanism. Right now, that’s not the case. Unless you’re an immigrant, citizenship, with all its attendant privileges and responsibilities (which are entirely appropriate, mind you) is something that’s granted/imposed (pick your poison) by accident of birth. So long as that’s the case, I’d like to keep imposition of authority upon autonomous individuals to a minimum.
    That is to say, what draws me to it is not so much a fear of authority, but rather hostility to ideas people can be legitimately, say, forced to help each other. This is one reason I find “duty to rescue” laws so abhorrent, for example.
    You bring up the issue of copyrights and intellectual property. I do indeed have serious reservations about the concept; so too, for that matter, did Thomas Jefferson. As a pragmatist I realize the lay of the land lies against me here; yet and still, the only way I could philosophically accept the idea of intellectual property was if it were a privilege granted to citizens who have chosen to seek the protections of said citizenship. Does that satisfy you?
    To use a more relevant real-world example: the individual health-insurance mandate. Recognizing the necessity of maximizing the risk pool in providing coverage, I actually support the idea of requiring people to own health-insurance, so long as the have the opportunity to *opt out of the system*. Whenever this idea is raised (as have others, incidentally, such as Paul Starr and Peter DeFazio-D), invariably there are those who will respond “But some people WILL choose to opt out, and then if they get sick they might not get care!” In essence, we can’t allow people to make foolish decisions that might result in them getting hurt! The same sort of argument took place here in Florida a couple years back, in which a law was proposed that would (further) restrict the sale and consumption of raw oysters. The widow of a man who had died from Vibrio vulnificus was quoted saying, in support of the proposed law, essentially “I’ll do everything I can to keep what happened to my husband from happening to someone else”. NOT “if people get sick it’ll cost the taxpayers”, but “we have a duty to protect people from themselves”. It’s statements like these that make the libertarian in me come to the fore and want to scream “It isn’t your choice to make, dammit!”

  318. LE said to me, “So you don’t insure your cars or buy gas? or get them inspected, or replace the tires, or change the oil, or do repairs…”

    I would note that KIA’s post to which I was replying explicitly said, “We’re at $8k in expenses and haven’t even covered food, maintenance, insurance, gas and travel…” Insurance, maintenance and the like weren’t included in the $1k per month he was talking about.

  319. Most of the multimillionaires around here are software industry people, and software industry people don’t seem to care much about the outward expression of status.

    Oh, yes they do. That’s the whole point of having the newest bleeding-edge gadget when the last generation of gadgets works just fine. “We don’t care about shallow external things!” is one of those nerd memes that I can no longer hear without doing a coffee take.

    That said, there is a difference between actually spending money and the appearance of spending money. Nobody knows or cares that your designer suit came from a consignment store. Nobody is doing a spot-check of your home to make sure that your kids are wearing brand-new baby clothes from Nordstrom instead of old T-shirts. The Joneses probably just assume you have an expensive car and expensive electronics and artisanal cheese in your fridge, and they don’t know any different unless you TELL them.

  320. Greg, have you seen the blog I referenced? I suggest you lurk over there for a bit; you may be surprised. It’s definitely not standard Libertarian.

  321. @Greg: if you can’t even tell the difference between someone who wants a responsibly-sized government and an anarchist, there’s no help for you. It reminds me of an old saying: never argue with an idiot. They’ll drag you down to their level and beat you with experience.

  322. Amitava: The test went…lengthily, I’d say.

    If I might pry, what in god’s green earth requires a 16 hour test? At the very least, let me know if you did all right once you get the results.

    To my mind, such restrictions upon the members of a community can only be legitimately imposed if membership within that community is by a voluntary mechanism. Right now, that’s not the case. Unless you’re an immigrant, citizenship, with all its attendant privileges and responsibilities (which are entirely appropriate, mind you) is something that’s granted/imposed (pick your poison) by accident of birth.

    Way, way, waaaay back when, I had an idea for a short story where people living in a physical location could select which government they were part of. The idea that government is attached to a land border was viewed in that world was rather feudal. The story was set far in the future, and laws were enforced by androids. Androids, because to enforce the law, you had to know all the laws of all the governments who might have jurisdiction as you walk down the street.

    But the problem is that it simply doesn’t work in reality. It might be interesting to highlight that government is tied to the land, to shine a light on it, to raise awareness of it. But I could not actually figure out a way to make it work even on a basic level enough to make it believable. The only way I could figure out to make the story work was to make the world itself surreal, and I didn’t want to do that. I wanted to highlight something real. I worked on the idea for quite a while, but never solved that problem. And so I never wrote that story.

    The main problem is that “commons” doesn’t care what government you swore allegiance to. It doesn’t matter. A strategic move to solve a commons only works if it applies to everyone. Not everyone who swore allegiance to the government, but everyone who will interact in a certain set of circumstances.

    We can see this already when one looks at the issue with how China has a reputation as a piracy haven and no enforcement. Now imagine a physical world where you walk down the street and buy a music at a store that is aligned with a government that honors copyright laws like we know them today. And then right next door, is a copy-shop that is aligned with a government that holds copyright as nonexistent.

    It becomes a race to the bottom. The commons is the commons is all the people that are affected by the circumstance that creates the commons and government boundaries matter. Another example is air pollution. America is one of the biggest emitters of CO2 and that fucks over teh entire planet.

    The point of mentioning the short story idea is that I get what you’re saying about membership to the community. What government you are aligned to is, for 99% of the world’s population, merely an accident of birth that never changes in a lifetime.

    but that doesn’t make the problem of the commons or the problem of teh prisoner’s dillemma go away. And there is no other way to solve it than a strategic, community wide move. Air pollution is a commons and it can only be solved by regulation. And I’ve seen no solution to the issue of “membership by birth” that solves that problem without destroying any benefit that comes from the community solution to the commons and prisoner’s dillemma.

    what draws me to it is not so much a fear of authority, but rather hostility to ideas people can be legitimately, say, forced to help each other. This is one reason I find “duty to rescue” laws so abhorrent,

    But what does that mean if you’re in a Prisoner’s Dillemma? The best case outcome of the prisoner’s dillemma is not the best case possible. If nobody talks, then everybody walks after a year. But if you are silent and the other prisoner fingers you, you get 10 years in prison and they go free immediately. But if you both try to get out immediately by ratting out the other guy, you both get 5 years.

    The best possible outcome for everyone is that everyone shut up and everyone get out in a year. But the scenario provides a greater selfish reward if you betray the other guy. You get out immediately.

    Alice and Bob see this prisoner’s dillemma and decide that they will agree ahead of time that if they get caught in this prisoner’s dillemma, they’ll both remain silent. And they decide to put some money together to hire someone to enforce taht promise. If they get picked up and one of them rats out the other, the enforcer will imprison them for 20 years.

    Suddenly ratting out goes from getting out immediately to facing 20 years in prison. And the selfish individuals go for the action with the best individual outcome. They remain silent.

    Now, the problem is, as pointed out before, a problem of *membership*. It can’t be just Alice and Bob that agree to this. As soon as you get someone outside of the agreement, it falls apart, and we’re back to the every man for himself, resulting in everyone ratting the other guy, resulting in everyone getting 5 years. So, the only way to make it work, is to have it apply to everyone in the community. Have it be a law created by the people, for the poeple, saying that if anyone gets caught in the prisoner’s dillemma, the new regulation adds a 20 year punishment to anyone who rats. And so everyone remains silent and gets out in a year.

    It is a problem of membership because you and I can’t just come together and agree not to pollute the atmosphere. It doesn’t work. The coal plant has no incentive to NOT pollute. Because they’re already in the prisoner’s dillemma.

    That’s the difference between individuals and state. Via the state, you and I can agree beforehand that we’re going to make a strategic move to alter the game and remove the prisoner’s dillemma. But if we are already prisoner’s, or if we’re already trapped in a commons, for example if I own a coal plant, then I have no incentive to make a deal with you individually to stop polluting. And I would argue that you can’t *force* me to not pollute because I didn’t choose to be american, I was just born here and you shouldn’t be able to force me to not pollute.

    It has to be something done by the state. And if the state represents the people it governs, if it is a government by the people, for the poeple, then it can find moral grounding for creating these sorts of regulations.

    I actually support the idea of requiring people to own health-insurance, so long as the have the opportunity to *opt out of the system*.

    But this completely and utterly fails to recognize the problem of membership.

    Just let me “opt out” of whatever murder laws you have, and we are right back to the insolvable problem of my short story. If I align myself to a government that doesn’t outlaw murder, and you align yourself with a govenrment that DOES outlaw murder, but yet we get to occupy the same space, walk down the same streets, then it becomes a race to the bottom. I get to murder anyone I want, and you can’t do anything about it.

    Because, fundamentally, a law against murder has the same situation that a “duty to rescue” law has: they’re both imposed on people who were *born* into their citizenship. The only difference is you’re willing, for whatever reason, to impose a law against murder on everyone born into this country, but when we find a issue you don’t like (say a health insurance mandate with no opt out choice), then you raise the issue of membership. You didn’t choose to be american. You were just born here, and the rest of us don’t have a moral standing to impose our laws on you.

