Last Call

Pareto's 80-20 rule states that in a capitalist society, the model for sustainable societal "greed" is that the wealthiest 20% of the population will control 80% of the total wealth.  If you subdivide the wealth up again and again, you'll keep finding that 80-20 ratio wherever you go.  If you go upwards, for instance, and subdivide the top 20% again by the 80-20 rule, that leaves 64% of the wealth (80% of 80%) in the hands of the top 4% of the people (20% of 20%).  We're not quite to that level of Pareto distribution yet, but we're very, very close.

Wealth    Population
------    ----------
80%       20%
64%       4%
51.2%     0.8%
40.96%    0.16%
32.96%    0.032%


Let's keep in mind that the total net worth of the US is about 55 trillion dollars last time I checked, and about 310 million people.  That means in a Pareto distribution, the top 100,000 Americans control $18.1 trillion, or about 181 million a piece in net worth.

Run that the other direction...

Wealth    Population

------    ----------

20%       80%
4%        64%
0.8%      51.2%
0.16%     40.96%
0.032%    32.96%

And you see why this sucks.  The bottom 155 million of us are fighting over 0.8% of the total net worth in this country, or 160 million people fighting over out measly $275 bucks a piece.  No wonder we're raging and letting the Tea Party control us.  Better yet, the bottom 40% of have $69 bucks a piece on average.  And the lowest third of us have a whopping $17.60 a piece.

The richest Americans are worth billions.  The poorest of us, millions of us, are literally worth less than twenty bucks.  Lots of us are so far in debt we're in negative net worth...we owe more than we're worth.  Again, we're not quite to the Pareto boundary, but we're damn, damn close in America.

So if you're wondering why going from 36% to 39.6% on the top marginal tax rate is being so vigorously opposed by the rich, well, to be fair, that 3% really is worth billions of dollars.  They can afford it, of course.  The alternative is to take it out of the rest of us.

How's your $287 holding up?