WEALTH INEQUALITY
If Today’s U.S. Net Worth Were Distributed Fairly, Here’s How Much Money You’d Have
What a one-time distribution of wealth could do
Wealth inequality has been around since people first began living in groups large enough to allow some to specialize in different kinds of work and others to take advantage of their work. Today, the distribution of wealth in the United States is more unequal than at any time since the Gilded Age in the late 1800s.
I’m worried about this. Some rich bastard is driving around town in a Lamborghini Veneno Roadster, renovating last year’s home renovation, and purchasing luxuries the rest of us can only dream about. Meanwhile, some of my neighbors are having nightmares about getting enough to eat.
What would a fair distribution of wealth look like?
My worrying takes the form of writing about it. So, I thought I’d do some research and a bit of math to find out what a fair wealth distribution in this country would give me, you, all of us.
Most people believe that “fair” is not the same as “equal” and would not, for example, choose to reward highly productive and nonproductive people equally. I hope most people also believe it is unfair to reward highly productive people and their less productive heirs and associates with almost all the wealth and leave very little for everyone else, productive or not.
Personally, I think it might be fair if each person in the top 10 percent financially in this country were to reach into a big pot with all of today’s U.S. net worth in it, pull out — say — $3 million, and leave the rest of the money in the pot for everybody else. A lovely round figure, $3 million, particularly since the tremendous incomes of the rich would supplement it.
We’re now ready for the math. (Or if math gives you a headache and you trust my calculator, skip to the next paragraph.)
- Number of adults in the U.S.: 209,128,094
- Number in the top 10% financially (1/10 of line 1): 20,912,809
- Number in the bottom 90% (9/10 of line 1: 188,215,285
- U.S. net worth September 2021: $141,700,000,000,000
- Amount for each person in the top 10%: $3,000,000
- Amount for all people in the top 10% (line 5 x line 2): $62,738,427,000,000
- Amount for all people in the bottom 90% (line 4 minus line 6): $78,961,573,000,000
- Amount for each person in the bottom 90% (line 7 divided by line 3): $419,527
Wow! This much?
Yes, $419,527. This would be enough for someone with the $52,940 average American debt per household to pay off that debt and avoid paying a lot of interest. It would also be enough to buy a new car, pay for most prescriptions for a very long time, pay for dental work, sock away college tuition, splurge a bit, and not worry about the rent or the mortgage for quite a long time. Lots of good things can be done with four hundred nineteen thousand five hundred twenty-seven dollars.
What do you think?
Do you think $3 million for a few of us and $419,527 for everybody else would be fair? If you think a rich person wouldn’t be getting enough, keep in mind the $3 million would be in addition to a CEO’s or executive manager’s salary plus perks. Or, if you think the poor should get more, well, you’re a really good person.
If you do think my suggested allocation isn’t fair, get out your own calculator and decide for yourself what would be fair. Replace the dollar amount in line 5, above, with whatever you decide is fair, and do your own math.
Or if you’re saying, “This is a stupid proposition. It’s never gonna happen, so what’s the point?” then what you’ll hear from me is …
Distributing existing wealth would be impossible; you can’t just toss houses, cars, accounts receivable, stocks, and other assets into a pot, no matter how large. Distribution of future net worth might be possible, however, and could be done fairly if it allowed for the fact that some people are highly productive while others are not, and still others cannot be. The challenge is how to create a more fair situation in future.
Giving the current unfair wealth distribution our attention may be the first step toward an eventual fair distribution of wealth.
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