Let's Do Math! Feat. Herman Cain.

Hello ATS. This is my first time creating a thread, so I hope I get it right!

Herman Cain recently made some rather startling comments, at least to my mind. He said, and I quote "Don't blame Wall Street. Don't blame the big banks. If you don't have a job and you're not rich, blame yourself."

So I got to thinking. Just what does it mean to be "rich" in America, and what if everybody was indeed rich, as Mr. Cain suggests is somehow possible in our current society. Is it possible? Is it desirable? And most importantly, does the math add up?

Now, I'm terrible at math, so I am going to rely on my fellow members to point out any flaws in my logic, but I am going to go ahead and give it the old college try to resolve some of these questions. First off, let us consider what it means to be "rich" in America. According to an article by The Economist to get into the top 5% of wage earners, one must make $150,000 per year or LESS. As the author notes, that is $75,000 per year each in a two income household.

That sounds pretty good, but I'm not sure it qualifies as being really "rich." So for the sake of this argument, and to attempt to define what it means to be "rich" I am hoping we can all agree on a basic definition. I propose we use the old standard of one million dollars, free and clear. If one has that amount of money, I am asserting for the purposes of argument, that one is indeed "rich."

Moving on, one begins to wonder how much money we are talking about here, if everybody was somehow rich. According to the latest numbers from the 2010 Census there are 308,745,538 people in this country. That number is most certainly higher, but that is the official one. So if we do the math, we find that if everybody in the country was "rich" we would need three hundred eight trillion, seven hundred forty five billion, five hundred thirty eight million dollars in circulation for everybody to be able to spend their money, assuming they wanted to use cash.

Which begs the question: how much cash is in circulation? For an answer to that we must visit our good friends at the Federal Reserve Bank of New York and take a peek. As of 2007, they estimate that there is... wait for it... 829 billion dollars in circulation, and "the majority is held outside the United States."

Anybody getting freaked out yet? So if we do the math, as of 2007, there could only be enough actual cash for eight hundred twenty nine thousand "rich" people. As a percentage of the population, that is ... wait for it... 0.268505904691%. Uh oh! There would be no cash AT ALL for the rest of us.

This is rather esoteric, and I am simply trying to show my thought process as I come to a conclusion about Mr. Cain's remarks. You see, it is not possible for everybody to be rich. Mr. Cain of all people should understand what it would mean for inflation if everybody was rich and wanted to use cash for transactions. Can anybody say Zimbabwe? Mr. Cain is blaming the employees at his own pizza company for not being rich. He is blaming the middle class for not being rich, like they are somehow lazy. If we were all CEOs who would work for us? If we were all bankers what would be the point of banking? The abject impossibility and absurdity of his statement becomes apparent if one follows his logic to its ultimate conclusion. I am not proposing any solutions to the problem of disparity of wealth in this nation... but then again, I am not running for President.

I do not wish to pick on Mr. Cain, but he said something stupid and showed his Elitist badge for all to see. I do not have a horse in the race, not even Ron Paul; I think they are all scum. However, I do wish somebody would challenge such ridiculous statements when they are made. So I wish to say right now: it is NOT your fault if you are not rich. The system does not allow everybody to be rich, no matter how hard you work. And a politician is not going to solve any of your problems. I rest my case.

As for Herman Cain... he just got Wounded By Honesty!

I do see your point, and no it's not possible (or dare I say desirable) for "everybody" to be rich.

(I know a few people that definitely don't need any more than buys food, but I digress)

The best year I've had as a self employed contractor I made $35,000

That was a really good year for me.

If I could be guaranteed $50,000+ a year, yeah, that would be awesome.

What's the math look like then?, I'm too lazy..

And not defending Cain either, He can stand or fall by his own merits..

That being said, I kinda like him.

Also everybody talks out their once in awhile.


ETA, is a good first thread..

reply to post by WoundedByHonesty


Quite interesting. You asked a subjective question, "What is rich", answered it with minimal backup and a static point of being in the "top 5%" of income and then attempted to answer it objectively by applying the whole population of the United States to the figures.