    But voluntary membership, or arbitrary membership, automatically creates a race to teh bottom. It automatically results in the guy with the fewest restrictions getting his way.

    And the thing is? This race to the bottom? I’ve talked with quite a few libertarians over the years, and I get the distinct impression that they’re stupid. I get the impression that even if they don’t understand the game theory of the Tragedy of teh Commons and the Prisoners Dilemma, I get the impression that they *clearly* understand that what they are proposing ultimately results in a race to the bottom.

    Because they think *THEY* are at the bottom. They think THEY are the most libertarian of us all. They think THEY have the fewest restrictions compared to mainstream democrats and mainstream republicans. ANd they figured out, if only subconsciously, that if everything is “opt in”, if “membership” into any solution to solve a commons problem is *optional*, then they figured out that they dont’ have to do anything they don’t want to.

    Thing is, if state membership is optional, then murder becomes legal. Laws against murder only work if it applies to everyone.

    Every libertarian I’ve talk with, and I mean *every* single one of them, solves the problem of membership creating a race to the bottom, by adding ad hoc rules to their libertarian philosophy. What they invariably do is start with a libertarian basis (at the very very bottom, i.e. no regulations but laws against physical violence), and then allow for just enough regulations that the race to the bottom, surprise surprise, happens to stop exactly where they are standing.

    So, yes, you are absolutely correct, there is an issue with having people born under the government that rules them. It is a problem of membership. But the solution isn’t to make membership compeltely arbitrary, the solution isn’t to have membership be opt in. Rather, the solution is to have the government be representative of the people, by the people, for the poeple, so that the government has moral standing. And then when people come of age and can choose that they don’t like their government, they can leave the land and find a different government. It really has to be assumed membership in, with an opt out option available. But to opt out, you have to leave the geography. because the world in my story is impossible to sustain. It creates an automatic race to the bottom.

  323. KIA: if you can’t even tell the difference between someone who wants a responsibly-sized government and an anarchist,

    An anarchist wants no government at all.

    Libertarians wants *exactly* as much government as he thinks is OK (and how much that is can be completely arbitrary and often is), but any more government than that is an evil imposition, a restriction without moral standing, and so on. Sure, they always start out with “as small a government as possible”, but invariably what they view as “possible” is always some arbitrary point that happens to exactly align where they are standing. And if they have to throw in a bunch of ad hoc exceptions to their Libertarian Philosophy about what is moral and philosophically grounded, hey, what the heck.

    I see the state as the only way individuals stuck in Tragedy of Commons scenarios and Prisoner Dilemma scenarios, can create strategic moves so as to avoid the tragedy part, or to avoid the worst possible outcome in the dilemma. If the scenario is such that selfish individuals create the best outcome, I’m all for it. If the scenario is such that it is a prisoner’s dilemma, then I support the idea of the people solving that problem through the state. Atmospheric pollution being one example of a commons. Private health insurance in America being an example of the prisoner’s dilemma.

    If the scenario is such that selfish individuals are incentivized naturally to reach the best possible outcome for everyone, I’m all for selfish individuals and no regulation getting involved in that scenario. I’m all for private enterprise. The engine of commerce is massively powerful. Greed for lack of a better word is extremely powerful. And Greed can be an extremely effective way to build a nation’s economy.

    But greed is not inherently good. It does not always find the best solution. The Commons and the Prisoner’s Dilemma are examples of selfish individuals ending up in the worst possible outcome. And in those cases, regulate it as a strategic move, alter the game theory scenario so that selfish individuals find the most rewarding individual path is also the most rewarding path for everyone.

    A libertarian, essentially, has no singular consistent moral grounding for their politics. They start with “government shouldn’t force anyone to do anything they don’t want to” and then they have to throw in a bunch of ad hoc rules to outlaw murder and physical assault, and a bunch more ad hoc rules so that the inevitable race to teh bottom their philosophy creates invariably stops right wherever they happen to be standing. And goes no lower.

    never argue with an idiot. They’ll drag you down to their level and beat you with experience.

    Well, I was never for a moment entertaining the idea that you would suddenly understand game theory and suddenly understand the issue of “membership” that Amitava and I were discussing above that stems from most Libertarian philosophy, and realize the error of your ways. I had it pointed out to me some time ago, that there is no point in arguing with someone to change their mind. The only thing one can hope for is to sway a few of the people who happen to be reading your shpeel, and point out to them the errors in your philosophy and point them in the right direction from there.

  325. I ran the numbers breakdown for a couple living on $200k in San Francisco, but it looks like the site ate it.So, in short, yeah. You can live on $200k/yesr in SF, but you will be in a two bedroom apartment instead of owning your own house, and youll probably have to send your kid to a day care that costs more than college, but its doable. You largely wont be living the life of luxury, though, by any strech of the imagination.Our tax code is structured to hose people in high income / high expense areas.

  326. @ Doc RocketScientist

    I hear for QFT the final looks something like this:

    http://en.memory-alpha.org/wiki/Kal%27Hyah

    I’ll find out next year.

    @ Greg

    You’re definition of libertarian is actually what is known as a minarchist. Not all libertarians are minarchist. You seem to have a strong set of preconceptions about libertarianism based on those libertarians with whom you’ve interacted. I’ve met some (mostly on the internet and some on this very blog) who fit that stereotype. For the benefit of all, I make a habit of ignoring them on that and related topics. Yet I’ve also met a few who do not, and I suspect Amitava is among them.

    Anyone who truly wants to maximize liberty must support the defense of natural commons and the protection of the fruits of individual labor (including sound intellectual property rights).

    In general the self-described libertarians who do fit your expectations are the ones with virtually zero knowledge of the actual history of libertarian philosophy. They are also the ones that routinely resort to snarking because they lack a foundation for what they think libertarian means.

    This video gives a quick précis of one of the two main branches of that philosophy (the other being libertarian socialism):

    http://www.youtube.com/watch?v=3FVpo57Ipjo&hd=1

    For a more in-the-trenches rational treatment of libertarianism as well as its opponents and critics, I recommend hanging out on this site for a while (just remember to take it all with a grain of salt):

    http://www.nolanchart.com/index.php

    Disclaimer: IANAL (I am not a libertarian), but I am a progressive with some libertarian-esque beliefs and an environmental conservationist.

    I like my government regulation like I like my code, tight, streamlined and carefully debugged. I think public works are a wonderful advent that can and should live side by side with free enterprise, and that the two can be mutually beneficial. I think that the public sector can and should leverage the power of free markets to achieve its goals. I esteem representative democratic republicanism, but I am also vigilant of the fact that it doesn’t always do what Alice and Bob tell it to, and that especially in large republics Crony Chuck can corrupt Warden Walter into screwing Alice and Bob over. Government is beneficial and necessary, but it is still the investment of power in individuals and not the direct Will of the People.

  327. BillK – Median household income in the City and County (same thing) of San Francisco is $55,000, according to the statistics I find.

    I’m not saying that many of those people aren’t relatively poor. But median being about 28% of your low end value seems off.

    (GPS VOICE) Recalculating…

  328. Does the phrase petit bourgeois have a different meaning in English ?
    By all French (Marxist, too) standards, the top 1% incomes have at least grand bourgeois status !
    (This is not to say that petit bourgeois mentality hasn’t contaminated the upper class
    — it certainly has, as you point out..)

  329. Gulliver: This video gives a quick précis of one of the two main branches of that philosophy

    Watched it. Transcribed it. Read the transcription. Trust me when I tell you that there is nothing new in this video that some other Libertarian hasn’t already said to me.

    At 2:18, it states the basis of all libertarian philosophy: Two people who exchange property voluntarily are both better off or they wouldn’t do it. This is wrong. Tragedy of the commons and prisoner’s dilemma are both models of situations that show two people who act in their own selfish interest and are NOT better off. They are far WORSE off.

    Libertarians do not understand game theory. And this statement right here is some libertarian trying to argue that game theory doesn’t exist.

    Starting around 4:06, it says this: You have the right to seek leaders for yourself but you havce no right to impose rulers onto others no matter how official are selected. They are only human beings and they have no rights or claims that are higher than those of any other human beings

    Yes, standard Libertarian philosophy here: “Government is just individual humans, so government should only be able to do what any individual human can do.” The only problem is that this is a FUNDAMENTAL FLAW of all libertarian philosophy. It is an example of the fallacy of mediocrity and is explained here:

    http://www.infidels.org/library/modern/mathew/logic.html#composition

    The example provided of this fallacy: “Humans are just animals, so we should not concern ourselves with justice; we should just obey the law of the jungle.”

    If you take the libertarian notion that “there is no such thing as society” and aim and fire it at government, you get “government is just individual people, and shouldn’t be able to do anything an individual can do”.

