Johann Wagener 9-11-13
Hey folks! Uncle Sam is throwing a party and you're all invited!
We all know that it doesn't take much for you to find a reason to celebrate or commemorate something.
This party is to celebrate the "American Dream" and, for desert, you all get a piece of that American pie you were promised. To keep it simple Uncle Sam has invited 10 people who will represent you and everyone in the USA. Just as promised, everyone will get a piece of the pie so it's cut into 10 pieces.
So, here's how it goes;
After everyone takes a seat at the table, the person at the front of the table starts off by taking 5 pieces for the 10% of the people he represents.
The top ten percent of earners in the United States took home more than 50 percent of all income in 2012, the highest amount ever recorded since data was first collected in 1917, according to an updated report from economists Emmanuel Saez and Thomas Piketty.
Whoa! Now there's only 5 pieces of pie left to share among the other 9 folks left at the table. Well, that's not so bad. If you cut those 5 pieces in half then there's still enough for the 9 other guests. And, after all, the way our system works, the person at the front should get more because they are more talented and work much harder than the rest of us. If it wasn't for them we would not have a pie to eat (or so they say).
People often wonder exactly how much income and/or wealth someone needs to have to be included in the Top 1% or the Top 20%; Table 1 below lists some absolute dollar amounts associated with various income and wealth classes, but the important point to keep in mind is that for the most part, it's the relative positions of wealth holders and income earners that we are trying to comprehend in this document.
| Table 1: Income, net worth, and financial worth in the U.S. by percentile, |
| Wealth or income class | Mean household income | Mean household net worth | Mean household financial (non-home) wealth |
|---|---|---|---|
| Top 1 percent | $1,318,200 | $16,439,400 | $15,171,600 |
| Top 20 percent | $226,200 | $2,061,600 | $1,719,800 |
| 60th-80th percentile | $72,000 | $216,900 | $100,700 |
| 40th-60th percentile | $41,700 | $61,000 | $12,200 |
| Bottom 40 percent | $17,300 | -$10,600 | -$14,800 |
But, this is where it begins to get complicated. Why? The second person at the table (another 10% of the population) claims they deserve more than the other 8 people at the table because they represent the "professional " class which obviously contributes more than the others because they are the ones who make things work, and without them there would be no pie to share. But, they'll be fair and just take 4 pieces so there's some left for the rest of us. All we need to do is split 1 piece of pie 8 ways!
In the United States, wealth is highly concentrated in a relatively few hands. As of 2010, the top 1% of households (the upper class) owned 35.4% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 53.5%, which means that just 20% of the people owned a remarkable 89%, leaving only 11% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth minus the value of one's home), the top 1% of households had an even greater share: 42.1%. Table 2 and Figure 1 present further details, drawn from the careful work of economist Edward N. Wolff at New York University (2012).
| Table 2: Distribution of net worth and financial wealth in the |
| Total Net Worth | |||
|---|---|---|---|
| Top 1 percent | Next 19 percent | Bottom 80 percent | |
| 1983 | 33.8% | 47.5% | 18.7% |
| 1989 | 37.4% | 46.2% | 16.5% |
| 1992 | 37.2% | 46.6% | 16.2% |
| 1995 | 38.5% | 45.4% | 16.1% |
| 1998 | 38.1% | 45.3% | 16.6% |
| 2001 | 33.4% | 51.0% | 15.6% |
| 2004 | 34.3% | 50.3% | 15.3% |
| 2007 | 34.6% | 50.5% | 15.0% |
| 2010 | 35.4% | 53.5% | 11.1% |
| Financial (Non-Home) Wealth | |||
| Top 1 percent | Next 19 percent | Bottom 80 percent | |
| 1983 | 42.9% | 48.4% | 8.7% |
| 1989 | 46.9% | 46.5% | 6.6% |
| 1992 | 45.6% | 46.7% | 7.7% |
| 1995 | 47.2% | 45.9% | 7.0% |
| 1998 | 47.3% | 43.6% | 9.1% |
| 2001 | 39.7% | 51.5% | 8.7% |
| 2004 | 42.2% | 50.3% | 7.5% |
| 2007 | 42.7% | 50.3% | 7.0% |
| 2010 | 42.1% | 53.5% | 4.7% |
When all is said and done 2 people went home from that party with 9 pieces of the pie while the remaining 8 of them scurried back with whatever they could shave off the remaining piece grateful to be living in a Democracy (is it really?) where everyone has an opportunity to get a piece of the pie. Well, at least 20% of us. As the other 80% were leaving they heard someone say;"these losers should be grateful that got anything at all. They have nothing to whine about. They can go back to their mortgaged to the hilt homes, kick back, open a can of beer, order a pizza, watch a football game and go to sleep knowing that the "Anerican Dream" is still just that; a dream.
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