Saturday, March 17, 2012

We are the 1%

We are the 1%.

That's the sobering reality check from the excellent book The Haves and the Have-Nots by Branko Milanovic.

As it turns out, there are a whole lot of poor people in the world. And the United States is so very rich. Even the very poorest Americans living in what we consider to be abject poverty (and they are significantly poorer than the average American) is richer than more than two-thirds of the rest of the world.

For upper middle class Americans (defined as those who earn $34,000 a year per person, not per family), we are the 1%. Turns out, that level of income (after-taxes, per person, in dollars, living in the US) happens to be the line above which sits the top 1% richest people in the world.


I had thought I was part of the 99% (and in the US, I am). But in the world, I am part of the 1%.

Bit of a paradigm shift, right?

So just as I believe it is not only a moral imperative but a practical economic strategy to spend more of the income of the top 1% on public assets that benefit all Americans (like education and sewers and high speed trains and police officers and social workers and parks), I have to extend that logic to spend more of my income on public assets that benefit everyone in the world (like education in India and sewers in Cameroon and high speed trains in Brazil and police officers in Juarez, Mexico and social workers in Malasia and parks in Libya) as a moral imperative and as a solid economic development strategy.

Just as charity balls and voluntary private donations from rich Americans doesn't come close to substituting for the moral imperative and economic development strategy of taxing the 1% more to spend it on public assets that benefit all 100% of us, so too voluntary contributions from we wealthy Americans to relatively impoverished others does not cut it. We ought to be taxed. And that money ought to be spent making people wealthier in poor countries.

It's the same logic. They are the 99%. And spending some of our income to make them wealthier – whether all of us like it or not – is the right thing to do.