"He earned it..."

[_Gadianton]

That's a quote from Ajax on another thread. I think what he means is summed up by this random response to a random inequality post from The Economist.

"The rich are rich because they've done something with their lives instead of sitting back and crying about it..."

I'm not advocating any "solution" to the "problem" of income distribution. I just want to make one point and see if people agree or disagree with it: The rich quite obviously have not earned it, at least not in the sense of "earning it" that most defenders of the rich mean. It's not even hypothetically possible under equality of opportunity assumptions.

Don't read to much into what I'm saying, I'm not advocating redistribution or anything else as I think dealing with difficult problems can be counterintuitive.

My argument is simple, and I'm sure the point has been made many times, but I haven't seen it brought up here. Human attributes for success, like all attributes of biological entities are normally distributed. Even if intelligence, motivation, and ambition aren't easily quantified by tests, we have no reason to believe any attributes or combination of attributes defy a normal distribution. Yet, income and wealth are nowhere near normally distributed.

Marathon runners in the top .01% might be several times faster than the average person, but not 50 times faster, and not several times faster than a runner barely making the top .05%. Likewise, it is not true that a person's hard work and skill are sufficient conditions for explaining riches.

The "he earned it..." argument must be stated to explicitly allow for a zero-sum element, which it never is. So this thinking would go: to assure the best and most competitive environment, we should allow disproportionate rewards for small differences in acheivement at the top. In the wild, the biggest bull Moose mates with disproportionately more females than the second biggest bull Moose. A lot of leverage is packed onto that small, defining edge. But, in the wild, no bull moose is too big to fail, and the disproportional benefits of the biggest bulls are still nowhere near as disproportionate as US income distribution. The closest analogy in nature to the super-rich might be to an invasive species, which is typically not regarded as ecologically beneficial, and of course, owe excessive returns entirely to luck. In other words, not even in the most dyed-in-the wool Korihor society of "prospering according to genius," can the super rich be explained, and the rich require the qualification of leverage.

Anyone who supports world peace would seem to support the olympics, and the fastest runner "earns" far more prestige than the fifth fastest runner, even if the physiological differences and amount of hard work are slim between the two. Perhaps we psychologically feel the same about rich people, but at minimun we should acknowledge the leverage involved: Hard work/skill + leverage = rich, not hard work. And the super rich are impossible to fatham without introducing major gobs of luck. And mind you, I'm considering the "ideal" world of brute competition here, in the real world, of course, most people are rich because they were born into it. So what I'm saying is, if we imagine the US economy to be one big competitive game -- which it isn't -- the rich can't be explained without leverage, and the super rich can't be explained without luck. The "He earned it.." defense makes it sound like rich people can be explained by proportionally greater skills and efforts than poor people under equality of opportunity assumptions, and this is obviously false.

[_ajax18]

What I mean is that each indvidual is responsible for his own life which includes the good and the bad that comes with it. No man has the right to steal from another man, just because he's found someone who has more.

If you are earning $33k/year now, you're already in the top 1% of the worlds income. I don't think most of us will like the results of global socialism, not even Kevin Graham.

[_just me]

Wonderful post Gad.

This is something that has bothered me for a long time. A mother with 3 small children typically works very long hours for no pay, no retirement, nothing.

A lettuce picker works in very harsh conditions for very little wage.

A CEO may spend most of his time sitting in lavish board rooms and offices, wine/dining people, playing golf and jet setting around the world. CEO has benefits galore, tons of disposable income to save/spend/invest and a bunch of retirement investments. CEO also has a huge wage sometimes in spite of the company doing poorly. Oh, and the company can often qualify for corporate welfare programs.

No one can convince me that the CEO works a billion times harder than the other two examples.

Oh, and the lettuce picker gets paid hardly anything so the CEO can buy his salad for cheap. The mother is raising the next generation of employees at her own expense.

But that's another conversation....

[_beastie]

The other thing to keep in mind is that many of the upper-class benefit from connections. A recent study showed that if the child of a middle-class person doesn't get a college degree, chances are high that he/she will drop into poverty. It doesn't make any difference if the child of a wealthy person doesn't get a college degree. They stay wealthy.

That's one of the things that irked me about Mitt Romney. He believes he was a self-made man, and was seemingly blind to the benefits that his family provided. Wealth and connections.

No man is an island.

