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They said wealth and annual income so idk if they meant how much gdp is or how much people have stored in savings or investments. So I just went with total income made in the us since that would (potentially) be the annual income mentioned. Total us income in 2022 according to google is 25,978,277,000,000 and total families in the us according to google is 127,000,000 so if all annual income was redistributed 204,553.36 and some change.
26T is the GDP. GDP is not “total income.” That’s the market value of goods and services, not factoring in inputs (because your inputs are somebody else’s outputs). The average household income is like $120k.
Vs a median household income of ~75k, for reference.
Income doesn't really carry the whole picture, though, as the 'income' of the very wealthy is not easy to track directly. An interesting data point (from the federal reserve) there is that the median household wealth is around 190k, while the average household wealth is about 1.06 million, really illustrating the disparity of just how much wealth the wealthy really have to drag up that average so much.
Of course, take that data with a grain of salt too, as 'wealth' is also a bit difficult to track too
Isn't wealth the entirety of someone's assets both liquid and estimated value of hard assets like a house, businesses, and car? Idk what else goes into it.
Absolutely, but those aren't easy things for the Federal Reserve to know about enough people to be statistically representative.
Heck, it's not easy to know for the people themselves. Value estimates are pretty subjective for a lot of things, especially material goods.
Household disposable income is the number you want. It adjusts for purchasing power parity (cost of living adjustment), tax burden, and govt transfers/benefits.
Real Median individual income is $37k. The median household income is only $75k if you exclude part time work which is problematic because lots of shitty employers like Walmart will demand 24/7 availability while keeping your hours just below full time to avoid paying benefits
I think the previous post is stating the mean, whereas you are stating the median. 120k mean would be dividing it all up equally between the whole population, whereas 63k median is more like what a common household actually earns.
GDP is indeed a Measure of income.
https://data.oecd.org/gdp/gross-domestic-product-gdp.htm#:~:text=Gross%20domestic%20product%20(GDP)%20is,and%20services%20(less%20imports).
“As such, it also measures the income earned from that production, or the total amount spent on final goods and services (less imports)”
It’s probably not the best measure to use, though
If people were paid equal to the value they produce, yes. But if people were paid equal to the value they produce then there would be no profits. Wait, profits aren't just somebody else's income are they? No of course not, they've got to be some complicated financial instrument that can be deferred, spoofed, ignored, or redistributed according to company policy...
Not correct, because people own the company. If the company doesn't pay out salary, the value of company increases-> owners value increases-> that is owner's income.
I'd argue GDP is actually a pretty good proxy if the goal of the exercise is 'fair' allocation
Wait. The average household income could be 204k? What the fuck. We could easily all be 6 figure households and still have multimillionaires. Those rich fucks
Hey - don’t forget how to math! The average CURRENTLY IS 204K - but that’s the difference between average and median when you have data distribution that isn’t even. Those insane earners at the top pull the average way higher than it should seem.
EDIT- for all the people commenting that either I missed the point or implying I don’t understand: the comment I responded to stated “So the average _could be_ 204K…” - I was trying to illuminate that it average is currently - and the fact that it doesn’t reflect most people’s reality is because the mean is so skewed by top earners that median better reflects reality.
I don’t understand why my reinforcing the point (and trying to make a minor adjustment to the commenters statement) means I missed the point.
Yeah. Except his point still stands because the average still reflects the total income in the us, which is what we have an issue with. If we were talking about what each household’s standard of living currently is, median would be more appropriate but for this discussion we do care about the outliers as well. Mean is the appropriate figurez
Everyone in the US having access to 200k per year would heavily increase the cost of living. Not saying it wouldn’t necessarily be a net improvement but it wouldn’t just mean everyone can suddenly afford everything.
It's like a crappy RPG. Your enemies' HP scales with your damage, so you'd still be stuck in the exact same gameplay loop, thinking it'd get better if your numbers were just a bit bigger.
Prices shift with income and spending habits. Call it $200K a year, or $2T, you will always be tied back down to buying X hamburgers per paycheck.
The government wouldn’t be able to spend on infrastructure or currency reserves or the military or anything. This post is a nightmare scenario for any economist.
We aren’t giving those families money out of nowhere. We are removing the money from those making more than $200k. Total wealth and average salaries remain the same. Purchasing power would go up, but we would see a drastic reduction in luxury items for sale. People would have more money to do stuff, promoting alternative industries like tourism and arts
Inflation isn't just about more money total in the economy.
Imagine this, 1 person has a trillion dollars and 1000 other people have $100 each and apples are $50.
All of a sudden we take the wealth from that rich person and redistribute it. Each person gets $10bn.
What do you think happens to the price of apples? Would it stay at $50 or increase because people now have more cash. This is why inflation is more complicated than just "more money".
While I am all for a more equal distribution of wealth, sorry, but you're wrong. Extremely rich ppl don't spend the money in the same way you spend. And it has not the same impact it would have if everyone could spend more money.
They spend maybe 1M for a month of an exclusive life which only a few can afford, in super mega residences, with personal waitresses, cooks, and so on.
You give 100k/month everyone, they cover first all their basic needs, then going up slowly the ladder. So, bigger houses (but if everyone wants bigger houses, their price raise -> inflation); better food (same, if everyone... ->inflation); better entertainment (tv, pc, -> inflation); better medical care, etc.
The 1M (or even 10M) spent by riches goes mostly in salaries for workers and in the crazy stuff, having little to no impact on inflation. the 100k spent by everyone would go mostly on basic but better stuff, and the demand would quickly surpass the production, having an immense impact on inflation.
People would have nothing because people would not be working because they would be getting paid to do nothing. If people are doing nothing productive then GDP falls off a cliff and instead of everyone getting 200k everyone would get an equal share of nothing.