    A policeman can do all sorts of things when he is on duty that has moral basis. He can’t do those same things once he is no longer a cop, or when he is out of his jurisdiction, and so on.

    Libertarians ALWAYS get this wrong. ALWAYS. This is not something new or different from any other libertarian I’ve talked with or read. It is standard libertarian fare, and it is fundamentally flawed.

    At around 6:19, the video says this: 6:19: Problems in the world that arise from initiation of force by government have a solution. The solution is for the people of the earth to STOP asking government officials to initiate force on their behalf.

    This is actually the allure of Libertarianism. If you look at a lot of problems in the world, and if you apply Libertarian thought to it, you might reach the conclusion that Libertarian thought solves all those problems.

    Government enforced slavery? Libertarians say government can’t make anyoen do anything they don’t want to do. Government waste? Libertarians say government can’t force you to pay for anything you don’t want to pay for.

    The problem is that the solution that is libertarianism might appear to solve these problems, but it creates an even bigger problem: Government is optional for everyone. This was the problem I was discussing with Amitava at 12:04. It’s long, but hey, it took me almost half an hour to watch and transcribe that video you linked me to. And it deals with all the details of the problem, so it might be worth reading.

    In short, the problem is that making government optional becomes a race to the bottom.

    But an even more fundamental problem with libertarianism is that it doesn’t actually propose a design of government from which you can design a fully fledged operating government, or society.

    Libertarianism says “as small as government as possible”.

    If I were a student of aerodynamics, this would be like saying “planes should be as light as possible”. But that doesn’t actually tell me anything that helps me create a new aircraft design. It only informs me of why a design failed after the fact. An ultralight airplane has to be less than 256 pounds. A 777 is tens of thousands of pounds. If I build a plane that is too heavy for the engine or wingspan, “as light as possible” might tell me that the plane is too heavy. But it doesn’t actually tell me how to design it in the first place.

    Libertarian philosophy is insufficient to design government. It is a general rule like “an airplane should be as light as possible”, but that by itself says nothing as to what government should do. Which is *exactly* why libertarians like it. Because libertarian philosophy is a justification that can be used by anyone, no matter where they fall along the political spectrum to say that government is too big, and government should be as small as possible.

    Which means anyone can use libertarian philosophy to say, in effect, “any more government than what I want violates this rule of government should be as small as possible.”

    No. Really. There is nothing new in that video.

  330. @ Greg

    At 2:18, it states the basis of all libertarian philosophy: wo people who exchange property voluntarily are both better off or they wouldn’t do it. This is wrong. Tragedy of the commons and prisoner’s dilemma are both models of situations that show two people who act in their own selfish interest and are NOT better off. They are far WORSE off.

    Voluntary doesn’t automatically equal selfish. If two people do exchange property voluntarily then they are working in their own interests (whether those interests are selfish or selfless). If they are not, then the exchange wasn’t really voluntary or one or both of the parties lacked important information that, had they known it, they would have declined the trade. For one to understand how a superficially voluntary transaction can in reality be coerced one only need look at feudalism or, more recently, a Company Town.

    Starting around 4:06, it says this: You have the right to seek leaders for yourself but you havce no right to impose rulers onto others no matter how official are selected. They are only human beings and they have no rights or claims that are higher than those of any other human beings Yes, standard Libertarian philosophy here: “Government is just individual humans, so government should only be able to do what any individual human can do.”

    You and I interpreted that very differently. I take it literally to mean that rulers are not “more equal” than the rest of us. Their just power (and the power of any police or military forces they employ) derives from the consent of the governed; if the govern without consent (as ours are doing in Iraq right now), their power is unjust.

    This was the problem I was discussing with Amitava at 12:04. It’s long, but hey, it took me almost half an hour to watch and transcribe that video you linked me to. And it deals with all the details of the problem, so it might be worth reading.

    I’ve been following the discussion between you for some time. But I will go back and review that post.

    Libertarian philosophy is insufficient to design government.

    On this, at least, we are in complete agreement. Socio-political models are generally insufficient reflections of human society, which is why I look to them for information, not gospel. Some people read Das Kapital or The Wealth of Nations as sacred texts; I read them as enlightening economics texts with some good insights and some major flaws. The same can be said of my take of the major libertarian authors, activists and movements over the last two centuries from Belsham and Dejacque to the ACLU and my personal favorite, syndicalism.

    I have noticed that our approaches to understanding others differ in one key regard. You seem to focus on trying to understand reasons people have for their beliefs. I focus on the beliefs themselves. I’m not criticizing your approach. If it works for you, then good. My reason for trying to understand reasons people have for their beliefs only on an individual basis is twofold. One, because different people may arrive at the same beliefs for different reasons, and any conclusions I can reach about people I don’t personally know are necessarily speculative. And two, because I find it more useful to address the beliefs themselves which are they same regardless of why they are held. You could say I prefer to take a “Chinese room” approach to debating ideas.

  331. I’m back after a nice relaxing weekend. I take it I won and everyone admitted that it is just about envy?

  332. Greg: You know your reply to me was over two pages long. I’m not saying that’s bad, mind you, I’m just saying, you know. Have to admire the seriousness of thought you dedicate to this.
    The test was the USMLE Step 3, which is the, er, third step of the United States Medical Licensing Exam. The 16 hrs is broken down over two days, though, so it’s not as bad as it sounds.
    The idea that government is attached to a land border was viewed in that world was rather feudal.
    NOW you’re getting to the heart of the matter. I firmly believe that “territorial integrity” is always trumped, as a moral value, by self-determination, whether it’s of an individual or a group. And not to go too far off the rails here, but few things aggravate me more than how nearly every govt. will twist this concept to suit itself. The US govt. was willing to go to war with Serbia to protect the right of Kosovar Albanians to self-determination, while Russia was adamant that their fellow Slavs had the right to preserve their territorial integrity. Then, lo and behold, almost exactly ten years later (by sheer coincidence, of course) during the Georgia-Ossetian war, both the US and Russian govts. literally traded their positions, as if it were a game of musical chairs. You see this everywhere: Turkey with Kurdistan (territorial integrity!) vs Northern Cyprus (self-determination!), likewise the UK with the Chagossians (still prevented from going home, BTW) vs the Falkland Islands.
    Sorry, this still gets me worked up. I wouldn’t argue that one should be able to give allegiance to one govt. while living in the jurisdiction of another. That doesn’t mean, however, they can be prevented from refusing to swear allegiance to ANY govt. See the difference there? Or, to use your copyright example: let’s say that having the rights of a US citizen is conditional upon accepting the idea of copyright and patent law. And for those who choose not to be citizens, the law doesn’t apply to them. So far so good. The reason why I don’t see this as a problem (a race to the bottom, as you put it), is that these non-citizens could only exercise this right on their private property. Once they’d step off of it, they couldn’t legally sell their pirated material. Similarly, if someone were to buy it from them in their home, it would be subject to confiscation the moment they stepped foot on US soil again.
    “And then when people come of age and can choose that they don’t like their government, they can leave the land and find a different government. It really has to be assumed membership in, with an opt out option available. But to opt out, you have to leave the geography.”
    OR have the option of retreating to their private property and living there without interference (ie “Dumbfuckistan”, as my liberal friends always call it when we have this debate). If you step foot off of it, you’re treated no differently than a foreign national. Allow that clause, and we’re in agreement. Again, self-determination>>>territorial integrity.
    I think an issue here is what exactly defines a commons. Again, I don’t oppose environmental regulation because things like air pollution, as you rightly point out, generally don’t follow property lines and national boundaries.
    I understand the idea behind the prisoner’s dilemma, but the problem is that it presumes that the two people are in a mutually affective relationship to begin with. That’s not a presumption that I make.
    The only difference is you’re willing, for whatever reason, to impose a law against murder on everyone born into this country, but when we find a issue you don’t like (say a health insurance mandate with no opt out choice), then you raise the issue of membership.
    Some rules are fundamental and universal. I know, I know, I’m arbitrarily defining those rules in such a way that just happens to suit me. But look (and I might well catch a lot of flak for this), ultimately all codes of ethics and the rules that bind them are arbitrary. Some people say it’s immoral to eat meat. Others say it’s immoral to carry life insurance. To my mind the most logical and practical way of addressing this, then, is to find those few rules which are shared by everyone. Among these are “don’t murder”.
    At this point, allow me to state that I wouldn’t actually define the rules in such a way that just happens to suit me. I don’t live a very libertarian lifestyle, in point of fact. I’ve never tried drugs (don’t even drink, actually), I’ve never fired a gun, and take a rather hostile view towards prostitution (and the sex industry in general). Place me in 1000 acres in Wyoming with a drum of rice and beans, I’d still probably be dead in about 20 minutes. Heck, I even listen to NPR (though more for the music)! If I were ruling a country as absolute despot, everyone would probably be living like a Mennonite (with, uh, technology).
    Look, in all sincerity, I *like* the idea of a social contract. I’m grateful to be a US citizen, and would encourage anyone else to be so grateful as well. But it has to be their choice. To quote Lysander Spooner, PBUH (kidding!), a contract is only valid if it’s “signed” voluntarily. This leads towards the “non-aggression principle”, which I’m sure you’ve been lectured on. Which addresses your point: if “membership” into any solution to solve a commons problem is *optional*, then they figured out that they dont’ have to do anything they don’t want to.
    That’s exactly right. So long as you’re not harming anyone, you should be able to do whatever you want, and not have to do anything you don’t want to do.
    “What one should do”, “what one should be able to do”, and “what one should have to do” aren’t always the same thing.
    Gulliver: Actually I do like to think of myself as a minarchist. As much as I admire anarcho-capitalism, statists do raise a legitimate objection to it that I can’t overcome: in such a system, there is no way to absolutely preclude the possibility that, eventually, the strong will simply prevail and the weak will get trampled.