[_Joan]

You're proposing a fairer distribution of wealth?
I'm all for it.
Even if you don't mention America's feared word >socialism< in the same sentence, the desire for acquisition often set up massive hurdles that get in the way.
I know capitalism doesn't have to breed greedy rich who affect the economy, but it often does.
The rich are getting richer and the poor are getting poorer.
{The saddest thing for me is when people on minimum wage can't afford teeth to chew their food.}


Denmark's got it goin' on. They seem to have a balance and aren't as driven with mindless money acquisition like the capitalists and aren't as riddled with quite the same social inequalities. I did a very basic study about the political and social aspects of Denmark and I hold it as a standard - greedy capitalists wouldn't go for it.
I once saw Oprah do a special on women of different countries. The Danish women explained that wages are fairly equal across the job spectrum.
Oprah's jaw dropped.
I thought she was going to have a stroke....what about her bazillion $$ lifestyle?

[_EAllusion]

The higher in income bracket and promotions I go, the less hard I have to work. That's actually the main appeal to me of being promoted - not being paid more - but having an easier job to occupy my time. This isn't always the case with career ladders, but it's not exactly uncommon either. I'm under absolutely no delusions that I work harder than a migrant farmer or even a frontline position in my own company.

Me being promoted has little to nothing to do with how hard I work. If anything, I'm a lazy person by nature. I just happen to be smart. I succeed because I'm a sharp enough thinker that it makes up for other faults I may have. That really isn't because of dedication, study, or personal moxy on my part. I was just born that way. I come from extreme poverty, foster care, and related social disadvantages. So while it may superficially look to others that I've dragged myself out of challenging circumstances, really I just got lucky. I'm sensitive to the fact that my biography represents an anecdote that plays into a fantasy of meritocratic social mobility, but I feel more like a lottery winner.

More broadly, it's very clear that innate talent and effort plays a relatively small role in socioeconomic status and class mobility in the United States. It's Ok to acknowledge this while opposing various redistribution schemes. To the point being discussed, I find it extremely distasteful when wealthy people believe they are that way because they simply outworked their less fortunate counterparts. That's almost never true. As Beastie notes, if you are born into wealth, it is actually very difficult to fall into poverty because of the social connections and resources you inherit with that.

[_Gadianton]

You're proposing a fairer distribution of wealth?

No. I'm proposing no solution, as I tried to make clear.

I'm pointing out what I believe to be a rational, mathematical fact. Biological features or personal attributes, however you want to slice them, can't possibly explain the distribution of wealth in the US. I'm all for assuming there are no social networks, inheritence, and other privilages, for the sake of argument, and I'm asking how wealth distribution can possibly be accounted for by skill.

I am not proposing redistribution nor am I opposed to it necessarily. I consider myself a libertarian, at heart. I really hate people telling me what to do, and I really hate telling others what to do.

[_Gadianton]

Ajax,

Earlier you said, "Even if I get sick or can't work, it doesn't give me the right to steal what the man next to me has. He earned it. Whether he helps me or not is his perrogative. That is the only difference."

The only point I'm disputing in this sentence today is "He earned it..."

Universally speaking, this is a false statement.

[_Analytics]

I totally agree Gadianton. Your thread brings to mind two books. The first is How Starbucks Saved My Life: A Son of Privilege Learns to Live Like Everyone Else by Michael Gates Gill. The second, of course, is Das Kapital by Karl Marx.

With a few exceptions, people work really hard. In the end, we are each paid what we negotiate--not the marginal value we contribute.

[_ajax18]

I find it extremely distasteful when wealthy people believe they are that way because they simply outworked their less fortunate counterparts.

Don't look at me then. I'm of average intelligence at most. I did work extremly hard to make it through graduate school and to get the letters I have after my name, but not everyone had to work as hard as I did. I even failed once, became suicidal, only to realize my only option was more debt or back to the chicken factory.

What I mean by, "He earned it..," is that those were the rules I was faced with. They've always been the rules, and now because life is working out a little better for me people want to talk about changing the rules. If the socialists have their way, I'll have my optometrists salary cut to that of a teacher, but don't think for one second they'll consider paying any of the debt I acquired to do this job, not to mention what it cost my health to put my body through whatever it took to pass the tests.

You guys talk like I'm the CEO. If I get sick and don't work, I don't get paid. I live paycheck to paycheck. If I didn't earn what I have (I'm still in the red) than nobody ever earned anything.

Universally speaking, this is a false statement.

It's false that people are equally intelligent. People aren't equally healthy. People get unequal amounts of help from their parents and family. Indeed some of the worst jobs I had, paid the least. But all that inequality does not mean the statement, "He earned it," is false. The concept of "earning" still exists in an unfair world.