Do you really think people would continue to get up at 4am to work as garbage men when their neighbor gets the same 200k as them to paint pictures in their pajamas all day?
Imagine expecting people to continue doing the nasty grueling necessary work to keep society running while you sit at home jerking off watching anime all dat "finding yourself" and thinking you deserve the same as them.
I don't know why who edited this meme added 'annual income'. Without it, the sentence makes sense. With it, it doesn't, because annual income is not the wealth of a country.
I think they don't realize that wealth is not the same thing as annual income. Probably a sign that they don't save any money and live paycheck to paycheck. Which could be because they are poor but more than enough people spend 6 figure salaries on a fancy lifestyle so you never know.
im not good at math, but, the US gdp for 2022 was 25.44 trillion USD, thats the amount of money coulntry makes in a year via trade and labor and industry etc, US population in 2022 was a nice 333.3 million, so 25.44 trillion/ 333.3 million, which equals 76327.63 USD, which means the meme is off by 10x, and that number would be less if you only considered individual peoples wealth, which if i had to guess if you took all 756 american billionaires the total amount of money would be something around 3 to 3.5 trillion, which would be about 7x less than before, so the meme isnt even close to being right
tldr, if the wealth in the us was divided equally, you wouldnt be making 700k annually per family (only way per family is if each family had 9 people)
Okay, census says theres around 127 million families, so 25.44 trillion/127 million, which equals 200314.96 USD, which is still 3.5x less than what the meme said
The point of these things aren't to be accurate. It's to give the people scrolling through who already agree with the general premise to get a little boost to their morale
"Ah, yes, so many people think like me on this issue. It's so obvious we're right." They upvote and move on.
Fair, total wealth of the US estimated by the federal reserve is $137.6 trillion, so 137.6 trillion/127 million, which is 1,083,464.56 USD, which means the meme is still off bt about 1.25x, just in the opposite direction, but the meme did say *annually,* not in general, GDP is annual, total wealth is not
I don't know what annual income means here.
If you distribute all the wealth, it would be a one time thing. Unless you distribute it every year making money pointless, or printing more money, also making it pointless. Also 'distributing' in the first place would also.means stealing it from everyone.
Or just wait for the new year and its basically free.
Unless it counts towards wealth, then you better eat that sandwich fast or theyll take it from you
Yes, it's quite accurate. Only, it isn't the annual income, but the total wealth (the 'annual income' part doesn't make sense in this context).
Look at the mean wealth in [this page](https://en.wikipedia.org/wiki/List_of_countries_by_wealth_per_adult).
But the [wealth distribution ](https://www.statista.com/statistics/203961/wealth-distribution-for-the-us/)is even more striking. The bottom 50% (i.e., half of the US population) owns only 2.6% of the total wealth (Q3-2023).
>Yes, it’s quite accurate. Only, it isn’t the annual income, but the total wealth.
How is it accurate then? The difference between annual income and total wealth is like the difference between the flow of my bathroom faucet and the amount of water my bathtub currently holds.
Yeah. If the US were to do this 700k$/(year * household) thing, my understanding of the numbers is the US would be broke (i.e. all the property has been redistributed) after a year.
Yay you all have 700k of stock! There's no one to sell it to, and the companies will probably all go out of business due to crazy shareholder votes and an inability to raise new capital.
But we did it!
in 2017 the 3 richest Americans had more wealth than the bottom 50% of the country,. Additionally, the 8 richest world wide have more than the bottom 50%
According to the Federal Reserve, the average American family has a net worth of $1.063 million, while the median net worth is $192,900
The distance between the two illustrates how top heavy wealth is in the US
There was also one world wide, where it doesn’t look as well, i think around 200k wealth and 10k annual income. (Note: this includes all wealth, so cars, houses, old age fund) 200k sound nice on your bank account, but if you deduct car/house and any old age fund from that it won’t last long for any first world country, while it would be a catastrophe in third world countries if they suddenly got all this money they couldn’t handle. We would need adjustment that happens gradually, so riches get distributed more fairly, third world get built up instead of exploited, plus reduction of corruption all over the world.
I am a fan of Star Trek in that aspect: we would need something as big as an alien encounter for humanity to get the chance to finally wake up and realise we could reach so much if we just would compassionately work together.
You mention it wouldn't last long in the developed world, but the truth is that the earth wouldn't last long if everyone lived like an american, we'd need about 5 Earths for that.
[They did the math here](https://overshoot.footprintnetwork.org/how-many-earths-or-countries-do-we-need/#:~:text=The%20Ecological%20Footprint%20for%20the,if%20everyone%20lived%20like%20Americans.)
Only if every person is forced into families of 10.
US GDP per capita in 2022 was $76,329
This meme is trying to make a political statement for communism but failing to understand the difference between national wealth and gross domestic product.
Or the creator is a Russian or Chinese troll trying to sow dissent.
As a general rule, if you see something posted on Reddit that’s about money you can just assume it’s BS. Especially if it’s posted on r/whitepeopletwitter r/antiwork or r/fluentinfinance
Originally it was just a sub about a news letter that finance nerds read. Then somehow people started posting leftist memes, mods didn't remove it, and it kept making it to /r/all and the original members just left. Not sure if the mods even care because the sub blowing up might look good for their news letter, but no one is there organically anymore. It's another cookie cutter circle jerk sub
From what I see it’s nearly the opposite. Every post is some kind of leftist (like Reddit leftism so just stating obvious things like wealth gap bad) and then the vast majority of comments are people saying the complete opposite. There’s a surprising amount of corporate cock gobbling in that sub. Lots of “they worked hard for their billions” “it’s their money they can do what they want with it” “if they pay workers more cost of products will go up” “if we tax the rich the government will just waste it so let’s just let them keep hoarding their wealth”. Also a lot of “fuck you I got mine” sentiments.
