Wealth Inequality in America

[jhungary]

@jhungary : Germany(Western part) - this has 60 million people and the system like Sweden and Australia works there.

Anyway the idea that a mixed system won't work in US due to the number of people is incorrect.

The total US GDP is so much more than smaller countries like Sweden and so it is affordable.

Fact is that most Americans like the current system and so there is no need to change it - it is a CHOICE that Americans have made and it is nothing to do with economic efficiency. The UK is one of the closest countries in Europe to the US system and it is nowhere near as well off as Western Germany.

Actually......

First of all, you cannot use GDP as a country as a whole to measure the Inequality of Wealth. The very notion of GDP is not used to measure the wealth distribution (Either PPP per capita or nominal) It does not say how much each citizen earn. And it does not say how deep is the gap.

If you have to say this

The total US GDP is so much more than smaller countries like Sweden and so it is affordable.

Then this must be true as well

The total China GDP is so much more than smaller countries like Sweden and so it is affordable.

The truth is, China have a Gini of .48 while US have a Gini of .45

Secondly, Germany is really an exception on this case simply because it took in more than 15 million former East Germany citizen 21 years ago. If those former East German are to adopt the total capitalism from zero to hero like that you may as well killed all of them, there are no way they can live in a world like that with virtually no procession to start with. So it is not possible for Germany (either east or west) to run on a pure capitalism model, like the one in the US. Anyway, 60 millions german are not great number to begin with. It's 1/5 of the total population in the US

Thirdly, the more people a country have, the more people be in poverty line. It's very much totally differnet if you have a 20 millions and you have 300 millions. The mean poverty rate in the west is 15%, which mean there are only about 3 millions of Australian are under poverty line but there are a whopping 45 millions American under the poverty.

Do you know the money it need to feed 3 million poor australian and do you know how much money you need to pipe down to those 45 millions american. It's 15 times more you need in America than in Australia. Yes,The rich is richer in the US, that does not mean they contribute more to those unfortunate than any other middle working class.

[delete for inaccuracy detail]

If the population is higher, the more people will be in need and the tax threshold will need to further increase. Then who would want to earn money in Australia if you know for sure for every dollar you made, only 53 cents or less are entering your pocket.....

If you look at the wealth distribution in Asutralia, the standard deviation of Riches and Poor are different, the poor have a greater S.D at about 9-12% at a increment of $100 per weeks. Until the median ($515 per week) while the riches have a 2%-4.5% of S.D. at a increment of $100.

6523.0 - Household Income and Income Distribution, Australia, 2009-10

That explained that, in order pull the gap closer, the larger amount of tax are needed for the riches to suppliment the lower income people. However, if you multiple it by 15 time and reflecting the American economy. You will see there are basically more poor than the riches can reaches (SD is smaller in richer side so there are more middle income than higher income as the gap progress smaller, ie lower Standard Deviation) however, the poor remain the same as there are bigger gap between each subgroup (ie bigger SD)

What you assume is, the richer the people, the more tax they pay and the tax they pay is correspondent to the money they made. Then you are dead wrong. In reality, the richer you got, you pay less tax in proportion to your wealth, the simple differnet of a better accountant have already save you money that you would have pay if you do taxes yourselve.

You cannot simply pay off poor people if there are enough to go around, yes, for the wealth the richest of the richest have, there should be no poor people around, but do remember, people are selfish, are you willing to give $100 to your next door neighbor without any question or reason but just because he is $100 short of making an end-need?

How about $1000, or $10,000 or $100,000

You cannot look at which system better off for a country by just looking at one side of the story, you need to look at both side. But at least we agree on one same thing. People choose to be poor, it's no political pressure nor social pressure to force people becoming poor. You weaped what you sowed that's what..

 

[gambit]

Why do you have to paint the whole picture in black and white like many others here with a US flag in their profile? successful European countries have shown that we can have a relatively equitable society without killing the incentive to work hard and move forward.

Because of slippery people like you who are long on criticisms but short on details.

Even in the days when Germany was much more a social economy we still had our billionairs and millionairs and at the same time the gap between rich and poor was much smaller than now. And where did I say that being wealthy is bad? where did I say that people who have more than they need should be punished? Stop putting word in my mouth!