  333. Greg: I just realized I didn’t italicize your comments which I pasted. Sorry about that, I hope you can distinguish them from my responses.

  335. Kevin:

    I wouldn’t call it trolling. I’m not a 1%, but I plan on being one in a few years. I seriously just don’t understand all the anger over other people’s lifestyles and life choices. If someone wants to spend $800 a month on wine, more power to them and I’ll look into investing in a nice wine store in their neighborhood. If someone wants to spend $1000 on a stroller because it makes them think that their kids are little bit safer, go ahead. If someone wants to complain about not having enough left over after making all the lavish choices, go ahead and complain.

    I will agree that the U.S. political system is a mess, but it is still one of the best available. I agree that the U.S. tax system is no where near one of the best around, but I don’t see the point in being angry at those that use the system to their benefit instead of just purposefully paying more than they have to under the laws.

  336. Amitava: The test was the USMLE Step 3

    Cool. Hope the results are good when they come back.

    The reason why I don’t see this as a problem (a race to the bottom, as you put it), is that these non-citizens could only exercise this right on their private property. Once they’d step off of it, they couldn’t legally sell their pirated material.

    But this model of “private property” is insufficient as soon as we realize we aren’t just individuals, but a society. There are a lot more interactions that are societal that “private property” can’t solve.

    For example, FDIC. I love FDIC. If I let you create a bank, and you decide to save some expenses by NOT paying nto FDIC, you automatically get a commercial advantage over any bank that does pay into FDIC. If your bank is allowed to set up shop next to my bank, which has FDIC, my bank goes out of business because you can consistently undercut my prices. Which is all well and good, until there is a run on your bank. and a run on every other bank in the country, and every other bank in the country also “opted out” of FDIC.

    Because none of the banks have insurance, as soon as there is any sign the bank is in trouble, customers have incentive to pull their money out of the bank. But pulling money out of a troubled bank only guarantees the bank becomes MORE troubled. Positive feedback loop. And the bank fails. Guaranteed.

    Which would all be fine and dandy if the economic CRASH that creates somehow only magically affected your bank and your customers. But we are more than just individuals. We are a society. And when part of that society CRASHES, it affects everyone. It took a WORLD WAR to get us out of the Great Depression, that was sparked in part by runs on banks. And as a result of that, I have absolutely no moral qualms whatsoever having the government require every bank have FDIC.

    Libertarian philosophy says there is no such thing as society. That we are nothing more than individuals who just happen to live in the vicinity of one another. But the Tragedy of the Commons, and the Prisoner’s Dilemma, isn’t just some bullshit theoretical mathematical game. It is a model to understand real world problems like an Economic Crash and similar problems. And in those kinds of real world problems, the libertarian philosophy refuses to acknowledge that the “Commons” and the “Dilemma” spans far beyond the “private property” of two individuals.

    Put another way, this: So long as you’re not harming anyone, you should be able to do whatever you want, and not have to do anything you don’t want to do.

    Only works for Libertarian philsophy because Libertarians define “harming anyone” in the most limited, immediate, sense. A libertarian bank owner who decides to skip FDIC to lower costs would argue that he isn’t harming anyone because he refuses to look at the systemic effects of his actions. Because to a libertarian, there is no such thing as society.

    The Commons and the Dilemma in game theory is not confined to the banker and his customers. It encompasses society as a whole. Libertarians always hand wave this away and insist any damage from an interaction is limited solely to the individual actors. If a bank collapses, a libertarian will argue, it only affects the bank owner and the people who have money in that specific bank.

    And this is patent nonsense.

    Economies are not restricted to your private property and whoever you have contracts with. We are not each our own little economy operating independent of one another.

    If a bank crashes, it can affect everyone. If a stock crashes, it can ripple out to other stocks and affect everyone. The commons is not limited to the individual actors who made a single transaction that day. The Commons is everyone who is interrelated economically.

    Libertarians ALWAYS get this wrong.

  337. @ Greg
    The customers who chose to do business only with FDIC-insured banks would secure the benefits thereof. The customers willing to take the risk of doing business with an uninsured bank in return for the slightly lower fees the bank could pass onto them would not. Customers could and should then protect themselves by banking only at FDIC-insured banks. Some would behave irrationally and take the risk. Some people bank with B of A and it’s ilk even though they could go right down the street to a local credit union and not get screwed over and under. Credit unions (mine included) still stay in business.

  338. “Median household income in the City and County (same thing) of San Francisco is $55,000, according to the statistics I find.”

    Median income in SF is now $70,770, you were lookng at the 2000 data. Yes, it’s gone up that much in 10 years

    Lots of rent control in SF, also a fair amount of assisted housing. The distribution is highly skewed. Also there are many people who bought homes when things were significantly cheaper. i think the quote should be “people who moved to San Francisco today…”

    data
    http://www.city-data.com/income/income-San-Francisco-California.html
    http://www.city-data.com/city/San-Francisco-California.html

  339. Gulliver: Customers could and should then protect themselves by banking only at FDIC-insured banks. Some would behave irrationally and take the risk.

    This completely ignores that individual transactions can result in bank runs, which harm the entire bank. And that a bank failure can harm the whole economy.

    This is a myopic view, common among Libertarians, that the “harm” of any transaction is limited to the individual transaction. You are not your own little independent economy. And I am not my own independent economy. You and I are part of the same economy. The Tragedy of the COMMONS is not about two people in a single transaction, but EVERYONE who is part of the economy. The Prisoner’s Dilemma isn’t about the two prisoners who happen to be in prison at the moment. But rather is a model to deal with a situation where EVERYONE is a prisoner, and everyone can make decisions which affect others in negative ways.

    This is the way Global Warming people deny global warming is real. They focus on the weather. Weather is not the same as climate. Global warming is about climate change. We can have a blizzard with 20 feet of snow and could still have global warming going on.

    You withdrawing all your money from a bank is an individual transaction. An individual transaction is not the same as the economy. The tragedy of the commons and the prisoner’s dillemma actually refers to everyone in the ECONOMY, even though it is a parable about two people in an individual transaction. Alice and Bob share a commons. Alice and Bob are imprisoned and can either testify against the other or remain silent. But those are models of individual transactions that can be expanded to encompass an entire economy. But a single transaction is not an economy.

    And this is something Libertarians consistently refuse to acknowledge as missing from their worldview.

  340. It seems to me that there are two competing threads, here:

    1) People who make more money than 99% of their fellow citizens sometimes have difficulty with it and make excuses / get defensive. The whole article reads like an excuse to me. “WE NEVER HAVE ANYTHING LEFT AT THE END OF THE MONTH”. This could be more the author, fomenting discontent (aren’t they execrable, wink, wink!), but the participants released their budgets, knowing how they would be viewed by the 99% who make less.

    2) Budgeting appropriately isn’t easy and sometimes it is literally impossible. It is not impossible for these people, and, personally, I think a number of their choices are extremely short-sighted. But they will be okay! I am more worried about the people who cannot feed their children a healthy enough diet so their brains and body can develop so they are ready for kindergarten. For those who’ve worked hard and lost their jobs and are homeless. Budgeting for them, as described here, is impossible. I don’t know if it is naivete, simple cruelty, or maybe some schadenfreude. All of us could be in their place. Some believe that it is their own bootstrapping that avoids it; sure! You can do things to protect yourself and your family. But there are plenty of examples where they did everything right and still ended up in trouble. I used to volunteer at a free clinic that operated at nights. Who did we see? The indigent? The drug addled? The lazy? No. Almost entirely working poor, who couldn’t afford any other health care. For whom missing work might mean no job and, ultimately, no place to live. They are the ones we should think about when we talk about budgeting, safety nets, and the like.

  341. $800 a month for wine? That would keep my husband in Trader Joe’s Three Buck Chuck for … it’s Monday and math isn’t my friend, but a loong time.

    Anyway, it’s not about what people spend money on. If you want to drop $1000 on a baby stroller or a gold plated toilet bowl cleaner, go for it. But if your penchant for over-priced chachkes makes it difficult to live on $200K, you’re an idiot.

