T Nation

Rich and Poor


#1

Recently the Liberal Joke thread has become an argument over the rich and the poor.

I was going to respond there, but decided to start a new thread about this subject instead because this really needs to be better understood then it is.

First welfare recipients and poor are not the same thing. Also, if I remember right, the average person who receives welfare only is on if for less then 3 years. (It could be less then two actually, and this statistic is about 10 years old.) So most welfare recipients are not the "welfare queens" often depicted.

On the opposite side, at least 80% of current millionaires are first generation millionaires. The term "trust fund baby" comes up quite a bit, as a way to say a person did not earn their wealth. Yet many people who are wealthy children of the rich actually did not receive wealth from their parents as much as an education in how to create that wealth.

But there are both welfare queens, and trust fund babies, don?t get me wrong. I have known a couple welfare queens, and Paris Hilton is a great example of a trust fund baby.

But they are actually the same thing with different circumstances. Both actually have the problems of life blunted, and without those hard knocks of life, you become spoiled. Take the carrot and stick, remove the stick, and you have a big problem.

Neither person is going to be truly successful in life, and both are truly pitiful, and actually have a harder time becoming successful.

Now in the other thread rainjack said:

"There are more hard working millionaires than there are hardworking welfare recipients."

People wanted to argue this, but never actually read it, or even thought about it. They just wanted to jump into the fight.

If you are on welfare, it most often means you are unemployed, or underemployed. That means less work then average. (A large number of recipients are pregnant, or recently parented teens.) Next is the millionaire, who works an average of 60 - 80 hours a week. The average American works less then 40. Even with many working 2 jobs, the average is still less then 40.

Discussing the poor, and not just welfare recipients, plain logic can bring some facts. Like a larger percentage of the poor are abusing drugs. This does not mean being poor causes people to use drugs, what I am saying is that if you are abusing drugs, you are more likely to be poor. The same with alcoholism, and a whole host of character flaws.

The rich are also susceptible, and they may not lose everything, but it is harder to maintain it with such problems.

On the other side, can anyone deny that if a person works hard, and is frugal, they cannot become successful? Isn?t a hard working, frugal living person more likely to become wealthy? That also will also push the numbers of hard working people into the millionaire status.

I have a friend headed that way. Working 2 jobs to make $40,000 a year, and still puts $1,000 away each month. Not a millionaire yet, but halfway there. I estimate he will be there by the time he is 50. (And this is with him paying alimony and child support.)

Now the majority of complaints you hear about the rich and the poor are by the middle class. They are upset that they have to work while it seems like the people on welfare don?t. (Not the full story.) And at the same time another group of middle class complains about the rich, thinking they need to be knocked down a peg, upset that they work hard, and have not benefited from "life's lottery". (Again not the full story.)

The singe biggest reason most people are not rich is because of something called delayed gratification. Instead of being able to wait, too many people want it now. If you have had a balance on your credit card over the last 6 months, this is you. If you bought your car with a loan instead of cash, this is you.

Researcher did a little test years ago where they gave children some M&M's, and told the children they could either eat them now, or wait a few minutes, and get twice as many. Some children waited, and some didn't. When following up years later they found that the children who waited were more successful later in life then those who didn't.

To really understand this, look at all the fat people who want to be lean, and muscular, but do not want to work out or diet. They might be looking for the magic pill, or checking into liposuction, or wrapping their fat with plastic. Then they look at the people who actually work out, diet, and say they are lucky, or have good genes, or just benefited from "life's lottery".

I am not rich myself. Over the past year my wife and I have paid off 14 medical bills, and we still have a few to go. But a big part of our problem is the fact that we didn't learn these lessons earlier in life. I received assistance from my parents early on, and fell for the idea that credit is good, and the only way to buy a car is with a loan.

There are actually some good statistics in the book The Millionaire Next Door. I was surprised that I had actually paid more for a watch then the average millionaire.

What makes them rich? Hard work and frugality. They are much less likely to have received what the book calls economic outpatient care, i.e. money from the parents.

Instead of bitching about the rich, become one. Worried about the poor? Get rich and give away a lot of money, or start a trust fund to forever supply financial assistance to the poor.

The poor may not be what you think, but neither are the rich. All those people living in mansions, driving BMW's, wearing the Rolex, are more often then not living the dream of credit. Being rich means you have money, not stuff. And often having stuff means you do not have money.


#2

Ah, the myth. Every man can make himself rich with a little hard work and a pair of ruby slippers.


#3

Just wanted to say good post!


#4

True more than not. If you are poor and want to get a secondary education, there are scolarships , milatary service and loans available - whoah bush is cutting those sorry poor folks - had to throw in the bush jab there.

But given that student loans aren't cut drastically, there are still oppurtunities around for those that want to work hard.


#5

Myth? Based on 20 years of research.

Guaranteed? Nothing is.

The point is your chances are much greater if you do the right things. My chances of survival are greater if I don't jump in front of moving buses.