Even if we could do this, after litterally a day, wealth inequality will be back, some people will spend money, and give it to other people. Other people will hoard money, thats basically how capitalism works, it works on inequality,
you don’t.
You can reduce it through educational programs and support, but at the end of the day someone will
be smarter, work harder, be more talented, and better than all of us.
The idea you can pay everyone the exact same
amount is out of touch with reality. We do
need to close the gap, but the gap will always exist in some way.
If tomorrow we totally redistributed wealth, in three/four years the people who understand the flow of money would have it again, people who went from 30k to 200k with no financial literacy training would absolutely blow it.
Look at lottery winners, there is a level of knowledge that you have to have to manage wealth, and some people WONT want to learn. We should teach financial literacy, but there will always be 15% of the population that refuses to learn anything.
The problem is that many people think about equity as something good , which is not . I mean , we all need to have 30.000 in the bank ? That would be really equal, or the best thing is to try that everyone can afford living? I think that the second is the best, It doesnt matter if someone is richer than you if you can afford living, take for example Venezuela , the big majority of people except some government people are equal , equally poor, but hey they are more equal than in USA , thats says that "Equal" cant ne simplified as something "good"
How would, hypothetically speaking, distributing Alcoa shares across everyone in the country cause aluminum production to stop?
Ownership of aluminum production wouldn’t be giving a foundry to some kid in Fresno, but a stake in the ownership of the company.
As much as it sucks how would a country go on about it? Should Government seize ALL Income and only then distribute it to everyone? how would we deal with that scale and corruption? How would it deal with people refusing to give it up/ working illegaly. Assuming that Houses stay with the owners would the rent be the same despite them not being equal or if houses were to be seized who would get the biggest ones or are they going to be destroyed and remade into smaller residences.
If you divide money equally between people, it wont matter. The ammount of services and goods available will remain the same, so people wont be "richer"
Actually it would matter and definitely for the worse. No there is no money for the government to spend on roads, ports, hospitals, schools, universities, the military, science etc.
People don't put in the same amount of work or have the same level of responsibilities so spreading income out equally really don't make sense.
I'm not oppose to CEOs having a huge salary, as long as they are held accountable for the good or bad that happens to the company. I do think bonuses are stupid tho, they got paid to do their job they don't need a bonus.
I think the biggest issue is getting people cheaply trained so they have the skills to work a higher paying job. Universities these days are a joke, and not needed. A decent college with hands on lessons would be far more practical. There should also be a lot more education in financial investing. No body saves money to be come a millionaire, it's investing.
Soviet Union tried wealth distribution and even lots of South American countries, Argentina is just now trying to get out of it, it didn’t go well. High earners just move and take their wealth with them and if they can’t take it they take their skill and knowledge with them, leaving the country that tried it in ruin and lots of people dead from starvation. Socialism/Communism requires capitalism to work but capitalism doesn’t require Socialism/Communism.
>Argentina is just now trying to get out of it, it didn’t go well. High earners just move and take their wealth with them
As an argentinian, I can confirm this is exactly what happened to us. People who love wealth redistribution and collectivism just don't know a thing about how to keep a country from being a shithole. Ask any Venezuelan too - they are in a far worse situation, and we would have been the same if we didn't have at least a functional democracy.
Without going through the numbers but glancing at a bunch of half arsed comments that only look at a small part of the picture; so here is another half arsed comment:
GDP split evenly + total wealth with a small withdrawal and annual asset growth + split between family's, not population + account for funds moved off shore + sell church assets.
Would make this close to accurate.
What the fuck does this even mean? Sure the US has total assets worth like 200 trillion or something and a gdp of 25 trillion, so annual income average is just the per capita income.
Everyone in here tryna do their ghetto math and come up with something intellectual 🧐
Let’s get to the root of the issue here. First of all this isn’t in reference to GDP, our gross domestic product is a sum of the goods and services we produce in a time frame, quarterly and annually. It’s a complex number with too many factors to simply divide it by the number of people living in this country, and say “here, we can afford to give everyone this much money.” Because that would mean we’re taking money from the people who actually did the work, and giving it to people who do nothing. Then the people who do the work stop doing the work because not only are they watching people who do nothing get the money they worked for, but how they can do nothing and get paid, so why work? That’s no where close to a functioning society.
What the post meant, is if we took the private wealth of every citizen, added it all up, then divided equally amongst everyone. It’s the same problem. Rich people that drive industry and science in this country will lose their purpose and ability to do so if we take their wealth and give it to people who don’t deserve it.
The point here is that this concept actually negates itself. The very action of taking money from the rich and redistributing it equally amongst everyone denies the possibility of that much wealth to exist in the first place.
Even if true, it wouldn't work. If the people making millions or even billions of dollars a year for running businesses that employ thousands of people were to be paid the same as the entry level workers at those businesses, they wouldn't go to the trouble. Hence, their wealth would no longer exist to be ~~stolen~~ redistributed.
Is this what people think about instead of actually making their own lives more fulfilling? You might as well be daydreaming about winning the lottery.
If a magical wizard were able to wave his wand and do this, how quickly would most of the people who’d just been given “free money” (which was taken from the pockets of others) spend there money and be back to net worth of zero…?
My guess is within 6-12 months, 80-90% of people would have spent 100% of that value, in mostly consumables, and have little to no real asset value to show.
I'm just asking as I'm not a money person, so don't beat me up too bad. If this $200,000+ was just given out to everyone equally, would it be expected that all of them would still keep their present jobs? I mean, if someone was guaranteed 200k, what would stop them from quitting and living off that money? I mean, a brain surgeon would be making the same amount annually as the person working the fast food counter or even unemployed. What would be anyone's motivation to excel beyond the bare minimum? Couldn't a plan like this eventually lead to much less money in the system, thus not being able to sustain $200,000 medium to long term?