  342. Bravo, Kirby. I think that is the first time I have ever see anyone call someone else an idiot online without writing “your an idiot”.

  343. If someone wants to spend $800 a month on wine, more power to them

    And that is still not the problem. If you spend $800 a month out of your income and then COMPLAIN that you can’t make ends meet, because your income is actually insufficient for such a habit, people are not exhibiting envy, they’re exhibiting that they think you’re a bloody idiot.

    It’s the same degree of Chutzpah required as to throw yourself on the mercy of the court because you’re an orphan while on trial for killing both of your parents!

    Likewise, whether or not you want to be in the 1% doesn’t come into. Something like 75% of the US population think they will make it into the 1% when… hmmm… (counts on fingers) oh year, LOTS DON’T.

    Having been in the 1% myself, it’s all fine and dandy, and you’d have to be a total klutz with your domestic budget to be living month to month on that kind of income. In fact, it took us 6 months of unemployment and 2 years of starting a new business to get to that stage.

  344. mythago @ 9:26 PM That’s the whole point of having the newest bleeding-edge gadget when the last generation of gadgets works just fine.

    No it isn’t. The point of having the newest bleeding-edge gadget is having the newest bleeding-edge gadget.

  345. Kilroy says: February 20, 2012 at 11:21 am
    I’m back after a nice relaxing weekend. I take it I won and everyone admitted that it is just about envy?

    No. But that’s a brave attempt you’re making there.

  346. @ Kilroy–“If someone wants to spend $800 a month on wine, more power to them and I’ll look into investing in a nice wine store in their neighborhood.”

    Daveon typed a very good response to this. It’s not about envy. It’s not about telling other people what they can spend their money on. It’s about very little sympathy with someone kvetching that they just are sooooo poooooor because they can’t make ends meet on $200,000 a year with expenses like two houses, wines, designer clothes and brand new high-end cars.

    Well, *I’m* making ends meet and my wife has been out of steady work for going on three years now (and we even recently finished saving up enough money to buy a new Ford Focus). We’re surviving because we *budgeted*. We lived *below* our means to save up for when our means were low.

    Yes, I’d like new clothes. I’d like vacations that take me farther away than Boston. I’d like to re-paint the inside of my house and replace the 1994 Saturn Sedan. But I can’t afford that and *I’m* not kvetching about how I’m sooooo pooooooor and deprived and nobody understaaaaands how hard it is.

  347. I just wonder who exactly was doing this “kvetching” and under what circumstances?

    If a reporter comes and asks you whether you feel rich on 200K/year because they are doing a story on it, a wise man would tell the reporter to go away sure, but whatever feedback a less wise person would do is solicited, Is answering a question bitching? It’s not like they are going down the street with a sign…

  348. Unholyguy,
    It seems to me that there wasn’t all that much kvetching. At least, not on the part of the people who provided budgets.

    However, Jonathan Kay’s essay includes “They’re all comfortable, but nobody is living large,” and “That’s no small amount of money, but hardly the means for a life of leisure.” He’s trying to give the appearance of people who aren’t any better off than the rest of the world.

    In his attempt to find five families that would prove the point in his essay, he ended up with five families that are wasting their money. And by “wasting their money,” I mean that I can spot places in their budgets that need a careful look, in spite of not being a financial adviser.

    The reason they don’t have anything left at the end of what they earn in a month isn’t because of the cost of living – it’s because they’re spending too much on what they think is the cost of living.

    When I boil it down, that’s the main problem I have with this article – it’s trying to prove a point, and failing miserably. These people are penny-foolish and pound-foolish. They’re free to do that, of course. But they aren’t proving the point of the article.

    At best, this is a failure to select well; perhaps Mr. Kay should have looked harder to find his five examples. At worst (and, in my opinion, most likely), it’s indicating that a six-figure income really is impressive, and the only problem is that people who waste their money exist at all income levels.

  349. I think they are trying to explain that 200K a year is not mansions and yachts and private airplanes, which it isn’t. No matter how well those people manage their money, they are not Mitt-Romney rich. One of the problems is that “rich” is really poorly defined colloquially, another problem is the Mitt-Romney rich people are trying hard to turn attention away from themselves.

    I do agree on the points about wasting money and bad budgeting. You find that at all income levels though.

  350. unholyguy says: February 21, 2012 at 1:31 pm
    I think they are trying to explain that 200K a year is not mansions and yachts and private airplanes, which it isn’t.

    The language used in the article doesn’t exactly support the point you say they’re trying to make.

    “Almost Rich: an examination of the true cost of city living and why rich is never rich enough”
    “In an increasingly pricy city like Toronto…$196,000 can seem positively middle-class.”

    Maybe I’m weird, but middle-class doesn’t sound like:

    wine at $11 per bottle
    $5,000 on a table and Eames chairs
    “a new Mercedes every three years”
    a “four month trip to Myrtle Beach”
    $1,750 rent
    $10,000 per year for travel
    $1,600 per month on groceries for a family of four ($400 per person per month. That’s about three times my average.)
    a three bedroom home and a Georgian Bay cottage
    $1,000 per month on clothing
    or $7,000 per year for vacations.

    Any one of those would be making me question how a life can “seem positively middle-class.”

    No, it isn’t all champagne and caviar at $150,000 to $200,000 per year. But it isn’t middle-class. And if it isn’t rich enough, it’s not because of “the true cost of city living.” Not for these examples.

  351. Middle class, by definition, certainly isn’t in the top 1%. These people are not middle class, they are upper class.

  352. What rich is, is irrelevant. What you spend your money on or where you choose to live or what you do with your career are all irrelevant. Statistically, these people’s declared taxable income puts them in the 1%, which means they are not in the middle. If you’re in Canada, the prices are higher despite the increase in Canada’s currency and they pay much higher taxes than the U.S. but the 1% of Canada are still getting tax breaks and financial advantages well above what the 99% are allowed. And that tax in Canada — a gigantic sales tax on not only most goods but also almost all services — means that the 99% are paying the same high taxes on everything they need without being in an income bracket where they can easily afford such things as plumbers, medical services, gas, etc. And those who are in the 1% are more able to pay cash for services and avoid sales and other taxes, a big under-economy in Canada and a growing one in the U.S. that we’ve seen many high profile I didn’t pay my nanny/housekeeper/gardener taxes scandals on. The measure is not what you buy but your income, your resources, and your tax situation, allowing you a disproportionate ability to increase your net income and to save and invest should you so choose, (while blocking through legislation the ability of those with lesser incomes to increase theirs.) In other words, it’s not what you do with your money, it’s what you can potentially do with it. Potentially, these people can do quite a lot. You cannot escape basic math by pleading social conventions.

  353. I’m back after a nice relaxing weekend. I take it I won and everyone admitted that it is just about envy?

    I don’t know if you noticed, but our host has already indicated he’s had a very far from nice relaxing weekend, and is in no mood for Mallet-worthy nonsense. Please don’t troll the thread, Kilroy.

    Just for any FYI, one more time. I don’t envy J.K. Rowling being in the 1% of the 1% of authors. Good on her if she can (reportedly) afford to buy a multi-million dollar holiday home in Australia. But if she starts whinging to journalists about how hard it is for her to make ends meet, expect a hearty round of “bitch, please…”

  354. i would say 200K/year in Toronto would qualify as lower-upper class. What you have here is a bunch of people who have managed to transform themselves from lower-upper class to upper-middle class through mismanagement of money. Oh, the humanity (-:

  355. @Kat, I think one of the takeaways at least for me is that looking only at taxable income as a definition of wealth is:

    1: Stupid because it ignores cost of living differential (which can easily be a x3 multiple)
    2: Stupid because it ignores control over assets and associated capital gains (both personal assets and solely owned corporate assets)

  356. Unholyguy: Again, what is wealth is irrelevant. Defining whether you are wealthy, rich, well off, comfortable, whatever word you want to use, is irrelevant. It is unimportant what you call people with money resources. The only important thing is the level of the actual money resources they have, not what they will spend the resources on.

    The cost of living differential is a choice that a person or family is making and usually because they have the resources to choose, and so it is not part of actual income power of a family relative to others in a country. It’s an extraneous expense. Sometimes people are choosing an expensive place to live because it maximizes income. But that’s again a choice to make. Someone may choose lower pay to live in a less expensive area where their money will go further. Someone may invest in stocks or bonds. It’s not a relevant variable to the math. The only factor is whether they are or are not in the 1%, statistically at the top or not. Control over assets is part of financial resources and so was not being ignored. However, even when people don’t have full control over their assets in corporate stock, etc., they still have it as a type of financial resource and it gives tax and financial advantages because they are in the 1% rather than a lower group. It maximizes their income power and maximizes financial and tax advantages because of their income power which increases income power.