Your chance of building muscle is greater if you lift weights. Most people would rather complain then lift the weights.


#6

Ever meet a person who worked 3 jobs while going to school? I have. I also knew a guy who spent 5 years working 2 jobs and saved $20,000 before he ever went to school. (Almost a decade ago.)

If you want it you will find a way.

(Damn I am starting to feel like an infomercial.)


#7

Ah, the drive-by potshot. Every well-thought-out argument can be deflated by a single baseless and/or flippant remark.

Meanwhile, back in real life Experience supports Theory. Here I am, broke off my ass, and who do I have to thank? I can't blame it on the color of my skin, or even my gender, so who should I blame? It must be the fault of the "rich ruling class", right? If only we would increase their taxes so I could get more free money, I'd be SO much better off!

WRONG! My problem is that I failed to save money when I had the chance. I've lived beyond my means ever since I got out of school. I became a parent before I was ready. I spent every cent of money I ever made till it was all gone, then I spent just a little more for good measure. If I'd behaved like a responsible earner for the past 10 years instead of like a dumb kid, I'd probably be pretty well set right now, and then what? Well, I'd be one of the "lucky ones" right? I'd deserve to get taxed more because I had benefitted from the burden of others, I suppose?

WRONG again. I can look back and point out every mistake I've made and tell you exactly how it helped result in my current situation.
I've never made a lot of money, and I've always had bill that had to be paid. But I've also always spent more than I had to. It's something I'm working on, and it's something I'm sure a lot of other people in my situation could stand to work on as well.

Personally, I'm sick of living in a society where the successful are punished.


#8

The successful aren't punished. Look, it is certainly true that the path to getting ahead involves hard work and taking advantage of the opportunities available to you.

I don't think anybody will argue with that.

My concern is this belief that everyone who works hard will make it. The system isn't set up that way. Not everyone gets the same chances.

Anyway, my biggest issue is with those that have made it (including me) who then think everyone else is a lazy assed dope if they don't.

I've thought that, previously. It's an easy trap to fall into.


#9

Excellent post.

We all know vroom to be a liberal and what he will say is that you had advantages in that your parents taught you something or you have the ability to learn from your mistakes that others don't have. In other words, no matter what the issue those who are successful always have some advantage over those who don't.

So liberals would say the system is unfair so we have to even it out by taxing the rich and giving it to the poor. Well, while this may sound feasible, there are always those, who against all odds are still successful. Those who had no parents and no advantages and are still successful.

So the question is then should people have to work hard to be successful? I contend that it depends on your motivation. Obviously, the harder it is to succeed the more people will choose to not succeed or be less successful. I personally worked fulltime and went to college fulltime at the same time to pay for my education. I worked swing shift and went to school during the day. It was a major pain in the ass, but it was my goal. So I did it.

Sure I could now work 60-80hrs per week to be a millionaire, but that is not my goal. I would rather spend more of my time enjoying life than have all the latest stuff, biggest house, etc. But I know that is my choice. And that is the bottom line, choice!

Regardless of my advantages, or lack thereof, I have a choice to work hard and achieve what I want if I'm willing to pay the price. Most don't want to pay that price, but still want to be rich. That is where the left comes in. To take advantage of this "something for nothing" mentality. Vote for me and I will give you free money!


#10

Not lazy (well maybe some are), it is what they are willing to do. How hard are you willing to work? How many sacrifices are you willing to make now for future rewards? If anyone is willing to make the needed sacrifices they WILL be successful.

The system will and does allow anyone to be successful. The fact that more are not successful is their own choice. Now would the system break down if everyone made the choice to be successful? Probably. There would still be need for people to do the menial tasks we take for granted, and if everyone was successful we would have no one to do these tasks. However, whether it's genetic or learned, many people will not choose delayed gratification and hard work over easier work and having it now. So the system works because of human nature.

But the point still is that it is their choice, so they live with the results of their choice.

You somehow think that is unfair, but since everyone lives in the same system it is fair. The fact that many choose not to do what needs to be done is human nature and not something that should or can be corrected.


#11

This will be the first time I'll admit this publicly. I did not graduate high school. I had to get a job at 17 and support myself because I couldn't get along with the step dad. I rented an apartment, and worked 60 plus hours a week trying to make ends meet. NOTE, my first job was in the oilfield rebuilding tools. I worked this job for 4 years and hated every minute of it, it was dirty, hot, long and the pay wasn't that great. But I learned alot

Left that company and went down the road to do the exact same thing for a few bucks more, stayed there about a year.

The next company I went to I was in the same general profession and I was making a little less money but I seen more oppurtunity for advancement. I stayed there for 3 1/2 years.

Then one day I answered an ad for a mechanical supervisor for a Canadian company working in Mexico. They called me and offered me a job working 28 days on and 28 days off. When they told me I would make 417.00 per day I liked to have shit myself. This was more money in one day than I used to make in an entire week.

