Some completely crazy claims flying around Twitter about how much money it takes to live decently in America.
First there was the $140,000/year is the real poverty line nonsense, launched by Mike Green based on some dubious arithmetic. Noah Smith has a bunch of similar claims at the link.
But it only gets worse from there. Goldman Sachs recently said that 40% of those making $300,000 a year are living paycheck to paycheck. Which inspired this insane tweet:
A lot of people don't understand this, but it's 100% true, depending on where you live.
From 300k to 1mm, the precarity is the same as being poor - paycheck to paycheck. It's just that the numbers are bigger.
- Most people in the aspirational class live in more expensive cities where the hobbies are costlier. Rich people in Texas enjoy backyard barbecues and drive F150s, but in Greenwich, you need a Range Rover, and in Hong Kong, you need bottle service every Friday just to fit in.
- It's expensive having rich friends. Nothing is worse than seeing a billionaire grab the wine list at dinner, because they never expect to pay the tab.
- If you're in the aspirational class, and trying to keep up, when someone invites you to their house in the Hamptons or on their plane, you have to reciprocate.
- You always think that next year's bonus will be bigger. So it'll be easier to save $10 in the future than it is to worry about $1 today.
The lesson is this: if your "aspirations" require you to spend every penny your earn, you will always feel financially stressed no matter how big your salary.
Aspirational spending isn't limited to the rich; it's why many poor people buy name brand products (detergent, soap, cereal) rather than the store brand, and why many Americans of all classes drive cars they can't afford.
If you don't want to feel stressed about money, live within your means.
3 comments:
Aspirational spending isn't limited to the rich; it's why many poor people buy name brand products (detergent, soap, cereal) rather than the store brand, and why many Americans of all classes drive cars they can't afford.
When was the last time you ate store brand cereal, John? And from which store? If you go to an upscale grocery store already, I'm sure the store brand is quite good. But try eating store brand from Walmart or similar, and then tell me you'd be willing to eat that every day for a year.
Poor people are particularly prone toward palliative spending. They come home from work exhausted, aching, stressed out, with a million things on their mind and not enough time for any of them. Then they sleep badly on discount mattresses, and then they wake up facing the prospect of yet another day doing it all again. And it's at moments like that, when you're trying to muster the will to go endure through another shitty day, that people REALLY just want basic creature comforts - like cereal that isn't bland and stale, because unless you shop at an upscale grocery store to begin with, most store brand food is genuinely terrible, and often literally repackaged factory rejects that failed quality control tests for the name brand products.
You can preach self control and prudence all you like, but the fact is that our society actively encourages people to be miserable, precisely BECAUSE companies know they can exploit that to get people to make impulse purchases for fleeting comfort in their stressed out lives.
Who do you think your message of prudence is going to reach? And what effect do you think it is going to have, in the face of trillions of dollars po mass corporate marketing which is designed from the ground up to manipulate people into making the very choices you admonish them for indulging in?
We turn a blind eye as people are forced to spend their days constantly being bombarded by advertisements telling them to act in ways that are unhealthy, both for individuals and for society. But then we turn around and wonder aloud, "Why are so many people making such unhealthy decisions?". It's because we actively incentivize it! It's because the rich have figured out how to manipulate and control people for absurd profits!
Bill Watterson, author of the comic Calvin and Hobbes, had a prescient strip where he very neatly spelled out the issue - all the way back on March 20th, 1994.
"...why do I get the feeling society is trying to make us discontented with everything we do insecure about who we are?"
"I suppose if people thought about real issues and needs instead of manufactured desires, the economy would collapse and we'd have total anarchy."
The "aspirational spending" you rail against is the product of an economy which is predatory, and which spends vast oceans of money on researching better tricks for psychologically manipulating people into thinking and behaving in unhealthy ways, in order to profit the investors and the rich.
If you want to fix the problem, there's only one way - eliminate the predation.
typo: "...why do I get the feeling society is trying to make us discontented with everything we do and insecure about who we are?"
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