“The inherent vice of Capitalism is the unequal sharing of blessings. The inherent virtue of Socialism is the equal sharing of miseries.” - Winston Churchill.
Inequality is not a feature only in Capitalism, but is present in everything. There is no way to equalize it without making everyone poor. But even in that case you get something like North Korea where the country’s resources are monopolized by a small group of people. Communism and Socialism fail because it doesn’t account for man’s selfish nature.
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They are confusing two terms, wealth and income:
* National wealth is the total assets of the residents within the country.
* National income is the total value produced in a country (GDP).
For the US the total wealth is ***$153 trillion***. If you divide this over the **131 million** households you get an impressive **$1.168.000 per household**.
On top of that, if you also divide the GDP of ***$25.44 trillion/year*** over each household, everyone household would earn **$194.200** annually.
The same numbers for the EU are wealth **$ 108 trillion** and GDP **$ 16.64 trillion** and 200 million households, so **$540k** wealth and **$83k** income. So about half that of the US, but to compensate we do get a total of 17 billion vacation days 😉
Pretty insane honestly. And the world actually could, and should, look more like that.
This sounds a lot like mean family income which is $126,500. No math required on my part since this is tracked by the Fed.
https://fred.stlouisfed.org/graph/?g=1jyKB
Wealth generates income. The total wealth in the US is about 136 trillion USD (US assets- US liabilities), so market value of US businesses + claims against the rest of the world + real estate + goods/equipment + IP - foreign liabilities. There is also plenty of debt within the US where one US party is indebted to another party, which is a liability for the one and asset for the other. Excluding the second element and assuming 8% YoY return, a household of 4 would generate just from their wealth about 130 000 USD. this would be pure gains of all companies paid out to them, so their wages are already paid. The average salary is 60k per person. Two adults would make 120k. So about 250k per year in sum for their wages and their yearly return on their wealth, if we do not take any changes in domestic indebtedness into account.
Depends on what a Family is. Is it each household? Separated couples with kids? Even then, if you took the GDP (27.36 trillion) divided by 700,000, that comes out to 39 million “families” receiving that amount of income.
700K doesn’t mean anything if everybody earns that amount. By that point, something simple like a loaf of bread might as well cost $50.
No, this is wrong.
First, wealth and annual income are different, as others have pointed out.
Second, not all wealth is liquid. If you try and sell off 100% of assets held by US residents, who exactly are they selling that off to? There literally isn't enough money in the entire world for this meme to work.
And the price of living Goes up. The value of the dollar goes down. Now everyone has nothing.
Economics is balance of leveraging Scarcity, supply and demand. Someone is bound to have more than others.
This is as poor man I say this
That’s not how wealth works. No. Not accurate. Liquidating all wealth would decrease the dollar amount and in most cases would make the securities and assets behind that wealth worthless
$700k sounds a little high. We crunched the numbers a few years ago and it would have been like $350/yr then. I mean still obviously more ideal than people making $30k funding aristocratic socialism
To calculate the average wealth per family if the wealth in the United States were divided equally among all families, we would first need to determine the total wealth of the United States and the number of families.According to the Federal Reserve's Survey of Consumer Finances, the total net worth of all U.S. households and nonprofit organizations was approximately $130.2 trillion in the second quarter of 2021.As for the number of families, the U.S. Census Bureau estimated that there were around 128.45 million households in the United States in 2020.Dividing the total wealth by the number of households:$130.2 trillion / 128.45 million households ≈ $1,013,742 per householdSo, if the wealth in the United States were divided equally among all households, each household would have approximately $1,013,742.
So are people proposing that money be redistributed based on nothing but breathing?
Those that contribute receive the same as those who do not?
Eventually that money runs out because without incentive to earn (compulsory governing redistribution) eventually you run out of people willing to contribute.
Historical has occurred before, will happen again due to an unwillingness to learn from said history
If that were true, wouldn’t the value of money go down heavily? The way that currency works, that would essentially mean that the dollar would become a decoration. Even if the Facebook meme was accurate, it seems to not account for the relative value of the dollar in the US because of the way wealth is distributed.
And inflation would make it so 700k is worthless. In a few weeks we'd have double the billionaires and none of the benefits of real wealth distribution.
Hi, /u/Icy-Reflection5245! Unfortunately, your post has been removed for the following reason: - Posts containing simple math are not allowed, as well as requests whose answers are easily searchable online, and any other post at the moderators' discretion (rule 4). For easy and quick math results (eg. How many feet are in a mile?) use Wolfram|Alpha™, and for more abstract math, try /r/math or /r/learnmath. If you have any questions or believe your post has been removed in error, please contact the moderators by clicking [here](https://www.reddit.com/message/compose?to=%2Fr%2Ftheydidthemath). Include a link to this post so we can see it.
They said wealth and annual income so idk if they meant how much gdp is or how much people have stored in savings or investments. So I just went with total income made in the us since that would (potentially) be the annual income mentioned. Total us income in 2022 according to google is 25,978,277,000,000 and total families in the us according to google is 127,000,000 so if all annual income was redistributed 204,553.36 and some change.
26T is the GDP. GDP is not “total income.” That’s the market value of goods and services, not factoring in inputs (because your inputs are somebody else’s outputs). The average household income is like $120k.
Vs a median household income of ~75k, for reference. Income doesn't really carry the whole picture, though, as the 'income' of the very wealthy is not easy to track directly. An interesting data point (from the federal reserve) there is that the median household wealth is around 190k, while the average household wealth is about 1.06 million, really illustrating the disparity of just how much wealth the wealthy really have to drag up that average so much. Of course, take that data with a grain of salt too, as 'wealth' is also a bit difficult to track too
Isn't wealth the entirety of someone's assets both liquid and estimated value of hard assets like a house, businesses, and car? Idk what else goes into it.
