Land of (unequal) opportunity

by John Quiggin on January 6, 2012

A little late to the game, the NY Times has quite a good piece by Jason DeParle on the well-established finding that the US is not only the most unequal of developed societies but is also at the bottom of the scale for social mobility.

I’ve been arguing since the Triassic era of blogging that this isn’t a coincidence – a society with highly unequal outcomes can’t sustain equality of opportunity, but until this year (in fact, until the emergence of the Occupy movement) I didn’t see any evidence that the facts were sinking in, even among the majority liberals. Now it’s as if a dam has broken. Some thoughts, cautionary and otherwise over the fold.

* As I mentioned a while back, the research evidence of low social mobility in the US has been around for at least a decade, but seemed to have no impact on the policy debate. That’s changed, but I doubt that Americans who don’t follow the debate closely have had their beliefs on the subject challenged. In this context, I’m not sure if the NYT piece will have much effect. It was very briefly on the front page of the website earlier today (Oz time) but is now almost impossible to find unless you know what to search for.

* It’s striking how limited, and ineffectual, the pushback from the right has been. There’s been a huge effort to deny the glaringly obvious increase in inequality of income and wealth. By contrast, social mobiity is hard to measure and it’s never difficult to find examples of people who’ve done very well despite deprived backgrounds (Obama, for example). Yet even  the National Review has accepted the evidence on this point (OTOH, DeParle quotes a lame rejoinder from Heritage and some predictable spin from Reihan Salam).

* The most significant move on the right is Rick Santorum’s adoption of this theme. It’s not hard to work out the political logic of concern about the emergence of a society where your prospects depend mainly on who your father was. But it raises some interesting possibilities. For example, how long before Santorum, or an attackPAC working for him, runs an ad with this “money shot” photo?

{ 67 comments }

1

roger 01.06.12 at 8:11 am

I, too, wonder about the reason that the death, or at least dying, of upward social mobility has been so off the map in the U.S. Could it be that this simply isn’t a concern of the top 1 percent – or at best, the top 10 percent- who fabricate public opinion in the media? Because the story to them may well seem different. Haven’t women broken the glass ceiling and become CEOs? Hasn’t a black man become president? As class disappeared from even leftist discourse in the U.S., it took with it the larger measure of social mobility, which was filled in by ‘exemplary’ gender or racial mobility. Exemplary mobility replaces egalitarianism with role model-ism – so that, to take a recent example, Meryl Streep can give interviews about her role as Maggie Thatcher in the recent biopic where she makes the case that Thatcher was a sort of feminist breakthrough for women – a case that would have been laughed at and ridiculed in the seventies, when feminism was still connected to a radical tradition, but not so much now, when it is connected with competition among the 1 percenters that the rest of us are supposed to have a rooting interest in, rather like spectators at a game.
And so you never hear anything in the mainstream press about the fact that, for instance, Obama has presided over the worst depression in Black America since Civil Rights days – an amazing collapse of wealth and income that will take a generation to repair. Because after all, the ‘promise’ has been kept and a black man is the president. Of course, in fact, the promise has been broken and millions of lives are the worse for it, but in the sphere of public opinion makers, this doesn’t compute.

2

bert 01.06.12 at 8:27 am

bq. It was very briefly on the front page of the website earlier today (Oz time) but is now almost impossible to find unless you know what to search for.

Everyone complains about the MSM, often with reason. You’d prefer the website editors to be giving it more prominence. But I think it’s hard to argue that the Times is selling you short, John. Page A1 of the New York edition. Currently #2 ‘Most Emailed’. 1000-odd comments and counting.
You’re doing your bit by adding bloglove via linkage. For which, thanks – it’s an interesting piece.

3

J. Otto Pohl 01.06.12 at 9:19 am

Roger is right that the corporate elite had no trouble co-opting the identity politics movement in the US. Thomas Frank writes about this mechanism in the Conquest of Cool. Where the “counterculture” became just another advertising gimmick for large corporations. He continued on the theme in What’s the Matter with Kansas. According to this schematic a number of Black, Woman, Hispanic representatives are taken into the elite to give them ethnic and gender diversity. Even though their class and ideology is the same as the White elite. Meanwhile the majority of all Americans find themselves losing economic ground even if the ruling class is now less White and less male.

4

Russell Arben Fox 01.06.12 at 12:28 pm

I agree with Roger and J. Otto, and it’s not just Thomas Frank that has looked into this phenomenon; Walter Benn Michaels’s excellent The Trouble with Diversity does so as well. I’m not fully on-board with their takes; I think both of them fail to recognize the important ways in which culture, identity, and community are (or should be) tied together in a proper egalitarian politics. But their observation that identity can (and often is) a relatively easily deployed trope or fig leaf or distraction by the economic elite, complicating the fundamental importance of class (and, in reference to DeParle’s piece, particularly class (im)mobility), is, I think, incontestable.

5

Hidari 01.06.12 at 1:01 pm

I think another piece of the jigsaw is revealed in this story about Ireland in the Guardian.

‘Despite the drastic cuts, house repossessions and job losses, there have been none of the explosive, violent protests of Greece. A year ago there was a march of 100,000 people in Dublin, but since then protests have been muted – leading commentators to ask why the Irish are taking it so quietly. Many say it’s because they know it’s payback for living beyond their means during the boom. But O’Flynn dismisses this.

“Around here people didn’t go mad. This propaganda that we all partied through the good times is complete bullshit.” Instead he blames the lack of civil disobedience on “bystander syndrome”. “The more witnesses you have to a crime the less likely people are to intervene – I think that’s what happening. This is the biggest bank robbery in history. The difference is it’s the banks robbing us.”

