What does it take to be rich–and who qualifies?

I grew up in a time when a millionaire was about as a rich as a person could be. And there weren’t many millionaires. Today, millionaires are hardly wealthy. Here’s a then/now chart from an article on millionaires in Wikipedia:

Depending on how it is calculated, a million US dollars in 1900 is equivalent to 2006 US dollars of [13]

  • $24,766,584.77 using the Consumer price index,
  • $21,224,697.05 using the GDP deflator,
  • $114,128,571.43 using the unskilled wage,
  • $162,813,054.25 using the nominal GDP per capita,
  • $641,531,874.47 using the relative share of GDP,

Thus one would need to have a little over twenty million dollars today to have the purchasing power of a US millionaire in 1900, or more than a hundred million dollars to have the same impact on the US economy.

Okay, but how many of “us” are really rich today? Here’s a look at the current division of wealth in our country from Mashable.com

But wait. How does this apply to rural communities? Well, I did a quick check of the US Census data from 2010 for St. Lawrence County and found that of the almost 42,000 households in the county, the mean annual income is about $54,000 and the median is about $43,400. Another way of looking at this data: more than half of these households (about 27,000) earn under $50,000–and about 12,000 of these households earn less than $25,000.

So, what does this mean: for our society, for our economy and political lives? This growing imbalance in the division of our national wealth…does it matter?

 

14 Responses to “What does it take to be rich–and who qualifies?”

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  1. Laura says:

    Yes, it matters greatly. The reason there seems to be less and less money available is because more and more of it is in the hands of so very few, and they are not spending it on the common good. Meanwhile, we have all been co-opted into prioritizing money above ethics, as this essay describes:

    http://www.carnegiecouncil.org/publications/articles_papers_reports/0139

    We urgently need to remember that money is a means, not an end. We need to revamp our economic system so that it better serves our (ethical) ends.

  2. Ken Hall says:

    Ellen, This is a very nice video presentation of a graphic presentation of same which I came across several years ago and linked to friends and relatives with amazingly small effect. It appears that the average American either cannot comprehend what is displayed in the graphs or they have swallowed the “conservative” line of BS that any American can slide on over to the 1% side of the curve if only they utilize their “god” given capabilities to work hard and with great diligence.

    Of course it matters. The fact that the relative wealth of the family you “choose” to be born into has nearly 100% control over your ultimate fate is becoming more and more detrimental to the well being of the citizens of the USA. The laws guaranteeing social and economic safety nets put in place after the “great” depression are being torn asunder by GOP/conservative determination to drive the left side of the curve to “effective” zero so as to maximize the right side even more absurdly. This potential for social and economic collapse of 80% or more of the citizens of the US based upon the absurd insistence that an economic system designed to function only with exponential growth of consumption, pollution, ., .,. and population can be sustained “forever” is lunacy. Blind eyes are turned by the vast majority of Americans to the plight of the Earth and her flora and fauna with the insistence that the only significant matters are homo sapiens their wealth and their toys.

    What we have herein is an excellent example of what Brian Mann referred to as an inability to comprehend problems “which requires a larger, longer frame of reference”.

  3. tootightmike says:

    It matters, but our opportunity to do anything about it is vanishing daily. The scales are so uneven that even if everyone you know agreed, the one percenter would buy your vote, your representative, or both.
    That said, it is time to leave the playing field. Let them have the ball if they won’t share. Stop buying their lies, their fuel, their food. Stop working for them, stop fighting their wars, stop earning them money.
    And given the opportunity, trip them on the stairs…

  4. Ellen Rocco says:

    TootightM: I’m interested in your notion of “leaving the playing field.” This echoes what happened in Poland before the demise of the Soviet Union. Basically, dissidents backed away from participating in much of mainstream political and economic life and created a “parallel universe” if you will. This alternative infrastructure included education, food, social life. Likewise, Hamas served a similar role in parts of the Middle East. How would you imagine people stepping away from our mainstream economic, educational and political systems?

  5. VBurnett says:

    Sadly, most Americans can’t step away from the system. We’re locked in through mortgages, credit card debt and – oh yes – those student loans that we thought would result in jobs that compensate well enough for us to pay them off. Some of us can take steps to reduce our participation in and dependence on the system and the earlier we start in life, the better off we’ll be.

