The top 10% of earners—households making about $250,000 a year or more—are splurging on everything from vacations to designer handbags, buoyed by big gains in stocks, real estate and other assets.
Those consumers now account for 49.7% of all spending, a record in data going back to 1989, according to an analysis by Moody’s Analytics. Three decades ago, they accounted for about 36%.
The top-level post uses a gift link. When it runs out, there is an archived copy of the article.
Maybe the economy would being doing better if 90% of people had money for basic needs and maybe a little left over afterwards for shit like I dunno, cars, hobbies, charity, advocacy and events.
Remember, not that long ago, a single working man could provide for a house, 2 cars, a wife and 2.5 kids.
Nowadays, it takes DINKs deep into their careers to afford a starter home.
not that long ago, a single working man could provide for a house, 2 cars, a wife and 2.5 kids.
While women worked for pennies on the dollar, people of color weren’t allowed to go to school with white people and women didn’t go to college, they went to secretarial school. Plus tons of people were dying from all manner of health conditions because there were no regulations for practically anything.
The “golden days” have some serious nostalgia but they were far more fucked up than people remember. Buying a home from 0 has always been like living in poverty for almost everybody in the US. Only the top earners have ever had vast excess of earnings.
When houses were 35k people were making $3500/year or much, much less.
Go far enough back and yes the negative things were absolutely true for non-white men. However houses used to cost a much smaller portion of a median earners income and this was true after we started to turn things around for women and minorities.
Let’s try 1980 not exactly the dark ages. Median income was $9400 and the median home was 55k. 5.8 years of wages. Someone could actually save up for and potentially actually buy perhaps not a median but a starter home right out. for 3 years of wages.
Median home is now 419k median income is 50k. This is now 8.2 years of wages. You will have to get a mortgage and in fact pay around 22 years of the median wage to pay the bank interest. Worse medical care, college, and rent have also skyrocketed so you may not be able to get up enough to even do that if you haven’t already bought in leaving you paying even more to your landlord.
https://dqydj.com/individual-income-by-year/ https://dqydj.com/historical-home-prices/
Maybe we should stop measuring the state of economy using the metrics rich people invented to convince everyone it was a good thing for them to get richer in the first place…
Seriously, “Rich people spend more money” Well no shit… They have the money to spend. The broke population doesn’t have shit to spend
The economy doesn’t depend on rich people. If there were no billionaires, the economy would tick along just as it does now.
A friendly reminder that articles like this serve to create infighting among the worker class.
Someone earning $250,000 is definitely rich, but they’re nowhere even close to the level of rich that makes wealth distribution problematic. And they’re probably working for that income.
Check out Wealth Shown to Scale (Archive link here because apparently the page is down).
Everyone who isn’t a billionaire ought to be on the same side: against billionaires. But the WSJ publishes stuff like this to make you direct your ire at doctors and lawyers instead of at the people leeching from society.
They also intentionally frame a really bad thing as a “good” thing. The situation here is not that the “rich” run the economy - it’s that everyone else is being priced out of the economy by wage stagnation and rising costs of living.
The alternate headline here is “wealth inequality surges, 90% of Americans now account for only 50% of consumer spending”
Or
“1 in 10 Americans spending as much as the other 9 combined, while 3 of them live paycheck to paycheck”
People earning 6 digits a year are still one bad accident or diagnosis away from losing their jobs and living in poverty. They’re not the root problem or the solution to the economy, and this article is trying to paint them as both.
Instead we need to acknowledge that the people “earning” 8-10 digits per year are extracting and hoarding that money away from the 90% of Americans who would otherwise be spending it in ways that would actually improve the economy.
People making 250k are largely on the side of the billionaires. They are reliable votes for the interests of the rich.
Because they are falling for the same propaganda, but on the other side of the coin. Don’t waste your time vilifying them for falling for the same line we all do. It serves no purpose except to make you angry.