McNamara says many people are worried about being seen protesting, fearing it may affect their jobs, or their ability to borrow money from the banks. And both men agree that many Irish people just feel too despairing to believe they can make a difference.’

The article earlier on also points out that protests are generally ignored by the corporate media. As has the issue of income inequality/immobility by the corporate media in the ‘States.

So you have three barriers to anyone doing anything.

1: Don’t tell anyone there is a problem*, and if you have to, don’t tell people that anyone is doing anything about it (cf the way the corporate media fell over themselves to give publicity to the Tea Party, and then ignored the Occupy Movement for as long as possible).

2: Create a system of laws (harassment, censorship, erosion of legal due process, high unemployment) such that people are too frightened to protest.

3: Create a sense of despair and hopelessness so that no one feels that there is any point about protesting about anything. Or, for that matter, doing anything at all other than working, playing video games, watching TV, eating junk food, and sobbing.

So you can tell people anything you want as long as people feel that nothing can be done about it.

*As the original post points out, this data has been well known for the better part of a decade, but it is only now that (1) newspaper article draws it to the public’s attention.

6

FredR 01.06.12 at 1:02 pm

The discussion in the comments here seems immediately to have turned to the issue Richard Rorty identified years ago in “Achieving Our Country.” He argued that by focusing so much on identity (race, gender, sexuality), the post-60s left neglected economic equality. If I remember correctly he was careful to point out that ideally they would be able to do both, but argued that, for whatever reason, the left didn’t seem capable of doing so.

7

Joe 01.06.12 at 1:09 pm

Is there any mention of how overall mobility rates are affected by the number and education level of immigrants?

8

Henri Vieuxtemps 01.06.12 at 1:14 pm

On the identity vs class politics, Walter Benn Michaels is the man.

9

J. Otto Pohl 01.06.12 at 1:20 pm

FredR:

I am not a leftists so I won’t comment on what they can or should do. But, it is clear that the Old Left both in the US and elsewhere was comparatively retrograde on issues of racial and gender discrimination. It is perfectly possible to have a socialist organization or even state that practices racial and gender discrimination. In fact it is silly to think that such discrimination would cease to exist just because there was a commitment to economic equality. A lot of US unions that were good on workers issues were not so good on racial issues.

In light of the above I think there were movements in the 60s and 70s to concentrate on the removal of racial and gender discrimination since it seemed to persist in even the most left wing of organizations. They did this at the expense of the economic issues that were the bread and butter of the Old Left. The corporate elite, however, were able to co-opt these later movements easily. Corporations don’t care about maintaining systems that totally exclude people of color and women. They are not the former government of South Africa or the Kingdom of Saudi Arabia. They care about making money.

The color of money is green. To corporate America the Old Left with its emphasis on workers rights was an inherent threat. The newer movements aimed at removing racial and gender barriers posed no such threat. Rather they could be co-opted much in the same way that the colonial powers used to co-opt local elites in Asia and Africa.

10

Shane Taylor 01.06.12 at 1:41 pm

Over at Working Economics, the EPI blog, there were two posts that jumped off from the DeParle article: here and here.

11

engels 01.06.12 at 2:17 pm

Is it surprising that an excess of the ideology of opportunity goes hand in hand with an absence of its reality? American political debate plays out the Dunning-Kruger effect on a macro scale…

12

Tim Worstall 01.06.12 at 2:27 pm

“well-established finding that the US is not only the most unequal of developed societies but is also at the bottom of the scale for social mobility.”

Isn’t it because instead of also?

Assume two countries, one where it takes an extra $5,000 a year to change income decile, a second in which it takes $50,000 a year to change income decile.

That second is more unequal and also is highly likely to have less social mobility. So isn’t it, at least in part, because not also?

13

Uncle Kvetch 01.06.12 at 2:38 pm

However cliche it may sound, a great many Americans really do see wealth as a reflection of virtue, and our elite agenda-setters are all too eager to keep it that way. Witness the ruminations of David Brooks or Megan McArdle about how the crisis isn’t one of economics, but of “values.”

Given this mindset, it’s quite easy to spin a lack of upward mobility as a good thing. Making it difficult to climb the ladder ensures that only the truly virtuous and deserving will do so. Make it too easy and a whole lot of people could just get swept along with the rising tide, whether they’ve earned it or not.

14

krippendorf 01.06.12 at 3:47 pm

Tim: depends on whether you’re talking about absolute or relative mobility. The economists’ preferred measure of social boundaries as income deciles obfuscates the two, IMO.

I find this article incredibly frustrating. It’s not like sociologists haven’t been making the point about American unexceptionalism — and with better measures — for 50 years or more. But economists “discover” immobility and all of a sudden it’s front-page news. Pah.

15

marcel 01.06.12 at 3:50 pm

The links in the phrase, “mainly on who your father was”, are primarily to famous children of famous fathers, except for one to George Romney. Was this one intended for Mitt? Geo. Romney’s father doesn’t seem especially famous (outside of Mormon circles, anyway).

16

SamChevre 01.06.12 at 3:51 pm

Note that Kevin Drum highlights one set of charts from the NYT article here, and notes that the difference in social mobility between the US and Denmark is concentrated among children who grow up in the bottom quintile.

17

MPAVictoria 01.06.12 at 4:29 pm

It is hard to get people to question national myths.

