2007 September 27 Thursday
American Public See Growing Divide Between Haves And Have Nots
A growing portion of the American population see themselves as members of the "Have Nots" group.
Over the past two decades, a growing share of the public has come to the view that American society is divided into two groups, the "haves" and the "have-nots." Today, Americans are split evenly on the two-class question with as many saying the country is divided along economic lines as say this is not the case (48% each). In sharp contrast, in 1988, 71% rejected this notion, while just 26% saw a divided nation.
Of equal importance, the number of Americans who see themselves among the "have-nots" of society has doubled over the past two decades, from 17% in 1988 to 34% today. In 1988, far more Americans said that, if they had to choose, they probably were among the "haves" (59%) than the "have-nots" (17%). Today, this gap is far narrower (45% "haves" vs. 34% "have-nots").
Growth in belief in the divide has grown more among Democrats (from 32% to 63%) than Republicans (from 19% to 33%) or Independents (from 26% to 46%). Also, people with less than a college education see a bigger divide than those with a college education. Also, upper income people see less of a divide than middle and lower income people. So those on top are less unhappy and see less in the way of problems. No surprise there.
The absolute most curious result from this poll is the decline in the portion of the population that considers itself as part of the "Haves" and the growth in the portion that considers itself "Have Nots". Here's the weird part: Even the upper income category (the top third of the population in income) saw a shift in that portion that considers itself "Haves" from 82% in 1988 to 66% in 2007. Rising inequality makes more people feel like losers. Economists who think that greater amounts of production are the key to happiness have no solution to offer for the human desire for higher relative status.
Will the rising feeling of being part of the "Have Nots" group translate into greater support for taxes on those with higher incomes? Also, will it translate into greater opposition to free trade and less trust in basic institutions of society?
Has anyone aside from me noticed the growth in availability of signals for demonstrating much higher income and status? For example, there was a time in American society when Cadillacs were the highest status cars (excepting rare Rolls Royces) but not any more. The distance from a Chevrolet price and a Cadillac price was substantial but not enormous. But we have witnessed a proliferation of pricier cars for even higher income people. The $100,000+ cars of today telegraph a level of discretionary income that basically sends a message to most other drivers that they really are members of the "Have Not" group. In our daily lives it seems to me that we are reminded of much greater wealth disparities than we would have been reminded of a few decades ago.
Randall Parker: You were one of the champions of the Bell Curve book. If it is true that the average IQ of a group determines its ability to accumulate wealth, then it should be obvious that this stratification phenomenon would only accelerate as technology becomes more advanced. In the year 2000, the top 10 % owned 90 % of the wealth in the US. I would speculate that by 2020, 5 % will own more than 95 %, with similar percentages in other countries.
But if high taxes and inflation are combined, then this would reduce the net worth of the upper class, as it was the case between 1973 and 1980: In 1973 the top 1 % richest families in the US owned approximately 30 % of the wealth, but by 1980, the top 1 % owned only 20 % of the wealth in the US. I assume that this was because the high inflation and taxes together made it more difficult for the rich to accumulate wealth. But by 2000, the top 1 % owned nearly 45 % of the wealth in the US, probably because the upper class benefited by economic expansion with low inflation. I do not have the more recent figures, but I assume that right now it is even worse...
"The $100,000+ cars of today telegraph a level of discretionary income"
Yet much of that income is debt,from the tech bubble of the 90's to the real estate bubble today.
And many are already finding that they're in way over their heads,with debt levels they can never repay.
Not only will there be a lot McMansions going cheap,there will be a lot those $100k cars going cheap at repo auctions.
This of course will sharpen the divide between the percieved haves/have nots as those with upper middle class incomes ride out the recession and those with basically middle class incomes who tried live as if they also had upper middles class income lose homes and assets.
Not to mention the resentment aimed at those with middle class incomes who lived fiscally conservativly and didn't bury themselves in debt.
