How The Rich Stay Rich

An interesting piece over at Mother Jones from last May listing a number of statistics about money that make you pause and think. It’s certainly worth a visit to read them all (over forty), but here are a few that caught my eye:

  • Oscar performers and presenters collectively owe the IRS $1,250,000 on the gift bags they got at the 2006 Academy Awards ceremony.
  • United has cut the pensions and salaries of most employees but promised 400 top executives 8% of the shares it expects to issue upon emerging from bankruptcy (United’s top 8 execs will also get a bonus of between 55% and 100% of their salaries).
  • The 5th leading philanthropist last year was Boone Pickens, in part due to his $165 million gift to Oklahoma State University’s golf program (within an hour, OSU invested it in a hedge fund Pickens controls. Thanks to a Katrina relief provision, his “gift” was also 100% deductible).
  • Public companies spend 10% of their earnings compensating their top 5 executives.
  • Only the wealthiest 20% of Americans spend more on entertainment than on health care.
  • If the $5.15 hourly minimum wage had risen at the same rate as CEO compensation since 1990, it would now stand at $23.03.
  • Bush’s tax cuts give a 2-child family earning $1 million an extra $86,722–or Harvard tuition, room, board, and an iMac G5 for both kids (A 2-child family earning $50,000 gets $2,050–or 1/5 the cost of public college for one kid).
  • And on the other end:

  • Poor Americans spend 1/4 of their income on residential energy costs.

    You can check out all the sources for the article here

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    6 Responses to How The Rich Stay Rich

    1. reallykool says:

      yes this is injustice in the world.

      but the great thing about this country is that anyone can become wealthy through business or investments. [and even the lottery, although thats fleeting].

    2. Jeff says:

      funny how some of the wealthiest families in the united states were dirt poor farmers that got land for free or extremely cheap from the government when the country was being founded.

    3. Sam says:

      It has NEVER BEEN EASIER for a person with nothing to become rich than it is in America today. I think some people need to spend effort on their envy and more effort on succeeding.

    4. Nancy says:

      The $2,050. that the family making $50,000 a year is $2.050.00 than they had before!
      Look at what YOU get not what others get.
      The millionaire PAYS a LOT more in taxes, too.
      Those earning $40,000 a year, with a family of four don’t pay any taxs, with the Bush tax cuts.
      I totally agree with Sam!
      Quit whining, and and work to build wealth.
      PS, I am about as far removed from being wealthy as I can be!

    5. Chris says:

      Who cares if we can potentially strike it rich in our current system? The fact is the vast majority of us will not. The notion of class mobility is incredibly overblown. Yes, there are some that move from working class to lower middle class, or lower middle class to upper middle class, and there are even some Horatio Alger stories out there. For most part however, where you begin in life is a good indication of where you will end up. For most of us, striking it rich from investing and/or owning a business is as much of a pipe dream as winning the lottery. It could happen to you, but it is highly improbable. So are we supposed to praise our current system because it gives us an infinitesimally small chance at becoming the next Bill Gates? It seems to come down to possibilities vs. reality. Our current system gives us an insanely minute chance of going from rags to riches, but in reality most of us never will. It is also true that many people suffer from the inherent injustices of our current system. That is a reality that we can see and feel. I understand that people should focus on their own financial house. I wholeheartedly agree that people should think more about how to wisely manage their own money rather than incessantly thinking about how their neighbors spend theirs. But if we only focus on the tree in front of us, we miss the forest. It is easy enough for those that have enough to make ends meet to ignore the problems with our current system. The same cannot be said for those that don’t. When an elderly person that worked his whole life has to choose between buying medicine and buying food, he can’t ignore the injustice. The thing that people don’t seem to realize is that most of us are walking on a razors edge. All it takes is one accident, one injury, or an unexpected illness or lay off to completely wreck our best laid plans. People don’t point out the inequalities within our current economic system because they are envious; they do so to show how ridiculously unfair things are. It is not about envy, it is about decency. Those who laud our recent tax cuts seem to forget that these cuts have costs. Like the reduction in the amount of student loan programs for low income students, the lack of adequate equipment for our troops (sons and daughters of the working and middle class) and the enormous federal debt that someone will eventually have to pay off.

    6. Susan says:

      Start with the wealth of good health and anything is possible.

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