18

K. Williams 01.06.12 at 5:03 pm

As Sam points out, the lack of social mobility in the US relative to other developed countries is almost entirely a function of the fact that the bottom 20% in the US are much worse off, and much more immobile, than the bottom 20% in other countries. There is, contra John, no good evidence that social mobility for Americans in the top 80% is meaningfully different from social mobility in other countries, nor is there any good evidence that social mobility has shrunk over the past thirty years. It’s certainly true that who your father is has a profound effect on where you end up, but for most of the population that’s no more true of the US than of other developed countries.

19

RK 01.06.12 at 6:15 pm

Yeah, Tino Sanandaji makes a similar argument: income inequality among Scandinavian Americans is generally pretty high. He also hypothesizes that part of the difference is due to measurement error, since intergenerational educational inequality isn’t much higher in Northern Europe.

20

MPAVictoria 01.06.12 at 6:16 pm

“nor is there any good evidence that social mobility has shrunk over the past thirty years.”

Can someone else confirm this? Because I am pretty sure that it is not true.

21

Barry 01.06.12 at 7:58 pm

Tim Worstall:

“Assume two countries, one where it takes an extra $5,000 a year to change income decile, a second in which it takes $50,000 a year to change income decile.

That second is more unequal and also is highly likely to have less social mobility. So isn’t it, at least in part, because not also?”

Only if the difficulty of making a move in the two countries is the same, by absolute value, and not by percentile.

Or in short, this objection doesn’t make surface sense.

22

roger 01.06.12 at 9:12 pm

The conservative argument that there is plenty of social mobility at the top has always amused me. They come to this conclusion by intentionally confusing wealth and income. If for instance Steve Jobs accepted one dollar in salary for a year because he was bringing Apple back – which I believe happened – conservative accounting counts Jobs as suddenly grossly poor. And then he rises back up to the top! Social mobility happens like magic.
But, contra K. Williams, there is plenty of evidence that “that social mobility for Americans in the top 80% is meaningfully different from social mobility in other countries, nor is there any good evidence that social mobility has shrunk over the past thirty years.”
So, where can you find that evidence?
Look, for instance, at this Princeton site: http://futureofchildren.org/publications/journals/article/index.xml?journalid=35&articleid=85&sectionid=514&submit
“So the changes in the American mobility pattern since the early 1970s have resulted in more downward mobility, especially for the offspring of the most privileged classes, and somewhat less upward mobility. Table 4 shows our calculations of the amount and direction of men’s occupational mobility; that is, the share of men upwardly mobile, downwardly mobile, or immobile by year of birth. The earliest cohort (born in the 1930s) first entered the labor force in the 1950s and reached its top earning potential around 1980; the latest cohort (born in the 1970s) first entered the labor force in the 1990s and will reach its top earning potential around 2020. Almost half of the cohort born in the 1930s was upwardly mobile; only one-fourth of that cohort was downwardly mobile. Since then, fewer men have been upwardly mobile and more have been downwardly mobile. Among men born in the 1960s and 1970s, downward mobility is almost as prevalent as upward mobility. Immobility rose across cohorts from one-fourth to one-third.”

This is from the abstract of the IZA study: http://ftp.iza.org/dp1938.pdf
“We develop methods and employ similar sample restrictions to analyse differences in
intergenerational earnings mobility across the United States, the United Kingdom, Denmark,
Finland, Norway and Sweden. We examine earnings mobility among pairs of fathers and
sons as well as fathers and daughters using both mobility matrices and regression and
correlation coefficients. Our results suggest that all countries exhibit substantial earnings
persistence across generations, but with statistically significant differences across countries.
Mobility is lower in the U.S. than in the U.K., where it is lower again compared to the Nordic
countries. Persistence is greatest in the tails of the distributions and tends to be particularly
high in the upper tails: though in the U.S. this is reversed with a particularly high likelihood
that sons of the poorest fathers will remain in the lowest earnings quintile. This is a challenge
to the popular notion of ’American exceptionalism’. The U.S. also differs from the Nordic
countries in its very low likelihood that sons of the highest earners will show downward ’longdistance’
mobility into the lowest earnings quintile. In this, the U.K. is more similar to the U.S”

The last sentence should, of course, be underlined. The downward mobility of the high end is relatively benign, and is often more a matter of the composition of compensation than a matter of a true income drop that would persist over the lifecycle.

Studies of mobility in terms of wealth instead of income are harder. The urban institute report, here, has some important data and a survey of other studies. http://www.economicmobility.org/reports_and_research/literature_reviews. These do find mobility constant from the sixties to the mid 2000s – but in many ways, this is a trivial result, since what we are looking for is: is there more downward mobility from the middle class and lack of upward mobility among the poor as composed to upward mobility into the upper class and downward mobility among the richest.

The takeaway is that net worth has a tremendous effect, over generations, on the wealth of individuals.
“Several studies find a correlation between family wealth and relative intergenerational mobility. Mazumder (2005) divides families into two groups—those with net worth above and below the sample median. He finds the intergenerational earnings elasticity is about 33 percent smaller in the high net worth group. This finding is consistent with Bowles and Gintis (2002) who report that roughly one-third of the intergenerational earnings correlation can be explained by child wealth.”

23

Omega Centauri 01.06.12 at 10:20 pm

to follow up on Sam @16.
The mobility looked at there is change of quintile, which I guess is a measurement of relative mobility. Relative mobility, and inequlity (as measured by the Gini coefficient) are largely independent. But nevertheless to the extent that the top 80% feel they can participate in social mobility, the pressure to recognize increasing inequality is lessened. I find argumentation from quintile data rather frustrating, as the big change in recent inequality seems to be concentrated between the top 1% and the other 99%, or even between the top 1% and the 90-99%iles. And these are totally hidden in quintile data.