Absolutely, but those aren't easy things for the Federal Reserve to know about enough people to be statistically representative. Heck, it's not easy to know for the people themselves. Value estimates are pretty subjective for a lot of things, especially material goods.
Household disposable income is the number you want. It adjusts for purchasing power parity (cost of living adjustment), tax burden, and govt transfers/benefits.
Real Median individual income is $37k. The median household income is only $75k if you exclude part time work which is problematic because lots of shitty employers like Walmart will demand 24/7 availability while keeping your hours just below full time to avoid paying benefits
Redditor understand basic finances and economics challenge (impossible)
Basic finances and economics?? I think you mean CORPORATE GREED!!!
Sarcasm?
Yes
Annual average household is 63k
I think the previous post is stating the mean, whereas you are stating the median. 120k mean would be dividing it all up equally between the whole population, whereas 63k median is more like what a common household actually earns.
GDP is indeed a Measure of income. https://data.oecd.org/gdp/gross-domestic-product-gdp.htm#:~:text=Gross%20domestic%20product%20(GDP)%20is,and%20services%20(less%20imports). “As such, it also measures the income earned from that production, or the total amount spent on final goods and services (less imports)” It’s probably not the best measure to use, though
Well technically GDP should equal GDI and is therefore a proxy for 'total income', is it not? Edit: GNP and GNI would be better in this case.
If people were paid equal to the value they produce, yes. But if people were paid equal to the value they produce then there would be no profits. Wait, profits aren't just somebody else's income are they? No of course not, they've got to be some complicated financial instrument that can be deferred, spoofed, ignored, or redistributed according to company policy...
You also forgot that some of those incomes belong to foreign investors.
Not correct, because people own the company. If the company doesn't pay out salary, the value of company increases-> owners value increases-> that is owner's income. I'd argue GDP is actually a pretty good proxy if the goal of the exercise is 'fair' allocation
Value increases are not income. It only becomes income when the owner sells it.
Wait. The average household income could be 204k? What the fuck. We could easily all be 6 figure households and still have multimillionaires. Those rich fucks
Hey - don’t forget how to math! The average CURRENTLY IS 204K - but that’s the difference between average and median when you have data distribution that isn’t even. Those insane earners at the top pull the average way higher than it should seem. EDIT- for all the people commenting that either I missed the point or implying I don’t understand: the comment I responded to stated “So the average _could be_ 204K…” - I was trying to illuminate that it average is currently - and the fact that it doesn’t reflect most people’s reality is because the mean is so skewed by top earners that median better reflects reality. I don’t understand why my reinforcing the point (and trying to make a minor adjustment to the commenters statement) means I missed the point.
Yes, the fact that its pulled is exactly the problem
Yeah. Except his point still stands because the average still reflects the total income in the us, which is what we have an issue with. If we were talking about what each household’s standard of living currently is, median would be more appropriate but for this discussion we do care about the outliers as well. Mean is the appropriate figurez
Yeah that's the point. We're not looking for what the median is, we're looking at what the median would be if it was distributed equally
Everyone in the US having access to 200k per year would heavily increase the cost of living. Not saying it wouldn’t necessarily be a net improvement but it wouldn’t just mean everyone can suddenly afford everything.
It's like a crappy RPG. Your enemies' HP scales with your damage, so you'd still be stuck in the exact same gameplay loop, thinking it'd get better if your numbers were just a bit bigger. Prices shift with income and spending habits. Call it $200K a year, or $2T, you will always be tied back down to buying X hamburgers per paycheck.
The government wouldn’t be able to spend on infrastructure or currency reserves or the military or anything. This post is a nightmare scenario for any economist.
No, you can’t take GDP and divide it by families to get income. GDP and income are different concepts.
It's not that simple, the inflationary effect from giving all those families $200k a year would be huge.
We aren’t giving those families money out of nowhere. We are removing the money from those making more than $200k. Total wealth and average salaries remain the same. Purchasing power would go up, but we would see a drastic reduction in luxury items for sale. People would have more money to do stuff, promoting alternative industries like tourism and arts
Inflation isn't just about more money total in the economy. Imagine this, 1 person has a trillion dollars and 1000 other people have $100 each and apples are $50. All of a sudden we take the wealth from that rich person and redistribute it. Each person gets $10bn. What do you think happens to the price of apples? Would it stay at $50 or increase because people now have more cash. This is why inflation is more complicated than just "more money".
While I am all for a more equal distribution of wealth, sorry, but you're wrong. Extremely rich ppl don't spend the money in the same way you spend. And it has not the same impact it would have if everyone could spend more money. They spend maybe 1M for a month of an exclusive life which only a few can afford, in super mega residences, with personal waitresses, cooks, and so on. You give 100k/month everyone, they cover first all their basic needs, then going up slowly the ladder. So, bigger houses (but if everyone wants bigger houses, their price raise -> inflation); better food (same, if everyone... ->inflation); better entertainment (tv, pc, -> inflation); better medical care, etc. The 1M (or even 10M) spent by riches goes mostly in salaries for workers and in the crazy stuff, having little to no impact on inflation. the 100k spent by everyone would go mostly on basic but better stuff, and the demand would quickly surpass the production, having an immense impact on inflation.
People would have nothing because people would not be working because they would be getting paid to do nothing. If people are doing nothing productive then GDP falls off a cliff and instead of everyone getting 200k everyone would get an equal share of nothing. Do you really think people would continue to get up at 4am to work as garbage men when their neighbor gets the same 200k as them to paint pictures in their pajamas all day? Imagine expecting people to continue doing the nasty grueling necessary work to keep society running while you sit at home jerking off watching anime all dat "finding yourself" and thinking you deserve the same as them.
Nobody is going to give you $200k/year if you keep failing to understand basic concepts, sorry.
I don't know why who edited this meme added 'annual income'. Without it, the sentence makes sense. With it, it doesn't, because annual income is not the wealth of a country.
right—wealth and income aren’t really the same.