Someone earning $250,000 is definitely rich
Having earned that for several years (though not any longer), in the SF bay area where I lived, that was the lower end of the upper middle class. I’ve since retired, and have subsequently taken on a post-retirement job in public service, so my earnings aren’t that high any more.
to make you direct your ire at doctors and lawyers instead of at the people leeching from society
I’d categorize lipo specialists, many cosmetic surgeons and most non-criminal lawyers among the leeches, though your point holds. I’d add that there’s a distinction between those doing real jobs and those pursuing the discretionary spending of the very rich. Sorry, yachtmakers, private-jet leasers, coke dealers and high-end escort agencies, you’ll have to learn to do something else.
To expand further on what you’re saying, the problem with the linked article’s mathematical/statistical analysis is that it uses a slightly more sophisticated version of misleadingly using “average”/mean in a context where median would be more appropriate.
Specifically, they talk about the spending of the top 10% in the aggregate, and point to the threshold of when a household tips into that top decile. Well, that aggregated number is itself heavily skewed towards the higher end of that spectrum, where the people in the 99th percentile are contributing a lot more weight than those in the 90th.
Here are the cutoffs for income thresholds to hit each percentile at or above 90:
90: $235k
91: $246k
92: $260k
93: $275k
94: $295k
95: $316k
96: $348k
97: $391k
98: $461k
99: $632kNote that this doesn’t even get into the 0.5% or 0.1%, which skew things even further. Even without that level of granularity, you can see that the median in this group is about $305k while the mean is closer to $350k.
When you include the billionaires, the difference skews even further.
That’s the math error at the center of this thesis. The facts reported might be true, but in a way that groups things together misleadingly.
yup. I will admit though that as you get higher a larger percentage of folks think they are rich and support the wrong side. Had so many docotors complain about taxes and talk conservative politics wise and im like dudes you are just over the top tax bracket. the problem is there should be more brackets that go higher not that the top should be decreased. Heck your bracket can’t be decreased till its not the top one.
Yep. They’re getting the same propaganda and falling for it too. The entire idea of the “middle class” is to get workers with something to think workers with nothing are the enemy, and get them to ignore the leeches with nearly everything.
still amazes me that the brackets end in the low six figure territory when we have billionaires. I remember a supposed quote from the head of the irs back in ww2 times about how his job was to figure out elvises taxes. Like because he was the highest paid guy. Man to have rich folks proud to pay taxes as a patriotic duty. Those were the days.
Feels like a symptom of the same disease, When the ultra wealthy don’t pay taxes and even effectively get negative taxes in the form of massive refunds and bailouts how could anyone else possibly feel proud about paying taxes in such a system. I didn’t even make enough to pay tax this past fiscal year but if I had I’d be hard pressed to be proud about it when I know how much of the money is going into the pockets of political cronies rather than actually bettering the country I live in.
Reminded me of this doublespeak class warfare article from November: Rich people are dominating holiday travel - Most hotel guests this season will be people making six-figure incomes, analysts say.
Households earning at least six figures a year are expected to make up the largest share of holiday travelers this season — 45%, up from 38% in 2023, according to a recent survey by the consulting firm Deloitte. And they’re on track to make up a majority of paid lodging customers, expanding their ranks as hotel guests from 43% last season to 52% now.
“Travelers are looking to invest in upgrades and experiences that will make the holiday memorable,” said Kate Ferrara, vice chair for U.S. transportation, hospitality and services at Deloitte.
This was an example of pure psychological warfare to get people to spend more money at hotels. “Well, those ‘rich’ $100k earners are upgrading their stay, I will to!”
Corpo “news” is such shit.
In many areas of the US, this just means both parents work and have solidly middle-class (but by no means extravagant) incomes. My wife and I both work and we can cover the mortgage, all the expenses related to our kid, home ownership expenses, modest savings, etc. We are certainly not buying luxury cars or Gucci bags. Our big spends involve housing, healthcare costs, food costs.
I’m not sure who these people are who are affording discretionary purchases of hobby related stuff and luxury goods. That’s probably more like the 1-2%. Either that or people are amassing debt so they can look the part and “keep up with the Joneses”.
The highest earning 10% also have about 67% of the wealth, so they are actually underperforming compared to the rest of the population. It’s just that they have all the money.