24

Tim Wilkinson 01.06.12 at 11:09 pm

Drum claims that the greater income-quintile-immobility of US over DK is down to the bottom quintile being much less mobile – it’s not; that’s just the most spectacular (and shameful) difference. Each graph (http://www.nytimes.com/interactive/2012/01/04/us/comparing-economic-mobility.html?ref=us) shows greater immobility in the US for its respective quintile (except one dead heat, for the top 20%), and in general the DK graphs are much flatter – i.e. show greater mobility. Whether this is moderately or extremely significant is hard to assess with the naked eye.

Also from Drum: Jared Bernstein points out that [poor mobility in US] is partly because income inequality in America is so high: you need a lot more money to move into the top 20% here than you do in Denmark. If we had less income inequality — if the poor families started out a little less poor and the rich families were a little less rich — [the US]’d be a more mobile society too. (My emph.)

This is the same petitio that Barry points out Tim Worstall perpetrates i.e. supposing that the income distribution is (in imagination) to be attenuated while income movements are to retain their actual magnitudes.

From the NYT piece:

Skeptics caution that the studies measure “relative mobility” — how likely children are to move from their parents’ place in the income distribution. That is different from asking whether they have more money. Most Americans have higher incomes than their parents because the country has grown richer. Some conservatives say this measure, called absolute mobility, is a better gauge of opportunity. A Pew study found that 81 percent of Americans have higher incomes than their parents…

But that’s really not a measure of mobility, just as it’s not one of equality. I don’t know if there’s a stat that attempts to summarise income mobility as Gini does (in)equality, but 0 social mobility – a perfect retention of the is surely compatible with income increases across the board. Perhaps the stat would be mean absolute number of n-iles traversed by all persons, with n-iles being defined relative to the respective (before, after) distributions, if that doesn’t make something fairly simple sound rather baffling.

The 81% – figure, supposedly measuring absolute (upward) mobility, also includes no measure of magnitude, only frequency, so the underlying reality could be a fairly trivial change. A similar figure for ‘relative’ mobility could be just as trivial – say the person dead on the 81st percentile is reduced to the status of pauper and becomes the poorest. Then relative upward mobility would be 81%, as everyone previously below that person is pushed up one position in the rankings.

In general, I suppose a plausible constraint on any measure of mobility per se (which would be ‘relatve’ mobility) would be that if it were used to generate separate figures for upward and downward mobility, the two should be of equal magnitude.

RE: ‘net worth’. A deeply unpleasant euphemism for net wealth.

25

Tim Wilkinson 01.06.12 at 11:54 pm

corr: “0 social mobility – a perfect retention of the ordering is surely compatible with income increases across the board.”

26

Gareth Wilson 01.07.12 at 12:48 am

There’s a paradox in social mobility statistics that I haven’t seen mentioned. Imagine a utopian society with true equality of opportunity, where everything from prenatal nutrition to graduate school is optimal for everyone. You succeed on your own inherent merits, not on your privileges of class or race or gender. So what’s social mobility like in that society? Terrible, since all the environmental influences have been removed, and intelligence and conscientiousness are totally determined by genetics. Your success is determined by who your father is, because the genes you inherit from him determine your inherent merits. So given enough generations, progressive policies aimed at bringing us closer to the utopia will make social mobility worse.

27

stubydoo 01.07.12 at 1:05 am

America is by far the most realistic place for someone today who has no money, no connections and no recognized qualifications to be genuinely wealthy five years later. I know of what I speak, since I did this myself. And my method for doing so was basically the Woody Allen approach – i.e. 90% of it is showing up (I attribute the other 10% to my good looks).

If the statistics show that only a small number of people are actually pulling this off, I doesn’t prove that there are unsurmountable barriers to doing so – it could just be that they are satisfied with their middle-class income levels, and are concerned with priorities other than getting rich.

28

Watson Ladd 01.07.12 at 1:17 am

stubydoo, that’s not what is being discussed. If we assume that education has some bearing on success beyond credential, then the fact that many americans face poor school systems condemns them to a life of poverty.

29

stubydoo 01.07.12 at 1:34 am

Yes but essentially everyone in America’s top four quintiles – and some of the lowest quintile – has access to a perfectly good education. Certainly as good as mine.

30

Eric H 01.07.12 at 3:16 am

I’ve been wondering for a while: given that European mobility is greater, and given that Europeans generally have greater belief in the idea that your success is mostly a product of luck, does this mean that they believe that this difference in mobility reflects luck or policy? If policy, is it because Euro policies reward random chance? Or are the two perceived as completely unrelated?

31

MPAVictoria 01.07.12 at 3:51 am

“America is by far the most realistic place for someone today who has no money, no connections and no recognized qualifications to be genuinely wealthy five years later.”

That is not what the research shows.

“I know of what I speak, since I did this myself”

Personal anecdotes are no replacement for statistical analysis.

32

Meredith 01.07.12 at 4:06 am

I’m not at all sure how important this question (or couple of questions) might be for the larger discussion here, but I think perhaps of some importance: do any of the various approaches to income inequality and social mobility take into account the increased percentage of women in the workforce in the last 30 years or so (and not just in the US, of course)? Or the effect on larger mobility data, as more women have entered the workforce, created by policies (e.g., maternity leaves, family hardship leaves, and daycare) that particularly affect women — their wealth as well as their income (and the wealth and income of their household)? I ask in part because in some of the discussion here, I see an elision of two distinct notions, “man’s wealth” (usually based, I infer, on the assumption of the man as the sole or chief earner in nearly all but sub-middle-class households — a reasonable enough assumption many decades ago) and “household wealth.”

