April 3, 2014
Why Don’t The 1 Percent Feel Rich?

It’s hard out there for the 1 percent.
Okay, that’s not true at all. But they think it is. If you talk to people on Wall Street, most of them—even, in my experience, the ones shopping for Lamborghinis—will tell you that they’re “middle class.” Their lament, the lament of the HENRY (short for “high-earner, not rich yet”), goes something like this. You try living on $350,000 a year when you have to pay taxes, the mortgage on the house in a tony zip code, the nanny who knows how to cook ethnic cuisine, the private school tuition from pre-K on, the appropriately exclusive vacation, and max out your retirement and college savings accounts. There just isn’t that much cash left over each month once you’ve spent it all!
Well, sure. But burning through your money to live the lifestyle of the rich and unfamous doesn’t mean you’re not rich. Nor does it mean that the top 1 percent haven’t been pulling away from everyone else. They have. You can see that in the chart below from Berkeley economist Emmanuel Saez’s numbers on income inequality. It looks at how much different parts of the 1 percent have made as a share of total income. Now, the top 0.01 percent—that is, the 1 percent of the 1 percent—have increased the most, almost quintupling their income share in the last 40 years. But the “bottom of the 1 percent” (the 99 to 99.5 percent) have increased too. So both the super-rich and the merely rich are growing faster than everyone else.
Read more. [Image: Reuters]

Why Don’t The 1 Percent Feel Rich?

It’s hard out there for the 1 percent.

Okay, that’s not true at all. But they think it is. If you talk to people on Wall Street, most of them—even, in my experience, the ones shopping for Lamborghinis—will tell you that they’re “middle class.” Their lament, the lament of the HENRY (short for “high-earner, not rich yet”), goes something like this. You try living on $350,000 a year when you have to pay taxes, the mortgage on the house in a tony zip code, the nanny who knows how to cook ethnic cuisine, the private school tuition from pre-K on, the appropriately exclusive vacation, and max out your retirement and college savings accounts. There just isn’t that much cash left over each month once you’ve spent it all!

Well, sure. But burning through your money to live the lifestyle of the rich and unfamous doesn’t mean you’re not rich. Nor does it mean that the top 1 percent haven’t been pulling away from everyone else. They have. You can see that in the chart below from Berkeley economist Emmanuel Saez’s numbers on income inequality. It looks at how much different parts of the 1 percent have made as a share of total income. Now, the top 0.01 percent—that is, the 1 percent of the 1 percent—have increased the most, almost quintupling their income share in the last 40 years. But the “bottom of the 1 percent” (the 99 to 99.5 percent) have increased too. So both the super-rich and the merely rich are growing faster than everyone else.

Read more. [Image: Reuters]

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    This is actually a rather interesting article. Of course it doesn’t excuse such behaviors or attitudes, but it does...
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