I worked this job for about a year, even though it was excellent money, @72,000 per year, my wife didn't like me being gone a month at a time. I answered an ad for a compnay here doing the exact same thing, but instead of having to leave and work out of town I'm a mechanical supervisor stationed in town. I have drilling rigs in Russia that I supervise from here in Houston.

I make close to 100G a year with bonuses, I have a nice vehicle a new house and two kids with another on the way. Not to bad for someone with a 10th grade education?

You are in charge of your own destiny, if you see an oppurtunity take it, there is no one to blame but yourself.

BULLPUP


#12

What is your definition of made it?

I know people who work really hard and are barely making it, and I know people that work very little, and make more money than most people can earn in a lifetime.


#13

Precisely! That makes it two of us...


#14

How successful are we talking about? Let's say, over $10M in net worth?

Does that include moral and ethical sacrifices, including, but not limited too, lying, cheating, back-stabbing, etc.?

If it does, I'll agree.

Do bear in mind that I am in a position that I meet successful professionals on a daily basis, so I'm pretty sure I have a very good sample...


#15

If he started at around 27-28 and he is putting it in the stock market (10% a year average interest), that is indeed a good estimate (that he'll have $1M by the time he's 50).

Problem is that by that time, his $1M will not be enough to even buy a condo. There's this little thing called inflation, you know...

Even today, in the region I live in, $1M of Net Worth puts you in the middle class.

These days, most economists define as "successful" anyone with a Net Worth over $10M, and "wealthy" anyone with a Net Worth over $100M.

Most CEOs I know are in the "wealthy" category, while most Executives are in the "successful" category.


#16

Don't get me wrong. A lot of the wealthy people I know worked really hard for about 5 - 10 years, but they don't have to anymore.


#17

Guys that play X-Box every night never seem to turn into wealthy or fit people.

Just my observation.

Credit cards are a bad idea - pay for anything you can (outside of maybe a house) with cash. If you're in debt - snip your cards and learn to do without for a while - it'll probably do you some good.

My dad used to tell me to only 'spend money to make money' - now, of course, a person has to live outside of this a bit, but try to stick to that rule as well.

Don't Drink Pop - it costs money and it's not good for you.

Don't Smoke - it costs money and it's not good for you.

Don't Abuse Drugs - they cost you money and they're not good for you.

Remember...few worthwhile people find sloth and poor decision-making as positive traits in an employee, friend, or love interest.

Build those muscles - get athletic - I'll tell you what - 10 out of 10 times, I'm going to hire the ambitious, fit, attractive person over the person who looks like they can't take care of themselves.

That's what I like about a forum like this - if you care about your body the way it seems most people on here do, you've got 95% of the rest of this country beat -

Alright, I need to get back to work before I'm accused of being the guy who just screws around on the computer all day.

CR


#18

I'd rather have stuff than money. That's what money's for, getting stuff. And services. Those misers in The Millionaire Next Door make no sense to me.


#19

That is the exact reason why 95% of the population don't have a savings that is equeal to or greater than 1k.
Which also explains why 98% of the people over 65 are either dead or broke.


#20

I didn't get you wrong, don't worry. :slight_smile:

My problem with this discussion is sweeping generalizations. I don't remember every saying ALL (or even MOST) rich people are lazy. I made some comments about their ethics, but that's a completely different discussion.

Currently, my biggest discussion points are:

a) A LOT of people who work extremely hard and are essential to this country's economy never get rich -- not even remotely so

b) A corollary of a) -- working hard, by itself, does not mean you'll get rich

c) Getting wealthy requires luck, knowing the right people and, quite frequently, being willing to make ethical and moral "sacrifices", i.e., putting your ambition ahead of ethics and moral values

d) A corollary of c) - a lot of people never really get the opportunity to make it to the middle class -- much less to the upper class -- even if they do everything they can possibly do, including (but not limited to) working hard; some times it is because they were born in the wrong place at the wrong time, others because they were NOT willing to make ethical and moral sacrifices

e) The underlying philosophy of SOCIAL DEMOCRATS like me is that everyone should be given an equal OPPORTUNITY at being successful -- which does NOT mean everyone should be making the same, independently of their contribution to society. The secondary objective is for people to have an income that is more proportional to the value they're adding. I have no problem with a CEO making $10M a year if s/he is helping the company grow proportionally to that.

f) We should stop, once and for all, correlating the presumption of innocence with one's net worth. Rich people should NOT have a better chance at getting away with crime

g) A corollary of f) - white collar crime should be as severely punished as violent crime, with hard jail time, in high security prisons. The maximum penalty for securities fraud is 10 years in prison, followed by three years of probation, usually in prisons that look more like resorts. That is pathetic. It should be at least 30 years, in the same prisons as violent criminals. People need to realize that crime does, in fact, NOT pay. It's paying way too much way too often, and that needs to stop.