33

The Tragically Flip 01.07.12 at 4:59 am

Yes but essentially everyone in America’s top four quintiles – and some of the lowest quintile – has access to a perfectly good education.

Could you spell out what you’re claiming here, and provide evidence for it? There’s overwhelming evidence that students who attend Ivy League schools have sigificantly better career paths and compensation than those that don’t attend such schools.

Seeing as access to higher paying jobs is a competitive thing, having access to a “perfectly good education” isn’t much help when your competitor has what is perceived as a better education.

The implied claim that there isn’t enough difference in educational opportunities across the top 4 quintiles is really remarkable. Who knew a degree from Random State U was as useful as one from Harvard?

34

Jeffrey Kramer 01.07.12 at 5:30 am

America is by far the most realistic place for someone today who has no money, no connections and no recognized qualifications to be genuinely wealthy five years later. I know of what I speak, since I did this myself.

I assume you tried being born with no money in France, Germany and Canada, and found it more difficult to get out of poverty in all those places. What were the most significant barriers you encountered there?

35

K. Williams 01.07.12 at 6:49 am

I’ll just repeat myself: almost all of the difference in mobility between the US and other developed nations is a result of the immobility of the bottom quintile. Contra Tim Wilkinson, the NYT graphs accompanying the argument show only trivial (that is, a couple of percentage point) differences between mobility in the US and mobility in Denmark for the top four quintiles. As the study Roger cites (supposedly to refute the contention that immobility is concentrated at the bottom) says, “Persistence is greatest in the tails of the distributions and tends to be particularly
high in the upper tails: though in the U.S. this is reversed with a particularly high likelihood that sons of the poorest fathers will remain in the lowest earnings quintile.” Almost all of the difference between the US and other developed countries is concentrated in those tails. This is not a story of the disappearing middle, or of the impossibility of middle-class kids improving their lives. It’s a story of the absolutely rotten situation in the US that poor people face, and the immense challenges they confront in trying to better their lives.

36

Shelby 01.07.12 at 7:26 am

cf the way the corporate media fell over themselves to give publicity to the Tea Party, and then ignored the Occupy Movement for as long as possible

As a generalist consumer of U.S. corporate media, I find this describes the opposite of what I’ve encountered. The Tea Party was universally dismissed and sneered at by corporate media; the Occupy Movement lauded and promoted.

More generally, my sense is that a onetime greater social mobility in the U.S. has eroded compared with many other places, and that this is due in large part to two evolutions: the increased importance of educated capability (i.e. intellectual accomplishment), and that of socio-educational capability (i.e. the perceived social worth of intellectual accomplishment). These could be distinguished as the ability to do a job, and the ability to get the opportunity to show that you have the ability to do the job.

Secondary (for now) but important is the network effect that grants early movers and top talents a “disproportionate” share of the rewards for doing certain things well, be it designing software or singing pop songs. For now that mostly benefits the top 0.1%; it will increasingly define the top (financial) 1% as the effect applies to more areas of the economy.

37

Down and Out of Sài Gòn 01.07.12 at 7:27 am

America is by far the most realistic place for someone today who has no money, no connections and no recognized qualifications to be genuinely wealthy five years later. I know of what I speak, since I did this myself. And my method for doing so was basically the Woody Allen approach – i.e. 90% of it is showing up (I attribute the other 10% to my good looks).

I’m trying to think of a profession where someone who has no money, no connections and no qualifications can get yourself lots of money and cash in five years. There may be some IT jobs in that area, but you have to be very specialised indeed to overcome the lack of a bachelor’s. Possibly stubydoo invented something patentable and lucrative, but he could do that in any country. But the other “get rich” professions I can think of are (a) particular professions that are excessively lucrative in the US but not so much anywhere else, and (b) something he’d find embarrassing to popularize, due to ick value or general unethical behavior.

My first guess was some role – acting, scriptwriting , production – in America’s multibillion porn industry, which must be bigger than that of any other country, and s/he did say s/he was good looking. I’m not knocking it: it’s a fair day’s work for a fair day’s pay. But the other jobs I can think of that fit all three criteria are both “only well paid in the US” and “ethically dubious as all fuck”.

Stubydoo could be working for one of America’s military contractor companies. Or could be someone who struck it rich in real estate during the Greenspan area in some complicated process involving property flipping, CDOs and tranches. Or worst of all, s/he could be (indrawn breath here) … a PR flack.

[Yes, it’s an eXiled link, which I know it’s not everyone’s cup of tea. I’ll cut to the money paragraph, while editing out the name.]

[H]e is the living embodiment of “Failing Up,” a cultural disease that is rotting this country at its core… a failure and a moron, with a valuable mixture of misanthropy and shameless ambition, traits that helped [him] fail his way up to the top of the DC Establishment. Because today, especially in a corrupt cesspool like Washington DC, failure and shamelessness are currency, whereas brains and integrity are handicaps. [He] has finally become the “super-villain” he dreamed of becoming—not much of an “evil genius” but definitely a villain. He’s a real-life Tracy Flick, only shorter, uglier, meaner and dumber: In other words, the real thing.

I’m not trying to malign stubydoo; I’m quite curious how he got rich. My point is that it may be easy to get rich legally in the States without a degree, but it probably involves leaving your ethics and your standards at the door. Most Americans would rather not do those jobs.

38

b9n10nt 01.07.12 at 8:13 am

Gareth @ 26.