Some fatal flaws in my opinion. Without reaching out to the Economist or tax figures that explain what the top 5% percentile of America's make, why don't you answer your own question in your own words? What amount of income/wealth should be deemed "rich"?

I think you were being in honest when attempted to provide some solid numbers and facts to apply to your argument, but in a subjective arena such as this discussion, how do you apply $75,000 to over 300 million people and each saying that is the "rich" benchmark?

What is also to note is the numbers used in the article linked to the Economist are derived from a economics professor from the University of Berkeley, Emmanuel Saez. Given his articles and policy stances and for matter of giving a complete picture, Mr. Saez believes in a progressive tax structure. In interest of my reply, I heavily disagree with progressive tax structures.

You can find the source data used by the Economist (in which the OP linked) HERE. Once there, just go to the heading "Income and Wealth Inequality" and click the first link. We can see that the numbers are from 2008, using IRS published data from 2010.

What I cannot quite figure out is the OP is using the full population of the United States of America and then comparing it to data that is using actual tax data. There is a hefty skewing of numbers here in that regard. Income tax receipts numbers approximately 152,000,000. That is barely a 1/3rd of what the OP was using. Although in fairness, even in this reduction of persons receiving or receiving $75,000 in one shot will still amount to some 11.4 trillion dollars.

What isn't discussed by the OP is the fact that income isn't held in that manner. His larger argument should be against the fiat currency that we are operating and how that our "notes of legal tender" that are backed by the United States economy is the real problem we face.

I know it seems I haven't quite answered anything the OP has stated and that is true. What do you answer someone who signs their posts with "As for Herman Cain... he just got Wounded By Honesty!" when nothing has really been established.

I guess I hope the OP can clarify his argument and maybe even include the whole of the Cain interview so that people can see the whole context of his opening quote utilized in this post....

reply to post by WoundedByHonesty

Ha ha, I like where you're going with this. I believe that Cain's statement was a simple-minded remark directed to elicit a particular sentiment among those who prefer easy-to-understand statements from their politicians. Of course, as your post pointed out, there is no way we can ALL be rich in this current system. It is not designed for that type of equality.

alrighty fact everyone is created equal in this country but that is not a guarantee of equal outcome for every single person living here.

you cant legislate wealth or success they are only obtained from your own actions it is a simple concept

“The Constitution only gives people the right to pursue happiness. You have to catch it yourself.” — Benjamin Franklin

Originally posted by neo96
alrighty fact everyone is created equal in this country but that is not a guarantee of equal outcome for every single person living here.

you cant legislate wealth or success they are only obtained from your own actions it is a simple concept

“The Constitution only gives people the right to pursue happiness. You have to catch it yourself.” — Benjamin Franklin

It's safe to assume Franklin didn't mean fraud and phishing schemes.

reply to post by Americanist


yeah frankin wouldnt approve of social security medicare or medicaid

reply to post by ownbestenemy



The right answer... The top .001% command 12 cents on every fictitious keystroke of a dollar out there. You find no effort behind this particular means of income. It is siphoned off via the financial sector which creates perpetual debt in exchange for investment opportunities. Found within the pyramid scheme of our economy is an automatic and highly effective asset grab. The upper echelon of thieves is continually rewarded for doing... Wait for it...


Jack Squat.

Hello, WoundedByHonesty (although I'm not sure who's being wounded),

I hope you don't mind if I take your points out of order.

May I start with your arithmetic and its associated logic? You point out that there is not enough cash for everybody to be rich. Leaving aside the government's unfortunate habit of printing as much as it wants, allow me to you myself as an example. I have $15 in cash, and another $10 in my change box. But, I have a furnished house, a car, a bunch of personal items, and an extensive line of credit. The amount of cash I have has absolutely no bearing on how rich I am. And as the use of plastic grows, the difference between cash and wealth grows.

Because cash and wealth have no connection, must we keep your definition of rich as well? Can we, just for now, leave "rich" as a vaguer definition? I suppose you don't know what Mr. Cain meant by "rich," and I have no reason to believe you know how his audience took it. Besides, your argument seem to present a million dollars as the annual income required to be rich, not assets. That seems to be setting the bar a little high. Even Obama says the rich are those earning $200,000 to $250,000 a year.