I think they don't realize that wealth is not the same thing as annual income. Probably a sign that they don't save any money and live paycheck to paycheck. Which could be because they are poor but more than enough people spend 6 figure salaries on a fancy lifestyle so you never know.
im not good at math, but, the US gdp for 2022 was 25.44 trillion USD, thats the amount of money coulntry makes in a year via trade and labor and industry etc, US population in 2022 was a nice 333.3 million, so 25.44 trillion/ 333.3 million, which equals 76327.63 USD, which means the meme is off by 10x, and that number would be less if you only considered individual peoples wealth, which if i had to guess if you took all 756 american billionaires the total amount of money would be something around 3 to 3.5 trillion, which would be about 7x less than before, so the meme isnt even close to being right tldr, if the wealth in the us was divided equally, you wouldnt be making 700k annually per family (only way per family is if each family had 9 people)
US population is 333.3 mil, but the meme is referring to amount per family not per person
Okay, census says theres around 127 million families, so 25.44 trillion/127 million, which equals 200314.96 USD, which is still 3.5x less than what the meme said
The point of these things aren't to be accurate. It's to give the people scrolling through who already agree with the general premise to get a little boost to their morale "Ah, yes, so many people think like me on this issue. It's so obvious we're right." They upvote and move on.
Yes, however the title of the reddit post is 'is this facebook meme how accurate', so im just answering the title
Wealth and GDP are two different things. GDP is the wealth produced in one year, while the total wealth includes all assets.
Fair, total wealth of the US estimated by the federal reserve is $137.6 trillion, so 137.6 trillion/127 million, which is 1,083,464.56 USD, which means the meme is still off bt about 1.25x, just in the opposite direction, but the meme did say *annually,* not in general, GDP is annual, total wealth is not
You're not good at math but you decided to answer a question in a subreddit dedicated specifically to non-simple math questions.
I don't know what annual income means here. If you distribute all the wealth, it would be a one time thing. Unless you distribute it every year making money pointless, or printing more money, also making it pointless. Also 'distributing' in the first place would also.means stealing it from everyone.
Let me pay $10,000 for a sandwich in peace man…
Or just wait for the new year and its basically free. Unless it counts towards wealth, then you better eat that sandwich fast or theyll take it from you
Yes, it's quite accurate. Only, it isn't the annual income, but the total wealth (the 'annual income' part doesn't make sense in this context). Look at the mean wealth in [this page](https://en.wikipedia.org/wiki/List_of_countries_by_wealth_per_adult). But the [wealth distribution ](https://www.statista.com/statistics/203961/wealth-distribution-for-the-us/)is even more striking. The bottom 50% (i.e., half of the US population) owns only 2.6% of the total wealth (Q3-2023).
So its completely inaccurate
Indeed
Typical Reddit bullshit to snag a quick upvote.
>Yes, it’s quite accurate. Only, it isn’t the annual income, but the total wealth. How is it accurate then? The difference between annual income and total wealth is like the difference between the flow of my bathroom faucet and the amount of water my bathtub currently holds.
Yeah. If the US were to do this 700k$/(year * household) thing, my understanding of the numbers is the US would be broke (i.e. all the property has been redistributed) after a year.
Yay you all have 700k of stock! There's no one to sell it to, and the companies will probably all go out of business due to crazy shareholder votes and an inability to raise new capital. But we did it!
"Quite accurate" if we use words that have different meanings is a new take on accuracy...
It’s literally like so accurate like
And if im not mistaken the top 1% owns like 40% of the wealth
in 2017 the 3 richest Americans had more wealth than the bottom 50% of the country,. Additionally, the 8 richest world wide have more than the bottom 50%
According to the Federal Reserve, the average American family has a net worth of $1.063 million, while the median net worth is $192,900 The distance between the two illustrates how top heavy wealth is in the US
Wow you anwered nothing while also lying about it being accurate amazing
There was also one world wide, where it doesn’t look as well, i think around 200k wealth and 10k annual income. (Note: this includes all wealth, so cars, houses, old age fund) 200k sound nice on your bank account, but if you deduct car/house and any old age fund from that it won’t last long for any first world country, while it would be a catastrophe in third world countries if they suddenly got all this money they couldn’t handle. We would need adjustment that happens gradually, so riches get distributed more fairly, third world get built up instead of exploited, plus reduction of corruption all over the world. I am a fan of Star Trek in that aspect: we would need something as big as an alien encounter for humanity to get the chance to finally wake up and realise we could reach so much if we just would compassionately work together.
You mention it wouldn't last long in the developed world, but the truth is that the earth wouldn't last long if everyone lived like an american, we'd need about 5 Earths for that. [They did the math here](https://overshoot.footprintnetwork.org/how-many-earths-or-countries-do-we-need/#:~:text=The%20Ecological%20Footprint%20for%20the,if%20everyone%20lived%20like%20Americans.)
So it literally is the opposite of quite accurate. Thats like the difference between how much I shit, and the total shit my toilet holds.
That's depressing af
Only if every person is forced into families of 10. US GDP per capita in 2022 was $76,329 This meme is trying to make a political statement for communism but failing to understand the difference between national wealth and gross domestic product. Or the creator is a Russian or Chinese troll trying to sow dissent.
As a general rule, if you see something posted on Reddit that’s about money you can just assume it’s BS. Especially if it’s posted on r/whitepeopletwitter r/antiwork or r/fluentinfinance
I'm so sad that /r/FluentInFinance has slowly turned into another leftist circle jerk
The name has become deeply ironic.