Their underperformance is a higher savings/investing rate that leads to a greater wealth disparity long term. This is why redistribution (through taxes or other means) is so importantly to balance the scales.
But as other commenter’s have pointed out, my target would be billionaires not doctors and lawyers.
Just passing a bunch of money around at the top.
What’s funny is, I guarantee all of these people will say without flinching, “I need more money.”
they are actually underperforming compared to the rest of the population
They always do, which is a big part of why the “FairTax[sic]” is such a scam.
And by “always,” I mean literally without exception, because the difference between the working class and owner class is defined by it.
Thanks for the number, do you have a link where you got it from? I suspected something like this might be the case, but I couldn’t find a source easily online.
Here: https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/table/
I switched the table to Shares (%) and added up the latest values of the first 3 columns.
They’re literally trying to build an economy that starves regular people out of it. They don’t care anymore, they want it all.
A whole ass country full of fucking Veruca Salts.
Well, there’s 2 Verucas running the white House right now. I’m sure they care about fixing this issue.
What an insidious way to frame poverty and wealth disparity.
I cannot remember a time a headline filled me with such hatred and anger toward a person.
I hope Ms. Ensign gets exactly what she deserves.
Her WSJ biography REEKS of boot licking and discredited economic theory:
I can’t tell if this is from WSJ or Jacobin
Regular people hoping to become millionaires and billionaires
Ah yes the temporarily embarrased millionaires.
It’s fitting imo, because they’ve stolen the wealth and think that Luigi’s case is just a freak accident rather than the upcoming Bell Riots.
On a side note, I always figured the Bell Riots that were supposed to be back in September of our timeline were just a hair delayed and slightly miscalculated.
Maybe records became fuzzy due to the whole WWIII issue.
Good call
That’s because they’ve seized all the money.
More significantly, a tiny chunk of them have seized the bulk of the money and other assets. The 90th percentile worker sees the insecurity that they’ll experience with a job loss. Somebody in the top 0.1% is likely a rentier who can live off the rest of us and not care.
Maybe if you didn’t fucking rob the other 90%, the numbers would be different.
$250K isn’t that outrageous of a household income (or at least it shouldn’t be); literally two good white collar jobs would reach that point in the coastal cities.
The bigger thing at issue is to not frame it as 90% vs 10%, it’s literally 99% vs 1% — if not 99.9% vs. 0.1% if we are really talking about the ‘disconnected from reality wealthy’.
That’s the line that the wealthiest amongst us are trying to draw, in order to build class disunity. A white-collar household pulling in $250K has a lot more in common with a blue-collar household pulling in $65K, than they do the oligarchy above them.
Yeah, $250k in an average to high cost of living area is middle class comfortable. Not rich.
Calling that income rich is a tactic to get the middle class to identify with the billionaires and support regressive policies.
As someone who has lived both experiences, you are absolutely correct.
Exactly. They seem to be concluding that only the wealthy can bear the burden of spending money for the rest of us?
It’s not really robbing when the useful idiots are proud to give up their wealth and power.
Look at all the dumb shit people subscribe to that they could be getting for free. Look at all the dumb shit they waste their money on (like doordash) while complaining they need more.
It’s a cultural problem, and the average worker is proud to be a part of it.
Whenever you suggest they could be doing something differently, like using free streaming sites instead of netflix, they will look at you like you’re worse than a pedophile because you dared to suggest they’re wasting money.
The average worker has no choice but to funnel their money up the wealth chain through rent and mortgages. That’s the bulk of it.
Wrong. We can all choose to live and appreciate more modest lives.
I haven’t eaten at a restaurant or bought a video game in years, for example. If more people appreciated what they have instead of always wanting more, these problems would be solved overnight.
through rent and mortgages.
The housing market is complete bullshit, but workers also have themselves to blame for accepting renting as normal. We need to discourage renting and encourage ownership. Unfortunately, in order to do that people need to be willing to live more modest lifestyles outside of major cities. Supply and demand doesn’t go away just because we want it to.
Its not the workers who are to blame. Its the folks who aspires to live on “passive income” who used housing as a vehicle to steal wealth from the younger generations. I finished high school during the GFC and everything about the housing market has been fucked since then.
