The 9.9 Percent Is the New American Aristocracy

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EdithKeeler
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Re: The 9.9 Percent Is the New American Aristocracy

Post by EdithKeeler »

I once used the word "mortified" in a conversation and a dude got mad at me for being uppity. It's not your fault other people are stupid.
I used the word "extant" in a memo at work one time. My (crazy) stupid boss told me to "use words everyone knows." Presumably only one syllable ones.... (Same boss who was furious because I used square bullet points in another memo).

Kriegsspiel
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Kriegsspiel »

7Wannabe5 wrote:
Sat Jul 14, 2018 8:05 pm
Thanks. I consider you gentlemen (and your sarcoplasm) to be "best company" also :)
Funny autocorrect, or 7WB5-humor? You decide.

Riggerjack
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Riggerjack »

Those who prefer to dwell in a world based on crude superstition, foul outlook, degradation of self and environment, and guttural outbursts are free to continue in their practices also, but my standard shall be to avoid such company to the best of my ability.
Wait. I thought you were taking your classes online? What are you doing on campus?

:twisted:

Mister Imperceptible
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Mister Imperceptible »

https://americanaffairsjournal.org/2019 ... class-war/

The socioeconomic divide that will determine the future of poli­tics, particularly in the United States, is not between the top 30 per­cent or 10 percent and the rest, nor even between the 1 percent and the 99 percent. The real class war is between the 0.1 percent and (at most) the 10 percent—or, more precisely, between elites primarily dependent on capital gains and those primarily dependent on profes­sional labor.

The last few years have brought about a new “discovery” of working-class immiseration—a media phenomenon arguably pro­voked by renewed elite anxieties. As a result, the story of a declining working class is now broadly understood. It is, after all, decades old, and it was entirely predictable if not exactly intended. Much less understood, however, is the more recent reshaping and radicalization of the professional managerial class. While the top 5 or 10 percent may not deserve public sympathy, their underperformance relative to the top 0.1 percent will be more politically significant than the hol­lowing out of the working or lower-middle classes. Unlike the work­ing class, the professional managerial class is still capable of, and re­quired for, wielding political power.

At bottom, the economy that has been constructed over the last few decades is nothing more than a capital accumulation economy. As long as returns on capital exceed returns on labor, then the largest capital holders benefit the most, inequality rises, and wealth becomes more and more narrowly concentrated.1 Labor—including elite la­bor—is inevitably left behind. Marxian thinkers have been analyzing these dynamics for almost two centuries, but they have often misread the political effects of these developments, which play out primarily among the elite managerial class, rather than within the binary of capitalists and proletarians.

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Sclass
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Sclass »

Hey, wow thanks for posting this. This is an eye opener.

I feel a little confirmation bias on this piece. My social circle (mostly fellow graduates from my university days) are what I call white collar losers. They are really smart. But they are not rich. And they work and stress hard because that is what they’re born to do. Basically they’re the servants of the owner class.
Mister Imperceptible wrote:
Sun Dec 22, 2019 2:46 pm
As long as returns on capital exceed returns on labor, then the largest capital holders benefit the most, inequality rises, and wealth becomes more and more narrowly concentrated.
What exactly does this mean BTW? How do you compare returns on labor to returns on capital? (Not attacking I just don’t understand the comparison).

ertyu
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Re: The 9.9 Percent Is the New American Aristocracy

Post by ertyu »

white collar loser reporting for duty

Mister Imperceptible
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Mister Imperceptible »

The entire text from my post was an excerpt from early in the article.

I would say if your hard working friends put in 60 hours a week and get their balls busted to pull $100k-$200k a year that’s all fine and nice for them, but if the CEO and the board of directors can issue debt to buy back their stock to increase the value of their stock options by millions or billions of dollars while destroying the balance sheet of the company, we get to where we are with wealth inequalities as severe as they were in 1929.

From the article:

Discussions of stagnant wage growth for nonmanagerial workers since the 1970s have become commonplace over the last few years, along with the story of hardening socioeconomic divides. “The 9.9 percent is the new American aristocracy,” as one Atlantic headline put it. Yet what is happening within the 9.9 percent has received little scrutiny. In fact, the fortunes of the members of this new “aristocra­cy” have diverged considerably. The performance gap between the top 1 or 0.1 percent versus the top 10 percent is actually larger than the gap between those right at 10 percent and any part of the bottom 90 percent.

Seppia wrote:
Fri Dec 06, 2019 1:29 pm
Is it high? yes. But why "artificially"?
It's supply and demand.
I don't believe that "it's the FED!"
It’s the Fed.

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Sclass
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Sclass »

ertyu wrote:
Sun Dec 22, 2019 9:27 pm
white collar loser reporting for duty
Yeah this article struck a nerve. We work so hard to climb to the top of the heap and it gets you a place in the robot army. Paid biweekly not quarterly. Big difference there. Ownership versus being owned.

My friends are top of the meritocracy. They did well in K-12, then went to top universities and then obtained graduate, law and medical degrees. Worked their asses off to be “the best of he best of the very best-sir!” Some make household incomes of $500,000 but that is chump change in my old Bay Area suburb. Congratulations you can now afford the monthly payments on a $3,000,000 home on a postage stamp of land. After life choices like private kids schools, vacations, mandatory spa treatments and counseling, they cannot save much. They’re stressed to the eyeballs and it’s work work work all the time.