    I help several relatives at considerable expense to my family. That’s a choice I make. I have a pet and used to have three. Their food and vet bills have been a sizable expense. That’s a set of choices my family made. The choice of where I live and in what domicile I live is no different. It is voluntary and therefore it has nothing to do with how much money I have. Where I live is simply what I’ve chosen to do with my money. They aren’t the same thing. The 1% can complain about the high cost of the city they chose to live in, given that costs in the cities are probably overpriced. But that city is irrelevant to the fact that they’re in the 1%. So arguing that the 1% statistically who choose to live in Toronto or San Francisco are somehow to be classified as different from the 1% statistically who choose to live in less expensive places is a meaningless argument that articles like this one keep trying to pretend is important (as did the lawyer who got all the flack.)

    Being in the 1% is not determined by any of your expenses. It is determined by your income and assets placing you higher than 99% of your country’s population. It’s basic math. And if you are in that 1%, no matter where you live, no matter what is going on in your life, no matter whether you spend your money on homeless shelters or expensive bottles of wine, the people in the 99% income level will not care about your problems, unless forced to due to their jobs. Ever. It’s the belief that the 99% should care that causes the outrage from the 99% about articles like this, not that a person has more money than his fellows. That and the fact that the media thinks it’s so cool to get eyeballs that they’ll print any propaganda whining about it.

  357. @Kat, the type of wealth is very relevant when you are actually making changes to the tax code, or trying to do anything abut it except whining and carrying signs around.

    For one thing, assets (as opposed to income) have this nasty tendency to fly away overseas when you try to tax them. They are migratory that way.

    I do believe that “the 1%” should be defined as total wealth (income + capital) that is not however how the media seems to be wanting to define it. You also get an entirely different set of people when you do it that way. A lot of people that are in “the 1%” if you go by income are no longer in it if you go by Total Wealth, and vice versa.

    As far as high cost versus low cost of living, I don’t know what world you live in, but the world I live in has the following characteristics
    1: Most people do not move very far away from the place they were born, because of this thing called “family”
    2: When they do, they usually do it for a job, and it is not always by choice
    3: High cost of living areas are the way they are because of all the people living there, if everyone moved somewhere else all it does is move the problem

    For yourself, why don’t you move to some third world country? That is entirely your choice right? Your money would go a lot farther then correct?

    The problem with “basic math” is it often “wrong math”.

  358. OMG Kate, and everyone else trying to educate us about the math of the top 1%. We got it. Yes, there’s no argument, the top 1% is good. It’s great, in fact. But it’s not AMAZING. And it’s not even very RARE. For every 100 people you have a 1%’r (see me educate you on math there) so if you are in any given department store the chances are pretty good a 1%er is around. And at any given televised sporting event you probably have hundreds of them around. Yes, roaming free!! These people are NOT celebrities. Or especially wealthy. These are normal people. And they have the normal human tendencies to budget poorly. Just as many of the 99% budget poorly. The thing that bothers me is all this OUTRAGE at people in the 1% and their sometimes bad choices. Everyone makes bad choices. Everyone overspends. But it’s not a function of being in the 1%, it’s a function of being human. They don’t deserve your WEALTH RANT. Most of them aren’t THAT well off. We don’t need the mob come out and CONDEM them. Clearly y’all in the 99% covet their 1% earning power. Just try not to make it so obvious. Don’t loose compassion for a person because of their money. It makes your enlightened mind appear petty, hypocritical, and brimming with envy.

  360. I can explain the hair salon item for the immigrant family.

    Black women with processed/relaxed/chemically straightened hair are considered more professional than women who don’t. They are more respected at work and they make more money.

    The straightening is usually done every 4-6 weeks and costs (in the US, not sure about Canada) from 80-200 dollars. Then there are the deep-conditioning treatments (chemical services are very damaging to the hair) for 25-50 and the haircuts/trims (sky’s the limit, there, really). Then, because she has two grown children, she is probably in her forties or fifties and may be coloring her hair as well, so another 50-150 there.

    Four hundred dollars a month, particularly for a woman in her financial bracket, is not actually that much. There are women who spend ten times as much (no, seriously, I’m not exaggerating) and bring home a lot less money than that family.

  362. if you are in that 1%, no matter where you live, no matter what is going on in your life, no matter whether you spend your money on homeless shelters or expensive bottles of wine, the people in the 99% income level will not care about your problems, unless forced to due to their jobs. Ever. It’s the belief that the 99% should care that causes the outrage from the 99% about articles like this, not that a person has more money than his fellows.

    I just wanted to pull this out because I think it’s a statement that a lot of the apologists for the well off should really take to heart. There’s an undercurrent in this thread that it’s about anger or jealousy. It’s not. It’s about the very well-off thinking that they somehow deserve our sympathy for their financial issues. They don’t.

  363. Rick I don’t think anyone is asking for sympathy so much as getting tired of being vilified for the sins of a bunch of multi zillionaires.

  364. surfwax: The thing that bothers me is all this OUTRAGE at people in the 1% and their sometimes bad choices.

    Really? This complete strawman is what bothers you? all this OUTRAGE isn’t being directed at the 1% for bad choices. The outrage directed at the 1% is usually due to them paying some of the lowest taxes they’ve had in a century and having to listen to them bitch that it just isn’t fair and they should even pay less.

    Jesus.

    unholyguy: The top 1% of income earners are very well off, should be taxed more. It would be nice if such taxes took into account cost of living, but I am dreaming there and I know it.

    Good lord.

    Rick I don’t think anyone is asking for sympathy so much as getting tired of being vilified for the sins of a bunch of multi zillionaires.

    They are getting villified because they are paying some of the lowest taxes in nearly a century and the country is falling apart and the government is cutting important services so millionaires can spend more time with their money.

    And only an exceptional few have made a point to come out and say ‘we should pay more taxes’. Warren Buffet. John Scalzi. Anyone else? If you’re in the top 1%, paying the lowest taxes in ages, watching the country go down the toilet, and saying nothing, then shame on you.

    And shame on the sychophants like the shmuck who wrote this article in defense of the 1%.

  365. “One of the problems is that ‘rich’ is really poorly defined colloquially…”

    I would posit that “rich” is actually well-defined. “Rich” is “anyone making more than me”.

    And “anyone making less than me” is “lazy”.

    Those definitions may not be accurate, but I think they’re pretty widely used.

    It’s sort of like George Carlin’s observation about other drivers: Anyone driving slower than me is an idiot, and anyone driving faster than me is a maniac.

  366. Unholy Guy: “For one thing, assets (as opposed to income) have this nasty tendency to fly away overseas when you try to tax them. They are migratory that way. ” — Yes, that’s part of the resources included at that level for total income growth. I understand what you’re saying about how if you add in hidden assets, those at the bottom of the 1% might no longer be part of the 1%, but since the resources and assets are often hidden and obscure, (which is indeed relevant for tax code but not for the subject of the article,) these people are still mathematically in the official 1%. And their requests that those who are not at that income level should care about their expense problems and support the continuation of special tax and financial advantages they receive for being in the 1% and having those resources — including considerable tax and financial advantages they receive from these cities themselves — is a hopeless and ridiculous request. And they do make those requests — requesting us to sympathize about their high cost of living, requesting us to therefore support them receiving tax cuts and capital gains tax cuts that others below them in income, assets and resources can’t get, requests that we not criticize them or regard them negatively in any way. no matter what they say about people outside the 1%. As Scalzi points out, it takes an awful lot of chudspah to make those requests and make them publicly in the press. To then be surprised or upset when people are offended is highly unrealistic. A person doing so is demanding sympathy for his plight of expenses while showing no sympathy for the more serious plight of people with lesser income. It’s, what’s the word, insensitive. Also a touch sociopathic, but I’m willing to extend them the benefit of a doubt on that.

    “1: Most people do not move very far away from the place they were born, because of this thing called “family”
    2: When they do, they usually do it for a job, and it is not always by choice
    3: High cost of living areas are the way they are because of all the people living there, if everyone moved somewhere else all it does is move the problem”

    Those are all choices, including living in another country, like my friend in Argentina. It is always a choice to take a job or not; though it may be a desperate choice. At that income level, it seldom is, but health insurance can be an issue in the U.S. And they’re irrelevant in requesting that those who make less than you sympathize with the consequences of your choices while having no interest in their problems. I have no anger towards these people at all, though I don’t think they’re particularly bright. (Scalzi seems a bit peeved at them though.) I’m just saying that if they want all of us to sympathize with them, which seemed to be the part of the article, it’s not going to happen.

    Surfwax: “The thing that bothers me is all this OUTRAGE at people in the 1% and their sometimes bad choices.” — You missed the point of my post and brought up an example of exactly what I’m pointing out. The outrage is not that these people are in the 1% or that they make bad choices. The outrage is because these particular people (who do not make up all of the 1%) want us to sympathize with them and continue to support giving them special tax and financial advantages that they prevent us from also having and that have a negative effect on our lives and economy, while dismissing the situations of the income levels below them that are more critical. It’s not envy over their wealth, it’s annoyance at their callousness and self-involvement. And annoyance further that these people believe that you should not boggle over their wine expenses or say anything negative about their behavior towards others who have less than they do, or the system that helps them and punishes people with lower incomes. Your comment is an example of the outrage many in and outside the 1% seem to feel that those with less dare speak about their betters. And that attitude indicates that they don’t see themselves as ordinary people like those with less, but that they regard themselves as special people who deserve not to be criticised while they are criticizing a working poor single mother for occasionally buying her kids a snack.

