Thread: Land of the Free, Home of the Poor

Land of the Free, Home of the Poor | PBS NewsHour | Aug. 16, 2011 | PBS


Transcript

JUDY WOODRUFF: Now, the opening chapter of an occasional series about inequality in America. It's a subject that's getting more attention in light of the weak economy and the ongoing debate around budget cuts and raising revenues.

Billionaire businessman and philanthropist Warren Buffett, who has argued in favor of higher taxes on the wealthiest, cited the growing disparity in an interview on PBS last night with Charlie Rose.

WARREN BUFFETT, Berkshire Hathaway: It should be a land of opportunity. And people that get rich. They -- nobody is going to confiscate everything or anything of the sort.

But the distribution in this country -- market system has led to extremes. A guy that is wired like me -- I don't have any special status in this world. I'm not -- a great nurse, a great teacher may be much more valuable to society than I am. I'm wired so that I can figure out what things are worth. So...

WARREN BUFFETT: Yes. So, I get super rich.

And somebody whose adenoids are in a certain arrangement gets rich. But television makes a lot of people rich. I mean, Lou Gehrig held out for $25,000 in the late '30s. You know, they benched him. They didn't bench him, breaking his streak, but he had a long -- he had a long struggle.

Television has made the .230 hitter or the .240 hitter better than Ted Williams at .406.

So, it -- there's a lot of serendipity. We -- everybody in this country owes their good fortune in some way to the rest of the country.

JEFFREY BROWN: NewsHour economics correspondent Paul Solman has been looking into the reality and impact of the wealth gap in the U.S. today.

Here's the first of several stories, part of his ongoing reporting Making Sense of financial news.

PAUL SOLMAN: Near Times Square, at the line for "Late Show" tickets, we borrowed David Letterman's audience for a short quiz on economic inequality.

So, this is three different societies.

MAN: Uh-huh.

PAUL SOLMAN: It's the distribution of wealth in the societies. Where do think these three places are?

In each chart, we explained, yellow represents the richest fifth of the population, blue the second richest, and so on, down to orange, the poorest fifth. Which chart, we asked, represents the distribution of wealth in the United States?

So, this one's exactly equally distributed from the top to the bottom.

In the first chart, each one-fifth of the population has 20 percent of the wealth. In the middle pie chart, a middling amount of inequality: The richest fifth owns 36 percent, the poorest fifth, only 11 percent. And in the third chart, extreme inequality, where the richest fifth owns 84 percent of the nation's wealth, while the bottom two-fifths, 40 percent of the population, owns an almost invisible 0.3 percent of the nation's property.

Which one do you think the United States is?

MAN: I would -- I might say this one.

PAUL SOLMAN: You think the United States is completely equal, 20 percent, 20 percent?

MAN: It's not exactly equal, but that might be my guess that would be the closest, or maybe this one. It's one of the top two.

PAUL SOLMAN: And you?

WOMAN: Maybe the middle.

PAUL SOLMAN: What? The United States would be the middle?

MAN: I think the middle one is U.S.

PAUL SOLMAN: Middle one is U.S. Middle one is U.S. Middle one is U.S.

Which one would you think the U.S. was?

MAN: Hopefully that.

MAN: This would have to be Third World. This would have to be places like India.

PAUL SOLMAN: A place that would be incredibly unequal, right?

WOMAN: Yes.

MAN: Definitely.

MAN: The U.S. would be here.

PAUL SOLMAN: U.S. would be here. And this one?

MAN: I don't think that exists.

PAUL SOLMAN: At least he got that one right. The completely equal pie economy is completely made up.

The middle pie represents the wealth distribution of Sweden. The bottom pie? We asked two presumably low-income workers near the tourist line for "Letterman."

What place would have a distribution like this? What...

MAN: United States.

MAN: United States?

MAN: United States.

PAUL SOLMAN: United States?

Yes, this chart represents the land of opportunity, ours.

DAN ARIELY, Duke University: The study had a few different parts to it.

