[yummyfajitas]

That is what wealth is... better schools, better food, better holidays...

No, that's consumption. Wealth is ownership of stocks, bonds, REITs, and other investment vehicles. It provides no value whatsoever to the holder until it is consumed.

If consumption is what you are worried about, you should focus on consumption inequality, which is vastly lower than either wealth or income inequality and has not risen anywhere nearly as sharply.

http://www.voxeu.org/article/economic-inequality-during-rece...

[anigbrowl]

You can't consume if you don't have any wealth to spend. Conversely, the wealthier one is the lower one's marginal propensity to consume. Very wealthy peoplewho literally have more money than they know what to do with end up investing the rest, but thanks to financialization (among other things) that investment doesn't generate as much demand for labor as it used to, making it harder for people without surplus capital to accumulate wealth.

I know you love to characterize poor people as living high on the hog but it's a bullshit characterization. The least educated are the most vulnerable to the constant imperative to consume with which people are confronted in western society.

[yummyfajitas]

Conversely, the wealthier one is the lower one's marginal propensity to consume.

I'm glad you agree that stegosaurus is wrong, and that increased wealth inequality isn't a strong driver of consumption inequality or educational inequality.

I know you love to characterize poor people as living high on the hog...

Since you are using the phrase "high on the hog", I think you actually meant to respond to my other post. But that post characterizes rich people (namely Americans) this way, not poor people (Chinese, Indians).

[anigbrowl]

I'm confused about the 'high on the hog thing' from your other post (I just didn't feel like replying to both), because stegosaurus was talking about inability to save during the baseline cost of living, which you went on to suggest was treated very differently in the US.

I think you're equating the US being a rich society compared to others with all the people in the US being rich in absolute terms, disregarding their relative poverty within the US. But you know very well that absolute measures of wealth are pretty meaningless given the fact of geographic dispersion. If you're talking to someone who doesn't know how to get ahead in the US and feels pinched by a lack of disposable income, observing that they're far better off than a peasant in some other country isn't responsive to their problem, notwithstanding the truth of the matter. It's not like this person struggling with poverty in the US can just relocate to the peasant area and start leveraging his capital advantage.

[stegosaurus]

I think that what yummyfajita is trying to get at is the idea that as societies the US, UK etc spend up to their limits rather than saving.

The problem is that this doesn't really generalise into individuals being able to opt out of the spending.

If everyone refused to pay 50% of their income on rent then rents would fall (unlike, say, food production, the homes won't just cease to exist).

But an individual can't affect that change. If they want to work in a city, they rent in that city.

There are a few oddball solutions that can work in unique cases. Living with parents works if they are willing and your hometown has a decent employment market. Living in a car might work in some places. House sharing might work if you can find reasonable housemates and you are well paid (if you have no hope of ever saving much, then it's pointless to inflict a crap life upon yourself for a future that will never come).

The idea that people spend loads on crap just doesn't add up to me though. When rent, energy, taxes and minimum food (e.g. 20pw rice and beans diet) add up to most of your income, does it really matter what you do with the small amount left over?

edit: Oh; and the capital advantage on moving doesn't exist. Most people have zero net worth.