    “I don’t have as much as a millionaire” is an insensitive and rather nasty thing to say to people who are getting by — often living in the same expensive cities — on $30,000 a year for a family of four. And a negative reaction to that insensitivity and to the demand for sympathy that comes with it is not envy. My point is that there’s no point getting hung up on defining who’s well off and who is really, really rich and who can live in a city more comfortably for the purposes of requesting sympathy. Because whether you have $200,000 a year or are worth $5 or $40 million, you aren’t going to get that sympathy. And if you’re insensitive enough to insist you deserve it, then don’t be so freaking surprised that people don’t tug their forelocks and pat you on the back like you want.

  367. @ Surfwax

    Everyone overspends. But it’s not a function of being in the 1%, it’s a function of being human.

    Spoken like someone who’s never worried about his next meal. Try spacing your meals just far enough apart that you get enough protein to avoid migraines so you can concentrate on getting your work done. Not everyone has the luxury to overspend. Some of us actually had to learn a little self-discipline in our lives, so watch where you swing that everyone of yours.

    I’m not in the top 1% percent, but I am in the top 5% and I’m a thankful enough that I don’t go around whining about how hard it is to stock my wine cellar (not that I care for wine). Because I’ve gone hungry when I was younger, and I have enough perspective not to bitch about being in the upper-middle class. You’re bothered by people venting their indignation when members of the upper-class play the victim? Perhaps you spare some of that condemnation for requiems on the travails of $1,000 strollers.

    I’m a capitalist. I’m fine with people earning more than me. I’m not even particularly motivated my monetary gain. But I’ll be damned if I’m gonna listen to you tell me I should bite my tongue when someone with more money than sense tells me how hard their life is!

    Clearly y’all in the 99% covet their 1% earning power. Just try not to make it so obvious.

    Clearly you don’t have a clue about what this thread was actually criticizing. Just try a reading comprehension class.

  368. I have many many friends in the “1%”. Every single one of them is in favor of being taxed more. Most of them vote democrat. None of them have a private jet. They are not very different from the 2-3% income brackets, or the people in lower cost of living areas that actually have more buying power though they earn less.

    No one wants to be sympathized with. Most of them just want to be left alone or to do their part in pulling this country out of the mess it is in.

    However I am not taking responsibility for the shape the economy is in. Everyone had their hand in that, and the truly guilty people are more then a little higher up the food chain then me. I am not your enemy.

    We are all guilty for the shape the economy is in. I will say it again. All. Guilty.

    Who elected the Republican assholes who got us into this mess? It was not “the 1%” that voted that douchebag Dubya into office twice. It was Florida. And Ohio. Who is out there cheering Rick Santorum right now? Who took the mortgages they could not afford? All guilty.

    The actual criminals and multimillionaires are busily giggle themselves insane as they get off scot free (again) while we all fight with eachother over a new income tax bracket it that they will never ever pay. Why? Because they don’t pay taxes. Not any. Not ever. So raise it to the moon for all they care.

    You are all being played, articles like the one Scalzi quoted are part of the the propaganda that is playing you. Why was that article written and others like it? To set up a straw man and a distraction for the proles. To aim the class warfare energy at the appropriate targets.

  369. @Kat so I am guessing that your philosophy is we should not feel sympathy or empathy for our fellow men because everything that happens to them is a result of the choices they make? Am I reading you correctly, cause that is a tough philosophy to live by

  370. unholyguy: I have many many friends in the “1%”. Every single one of them is in favor of being taxed more.

    Just how *effective* are these friends of yours? Did they get into the 1% strictly through inheritance? Or did they demonstrate they could get things done themselves when they put their mind to it? Because what I’m seeing is a world of not-getting-things-done in the realm of fixing taxes.

    If wishes were horses, beggars would ride.

    Most of them vote democrat. None of them have a private jet. They are not very different from the 2-3% income brackets, or the people in lower cost of living areas that actually have more buying power though they earn less. No one wants to be sympathized with.

    And yet, there you are, sympathizing. People in lower cost of living areas have more buying power than your friends? Oh the inhumanity.

    We are all guilty for the shape the economy is in. I will say it again. All. Guilty.

    All. Guilty.

    My. Ass.

    People who don’t want to play the blame game, are usually the ones to blame. And a great way to avoid the blame game is to say everyone is to blame (and therefore no one is to blame any more than anyone else).

    You are all being played

    Sympathizing to the rich, blaming the victim, and now, condescending.

    I can’t imagine why the 1% gets such a bad rap. I mean, look at the great PR you give them.

  371. unholyguy says: February 22, 2012 at 1:19 am
    We are all guilty for the shape the economy is in. I will say it again. All. Guilty.

    Who elected the Republican assholes who got us into this mess? It was not “the 1%” that voted that douchebag Dubya into office twice. It was Florida. And Ohio. Who is out there cheering Rick Santorum right now? Who took the mortgages they could not afford? All guilty.

    I haven’t voted Republican in my life, I voted against George W. Bush, I don’t like Rick Santorum, I could afford my mortgage when I got it, and I’m well aware that this article is so much manure.

    Any questions?

  372. I’m in favor of a massive inheritance tax, I think I would tax it all over the first half million or so. The rich people I know entirely made it by working in the tech companies.

    Originally the protests and outrage was focused on Wall Street. Wall Street, remember them, guys who actually wrecked the economy with all the shady dealing? This was a little diconcerting to Wall Street. The proles were acting up, might actually do some damage, Enter the PR machine. Now suddenly, magically, it’s everyone who makes over the magic number. Which is an entirely different set of people from the Wall Street crowd.

    It was a very nice piece of slight of hand. Now everyone is fighting with eachother rather then going after the bi banks

    However since most Americans don’t actually understand how money works, what Wall Street is, the difference between income and capital, it’s all just “a bunch of rich people” it’s not that difficult to fool them

    Now wait for the “compromise”. Raise income tax a couple points (which is probably not enough in my opinion). Do nothing else. Capitals gains will remain at record lows. Wall Street laughs all the way to the bank. As usual.

  373. wow. I didnt realize I had it all wrong. Turns out the people in the top 1% but who do NOT work on Wall Street are the real victims.

    “capital gains will remain at record lows”

    it would be interesting how much of your friends money came from w2 income and how much came from tech company stock options. and low capital gains stock.

    but I am sure they are still very much the victim of all this. I feel compelled to send over someone living below the poverty level just so they can apologize to your poor rich friends.

  374. If you are a engineer with 8+ years of experience at a publuc top tier silicon valley company , like say Facebook or google or Netflix , your compensatin is generally in the 200k range. This comes generally from a combination of salary, bonus and RSU’s (restricted stock units). All of this is taxed as income, even the stock, there is no way around it.

    Two of those engineers get married, they are in the top 1%

    If you are in a regular silicon valley tech company comp is usually lower, in the 150-180 range, however it is still possible for a couple to hit the 1% marker if one of them is a top performer, bonuses are fluid

    If you are in a startup your salary is lower, your bonus non existent, however you have options. Options open the door for capital gains tax, if you hold them for 3+ years. They also might be worth nothing of course.

    Note there is no barrier to entry for anyone getting one of these jobs other then being damn good at computers and willing to relocate. Even the college degree is optional.

  375. I also don’t know a single person who has the $8.4 million in capital required to be “in the top 1%” from a assets perspective. At 8.4million on a 5% return you are earning $420K/year just on appreciation without raising a finger. And it is taxed at 18%

  376. @ Greg

    wow. I didnt realize I had it all wrong. Turns out the people in the top 1% but who do NOT work on Wall Street are the real victims.

    That’s not what Unholyguy said and you know it because you’re intelligent and obviously diligent. He supported raising taxes while also pointing out that that alone won’t fix the systemic corruption that allowed a handful of financial services firms to cripple the global economy. Do you disagree with that? After all your focus on the Prisoner’s Dilemma, I find it hard to believe you want the status quo to keep doing business as usual, buying dirty politicians that bail them out no strings attach them they nuke the economy.

    @Unholyguy

    If you are in a startup your salary is lower, your bonus non existent, however you have options. Options open the door for capital gains tax, if you hold them for 3+ years. They also might be worth nothing of course.

    One of the best ways for a startup without a lot of cash to recruit good talent that won’t walk as soon as they get a slightly higher salary offer is to include stock options as part of the bonus. It gives them a stake in the company’s success and helps filter for engineers with confidence in the product you’re trying to develop.

  377. Unholyguy: “I am guessing that your philosophy is we should not feel sympathy or empathy for our fellow men because everything that happens to them is a result of the choices they make? Am I reading you correctly, cause that is a tough philosophy to live by.”