Your paradox exists if 1) one’s merit is a measurement akin to one’s height, 2) this merit can be economically valued at all times and places by agents unhindered by any competing interest and 3) the genetic differences that influence merit are greater than the pre-utopian environmental influences.

To your argument’s credit, 3) is at least conceivable.

39

Gareth Wilson 01.07.12 at 10:06 am

b9n10nt @ 38.
I’m talking about adult IQ and the conscientiousness personality trait, both highly heritable and strongly correlated with economic success. Genetics might contribute more to them than the environment, but that’s not actually necessary for the paradox. All of the social mobility in our society comes out of changing environments. So in a utopia where we’ve already made everyone’s environment as good as we can, how can we have social mobility? It would all have to come from genetic reversion to the mean and random mutation, or mass genetic engineering.

40

Alison P 01.07.12 at 11:13 am

A world where talented people were enabled to do work that used those talents would be so very different from our own that it is hard to imagine it. But the natural churning of genes and the changing requirements of work would surely continue to put demands on the equal opportunity system which underpinned this utopia.

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Henri Vieuxtemps 01.07.12 at 12:20 pm

I don’t think social mobility is such a big deal. Inequality is.

Normally, you should be able pick a profession, trade, lifestyle that you enjoy, and that should be the end of it: no pyramid, no social gradations, no winners and losers. So, let the doctor have a fancier car and bigger house than the janitor, but not that bigger and fancier. After all, the doctors (and even the bankers) shouldn’t be doing what they are doing for the love of money.

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Tim Wilkinson 01.07.12 at 12:23 pm

K Williams @35 – almost all the difference is indeed ‘concentrated’ in the lowest quintile – but only because that stat is so huge; an odds ratio of 1.7 or so, i.e. in the US the son of a Q1 father is 70% more likely to end up in Q1 than his counterpart in DK is to remain in the Danish Q1.

The figures for QQ2-4 all show a percentage point difference for the relevant data points (in a notional matrix, those on the main diagonal where starting quintile=ending quintile) of about 3, which imply odds ratios of around 1.13 or more – not a ‘trivial’ finding, even though dwarfed by the misery of Q1.

(I know you can fiddle around with the presentation of stats like this almost endlessly – but mention of percentage points is generally a pretty good sign – even better than use of odds ratios – of significant spin being exerted. I originally said I couldn’t really tell if this was somewhat or very significant – but I think it’s reasonably safe to say ‘trivial’ is inaccurate.)

Not that income quintile mobility is necessarily of great interest in its own right for those not wedded to equal opportunities capitalism, as I think Gareth Wilson indirectly points out. (Though the ‘paradox’ overlooks the environmental aspects of ‘heritability’ correlations, for one thing. And if the question really is ‘how can we have social [wealth/income] mobility?’, then a general-purpose answer would be ‘by lot’. This kind of basic point does seem to get obscured by conservative/proprietarian presuppositions; cf. John “classless society” Major giving a ‘wealth flowing down the generations’ speech all about reducing inheritance tax.)

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The Tragically Flip 01.07.12 at 2:57 pm

Shelby:

As a generalist consumer of U.S. corporate media, I find this describes the opposite of what I’ve encountered. The Tea Party was universally dismissed and sneered at by corporate media; the Occupy Movement lauded and promoted.

When you say “universally” are you including Fox News, the NY Post, the WSJ, Clearchannel and the entirety of the very real and literal vast right wing noise machine?

I mean, there might be some debate about how what remains of the “mainstream media” treated the Tea Party but given that a substantial chunk of the major media are conservative in nature, it’s really impossible to credence this notion of “universal” sneering.

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Watson Ladd 01.07.12 at 3:27 pm

Henri, why should the janitor care how big the doctor’s car is?

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The Tragically Flip 01.07.12 at 4:00 pm

why should the janitor care how big the doctor’s car is?

There’s a real danger here in letting the costs of inequality be reduced to trivial items like this. Maybe the janitor shouldn’t care about the doctor’s car but he should care that his children are not denied all the best career options by virtue of the doctor’s kids buying up all the spots in the “elite” schools. He should care that politicians do not cater only to the Doctor’s concerns and leave his neighbourhood’s streets full of potholes and underserve him with transit. Speaking of doctors he should care that he and his family have access to that doctor when they need him, and if that doctor has rare and special skills, his time is allocated toward medical need not ability to pay.

There are scarce resources in any society, some things are even zero sum and when inequality denies the most important of these things to large swathes of the population, it matters.

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roger 01.07.12 at 4:40 pm

Alas, our problem is that doctors care very much how big the janitor’s car is, thus the intrusion of the state to enforce the rights of capital over those of organized labor, for instance, and the Fed’s policing of our society so that wage ‘inflation’ doesn’t get out of hand. Janitors and doctors are eternally in a power struggle. The doctors may be winning right now, and certainly the janitors, the butchers and the bakers have paid a pretty penny to keep the investor class solvent and rich, over the last four years, while the wage class has been blasted to hell.

The downward mobility of the 80 percent and the entrenched wealth of the plutocracy are, however, in a more precarious tension at the moment than the plutocrat’s assume. As the state once again backstops the plutocrats with trillions of dollars of ‘loans’ in the next cycle of the financial panic, this may actually rub the janitors the wrong way. They might realize that the doctor’s car is theirs, and take it. Fine driving, too!

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Meredith 01.07.12 at 4:59 pm

Could we use another example or illustration than the doctor? Given every doctor’s years of time- and energy-consuming education (costly, too — humongous loans), years of low-paid apprenticeship (residents’ income is usually somewhere around $35,000 a year), and the long, demanding hours they work once they are established, and given that, for the most part, only distinguished specialists rake in giant salaries, I dunno — there’s got to be a better illustrative foil to the janitor.