Its not the workers who are to blame.
No, workers absolutely bear some of the blame. They choose to go along with consumerism and attack anyone who goes against it.
Mate, I have an electrical engineering degree and work for a big chip design company. Wages have stagnated to the point where I can never afford afford to buy a house, and rent eats nearly half my wages. I live a modest life and the only time I travelled was when I was working full time in Europe. Never been on a holiday. There’s literally nothing I could have done to fix that except find a squat to live, or put up with share houses into my thirties. No family I can live with. Its out of many peoples control. The house I rent is valued at 1.2 million in Melbourne. It was 370k 15 years ago.
where I can never afford afford to buy a house
A house where? In a suburb for $250,000+? You know you can buy houses for <$100k, right? Some people’s cars cost more than my house, but I don’t need more.
The house I rent is valued at 1.2 million in Melbourne.
Yeah, you’re part of the problem. You need to be willing a more modest lifestyle. Ask yourself this, if you need more, how do others survive with significantly less? They probably don’t live in major cities, for one. If you think you’re entitled to live in a major city, then you’re part of the problem.
You are commenting from an American perspective. There are no houses in Australian capital cities for less than 100k. And there are no job opportunities for many professions outside the capital cities.
Is there any room for ya’ll to spread out and build more?
And there are no job opportunities for many professions outside the capital cities.
That’s not how jobs work, mi amigo. The more people that live in a given area, the more jobs will be available. You might not get paid as much, but to make the argument that there’s no work or that your job can’t be done remotely is false.
Wealthiest nation in the world (by a large margin if I may add), regular people are struggling to get by and your solution is “just be more frugal”? I’d imagine if you’re the wealthiest nation in the world you can afford some luxuries but I guess not according to you. Also, if you’re so wealthy where does all that wealth go?
regular people are struggling to get by and your solution is “just be more frugal”?
Not quite. We need to get off the consumer bandwagon and learn to appreciate what we have.
People are miserable because they’re constantly trying to “keep up with the jones’” which means wasting money on bullshit they don’t need and have been conditioned to want.
Until the working class learns to appreciate different things, we shouldn’t expect anything to change or improve.
I ended up reading your other comments. You’re out of touch with reality and there’s nothing I could say that others haven’t already brought up, and since you’re not listening to them I doubt you’ll listen to me. So the only thing I can add is that you should start practicing what you’re preaching and get off the internet because the internet is a luxury. Then again I imagine you won’t have a problem justifying your own “wasting money on bullshit” because you can afford it.
Yeah, no.
It’s not an “all-or-nothing” thing. That’s what consumers have been convinced to believe so that they don’t feel guilty about contributing to the problem. You’re doing it right now.
“Depends” is the wrong way to frame it.
Essentially, this means we’re serving them.
I keep trying to explain, billionaires aren’t the only issue. Stop looking up to millionaires, too. They’re both ripping us off.
Don’t ever go to bat for them unless you want to be a useful idiot.
That’s only because no one else has spare money to spend.
BECAUSE! They.Stole.all.the.MONEY!
It doesn’t depend on them they’re just THE ONLY ONES WITH FUCKING MONEY. Title almost makes it seem like they’re cucking for rich people. Yeah no shit they’re the main consumers they’re the only ones who can afford to.
Fuck rich people, and fuck you if you like them. I hate rich people so much.
See my other post in here for some context. Someone earning $250,000 a year is probably still working for that income. They’re rich, sure, but they aren’t the problem nor are they your enemy. WSJ publishes stuff like this to keep the working class infighting, like crabs trying to climb out of a bucket.
Someone that makes 250k a year is not rich.
250k a year would be a life-changing amount of money for me.
250k a year would wipe out my partner’s student debt, all our shared CC debt, and pay off a third of my house in a single year, at our current spending rate.
250k/yr is an absolutely loaded amount of money for 90% of the people I know.
I hate to break it to you, but for most Americans, 250K a year is an unthinkable amount of money.
Depends on how you define rich, I suppose. The reason I used that number is that’s what the article is defining as the top 10%.