A wealth manager in my town said there actually wasn’t all that much wealth to manage among most of the residents. The owners took their money to the investment banks. He was left with the managerial class which shockingly had little in investable assets. He broke it down for me between their homes and lifestyles and they basically were unable to save much aside from their home equity.

These were the top grads from the top schools occupying middle management positions in Silicon Valley. They’d worked really hard to get a seat there but somehow it wasn’t all that great for them. I opted out of this path pretty early and refused to follow.

I guess worse off are the academics mentioned in the article. They work really hard and the best get paid very little. What’s with the shot about academics vs. Trump voters in there? Is this some kind of right wing publication?

Toska2
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Toska2 »

Labor is paid linearly $/hr. That's with people rushing in to expand the labor pool, outsourcing and automation driving down wages. Citizens can't (won't?) move easily between countries to chase jobs.

Returns on capital are exponential. We know it as runaway growth.

I can't help to note GE developed giant wind turbines then pushed for giant tax breaks on them. Thier size allowed them to create a product THEN a need. In a sense they created a short monopoly because they also had the only product.
Warren Buffett was able to slow down the oil pipelines and profit from the oil rail freight. Mike Ilitch owned buildings he purposely blighted to drive down property values so he could build his stadium cheaper. This was in direct violation of city laws. Not even a slap on the wrist....

If we are playing the same game they have a pencil to change the rules at whim.

ertyu
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Re: The 9.9 Percent Is the New American Aristocracy

Post by ertyu »

What makes the situation of the people you mentioned even harder is that it's obvious to an outsider the equity in their houses is temporary, too. another 10-15 years, fortunes might change just like they changed for detroit and the rust belt, and then what?

but yes, stress to the eyeballs and work all the time, check. my salary isn't 250k but i still spend more than i should and have less savings than i could. I think it's not a coincidence the FIRE/ERE movements are picking up; the meritocracy's basic premise is that they'll work the life out of you in your 20s and 30s and then let you off to pasture. The smart ones treat it like what it is: a career with an earnings pattern like that of a rockstar or a football player: you've got very few very high-earning years in you, and that's that. The smartest thing you can do is save, the worst thing - to sink it into a multimillion-dollar "estate"

Mister Imperceptible
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Mister Imperceptible »

Burning Daylight Part 2 Chapter 5

All the traffic can bear

Seppia
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Seppia »

Mister Imperceptible wrote:
Sun Dec 22, 2019 9:27 pm
It’s the Fed.
If that’s the only cause, someone has yet to explain me why valuations haven’t skyrocketed in Europe and Japan, where QE was done much more aggressively (and for much longer in the case of our asian friends)

ertyu
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Re: The 9.9 Percent Is the New American Aristocracy

Post by ertyu »

I explained Seppia but you ignored what I was saying and kept with your stuff. Carry trades. Valuations haven't sky-rocketed in Europe and Japan because the US has higher yields. Thus carry trades. All the EU/JP QE money's going into US instruments that yield more.

oldbeyond
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Re: The 9.9 Percent Is the New American Aristocracy

Post by oldbeyond »

Thanks for the link MI, that was a great read. Note that the original article in The Atlantic surgically excluded the 0.1% and then went after the rest of the 10% - the author obviously grasped the real power structures in his gut, if not perhaps consciously. It’s not that all the talk of privilege and the like is completely unfounded, but largely it is used as a distraction, and the parroting of such talking points is mostly a signal of adherence to elite values. The large pool of willing sycophants in the elite precariat enables the enfeeblement of the real holders of power, and you get absurdities like the Stordalens taking a quick break from their planet-wrecking jetsetting to lecture the plebs about the evils of their meat eating ways. To me such displays of a lack of street smarts are quite telling.

I don’t think anything will happen as long as the game is judged by values. Entrenched capital owners will always win that game, by happily recruiting the professionals to formulate and package values suitable for the current elite. For anything to change the discussion has to happen on the level of interests. That would clarify priorities, and it would make alliances possible. The current values paradigm ends up in culture war, a classic divide and conquer move. The HBTQ cosmopolitan would never extend a hand to the evangelical nativist, but that doesn’t mean that a junior Silicon Valley developer has no common interests with a midlife factory supervisor in the South. But focusing all our attention on values, and it’s descent in to ensuring purity of thought, helps us forget that.

Not that there’s no place for values in politics, it’s more a question of where and to what extent.

7Wannabe5
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Re: The 9.9 Percent Is the New American Aristocracy

Post by 7Wannabe5 »

The return on financial assets has averaged 6.3% since 1983 while returns on real estate have only averaged .6%. Also, it is an inherent flaw of the capitalistic system that inequity will necessarily rise with overall wealth in the system. It has also been suggested that current returns to entrepreneurship are bloated due to monopolies. I can barely remember the last time a big monopoly was busted. In fact, conversely, "too big to fail' has been the de facto policy for at least the last 30 years.

Unlike most of the living entities in mature, capital locked, forest systems, human beings can make their own lightning when the under story becomes too shady. But, I'm still 50/50 on whether times are soon to become more "interesting."

Seppia
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Re: The 9.9 Percent Is the New American Aristocracy

Post by Seppia »

@ertyu
I'll respond in the appropriate thread

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