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Henri Vieuxtemps 01.07.12 at 5:00 pm

Because if two people work equal number of hours, both doing useful work, and one of them is driving a rolls-royce and the other one a yugo, then the second one is being shafted, obviously. Nobody likes being shafted.

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MPAVictoria 01.07.12 at 5:17 pm

“long, demanding hours they work once they are established, and given that, for the most part, only distinguished specialists rake in giant salaries, I dunno”

Most doctors I know make hundreds of thousands of dollars a year. That seems like a pretty great wage to me. Of course maybe you are an investment banker….

50

Billikin 01.07.12 at 5:24 pm

@ Gareth Wilson

There is no paradox, even though it will be true that one’s status will be correlated with one’s parents’ status. In that case social mobility will be random, but, as Galton observed in the 19th century, there will be a regression towards the mean. As we know now, that is a statistical artifact. But your children will on average be closer to the mean than you, and their children will on average be closer, etc. Furthermore, the further away you are from the mean, the more we expect that your children will move towards the average.

Suppose, now, that we split the population into two castes of equal size, with no intermarriage between castes. Then within each caste we will see regression towards the mean of the caste. The children of the people in the second and third quartiles will, on average, be moving in the opposite direction from the first situation with no castes. Furthermore, we would expect the generations in each caste to be moving half as fast, since they have half as far to go. There will be less social mobility in two senses. First, the caste structure prevents switching between upper and lower castes, and second, the movement within castes is slower.

Take that to the extreme, creating more and more castes, and you approach no social mobility at all.

Now, most modern societies are not caste systems. However, eliminate and reduce barriers and factors that keep people “in their place”, and social mobility increases, even if, for genetic reasons, the status of the child is close to the status of the parent. There is no paradox. :)

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ralph 01.07.12 at 5:57 pm

i wonder what results you would find, especially for the mobility of those in the bottom quintile, if you adjusted for ethnicity. i imagine that 42% would not differ all that much from the figures for denmark and the uk

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Gareth Wilson 01.07.12 at 7:42 pm

Billikin@50.
In that sense, modern societies are caste systems – people mostly marry and have children with people of similar class and educational backgrounds. Perhaps that’s just another outcome of inequality of opportunity, the limits on economic success also limiting people’s potential marriage partners. But even successful Hollywood actors mostly marry people with similar educational backgrounds. So maybe even with true equality of opportunity, doctors would be more likely to marry other doctors than janitors.

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Watson Ladd 01.07.12 at 8:12 pm

Henri, the problem is capital not labor. I’ve got no problem believing that someone can do 10 times more work then someone else in the same time: saving a life vs. cleaning a floor, and being payed appropriately. But I doubt that’s driving inequality in america: much more likely is the effect that capital owners have been doing pretty well, even in the middle of a recession.

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Meredith 01.07.12 at 11:29 pm

Gareth Wilson@50 makes an excellent point (one I think Veblen made over a century ago). So does Roger@1 (and others later), about the ways identity politics have distracted from class issues, sometimes by inadvertence and sometimes through intentional exploitation. I am certainly glad to see class issues coming to the fore again, and want to keep them there (which I doubt will be easy in the US ). But because I am persuaded that “a position supporting equality of opportunity while accepting highly unequal outcomes is not sustainable,” and because, obviously, more than identity politics or tokenism makes greater opportunity for women and blacks important, I still would like to see breakdowns in the mobility data for minorities and women woven into this larger analysis. Lots of data make it clear how bleak the picture has been for most Black Americans, despite the increase in upward mobility that civil rights legislation and other efforts have promoted. But women’s upward mobility, and the limits placed on it, at least as important for this discussion. (Tracking from father to son is an outmoded and perhaps misleading way of going about things, given the vastly increased role of women’s income in sustaining households.)
Btw, MPA Victoria’s image of me as in investment banker is extremely amusing. I must know mostly physicians in family or internal medicine. According to a Medscape study for 2011 (I hope I got all these figures right), the annual income for the former ranged between 100k and 250k, with the largest plurality earning between 150k and 174,999k; the male median was 165k, the female median 130k; the annual income for the largest plurality of latter ranged between 100k and 249,999k; the male median was 188k, the female median 160k. The national median for pediatricians (non-specialist) was 148k (males, 170k; females, 135k). General surgeons and oncologists, however (and I guess these must be the physicians MPA knows, or else she’s friends with the academic or research pediatricians and other pcp’s who can earn really really big bucks), fared a great deal better: median general surgery annual salary of 300,000k (81% male; male median 300k, female 261k — to be fair, surgeons take so long in training that board certified surgeons tend to be older than many other doctors, with lots of debt and fewer years to pay it off); oncologists’ median income was 285k (male, 320k; female, 225k).
The national median physician salary: male, 225; female, 160. Northeast median: 279k.
I’m not suggesting that physicians aren’t paid extremely well. (Nor do most physicians have serious complaints about their compensation, according to the Medcap survey.) I’m just saying, especially given their incredibly long and difficult hours and the life-or-death pressures they often work under, physicians are not poster boys (or girls) for the 1% or even the 10%.
Full disclosure: my son is in medical school and my brother is a janitor (yes, he really is). I am a well paid college professor (at least, now I’m well paid — for years I was not, especially the years before the salary inequities between males and females were corrected at my institution.)

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nick s 01.08.12 at 1:52 am

My point is that it may be easy to get rich legally in the States without a degree, but it probably involves leaving your ethics and your standards at the door. Most Americans would rather not do those jobs.

