6 thoughts on “Ten mistakes that permeated the Channel 4 ‘How Rich Are You?’ programme on inequality (part 1)”

  1. Posted 13/11/2014 at 15:05 | Permalink

    “There is also a clear lifecycle effect such that as you get older, you are likely to move up the income scale too.”

    How generally true is this? Yes, for managerial/professional careers, but for retail workers, manual workers, taxi-drivers, lorry drivers, bank cashiers? Not meant as a criticism, I just don’t know how true it is.

  2. Posted 14/11/2014 at 22:59 | Permalink

    Just your opinion and you clearly are shocked that not everyone agrees.

  3. Posted 16/11/2014 at 11:37 | Permalink

    These shows are entertainment for those with juvenile minds. No real research is done, and there is no attempt to educate anyone. For what it is worth, I am very careful who interviews me or which forums, conferences, etc. that I attend. Many are a waste of time and nothing more than propaganda, as, apparently, was this program.

  4. Posted 16/11/2014 at 16:28 | Permalink

    Many great points are made in this post. A recurring theme is that the participants in your discussion erred by omission of essential points. A good theme and fair. You, however, have omitted something essential to a full understanding of the problem. As a result, your observations would likely have little or no impact on their thinking, or how they would conduct the program next time.

    In absolute terms, the poor in the US today have treasures beyond the dreams of the wealthiest kings of 300 years ago, e.g., access to healthcare which actually works, absence of warranted fear of famine, air-conditioning, instant/glorious/personalized entertainment, indoor plumbing. . . . Back then the absolute difference in standard of living between the poor and rich was not as great, nor as in the face of the poor as it is today. With respect to their standing in the community, many of the poor (and those who empathize with the poor) perceive themselves to be as farther behind in terms of pecking order than ever – and being out-paced at increasing rates. A major feature of the pecking order problem is that the poor view wealth as a reflection of power (e.g., ability to buy elections), another unquantifiable something which they believe they lack. They are probably correct to a significant degree (although the correlation between money spent and electoral success is not high).

    Because the value of pecking order (standard of living and power) is impossible to quantify or compare, the numbers and concepts you would throw at them (which have little to do with pecking order) will mostly fall on def ears.

    You make great points, but unless you can address the concepts which cause the inequality crowd to think and talk as they do, you will be mostly preaching to the choir.

  5. Posted 21/11/2014 at 18:56 | Permalink

    Whilst the show WAS full of junkonomics the basic theme of the show was correct, that unless you are already wealthy chances are your children (even today’s adult children) will NOT be able to afford to buy their own home.

    I have no problem with people earning billions, all I expect is that they pay a proportional part of their income in tax. If they did this and did not have offshore trusts etc we would not need to tax more than 20%.

    The banks used customer’s money paid into “safe” low interest deposit accounts to gamble. They invented complicated financial instruments to try and hide their bad investments. They sold “bets” on people going bust and of course when they ruined the economy it was us that bailed them out. Yet today our Country pays eye watering income on State debt.

    People with Cancer are kicked out of their homes for getting behind in their mortgage but the people responsible for the financial crisis have never been punished. We give tax breaks to people to buy up property in London only to leave it empty to avoid even more tax.

    The sheer greed of the likes of Westbrook who, despite promises not to, are happy to throw people on the street at Christmas http://bit.ly/1xCxreG has to be curtailed. What we have right now is a Government theme of KNOW YOUR PLACE, it does not matter if you are a millionaire, you are nothing. So whilst you can disown your participation into the programme, the underlying messages of unfairness are real issues in this country.

  6. Posted 22/11/2014 at 16:36 | Permalink

    Jon, You have taken some kernels of truth and ground them into mush.

    While what you say about poor children is statistically true, the chances to own a home of poor children who strive diligently taking advantage of the educational and other opportunities made available to them, work hard to find a job and work hard at it once obtained are quite good. Because so many poor children squander the opportunities made available to them, how much other people pay in taxes has little bearing on the outcomes for poor children you describe. It might be different if government really knew how to help poor children, but it either can’t or won’t.

    Wealthy people do take advantage of loopholes in tax laws, and do not pay a proportional percentage of taxes – they pay considerably more than their proportion part of taxes. The top 10% of income earners pay 68% of all federal income taxes, and pay a disproportionately high percentage of all other taxes. People are not suffering because the rich do not pay a “proportional part” of their income in taxes.

    You talk about a “need to tax more than 20%.” If the “need” is to prevent suffering, you are describing a fool’s errand. Suffering will occur no matter the absolute wealth of the poor. Much suffering (e.g., illness) cannot be eliminated no matter what government or anyone else does. Because government does not know how to help poor people without doing much damage to them. Other than in standard of living, the poor are suffering mightily after at least 50 years and trillions of dollars trying to put an end to the poor’s suffering – and they may be even more unhappy with their standard of living than they were before the War on Poverty began. It appears there is a strong correlation between unhappiness and government “assistance.” Moreover, the absolute standard of living of the poor will improve more rapidly the more government stays out of the way, especially with excessive taxes.

    Other than bankers and politicians, who get their campaigns funded by bankers, you would be hard pressed to find anyone who is in favor of bank bailouts. The banks took the crazy risks they did because they knew the government would bail them out if it went bad (which would necessarily be after they cashed big paychecks creating the problem). Government knew they were creating this moral and risking an economic catastrophe, but did it anyway. You seem to be suggesting politicians should be rewarded for these actions with even more control over the economy.

    While there is debate about how to do it, there is near universal agreement that the deserving poor should be helped (e.g., cancer victims who are bankrupted by medical bills). Businesses striving to make a profit, however, (even if it means some poor people may have to move as a condition of receiving benefits) is not a bad thing. [Your description of the timing of the move in the situation you referenced is both irrelevant to the poor’s standard of living and inaccurate.] Creating wealth is actually what has enabled the “bottom billion” to achieve the unprecedented phenomenal rise in standard of living over the recent history – for the first time ever in history. Are they “wealthy?” No. Are they fabulously wealthier? Yes. Is it because more wealth is tricking down to them? Yes. The absolute standard of living of poor people in wealthy countries has risen considerably as well.

    Whether millionaires know their place or not, and whether or not they shelter some of their income so that it does not get taxed, they pay the vast majority of the taxes to fund the welfare state’s redistribution policies. The value of the benefits received by the poor is far greater than the amount they pay in taxes. Who is paying their fair share is not as easy to answer as your post suggests.

    The poor will always demand that more be redistributed whether or not they understand that the more redistribution there is, the slower the improvement in everyone’s standard of living. Including the poor. Sheer greed on the part of the poor? If one were loose with such epitaphs, one could say so. Regardless of their income, almost everyone always wants more. Whether the poor’s desire for more is greater than the rich’s desire or vis versa would be impossible to determine. It is not impossible to determine that the poor in wealthy countries have amenities which exceed the wildest dreams of kings not long ago. And wealth transfers can only provide amenities, they cannot provide happiness.

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