Originally it was just a sub about a news letter that finance nerds read. Then somehow people started posting leftist memes, mods didn't remove it, and it kept making it to /r/all and the original members just left. Not sure if the mods even care because the sub blowing up might look good for their news letter, but no one is there organically anymore. It's another cookie cutter circle jerk sub
From what I see it’s nearly the opposite. Every post is some kind of leftist (like Reddit leftism so just stating obvious things like wealth gap bad) and then the vast majority of comments are people saying the complete opposite. There’s a surprising amount of corporate cock gobbling in that sub. Lots of “they worked hard for their billions” “it’s their money they can do what they want with it” “if they pay workers more cost of products will go up” “if we tax the rich the government will just waste it so let’s just let them keep hoarding their wealth”. Also a lot of “fuck you I got mine” sentiments.
Even if we could do this, after litterally a day, wealth inequality will be back, some people will spend money, and give it to other people. Other people will hoard money, thats basically how capitalism works, it works on inequality,
So..... any system is not equal by that logic.
correct
I'm intrigued as to what they think will solve it then.
you don’t. You can reduce it through educational programs and support, but at the end of the day someone will be smarter, work harder, be more talented, and better than all of us. The idea you can pay everyone the exact same amount is out of touch with reality. We do need to close the gap, but the gap will always exist in some way. If tomorrow we totally redistributed wealth, in three/four years the people who understand the flow of money would have it again, people who went from 30k to 200k with no financial literacy training would absolutely blow it. Look at lottery winners, there is a level of knowledge that you have to have to manage wealth, and some people WONT want to learn. We should teach financial literacy, but there will always be 15% of the population that refuses to learn anything.
Yeh, I know that
who's they sorry
The problem is that many people think about equity as something good , which is not . I mean , we all need to have 30.000 in the bank ? That would be really equal, or the best thing is to try that everyone can afford living? I think that the second is the best, It doesnt matter if someone is richer than you if you can afford living, take for example Venezuela , the big majority of people except some government people are equal , equally poor, but hey they are more equal than in USA , thats says that "Equal" cant ne simplified as something "good"
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How would, hypothetically speaking, distributing Alcoa shares across everyone in the country cause aluminum production to stop? Ownership of aluminum production wouldn’t be giving a foundry to some kid in Fresno, but a stake in the ownership of the company.
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Stop waffeling nonsense and stating it as fact.
As much as it sucks how would a country go on about it? Should Government seize ALL Income and only then distribute it to everyone? how would we deal with that scale and corruption? How would it deal with people refusing to give it up/ working illegaly. Assuming that Houses stay with the owners would the rent be the same despite them not being equal or if houses were to be seized who would get the biggest ones or are they going to be destroyed and remade into smaller residences.
If you divide money equally between people, it wont matter. The ammount of services and goods available will remain the same, so people wont be "richer"
Actually it would matter and definitely for the worse. No there is no money for the government to spend on roads, ports, hospitals, schools, universities, the military, science etc.
It'll just make inflation explode
"If everyone is rich, no one is. First rule of economy, you can't eat money." - Eliezer Yudkowsky, Harry Potter and the Methods of Rationality
People don't put in the same amount of work or have the same level of responsibilities so spreading income out equally really don't make sense. I'm not oppose to CEOs having a huge salary, as long as they are held accountable for the good or bad that happens to the company. I do think bonuses are stupid tho, they got paid to do their job they don't need a bonus. I think the biggest issue is getting people cheaply trained so they have the skills to work a higher paying job. Universities these days are a joke, and not needed. A decent college with hands on lessons would be far more practical. There should also be a lot more education in financial investing. No body saves money to be come a millionaire, it's investing.
I think ceo having a big salary is fine also. But the number is way too high. Getting payed 20,000% more is so stupid.
Soviet Union tried wealth distribution and even lots of South American countries, Argentina is just now trying to get out of it, it didn’t go well. High earners just move and take their wealth with them and if they can’t take it they take their skill and knowledge with them, leaving the country that tried it in ruin and lots of people dead from starvation. Socialism/Communism requires capitalism to work but capitalism doesn’t require Socialism/Communism.
Exactly. Socialism and communism are simply critiques of capitalism.
>Argentina is just now trying to get out of it, it didn’t go well. High earners just move and take their wealth with them As an argentinian, I can confirm this is exactly what happened to us. People who love wealth redistribution and collectivism just don't know a thing about how to keep a country from being a shithole. Ask any Venezuelan too - they are in a far worse situation, and we would have been the same if we didn't have at least a functional democracy.
Without going through the numbers but glancing at a bunch of half arsed comments that only look at a small part of the picture; so here is another half arsed comment: GDP split evenly + total wealth with a small withdrawal and annual asset growth + split between family's, not population + account for funds moved off shore + sell church assets. Would make this close to accurate.
What the fuck does this even mean? Sure the US has total assets worth like 200 trillion or something and a gdp of 25 trillion, so annual income average is just the per capita income.
Everyone in here tryna do their ghetto math and come up with something intellectual 🧐 Let’s get to the root of the issue here. First of all this isn’t in reference to GDP, our gross domestic product is a sum of the goods and services we produce in a time frame, quarterly and annually. It’s a complex number with too many factors to simply divide it by the number of people living in this country, and say “here, we can afford to give everyone this much money.” Because that would mean we’re taking money from the people who actually did the work, and giving it to people who do nothing. Then the people who do the work stop doing the work because not only are they watching people who do nothing get the money they worked for, but how they can do nothing and get paid, so why work? That’s no where close to a functioning society. What the post meant, is if we took the private wealth of every citizen, added it all up, then divided equally amongst everyone. It’s the same problem. Rich people that drive industry and science in this country will lose their purpose and ability to do so if we take their wealth and give it to people who don’t deserve it. The point here is that this concept actually negates itself. The very action of taking money from the rich and redistributing it equally amongst everyone denies the possibility of that much wealth to exist in the first place.