PAUL SOLMAN: Psychologist Dan Ariely designed the quiz. First consistent finding: Most Americans don't realize how unequal our country really is.

DAN ARIELY: People don't understand how much wealth the top 20 percent have. They actually have 84 percent of the wealth. And they think they have much less. And more disturbingly, people don't understand how little wealth the bottom of the distribution have. The bottom 40 percent of the U.S. have about 0.3 percent of the wealth, basically zero. And people think they have much more than that.

PAUL SOLMAN: But how can that be, given the spread of McMansions and luxury brands in America's wealthy communities so easy to contrast with almost any poor neighborhood in the country?

Harvard Business School Professor David Moss:

DAVID MOSS, Harvard Business School: People look around them at their local communities. And local communities tend to be more equal than the broader society. And so, as they look around, that's essentially their judgment -- or our judgment -- I should include myself -- see the same thing.

PAUL SOLMAN: So there isn't that much inequality in Newton, Mass., where you live, for example?

DAVID MOSS: Much less, much less than -- than in the society as a whole.

PAUL SOLMAN: Maddie McWilliams, who attends high school at upscale Newton, agrees.

HIGH SCHOOL STUDENT: It's getting easier for people to ignore the inequality. They can stay far away from it.

PAUL SOLMAN: Insulate themselves?

HIGH SCHOOL STUDENT: Yes, I think so.

PAUL SOLMAN: Another reason people don't realize the extent of inequality, most of it is explained by gains at the tippy-top.

Harvard economist Richard Freeman:

RICHARD FREEMAN, Harvard University: In the last 30 years or so, the share of national -- of income that has gone to the upper 0.1 percent -- not to the upper 1.0 percent -- 0.1 percent -- rose by 10 percentage points. That is one of the most astounding patterns I have ever seen in data.

PAUL SOLMAN: Point-one percent?

RICHARD FREEMAN: Point-one percent, yes.

People sometimes say, oh, the rich, it's the upper 10 percent, it's the upper 5 percent. No, no, this is the 0.1 percent. Warren Buffett has this wonderful statement where he says: Yes, there's been a class war in the United States. And my class, namely the super rich people, have won.

PAUL SOLMAN: A graphic, recent example, this New York Times online slideshow of children's playhouses, which can cost up to a quarter-of--million dollars. Meanwhile, more and more Americans, millions of them, can't afford their own homes.

DENISE BARRANT, homeowner: My house is in foreclosure. I owe them at least $100,000 more than my house is worth, probably closer to $150,000 more than my house is worth.

PAUL SOLMAN: Are they coming to take it away?

DENISE BARRANT: At some point, they will. They haven't yet, but at some point, they will.

PAUL SOLMAN: And then where will you go?

DENISE BARRANT: I have no idea. I have -- I try not to think about it, because I really have no idea.

PAUL SOLMAN: Denise Barrant has a college degree from Lehigh University, some master's level courses and a paralegal certificate. She once had a job at a health insurance company paying $80,000 a year, plus a part-time job, just for fun, she says, selling clothes at Talbots.

But for three years, she's been unemployed, free-falling out of the middle class and into poverty, living in a well-to-do Boston suburb she could once afford.

DENISE BARRANT: Even the organizations that were helping people before have been stretched so much, that they're having a hard time helping people.

PAUL SOLMAN: You mean it's hard for you to find a food pantry?

DENISE BARRANT: There is one in the next town over. And it was funny. I remember, the first time I went, the people were like, well, you don't look like you should be here.

PAUL SOLMAN: Don't have a lot of college grads like yourself at the food pantry.

DENISE BARRANT: I'm sure they didn't at the beginning, but I'm sure they do now.

PAUL SOLMAN: Barrant's situation has deteriorated since we first interviewed her earlier this year, and she said this:

DENISE BARRANT: The top 1 percent is living well, and they don't get it.

PAUL SOLMAN: One of her fellow interviewees was security guard Bobby Hicks.

