Sunday, June 11, 2017

Top 20%

Richard V. Reeves, who apparently graduated from Oxford, has an idiotic op-ed in the NYT on class in America, entitled "Stop Pretending You're Not Rich". In it he argues that the top 20% of Americans, with an average family income of $200,000/yr, are a sort of permanent American upper class.

Rather than lying with statistics, he is probably just being stupid, but it's a familiar trick. The top 20% includes all the billionaires, centi-millionaires in the top 1% and top 0.01% and they make that äverage statistic pretty meaningless. In fact, only 7% of American individuals, and 17% 0f households, make more than $100,000 per year. The entry level to that top 20% is a lot less than $200K. The roughly 5.6% of households actually making more than $200K/yr are certainly fairly well off, but it's the top 0.1%, with a minimum net worth of around $20 million, and who own more wealth than the bottom 90% combined, who really count as rich, and even they are pikers compared to the guys who can write $20 million dollar plus checks to finance a favored political candidate or cause.

Wealth is more important than income for deciding who is actually rich, and the top 1%, with a minimum net worth of about $8 million, count as rich to me. The minimum net worth to make it into the top 20% is around $400K.