But America is definitely the best place in the world for con artists, shysters, bullshit merchants and affiliated tradespeople to get “genuinely wealthy”, which raises the question of why more Americans don’t take up that lucrative line of work.

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bjk 01.08.12 at 1:57 am

“done very well despite deprived backgrounds (Obama, for example). “

Where is the deprived background? An elite private school in Hawaii? Occidental? Columbia?

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Omega Centauri 01.08.12 at 4:27 am

Meridith, given those numbers I would conclude that the vast majority of doctors are in the ten percent, but very very few are in the one percent. I had a list of numbers and 90th percentile was 154K, and 99th was 507K. I never knew what the rules for income were, so I can’t quite place myself (i.e. does income include money put into 401K,a employer matches etc etc.).

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MPAVictoria 01.08.12 at 4:48 am

Hi Meredith,
I recently went from making 30 thousand a year to making just over 70 so those wages all pretty high to me.
/Just for information I have about 7 years of post secondary education.
// Do Doctors really work harder than a single mother holding down three jobs trying to make rent?

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Meredith 01.08.12 at 6:07 am

MPAVictoria, of course I’m not suggesting anything of the sort. Of course physicians’ wages are very, very high by any decent person’s measure. And they’re certainly a lot higher than mine. I am only suggesting that their wages are, on the whole, still probably not as high as many people imagine (especially when their debts and various other obligations — e.g., investments toward retirement — are figured in) and that, more important,whether physicians on the whole are overpaid or underpaid, they are not the leeches that, say, many in finance are.
Maybe the most important thing: we shouldn’t be arguing about stuff life this when we probably agree on much that is much more basic. Opportunity and mobility questions can’t be decoupled from gender or race. Or from policies about health insurance, maternity leaves, and childcare. Or policies about funding education, whether training for trades, BA’s, or advanced degrees of various kinds (including MD’s). I apologize if my visceral, idiosyncratic reaction to the doctor/janitor illustrative contrast got me distracted.

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praisegod barebones 01.08.12 at 12:09 pm

Gareth Wilson @ 26

Your success is determined by who your father is, because the genes you inherit from him determine your inherent merits.

This seems to rely on a rather Aristotelian understanding of how heredity works…

61

FromGreece 01.08.12 at 1:56 pm

@Shelby: “the increased importance of educated capability (i.e. intellectual accomplishment), and that of socio-educational capability (i.e. the perceived social worth of intellectual accomplishment). These could be distinguished as the ability to do a job, and the ability to get the opportunity to show that you have the ability to do the job.”

So, in Denmark, a country with fewer burger flipping jobs per capita and a lot more mobility and income equality, educated capability has lower importance?

62

LFC 01.08.12 at 4:26 pm

@37 Down and Out

Fwiw, there is a response to that eXiled piece you linked here. (I’m not taking sides on the substantive issue re Kazakhstan and it’s OT for this thread, but since you linked to that piece I thought some might possibly be interested in the response.)

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Giampiero Campa 01.10.12 at 2:57 am

The real problem it’s not just outcome, it is the fact that going to a university cost a LOT of money in the US, at least compared to Europe, where it’s mostly free. That I think is the reason #1 for social immobility in the US.

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chris 01.10.12 at 3:12 am

In that sense, modern societies are caste systems – people mostly marry and have children with people of similar class and educational backgrounds. Perhaps that’s just another outcome of inequality of opportunity, the limits on economic success also limiting people’s potential marriage partners.

Well, duh. Class-segregated housing, in particular — it’s hard to marry someone you never met. Or to have children with them, which isn’t quite the same thing anyway. But the reason class-segregated housing is so high-stakes is the location-segregated, very unevenly funded educational system. Which is kind of the reason for the whole thread — your parents’ wealth determines your opportunities. That’s the class system working as designed.

But even successful Hollywood actors mostly marry people with similar educational backgrounds. So maybe even with true equality of opportunity, doctors would be more likely to marry other doctors than janitors.

In present-day US society, your educational background is determined principally by your parents’ class (both directly, through school districts and private schools, and indirectly, through the well-known effects of childhood nutrition and health on intelligence measures, so that even “merit” tests — even the ones that manage to not just be achievement-up-till-now tests, which is really really hard to avoid — are really testing parental class to a large extent).

True equality of opportunity would be so radically different from that it’s hard to even imagine.

Anyway, the argument doesn’t really work because the environmental factors that could be eliminated by a utopia aren’t all the environmental factors that matter. Removing the *systematic class bias* in environmental factors would be a big deal, but it wouldn’t let you read genetics directly off the outcomes. There would still be a lot of basically random factors.

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Andrew H. 01.10.12 at 3:32 am

Boo hoo. I can tell you a multitude of people I personally know who made it happen in the real world, it involves having a will to do “whatever it takes” and the mental fortitude to make it happen. When my starving Irish ancestors came to America poor as dirt I don’t think we sat around like children and cried about how unfair the world is, I think we did something about it.

We were hated like any minority that has c0me to this country. We had no economic mobility but we MADE IT HAPPEN. Grow up, nobody owes you a damn thing. The world doesn’t owe any of us rat feces.

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John Quiggin 01.10.12 at 4:05 am

“we MADE IT HAPPEN”

Notably, by joining the Democratic Party in large numbers and providing the support base for programs like the New Deal.

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Joe 01.10.12 at 5:30 am

For this current generation of young people and for the generations that come after it the idea of social mobility will be a quaint relic of a bygone age, much in the same way we view the factory-job-for-life ethos of the 50s and 60s.

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