Now add in the recently and soon to be unemplyed "cheap labor".Overwhelming concentrated in industries(construction to day spa's and resturants)that are based on discretionary income that is drying up as debt service eats more and more disposable income and 4th and 5th mortages dry up.
m: "This of course will sharpen the divide between the percieved haves/have nots as those with upper middle class incomes ride out the recession and those with basically middle class incomes who tried live as if they also had upper middles class income lose homes and assets.Not to mention the resentment aimed at those with middle class incomes who lived fiscally conservativly and didn't bury themselves in debt."
Unfortunately, if there is a severe recession or depression, this time even the majority members who were actually living well within their means, will suffer a lot more than the upper class or the upper middle class. The resentment will be directed especially at the upper class and the system in general.
Recall that after the Great Depression started, the taxes were raised for the rich a lot more than for the poor.
Please look at the following web site for a historical survey of the top marginal tax rate between 1913-2003.
As you can see, even during the golden age of the United States during the 1950s, even after the United States WON World War II, the top marginal tax rate was over 90 % for any income over $400,000, which was quite confiscatory, even if you adjust that high income for inflation. That tax rate, effectively made it very difficult for the inflation-adjusted net worth of upper class to surpass the middle class. This kind of tax rate in the United States, was a direct consequence of the Great Depression, and these high tax brackets were probably even higher than many European countries.
And here are some pictures of the Great Depression:
Here's the weird part: Even the upper income category (the top third of the population in income) saw a shift in that portion that considers itself "Haves" from 82% in 1988 to 66% in 2007. Rising inequality makes more people feel like losers.
More accurately, rising inability to afford children makes more people feel like losers.
Look -- its really basic economics:
The iron law of wages states that in an international labor market wages will fall to the cost of labor's subsistence. The problem is that the definition of "subsistence" has changed due to the advent of birth control and feminism. "Subsistence" used to, by implication, include reproduction -- so you labor costs simply could not decrease below what it cost to obtain a fertile female and keep her happy with her circumstances. With feminism and birth control, the demand for fertile women has gone up -- not as reproducers, but as employees. This at the same time land prices, hence home prices, have gone through the roof. This guts a fundamental factor of human happiness for all but those rich enough, or sexist enough (say, Islamics, orthodox Jews, Mexicans, Hindus and some evangelicals) to be able to afford to keep a woman at home and raise the children.
The iron law of wages is now destroying the population.
Oh, and don't give me this "demographic transition" garbage. The population of the US has not decreased, nor that of any of the other countries supposedly undergoing the "demographic transition". The "demographic transition" is nothing but the replacement of some population by others -- red in tooth and claw.
"With feminism and birth control, the demand for fertile women has gone up -- not as reproducers, but as employees."
Feminism didn't create demand for women employees. It was the demand by Big Central Banks (Rockefeller, Morgans, etc..) for a larger tax base, lower wages, and the further destruction of the family as an powerful institution that they created feminism and the image of "women as workers" public relations campaign. It was the demand for women as "respected employees" (wage slaves) that created feminism not the other way around. Feminism is a creation of corporations to lower wages and make so that the kidies learn how eat correctly from Ronald McDonald instead of their mothers. Corporations are at war with the family and religious institutions and they have been since Edward Berneys the God of Spin and the Unholy Father of Lies (aka advertising) and his hordes of madmen minions.
Know this, in the future armies of men will live and die for the their corporations not their countries or families because nation-states and families won't exist. The future is stockpiles of designer trademarked test tube babies and and corporate guild wars over water, oil and top soil fought by drugged-addled on neoneuropharmaceuticals merchants of death from Blackwater. It will be loads of fun and Dick Cheney will be happy.
You think it won't happen? That is exactly why it will happen because no one has the courage to think the unthinkable and act to prevent the horrors the certainly lurk in the darker minds of humanity. Optimism is the delusion that causes good men to do nothing while evil thrives.