What’s the Structure of the New American Dream?

Related to the previous post on millionaire households, I'll refer to an article that was pointed out to me in response.  From NPR:  Why the Haves Have So Much (source:  http://www.npr.org/2011/10/29/141816778/why-the-haves-have-so-much?sc=fb&cc=fp).  This article opens up a huge can of worms for America by discussing how we've become a "winner take all" society.  Decades ago, starting a business and growing it to success and market dominance took decades, and even then there was rooms for others.  The example cited in the NPR article is tax preparation:  in the last century, there were millions (no number cited, so perhaps I exaggerate) of local accountants doing peoples' taxes for them.  Then larger corporations like H&R Block and Jackson Hewitt began leaving the major urban centers and branch out, opening up shops in smaller locales.  Still though, there was room for mom and pop back-room businesses.  However, enter the internet age, and Turbotax.  People who once went to their local accounts could now effectively and efficiently do their taxes at home.  One company put potentially thousands of smaller ones out of business, and put a huge crimp in the income of the rest.

I like the example I came up with even better:  Netflix!  Back in the 80's, we'd go down to our local mini-mart, gas station or supermarket to rent a VHS tape for the night (and woe to those who didn't get it back first thing the next morning and face an additional day's charges!).  There were also independent video stores to be found every few blocks.  In the 90s and early 00s, Blockbuster and Hollywood Video popped up and expanded, but there was still enough market for the mini-marts to keep movies on their shelves and the independents afloat.  However, Netflix came along and Hollywood Video is gone, Blockbuster is floundering (no discussion here of Netflix's recent troubles, thanks), and unless it's an adult-themed shop, independent video outlets no longer exist at all.

So here's the dilemma:  is the American way - starting at the bottom and working your way up to riches and success - no longer admired?  Is it no longer valued?  When starting from scratch - in your basement with an idea for a web-based business - and working your way to success can now mean putting thousands out of work in our internet-based society, does that make you an American success story, or worthy of vilification?   How do we need to adapt to this new construct?  Is it an argument for Socialism, or are we doomed to split into a permanent structure of haves and have-nots, except for the occasional person who has the good-idea fairy visit them and manages to claw their way out of the masses?

It's a fascinating puzzle, and I'm not sure what it will look like when it's finished.  Heck, I'm not even sure we have all the pieces in the box, and that scares me.  But we still have to try.  It would make a heck of a thesis for an economics or sociology grad student.

The 99% Seems to Actually be the 93-95%, and Falling...

So before we get into the meat of this and I have people reading the first few lines and dismissing me outright, I need to point out that I do support the idea behind OccupyWallSt (as long as Wall St doesn't turn into Vancouver), and support free speech and freedom of assembly.  I believe our nation is in a fiscally precarious position, that the national debt is actually our #1 national security issue right now, and that promoting the creation of jobs is a key issue in turning that around.  However, in our world, especially through the media, it seems the way to "win" or at least get the most attention is by making everything seem to be the most extreme, worst-case scenario possible, and I don't play that game.

Today's blather is based on an article I saw this morning:  "US States with the Most Millionaires- 2011" (source:  http://finance.yahoo.com/real-estate/article/113718/states-most-millionaires-cnbc).  Phoenix Marketing International released a study showing "the overall number of millionaire households in the U.S. has increased nationwide for the second time in two years. In 2011, there were 5.94 million millionaire households, compared with 5.56 million households a year earlier, an increase of approximately 6.8 percent. Nearly every U.S. state saw an increase in its total number of millionaires, adding thousands of households to millionaire status."  The article also mapped out how, for the top ten states with the most millionaires, 6-7% of the total number of households in those states were millionaires.  Think about it - there are a lot of wealthy households out there, and probably a lot more that are below the millionaire line but doing really well too.

There's a lot data there, and a lot of implication too (which I wish I could get more data for, to confirm or refute).  If the number of millionaire households across the US grew by half a million in just one year, there's an implication that households with a value less than that grew as well.  If this could be confirmed, the overall inference one could draw is that the US economy is not as in bad a shape as it's being portrayed, at least for the individual American.

Are there huge problems?  Of course, especially for the 10% or so that are unemployed, and I stand by my assertion of our debt being our largest security issue.  However, if you have a job, overall it seems like a significant portion of the nation, while tightening belts a little, is doing okay.  And I'm not even going to go off (too far) on a tangental rant on how people are showing how coddled they are by demanding the government bring jobs to them, rather than going to where the jobs are.

I do feel that the corporate pay structure is way out of whack, but it's up to the people that own the companies - the investors - to fix that, as unlikely I think that is to happen.  Not the government.  Because if the government tries to start regulating CEO pay, then we've failed as a nation and have started going down the route of China and the Soviet Union, and in the end even more will be suffering than now.