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Life and Times of an itinerant slacker in Sacramento. Thrills, Spills Galore coming soon. Not to mention lots of opinions.

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Monday, September 08, 2008

Winners and Losers – Follow the Money

Since the start of my years as big money world of consulting actuaries in the 1990s, I heard a constant stream of complaining by people in households earning well over $100,000 per year. The complaints were about people feeling poor. One actuary once confessed that “It’s too hard to raise two kids on $150,000 annual income”. It seemed so strange. What is going on here?

How do people decide if they are happy with the money they have? I recall that in the 1990’s someone at the University of Illinois did a study that that showed people in the upper middle class actually less happy with their financial status than people in the lower middle class. I am too lazy to find a citation, so trust me or don’t believe, I don’t care.

However, this interesting factoid comes from This source . This ain’t a primary source,but I am not digging further today.

Percentage of Americans who say they have achieved the American Dream:
Those earning less than $15,000 a year: 5%
Those earning more than $50,000 a year: 6%
I have heard similar observations elsewhere. In short, a lot of folks with more money don’t feel richer than folks scraping to get by. Could this be an expression of some kind of mass hysteria? I doubt it.

This picture tells the thousand word story:

Perhaps we Americans are a little into social climbing, ambitious for increasing our social status. If that’s the case, than we’d be rational to evaluate our well-being by looking at the next highest rooster in the picking order. The corporate drone in the cube asks how is he doing compared to the guy in the side office. The side office guy measures himself against the guy in the corner office, who grovels at the feet of the guys upstairs.
If that is the case, you can see how the gap between the upper reaches of the middle classes and the richest 20% has exploded in our lifetime. The most recent data I could find only runs up to 2001,when the federal Government got serious about supercharging more tax breaks for the rich. The gap has only gotten bigger.

Therefore, you must pity your poor boss, whose must suffer the indignity of working for a boss so rich he treats everybody like servants (trust me I’ve been there). I am tsk tsking as I write this.
That’s my story and I’m sticking to it.

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I must enjoy shouting into a vacuum, but I think about getting my act together one of these days. My mom says I am very handsome and intelligent.

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