Two per cent hold half of world’s assets.

The middle class is an incredibly recent development. Throughout the ages, there have always been a few rich, and many poor.

In order to understand poverty, one must study why people remain poor, in defiance of ample opportunity to be educated and/or better themselves.

I believe a large difference is how one views and takes advantage of opportunities. A person inclined toward gaining wealth sees opportunity everywhere, even in failure. Those who seem destined to poverty look at the same situations and see it as oppression.

Someone inclined to wealth see ample credit as a way to add real value to their lives, another opportunity. One inclined toward poverty sees credit as something to be used with no thought of the day of reckoning, since somehow they will be oppressed further and not be able to pay their bills.

I spent plenty of time with people whose financial life was in total disarray. Some came by their poorness honestly, for whatever reason. But more got into the mess they were in by not looking past their noses. Not to pat myself on the back, but I'm naturally someone who can figure out the best thing to do with a given amount of money in a given situation. I used to get discouraged when I would actually be asked for advice, but there would be some half assed excuse why that wouldn't work for them. I personally know someone who did not buy their insulin so they could give a relative stranger (someone who had money BTW), a useless gift of a stuff toy in a basket. She ended up in the hospital over it, and the recipient was appalled that she got a worthless toy meant for a child, over necessary medication. This sort of stuff happens much more than some would realize. I don't believe it's a matter of education per se, I think there is some sort of mechanism in many people where they could no sooner change their spending habits than the color of their eyes. So now, I don't bag my head against the wall anymore. If someone wants to change, they will follow a good example.

Citing facts about distributing wealth over the worlds population is useless and makes no sense. If everyone in the world was issued $20K, no more, no less, and had any existing debt cleared out, so what?

That money would immediately start changing hands again, and it would not at all be difficult to predict where it would end up.

I like theories, they spark conversations. Anyone else have theories to bring up?

His employees? How about those individuals who've gained their wealth via wise and often risking investments?

We really don't have a middle class any longer in the USA. We have the super rich, the rich, the working poor and the nonworking
impoverished.

Not convincing? Is that why so many immigrants want to move to the USA?

By the way, where did the Queen of England get all of her dough?
Popping corn at the local movie theater?

The Middle Class a recent invention? What do you mean by recent? Half a millenium? Shakespeare's father was part of the new middle class in England, people who were involved in commerce (glove maker and -- perhaps illegal -- trader in wool) and who were active in the tending toward representative democratic politics of the day (alderman and mayor) who were developing educated and urbane taste.

Remember, too, what the communists and the early labor union activists had in common: both were proponents of and practioners of education for the sake of individual development. Hmmm. That makes them sound like the men of John Shakespeare's generation. Anyway, both the unionites and the communists sponsored study groups. I actually attended a communist cell study group in the 1960s, just once, because Lenin's secretary, Raya Dunyevskaya, was to speak. Unfortunately, the person who brought me had the date wrong and we listened to something that foreshadowed today's book club meetings: a discussion among the group's members of some writings by Lenin. These people were more interested in humanism and the humanities than in economics and the over throw of governments.

Interesting Miller.

How would you difine in terms of dollars of income let's say, what makes up these classes?

Taking away that the super rich have enough assests to live off the income from them.

In terms of income alone, what do you consider the cut off point between "the rich" and "working poor"?

For instance, I don't consider myself rich, nor do I consider myself poor. Thinking of my neighbors and friends, I think mostly they are in that section between the too.

Me, I think saying the either you're "rich" or "working poor", no in between, is sensationalist.

hmmm...yes, I think those are some fair numbers.

overall, taking out some overpriced city like, let's say San Francisco, or an area where land is relatively cheap, like in a very rural region.

I don't mind being called working class. To me, that implies I'm working, and making a living. Is able to pay utilities, housing and food. Has a bit left over. Probably intends to work to the end, out of need. Vacations, if taken, involve local travel, no set itinerary. Maybe visiting relatives with some special attractions thrown in.

Working poor, barely holding on. Has to make a choice from month to month between phone bill and electric. Somehow makes it through.

Middle class, slightly above working class in that they can envision a day when they might stop work if they wanted to. Vacations may still me car vacations to friends and relatives, but sometimes a special trip by plane, like every 5 to 10 years.

I think having some reference as to what "working poor, working class, middle class" means is necessary to understand where each of us is coming from.

Personally, all 3 of the lifestyles above sound fine to me. I've been in each one, and always been happy. For instance, when I was at a time for about a year where I had to choose between food or a coat, I knew it would be a temporary situation, and that if I was willing to sacrifice and do without, I'd inch my way out of it, which I did.

Wait, I'll make an amendement. The only part about the barely making it month to month did have that big black cloud of no health insurance over it. I will say that was a really hard thing to deal with.

A current trend in the defining of "class" in the US of A is debt to asset ratio. Seems as though what we would usually consider as middle class has now encumbered such grave levels of debt that much of the middles have a negative bottom line and continue sinking. This is pretty much a recent development beginning with post WW II. This situation has little or no bearing on actual $ income.

Exactly! The debt issue. See my prior post on the expotential growth of the credit card industry.

It's not so much people aren't making money, it's that they can't wait to have every whim satisfied NOW, NOW, NOW!

Was South Dakota evil because it loosened its usury laws so ranchers and businesses get loans? Was Citibank evil to see an business opportunity to be able to market credit cards? Was Deleware evil to follow suit?

Where does one pinpoint the exact time where one can say someone's gone over the line.

Is the problem a bank who takes advantage of an opportunity, or the person who of his own free will takes up this vehicle to debt?

As per my above post re debt to asst ration, this becomes self-evident when you notice how McDonalds et al have now installed credit card acceptance due mainly to the fact that the middle class consumers have no cash. "one egg mcmuffin with sausage that will be $1.09, visa or mastercard?"