Mr. Cain may very well be using wealth as his measurement of "rich." I think it is more accurate than income. If a multi-millionaire CEO gets laid off, does he become "not rich" as soon as the paychecks stop?

If you'd like, we can get into inflation and who would work in another exchange. I have to go for a while. Allow me to add that you may not be interpreting his remarks correctly. His main thrust was "Don't blame outside forces if you don't have what you want. Go get them yourself." This is a thoroughly American position and has been used, probably, by every politician for a hundred years. If your case is that Mr. Cain is scum and his remark was ridiculous, it seems that you'll have to come up with more evidence before you can rest your case.

As for Herman Cain... he just got Wounded By Honesty!

He won't even need a band-aid for this wound.

Charles1952

Originally posted by neo96
reply to post by Americanist

 

yeah frankin wouldnt approve of social security medicare or medicaid

edit on 8-10-2011 by neo96 because: (no reason given)

Had those been kept away from slush funds or opportunities for private healthcare companies to tag surcharges on procedures, we'd provide a solid system of investment as the final outcome.


So we're full circle... Back to fraud.

He worked for the Federal Reserve Bank in Kanasa City enough said..... NOT what we need

reply to post by ownbestenemy


Holy wow! I did answer my own question by proposing a standard for wealth. If one has one million dollars free and clear, for the sake of argument, I proposed that one was rich. Do you post first and read later or what? I will not bang my head up against a brick wall. Please reread the OP and finish it this time.

reply to post by neo96


um... I don't believe in any legislation for anything, whatsoever. So I'm not sure where you got that from. We are all born equal, huh? Prove it. For instance, some people are smarter than others and use it to manipulate those that they can. Spare me the weak sauce please, and stick to the point... Herman Cain said something really stupid that makes no sense, and is not even possible or desirable (at least if one wants to be rich) so please deal with the substance of the argument.

reply to post by neo96


Last i saw people where not born equal.. I have seen 16 year old kids wreck cars worth more then you would make in a lifetime.

reply to post by charles1952


Much more focused than my coffee induced post from above and what I guess I was trying to draw out of the OP. Basing the title of "rich" on income tax receipts is akin to exactly what President Obama and his economic circles have been attempting to do for the past 3 years (Although such notions are not solely new to Mr. Obama nor will they end if he were to be voted out of office next year.)

Since the numbers used by the OP, coming from an economics professor do not take in account anything other than income, we are deprived of a person's (or family's) truth wealth. What is amazing is if you talk to many of the wealthiest persons they typically have little to no income, but have a mass of wealth through other means such as derivatives, stocks, real assets, etc.

To the OP:
Person A -or- Jake for the sake of this example is a single male in his late 20s. Lets say he has a college degree in a useful field of study and is gainfully employed. I figure, without digging through countless amounts of data that this person can make anywhere from 28-35,000/year. Depending on where this person lives, his lifestyle, assets, savings accounts, CDs, and on and on can you tell me if this person is rich based solely on his income?

reply to post by ownbestenemy


... I'm still sputtering with indignation. You have no clue what I'm even talking about. I rejected the numbers from the article I linked to. Please, please, read what I said. Can you do that for me? Just this once. I am attempting to make a point, and you are hung up on numbers I don't even care about. I found them to be inadequate, and further research simply could not pin down numbers I found reliable, so I proposed a standard for the sake of argument in a reasonable manner. Yikes.

Originally posted by WoundedByHonesty
reply to post by ownbestenemy

 

Holy wow! I did answer my own question by proposing a standard for wealth. If one has one million dollars free and clear, for the sake of argument, I proposed that one was rich. Do you post first and read later or what? I will not bang my head up against a brick wall. Please reread the OP and finish it this time.

I always read first. I could have continued on and question why you felt the need to qualify your entire post by saying you were not a Ron Paul supporter when it has no bearing on the topic you are presenting.

