No, the U.S. is not "a poor society with some very rich people"
We're a rich society with some very poor people.
John Burn-Murdoch of the Financial Times is one of my favorite economics journalists. But when he describes the U.S. as “a poor society with some very rich people”, he’s just not right:
This inaccurate description of the U.S. — which comes from the headline of the article itself, and is repeated in the final sentence — is highly appealing to a lot of people. Many Americans resent the (very real) concentration of wealth at the top of the distribution, and many are (quite rightfully) still upset about decades of slow income growth. And some outside the U.S. resent the smug chauvinism with which some Americans trumpet that their country is the greatest in the world. So it’s little surprise that the tweet above went viral.
And Murdoch is certainly right when he notes that America is a more unequal society than most other rich countries, and that we should focus more on redistributing income to the people at the bottom. I strongly agree with the following:
To be clear, the US data show that both broad-based growth and the equal distribution of its proceeds matter…Five years of healthy pre-pandemic growth in US living standards across the distribution lifted all boats…But redistributing the gains more evenly would have a far more transformative impact…The growth spurt boosted incomes of the bottom decile of US households by roughly an extra 10 per cent. But transpose Norway’s inequality gradient on to the US, and the poorest decile of Americans would be a further 40 per cent better off while the top decile would remain richer than the top of almost every other country on the planet.
But by focusing only on the rich and the poor, Murdoch leaves out something incredibly important — the middle class. Of course it’s important to uplift the people at the bottom of the socioeconomic ladder. But most people are not at the bottom of the ladder. That’s true by definition. And when we look at how Americans in the middle of the distribution are doing, we see that America is not a “poor society” at all — in fact, it’s one of the richest on Earth.
America’s middle class has higher living standards than almost any other country’s middle class
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