Why this strange ratio?
The ratio says 1% supposedly owns 1/3 (33.3%) of the wealth (not 99%). It implies, however, that somehow 99% of us is getting screwed by the 1%. I’d like to question this idea. And maybe challenge the 99% movement and the rest of us to rethink.
Some trivia about the 1%
Others have done more homework than I have. Here’s what howstuffworks.com says:
First, it’s important to make some distinctions. This statistic is specifically referring to wealth, not income. Income is how much money you earn in a given year. Wealth, also known as net worth, is the cumulative value of all of your assets minus your debts. What qualifies as an asset? Cash in the bank, investments (stock, bonds, CDs, 401(k)s, IRAs, etc.) real estate, jewelry, art, collectibles and anything of tangible value. Debts would include outstanding mortgage debt, student loan debt and credit card balances.
It’s important to make a distinction between income and wealth because income inequality and wealth inequality aren’t equal. According to research originally done by economists Thomas Piketty and Emmanuel Saez, the top 1 percent of income earners took home 17.67 percent of the total income — less than a fifth — of everyone in the U.S. in 2008.
To qualify as the top 1 percent of earners, you need to make a little more than $500,000 in cash income in 2011.
Wealth inequality is far greater. According to an analysis of Federal Reserve data by the Economic Policy Institute, the wealthiest 1 percent of Americans control 35.6 percent of the total wealth of the country — more than a third.
Even more incredible is that the richest 10 percent of Americans control 75 percent of the wealth, leaving only 25 percent to the other 90 percent of Americans.
What about the 99%?
Why not the slightly more modest “90% movement“?
After all, if we whittle the elite down to 1% (Apples), and admit their mere 35.6% of the wealth (Oranges), this may not stir a mass movement. However, if we hold that the elite is 10%, then even though we reduce our troops from 99% to 90%, still, 75% of the wealth is a much bigger prize.
For my taste, both numbers, 1% and 10%, are too neat. Why not any other ratio set? 2%:98%? Or .5%:99.5%? Or just the same, 11%/89%? Or 9.666…%: 91.333…%? Any figure is a moving target. But if we are going to isolate a group of people to hate, can’t we be more precise?
Math favors precision. Propaganda doesn’t allow it.
Of course, there are those who do look for more precision. This from Wikipedia:
“We are the 99.9%” – by Nobel Prize winning economist Paul Krugman in a New York Times op-ed arguing that the original slogan sets the bar too low when considering recent changes in distribution of income. In particular, Krugman cites a 2005 Congressional Budget Office report indicating that between 1979 and 2005 the inflation-adjusted income for the middle of the income distribution rose 21%, while for the top 0.1% it rose by 400%.
“We are the 53%” – In October 2011, in response to the slogan, conservative RedState.com blogger Erick Erickson (along with Josh Trevino, communications director for the Texas Public Policy Foundation, and filmmaker Mike Wilson) launched a counter-slogan—”We are the 53%”—referring to the 53% of Americans whose income is high enough to pay federal income taxes.
Even here, economic polemicists can’t decide whether to argue on wealth (Oranges) or income (Pears). It’s clearly about wealth.
The game we’re playing
Just for sport, let’s for a minute forget about the so-called sinfully wealthy–send them to hell, at least in theory. Let’s assume there is no trickle-down effect. Whatever the 1% has (35.6%) doesn’t exist. It’s off the table. Now we’re back to 100% of the wealth.
If we do this, will we achieve peace on earth? Or do we go after the next 1%? It’s of course theoretically possible to keep shaving off the top 1% ad infinitum. We’re going to reach ad nauseam first, and if we’re smart, stop shaving before we slit our own throats. (We might stop at, say, 9%.)
Given the inherent competition in the fight against the 1%, it is common knowledge that we will by instinct keep whittling away the top percent until we reach our adjusted lowest base number–which is not at all the idyllic 99%.
If I wear a suit, it is not an indication of wealth, only that I bought a suit. How I bought the suit is another question–likely on credit to impress my boss in the vain hope of a raise to pay for the suit. If I go into the grocery store after work, the cashier might think, “Oh, he’s one of them.” And why shouldn’t he think this? There is no solidarity between us. Not in this game. Even if I am perceived as even a small fraction ahead of the curve, it is natural that the cashier question the order of things, even secretly despise me for my appearance: I am the 1%.
