Re: Byproduct of Bush?

David Friedman <ddfr@xxxxxxxxxxxxxxxxxxxxxxxxx> wrote:
On the other hand, I think Mark's "superclass" considerably
exaggerates what's actually happened. One can make thinks look
very uneven if one looks only at financial wealth. They get more
even if you include housing, which is a very large part of the US
capital stock.

Even after the so-called collapse of the housing market, I think most
Americans, even those who still have jobs, cannot afford a house. If
a large percentage do own a house, most of them bought it long ago
when housing was affordable, or inherited it, or bought it recently
using money from the sale of another house. I think most Americans
who don't already own a house never will.

As for those who do own one, its high dollar value is illusory wealth,
since they can't sell it unless they simultaneously buy another that
costs about the same, or unless they resign themselves to spending the
rest of their lives paying ever-increasing rents, since they have to
live *somewhere*. All that owning an expensive house means is that
they have to pay a lot in property taxes.

They get even more even if you look at income, or better consumption,
rather than wealth.

I'm not sure what you mean. How can consumption look better than
income unless the person is either depleting their savings or getting
deeper and deeper in debt? If you mean that relatively few Americans
are literally homeless or starving, that's true, but I think that is
likely to soon change.

I wouldn't be surprised if it's true that the income distribution
has become less flat in the past few decades--certainly many people
make that claim, although I have seen arguments that at least part
of it is a statistical artifact.

I wouldn't mind a bit if there were more billionaires. My concern is
with the median. And I *am* concerned. I think we may be facing the
extinction of the middle class.
--
Keith F. Lynch - http://keithlynch.net/
Please see http://keithlynch.net/email.html before emailing me.
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