BOBBY HICKS, security guard: Fifteen years ago, I was -- I was working as an office products delivery truck driver.

PAUL SOLMAN: And you were doing better doing that than you are now?

BOBBY HICKS: Yes, absolutely.

PAUL SOLMAN: Though Hicks was born in America; Christi Pierre-Louis in Haiti, her job frustration echoes his.

CHRISTI PIERRE-LOUIS: It makes me feel like the American dream is not just -- is not for me. It's just not for me.

Maybe it's for the wealthy, just not for me, because it doesn't matter how high I reach. You know, I'm reaching up my hands, and it seems like it's still -- I'm still -- still very far away from it. It's like someone literally pulling it. As much as I'm running after it, they're running away with it, and I don't get my piece of the American dream, because I work hard in this country, too. I pay my taxes, just like everyone else. I work here. I go to school. And I'm doing my best, but, still, my best is just not good enough.

PAUL SOLMAN: So, the U.S. looks unequal to a Haitian?

Economist Richard Freeman is not surprised.

RICHARD FREEMAN: We're high for a poor country, in terms of inequality, and we're a rich country. We're about the same level of inequality as China. And, of course, China, half the population are rural peasants who are not part of the modern world.

And if we were to compare us with African countries, dictators in different places, you know, taking a lot of the wealth from normal people, we would be among the top half of the African countries of inequality. So, the U.S. really has reached an extraordinary level of income inequality.

PAUL SOLMAN: The luxury goods speak for themselves. But who knew that the kids of the wealthy were flying private jets to camp this summer? OK, to some, this might be cause for indignation, but, to others, it's not that simple.

STEVEN DAVIS, University of Chicago: Inequality is the flip side of providing powerful incentives for people who generate a lot of income.

PAUL SOLMAN: Economist Steven Davis:

STEVEN DAVIS: Part of the success of the United States' economy lies in the fact that, if you succeed in a big way commercially, you're rewarded for that. And the taxes on your success are modest, say, compared to what they are in a -- in a country like France or in the Scandinavian countries.

PAUL SOLMAN: But as Dan Ariely found in part two of his study, and as our own informal survey confirmed, when people didn't know which countries the pie charts represented, they overwhelmingly chose the one representing a much more equal and yet still prosperous country, Sweden, as the place they'd prefer to live. A function of their politics, we wondered?

DAN ARIELY: We had 7,000 people distributed around the U.S., different levels of income, education, wealth, political opinions -- 92 percent of the Americans picked Sweden over the U.S. When we broke it by Democrats and Republicans, Democrat, it was 93 percent, Republican, it was 90.5 percent.

So there's a difference, but the difference is tiny. And one of the possibilities is that, when we dig deep down and we ask people to examine their core beliefs about a just society, Americans are really quite consistent in terms of thinking this is way too much inequality, and we want something that is much more equal to Sweden.

PAUL SOLMAN: And so, last question: Which distribution do you prefer?

Which society do you want to live in?

WOMAN: I'm going to go with this one, though.

PAUL SOLMAN: You want to be in the unequal society?

WOMAN: Sure.

PAUL SOLMAN: On the off chance that you will be in the yellow?


JEFFREY BROWN: Paul's next report examines the connections between the growing wealth gap and the financial crisis.

I think the Americans are not alone in this self-delusion.

The current problem with society all over the west is, that the middle class (or all who believe to belong to it) see themselves closer to the super rich than the poor. And even the poor believe that "one day my ship will com in". That's why hard working people oppose higher taxes for the rich, free education and cheap health care for all. They think all this "socialist crap" will one day cost them.

None of those (us) realize to be much closer to the dole, food stamps and the shelter than we are to our own yacht in Monaco.

But there is hope. Because as the great philosopher Tyler Durden said:

"We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. But we won't. And we're slowly learning that fact. And we're very, very pissed off."

Warren Buffet is a shill for the bankers and the government. He admitted that his company would have went bankrupt if there where no bailouts.

Originally Posted by amazon777

"We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. But we won't. And we're slowly learning that fact. And we're very, very pissed off."