If you’re not with us, you’re against us
What if I refuse to play this game?
Emerson said, “There is a time in every man’s education when he arrives at the conviction that envy is ignorance.” He was preaching self-reliance. If nobody will hire me, I will employ myself. I was a cashier. I was a ditch digger. They taught me the desire for something else and gave me mobility to do it. If I cannot find food in the city, where the mob stirs in unrest, I will go to the countryside. I will begin again. What does it matter if one offers me a loan and another forgives it? I will find it in myself to be my own benefactor.
Most fortunes are made within 15 to 25 years–some much sooner. Fortunes mostly die with those who made them. Think of the titans of industry today. Are they what they were a generation ago? How did they supplant the old regime? Just as birth supplants death.
If self-reliance is now supplanted by a mere either/or choice between reliance on the elite or reliance on the mob, if the collective, either way, is to supplant the individual, then I am no longer free.
There is no totality of wealth
To accept that there is one big pie that contains 100% of the wealth, we have to consign our minds to medieval superstition. While it is reasonably arguable that there is a scarcity of natural resources–i.e. “land”–it is clear that the measure of wealth is only limited to our imagination and desire and commitment to work. Wealth, in case we forgot, is not a pie, once eaten, gone. There is no 100% of human ingenuity. The essence of creativity is infinity, not totality. The products of individual creativity are infinite.
To see a world in a grain of sand,
And a heaven in a wild flower,
Hold infinity in the palm of your hand,
And eternity in an hour.
William Blake – Auguries of Innocence
Death on the trading floor
While in San Francisco on a business trip, I talked with a bus driver on the way to see the back-then Golden Gate Bridge. He caught my attention because he was listening to and repeating Chinese phrases on the bus’ old tape deck. We got to talking, and he told me that he used to be a stock exchanger on Wall Street. He had lost everything, he said. After that, his wife left him and took the kids and whatever was left. So he moved here.
“You have to expect that when you get into it,” he said. It was a stoic statement, I thought, but this man seemed to have found peace with himself.
He said he had mastered the basics already of a handful of languages just for fun. When he wasn’t doing that, he was learning something else. He was taking night courses after driving the bus all day, paying for them outright. He was about forty years old.
Whenever I see photos or videos of men and women on the Wall Street trading floor, I am baffled. They are working much harder than almost anybody I can think of, but they work in illusion. I can’t help thinking about Elia Kazan’s Splendor in the Grass. The father of Warren Beatty’s character jumps to his death from a hotel window upon hearing he lost his Wall Street fortune in The Crash. While Beatty’s character had ambitions, at the end of the movie he’s a poor farmer–not with the love of his life, Ms. Wood, but still able to feed himself and his family. Not too bad.
When I see the successes of the Occupy movement–and they are successes–buying cheap debt and forgiving the debtor, holding banks responsible for their promises to customers, etc.–I still have the same sinking feeling: What are they up against but illusions? If we know that any day the bottom could drop on stocks and banks, etc, then we can reasonably expect the same might happen for the opposition. After all, they’re both standing on the same trading floor. “Stop fighting fire with fire,” I want to say. “Get out before the house burns on top of all of you.”
A saner way of life
Congress and the president are today in a stalemate, because, as honorable men and women, they want to protect their constituents–be they the 1% or the 99%, or as they say, “struggling small business entrepreneurs” or the “hard-working middle class.” The propaganda machine is in full tilt. So that neither side will lose, they have made it so neither side can win. Nobody gets a tax cut. Our elected officials can be manipulative, greedy little bastards. Or maybe they’ve swallowed their own swill. Personally, I don’t think it’s a question of either/or. As Mark Twain wrote in 1891, “Suppose you were an idiot. And suppose you were a member of Congress. But I repeat myself.”
However, if we decide that the dissenters and revolutionaries become our representatives, then the same might as well be said for them.
Sadly, we are not at the stage we can tell our representatives to be moral, decent, and kind. We carry the fortunate burden of making our own dreams our futures–not one all-encompassing, collective dream, but the dreams you alone have–the dreams I alone have–each night and day.
Illusory universality is the universality of the art of the culture industry, it is the universality of the homogeneous same, an art which no longer even promises happiness but only provides easy amusement as relief from labour.
― J.M. Bernstein, The Culture Industry
By means of industry and perseverance you will rise higher and higher.
― Robert Schumann