    — I’m not sure whether you are misreading me or deliberately trying to paint me as a cold hearted bitch because I have more sympathy for people with more serious problems than the people in the article. I think I will go with the former, because you don’t strike me as a conservative trying to do the latter. But you are playing apologist. As you can clearly see, I did not say that ALL the people in the 1% demand sympathy for their problems. I did not say that any people in the 1% are bad people. I said that when SOME of the people who are officially in the 1% demand sympathy for their problems which result from their deliberate and voluntary choices and then complain insensitively that it’s an outrage they aren’t getting that sympathy from people poorer than them, they’re out of luck.

    And you share that understanding. You’ve already mentioned several times that you don’t care much about those multimillionaires that you feel caused financial disaster. But shouldn’t you have sympathy for their problems, like how much it costs them to live the lifestyle they have to for their businesses and jobs in say expensive Beverly Hills, Los Angeles because they are also ordinary people? And yet, you, in the bottom of the 1% or like me towards the top of the 99% oddly enough don’t care that much, nor are likely to accept the outrage of the multimillionaire that we don’t care that much about as justified. So why is it hard to understand that someone making $30,000 is not going to be sympathetic to the problems of someone making $200,000?

    You say that everyone in the bottom of the 1% just wants to be left alone, not sympathy. But there are two problems with this. #1) The people in the article are not like your friends in the 1%. If they just wanted to be left alone, they would not have been in the article. They want people to sympathize with them and not say anything negative about them, which they feel is their right to demand from people with less than they have. But it isn’t their right and they aren’t going to get it. Insisting that anyone who does say anything negative about them is envious, making them the enemy, wrong, should feel guilty, etc., are the regular propaganda myths that get trotted out because nobody likes it pointed out that they are being insensitive assholes to others. The objection is not to their money. The objection is to their behavior towards others who have less than them and their lack of sympathy for those people. And even those who are in the 1% who are not asking for sympathy and who have sympathy for people who have less, if they insist that the people who have less cannot say anything negative about them or the system that gives them tax and financial advantages for earning $200,000 a year, they are again being insensitive assholes. It’s not their money, it’s what they say to people who have less power than them and how they treat them. Saying you should shut up and leave me alone and feel sympathy for me because I have troubles too and am not a millionaire is insensitive. It just plain is. And that’s what Scalzi is objecting to, as a member of the 1% who is not insensitive. #2) If we’re all guilty, then no, you don’t get to be left alone just because you have some money but not as much money as others. You are in the society with people who are struggling and that means that when they scream in pain, you don’t tell them they’re being mean to you and have no legitimate reason to scream just because you aren’t as rich as you would like to be. If you do, be prepared to be called an insensitive asshole.

    Many members of the 1% did buy Bush the election, from ads, campaign funds, paid agents who confused seniors, media that spread lies, to buying politicians who legislate redistricting to the judicial malfeasance of the Supreme Court. As much as half perhaps of the 1% are conservative and don’t share your friends’ views. As you point out, the power brokers like to set people with less against each other, with one side complaining and calling for change and aid for those in trouble and the other saying that those struggling have no right to complain or ask for change or aid. Those making $200,000 a year get tax and financial advantages for being at that level. So they don’t get to opt out of the complaining and calling for change by those who are deliberately blocked from the ability to get to the $200,000 a year income level. That doesn’t mean that the multimillionaires are being ignored. But someone with $200,000 a year has more power and resources to effect change — and to organize others to effect change — than someone making $30,000 a year and trying to keep his family alive. And saying that you don’t have as much power as a multimillionaire doesn’t change that fact.

    Here is an example of people who have very little and yet still understand that they are lucky:
    http://thesocietypages.org/socimages/2012/02/21/the-rhetoric-of-luck-among-the-99-percent/ You want to tell those people that they should be sympathetic to people earning $200,000 a year and who think that they should get even more special tax breaks than the special tax breaks they already do just because they live in San Francisco, I’m saying, don’t be surprised if they give you the finger.

  378. It’s interesting how “we are all to blame” and yet you’ve done nothing but defend and justify your one-percenters, and make sure any blame aimed at them always goes somewhere else.

    Maybe you ought to consider that you’re not as egalitarian as your “we are all to blame” types of statements might try to portray you. Just consider it as a possibility that maybe you’re a tiny bit more biased than you’re trying to portray yourself here.

    Note there is no barrier to entry for anyone getting one of these jobs

    Bwhaah??? No barriers at all? The child of a single mom working three jobs, goes to public school in a lousy neighborhood, has to deal with all sorts of family problems, and so on, has absolutely no more barriers to getting one of these jobs as the child of a 5 million dollar a year parental unit, who goes to private school, tutored, and can afford any college they want?

    I mean FUCKING A, Dude. In your rush to defend your poor picked on, unjustly victimized rich friends, you just pulled a complete and total “let them eat cake” piece of nonsense right out of your ass.

    Let me clue you in to some reality here for a second. You friends in the 1%? I’m sure they work hard. I’m sure they put their nose to the grindstone for years. But having grown up on a farm, I know for a fact that hard work isn’t a guarantee for getting ahead. It isn’t what separates your 1% friends from all the folks I know who’ve had their family farms foreclosed on them. There’s an important bit that actually has a huge effect on whether someone ends up at the top 1% or whether they end up below the poverty line: totally random dumb luck.

    You know what happens when a person starts to realize that at least a good part of why they succeeded as much as they did was because the universe happened to roll some lucky dice for them? They start to appreciate just how lucky they are and they stop bitching about being so fucking lucky.

    Rich people complaining about keeping up with the jones? They’re bitching about being so damn lucky that they can play that game.

    You know what else happens when someone so lucky as to end up in the 1% starts to realize they they got their in part due to a good chunk of luck? They stop saying asinine statements like “there are no barriers to entry”. Of course there are barriers to entry. They just got fucking lucky and got through them. Sure hard work and studying and all that helps too. But jesus, man, part of having some fucking compassion for your fellow human beings comes from realizing where you got lucky in life and they didn’t.

  379. @George William Herbert says: “Median household income in the City and County (same thing) of San Francisco is $55,000, according to the statistics I find.”

    Uh, no. The median wage is $70k (higher than the $58k average for California), but the average house price is $751k, versus $384k statewide.

    This is why I grit my teeth when I see people like Scalzi saying things like “When in public, please shut the fuck up about how difficult your life is, economically.”

    Our tax code is set up to *screw* people in high income, high expense situations.

  380. Kat: Here is an example of people who have very little and yet still understand that they are lucky:

    cross posted with you. Just clicked through the link and gave it a read.

    I think the 99% use the word “luck” to describe their situation because they get that some luck was involved in getting where they are, and also some bad luck got in their way in other areas.

    The thing about the 1%, especially the ones screaming that they’re paying too much in taxes, that they they are the job creators, that they are the John Galt’s of the world, that they are the economic engines that drive this country… the thing about those types is they don’t think they were lucky. Or if they do acknowledge it, they simultaneously dismiss it as irrelevent or insignificant.

    I think what it is, is a problem of worldview and whether it gets challenged or not.

    The two different worldviews at play are (1) “the world is a level playing field” and (2) “the world is not a level playing field”. If you think the world is a level playing field, and then you work hard and make a bajillion dollars, then nothing you did and none of your outcomes will challenge that worldview. But if you start out thinking the world is a level playing field, and then you work your ass off for years adn get nowhere, you start to realize that worldview is full of shit. You start to realize that luck has a lot to say in how your life turns out. At which point you acknowledge it. You acknowledge that luck had something to do with the things you have, the job you have, the spouse you have, the family you have, and so on.

    The linked article seems to suggest that acknowledging luck was dismissing your opinion as invalid. But I don’t see it that way. I think the natural world is inherently unfair, not a level playing field, and that people naturally get where they get through hard work, study, perseverance, plus a large chunk of good luck and bad luck. And part of teh role of society is to make the playing field more level. Give everyone a little luck.

  381. @Greg actually I have a personal friend who fits exactly your single mom description. She attended a remote program, got a certificate in statistical data mining and currently works for ning.com. She’s not single though.

    I myself was born lower class and went to state college on financial aid and loans.

    However, you are correct, socio-econometric bias still apply. We do our best out here to level the playing field but it is not possible to level it anywhere near completely. The only thing that can take a bite out of that problem is good government programs.

    Working in an industry like this is not something anyone can do either, I know that, like you said it has only something to do with working hard and a lot to do with being born with a certain innate ability coupled with the drive to make it happen and the circumstances to take advantage of opportunity. That innate ability + drive + circumstances is what you are calling “luck”. it’s actually not “luck” though, I would call it “a health and well functioning society”.

    If we had ten or twelve sectors of the economy like silicon valley, but all servicing different innate skill sets and located in different parts of the country, coupled with the appropriate government programs to try to ease the socio-economic dysfunctions (provide the circumstances), then we would be in business I think. No one knows how to make that