It's all about equality and a just society where everyone should have a decent life and not end on the street despite working three jobs. Poverty is a hindrance to democracy, an enemy of freedom and human rights.

How to eliminate poverty? How about paying a worker enough for a 9 hour/ day, six days a week job so that he and his family of four can have three square meals, some clothes and a roof above their head that is warm and safe even if he is a garbage man or washing dishes in a restaurant and not working at three jobs and still unable to pay all the basic bills? Some billionairs and millionairs might earn 20 or 30 % less, but still enough to lead a life in luxury. It did work fine here in Germany until the Berlin Wall went down.

And who are YOU to say what is 'enough'? Why restrict your criticisms to the bils and mils? Why not impose that argument on people like YOU? What kind of car do you have? Can we know the model so we can start criticizing it as to when it becomes too 'luxurious' for YOU?

My house is 3000 sq/ft on .24 acre. Just me and my G/F. No dogs or cats. Only houseplants. That is far too much house and possibly too luxurious for two people and I have no problems saying that. If you are willing to criticize bils and mils for their wealth, have the courage to say at which dollar/deutsche mark/drachmas/yen/lire/whatever amount is immoral and start chopping away from there. Carlos Slim is reportedly the wealthiest man on Earth -- 70-something billions. Chopping %50 of his wealth still would not come close to his basic needs one bit, ya think? So how about %99 then? Come to think of it, may be we should chop %90 of YOUR wealth.

 

[UKBengali]

Then this must be true as well

The total China GDP is so much more than smaller countries like Sweden and so it is affordable.

No. This does not apply as the Chinese GDP/capita is so much lower than US or Sweden.

The US has ample funds to have a functioning welfare system like Sweden but it CHOOSES not to.

Developing countries like China do not have this luxury yet.

 

[Developereo]

Let me tell you this, in order for Australia to feed those 3 millions Australian in poverty, the tax system is 3 tier for Australian.

Tier 1 is for low income person, basically you don't pay a cents on tax if yuou earn less than 6000 a year
Tier 2 is for normal income person, basically from 6000-56000 income a year, every dollar you made, 26 cents goes to the government.
Tier 3 is for Rich/Higher Income person, basically you got the 6,000-56,000 threshold, then every dollar you made after 56,000, you pay 47cents to the government, that's 47% of tax.

Here's the tax rate schedule for individuals in Australia
Individual income tax rates

Taxable income	Tax on this income
0 - $18,200	Nil
$18,201 - $37,000	19c for each $1 over $18,200
$37,001 - $80,000	$3,572 plus 32.5c for each $1 over $37,000
$80,001 - $180,000	$17,547 plus 37c for each $1 over $80,000
$180,001 and over	$54,547 plus 45c for each $1 over $180,000

For comparison, US federal tax rates are (add 0-11% for state tax)

Tax rates, by themselves, don't tell the whole story because different countries have different loopholes.

 

[jhungary]

No. This does not apply as the Chinese GDP/capita is so much lower than US or Sweden.

The US has ample funds to have a functioning welfare system like Sweden but it CHOOSES not to.
Developing countries like China do not have this luxury yet.

you said the Total.......

The total US GDP is so much more than smaller countries like Sweden and so it is affordable

Total GDP in China in 2012 : 12 trillion dollars
Total GDP in Sweden in 2012 : 381 Billions.....

Otherwise can you explain to me what is the meaning of "total"??

Here's the tax rate schedule for individuals in Australia
Individual income tax rates

Taxable income	Tax on this income
0 - $18,200	Nil
$18,201 - $37,000	19c for each $1 over $18,200
$37,001 - $80,000	$3,572 plus 32.5c for each $1 over $37,000
$80,001 - $180,000	$17,547 plus 37c for each $1 over $80,000
$180,001 and over	$54,547 plus 45c for each $1 over $180,000

For comparison, US federal tax rates are (add 0-11% for state tax)

My bad, that's the figure what my friend told me, obiviously he was lying

My bad

 

[Developereo]

My bad, that's the figure what my friend told me, obiviously he was lying

That's cool. I wasn't trying to put you on the spot but to point out that tax rates in the US and the "welfare state" countries are not all that different.

Depending on which US State you live in, you may actually end up paying more tax than in Australia.

