Richard Fernandez:
The Associated Press describes a new problem in Obama’s America. Wealth is once again threatening to rear its ugly head. You may not realize it, but there’s a danger that as many as one in five Americans may get rich sometime in their lifetimes.
WASHINGTON (AP) – Fully 20 percent of U.S. adults become rich for parts of their lives, wielding extensive influence over America’s economy and politics, according to new survey data.
These “new rich,” made up largely of older professionals, working married couples and more educated singles, are becoming politically influential, and economists say their capacity to spend is key to the U.S. economic recovery. But their rise is also a sign of the nation’s continuing economic polarization.
They extend well beyond the wealthiest 1 percent, a traditional group of super-rich millionaires and billionaires with long-held family assets. The new rich have household income of $250,000 or more at some point during their working lives, putting them – if sometimes temporarily – in the top 2 percent of earners.
The new survey data on the affluent are being published in an upcoming book, and an analysis by The AP-NORC Center for Public Affairs Research provided additional information on the views of the group.
In a country where poverty is at a record high, today’s new rich are notable for their sense of economic fragility. They rely on income from their work to maintain their social position and pay for things such as private tutoring for their children. That makes them much more fiscally conservative than other Americans, polling suggests, and less likely to support public programs, such as food stamps or early public education, to help the disadvantaged.
Last week, President Barack Obama asserted that growing inequality is “the defining challenge of our time,” signaling that it will be a major theme for Democrats in next year’s elections.
The story relates how “after growing up on food stamps, [a man named] Lott now splurges occasionally on nicer restaurants, Hugo Boss shoes and extended vacations to New Orleans, Atlanta and parts of Latin America.” Clearly this does not bode well for income equality if your goal is income equality.
Quite apart from being distasteful, it is also destabilizing. Nobody — at least nobody of quality — likes a parvenu. By definition income equality refers to the distribution of income. The only ways to achieve it are to reduce income variance or apply some redistributional mechanism to level things off.
What is more some of those newly wealthy will also lose their fortunes some time in their lives. The process of the poor striking it rich and the rich going bust creates a turmoil in the income structure that is inimical to social stability. How can you plan for the future when you don’t know what it is?
During the 2008 presidential campaign Barack Obama had a conversational encounter with Samuel Joseph Wurzelbacher, who became known as “Joe the Plumber” that captured the dilemma. When Joe the Plumberdeclared his desire to earn $250,000 a year Obama replied:
Funny how it is only those unpredictably conservative who are problematic-when-wealthy.
Obama’s belief that at some point you have earned enough money never seems to apply to predictably liberal wealthy people.
Bill Clinton comes to mind.
Obama’s ex-cabinet and czars, too.
Obama says at some point you’ve made enough money and then proceeds to tax those who haven’t instead of those who have.
With the recent attention to wealth concentration, I think it important to focus on some important things:
Check the disgusting dominance and degree of obesity in public assisted housing and clients in public assistance facilities in the USA. The “poor” are overfed and make bad choices. Bad choices includes what they did with public education paid for by those that apply themselves beginning at a young age.
Even before the recent increase in socialism in the USA, non-performers had been given special breaks.
Performers have voluntarily supported non-performers in many ways.
How can third world countries develop wealth in a culture where their ruler refuses to acknowledge the AIDS problem in their country.
How can a country develop wealth if their out-of-country supporters promote hate, provide weapons but do not build commercial factories and productive schools and incentivise enterprise.