The issue of whether or not one is middle class is beyond economics. Parents of baby boomers in a state like Michigan which had a higher standard of living than surrounding states lived very well in the late 50s and 60s and were able to take advantage of good health care coverage and to enjoy simple vacations and to look forward to retirement.

My father, born in 1923, never earned more than $20,000 during his working years which began when he was 14 and lasted until he was 60. In fact, his standard of living was -- in some ways -- higher than my own and higher than families of a similiar "class" today.

The current federal poverty level for an individual is (I think) $9,300. In some, if not in most, states, no one can live on so small an income. Here, in Massachusetts, the individual poverty level is $18,900.

The working poor and the middle class -- which many sociologists agree is moribund -- are separated by goals and values. For example, you probably would not find books in a working poor home today, although you would expect to find them in the home of a family that considered itself middle class.

A friend of mine, actually born on the original Pearl HArbor Day, was the only child of a couple living in Denver, CO. Her father was an elevator operator and her mother a homemaker. They were able to afford piano lessons for their daughter who went on to major in music performance in college. In economic terms, this family would have been considered the working poor during the 40s and 50s. While there no longer are elevator operators, a man earning at a comparable level today would not be able to own a home as this man did and his wife would not be able to remain at home with their child. That child would not have piano lessons paid for by her father.

This short story illustrates why sociologists and some economists say the working class is dying and may already by dead.

In my opinion we have become too greedy and too gullible. We believe those smooth ads and rush out to buy on credit. It will end badly.
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As for myself, I haven't had a penny of debt for the last 30 years or so. I remember the 'mortgage burning party' we had, with a bonfire and a lot of drinking and dancing.
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If I cannot afford it, I don't buy it.

Honestly, I don't carry cash because it benefits me to charge what I would have bought anyway, leave the cash in the back, pay it off, and earn points that get me a $50 gas card every couple of month.

I'm ahead of the game by $250-$300 a year on that one card, and don't buy anything that I wouldn't have plunked the money down for anyway.

It's all in the matter of how you use it, it can be a tool, or a liability. It seems many people have amnesia about what they acquired during the month, getting a big surprise when the bill arrives. I have no sympathy for them. If you can be swayed (on a regular basis) by shiny baubles, well then, frankly you're too stupid for words.

We all hear the sad stories of people who have huge credit debt and how they are working their way out of it, mostly with simple advice like, "stop spending so much money" Whenever I hear this stuff, I think "I wish I could get hold of their credit card statements for the last 3 years." I'm going to reserve sympathy until I see if they were charging medical service because they had no insurance, or if their charges were for items they had no business buying, if they wanted to live within their income. Jesus, what a surprise, you spent more than you make.

When I was in gradual school there was a professor who put forth the proposition that the difference between middle class and upper class was that the middle class troe to put their children though college so they would have an education that would provide a safe income for their lives whereas the upperclass sent their children to university to make contacts/connections they could use after they graduated.

Today, the rich are differentiated from the working poor by the amount of their liquid assets, as opposed to income/year received from employment. Also important, is that liquid net assets are to be expressed as liquid assets/individual as opposed to liquide assets/household.

A household of 3-5 individuals with a net income of $40,000/year is considered to be poor, as they should be.

The Gini Index is interesting. The gap between the rich and the poor is a good yardstick.
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http://homepage.mac.com/phil_giltner/Gini.html

I whipped up a quick graph of that information, and I suppose it's all in how you view the information.

1st. the rating is from 1 to 100, most equitable to least equitable of 112 countries.

The "most" equitable country starts with Belarus @ 21.7, the "least" is Sierra Leone @ 62.9

Looking where the mid point, 50 is, you find Venezula and Zimbabwe. Frankly, that doesn't tell me anything, since I don't know anything about either country. What I can see immediatly is that this is no perfect bell curve, there are 92 countries below 50 and 20 countries above 50. The bell would be skewed way to the left.


I would ask a few questions.

What, for instance, is the difference for the people in Denmark (24.7) as opposed to Norway (25.8) What's the difference in quality of life?

The U.S. and Pakistan are right next to each other, @ 40.8 and 41.
So?
I would venture a guess most people would not want to change their poverty in the U.S. to the poverty in Pakistan.

In other words, taking countries individually like this doesn't really say anything about the lives of the individuals there, necessarily.

I see that Denmark and Japan are around 24, the U.S. is around 41

The population of Denmark is 5 and a half million. The size of a large U.S. city.
The population of Japan is 128 million.
The population of the U.S. is 300 million.

You can say that more people in the U.S. live in poverty than the total population of Denmark.
Or, you can note that people who are well off is many times the population of Denmark.

Depends on how you want to look at it.

I'd like to see that Gini Index for the entire world, as a whole, one number. It would be interesting to see the big picture, rather than compare a country where the population is small, and in decline, like Italy, to a country that the populaton is large and growing, like Mexico.

Ah, but now number of children comes into play.

Two Percent Hold Half of World's Assets
I think part of the problem (at least for minorities) is that we don't have anyone to teach us how to acquire wealth. Getting just a basic education or even a college degree won't teach you how to make or manage money. I can't speak for how schools are set up now, but when I was in high school there weren't any classes on how to plan for your future. It was all about just graduating and either going on to college (if you could get a scholarship) or finding a job. We also didn't have mentors to help us and we weren't encouraged to be entrepreneurs... especially women.

In spite of what we missed out on, I'm now trying to break the cycle of poverty in my family. We've started a business, Jahqoi, Inc. (we're clothing manufacturers) and we're slowly but surely working our way up the ladder. It might take a while because we're doing this without a major investor. But we'll get there. Later on, when we're successful, we plan to help other budding entrepreneurs. Each one, teach one is my philosophy.