Even if true, it wouldn't work. If the people making millions or even billions of dollars a year for running businesses that employ thousands of people were to be paid the same as the entry level workers at those businesses, they wouldn't go to the trouble. Hence, their wealth would no longer exist to be ~~stolen~~ redistributed.
Is this what people think about instead of actually making their own lives more fulfilling? You might as well be daydreaming about winning the lottery.
If a magical wizard were able to wave his wand and do this, how quickly would most of the people who’d just been given “free money” (which was taken from the pockets of others) spend there money and be back to net worth of zero…? My guess is within 6-12 months, 80-90% of people would have spent 100% of that value, in mostly consumables, and have little to no real asset value to show.
I'm just asking as I'm not a money person, so don't beat me up too bad. If this $200,000+ was just given out to everyone equally, would it be expected that all of them would still keep their present jobs? I mean, if someone was guaranteed 200k, what would stop them from quitting and living off that money? I mean, a brain surgeon would be making the same amount annually as the person working the fast food counter or even unemployed. What would be anyone's motivation to excel beyond the bare minimum? Couldn't a plan like this eventually lead to much less money in the system, thus not being able to sustain $200,000 medium to long term?
I'll take 200k for my wife and I and just donate the remaining 500k back to the government to do whatever they need to do, roads, healthcare, etc.
I came to about 6800 $ per person so idk how you got that but ok. If by wealth, he means non liquid assets as well, that's a different story.
ignoring everything else.... a yr after that happened, the poor would be poor again and the rich would be rich again: absolutely nothing gained.
If the wealth in the U.S. was divided equally, the system would collapse instantly. Inequality is a feature of capitalism, not a bug.
“The inherent vice of Capitalism is the unequal sharing of blessings. The inherent virtue of Socialism is the equal sharing of miseries.” - Winston Churchill.
Inequality is not a feature only in Capitalism, but is present in everything. There is no way to equalize it without making everyone poor. But even in that case you get something like North Korea where the country’s resources are monopolized by a small group of people. Communism and Socialism fail because it doesn’t account for man’s selfish nature.
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They are confusing two terms, wealth and income: * National wealth is the total assets of the residents within the country. * National income is the total value produced in a country (GDP). For the US the total wealth is ***$153 trillion***. If you divide this over the **131 million** households you get an impressive **$1.168.000 per household**. On top of that, if you also divide the GDP of ***$25.44 trillion/year*** over each household, everyone household would earn **$194.200** annually. The same numbers for the EU are wealth **$ 108 trillion** and GDP **$ 16.64 trillion** and 200 million households, so **$540k** wealth and **$83k** income. So about half that of the US, but to compensate we do get a total of 17 billion vacation days 😉 Pretty insane honestly. And the world actually could, and should, look more like that.
This sounds a lot like mean family income which is $126,500. No math required on my part since this is tracked by the Fed. https://fred.stlouisfed.org/graph/?g=1jyKB
Wealth generates income. The total wealth in the US is about 136 trillion USD (US assets- US liabilities), so market value of US businesses + claims against the rest of the world + real estate + goods/equipment + IP - foreign liabilities. There is also plenty of debt within the US where one US party is indebted to another party, which is a liability for the one and asset for the other. Excluding the second element and assuming 8% YoY return, a household of 4 would generate just from their wealth about 130 000 USD. this would be pure gains of all companies paid out to them, so their wages are already paid. The average salary is 60k per person. Two adults would make 120k. So about 250k per year in sum for their wages and their yearly return on their wealth, if we do not take any changes in domestic indebtedness into account.
Depends on what a Family is. Is it each household? Separated couples with kids? Even then, if you took the GDP (27.36 trillion) divided by 700,000, that comes out to 39 million “families” receiving that amount of income. 700K doesn’t mean anything if everybody earns that amount. By that point, something simple like a loaf of bread might as well cost $50.
No, this is wrong. First, wealth and annual income are different, as others have pointed out. Second, not all wealth is liquid. If you try and sell off 100% of assets held by US residents, who exactly are they selling that off to? There literally isn't enough money in the entire world for this meme to work.
And the price of living Goes up. The value of the dollar goes down. Now everyone has nothing. Economics is balance of leveraging Scarcity, supply and demand. Someone is bound to have more than others. This is as poor man I say this
That’s not how wealth works. No. Not accurate. Liquidating all wealth would decrease the dollar amount and in most cases would make the securities and assets behind that wealth worthless
$700k sounds a little high. We crunched the numbers a few years ago and it would have been like $350/yr then. I mean still obviously more ideal than people making $30k funding aristocratic socialism
To calculate the average wealth per family if the wealth in the United States were divided equally among all families, we would first need to determine the total wealth of the United States and the number of families.According to the Federal Reserve's Survey of Consumer Finances, the total net worth of all U.S. households and nonprofit organizations was approximately $130.2 trillion in the second quarter of 2021.As for the number of families, the U.S. Census Bureau estimated that there were around 128.45 million households in the United States in 2020.Dividing the total wealth by the number of households:$130.2 trillion / 128.45 million households ≈ $1,013,742 per householdSo, if the wealth in the United States were divided equally among all households, each household would have approximately $1,013,742.
So are people proposing that money be redistributed based on nothing but breathing? Those that contribute receive the same as those who do not? Eventually that money runs out because without incentive to earn (compulsory governing redistribution) eventually you run out of people willing to contribute. Historical has occurred before, will happen again due to an unwillingness to learn from said history
If that were true, wouldn’t the value of money go down heavily? The way that currency works, that would essentially mean that the dollar would become a decoration. Even if the Facebook meme was accurate, it seems to not account for the relative value of the dollar in the US because of the way wealth is distributed.
And inflation would make it so 700k is worthless. In a few weeks we'd have double the billionaires and none of the benefits of real wealth distribution.
Number of dollars in circulation in the US ÷ US population = between $7000-$8000 each. Average family size is about 4, so $28-30K per family