    I imagine that folks who wish to participate in an alternative economy should try to avoid consumer and college debt, choose homes with low mortgages and high energy efficiency ratings, grow some of their own food, develop talents and skills that can be bartered with neighbors, plan for ways to share resources (housing, transportation, land for food production) with extended family or a formalized co-operative group and try to use off-grid power sources as much as possible.

    It would also be a good idea to get rid of most popular media in an off-grid home. Media culture is all about driving our dissatisfaction levels up so that we strive for greater participation in the consumer economy.

  6. knuckleheadedliberal says:

    I have a couple of ways to start walking away from the playing field.
    1) Stop watching TV. Lots of people are working very hard to use your television to change the way your mind operates. It is nearly impossible to think for yourself if you watch any significant amount of TV.

    2) In as much as is possible, get your money out of Wall Street. If you are in a IRA and nearing retirement it may be hard to do, but if you are young use your money (and time) in ways that save you money, increase your value/skills as a worker, provide income, provide valuable tangible assets. Examples; when you buy a piece of furniture spurn IKEA and buy quality furniture that will last your lifetime- preferably hand-made by someone you know; buy or build a very small, very efficient home which will save you on heating/cooling, furnishing, and cleaning; find a hobby with potential to make money – like jewelry, woodworking, or even just chopping wood – and invest money in quality tools for that hobby; learn to cook from scratch, eat at home often but when you do choose to eat out go to a restaurant that is locally owned and not a chain.

  7. tootightmike says:

    The “gray market” as they call, it is quite strong in many countries, sometimes rivalling the official economy. Of course our government doesn’t sanction such activity, but really, where do all those folks who longer qualify for unemployment go? Firewood cutting and house-cleaning are pretty lousy jobs, but if you’re working for cash, you’re already in the gray market. Deciding to go that route while you have some resources on hand gives you a better chance to create your new career All those folks we know who lost half the value if their IRAs and such would have done better to have cashed out and put solar panels on the roof instead. All those guys driving a $30,000 pickup might have been wiser to buy a useful toy like a tractor, or built themselves a workshop or studio and stay home.
    I would never suggest that everyone should quit their job and move to the woods; Many of us have already tried that with mixed success. I would suggest forgoing the next big toy purchase and whittling down your debt though. I would suggest finding your passion or developing your hobby. I would suggest developing relationships with the talented or handy folks around you, and helping them to get really good at whatever they’re up to; You may need them some time. The “other team” is about to take the ball, the bat, and the field, and go home.

  8. tootightmike says:

    To answer more directly Ellen’s questions: Checking the numbers, I think we see that most Americans have already stepped away from politics: it makes me wonder what they do with their political thoughts. At the same time, we see more big money entering the campaigns, and those who do vote are compromised by a tide of misinformation.
    Hardly a week goes by lately without a news story about how worthless a college education has become. I opted to go to a trade school instead of college 40 years ago, and instantly became the only one of my peers to have money in my pocket. Some of my friends, who went the college route did fine, but ended up working for places with security clearances…and ulcers. Others got a stack of degrees, but didn’t recover their economic footing for 30 years. They would have done better repairing bicycles.
    Economically, You may not have to leave the system. If you lost your IRA; the system left you. If you worked for an airline that went bankrupt, and they re-negotiated your pension; the system left you. If the manufacturer you worked for packed up and moved to Mexico; the system left you.
    Raise your kids to be clever and capable. They’ll be helpful someday.

  9. Ellen Rocco says:

    When I think and talk about our economy and political system, I can pretty quickly twist my knickers into knots. I was a “back-to-the-land” big city transplant to the north country back in 1971. With that long view perspective, two things stand out for me: one, I was incredibly idealistic and fairly unrealistic; but on the other hand, many of the ideas and concerns we had then are more true today. Think about things like organic and local food (you were considered totally whacko in 1971 if you used the word “organic”); or environmental issues raised way back then (remember, Earth Day began in 1970); or the notion of thinking globally and acting locally, of reclaiming political ground for every day citizens, and on and on. The trick is going from good idea to implemented practice.

