broadsword
Brigadier
Did you miss the expansive coverage of the authenticity of the American inflation data a few pages back? Quite a few members dived into it and it ran for a few pages. You should have responded to them.
American Economics Thread
- Thread starter Bernard
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Did you miss the expansive coverage of the authenticity of the American inflation data a few pages back? Quite a few members dived into it and it ran for a few pages. You should have responded to them.
There was actually massive inflation during 2018-2020 that no one noticed is a ridiculous statement since everyone can observe prices
FriedRiceNSpice
Captain
How many jobs paying > $90k are there in Phoenix, Dallas, San Diego? Go on Zillow, find some homes in the suburbs, and look in the "estimated monthly payment," calculator. The US has the most wealth in the world, the problem lies in the distribution. Very few Americans are living in mass affluence. For someone living in the US, actual purchasing power, housing costs, and cost of living are far more important than GDP and official CPI numbers. The middle class is shrinking, and the quality of life for middle class Americans have not improved for the past 2 decades. And the number of jobs in the upper middle income range (which would need to be at least $120-150k, not $90k for the 3 urban areas you mentioned) which would enable actual wealth accumulation are becoming harder and harder to find.
But the median individual income in 2022 in the USA is only $40K, which is less than half the $90K figure you are quoting.
And in order to earn more than $90K per year, you have to be in the top 17% of earners.
That is only 1 in 6 people in the US.
Yeah, I mean, part of mass affluence means people need to work fewer hours and for fewer years. Part-time college students and early retirees have “income” but their low income is because of mass affluence as well as teenagers who are of working age who make $0.00 (biasing median income downwards) but who don’t work because of mass influence not in spite of it. The labor supply curve bends outwards. And 37 million out of 161 million people who paid taxes in the U.S. in 2021 reported an income of more than 100K (so ~23% or 1 in 4). 52 million people reported an income of 75K or more (or 1 in 3). What’s more, tax filings will understate income, since private business ownership, which is extremely common in the U.S., will often use creative accounting to push personal expenses as business expenses and thus massively understate business income (since for sole proprietorships and limited partnerships - business profits and personal income are the same concept; many people will push their housing and utility costs as business “expenses” so that their personal income appears to be lower than it is). And for employed individuals - the cash value of employer sponsored health insurance and 401(k) matches aren’t taxable income so the IRS doesn’t calculate. So at a MINIMUM, 23% of workers make more than 100K. It easily is likely over 30% once the in-kind value of nontaxable employee benefits and creative small business accounting is taken into account. -
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Mass affluence means that Bob, the finance major fratbro who attends Southern Illinois University will by middle-age, be making $150K a year working for a mid-sized bank or insurance company, immunizing a balance sheet, “working” 35 hours a week from home (living in a McMansion in DuPage County) with 2 cars, a beautiful wife that doesn’t work and not a single worry in the world outside of planning their semi-annual vacation to Hawaii and watching their retirement savings stack to the sky and overflow with cash.
"The Coming Collapse of the USA" - SDF Bestseller
If we are talking about the masses, that wife is going to be tipping the scales getting way too close to 2 bills... but if that's what you like, more power to you.
FriedRiceNSpice
Captain
Dude what kind of fantasy world do you live? Also please learn the difference between household income and individual income before talking about income statistics. @AndrewS provide the correct data for % of Americans making > 100k, the sources I have crosschecked all verify his numbers. Being in suburb of Chicago within commuting distance of Chicago, Bob must either 1) be living paycheck to paycheck if he is the sole earner in his household making $150k or 2) be in the top 0.1% making 500k but working 80-100hrs per week.
EDIT: or 3 Bob's parents bought his house and 2 cars.
Also hoping Bob doesn't have kids yet.
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I feel your examples are getting ridiculous now.
A salary of $150K is now in the top 7% of earners in the USA.
That is only 1 in 14 people in the US.
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But let's go with it.
That works out as $9666 per month after tax
But on the expense side:
$4000 for your McMansion
$500 for property tax
$500 for utility bills (it is a McMansion)
$1000 for 2 nice cars
$2000 for other spending like food, restaurants, entertainment, shopping, clothes etc
That's $8000 already, which leaves less than $2000 for savings, luxury goods and to fund holidays.
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Plus you forgot about the children. Call it $2000 per month for 2 children and then there's college as well.
Whoops. There go the savings, luxury goods and holidays.
Bob is now living paycheck to paycheck
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FriedRiceNSpice
Captain
Does the after tax income include state tax? Illionis has a state income tax as well, if that's not included there goes another $600 per month. How much 401k contribution are you assuming? And only $500 a month for property tax, is it really that low in the Chicago metro area?? In New York metro area, the property taxes are about $2-3k per month. And if it's a MacMansion, there are additional expenses like repairs, maintenance, landscaping, etc that can easily add up to $10k per year since cost of labor is so ridiculous in American cities.