 

[jhungary]

That's cool. I wasn't trying to put you on the spot but to point out that tax rates in the US and the "welfare state" countries are not all that different.

Depending on which US State you live in, you may actually end up paying more tax than in Australia.

Actually i am....

I pay around 17000 in taxes in United States, and i pay $0 in Asutralia

Better yet, i have borrowed 20Gs from Gillard government thru FEE-HELP to suppliment my degree and meanwhile i am getting Ausstudy

Yeah, i am that cheap.........

 

[Soumitra]

Sure, the homeless people on the streets are just jealous of the millionairs and they deserve to live on the street since they are just too stupid to make their first million although they had three low paying jobs before the ended up homeless because those three jobs still couldn't make ends meet for their necessary bills. Those lazy bumps should indeed have taken a fourth job and quit sleeping, resting, wasting their time with watching TV and eating junk food and they wouldn't have ended up on the street.

They could have worked hard and maybe developed an app like that 17 year old who was paid millions by yahoo, or stated the next google in a garage, or next Facebook in the hostel room

 

[Sedqal]

America is not going to break-up because of wealth inequality guys, too much wishful thinking going around

 

[Ethiopian Dude]

They could have worked hard and maybe developed an app like that 17 year old who was paid millions by yahoo, or stated the next google in a garage, or next Facebook in the hostel room

dude 5% of americans own about 90% of the wealth the vast majority of americans have no real wealth, live pay check to pay check or on credit cards...dont believe everything u see on tv... things arent always what they seem.

 

[UKBengali]

They could have worked hard and maybe developed an app like that 17 year old who was paid millions by yahoo, or stated the next google in a garage, or next Facebook in the hostel room

There is something called "intelligence" and very few people have the level required to do things like this.

 

[MST]

dude 5% of americans own about 90% of the wealth the vast majority of americans have no real wealth, live pay check to pay check or on credit cards...dont believe everything u see on tv... things arent always what they seem.

For God sake you are living in a capitalist country. What else do you expect. If you want to see equal wealth distribution then may be you should have gone to Cuba instead of coming to US.

 

[gambit]

People that are smart and/or have the correct connections won't have much of a problem with this. Others would.

Countries like Sweden and Germany(western part) that have much less wealth inequality than the US are just as rich, so the argument that this form of capitalism is required to maximise wealth does not hold true.

Here is where you are wrong...

Say that the aggregate of mine and my neighbor's wealth is $1,000,000. Does that tell you which one of us is wealthier than the other? No. Two + Two = Four. So does 3 +1. So does 1 + 3. So does 0 + 4.

The point is that you cannot take the total estimated wealth/GDP of a country, compare it against another, and make a moral judgment about wealth inequality between the two. If your goal is about FORCED wealth distribution, in other words, make everyone inside a country equal in terms of individual wealth level, then make that moral judgment. But as long as you allow the people to exercise the freedom to play capitalist, then inside one country, you will have 2 + 2 = 4, another country will have 1 + 3 = 4, another country will have 0 + 4 = 4, and so on.

So is my wealth $500,000 and my neighbor's is $500,000 for a combine of $1,000,000 ? Hardly. My neighbor's wealth is $800,000 and mine is $200,000 and we got along just fine. Even if his wealth is $950,000 and mine is $50,000 that does not give anyone the credible justification to criticize our wealth disparity because he got his wealth through honest means, and so did I. We just have different talents and different amount of luck, if you want to inject luck into the discussion.

You are nothing more but one of the many peddlers of petty jealousy infesting this world.

For God sake you are living in a capitalist country. What else do you expect. If you want to see equal wealth distribution then may be you should have gone to Cuba instead of coming to US.

He is too much of a coward to actually live in the communist paradise he admired while living the in evil capitalist US.

 

[ViXuyen]

Democrapcy is the formula for wealth inequality and economic sucess, right? No wonder we have so many third-worlder democrapcy in South East Asia, Africa, Latin America, South Asia LOL

 

[gambit]

Democrapcy is the formula for wealth inequality and economic sucess, right? No wonder we have so many third-worlder democrapcy in South East Asia, Africa, Latin America, South Asia LOL

You think I do not see the wealth inequality in Viet Nam? How is that communist 'paradise' you are living in?