  10. Rebekah says:

    I am very grateful that this information has been brought to light but watching it gave me many mixed emotions. I would qualify as that group that doesn’t even register on the scale. My family tries to scrape by on less than $900.00 a month. I thought it was funny the person that wrote above about walking off the playing field. Necessity has forced my family to do this and all of this has left me wondering again about that old question “how much is money and happiness tied together”?

    We can’t afford a TV – my kids must read books, go outside and play in the woods, and make-up games for fun. We eat simply with a focus on basic nutrition – lots of beans, rice and a few veggies. Here is a favorite, simple meal. Dump a can of tuna in a pan, add some rice mix it together, add some broccoli chopped up small add an egg or two mix it together until the egg is cooked. Turn off the heat and dribble with sesame oil. Try It .. its cheap, delicious and nutritious. Oh and of course the bartering with neighbors. With one of my neighbors I tutor her son in regents preparation in exchange for fresh eggs from her hens, with another neighbor I give them some of the homemade creams I make in return for used toys and other kids hand-me downs.

    I guess the point of writing my story is that you might read this and think in horror of poverty but on the contrary I think poverty has its good points. It allows my children to escape [by-in-large] unhealthful nutritional choices [all those processed goods cost too much]. I took a free online course on nutrition and realized our limited means have made it so we must eat a heart healthy diet. Bartering with my neighbors and all of us sharing in the struggles of survival together has brought us closer as a community. Not being able to buy many material goods for my kids have kept their lives simple and down to earth. Our life is very simple allowing the spot light to shine more brightly on what is really important to us.

    So I wonder if this skewed representation is going to lead to another kind of economy in the long run…? I don’t think we can go back to that ideal or even back to what we “think it’s like”. I just don’t see how anyone could get the very rich to give up their money – if they have so much already and don’t seem to mind that they own most of the wealth how can they be convinced otherwise in the future?

    I don’t think going back is an option. That being said even as what will happen to the rest of us remains an unknown, I do hope it has nothing to do with happiness because I feel it is possible to experience true happiness in the state of scraping by.

  11. knuckleheadedliberal says:

    In Hippy vs Madison Ave, Madison Ave wins every time. But there is a generation coming along that has watched less TV than the previous one – that is the hope.

  12. tootightmike says:

    Another angle for Ellen… What you choose to do with your money makes a difference. You can purchase your fuel oil from the one percent guy at the top, or you can heat your house with wood and buy it from the neighbor who’s off the other end of the chart. You can shop at WalMart, or you can buy from someone who lives in your community. You can buy a new car every other year, or you can hire Joe the mechanic to keep you running for a decade or more. You can buy a package of chicken from Tyson, or you can get a much better chicken from one of your neighbors (unless you live in Potsdam).
    When you have a “good job”, one that pulls in the big bucks, your responsibility to play Robin Hood is even more essential to the community around us. Take from the rich (it doesn’t have to be by force), and give to the poor (and it doesn’t have to be charity).
    Clearly the money has been flowing up the chart for too long, and it’s time to work to reverse that flow.

  13. Ellen Rocco says:

    Rebekah, Tootight, and all: Everything you’ve said makes sense to me. In fact, what stands out is how much agreement there is about the notions of bolstering local economies and learning to live as simply as possibly. Nothing radical, and yet incredibly radical in the big picture of America post-WWII.

  14. tootightmike says:

    Interesting that you should mention WWII. One of the things I’ve tried to model my lifestyle on was the way returning soldiers set up their lives in the late forties. Those who had been to Europe, came home with an vision of self sufficiency that was different than the life lived by the pioneers. They build auto repair garages, chicken houses, dairy barns, and machine shops. They planted apple trees and gardens in every backyard, and they went to school with an eye toward serving in some industry. They had seen something in Europe that did not yet exist in America, and that was a fully matured society and economy. Europe had run out of easily exploited resources 500 years ago, but continued to build their societies, their economies, and their rural culture. In the late forties they also witnessed what it took to piece a world back together after a disaster, and to plan carefully when the slate was wiped clean.
    I do not seek so much to live simply, as to live meaningfully. We eat like kings at my house, and we work hard for it. We have the ability to repair and improve our home, and to invest in the future, and there is enough to share though we live on a single income. We invest in the community with our spare time and energy, and invest in the neighborhood with our gardens, our strong hands, and our smiles.