HAHA! That is so true.

Originally Posted by bsnub

Originally Posted by amazon777

"We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. But we won't. And we're slowly learning that fact. And we're very, very pissed off."

HAHA! That is so true.

Indeed!! We are very, very pissed off!

Originally Posted by ArcherBKK

Originally Posted by bsnub

Originally Posted by amazon777

"We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. But we won't. And we're slowly learning that fact. And we're very, very pissed off."

HAHA! That is so true.

Indeed!! We are very, very pissed off!

I second that.

And you've got to love how assholes like Al Gore try convince us that we're creating unsustainable carbon footprints while he pays anywhere from $12-20,000 a month on his electric bill alone and leaves his car running while he gives speeches on the climate.

Every politician is an unscrupulous, self-centric, lying and cheating thief.

Originally Posted by Ambrosia

And you've got to love how assholes like Al Gore try convince us that we're creating unsustainable carbon footprints

We're not?

Originally Posted by amazon777

the great philosopher Tyler Durden said:

"We've all been raised on television to believe that one day we'd all be millionaires, and movie gods, and rock stars. But we won't. And we're slowly learning that fact. And we're very, very pissed off."

'Great Philosopher'? Never heard of him and besides, maybe you had all those lovely pipe dreams but there are a majority of folks who have known (if they have any common sense) it takes hard work to get ahead. There ain't no free lunch, man...

Originally Posted by Boon Mee

'Great Philosopher'? Never heard of him and besides, maybe you had all those lovely pipe dreams but there are a majority of folks who have known (if they have any common sense) it takes hard work to get ahead. There ain't no free lunch, man...

Booners you will never get it. The point of the fucking piece is that almost no amount of hard work can get you ahead in America when you are at the bottom. In case you missed it the top 20% have 84% of America's wealth. The bottom 40% have 0.3 percent of the wealth, basically zero. Thats 122 million Americans that have nothing. You dumbass I bet you neither read the transcript nor watched the video. Still spouting your irrelevant nonsensical garbage.

Sadly, Boon Mee is the typical 'Ignorant American' that has no idea what's going on in his own country.

That's why hard working people oppose higher taxes for the rich.

I doubt they do, but if they saw and understand that fucking chart they certainly would not!

The facts in the USA are sobering, to say the least. Not just the income inequality, but the trends in wealth concentration in favor of the richest 10%, or even more startling 1%, or 0.1%, are astonishing for a nominally advanced, post industrial society. They are, in fact, in line with those of a third world nation- or as we used to term it, a banana republic. They have now considerably exceeded the inequality that arose during the age of the 'robber barons', prior to the Wall St crash of 1929. That is not hyperbole, that is fact. Even this fact would not be so startling if it were not for the fact that, for the vast majority of Americans, incomes have actually stagnated or fallen in real terms over the last quarter century or so.

So booner et al, do you attribute that to the fact that the vast majority of Americans do not work hard enough, and therefore do not 'get ahead'? Because you could've fooled me, and I've known and worked with many amerkins.

Or is there something seriously wrong with the functioning of your government and economic system?

Originally Posted by Marmite the Dog

Sadly, Boon Mee is the typical 'Ignorant American' that has no idea what's going on in his own country.

So many of him too. It is a very sad reality that so many Americans are to stupid to vote in their own best interests.

Originally Posted by harrybarracuda

That's why hard working people oppose higher taxes for the rich.

I doubt they do, but if they saw and understand that fucking chart they certainly would not!

The working class is getting more and more aware of the fact that they are getting fleeced. Sad that it took so long.

Originally Posted by Marmite the Dog

Sadly, Boon Mee is the typical 'Ignorant American' that has no idea what's going on in his own country.

Right.

Like you do out in Nakhon Nowhere, Thailand who's never even been to America?

Originally Posted by sabang

So booner et al, do you attribute that to the fact that the vast majority of Americans do not work hard enough, and therefore do not 'get ahead'? Because you could've fooled me, and I've known and worked with many amerkins.

