Occupy [Place] and Inequality

October 13th, 2011
ea, inequality, money, occupy_place
Occupy wall street has been running for almost a month now, and occupy boston almost as long. It's the single largest topic on my facebook newsfeed. Lots of people are saying "we are the 99%". There protesters are a varied group, with lots of different goals and objections, but my understanding is that the biggest objection is financial inequality.

Income inequality in the United States is huge, both in absolute terms and compared to other first world countries. A small number of people with very high paying jobs make much more than most people do; the top 20% earns 60% of total income, and the top 1% earns 25%.

Worldwide, however, income inequality is much larger. And americans are doing quite well. Have a look at this chart:


source and explanation

This chart compares how rich you are within you country to how rich you are in the world as a whole. A straight line going from the lower left to the upper right would indicate a country that exactly mirrored the world in income. A horizontal line would mean very low income inequality in a country, and the height of the line would indicate where their income level was compared to the world. The graph tells us that the poorest 5% in china are as poor as anyone in the world, but the richest 5% are in the top 20% of for world income. Now look at the united states. Our poorest 5% are in the 65th percentile overall. And most of the "99%" are in the top 10% for the world. We are a very rich country.

Fixing inequality in the united states would be good, but it's nowhere near as bad as global inequality. As people in the top 10% (or more) of the world, we have a huge amount of power to help the "global 99%" by earning as much as we can and donating it. If you have the potential to make a lot of money, perhaps even on wall street, you can do much more good by pursuing that career and donating just 10% of your income than you can protesting.

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