But as another poster already gave a decent and thought out explanation, wealth and income do not equal "rich". You are either mixing the two up or just need to clarify. I am wondering did you even read the post; I do know that ATS posters residing within the hallowed halls of Political Madness have a hard time reading anything beyond three paragraphs, but you did not strike me as that type.

I originally was making that point that it is subjective, even if you propose it. Why would $1 million make you rich? What does "free and clear" mean? Is that $1 million over your lifetime? In a year? What if you are married? Is $2 million now the "rich" benchmark? Should we include assets and the like to compute this "rich" benchmark? If we include assets, do we also include expenditures, debts, obligations, etc?

I am just trying to gain more of your perspective and typically people trying to hash out an idea welcome this...I guess I will see if you are of the typical breed of ATS or if you are a breath of fresh air.

reply to post by ownbestenemy


I am not going to quantify plain English. If you don't know what "free and clear" means, I cannot help you. You don't get it and by "it" I mean anything I am talking about. I tried. You failed. Good day.

Originally posted by ownbestenemy
reply to post by WoundedByHonesty

 

Quite interesting. You asked a subjective question, "What is rich", answered it with minimal backup and a static point of being in the "top 5%" of income and then attempted to answer it objectively by applying the whole population of the United States to the figures.

Some fatal flaws in my opinion. Without reaching out to the Economist or tax figures that explain what the top 5% percentile of America's make, why don't you answer your own question in your own words? What amount of income/wealth should be deemed "rich"?

I think you were being in honest when attempted to provide some solid numbers and facts to apply to your argument, but in a subjective arena such as this discussion, how do you apply $75,000 to over 300 million people and each saying that is the "rich" benchmark?

What is also to note is the numbers used in the article linked to the Economist are derived from a economics professor from the University of Berkeley, Emmanuel Saez. Given his articles and policy stances and for matter of giving a complete picture, Mr. Saez believes in a progressive tax structure. In interest of my reply, I heavily disagree with progressive tax structures.

You can find the source data used by the Economist (in which the OP linked) HERE. Once there, just go to the heading "Income and Wealth Inequality" and click the first link. We can see that the numbers are from 2008, using IRS published data from 2010.

What I cannot quite figure out is the OP is using the full population of the United States of America and then comparing it to data that is using actual tax data. There is a hefty skewing of numbers here in that regard. Income tax receipts numbers approximately 152,000,000. That is barely a 1/3rd of what the OP was using. Although in fairness, even in this reduction of persons receiving or receiving $75,000 in one shot will still amount to some 11.4 trillion dollars.

What isn't discussed by the OP is the fact that income isn't held in that manner. His larger argument should be against the fiat currency that we are operating and how that our "notes of legal tender" that are backed by the United States economy is the real problem we face.

I know it seems I haven't quite answered anything the OP has stated and that is true. What do you answer someone who signs their posts with "As for Herman Cain... he just got Wounded By Honesty!" when nothing has really been established.

I guess I hope the OP can clarify his argument and maybe even include the whole of the Cain interview so that people can see the whole context of his opening quote utilized in this post....

The rediculousness of Herman Cains statement is only surpassed at this attempt to cloud the fact that herman cain doe4s not care about you or anyone who is not rich. The poster above seems to me one of those people who defend politicians, but does not have a clue about reality...Her Man cain could care less about the bloke above convoluting the Op's brilliant outing of Herman Cain.

An infant can understand that the rich have stolen everything in the ast 10 years they could. From Bush's $785 Billion Bailout 2 months before he left, and Obamas $750 Bail Out to the banks to ramp up the ecomnomy and give them a cash injection so they can open up the doors again and start loaning money to people. This crap has not been done.

The rich make a run on the money. Herman Cain will rape this guy as well. My 7 year old understands that herman Cainn is the wolf sent to the sheep who have to vote for the black guy but hates Obama Now. He is just a different type of the same loser.

reply to post by rbnhd76


Thank you for the encouragement. I know a lot of people feel that Herman Cain is the answer for this country. Just remember, a lot of people thought Obama was likeable too, yet were disappointed to find out he was just more of the same. Time will tell, but if this was Vegas and I was placing bets... well you get the idea ^^