Or is there something seriously wrong with the functioning of your government and economic system?

The only thing that's seriously wrong here is this pervasive attitude that there are no jobs. B.S. Right now in my former industry they can't hire enough folks to man the positions in Brazil, Africa etc. That's a fact.

Originally Posted by Boon Mee

Like you do out in Nakhon Nowhere, Thailand who's never even been to America?

Says it all really.

Someone out in Nakhon Nowhere has a better grasp of American reality than most who come from there. But, I haven't been subject to the brainwashing that you have, so it's understandable (if you're allowed to actually think, that is).

Originally Posted by Boon Mee

Originally Posted by sabang

So booner et al, do you attribute that to the fact that the vast majority of Americans do not work hard enough, and therefore do not 'get ahead'? Because you could've fooled me, and I've known and worked with many amerkins.

Or is there something seriously wrong with the functioning of your government and economic system?

The only thing that's seriously wrong here is this pervasive attitude that there are no jobs. B.S. Right now in my former industry they can't hire enough folks to man the positions in Brazil, Africa etc. That's a fact.

What trade is that Booners? And what's the money like? An average US salary with expat benefits?

Originally Posted by Marmite the Dog

Originally Posted by Boon Mee

Like you do out in Nakhon Nowhere, Thailand who's never even been to America?

Says it all really.

Someone out in Nakhon Nowhere has a better grasp of American reality than most who come from there. But, I haven't been subject to the brainwashing that you have, so it's understandable (if you're allowed to actually think, that is).

'Better grasp of American reality'

You're the one who's getting brainwashed listening to the Lamestream Media hacks decrying what a pitiful place America is. As is always the case, boots on the ground tell a different story. Stop drinking the Kool-Aid Marmite...

Oh, btw, the article in the OP was produced by none other than that infamous left-wing yellow sheet Public Broadcasting.
Not a real unbiased news source, eh?

Originally Posted by Marmite the Dog

Originally Posted by Boon Mee

Like you do out in Nakhon Nowhere, Thailand who's never even been to America?

Says it all really.

Someone out in Nakhon Nowhere has a better grasp of American reality than most who come from there. But, I haven't been subject to the brainwashing that you have, so it's understandable (if you're allowed to actually think, that is).

How do you know you aren't the one being brainwashed? Do you get all your info from watching BBC?

Originally Posted by harrybarracuda

Originally Posted by Boon Mee

Originally Posted by sabang

So booner et al, do you attribute that to the fact that the vast majority of Americans do not work hard enough, and therefore do not 'get ahead'? Because you could've fooled me, and I've known and worked with many amerkins.

Or is there something seriously wrong with the functioning of your government and economic system?

The only thing that's seriously wrong here is this pervasive attitude that there are no jobs. B.S. Right now in my former industry they can't hire enough folks to man the positions in Brazil, Africa etc. That's a fact.

What trade is that Booners? And what's the money like? An average US salary with expat benefits?

Offshore Oil Exploration.
Average wage for technical hands Gulf of Mexico upwards of 75K USD per annum. Overseas it's a lot better. Health insurance, retirement plans, 401(k)'s. All depending which company you work for.

Originally Posted by Boon Mee

As is always the case, boots on the ground tell a different story.

Yes they do. A reality that you are very much removed from fox news robot. People like you exist to push Rupert Murdoch and the Koch brothers lies. You have not addressed the core statistical numbers nor can you. You are a dipshit tin can that get beaten around by Americas elite.

Originally Posted by Boon Mee

Offshore Oil Exploration.

Big oil terrorist. That says it all.

Originally Posted by bsnub

Originally Posted by Boon Mee

As is always the case, boots on the ground tell a different story.

Yes they do. A reality that you are very much removed from fox news robot. People like you exist to push Rupert Murdoch and the Koch brothers lies. You have not addressed the core statistical numbers nor can you. You are a dipshit tin can that get beaten around by Americas elite.

You don't have a clue, pal...